A.B.N. 55 082 541 437

NOTICE OF GENERAL MEETING & EXPLANATORY MEMORANDUM

TO SHAREHOLDERS

Time and: Date of Meeting

Place of Meeting:

11:30 am (Perth time) on Thursday, 30 June 2005

Suite 3 The Forrest Centre Conference Suites Level 14, The Forrest Centre 221 St Georges Terrace Perth, Western Australia

IMPORTANT NOTICE

It is recommended that Shareholders read this Notice of Meeting and Explanatory Memorandum booklet in full and if there is any matter that you do not understand, you should contact your financial adviser, stockbroker or solicitor for advice.

All of the Directors recommend that Shareholders approve Resolution 1.

All of the Directors (save for Mr Victor Ho who makes no recommendation as he is a director of Central Exchange Limited) recommend that Shareholders approve Resolution 2.

The attached Independent Expert's Report prepared by BDO Consultants (WA) Pty Ltd has concluded that the transaction in Resolution 2 is FAIR AND REASONABLE to the non-associated existing shareholders of the Company.

Notice of General Meeting	2
Explanatory Memorandum
1. Summary	4
2. Background	7
3. Financial Effects and Capital Structure	11
4. Taxation	17
5. Suspension from ASX	17
6. About CXL and BEL	18
7. Resolution 1 - Return of Capital	20
8. Resolution 2 - Sale of Shares	22

www.alteracapital.com

Visit our website for:

Latest News

Glossary
Market Announcements
Financial Reports $\overline{a}$

EMAIL US AT: [email protected]

CORPORATE DIRECTORY

BOARD Faroog Khan	Chairman and Managing Director
Victor Ho Simon Cato	Director Director
COMPANY SECRETARY Victor Ho
REGISTERED OFFICE AND PRINCIPAL PLACE OF BUSINESS Level 14, The Forrest Centre 221 St Georges Terrace
Perth Western Australia	6000
Telephone: Facsimile:	(08) 9214 9787 (08) 9322 1515
Email:	[email protected]
Web:	www.alteracapital.com
SHARE REGISTRY
Advanced Share Registry Services 110 Stirling Highway
Western Australia Nedlands	6009
Telephone:	(08) 9389 8033
Facsimile: Email:	(08) 9389 7871 [email protected]
Web:	www.asrshareholders.com.au

INDEPENDENT EXPERT
BDO Consultants (WA) Pty Ltd Level 8, 256 St Georges Terrae
Perth Western Australia 6000
Telephone:	(08) 9360 4200
Web:	www.bdo.com.au

PURPOSE OF THIS DOCUMENT

This Notice of Meeting and Explanatory Memorandum has been prepared for the purpose of providing Shareholders with all the information known to the Company that is material to the Shareholders' decision on how to vote on the proposed resolutions at the General Meeting. Shareholders should read this Notice of Meeting and Explanatory Memorandum in full to make an informed decision regarding the resolutions considered at this General Meeting.

This Notice of Meeting and Explanatory Memorandum is dated 31 May 2005.

ENQUIRIES

If you have any questions regarding the matters set out in this Notice of Meeting and Explanatory Memorandum, please contact the Company Secretary or your professional advisers.

NOTICE OF GENERAL MEETING

Notice is given that a General Meeting of shareholders of Altera Capital Limited A.C.N. 082 541 437 (Company or Altera Capital or AEA) will be held at Suite 3, The Forrest Centre Conference Suites, Level 14, The Forrest Centre, 221 St Georges Terrace, Perth, Western Australia at 11:30 am (Perth time) on Thursday, 30 June 2005.

AGENDA

ORDINARY BUSINESS

1. Resolution 1 Approval of Return of Capital

To consider, and if thought fit, to pass the following resolution as an ordinary resolution:

"Subject to and conditional upon shareholder approval of Resolution 2 and the completion of a share capital return proposed by Sofcom Limited ("SOF") which is the subject of SOF shareholder approval at a general meeting to be held on 30 June 2005 (the "SOF Return of Capital"), that under section 256B and 256C(1) of the Corporations Act, the Company's constitution, and for all other purposes, approval is given to the Company to reduce the fully paid ordinary share capital of the Company (the "Share Capital") by returning to the ordinary shareholders of the Company, in proportion to the number of ordinary shares held by them at midnight (Perth time) on 8 July 2005 ("Record Date"), the following assets (Share Capital) of the Company:

An in-specie distribution of all of the shares in Central Exchange Limited ("CXL") that may be (i) received by the Company under the SOF Return of Capital;
$(ii)$ An in-specie distribution of all of the shares in Bentley International Limited ("BEL") (if any) that may be received by the Company under the SOF Return of Capital; and
$(iii)$ An in-specie distribution of all of the shares in SOF held by the Company,

as outlined in this Notice of Meeting and Explanatory Memorandum."

$2.$ Resolution 2 Approval of Sale of Shares

To consider, and if thought fit, to pass the following resolution as an ordinary resolution:

"That, subject to and conditional upon shareholder approval of Resolution 1, for all purposes, approval is given for the Company to undertake the following transaction with CXL:

The sale to CXL of 698,718 shares in Scarborough Equities Limited ("SCB"), held by the (i) Company for a consideration per share equal to the last reported NTA (post tax) backing value of SCB per share, the total consideration to be paid by cash to the Company, upon the exercise of CXL's option pursuant to the SCB Option Deed,

as outlined in this Notice of Meeting and Explanatory Memorandum."

DATED THIS 31^st DAY OF MAY 2005

BY ORDER OF THE BOARD

VICTOR HO COMPANY SECRETARY

TIME AND PLACE OF GENERAL MEETING AND HOW TO VOTE

Venue

The General Meeting of the shareholders of Sofcom Limited will be held at:

Suite 3 The Forrest Centre Conference Suites Level 14, The Forrest Centre 221 St Georges Terrace Perth, Western Australia

commencing

11:30 am (Perth time) Thursday, 30 June 2005

How to Vote

You may vote by attending the meeting in person, by proxy or authorised representative.

Voting in Person

To vote in person, attend the meeting on the date and at the place set out above.

Voting by Proxy

To vote by proxy, please complete and sign the proxy form enclosed with this Notice of General Meeting as soon as possible and either:

send the proxy by facsimile to the Company on facsimile number (08) 9322 1515; or
deliver to the principal place of business of the Company at Level 14, The Forrest Centre, 221 St Georges Terrace, Perth, Western Australia 6000.

so that it is received not later than 11.30 am (Perth time) on Tuesday, 28 June 2005.

Your proxy form is enclosed.

Bodies corporate

A body corporate may appoint an individual as its authorised corporate representative to exercise any of the powers the body may exercise at meetings of a company's shareholders. A properly executed original (or certified copy) of an appropriate "Appointment of Corporate Representative" should be produced for admission to the meeting. Previously lodged Appointments of Corporate Representative will be disregarded by the Company.

Powers of Attorney

A person appearing as Power of Attorney for a shareholder should produce a properly executed original (or certified copy) of an appropriate Power of Attorney for admission to the meeting. Previously lodged Powers of Attorney will be disregarded by the Company.

Voting Entitlement

In accordance with section 1074E(2)(g)(i) of the Corporations Act and regulation 7.11.37 of the Corporations Regulations, the Company has determined that for the purposes of the General Meeting all Shares in the Company will be taken to be held by the persons who held them as registered Shareholders at midnight (Perth time) on 28 June 2005 (Voting Entitlement Time). Subject to the voting exclusions noted below, all holders of Shares in the Company as at the Voting Entitlement Time will be entitled to vote at the General Meeting.

VOTING EXCLUSIONS

The Company will disregard any votes cast on Resolution 2 by:

$(1)$ Central Exchange Limited;
$(2)$ any party who might obtain a benefit if Resolution 2 is passed (except a benefit solely in the capacity of a Shareholder); and
any party who is an Associate of a party referred to in (1) and (2) above. $(3)$

However, the Company need not disregard a vote if:

$(a)$ it is cast by a party as proxy for a party who is entitled to vote, in accordance with the directions on the Proxy Form: or
$(b)$ it is cast by the person chairing the General Meeting as proxy for a party who is entitled to vote, in accordance with a direction on the Proxy Form to vote as the proxy decides.

The Company will not disregard the votes of any shareholder cast on Resolution 1 as all shareholders of the Company will participate equally under the Return of Capital contemplated in such resolution.

OTHER NOTES

Role of ASIC and ASX

A copy of this Notice of Meeting and Explanatory Memorandum has been lodged with ASIC and ASX. Neither ASIC nor ASX nor any of their respective officers takes any responsibility for the contents of the Notice of Meeting and Explanatory Memorandum.

ASX Listing Rule 10.1

Listing Rule 10.1 requires that a company must ensure it does not acquire or dispose a substantial asset without approval of the shareholders of the company.

The transactions contemplated in Resolution 2 would trigger the requirement for shareholder approval under Listing Rule 10.1.

Listing Rule 10.10 provides that a notice of meeting for the purposes of Listing Rule 10.1 must include a report on the proposed transaction from an independent expert.

Accompanying this Notice of Meeting and Explanatory Memorandum is an Independent Expert's Report prepared by BDO Consultants.

BDO Consultants has formed the opinion that the transaction contemplated in Resolution 2 is FAIR AND REASONABLE to the non-associated shareholders of the Company.

EXPLANATORY MEMORANDUM

SUMMARY $\mathbf 1$ .

1.1 Overview of Resolutions

Resolution 1 seeks shareholder approval for the Company to undertake an equal reduction of its share capital under Chapter 2J of the Corporations Act by the Return of Capital to shareholders, being:

An in-specie distribution of all of the shares in Central Exchange Limited (CXL) that may be $(1)$ received by the Company under the SOF Return of Capital;
$(2)$ An in-specie distribution of all of the shares in Bentley International Limited (BEL) (if any) that may be received by the Company under the SOF Return of Capital; and
$(3)$ An in-specie distribution of all of the shares in SOF held by the Company.

Resolution 2 seeks shareholder approval for the sale of 698,718 SCB shares held by the Company to CXL for a consideration per share equal to the last reported NTA (post tax) backing value of SCB per share, the total consideration to be paid by cash, upon the exercise of CXL's option pursuant to the SCB Option Deed:

Resolution 1 and Resolution 2 are interdependent as a condition precedent of the SCB Option Deed is that shareholder approval of the Return of Capital be received. If Resolution 1 is not approved, Shareholders will not be asked to consider Resolution 2. Further, notwithstanding approval of Resolution 1 the Return of Capital contemplated by that resolution will not proceed if Resolution 2 is not approved.

The Company will not proceed with the in-specie distribution of its shareholding in SOF unless SOF completes the SOF Return of Capital.

As a result of the transaction contemplated in Resolution 2, the Company will (if that resolution is approved) convert all of its share investments (save for its investment in SOF shares) into cash.

As a result of the Return of Capital contemplated in Resolution 1, the Company will (if that resolution is approved) distribute all of its share investments (including the shares obtained under the SOF Return of Capital) to Shareholders of the Company.

The existing capital structure of, and shareholdings in, the Company will remain unchanged by the Return of Capital and the Company will continue to be suspended from ASX.

After payment of all liabilities, the Company expects to retain approximately \$50,000 in cash to maintain the listing of the Company on ASX pending the proposed recapitalisation of the Company and the undertaking of a transaction to allow for the Company to be re-admitted to ASX. Your shares in the Company will therefore only have a nominal (minimal) value. There is no guarantee as to if, or when, this may occur. Shareholders investment in the Company will therefore remain illiquid as you will not be able to engage in on-market trading in your Shares in the Company.

1.2 Reasons for Return of Capital and Proposed Transactions

As reported in the annual and half yearly reports of the Company for the last 2 years, the Board has been considering an "Aggregation Strategy" whereby the assets of the Company (being relatively small in value) are "aggregated" into a larger listed company resulting in a combined capital base of at least \$15 million. Such strategy is outlined in Section 2.1 of this Notice of Meeting and Explanatory Memorandum.

The Board has now been able to finalise its "Aggregation Strategy" as a result of the recent finalisation of the outstanding matters relating to its investment in SCB and litigation that was commenced in relation to that investment.

The transactions proposed in Resolutions 1 and 2 are consistent with the Company's previously enunciated "Aggregation Strategy".

As part of the Return of Capital, the Company will make an in specie distribution of all of the shares in CXL and BEL (if any) that may be received by the Company (in its capacity as a shareholder of SOF) under the SOF Return of Capital. For further details, including as to the conditions which must be satisfied for the SOF Return of Capital to proceed, see section 3.1.

CXL is an investment company listed on ASX (ASX Code: CXL) with net assets of \$17.23 million (pre tax) and \$16.73 million (post tax) based on its last reported NTA backing for 30 April 2005.

BEL is an investment company listed on ASX (ASX Code: BEL) with net assets of \$16.65 million (pre and post tax) based on its last reported NTA backing for 30 April 2005.

The gross asset position of CXL will increase as a consequence of its purchase of the assets of Altera Capital proposed by Resolution 1 and similar transactions proposed between Sofcom and CXL. Upon the completion of the SOF Return of Capital and the Company's Return of Capital, Shareholders will become shareholders in a significantly larger listed company whilst retaining their current shareholding in Altera Capital as a listed but suspended "shell" company with minimal assets awaiting a possible recapitalisation.

Settlement of the transaction contemplated in Resolution 2 will also provide AEA with the cash funds required to meet its normal expenses and liabilities and to discharge a portion of its share of the obligations to SCB and ADG under the costs settlement referred in Section 2.3 of this Notice of Meeting and Explanatory Memorandum without the Company having to dispose of its share investments (principally shares in SOF) in circumstances where such share investments are trading at significantly below their NTA backings and the Company's average entry cost and, in the case of SOF, in a relatively illiquid stock.

1.3 Independent Expert's Report

The Independent Expert's Report prepared by BDO Consultants accompanies this Notice of Meeting and Explanatory Memorandum.

BDO Consultants has formed the opinion that the transaction contemplated in Resolution 2 is FAIR AND REASONABLE to the non-associated shareholders of the Company.

