The first M16 LMG was essentially a modified M16A1 with a new square hand guard to cover the enlarged gas tube, a carry handle on top of this hand guard, with a hydraulic buffer and a the ability to fire from an open bolt. An angled fore grip was added to the hand guard to improve handling as an automatic rifle. The first LMG layout can be seen in the patent awarded to Colt engineer Henry Tatro. Rear sights later featured on the M16A2 were also introduced, and the weapon could only fire on the fully automatic setting. Colt initially packaged these weapons with the MWG 90-round "snail drum" (This was before the introduction of the Beta Systems C-Mag). Colt had also originally used the M60 bipod, but switched this to a proprietary design that was lighter for the subsequent Model 750
The Colt Model 750 was an improvement of the basic principle of the Colt LMG, developed jointly by Colt and Diemaco with an eye toward the Canadian Army (though they would eventually select the FN Minimi). The improved version featured all A2 parts and is essentially the same as original variant externally except for the redesigned vertical fore grip, now of a straight cylindrical style that is ribbed. This weapon was marketed by Diemaco as the Diemaco C7 Light Support Weapon (LSW) or simply as the LSW.
Colt and Diemaco further improved on the design, adding a flat top carry handle and a further improved bipod to the weapon sometime during the '90s. The new model number is 950 but is currently marketed as the Colt Automatic Rifle, and until their purchase by Colt, as the Diemaco LSW.
M16A3 LSW or Light Machine Gun is a gas operated, air cooled magazine fed, fully automatic weapon which fires from an open bolt. The gun is equipped with a heavy barrel, vertical hand grip, spigot mounted Parker-Hale bi pod and square cross section hand guards. The M16A3 LSW/LMG shares common features and many parts with the M16A3 rifle. The trigger, hammer, selector, bolt carrier, recoil spring, buffer, bolt catch, and auto sear are all different than the standard M16 components. The M16 LMG is not select fire, it fires fully automatic only. Since a forward assist will not work and would be dangerous on an open bolt machine gun, there is not one on the LMG/LSW and the bolt carrier is without forward assist notches.
The Danish model of the LSW is select fire and fires from a closed bolt. The fire control group is identical to that of the standard M16 rifle. The Danish model also has the forward assist.
The method of operation of the open bolt fire control group is completely different than that of the M16 series of rifles and carbines. The below diagrams from the manual best illustrates how the hammer acts as the sear. The trigger actually pulls the hammer down and out of engagement with the bolt carrier notch. This allows the bolt carrier to go forward and strip and chamber a round. When the bolt carrier fully closes, the hammer is release by the auto sear to fire the cartridge. The cycle continues until the trigger is released or the magazine runs out of ammunition. When the magazine does run out of ammunition, the bolt catch is activated and the bolt carrier is locked back on the catch. When the operator pushes the magazine release button, the extension on the bolt catch is engaged by the button and the bolt carrier drops down onto the hammer/sear and is ready for firing. There is no need for manipulation of the bolt catch to bring the weapon back into action once it is reloaded.
Contrary to the many internet myths about the wear and tear on the lower receiver caused by using the hammer as the sear, I have not experienced any significant wear in two different guns with over 30,000 rounds through them. Most internet posters on the subject have never owned or shot the open bolt version of the Colt M16 LMG.