Research and Development Tax Concession
Metal Storm Limited is pleased to announce it has received confirmation from AusIndustry that it is eligible for the Commonwealth Governments Research and Development Tax Concession program and has received its registration number for the 2010/11 financial year.
The R&D Tax Concession is the principal Commonwealth Government initiative to increase the amount of research and development (R&D) undertaken in Australia and provides a tax offset for companies that meet certain criteria.
Registration under the scheme is the first step in obtaining the tax offset. Metal Storm has qualified for this tax offset in previous years and is expecting a rebate this year of approximately $550k to $650k and should have confirmation of the amount along with the funds in around 6 weeks.
To monetize this rebate Metal Storm has signed a short term loan agreement with Andrew Doyle for $500k. The principal will be repaid upon receipt of the R&D tax rebate.
As consideration for providing the loan, Metal Storm will issue the lender with 1.4 million options that have a life of 2 years and an exercise price of $0.001. A further 50,000 options will be issued for each day the loan is not repaid if the principal has not been repaid within 4 weeks. At current stock prices
this is equivalent to 11% per annum.
Metal Storm will be using the funds to progress development and testing of the TASER XREP ammunition for its MAUL TM weapon, as well as for other operating requirements.
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