	Resolution 1 - Return of Capital	Resolution 2 - Sale of Shares
Advantages	Assuming the SOF Return of Capital proceeds and the Company receives CXL shares thereunder, Shareholders will obtain a shareholding in CXL, which is an LIC with a significantly greater asset base
	There may be more liquidity in trading in CXL shares than shares in the Company as ٠ CXL has a larger market capitalisation and greater shareholder base
	CXL is an LIC with exposure to a more diversified portfolio than that which can be ٠ achieved with the net assets of the Company

	Resolution 1 - Return of Capital	Resolution 2 - Sale of Shares
Advantages continued	Shareholders will retain their existing ٠ Shareholding in the Company after the Return of Capital and will remain as shareholders (however see "Disadvantages" below) after the potential recapitalisation of the Company and the potential entering into of a transaction that may result in the possible re-admission of the Company to ASX	٠ The Company is disposing of its SCB shares at SCB's NTA backing, which is significantly higher than its current share price The cash proceeds received from the sale of SCB shares will be utilised to meet the Company's share of liabilities to SCB and ADG pursuant to settlement of litigation cost orders (refer Section 2.3) - this obviates the need for the Company to dispose of its SCB share investments on-market which would have incurred a significant loss to the Company as SCB shares are trading at a significant discount to the NTA backing of such investment
Disadvantages	Shareholders' interest in the Company is ٠ likely to be significantly diluted upon the recapitalisation of the Company and the entering into of a potential transaction that may result in the possible re- admission of the Company to ASX The asset base of the Company will be reduced significantly after the Return of Capital;
If Resolution Not Passed	The Company will not be able to ٠ proceed with the sale of SCB shares the subject of Resolution 2 as a condition precedent of the SCB Option Deed is that shareholder approval of the Return of Capital be received	The Company will not be able to ٠ proceed with the Return of Capital the subject of Resolution 1 The Company will be required to ٠ dispose of all of its SCB shares and a significant portion of its SOF shares on- market to raise cash funds to meet general expenses and the Company's share of liabilities to SCB and ADG pursuant to settlement of litigation cost orders (refer Section 2.3) and thus incur a significant loss to the Company as SCB and SOF shares are trading at a significant discount to the entry cost and NTA backing of such investments
Board's Recommendation	All of the Directors recommend that Shareholders approve Resolution 1	All of the Directors (save for Mr Victor Ho who makes no recommendation as he is a director of CXL) recommend that Shareholders approve Resolution 2

$1.5$ Indicative Timetable

Event	Date
SOF General Meeting to approve, inter alia, the SOF Return of Capital	10:45 am (Perth time), 30 June 2005
AEA General Meeting	11:30 am (Perth time), 30 June 2005
Record Date for determining entitlements to participate in the Return of Capital	Midnight on 8 July 2005
Transfer of CXL (and potentially BEL) shares to SOF shareholders (which includes AEA) under the SOF Return of Capital	15 July 2005 *
Distribution of cash to SOF shareholders (which includes AEA) under the SOF Return of Capital	19 July 2005 *
Transfer of CXL, SOF (and potentially BEL) shares to AEA Shareholders the subject of the Return of Capital	22 July 2005 *
Despatch of Return of Capital Distribution Statements to AEA Shareholders	26 July 2005 *
Despatch of holding statements to AEA Shareholders in respect of their CXL, SOF (and potentially BEL) shareholding received under the Return of Capital	28 July 2005 *

Indicative dates only, which is subject to change.

2. BACKGROUND

$2.1$ "Aggregation Strategy"

The following is an extract from the Company's 2004 Annual Report on the "Aggregation Strategy."

"The Board believes that a listed company requires a critical mass of capital sufficient to secure commercial opportunities and accordingly provide both an income stream and capital growth for its shareholders. The Board believes that a prudent capital base from which a listed company is able to secure such commercial objectives is at least \$15 million.

This capital base of \$15 million dollars has been determined as an appropriate base by the Board based upon a number of matters including but not limited to an analysis of the existing capital structure of the Company, its current cash reserves, the present state of the Australian capital markets, the likelihood of the Company attracting capital investment in the short to medium term at prices at least equal to or in excess of its current cash backing and the level of internal investment capital the Board believes the Company requires to generate economic returns sufficient to attract investor support and accordingly the ability to raise further capital.

The Board does not believe that the Company will be readily able to achieve such objective on its own. The Board however believes that such objective can be achieved through an "aggregation" process whereby the assets of the Company and a number of other suitable listed companies are combined effectively into a single entity that holds the collective net tangible assets previously held in each separate company.

This "aggregation" process may be realised (subject to acceptable taxation advice and compliance with the Corporations Act and the ASX Listing Rules) through a number of avenues including participating companies subscribing in an existing "lead" company or to a new "master" company or .
via a scheme of arrangement or merger between participating companies. Alternatively, an existing participating company may be used as the "lead" vehicle in terms of the aggregation process.

In this regard, the Board is considering the Company as a participating company in relation to the aggregation of its funds into another "lead" or "master" company. The aggregation process in such scenario may involve:

The Company (along with other participating companies) effecting a "transfer" of available net tangible assets ("NTA") to the "master" company in exchange for shares in the "master" company (priced at the "master" company's NTA backing per share);
The participating companies would effect a capital return to its shareholders via an in-specie distribution of the "master" company's shares;
Such participating companies' shareholders would then become shareholders of the "master" company but will retain their existing shareholdings in their respective companies (at reduced NTA backing per share);
The "master" company's NTA would be expanded by the contributions of the NTA of the participating companies - this is with the aim of achieving a minimum capital base of \$15m (referred to earlier);
Such contributions or transfer of NTA's by participating companies may comprise cash or liquid investments (valued in turn at NTA backing or market as is appropriate);
In relation to contributions by way of liquid investments, the "transfer" of NTA or market value may involve a share acquisition agreement between the "master" company and a relevant participating company;
Alternatively, and also in relation to contributions of cash, the "transfer" of NTA value from participating companies to the "master" company may be pursuant to a specific share placement or wider capital raising undertaken by the "master" company;
Post aggregation, the balance sheet of the "master" company would comprise its existing pre-aggregation assets and the NTA contributed by the participating companies, being a combination of cash and liquid investments;
In all of the above "transfer" scenarios, the "master" company would value the shares it would issue at the NTA backing of the company and likewise, each of the participating companies would value their contribution of liquid investments at NTA backing or market value as is appropriate - so as to ensure that there is no or minimal "value shift" as between the companies;
The Company's shareholders would thus have a shareholding in the "master" company in proportion to the Company's contribution (valued at NTA or appropriate market value of liquid assets) into the "master" company and retain their existing shareholding in the Company (which will have a reduced NTA backing post "aggregation").

2.2 Shareholding in Sofcom Limited (SOF)

The Company currently has 36,258,535 shares in Sofcom Limited (SOF) (ASX code: "SOF") or 81.23% of SOF's current issued capital.

SOF's major assets are 4,700,000 shares (12.1%) in ASX listed investment company (LIC) Bentley International Limited (BEL) and 3,167,152 shares (4.21%) in Scarborough Equities Limited (SCB), also an LIC.

As described in Section 3.1 of this Notice of Meeting and Explanatory Memorandum, SOF has convened a general meeting, also to be held on 30 June 2005, to seek shareholder approval for the sale of 4.4 million of its BEL and all of its 3,167,152 SCB shareholding to CXL for a consideration per share equal to the last reported NTA (post tax) backing value of each of BEL and SCB per share respectively, with the total aggregate consideration to be paid by a combination of cash (\$775,000) and new shares in CXL (to be issued at CXL's NTA (post tax) backing per share), and to undertake the SOF Return of Capital.

AEA Directors, Messrs Faroog Khan, Victor Ho and Simon Cato are also directors of SOF.

SOF's last closing market price as at 19 May 2005 was 3.10 cents per share.

SOF's recent VWAP and high and low trading prices on ASX are as follows:

Month Ending	ASX	ASX	ASX
	High	Low	VWAP
$31 - Jul - 04$	\$0.051	\$0.051	\$0.051
31-Aug-04	۰
30-Sep-04	\$0.037	\$0.036	\$0.037
31-Oct-04	\$0.056	\$0.044	\$0.053
30-Nov-04	\$0.064	\$0.046	\$0.052
31-Dec-04	\$0.046	\$0.044	\$0.045
31-Jan-05	\$0.040	\$0.035	\$0.039
$28$ -Feb-05	\$0.040	\$0.036	\$0.039
31-Mar-05	\$0.036	\$0.035	\$0.036
30-Apr-05	\$0.035	\$0.031	\$0.032
1-19-May-05	\$0.031	\$0.031	\$0.031

2.3 Shareholding in Scarborough Equities Limited (SCB)

The Company currently holds 698,718 shares in Scarborough Equities Limited (formerly Rivkin Financial Services Limited) (ASX Code "SCB" - formerly "RFS") or 0.93% of SCB's current issued capital.

On 14 July 2004, SCB under the direction of former SCB Managing Director, Alan Andrew Davis commenced proceedings in the Federal Court of Australia in Sydney against SOF, Fast Scout Limited (FSL) and AEA for conduct allegedly contrary to the insider trading provisions of the Corporations Act (in relation to the three companies' collective acquisition of an initial aggregate 5% interest in SCB shares).

As part of the defence of the action, SOF, FSL and AEA commenced cross-claims against SCB and Network Limited (Network), Cole Kablow Superannuation Pty Ltd (Cole Kablow), Alan Davis Group Pty Ltd (ADG) and former SCB Managing Director, Alan Andrew Davis.

Justice Emmett handed down his judgment on 26 November 2004. Justice Emmett dismissed the claim made by SCB against SOF, FSL and AEA and SOF, FSL and AEA's cross-claims against SCB and the other cross-defendants.

On 29 November 2005, the board of SCB was replaced with nominees of SOF, FSL and AEA - Messrs Farooq Khan, Simon Cato and Christopher Ryan.

On 10 December 2004, Justice Emmett made the following orders as to costs:

In relation to the claim brought by SCB against SOF, FSL and AEA, the Court awarded costs to the (a) defendants on a "party-party" basis;

$(b)$ In relation to the cross claims brought by SOF, FSL and AEA, SOF, FSL and AEA were ordered to pay all of SCB's and the other cross defendants' costs on an "indemnity basis" provided such costs have been reasonably incurred.

On 17 December 2004, SOF, FSL and AEA lodged an appeal against that part of the decision of Justice Emmett dismissing their cross-claim against each of SCB and the other cross defendants.

On 4 February 2005, SOF, FSL and AEA entered into a deed of settlement with each of Network and Cole Kablow to discontinue the appeals against, and to settle the costs payable to, each such party in consideration of the payment by SOF, FSL and AEA of \$350,000 to Network and \$125,000 to Cole Kablow.

In April 2005, SCB and SOF, FSL and AEA reached agreement to resolve the outstanding matters between them by SOF, AEA and FSL discontinuing the appeal with no order as to the costs and by SOF, AEA and FSL paying an amount of \$382,500 to SCB (net of SCB's payment obligations to these parties). SOF, AEA and FSL have until 30 June 2005 to pay the costs settlement with interest accruing at 10% p.a. If the settlement sum is not paid by 30 June 2005, SOF, AEA and FSL have agreed to pay an additional amount of \$100,000 to SCB and interest shall accrue at 15% p.a.

On 18 May 2005, SOF, FSL and AEA agreed to pay \$310,000 to ADG to settle the costs in the discontinued appeal and under the cost orders of Justice Emmett described above. SOF, AEA and FSL have until 31 August 2005 to pay the costs settlement with interest accruing at 10% p.a.

Such settlement concludes all outstanding matters between the parties to the litigation.

SOF, AEA and FSL have agreed that the above legal and settlement costs payable by SOF, AEA and FSL are to be shared between each company in proportion to each company's relative interest in their collective stake in SCB (currently 4,711,971 shares) - SOF's share is 67%; FSL's share is 18% and AEA's share is 15%.

As a listed investment company, SCB discloses its NTA backing each month. SCB's last reported Gross NTA was \$16.2 million (pre tax) and \$15.6 million (post tax) with its last reported NTA Backing (post tax) as at 30 April 2005 of \$0.207 per share.

SCB's closing market price on 19 May 2005 was 12.5 cents per share.

SCB's recent reported NTA backings (post tax), VWAP and high and low trading prices on ASX are as follows:

Month Ending	ASX	ASX	ASX	NTA Backing
	High	Low	VWAP	Post Tax
$31 - Jul - 04$	\$0.230	\$0.205	\$0.217	\$0.191
31-Aug-04	\$0.210	\$0.160	\$0.196	\$0.177
30-Sep-04	\$0.225	\$0.180	\$0.206	\$0.179
31-Oct-04	\$0,250	\$0.195	\$0.230	\$0.172
30-Nov-04	\$0,300	\$0.215	\$0.247	\$0.175
31-Dec-04	\$0.245	\$0.210	\$0.239	\$0.169
$31 - Jan-05$	\$0,230	\$0.190	\$0.220	\$0.166
28-Feb-05	\$0.210	\$0.180	\$0.189	\$0.170
31-Mar-05	\$0.190	\$0.140	\$0.163	\$0.170
30-Apr-05	\$0.160	\$0.140	\$0.146	\$0.207
19-May-05	\$0.140	\$0.115	\$0.125	N/A

2.4 Annual and Half Year Reports

Shareholders should also refer to the Company's:

31 December 2004 Half Year Reports lodged on 28 February 2005. A copy of such Half Year $(1)$ Reports accompanies this Notice of Meeting and Explanatory Memorandum; and
$(2)$ 2004 Annual Report. A copy of this report can be emailed or posted to Shareholders upon request. It can also be viewed and downloaded from the Company's website: www.alteracapital.com

3. FINANCIAL EFFECTS AND CAPITAL STRUCTURE

$3.1$ The Sofcom Return of Capital (SOF ROC)

SOF has convened a general meeting to be held on 30 June 2005 to seek the following shareholder approvals:

$(1)$ Approval for the Company to undertake an equal reduction of its share capital under Chapter 2J of the Corporations Act by the Return of Capital to shareholders, being:
$\ddot{H}$ A distribution of \$450,000 cash;
$(ii)$ An in-specie distribution of all of the shares in CXL to be received by SOF on settlement of a series of transactions with CXL:
- the First Tranche BEL Share Sale Agreement; $(a)$
- $(b)$ the Second Tranche BEL Share Sale Agreement;

and either

An in-specie distribution of all of the shares in CXL to be received by SOF on settlement of $(iii)$ the Second Tranche BEL Share Sale Agreement; or
$(iv)$ If the Second Tranche BEL Share Sale Agreement fails to settle for any reason (including where BEL shareholders fails to approve the transaction) and settlement of both the SCB Option Deed and First Tranche BEL Share Sale Agreement occurs in accordance with their terms, an in-specie distribution of 2,300,000 shares in BEL retained by SOF.
$(2)$ Approval for a series of transactions with CXL:
$\left( i\right)$ The sale to CXL of 3,167,152 SCB shares held by SOF for a consideration per share equal to the last reported NTA (post tax) backing value of SCB per share (to be paid by a combination of \$200,000 cash and new CXL shares priced at CXL's last reported NTA (post tax) backing per share), upon the exercise of CXL's option pursuant to the SOF-SCB Option Deed;
$(ii)$ The sale to CXL of 2,100,000 BEL shares held by SOF for a consideration per share equal to the last reported NTA (post tax) backing value of BEL per share (to be paid by a combination of \$575,000 cash and the issue of new CXL shares priced at CXL's last reported NTA (post tax) backing per share), pursuant to the First Tranche BEL Share Sale Agreement;
The sale to CXL of 2,300,000 BEL shares held by SOF for a consideration per share equal $(iii)$ to the last reported NTA (post tax) backing value of BEL per share (to be paid by the issue of new CXL shares priced at CXL's last reported NTA (post tax) backing per share), pursuant to the Second Tranche BEL Share Sale Agreement.

The above resolutions are interdependent and require both to be passed by SOF shareholders if either of the transactions contemplated within each resolution are to proceed.

The SOF Return of Capital the subject of SOF resolution (1) is also conditional upon settlement of the First Tranche BEL Share Sale Agreement and the SOF-SCB Option Deed. The Company understands this is because Sofcom requires the cash consideration which is payable to it under these agreements in order to have sufficient cash to pay the \$450,000 cash component of the SOF Return of Capital. If settlement of either of these agreements does not occur, the Sofcom Return of Capital will not proceed.

As a result of the transaction contemplated in SOF resolution (2), SOF will (if that resolution is approved) convert all of its share investments (save for 300,000 BEL shares which will be retained for working capital purposes) into cash and shares in CXL.

As a result of the return of capital contemplated in SOF resolution (1), SOF will (if that resolution is approved) distribute all of its surplus cash reserves and all of its share investments (including the cash and shares in CXL obtained pursuant to the transactions contemplated in SOF resolution 2) (save for 300,000 BEL shares referred to above) to shareholders of SOF (which includes the company).

The existing capital structure of, and shareholdings in, SOF will remain unchanged by the return of capital but SOF will be suspended from ASX on the eve of its general meeting.

After payment of all liabilities, SOF expects to have approximately \$50,000 of net cash/liquid assets to maintain the listing of the company on ASX pending the proposed recapitalisation of the company and the undertaking of a transaction to allow for the company to be re-admitted to ASX.

The exact assets to be distributed in specie under the SOF ROC will depend on whether the Second Tranche BEL Share Sale Agreement proceeds to settlement:

$(1)$ If Both BEL Share Sale Agreements and the SOF-SCB Option Deed Proceeds to Settlement

The total amount of the SOF ROC contemplated in SOF resolution (1) comprise \$450,000 cash and the inspecie distribution of SOF's shareholding in CXL which will be issued to SOF as a consequence of the transactions contemplated in SOF resolution (2) (assuming all transactions contemplated in such resolution proceeds to settlement).

The final number of CXL shares received by SOF will depend on the last reported NTA backings (post tax) of BEL, SCB and CXL prior to settlement of the transactions contemplated in SOF resolution (2) (this is likely to be the NTA backings as at 31 May 2005).

Based on the 30 April 2005 NTA backings (post tax) of BEL, SCB and CXL, SOF will receive 1,744,159 CXL shares.

Under the SOF ROC, SOF shareholders will be entitled to participate in the return of capital in the same proportion as their shareholding in SOF.

By way of illustration, the value of the SOF ROC and AEA's share of the same, will be approximately as follows:

The SOF ROC
CXL shares component of ROC	1.744.159
Value of CXL shares at market ⁽³⁾	\$1,037,775
Cash component of ROC	\$450,000
Total value of ROC	\$1,487.775
ROC value per share	$3.33$ cents
(The ROC value per share based on the NTA backing of CXL shares ⁽²⁾	4.95 cents)

. . . . $\sim$ 100 الوالي ليوني الوراث الروازي

AEA's share of the SOF ROC		Cash ROC		CXL Shares Component of ROC
Total SOF Shares Held	% Issued Capital		No. of CXL Shares	Value of CXL Shares at Market (1)	Value of CXL Shares at NTA Backing ⁽²⁾
36,258,535	81.23%	\$365,522	1,416.730	\$842.954	\$1,430,897
(1)	These figures may change. They have been based on CXL's closing price on ASX on 19 May 2005 of \$0.595 per share;

$(2)$ These figures may change. They have been based on CXL's 30 April 2005 NTA (post tax) backing of \$1.01 per share.

As previously indicated, the SOF Return of Capital is subject to and conditional upon settlement of the First Tranche BEL Share Swap Agreement and the SCB Option Deed between SOF and CXL. If settlement of either of these agreements does not occur for any reason, the SOF Return of Capital will not proceed.

$(2)$ If Second Tranche BEL Share Sale Agreement Does Not Proceed to Settlement

If the Second Tranche BEL Share Sale Agreement fails to settle for any reason and the First Tranche BEL Share Swap Agreement and the SOF-SCB Option Deed proceeds to settlement, SOF will undertake the inspecie distribution of 2,300,000 shares in BEL retained by SOF.

SOF will still proceed with the \$450,000 cash ROC and the in-specie distribution of CXL shares issued pursuant to the First Tranche BEL Share Swap Agreement and the SOF-SCB Option Deed.

By way of illustration, the value of the SOF ROC and AEA's share of the same, will be as approximately follows:

The SOF ROC

CXL shares component of ROC	770,644
Value of CXL shares at market ⁽³⁾	\$458,533
BEL shares component of ROC	2,300,000
Value of BEL shares at market ⁽²⁾	\$736,000
Cash component of ROC	\$450,000
Total value of ROC	\$1.644,533
ROC value per share	3.68 cents
(The ROC value per share based on the NTA backing of CXL shares ⁽²⁾ and BEL shares ⁽⁴⁾	$4.95$ cents)

AEA's share of the SOF ROC

	Cash ROC	CXL Shares Component of ROC			BEL Shares Component of ROC
		No. of CXL Shares	Value of CXL Shares at Market ⁽¹⁾	Value of CXL Shares at NTA Backing -69	No. of BEL Shares	Value of BEL Shares at Market ⁽²⁾	Value of BEL Shares at NTA Backing ⁽⁴⁾
	\$365.522	625.972	\$372,453	\$632.232	1.868.223	\$597.831	\$798,665
(1)	These figures may change. They have been based on CXL's closing price on ASX on 19 May 2005 of \$0.595 per share;
(2)	These figures may change. They have been based on BEL's closing price on ASX on 19 May 2005 of \$0.32 per share;

$(3)$ These figures may change. They have been based on CXL's 30 April 2005 NTA (post tax) backing of \$1.01 per share;

$(4)$ These figures may change. They have been based on BEL's 30 April 2005 NTA (post tax) backing of \$0.4275 per share.

3.2 Sale of SCB Shares

During the 2004/2005 financial year, to meet ongoing expenses the Company disposed of 51,282 SCB shares on market realising gross proceeds of \$12,261 and a loss on disposal of \$158 (calculated on a "first in first out (FIFO) basis).

The Company's current holding of 698,718 shares in SCB has a cost base of \$169,725 (after accounting for previous disposals on a FIFO basis).

Under the SCB Option Deed with CXL, the Company will (subject to settlement of that agreement) receive \$144,635 cash consideration from the sale of its SCB shares to CXL, based on SCB's last reported 30 April 2005 NTA (post tax) backing of \$0.207 per share.

3.3 Amount and Source of Return of Capital

The actual value of the Return of Capital will depend on:

Whether the SOF Return of Capital proceeds; $\left(\mathbf{i}\right)$
$(ii)$ Whether the Second Tranche BEL Share Sale Agreement between SOF and CXL proceeds to settlement;
$(iii)$ The extent of CXL shares and BEL (if any) which may be received by AEA under the SOF Return of Capital;
$(iv)$ The value of the CXL shares referred to in (iii) above, as determined by the reported NTA backings (post tax) of BEL, SCB and CXL shares prior to settlement of SOF's BEL Share Sale Agreements and the SOF-SCB Option Deed with CXL (expected to be the after tax NTA backings reported as at 31 May 2005, which is due to be reported by each company to ASX by 14 June 2005);
$(v)$ The value of the BEL shares referred to in (iii) above;
$(v_i)$ The market value of CXL shares (and potentially BEL shares) as at the date of the in-specie distribution of such shares to Shareholders;
The NTA backing of SOF shares as at the date of the in-specie distribution of such shares to $(vii)$ Shareholders.

The tables below are illustrative of the value of the Return of Capital based on the NTA (post tax) backings of BEL, SCB and CXL per share as at 30 April 2005 and the market values of CXL and BEL shares as at 19 May 2005.

The Company will inform Shareholders prior to the General Meeting with updated information on the value of the Return of Capital based on the 31 May 2005 NTA backings released by BEL, SCB and CXL.

Under the ROC, Shareholders will be entitled to participate in the Return of Capital in the same proportion as their shareholding in the Company as at the Record Date. For example, if a shareholder has a 1% interest in the Company, it will receive 1% of the Company's shareholdings in CXL and SOF (and potentially BEL).

Scenario 1 - The SOF ROC comprises Cash and CXL Shares - Distribution of CXL and SOF Shares Under the AEA ROC

This scenario assumes that SOF is able to settle both its BEL Share Sale Agreements and the SOF-SCB Option Deed with CXL and will accordingly undertake the SOF ROC of \$450,000 cash and CXL shares to shareholders.

Please refer to Section 3.1(1) of this Notice of Meeting and Explanatory Statement for further details on the SOF ROC in such scenario and AEA's share of cash and CXL shares under the same.

By way of illustration, the value of the Return of Capital to Shareholders will be approximately as follows:

The AEA ROC

CXL shares component of ROC	1.416,730
Value of CXL shares at market ⁽³⁾	\$842,954
SOF shares component of ROC	36,258,535
Value of SOF shares post SOF ROC at NTA backing (2)	\$40,614
Total value of ROC	\$883,568
ROC per share	$1.42$ cents
(The ROC value per share based on the NTA backing of CXL shares ⁽³⁾ and SOF shares ⁽²⁾	2.37 cents)

Under the ROC, Shareholders will receive the SOF and CXL Shares (not cash) in proportion to their shareholding in AEA:

Total AEA Shares Held	No. of CXL Shares	Value of CXL Shares at Market	Value of CXL Shares at NTA Backing	No. of SOF Shares	Value of SOF Shares at NTA Backing
1,000,000	22,844	\$13,592	\$23.072	584.643	\$655
500.000	11,422	\$6,796	\$11,536	292.322	\$327
100.000	2,284	\$1,359	\$2,307	58.464	\$65
50,000	1.142	\$680	\$1.154	29.232	\$33
25.000	571	\$340	\$577	14.616	\$16
10.000	228	\$136	\$231	5,846	\$7
5,000	114	\$68	\$115	2.923	\$3

These figures may change. They have been based on CXL's closing price on ASX on 19 May 2005 of \$0.595 per share; $(1)$

$(2)$ These figures may change. They have been based on an assumed SOF NTA backing (post SOF ROC) of 0.11 cents per share (based on an estimated \$50,000 net cash reserves);

These figures may change. They have been based on CXL's 30 April 2005 NTA (post tax) backing of \$1.01 per share; $(3)$

Scenario 2 - The SOF ROC comprise Cash, CXL, SOF and BEL Shares - Distribution of CXL, BEL and SOF Shares Under the AEA ROC

This scenario assumes that the SOF Second Tranche BEL Share Sale Agreement fails to settle (and the First Tranche BEL Share Sale Agreement and SOF-SCB Option Deed proceeds to settlement) and accordingly SOF will undertake its ROC of \$450,000 cash, a reduced balance of CXL shares and 2.3 million BEL shares.

Please refer to Section 3.1(2) of this Notice of Meeting and Explanatory Statement for further details on the SOF ROC in such scenario and AEA's share of cash, CXL and BEL shares under the same.

By way of illustration, the value of the Return of Capital to Shareholders will be approximately as follows:

The AEA ROC

CXL shares component of ROC	625,972
Value of CXL shares at market ⁽³⁾	\$842,954
SOF shares component of ROC	36,258,535
Value of SOF shares post SOF ROC at NTA backing (2)	\$40,614
BEL shares component of ROC	1.868,223
Value of BEL shares at market ⁽³⁾	\$597.831
Total value of ROC	\$1,096,978
ROC per share	$1.77$ cents
(The ROC value per share based on the NTA backing of CXL ⁽⁴⁾ , BEL ⁽⁵⁾ and SOF shares ⁽²⁾	$2.37$ cents)

Under the ROC, Shareholders will receive the SOF, CXL and BEL shares (not cash) in proportion to their shareholding in AEA:

Total AEA Shares Held	No. of CXL Shares	Value of CXL Shares at Market ⁽¹⁾	Value of CXL Shares at NTA Backing ⁽⁴⁾	No. of BEL Shares	Value of BEL Shares at Market ⁽³⁾	Value of BEL Shares at NTA Backing ⁽⁵⁾	No. of SOF Shares	Value of SOF Shares at NTA Backing $\langle Z \rangle$
1.000.000	10.093	\$6,006	\$10,194	30,124	\$9,640	\$12,878	584,643	\$655
500,000	5.047	\$3,003	\$5,097	15,062	\$4,820	\$6,439	292,322	\$327
100,000	1.009	\$601	\$1,019	3,012	\$964	\$1,288	58.464	\$65
50,000	505	\$300	\$510	1,506	\$482	\$644	29,232	\$33
25,000	252	\$150	\$255	753	\$241	\$322	14,616	\$16
10,000	101	\$60	\$102	301	\$96	\$129	5,846	\$7
5,000	50	\$30	\$51	151	\$48	\$64	2.923	\$3

$(1)$ These figures may change. They have been based on CXL's closing price on ASX on 19 May 2005 of \$0.595 per share;

These figures may change. They have been based on an assumed SOF NTA backing (post SOF ROC) of 0.11 cents per share (based on $(2)$ an estimated \$50,000 net cash reserves);
These figures may change. They have been based on BEL's closing price on ASX on 19 May 2005 of \$0.32 per share; $(3)$
These figures may change. They have been based on CXL's 30 April 2005 NTA (post tax) backing of \$1.01 per share; $(4)$
$\left(5\right)$ These figures may change. They have been based on BEL's 30 April 2005 NTA (post tax) backing of \$0.4275 per share.

3.4 Capital Structure

The Company has 62,018,213 fully paid ordinary shares on issue as at the date of this Explanatory Memorandum.

The number of Shares on issue in the Company will not change as a result of the transactions contemplated in Resolutions 1 and 2.

3.5 Shareholdings in the Company

The ROC contemplated in Resolution 1 does not alter the shareholding of individual shareholders in the Company. All shareholders will participate equally in the ROC in proportion with their shareholding in the Company.

Shareholders entitled to receive the CXL and SOF shares (and potentially BEL shares) under the ROC will retain their shareholding in the Company after the ROC. The value of Shareholders' Shares in the Company after the Return of Capital will be substantially reduced: the Shares will have a nominal value only.

3.6 Effect of Return of Capital on Share Capital

After the Return of Capital, the current value of the share capital of the Company will be reduced by the value of the Return of Capital (for further details, see section 3.3).

4. TAXATION

The Company has sought a Class Ruling from the Australian Tax Office (ATO) as to the tax implications of the Return of Capital.

The Company will issue a market announcement once it receives the ATO's Class Ruling.

The Company advises that, for specific taxation advice, shareholders should consult their own taxation adviser so that their particular circumstances are taken into consideration.

The Company advises Shareholders to complete the Tax File Number (TFN) Notification Form enclosed with this Notice of Meeting and Explanatory Memorandum to ensure that no TFN withholding tax is required to be deducted from your share of the Return of Capital (if such withholding is required under the taxation laws).

5. SUSPENSION FROM ASX

The Company will remain suspended from ASX.

The Company's suspension will continue until the Company fully re-complies with Chapters 1 and 2 of the Listing Rules, including a capital reconstruction to ensure a price of at least \$0.20 for the Company's shares, lodgement of a full form prospectus (if a capital raising is required) and satisfaction of minimum shareholder spread requirements.

The Company will retain sufficient cash reserves of approximately \$50,000 after the ROC to support its ongoing reporting and disclosure obligations to the ASX and shareholders as a public listed company.

The Directors will continue to pursue a transaction for the recapitalisation and re-admission of the Company on ASX. The Board is in discussions with parties in relation to the recapitalisation of the Company and the undertaking of a transaction that will facilitate the Company's re-admission to ASX, after the Return of Capital. The Board hopes to be able to announce a concluded transaction path in this regard within the next 6 months, however no guarantee can be provided that the Company's re-admission to ASX will be successful.

Whilst the Board will endeavour to effect a recapitalisation of the Company which will include undertaking a new transaction which will require prior shareholder approval to facilitate the recommencement in trading of the Company shares on the ASX, this objective cannot be guaranteed. Where such matters cannot be achieved and the existing capital of the Company is not sufficient (or where further capital cannot be raised) to meet its expenses as a suspended listed "shell", the Board will seek a delisting of the Company and potentially a winding up of the Company. The Board notes that ASX may also require a delisting in the future if the Company is unable to propose a suitable new transaction for the recapitalisation and readmission of the Company on ASX.

About CXL and BEL 6.

About Central Exchange Limited (CXL) $6.1$

CXL is an investment company listed on ASX (ASX Code: CXL) with net assets of \$17.23 million (pre tax) and \$16.73 million (post tax) based on its last reported NTA backing for 30 April 2005.

Shareholders should refer to the December 2004 Half Year Reports of CXL accompanying this Notice of Meeting and Explanatory Memorandum for further information about CXL, including its investment objectives and strategies (an extract of which is reproduced below).

Investment Objectives

The Investment Objectives of the Company are to:

Achieve a consistent high real rate of return, comprising both income and capital growth, whilst operating within acceptable risk parameters set by the Board;
Deliver a regular income stream for shareholders in the form of franked dividends;
Preserve and protect the capital of the Company.

Investment Strategies

The Company seeks to implement an actively managed investment strategy undertaking investments typically into one of two broad investment categories:

Strategic Investments investments in which the Company can reasonably expect to exert a degree of influence, including board representation or through playing an active role alongside management in order to enhance or realise shareholder value; and
Non-strategic Investments investments in entities where attractive investment opportunities develop due to market sentiment or mispricing or where the Company sees other potential for generating positive returns."

CXL's 2004 Annual Report can be viewed and downloaded from CXL's website: www.centralexchange.com.au. A copy of this report can be emailed or posted to shareholders upon request.

As a listed investment company, CXL discloses its NTA backing each month. CXL's last reported Gross NTA was \$16.73 million with a NTA Backing (post tax) of \$1.01 per share.

CXL's closing market price on 19 May 2005 was 59.5 cents per share.

				NTA Backing	Gross NTA
Month Ending	ASX	ASX.	ASX	(post tax)	(post tax)
	High	Low	VWAP	per share	\$ 'millions
$31 - Jul - 04$	\$0.850	\$0.570	\$0.659	\$1.057	\$18.196
31-Aug-04	\$0.640	\$0.530	\$0.573	\$1.050	\$18.086
30-Sep-04	\$0.610	\$0.540	\$0.569	\$1.062	\$18,280
31-Oct-04	\$0.630	\$0.560	\$0.585	\$1.079	\$18.575
30-Nov-04	\$0,700	\$0.580	\$0.616	\$1.082	\$18.631
31-Dec-04	\$0.650	\$0.590	\$0.607	\$1.124	\$19,358
31-Jan-05	\$0.670	\$0.600	\$0.626	\$1.111	\$19.137
28-Feb-05	\$0.650	\$0.600	\$0.629	\$1.103	\$18,986
31-Mar-05	\$0.680	\$0.580	\$0.613	\$1.052	\$18.122
30-Apr-05	\$0.625	\$0.600	\$0.609	\$1.009	\$16,730
19-May-05	\$0.625	\$0.595	\$0.614	N/A	N/A

CXL's recent reported NTA backings (post tax), VWAP and high and low trading prices on ASX are as follows:

SOF Director and Company Secretary, Mr Victor Ho, is also a director and Company Secretary for CXL. SOF Chairman, Mr Faroog Khan, is also the Chairman of ASX listed Queste Communications Limited (ASX Code: QUE), currently a controlling 50% shareholder of CXL. Mr Farooq Khan is also a member of the Investment Committee of CXL (at the invitation of CXL).

Shareholders are also referred to www.centralexchange.com.au for other relevant information concerning CXL.

6.2 About Bentley International Limited (BEL)

BEL is an investment company which listed on ASX in October 1986 with the objective of achieving medium to long term capital appreciation together with fully franked dividends through investment in securities listed on the world's sharemarkets. BEL's investment portfolio is managed by Constellation Capital Management Limited, whose mandate is to implement the International equities component of Constellation's HomeGlobal^tw investment strategy.

BEL's December 2004 Half Year Reports and 2004 Annual Report can be viewed and downloaded from BEL's website: www.bel.com.au. A copy of such reports can be emailed or posted to shareholders upon request.

As a listed investment company, BEL discloses its NTA backing each month. BEL's last reported NTA (pre and post tax) was \$16.65 million with its last reported NTA Backing (post tax) as at 30 April 2005 of \$0.428 per share.

BEL's closing market price on 19 May 2005 was 32 cents per share.

For Month Ending	ASX	ASX	ASX	NTA Backing
	High	Low	VWAP	Post Tax
$31 - Jul - 04$	\$0.400	\$0.355	\$0.375	\$0.466
31-Aug-04	\$0.400	\$0.375	\$0.393	\$0.467
30-Sep-04	\$0.410	\$0.380	\$0.397	\$0.436
31-Oct-04	\$0.410	\$0.345	\$0.394	\$0.430
30-Nov-04	\$0.385	\$0.375	\$0.378	\$0.435
31-Dec-04	\$0.380	\$0.370	\$0.375	\$0.443
31-Jan-05	\$0.385	\$0.370	\$0.376	\$0.434
28-Feb-05	\$0.380	\$0.370	\$0.375	\$0.436
31-Mar-05	\$0.380	\$0.350	\$0.366	\$0.439
30-Apr-05	\$0.350	\$0,330	\$0.338	\$0.428
19-May-05	\$0.340	\$0.265	\$0.313	N/A

BEL's recent reported NTA backings (post tax), VWAP and high and low trading prices on ASX are as follows:

SOF Directors, Messrs Farooq Khan and Simon Cato are also directors of BEL.

Shareholders are also referred to www.bel.com.au for other relevant information concerning BEL.

$7.$ Resolution 1 - Return of Capital

Resolution 1 seeks shareholder approval for the Company to undertake an equal reduction of its share capital by the Return of Capital to shareholders, being:

An in-specie distribution of all of the shares in CXL that may be received by the Company under the $(1)$ SOF Return of Capital;
$(2)$ An in-specie distribution of all of the shares in BEL (if any) that may be received by the Company under the SOF Return of Capital; and
$(3)$ An in-specie distribution of all of the shares in SOF held by the Company.

The Return of Capital will only be carried out (notwithstanding shareholder approval of Resolution 1) if shareholders have approved Resolution 2.

If both the SOF and CXL First Tranche BEL Share Sale Agreement and SOF-SCB Option Deed do not proceed to settlement, SOF will not be undertaking the SOF Return of Capital and AEA will not receive a distribution of cash or CXL (and potentially BEL) shares from SOF.

The Company will not proceed with the in-specie distribution of its shareholding in SOF unless SOF completes the SOF Return of Capital.

$7.1$ Section 256 Corporations Act

Under section 256B(1) of the Corporations Act, a company may reduce its share capital as long as the reduction:

is fair and reasonable to the Company's Shareholders as a whole the Directors of the Company $(a)$ consider that the Return of Capital is fair and reasonable to all Shareholders of the Company, as it applies to all Shareholders equally having regard to the number of shares in the Company held by each of them.
$(b)$ does not materially prejudice the Company's ability to pay its creditors - the Directors of the Company believe that the Company has sufficient cash reserves/net assets to fund the Return of Capital without materially prejudicing the Company's ability to pay its creditors. However shareholders should note earlier comments about the ultimate future of the Company with its post Return of Capital assets and the possible winding up of the Company should a suitable recapitalisation plan not be achieved.
is approved by Shareholders under section 256C for the purposes of section 256C of the $(c)$ Corporations Act, the proposed Return of Capital is treated as an equal reduction of capital and requires approval by an ordinary resolution. The Return of Capital is an equal reduction as it relates only to ordinary Shares, it applies to each holder equally and the terms of the Return of Capital are the same for each holder of Shares.

$7.2$ Clauses 137 and 138 of Constitution

Clauses 137 and 138 of the Constitution of the Company governs the Return of Capital proposed in Resolution 1.

'REDUCTIONS OF CAPITAL

1. Company may Reduce Share Capital
137.1 The Company may reduce its share capital by any means allowed by the Act, subject to the Company complying with the Listing Rules.
1. Reduction of Share Capital by Asset Distribution
138.1 Any reduction in share capital under rule 137 may be made wholly or partly by way of an in specie distribution of specific assets, including paid up shares in, or debentures of, or options over the shares of, the Company or any other body corporate.
138.2 Where a difficulty arises in regard to a distribution of specific assets referred to in rule 138.1, the directors may resolve the difficulty as they see fit.
138.3 The directors may:
fix the value for distribution of the specific assets or any part of those assets; $\langle \eta \rangle$
$(2)$ determine that cash payments will be made to any members on the basis of the value so fixed in order to adjust the rights of all parties; and
$(3)$ vest any of those specific assets in trustees;

as the directors see fit.

138.4 Where the Company reduces its share capital by way of a distribution of shares or other securities in another body corporate:
$(1)$ the members are deemed to have agreed to become members of that corporation and are bound by the constitution of that body corporate; and

$(2)$ each of the members appoints the Company or any of the directors as its agent to execute any transfer of shares or other securities, or other document required to give effect to the distribution of shares or other securities to that member."

7.3 ASX Listing Rule 7.20

The following information is provided for the purposes of ASX Listing Rule 7.20:

The proposed Return of Capital will not change the number of Shares held by each Shareholder in $(a)$ the Company (or the amount, if any, unpaid on their Shares).
$(b)$ The number of shares in CXL, SOF (and potentially BEL) to be distributed to Shareholders under the Return of Capital shall be determined on a pro-rata basis in proportion to each Shareholder's interest in the Company as at the Record Date. Fractional entitlements will be rounded to the nearest whole share and the Directors are authorised to deal with any difficulties arising in this regard as they see fit pursuant to clause 138.2 of the Company's Constitution.
At the date of this Explanatory Memorandum, the Company has the following unlisted options on $(c)$ issue:

Nature of Unlisted Options on issue	Number	Exercise Price	Expiry Date
"Promoter" Options	18.000.000	70 cents	30 June 2005
"Incentive" Options	1.090.000	25 cents	13 April 2005
"15 May 2007" Options	2.500.000	$7.50$ cents	15 May 2007

The exercise price in respect of such options will be reconstructed in accordance with the terms of such options and the ASX Listing Rules.

$7.4$ Directors' Interests and Recommendations

No Director holds any Shares in the Company and accordingly no statements as to their voting intentions with respect to this resolution are required.

All of the Directors recommend that Shareholders approve Resolution 1.

Please also refer to Section 1.4.

8. Resolution 2 - Sale of Shares

Resolution 2 seeks shareholder approval for the sale to CXL of 698,718 SCB shares held by the Company for a consideration per share equal to the last reported NTA (post tax) backing value of SCB per share, the total consideration to be paid by cash, pursuant to the SCB Option Deed:

Subject to settlement of that agreement, based on SCB's last reported 30 April 2005 NTA (post tax) backing of \$0.207 per share, the Company will receive \$144,635 cash consideration from the sale of its SCB shares to CXL.

$8.1$ SCB Option Deed

On 2 May 2005, the Company entered into the Option Deed with CXL where the Company granted an option to CXL for CXL to acquire 698,718 SCB shares held by the Company for a consideration per share equal to the last reported NTA backing value of SCB per share with the total consideration to be paid by the issue of new CXL shares priced at CXL's last reported NTA backing. The option exercise period expires at 5:00pm (Perth time) on 2 August 2005. The Option Deed was also subject to compliance with the Corporations Act and ASX Listing Rules.

On 30 May 2005, the Company and CXL entered into a deed of variation to the Option Deed whereby the purchase consideration was amended to be a consideration per share equal to the last reported NTA (post tax) backing value of SCB per share with the total consideration to be paid by cash.

The references to NTA backings in respect of SCB and CXL shares are references to the last reported NTA (post tax) backings of such companies prior to settlement - this is expected to be the NTA backings reported as at 31 May 2005, on the basis that the exercise under the Option Deed will settle on 30 June 2005.

The Option Deed is conditional upon the satisfaction by 29 July 2004 (unless condition (b) is waived by CXL) of the following conditions precedent:

AEA's shareholders approving the sale of the 698,718 SCB shares to CXL upon exercise of CXL's $(a)$ option on the terms and conditions of the Option Deed;
AEA's shareholders approving the Return of Capital. $(b)$

8.2 Conclusion of Independent Expert

BDO Consultants are of the opinion that the proposed transaction contemplated in Resolution 2 is FAIR AND REASONABLE to the non-associated shareholders of the Company.

The Independent Experts' Report accompanies this Notice of Meeting and Explanatory Memorandum and Shareholders are encouraged to read the full text of such report.

8.3 Directors' Recommendations

All of the Directors (save for Mr Victor Ho who makes no recommendation as he is a director of CXL) recommend that Shareholders approve Resolution 2.

The Company notes that Mr Khan is a director and substantial shareholder of Queste Communications Limited, which is a 50% controlling shareholder of CXL and that Messrs Khan, Cato and Ho are directors of Altera Capital Limited, which is an 81% controlling shareholder of Sofcom.

Please also refer to Section 1.4.

$9_z$ GLOSSARY

ADG means Alan Davis Group Pty Limited ABN 22 000 762 489.

AWST or Perth time means Australian Western Standard Time.

ASIC means Australian Securities and Investments Commission.

Associate has the meaning given to it by sections 10 to 17 of the Corporations Act.

ASX means Australian Stock Exchange Limited ACN 008 624 691.

BEL means Bentley International Limited ABN 87 008 108 218.

BEL Share Sale Agreements means the First Tranche BEL Share Sale Agreement and the Second Tranche BEL Share Sale Agreement.

BDO Consultants means BDO Consultants (WA) Pty Ltd ABN 92 008 864 435.

Board means the board of Directors unless the context indicates otherwise.

Business Day means a day other than a Saturday or Sunday on which banks are open for business in Perth, Western Australia.

Central Exchange or CXL means Central Exchange Limited ACN 000 742 843.

Company or Altera Capital or AEA means Altera Capital Limited ACN 082 541 437.

Constitution means the constitution of the Company.

Corporations Act and Act means the Corporations Act 2001 (Cth).

Corporations Regulations means the Corporations Regulations 2001 (Cth)

Directors means the directors of the Company from time to time.

Dollars or \$ means Australian dollars unless otherwise stated.

Fast Scout or FSL means Fast Scout Limited ACN 088 488 724.

FIFO means first-in-first-out.

First Tranche BEL Share Sale Agreement means the agreement dated 30 May 2005 between SOF and CXL in relation to the sale of SOF's 2,100,000 BEL shares to CXL.

General Meeting means the general meeting of the Company to be held at 11:30 am (Perth time) on Thursday, 30 June 2005.

Glossary means this glossary.

Independent Expert means BDO Consultants.

Listing Rules means Listing Rules of the ASX.

LIC means listed investment company, which is an investment company listed on ASX.

Notice of Meeting and Explanatory Memorandum means this notice of meeting and explanatory memorandum document dated 31 May 2005 despatched to Shareholders of the Company in relation to the General Meeting.

NTA means net tangible assets.

Record Date means the date for determining entitlements to participate in the Return of Capital, being midnight on 8 July 2005.

Return of Capital or ROC means the return of capital proposed in Resolution 1 and as outlined in this Notice of Meeting and Explanatory Memorandum.

SCB means Scarborough Equities Limited ABN 58 061 287 045 (formerly Rivkin Financial Services Limited).

SCB Option Deed means the deed dated 2 May 2005 between the Company and CXL (as amended) in relation to the sale of the Company's 698,718 SCB shares to CXL, as described in Section 8.1 of this Notice of Meeting and Explanatory Memorandum.

Second Tranche BEL Share Sale Agreement means the agreement dated 30 May 2005 between SOF and CXL in relation to the sale of SOF's 2,300,000 BEL shares to CXL.

Share(s) means fully paid ordinary shares in the Company.

Shareholder(s) means holders of Shares.

Sofcom or SOF means Sofcom Limited ACN 087 482 602.

SOF Return of Capital or SOF ROC means the share capital return under section 256B and 256C(1) of the Corporations Act proposed by SOF which is the subject of SOF shareholder approval at a general meeting to be held on 30 June 2005 and which is described in Section 3.1 of this Explanatory Memorandum.

SOF-SCB Option Deed means the deed dated 2 May 2005 between SOF and CXL (as amended) in relation to the sale of SOF's 3,167,152 SCB shares to CXL.

VWAP means volume weighted average price.

www.alteracapital.com

ALTERA CAPITAL LIMITED A.B.N. 55 082 541 437

REGISTERED OFFICE:

Level 14, The Forrest Centre 221 St Georges Terrace Perth Western Australia 6000 T | (08) 9214 9787 F | (08) 9322 1515 $E$ | [email protected]

ASX CODE: AEA

ADVANCED SHARE REGISTRY SERVICES:

110 Stirling Highway Nedlands Western Australia 6009 T | (08) 9389 8033 F | (08) 9389 7871 E | [email protected] W | www.asrshareholders.com.au

PROXY FORM

Altera Capital Limited

A.B.N. 55 082 541 437

Mark this box with an 'X' if you want to make any changes to your address details (see reverse)

COMPLETE AND RETURN TO: The Company Secretary Altera Capital Limited Level 14, The Forrest Centre 221 St Georges Terrace Perth Western Australia 6000

Facsimile: (08) 9322 1515

Appointment of Proxy

I/We being a member/s of Altera Capital Limited and entitled to attend and vote hereby appoint

Chairman of the The OR. Meeting (mark with an "X")

Write here the name of the person you are appointing if this person is someone other than the Chairman of the Meeting.

or failing the person named, or if no person is named, the Chairman of the Meeting, as my/our proxy to act generally at the meeting on my/our behalf and to vote in accordance with the following directions (or if no directions have been given, as the proxy sees fit) at the General Meeting of Altera Capital Limited to be held at Suite 3, The Forrest Centre Conference Suites, Level 14, The Forrest Centre, 221 St Georges Terrace, Perth, Western Australia at 11:30 am (Perth time) on Thursday, 30 June 2005 and at any adjournment of such General Meeting.

Chairman's Open Proxies

If you do not wish to direct your proxy how to vote, please place a mark in the box. If you have appointed the Chairman of the Meeting to exercise your proxy, by marking this box, you acknowledge that the Chairman of the Meeting may exercise your proxy even if he has an interest in the outcome of a particular resolution and votes cast by him other than as proxy holder will be disregarded because of that interest. The Chairman intends to vote in favour of Resolutions 1 and 2.

Voting directions to your proxy - please mark $[X]$ to indicate your directions

RESOLUTIONS

Approval of Return of Capital 1. 2. Approval of Sale of Shares

Against Abstain*

If to proxies are being appointed, the proportion of voting rights this proxy represents is:

* If you mark the Abstain box for a particular item, you are directing your proxy not to vote on your behalf on a show of hands or on a poll and your votes will not be counted in computing the required majority on a poll.

PLEASE SIGN HERE

This section must be signed in accordance with the instructions overleaf to enable your directions to be implemented.

For

Individual or Shareholder 1	Joint Shareholder 2	Joint Shareholder 3


Sole Director and Sole Company Secretary	Director	Director / Company Secretary


Contact Name	Contact Daytime Telephone	Date
Email

INSTRUCTIONS FOR COMPLETING PROXY FORM

$\mathbf{1}$ . Your pre-printed name and address is as it appears on the Company's share register. If this information is incorrect, please mark the box at the top of the proxy form and make the correction on the form. Shareholders sponsored by a broker should advise their broker of any changes.
$\overline{2}$ . Completion of a proxy form will not prevent individual shareholders from attending the meeting in person if they wish. Where a shareholder completes and lodges a valid proxy form and attends the meeting in person, then the proxy's authority to speak and vote for that shareholder is suspended while the shareholder is present at the meeting.
1. A shareholder of the Company entitled to attend and vote is entitled to appoint not more than two proxies. Where more than one proxy is appointed, each proxy must be appointed to represent a specified proportion of the shareholder's voting rights. If the shareholder appoints two proxies and the appointment do not specify this proportion, each proxy may exercise half of the votes.
$4.$ A proxy need not be a shareholder of the Company.
1. If you mark the abstain box for a particular item, you are directing your proxy not to vote on that item on a show of hands or on a poll and that your shares are not to be counted in computing the required majority on a poll.
If a representative of a company shareholder is to attend the meeting, a properly executed original (or certified copy) of the 6. appropriate 'Appointment of Corporate Representative' should be produced for admission to the meeting. Previously lodged Appointments of Corporate Representative will be disregarded by the Company.
1. If a representative as Power of Attorney of a shareholder is to attend the meeting, a properly executed original (or certified copy) of an appropriate Power of Attorney should be produced for admission to the meeting. Previously lodged Powers of Attorney will be disregarded by the Company.

8. Signing Instructions

You must sign this form as follows in the spaces provided:

Individual:	Where the holding is in one name, the holder must sign.
Joint Holding:	Where the holding is in more than one name, all of the Shareholders should sign.
Power of Attorney:	If you are signing under a Power of Attorney, you must lodge an original or certified photocopy of the appropriate Power of Attorney with your completed Proxy Form.
Companies:	Where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person.
	If the company (pursuant to section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director can also sign alone.
	Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please indicate the office held by signing in the appropriate place.

9. Lodgment of a Proxy

This Proxy Form (and the original or certified copy of any Power of Attorney under which it is signed) must be received at the address below not later than 11:30 am (Perth time) on 28 June 2005 (48 hours before the commencement of the meeting). Any Proxy Form received after that time will not be valid for the meeting.

Proxy Forms may be lodged by posting, delivery or facsimile to the address below:

Altera Capital Limited Level 14, The Forrest Centre 221 St Georges Terrace Perth Western Australia 6000

Facsimile: (08) 9322 1515

TAX FILE NUMBER NOTIFICATION FORM FOR SHAREHOLDERS

Issuer Sponsored SRN: (CHESS Sponsored holders should advise their TFN to their stockbroker) Registered Name and Address (PLEASE PRINT CLEARLY):	ALTERA CAPITAL LIMITED
	A.B.N. 55 082 541 437
	Please complete and return to:
	Advanced Share Registry Services PO Box 1156
	Nedlands WA 6909
	Phone: (08) 9389 8033 Fax: (08) 9389 7871
THIS NOTICE IS ONLY VALID WHEN IT IS SIGNED	Email: [email protected] Website: ww.asrshareholders.com.au

SECTION A - TAX FILE NUMBER

Enter your Tax File Number (TFN) or exemption category. Where applicable, please enter the TFN for either Shareholder 2 or Shareholder 3. Collection of TFN's is authorised by taxation laws. Quotation of your TFN is not compulsory. However, under Australian tax law, an investor who does not provide their TFN or exemption category may have an amount of tax deducted from any payments made equal to the highest marginal tax rate plus medicare levy.

	Shareholder Name(s)			Tax File Number OR TFN Code		Investor Entity Type Non-Resident Country
(1)
(2)
(3)
				Investor Entity Type
ŧ INDIVIDUAL		С COMPANY	T.	TRUST	G	GOVERNMENT ORGANISATION
D	DECEASED INDIVIDUAL	P PARTNERSHIP	S.	SUPERANNUATION FUND	Ω OTHER NON-INDIVIDUAL
TFN Code	Description
333333333				Investor under sixteen - where the investor is a child under the age of sixteen and does not quote a TFN.
44444441	exemption from quoting a TFN may be claimed.			Investor is a pensioner - where the investor is a recipient of a Social Security (age or invalid) or Service (veteran's) pension an
444444442				Investor is a recipient of other eligible Social Security pension or benefit (e.g., Parenting Payment, Widow Allowance, etc). New Start Allowance or Sickness Allowance, etc. are not eligible benefits for exemption purposes.
555555555				Entity not required to lodge an income tax return - the investor entity is exempted from lodging income tax returns.
666666666	Investor in the business of providing consumer or business finance.
77777777	Norfolk Island resident.
888888888				Non-resident - person who is not a resident of Australia. 6" If \$888888888 is used then provide the country of residence.
PLEASE SIGN BELOW
Signature Of Shareholder(s) (All joint holders must sign)				Companies Only - Executed in accordance with the Company's Constitution and the Corporations Act.

(All joint holders must sign).	Corporations Act.
u -
Signature Date	Sole Director and Sole Secretary		Date
u --			مە
Date Signature	Director	Date	Secretary	Date
u --	v
Date. Sinnature	Director	Date	Secretary	Date

Note: If signed under Power of Attorney, the Original or a Certified Copy of the relevant Power of Attorney document must be exhibited to the Registry. The Attorney declares that he/she has had no notice of revocation of the Power of Attorney.

www.alteracapital.com Level 14, The Forrest Centre, 221 St Georges Terrace, Perth Western Australia 6000 Tel: (08) 9214 9787 Email: [email protected]: (08) 9322 1515

FINANCIAL SERVICES GUIDE

AND

INDEPENDENT EXPERT'S REPORT

ALTERA CAPITAL LIMITED

30 MAY 2005

BDO Consultants (WA) Ptv Ltd

Level 8, 256 St George's Terrace Perth WA 6000 PO Box 7426 Cloisters Square Perth WA 6850 Tel: (61-8) 9360 4200 Fax: (61-8) 9481 2524 AFS Licence Number 246328 Email: [email protected] www.bdo.com.au

Financial Services Guide

30 May 2005

BDO Consultants (WA) Pty Ltd ABN 92 008 864 435 ("BDO Consultants" or "we" or "us" or "ours" as appropriate) has been engaged by Altera Capital Limited ("AEA") to provide an independent expert's report on the proposal to sell shares in Scarborough Equities Limited to Central Exchange Limited. You will be provided with a copy of our report as a retail client because you are a shareholder of AEA.

Financial Services Guide

In the above circumstances we are required to issue to you, as a retail client, a Financial Services Guide ("FSG"). This FSG is designed to help retail clients make a decision as to their use of the general financial product advice and to ensure that we comply with our obligations as financial services licensees.

This FSG includes information about:

Who we are and how we can be contacted;
The services we are authorised to provide under our Australian Financial Services Licence, Licence No. 246328:
Remuneration that we and/or our staff and any associates receive in connection with the general financial product advice:
Any relevant associations or relationships we have; and
Our internal and external complaints handling procedures and how you may access them.

Information about us

BDO Consultants (WA) Pty Ltd is ultimately owned by the Perth partnership of BDO. BDO and its related entities provide services primarily in the areas of audit, tax, consulting and financial advisory services. Our directors are partners in the Perth partnership of BDO.

The Perth partnership of BDO is a member firm of BDO in Australia, a national association of separate partnerships and entities. The financial product advice in our report is provided by BDO Consultants (WA) Pty Ltd and not by the Perth partnership of BDO or its related entities.

We do not have any formal associations or relationships with any entities that are issuers of financial products. However, you should note that we and the Perth partnership of BDO (and its related entities) might from time to time provide professional services to financial product issuers in the ordinary course of business.

Financial services we are licensed to provide

We hold an Australian Financial Services Licence that authorises us to provide general financial product advice to retail and wholesale clients in relation to proposed or actual mergers, acquisitions, takeovers, corporate restructures or share issues in relation to:

derivatives limited to old law securities options contracts and warrants;
debentures, stocks or bonds issued or proposed to be issued by a government;
interests in managed investments schemes (excluding investor directed portfolio services); ٠
securities; and
superannuation.

When we provide the authorised financial services we are engaged to provide expert reports in connection with the financial product of another person. Our reports indicate who has engaged us and the nature of the report we have been engaged to provide. When we provide the authorised services we are not acting for you.

General Financial Product Advice

We only provide general financial product advice, not personal financial product advice. Our report does not take into account your personal objectives, financial situation or needs.

You should consider the appropriateness of this general advice having regard to your own objectives, financial situation and needs before you act on the advice.

Financial Services Guide

Page 2

Fees, Commissions and Other Benefits that we may receive

We charge fees for providing reports, including this report. These fees are negotiated and agreed with the person who engages us to provide the report. Fees are agreed on an hourly basis or as a fixed amount depending on the terms of the agreement. The fee for this engagement will be approximately \$6,000.

Except for the fees referred to above, neither BDO Consultants, nor any of its directors, employees or related entities, receive any pecuniary benefit or other benefit, directly or indirectly, for or in connection with the provision of the report.

Remuneration or other benefits received by our employees

All our employees receive a salary. Our employees are eligible for bonuses based on overall productivity but not directly in connection with any engagement for the provision of a report.

We have received a fee from AEA for our professional services in providing this report. That fee is not linked in any way with our opinion as expressed in this report.

Referrals

We do not pay commissions or provide any other benefits to any person for referring customers to us in connection with the reports that we are licensed to provide.

Complaints resolution

Internal complaints resolution process

As the holder of an Australian Financial Services Licence, we are required to have a system for handling complaints from persons to whom we provide financial product advice. All complaints must be in writing addressed to The Complaints Officer, BDO Consultants (WA) Pty Ltd, PO Box 7426 Cloisters Square, Perth WA 6850.

When we receive a written complaint we will record the complaint, acknowledge receipt of the complaint within 15 days and investigate the issues raised. As soon as practical, and not more than 45 days after receiving the written complaint, we will advise the complainant in writing of our determination.

Referral to External Dispute Resolution Scheme

A complainant not satisfied with the outcome of the above process, or our determination, has the right to refer the matter to the Financial Industry Complaints Service Limited ("FICS"). FICS is an independent company that has been established to provide free advice and assistance to consumers to help in resolving complaints relating to the financial service industry. FICS will be able to advise you as to whether or not they can be of assistance in this matter. Our FICS Membership Number is F-3820.

Further details about FICS are available at the FICS website www.fics.asn.au or by contacting them directly via the details set out below.

Financial Industry Complaints Services Limited PO Box 579 Collins Street West Melbourne VIC 8007 Toll free: 1300 780 808 Facsimile: (03) 9621 2291 Email: [email protected]

Contact details

You may contact us using the details set out at the top of our letterhead on page 1 of this FSG.

ALTERA CAPITAL LIMITED

INDEPENDENT EXPERT'S REPORT

$\mathbf{1}$ .	INTRODUCTION
2.	SUMMARY AND OPINION
3.	DETAILS OF THE PROPOSAL
$\overline{4}$ .	BASIS OF EVALUATION
5.	BACKGROUND OF ALTERA CAPITAL LIMITED
6.	BACKGROUND OF SCARBOROUGH EQUITIES LIMITED
7.	VALUATION METHODOLOGIES
8.	VALUATION OF SCB
9.	IS THE PROPOSAL FAIR?
10.	OTHER CONSIDERATIONS
	11. Is THE PROPOSAL REASONABLE?
	12. CONCLUSION
	13. SOURCES OF INFORMATION
14.	INDEPENDENCE
	15. QUALIFICATIONS
	16. DISCLAIMERS AND CONSENTS
	APPENDIX I GLOSSARY OF TERMS

BDO Consultants (WA) Pty Ltd

Level 8, 256 St George's Terrace Perth WA 6000 PO Box 7426 Cloisters Square Perth WA 6850 Tel: (61-8) 9360 4200 Fax: (61-8) 9481 2524 AFS Licence Number 246328 Email: [email protected] www.bdo.com.au

Our ref: SA/SK/760

30 May 2005

The Directors Altera Capital Limited Level 14 221 St George's Terrace PERTH WA 6000

Dear Sirs

INDEPENDENT EXPERT'S REPORT

1. INTRODUCTION

BDO Consultants (WA) Pty Ltd ("BDO") has been engaged by Altera Capital Limited ("AEA" or "the Company") to prepare an Independent Expert's Report (the/our "Report") to express an opinion as to whether or not the proposal to sell ordinary shares in Scarborough Equities Limited ("SCB") to Central Exchange Limited ("CXL") for cash consideration ("the Proposal") is fair and reasonable to non-associated shareholders ("Shareholders") of AEA. AEA holds 698,718 ordinary shares in SCB. Our Report is to be included with the Notice of Meeting and Explanatory Memorandum for AEA to be sent to all Shareholders to assist them in deciding whether to accept or reject the Proposal.

$\overline{2}$ . SUMMARY AND OPINION

We have considered the terms of the Proposal as outlined in the body of this report and have concluded that the Proposal is fair and reasonable to Shareholders.

$2.1$ Fairness

In Section 9 we determined that the proposed consideration exceeds the value of the shares in SCB that AEA proposes to sell to CXL, as detailed below.

	Low \$	High
Value of AEA's interest in SCB (Section 8)	75.462	100.615
Value of the proposed cash consideration '	144.635	144.635

Note ¹: The actual value of the consideration will be based on the last reported Net Tangible Asset ("NTA") value of SCB prior to the transaction. For the purposes of this report we have used the NTA value as at 30 April 2005 to calculate the relevant amount of consideration to be given. This estimate equates to \$144,635 as expressed in the table above. The actual NTA figure to be used should the Proposal be accepted is expected to be as at 31 May 2005.

The above values indicate that the Proposal is fair for Shareholders.

$2.2\phantom{0}$ Reasonableness

We have considered the analysis in Section 11 of this report in terms of the advantages and disadvantages of the Proposal.

In our opinion, the position of Shareholders if the Proposal proceeds is more advantageous than the position if the Proposal does not proceed. Accordingly, we believe that the Proposal is reasonable for Shareholders. The respective advantages and disadvantages considered are summarised below:

ADVANTAGES AND DISADVANTAGES
Section	Advantages	Section	Disadvantages
11.1.1	The proposal is fair	11.2.1	Potential loss of distribution of future
11.1.2	Greater Liquidity of Assets		profits
11.1.3	Increase in cash balance
11.1.4	Ability to undertake the return of capital
11.1.5	Ability to dispose of investments at greater than Market value.
11.1.6	Use of company shell

3. DETAILS OF THE PROPOSAL

$3.1$ The Proposal

It is proposed that AEA sells the 698,718 shares it holds in SCB to CXL for cash consideration, the amount to be based on the last reported NTA (post tax) of SCB prior to the transaction. The management of AEA have arrived at an estimate of this figure of \$144,635 which is based upon the NTA backing of SCB as at 30 April 2005, which we have used for the purposes of this report. It is expected the exact amount of consideration given, should the Proposal be approved, will be based on the NTA figure for SCB at 31 May 2005.

The terms of the return of capital are that an in specie distribution of share assets held by AEA being made to all shareholders equally. The share assets are:

(a) its current holding of $36,258,535$ shares (81.23%) in Sofcom Limited (" $SOF$ ").
(b) a shareholding in CXL which is proposed to be received by AEA via an in specie distribution of the same by SOF, expected to be approximately 1,416,159 CXL shares. This in turn is dependant on approval for the relevant enabling transactions being received from the non associated shareholders of Bentley International Limited ("BEL") and SOF.

We are not required to express an opinion on the proposed return of capital and have not done so.

BASIS OF EVALUATION 4.

$4.1$ Regulatory Guidelines

In determining whether the Proposal is fair and reasonable, we have had regard to the views expressed by the ASIC in their Policy Statements 74 and 75. These Policy Statements suggest that an opinion as to whether transactions are fair and reasonable should entail consideration of all the circumstances of the Proposal.

Such consideration includes a comparison of the likely advantages and disadvantages for Shareholders if the Proposal is accepted, with the advantages and disadvantages to those Shareholders if it is not.

4.2 Adopted Basis of Evaluation

Having regard to both Policy Statements above, BDO has completed this comparison in two parts:

A comparison between the value of the shares in SCB that AEA Proposes to sell to CXL and the value of the consideration offered by CXL (fairness - see Section 9 "Is the Transaction Fair?"): and
An investigation into other significant factors to which Shareholders might give consideration, prior to approving the resolution, after reference to the value derived above (reasonableness - see Section 11 "Is the Transaction Reasonable?").

The Proposal could be considered "reasonable" if there are valid reasons to approve the Transaction, notwithstanding that it may not be regarded as "fair" to Shareholders.

5. BACKGROUND OF ALTERA CAPITAL LIMITED

5.1 History & Background

The principal course of business of AEA is project management/development and IT consulting and management of cash reserves and share investments. AEA has been listed on the Australian Stock Exchange ("ASX") since 17 April 2000.

The Company has been loss making. Sales revenue has been low and cash reserves are becoming depleted. The Company has incurred significant losses.

The Board has stated that they believe that a listed company requires a critical mass of capital of at least \$15 million to provide an income stream and capital growth for its shareholders. The Board believes that this can be achieved by aggregating AEA with a number of other suitable listed companies into a single listed entity. Further details of the "Aggregation" strategy can be found in the Directors' Report forming part of the Company's 31 December 2004 Half Yearly Report.

The aggregation strategy has been an ongoing goal for the directors of AEA; however a hurdle appeared when large legal costs were incurred during the current 2004/2005 financial year as a result of various matters arising from investment by the Company in SCB. The ensuing legal issue slowed the aggregation process, meaning that only now has it been able to be initiated.

AEA Consolidated	Half Year ended 31 December 2004 Ś	Year ended 30 June 2004 s	Year ended 30 June 2003 s
Sales Revenue	65,446	149,238	93,673
Cost of sales	(65, 446)	(149, 238)	(75, 614)
Gross Profit			18,059
Other Revenue from Operating Activities	402.731	1,316,950	5,125,963
Non Operating Revenue		300,000	62,215
Occupancy Expenses	(27, 877)	(74, 895)	(62, 639)
Finance Expenses	(1,117)	(3.939)	(1, 558)
Borrowing expenses	(121)	(447)	(328)
Cost of shares sold	(269, 723)	(1, 156, 829)	(4,573,301)
Administration expenses	(51,268)	(152,319)	(187,621)
Corporate Expenses
- Takeover defence costs and related matters			26,491
- Share Investment related costs	(41,789)	17.576	(176, 325)
- Professional fees	(946, 890)	(195,836)	(357,561)
- Provision for doubtful debt			(12,645)
- Depreciation	(1.956)	(25, 100)	(33,090)
- Fixed assets write down	(71)	(16, 795)
- Fixed assets disposal			(140)
- Personnel	(186, 110)	(432,929)	(282, 541)
- Other Provisions - employee benefits	(10,213)	(53, 169)	(20, 952)
- Other Corporate Expenses	(42, 220)	2,594
- (Writeback)/ diminution in value of share investments	191.139	(860, 367)	18,152
- (Writeback)/ diminution in value of associate			${317,453}$
- Other corporate expenses		93,165	(67, 407)
Share of Associates net losses			(330, 034)
Profit/ (loss) from ordinary activities before income tax expense	(985, 485)	(1,428,700)	(1,169,715)
Income tax benefit/ (expense)
Net profit/ (loss) from ordinary activities after related income tax expense	(985, 485)	(1,428,700)	(1,169,715)

5.2 Historical Statements of Financial Performance

Source: Annual reports for the years ended 30 June 2003 and 2004 and Half Year Report for 31 December 2004

We note the following in relation to AEA's recent financial performance:

All payments to directors are contained within the account administration expenses.
Sales Revenue relates to consultancy fees charged to Fast Scout Limited in its development of software and to Queste Communications Limited for computer network maintenance.
Other Revenue from Operating activities relates to interest income and gross proceeds from the sale of shares held as investments.
Administration Expenses consist primarily of consultancy fees and communications expenses.
Large expenses relating to professional fees which are primarily made up of third party consulting and legal fees.

Historical Statements of Financial Performance $5.3$

AEA Company only	Year ended 30 June 2004	Year ended 30 June 2003
Sales Revenue	149.238	93,673
Cost of sales	(149, 238)	(75, 614)
Gross Profit		18,059
Other Revenue from Operating Activities	198.692	5,125,963
Non Operating Revenue		62,215
Occupancy Expenses	(49.033)	(62, 639)
Finance Expenses	(2.291)	(1,558)
Borrowing expenses		(328)
Cost of shares sold	(168.970)	(4, 573, 301)
Corporate Expenses	(363, 872)	(924, 170)
- Diminution in value of share investments	(692.645)	18,152
- Diminution in value of Associate		(317, 453)
Administration expenses	(79.535)	(187,621)
Share of Associates net losses		(330,034)
Profit/ (loss) from ordinary activities before income tax expense	(1, 157, 654)	(1, 169, 715)
Income tax benefit/ (expense)
Net profit/ (loss) from ordinary activities after related income tax expense	(1, 157, 654)	(1, 169, 715)

Source: Annual reports for the years ended 30 June 2003 and 2004

5.4 Historical Statements of Financial Position

AEA Consolidated	As at 31 December 2004 Ś	As at 30 lune 2004 Ś
CURRENT ASSETS
Cash assets	10.669	604,350
Receivables	121.055	64,308
TOTAL CURRENT ASSETS	131,724	668,658
NON-CURRENT ASSETS
Plant and equipment	3.312	357
Other Financial Investments	2,365,072	2,397,131
TOTAL NON-CURRENT ASSETS	2,368,384	2,402,471
TOTAL ASSETS	2,500,108	3,071,129
CURRENT LIABILITIES
Payables	882.904	479.675
Provisions	48.099	37,886
TOTAL CURRENT LIABILITIES	931,003	517,561
TOTAL LIABILITIES	931,003	517,561
NET ASSETS	1,569,105	2,553,568
EQUITY
Contributed equity	8.038.761	8,038,761
Retained Profits/ (Accumulated losses)	(6,980,972)	(6,123,611)
Parent Entity Interest	1.057,789	1,915,150
Outside Equity Interest	511,316	638,418
TOTAL EQUITY	1,569,105	2,553,418
Appendiction of for the user ended 20 June 2004 and USB Vess Benevi for 21 December 2004 $C$ aunan

Source:

Annual report for the year ended 30 June 2004 and Half Year Report for 31 December 2004

5.5 Capital Structure

$5.5.1$ The capital structure of AEA as at 12 May 2005 was as follows:

Ordinary Shares	12 May 2005
Total Ordinary Shares on Issue	62.018.213
- Top Twenty Shareholders – Ordinary Shares	48.570.868
Top Twenty Shareholders - % of Ordinary Shares on Issue.	78.3%

Source: Advanced Share Registry Services Report as at 12 May
2005

Range of Shares Held	No. of Shareholders
$1 - 1,000$	12
1,001-5,000	139
5,001-10,000	161
10,001-100,000	238
100.001 – and over	46
TOTAL	596

$5.5.2$ The spread of AEA shareholders as at 12 May 2005 was as follows:

Source: Advanced Share Registry Services Report as at 12 May 2005

$5.5.3$ The number of shares held by the most significant shareholders at 12 May 2005 is detailed below:

Shareholder	Ordinary Shares	% Shares Held
East Scout Limited	20,002.860	32.25%
Oueste Communications Limited	10.699.428	17.25%
Paddleboards Pty Ltd	4,623.687	7.46%
Mr L.F. Atkins	3,142.196	5.07%

Source: Advanced Share Registry Services Report as at 12 May 2005

6. BACKGROUND OF SCARBOROUGH EQUITIES LIMITED

$6.1$ History & Background

On 5 August 1994 SCB was listed on the ASX. On 29 April 2005 SCB (formerly Rivkin Financial Services) announced the sale of its wholly owned subsidiary Avcol Stockbroking Pty Ltd to IWL Broking Solutions Limited ("IWL") in consideration for \$10.4million (\$7.7 million cash and the buy-back and cancellation of 12,539,314 shares in SCB by IWL.) Prior to that, SCB's main activity was the provision of non advisory stockbroking services through Avcol Stockbroking Pty Limited and share investments.

Now however, the principal course of business of SCB is the management of funds for investment. SCB is a listed investment company, whose shares are traded on the ASX.

On 9 December 2004, the Company appointed FSP Equities Management Limited ("FSP") as Investment Manager to manage the Company's investment funds for an initial term of two years. FSP holds an Australian Financial Services Licence to manage its FSP Equity Leaders' Fund (FSP Fund) - a wholesale fund not open to retail investors. The Company has invested \$13.64 million with FSP to date - \$6.0 million in December 2004 and \$7.64 million in April 2005.

SCB Consolidated	Half Year ended 31 December 2004 \$'000	Year ended 30 June 2004 \$'000	Year ended 30 June 2003 \$'000
Gross revenue from ordinary activities	13.423	41.173	134,453
Cost of disposal of assets	9.268	(27.950)	(126, 474)
Net Revenue from ordinary activities	4,155	13.223	7.979
Expenses:
Employee Benefits	(1.452)	(3.011)	(2.618)
Depreciation and Amortisation	(90)	(171)	(129)
Amortisation of Goodwill	(50).	(101)	(101)
Unrealised losses on investments	(95)	(1, 172)	(876)
Selling Expenses		(1, 445)	(1,311)
Administration and other Expenses	(3.190)	(2.363)	(1,615)
Borrowing costs		${ }$
Total Expenses	(4, 877)	(8, 264)	(6, 650)
Profit/(loss) from ordinary activities before income tax expense	(722)	4.959	1,329
Income tax benefit/ (expense)	(192)	(1,064)
Net profit/(loss) from ordinary activities after related income tax expense	(914)	3,895	1.329

6.2 Historical Statements of Financial Performance

Source: Annual reports for the years ended 30 June 2003 and 2004 and Half Year Report for 31 December 2004

SCB Consolidated	As at 31 December 2004 \$'000	As at 30 June 2004 \$'000
CURRENT ASSETS
Cash assets	6,126	10,853
Receivables	7.268	15,483
Investments	4.445	8,204
Other	1,189	195
TOTAL CURRENT ASSETS	19,028	34,753
NON-CURRENT ASSETS
Plant and equipment	369	357
Investments	6,007
Intangibles	1.682	1,732
TOTAL NON-CURRENT ASSETS	8.058	2,089
TOTAL ASSETS	27,086	36,824
CURRENT LIABILITIES
Payables	7.798	16.142
Tax Liabilities	725	615
Provisions	175	2,600
TOTAL CURRENT LIABILITIES	8.698	19,357
TOTAL LIABILITIES	8,698	19,357
NET ASSETS	18,388	17,467
EQUITY
Parent entity interest: Contributed equity	22.127	20,292

Retained Profits/ (Accumulated losses)	(3,739)	(2,825)
TOTAL EQUITY	18,388	17,467

6.3 Historical Statements of Financial Position

Source:

Annual report for the year ended 30 June 2004 and Half Year Report for 31 December 2004

$7.$ VALUATION METHODOLOGIES

$7.1$ Methodologies commonly used for valuing assets and businesses are as follows:

$7.1.1$ Capitalisation of future maintainable earnings ("FME")

This method places a value on the business by estimating the likely FME, capitalised at an appropriate rate which reflects business outlook, business risk, investor expectations, future growth prospects and other entity specific factors. This approach relies on the availability and analysis of comparable market data.

The FME approach is the most commonly applied valuation technique and is particularly applicable to profitable businesses with relatively steady growth histories and forecast, regular capital expenditure requirements and non-finite lives.

The FME used in the valuation can be based on net profit after tax or alternatives to this such as earnings before interest and tax ("EBIT") or earnings before interest, tax, depreciation and amortisation ("EBITDA"). The capitalisation rate or "earnings multiple" is adjusted to reflect which base is being used for FME.

$7.1.2$ Discounted future cash flows ("DCF")

The DCF methodology is based on the generally accepted theory that the value of an asset or business depends on its future net cash flows, discounted to their present value at an appropriate discount rate (often called the weighted average cost of capital). This discount rate represents an opportunity cost of capital reflecting the expected rate of return which investors can obtain from investments having equivalent risks.

A terminal value for the asset or business is calculated at the end of the future cash flow period and this is also discounted to its present value using the appropriate discount rate.

DCF valuations are particularly applicable to businesses with limited lives, experiencing growth, that are in a start up phase, or experience irregular cash flows.

$7.1.3$ Net asset value

Asset based methods estimate the market value of an entity's securities based on the realisable value of its identifiable net assets. Asset based methods include:

Orderly realisation of assets method
Liquidation of assets method
Net assets on a going concern method $\bullet$

The orderly realisation of assets method estimates fair market value by determining the amount that would be distributed to entity holders, after payment of all liabilities including realisation costs and taxation charges that arise, assuming the entity is wound up in an orderly manner.

The liquidation method is similar to the orderly realisation of assets method except the liquidation method assumes the assets are sold in a shorter time frame. Since wind up or liquidation of the entity may not be contemplated, these methods in their strictest form may not be appropriate. The net assets on a going concern

method estimates the market values of the net assets of an entity but does not take into account any realisation costs.

Net assets on a going concern basis is usually appropriate where the majority of assets consist of cash, passive investments or projects with a limited life. All assets and liabilities of the entity are valued at market value under this alternative and this combined market value forms the basis for the entity's valuation.

These asset based methods ignore the possibility that the entity's value could exceed the realisable value of its assets as they do not recognise the value of intangible assets such as management, intellectual property and goodwill. Asset based methods are appropriate when entities are not profitable, a significant proportion of the entity's assets are liquid or for asset holding companies.

$7.1.4$ Quoted Market Price Basis

Another alternative valuation approach that can be used in conjunction with (or as a replacement for) any of the above methods is the quoted market price of listed securities. Where there is a ready market for securities such as the ASX, through which shares are traded, recent prices at which shares are bought and sold can be taken as the market value per share. Such market value includes all factors and influences that impact upon the ASX. The use of ASX pricing is more relevant where a security displays regular high volume trading, creating a "deep" market in that security.

7.2 Valuation methods adopted to value SCB

AEA's investment in SCB represents approximately 0.7% of the issued shares of SCB. We consider the method most appropriate in valuing AEA's shares in SCB to be the Quoted Market Price Basis valuation approach. This is primarily due to the fact that SCB is a relatively liquid stock, thus its value is fairly indicated by the supply and demand influences cast upon it by the share market.

8. VALUATION OF SCB

Quoted Market Prices for SCB Securities 8.1

We have assessed the value of SCB based on the market prices for an SCB share $8.1.1$ below:

The following chart provides a summary of the share price movement over the year between 13 May 2004 and 12 May 2005. There have been no company announcements relating to this transaction that would affect the share price of SCB to date. As such we have assessed the share value for the year to 12 May 2005.

Source: ASX

The daily price of SCB shares from 13 May 2004 to 12 May 2005 has ranged from a high of 30.0 cents on 23 November 2004 to a low of 12.0 cents on 11 May 2005. The stock experienced a peak in traded volume around the months between September and November 2004. During this period a number of competing investors acquired strategic holdings in SCB resulting in high trading volumes.

It is significant to note the steady decline in the weighted average share price through the year. This suggests that, other factors removed, the shares may continue to decline in value in the future.

$8.1.2$ To provide further analysis of the market prices for SCB shares, we have considered the information at 8.1.1 above and calculated the weighted average market price for 10 day, 30 day, 60 day, and 90 day periods to 13 May 2005.

SCB per share	13 May 2005 ¢	10 Days ¢	30 Days ¢	60 Days ¢	90 Days
Closing Price	14.5
Weighted Average		12.6	137	15.8	17.5
Course, ACV

Source: ASX

Pre announcement period	Share price (low) ¢	Share price (high) ¢	Cumulative volume traded	As a % of issued capital
t day	12.0	13.0	103,300	0.10%
I week	12.0	14.0	671,350	0.67%
I month	12.0	16.0	1.555.929	1.55%
3 months	12.0	22.5	6.107.891	6.09%
6 months	12.0	30.0	29.858.356	29.77%
12 months $P_{\text{minmax}}$ $\land$ $\cap$ $\lor$	12.0	30.0	67,248,091	67.04%

8.1.3 An analysis of the volume of trading in SCB shares prior to 13 May 2005 is set out below:

Source: ASX

8.2 Assessment of SCB Value

Based on the analysis in section 8.1, we have assessed the value of a SCB share, based on market prices, to be in the range of 12.0 cents to 16.0 cents. The average daily trading volume over the last 90 trading days was approximately 90,400 shares. AEA holds 698,718 SCB shares representing approximately 8 days trading volume. As such we consider it appropriate to discount the market price by 10% to reflect the ability of AEA to sell its shares in an orderly manner. The result of the valuation performed is summarised in the table below:

Valuation	Value per SCB share cents
	Low	High
ASX market prices	10.8	14.4

Accordingly we have valued AEA's interest in SCB at 10.8 cents to 14.4 cents per share.

Assessment of AEA's share of SCB 8.3

As AEA controls 698.718 shares in SCB and we have assessed the value of an SCB share to be between 10.8¢ and 14.4¢ per share, the value of the shares proposed to be transferred is between \$75,462 and \$100,615.

9. IS THE PROPOSAL FAIR?

The consideration to be paid to CXL is \$144,635, based upon the 30 April 2005 NTA of SCB. As discussed in section 3.1, the actual amount of the consideration will be determined based upon the latest reported NTA figures for SCB. In section 8.3 we have assessed the value of the shares being transferred. The following table summarises our assessment of the value of shares being transferred against the consideration being offered by CXL.

	Ref	Low s	High s
Value of AEA's interest in SCB	83	75.462	100.615
Value of proposed cash consideration	2 I	144.635	144,635

As such in our opinion the Proposal is fair to Shareholders.

10. OTHER CONSIDERATIONS

10.1 Alternative Proposal

We are unaware of any alternative proposal that might offer the non-associated shareholders of AEA a premium over the value ascribed to that resulting from the Proposal.

10.2 Premium For Control

ASIC Policy Statement 74 requires that the expert give an opinion as to whether the proposed transaction will result premium for control being paid. We have estimated the amount of any premium for control being paid by CXL as the amount by which the value of the settlement consideration exceeds the value of the shares being acquired.

We have assessed that the value of the shares being sold to be between \$75,462 and \$100,615 and value of the settlement consideration to be \$144,635. Accordingly, the premium for control that is being paid by CXL is between \$44,020 and \$69,173.

11. IS THE PROPOSAL REASONABLE?

We have considered the position of the Shareholders if the Proposal is accepted and have taken into account the following advantages and disadvantages in this assessment.

We have assessed that in all cases the advantages and disadvantages of rejecting the Proposal are the inverse of accepting the Proposal. Thus for simplicity and ease of evaluation of the Proposal, we have set out the significant factors only in the context of accepting the Proposal.

11.1 Advantages of Accepting the Proposal

$11.1.1$ The Proposal is fair

As shown in Section 9 we have assessed the Proposal to be fair to Shareholders. ASIC Policy Statement 75 states that "an offer is reasonable if it is fair".

$11.1.2$ Greater Liquidity of Assets

If the Proposal is approved the settlement consideration will mean that the majority of AEA's assets will be in the form of cash. This will provide AEA with

greater liquidity of assets meaning that there will be an increased ability to repay its liabilities as and when they fall due.

$11.1.3$ Increase in asset value

By selling the shares in SCB for the nominated consideration, AEA will increase the value of their Net Assets by the amount specified in section 10.2, which is the premium for control.

$11.1.4$ Ability to undertake the return of capital

After the disposal of the shares, AEA will be able to fully effect the return of capital as proposed in Resolution 1 of the Notice of Meeting. The full extent of the return of capital will be effected by the in specie distribution of share assets held by AEA.

$11.1.5$ Ability to dispose of investments at greater than market value

AEA's share of legal expenses relating to the recent litigation regarding its investment in SCB is currently approximately \$275,000. AEA has the intention of selling off shares in SCB in order to pay for legal fees and other expenses. The Proposal enables AEA to do so in excess of the market price, which will result in significant cost savings. If AEA was to do so at current market prices, it is likely that the value that would be received would be below the current market price given the size of the parcel.

$11.1.6$ Ability to utilise company shell

If the proposal is accepted and the return of capital completed, then AEA will become a company shell, which has an intrinsic value for resale. This could result in future value for shareholders.

11.2 Disadvantages of Accepting the Proposal

11.2.1 Potential Loss of distribution of future profits

By selling their interest in SCB, AEA is losing the ability to receive a distribution of whatever profits that SCB may make in the future. It is difficult to predict or quantify the levels of these profits.

12. CONCLUSION

We have considered the terms of the Proposal as outlined in the body of this report and have concluded that the Proposal is fair and reasonable to Shareholders.

13. SOURCES OF INFORMATION

This report has been based on the following information:

Draft Notice of General Meeting and Explanatory Statement on or about the date of this report:
AEA's Annual Reports for the years ended 30 June 2004 and 30 June 2003;
SCB's Annual Reports for the years ended 30 June 2004 and 30 June 2003;
SCB's Half Year Report to 31 December 2004; ۰
AEA's Half Year Report to 31 December 2004;
ASX announcements and share price data for AEA and SCB;
Discussions with Directors and Management of AEA; and
Information available in the public domain, such as Bloomberg, brokers' reports, comparable companies' annual reports and announcements.

14. INDEPENDENCE

BDO Consultants (WA) Pty Ltd is entitled to receive a fee of \$6,000 for the preparation of this report. Except for this fee, BDO Consultants (WA) Pty Ltd has not received and will not receive any pecuniary or other benefit whether direct or indirect in connection with the preparation of this report.

Prior to accepting this engagement BDO Consultants (WA) Pty Ltd considered its independence with respect to AEA and any of their respective associates with reference to the ASIC Practice Note 42 entitled "Independence of Expert's Reports". In our opinion BDO Consultants (WA) Pty Ltd is independent of AEA and their associates.

Neither the two signatories to this report nor BDO Consultants (WA) Pty Ltd have had within the past two years any professional relationship with AEA, or their associates, other than in connection with the preparation of this report.

A draft of this report was provided to AEA and its advisers for confirmation of the factual accuracy of its contents. No significant changes were made to this report as a result of this review.

In addition, BDO Consultants (WA) Pty Ltd has been indemnified by AEA in respect of any claim arising from BDO Consultants (WA) Pty Ltd's reliance on information provided by the AEA, including the non provision of material information, in relation to the preparation of this report.

15. QUALIFICATIONS

BDO Consultants (WA) Pty Ltd is wholly owned by BDO, a member of BDO International, which has extensive experience in the provision of corporate finance advice, particularly in respect of takeovers, mergers and acquisitions.

BDO Consultants (WA) Pty Ltd holds an Australian Financial Services Licence issued by the Australian Securities and Investment Commission for giving expert reports pursuant to the Listing rules of the ASX and the Corporations Act.

The persons specifically involved in preparing and reviewing this report were Sherif Andrawes, Matt Giles and Steve Kite of BDO Consultants (WA) Pty Ltd. They have significant experience in the preparation of independent expert reports and valuations.

16. DISCLAIMERS AND CONSENTS

This report has been prepared at the request of AEA for inclusion in the Explanatory Memorandum which will be sent to all AEA Shareholders. AEA engaged BDO Consultants (WA) Pty Ltd to prepare an independent expert's report to consider the sale of shares to CXL under the Proposal.

BDO Consultants (WA) Pty Ltd hereby consents to this report accompanying the above Explanatory Memorandum. Apart from such use, neither the whole nor any part of this report, nor any reference thereto may be included in or with, or attached to any document, circular resolution, statement or letter without the prior written consent of BDO Consultants (WA) Pty Ltd.

BDO Consultants (WA) Pty Ltd takes no responsibility for the contents of the Explanatory Memorandum other than this report.

BDO Consultants (WA) Pty Ltd has not independently verified the information and explanations supplied to us, nor has it conducted anything in the nature of an audit of AEA or SCB. However, we have no reason to believe that any of the information or explanations so supplied are false or that material information has been withheld.

The statements and opinions included in this report are given in good faith and in the belief that they are not false, misleading or incomplete.

The terms of this engagement are such that BDO Consultants (WA) Pty Ltd has no obligation to update this report for events occurring subsequent to the date of this report.

Yours faithfully BDO CONSULTANTS (WA) PTY LTD

$\int_{\mathbb{R}}\int_{\mathbb{R}}\int_{\mathbb{R}}\sqrt{dt}dt$

Sherif Andrawes Director

Matt Giles Director

Appendix 1 - Glossary of Terms

Reference	Definition
The Act	The Corporations Act
AEA	Altera Capital Limited
ASIC	Australian Securities and Investments Commission
ASX.	Australian Stock Exchange
AUD	Australian Dollar
BEL	Bentley International Limited
BDO	BDO Consultants (WA) Pty Ltd
The Company	Altera Capital Limited
CXL	Central Exchange Limited
DCF.	Discounted Future Cash Flows
EBIT	Earnings before interest and tax
EBITDA	Earnings before interest, tax, depreciation and amortisation
FSP	FSP Equities Management Limited
FMD	Future Maintainable Dividends
FME	Future Maintainable Earnings
IWL.	IWL Broking Solutions Limited
NTA	Net Tangible Assets
The Proposal	The Proposal to sell 698,718 ordinary shares in SCB
Our Report	This Independent Expert's Report prepared by BDO
SCB	Scarborough Equities Limited
Shareholders	Shareholders of AEA not associated with CXL
SOF	Sofcom Limited
USD	United States Dollar

Altera Capital Limited A.B.N 55 082 541 437

HALF YEAR REPORTS:

ASX Appendix 4D - Results For Announcement To Market Directors' Report Financial Statements Audit Review Report Auditor's Independence Declaration

31 December 2004

www.alteracapital.com

ALTERA CAPITAL LIMITED (formerly Bigshop.com.au Limited) A.B.N. 55 082 541 437

Level 14, 221 St Georges Terrace, Perth WA 6000

$T$ [ + 61 (8) 9214 9787

$F$ | + 61 (8) 9322 1515

E | [email protected]

ASX Appendix 4D - Results for Announcement to the Market	2
Directors' Report	3
Statement of Financial Performance	9.
Statement of Financial Position	10
Statement of Cash Flows	11
Notes to Financial Statements	12
Directors' Declaration	19
Audit Review Report	20
Auditor's Independence Declaration	23

www.alteracapital.com

Visit our website for:

Latest News
Market Announcements
Financial Reports $\overline{a}$

EMAIL US AT:

[email protected]

CORPORATE DIRECTORY

BOARD Farooq Khan Chairman and Managing Director Victor P H Ho Director Simon K Cato Director COMPANY SECRETARY Victor P H Ho REGISTERED & PRINCIPAL OFFICE Level 14, The Forrest Centre 221 St Georges Terrace Perth Western Australia 6000 (08) 9214 9787 Telephone: (08) 9322 1515 Facsimile: Email: [email protected] SHARE REGISTRY Advanced Share Registry Services Level 7, 200 Adelaide Terrace Perth Western Australia 6000 Telephone: (08) 9221 7288 Facsimile: $(08)$ 9221 7869 STOCK EXCHANGE Australian Stock Exchange Perth, Western Australia ASX CODE AEA AUDITORS Stanton Partners 1 Havelock Street West Perth Western Australia 6005 BANKERS National Australia Bank Level 1, 50 St Georges Terrace Perth Western Australia 6000

RESULTS FOR ANNOUNCEMENT TO MARKET

This Half Year Report is provided to the Australian Stock Exchange (ASX) under ASX Listing Rule $4.2A.3$

Current Reporting Period:	1 July 2004 to 31 December 2004
Previous Corresponding Period:	1 July 2003 to 31 December 2003
Balance Date:	31 December 2004

RESULTS FOR ANNOUNCEMENT TO THE MARKET

Revenue and Net Profit (Loss)

Company			Dec 2004 \$	Dec 2003 \$
Revenue from ordinary activities	Down	11%	107,435	121,054
Loss from ordinary activities after tax attributable to members	Down	25%	(447, 603)	(597,735)
Loss for the period attributable to members	Down	25%	(447, 603)	(597,735)

Consolidated Entity			Dec 2004 \$	Dec 2003 \$
Revenue from ordinary activities	Down	8%	468,177	509,730
Loss from ordinary activities after tax attributable to members	Up	510%	(985, 485)	(161, 478)

Dividends

No dividends have been paid or declared during the financial half year.

Brief Explanation of Revenue, Net Profit and Dividends (above)

The consolidated financial statements incorporates the financial position and performance of the Company's controlled entity, ASX listed Sofcom Ltd ("Sofcom").

At the Company level:

Revenues from ordinary activities includes \$30,029 gross proceeds from the sale of investments $(1)$ $(2003: $14,013)$ .
$(2)$ Expenses from ordinary activities includes:
\$125,041 diminution of investments (2003: \$338,044); $(a)$
\$43,413 cost of investments sold (2003: \$33,030); $(b)$
\$142,232 professional fees (December 2003: \$52,780) this comprise principally the $(c)$ Company's share of legal fees relating to litigation involving Rivkin Financial Services Limited.

RESULTS FOR ANNOUNCEMENT TO MARKET

The diminution of investments of \$125,041 includes \$144,563 provision for additional diminution $(3)$ in the value of an investment in Sofcom for the current reporting period as Sofcom's closing ASX price on 31 December 2004 was 4.4 cents per share (2003: 5.7 cents). The Company also notes that Sofcom's net tangible asset ("NTA") backing per share as at Balance Date was 6.1 cents per share (2003: 5.2 cents).

Please also refer to the financial statements for the half year ended 31 December 2004 and notes thereto for further information.

For and on behalf of the Directors,

Victor Ho Company Secretary

Date: 24 February 2005

The Directors present their report on Altera Capital Limited ABN 55 082 541 437 (formerly Bigshop.com.au Limited) ("Company" or "Altera Capital" or "AEA") and its controlled entities (the "Consolidated Entity") for the financial half year ended 31 December ("Balance Date").

Altera Capital has prepared a consolidated financial report incorporating the entities that it controlled during the financial half year. The only controlled entity was ASX listed Sofcom Ltd (formerly Software Communication Group Limited) ("Sofcom" or "SOF") (controlled throughout the financial year). Altera Capital holds 36,258,535 shares or 81.23% of the total issued capital of SOF.

Altera Capital is a company limited by shares that is incorporated and domiciled in Western Australia and is listed on the Australian Stock Exchange ("ASX"). The Company has been suspended from quotation on ASX since 13 June 2003.

OPERATING RESULTS

	Consolidated Entity		Company
	Dec 2004	Dec 2003 S	Dec 2004	Dec 2003
Net loss	(985, 485)	(161, 478)	(447, 603)	(597,735)
Net loss after minority interest	(857, 361)	(176.409)	(447, 603)	(597,735)

LOSSES PER SHARE

	Consolidated Entity		Company
	Dec 2004	Dec 2003	Dec 2004	Dec 2003
Basic loss per share (cents)	(1.38)	(0.24)	(0.72)	(0.81)
Diluted loss per share (cents)	(1.38)	(0.24)	(0.72)	(0.81)
Weighted average number of fully paid ordinary shares in the Company outstanding during the period used in the calculation of diluted loss per share	62,018,213	73,493,623	62.018.213	73.493.623

NET TANGIBLE ASSET BACKING

	Consolidated Entity		Company
	Dec 2004	Dec 2003	Dec 2004	Dec 2003
Net tangible assets	\$1,569,105	\$3,845,553	\$1,552,694	\$2,560,216
Fully paid ordinary shares on issue at Balance Date	62.018,213	62.018.213	62.018.213	62.018.213
Net tangible asset backing per issued ordinary share as at Balance Date (cents)	2.53	6.20	2.50	4.13

Notes to Company Level NTA:

$(i)$ At Balance Date, the Company held 36,258,535 (81.23%) shares in SOF which has been valued at SOF's ASX closing price of 4.4 cents per share.
However, SOF's NTA backing was 6.1 cents per share at Balance Date. Based on such $(ii)$ valuation of the Company's investment in SOF, the NTA backing of the Company would increase to 3.50 cents per share.
$(iii)$ At Balance Date, SOF's major asset was 6,924,734 (17.78%) shares in ASX listed Bentley International Limited ("BEL"), which Sofcom has carried at BEL's closing ASX price of 38 cents per share as opposed to BEL's NTA backing per share of 44.28 cents per share. Based upon BEL's NTA valuation, SOF's NTA would increase to 7.79 cents per share at Balance Date.
$(iv)$ Based on such valuation of the Company's investment in SOF, the NTA backing of the Company would increase to 4.5 cents per share.

SECURITIES IN THE COMPANY

The current number of the Company's fully paid ordinary shares on issue is 62,018,213.

The Company also has the following unlisted options on issue at the date of this report:

Nature of Unlisted Options on issue	Number	Exercise Price	Expiry Date
"Promoter" Options	18,000.000	70 cents.	30 June 2005
"Incentive" Options	1.090.000	25 cents	13 April 2005
"15 May 2007" Options	2.500,000	7.50 cents	15 May 2007

There were no securities issued or granted by the Company during or since the financial half year.

REVIEW OF OPERATIONS

ASX SUSPENSION $\mathbf{L}$

At the request of the ASX and pursuant to the ASX Listing Rules, the Company has been suspended from quotation on ASX from 13 June 2003, on the eve of the Company's general meeting approving the making of a proportionate takeover bid for Sofcom and a rights issue.

ASX has advised that prior to reinstatement to ASX, the Company will be required to re-comply with the ASX Listing Rules. This includes seeking shareholder approval in relation to its activities and meeting the requirements of the Listing Rules as if it were applying for admission to the Official List of ASX as a new company. This includes undertaking a capital consolidation to ensure a sale price of at least \$0.20 for the Company's shares, lodgement of a full form prospectus (if applicable) and satisfaction of the minimum shareholder spread requirements.

During the financial half year, the Company has pursued:

The identification, review and assessment of a number of wide ranging opportunities such that $(i)$ the proposed investment transaction path will facilitate the Company's re-admission to the ASX; and
$(ii)$ an appropriate "aggregation" strategy (see below under "Aggregation" Strategy) between the Company and other listed public companies such that shareholders receive shares in another ASX listed company (or company to be listed on ASX) with an aggregate value equal to the net tangible assets ("NTA") of the Company at that time. Such "aggregation" provides an opportunity for shareholders to effectively realise the NTA value of their investment in the Company through a parallel investment in another vehicle whilst retaining their shareholding in Company, which will continue to pursue endeavours in (i) above.

However, in July 2004, legal proceedings were initiated against AEA by Rivkin Financial Services Limited (please refer to in Note 17 of the attached Notes to the Financial Statements) and pending resolution of this matter, the Company is not able to practicably advance its Aggregation Strategy.

$\overline{2}$ . "AGGREGATION" STRATEGY

The Board believes that a listed company requires a critical mass of capital sufficient to secure commercial opportunities and accordingly provide both an income stream and capital growth for its shareholders. The Board believes that a prudent capital base from which a listed company is able to secure such commercial objectives is at least \$15 million.

This "aggregation" process may be realised (subject to acceptable taxation advice and compliance with the Corporations Act and the ASX Listing Rules) through a number of avenues including participating companies subscribing in an existing "lead" company or to a new "master" company or via a scheme of arrangement or merger between participating companies. Alternatively, an existing participating company may be used as the "lead" vehicle in terms of the aggregation process.

The Company (along with other participating companies) effecting a "transfer" of available net tangible assets ("NTA") to the "master" company in exchange for shares in the "master" company (priced at the "master" company's NTA backing per share);
The participating companies would effect a capital return to its shareholders via an in-specie distribution of the "master" company's shares:
Such participating companies' shareholders would then become shareholders of the "master" company but will retain their existing shareholdings in their respective companies (at reduced NTA backing per share);
The "master" company's NTA would be expanded by the contributions of the NTA of the participating companies - this is with the aim of achieving a minimum capital base of \$15m (referred to earlier);
Such contributions or transfer of NTA's by participating companies may comprise cash or liquid ۰ investments (valued in turn at NTA backing or market as is appropriate);
In relation to contributions by way of liquid investments, the "transfer" of NTA or market value may involve a share acquisition agreement between the "master" company and a relevant participating company;
Alternatively, and also in relation to contributions of cash, the "transfer" of NTA value from participating companies to the "master" company may be pursuant to a specific share placement or wider capital raising undertaken by the "master" company;
Post aggregation, the balance sheet of the "master" company would comprise its existing preaggregation assets and the NTA contributed by the participating companies, being a combination of cash and liquid investments;
In all of the above "transfer" scenarios, the "master" company would value the shares it would issue at the NTA backing of the company and likewise, each of the participating companies would value their contribution of liquid investments at NTA backing or market value as is appropriate - so as to ensure that there is no or minimal "value shift" as between the companies;
The Company's shareholders would thus have a shareholding in the "master" company in proportion to the Company's contribution (valued at NTA or appropriate market value of liquid assets) into the "master" company and retain their existing shareholding in the Company (which will have a reduced NTA backing post "aggregation").

The final proposed aggregation strategy will be subject to compliance with the Corporations Act and the ASX Listing Rules and a general meeting will be required to consider and approve such "aggregation" process and other matters arising from or incidental to such process. The Board hopes to finalise its aggregation strategy within the next 6 months (subject to resolution of the appeal and cost orders in relation to Rivkin Financial Services Limited referred to in Note 17 of the attached Notes to the Financial Statements).

Pending the announcement of an appropriate "aggregation" strategy, the Board has continued its endeavours to seek to add value to the asset base and underlying share price of the Company through the pursuit of selective investment and other commercial opportunities.

Such selective investment and commercial opportunities will be pursued with the objective(s) of creating a secure income stream for the Company and/or the acquisition of assets that provide for capital growth with the view to securing a return beyond what would be provided from investing merely in bank bills or cash deposits, pending the finalising of the "aggregation" process referred to above. Investments will be acquired either on the basis that they are currently undervalued or present the opportunity for superior capital growth.

З. CONSULTING OPERATIONS

The Company has retained project management and technical personnel and has continued to provide various software development, project management and IT consulting services during the financial year. Revenues from the provision of such services ameliorates to a significant extent the costs associated with maintaining the technical team.

DIRECTORS

The names of Directors in office during and since the financial half year are:

$\mathbf{1}$ . Farooq Khan LLB, B.Juris

Chairman and Managing Director

Mr Khan has been a Director of the Company since 26 November 2001. Mr Khan has previously practised law for a number of years, principally in the field of corporate law. Mr Khan has extensive experience in the securities industry and the promotion and executive management of ASX listed companies. Mr Khan also has considerable experience in the strategic review of public listed companies, capital raisings and corporate takeovers and restructuring. Mr Khan is also currently Chairman of ASX listed Queste Communications Limited, Fast Scout Limited, Sofcom Limited, Bentley International Limited and Rivkin Financial Services Limited.

$\overline{2}$ . Victor P H Ho B.Comm, LLB, FTIA Executive Director

Mr Ho has been a Director and Company Secretary of the Company since 26 November 2001. Prior to his involvement with the Company, Mr Ho had 9 years experience in the taxation profession with the Australian Tax Office and in a specialist tax law firm. Mr Ho is also currently in executive roles with public listed companies as Executive Director and Company Secretary of Fast Scout Limited, Central Exchange Limited and Sofcom Limited and as Company Secretary of Queste Communications Limited, Bentley International Limited and Rivkin Financial Services Limited. Mr Ho has been actively involved in the structuring and execution of a number of corporate transactions, capital raisings and capital management matters and has extensive experience in public company administration and compliance and shareholder relations.

$3.$ Simon K. Cato B.A., MSDIA Non Executive Director

Mr Cato was appointed a Director of the Company on 9 January 2004. Mr Cato has more than 20 years capital markets experience within the Australian securities industry both in investment broking and in regulatory roles. He has been employed by the Australian Stock Exchange in Sydney and Perth in the companies department (which oversees the activities of listed companies) most recently as Manager, Companies for ASX Perth. Over the last 12 years Mr Cato has been an Executive Director of two stockbroking firms and in these roles has been involved in a diverse range of management and capital investment activities. Mr Cato is currently a broker and consultant with Kirke Securities Limited and a Non-Executive Director of ASX listed Medusa Mining Limited, Sofcom Limited, Bentley International Limited and Rivkin Financial Services Limited.

AUDITOR'S INDEPENDENCE DECLARATION

The Auditor's Independence Declaration as required under section 307C of the Corporations Act 2001 is set out on page 23.

Signed for and on behalf of the Directors of Altera Capital Limited in accordance with a resolution of the Board,

Farooq Khan Chairman and Managing Director

Perth, Western Australia

24 February 2005

Simon Cato Non-Executive Director

STATEMENTS OF FINANCIAL PERFORMANCE FOR THE PERIOD ENDED 31 DECEMBER 2004

		Consolidated Entity		Company
		31 Dec 04	31 Dec 03	31 Dec 04	31 Dec 03
	Note	\$	\$	\$	\$
Sales revenue	2	65,446	69.330	65,446	69,330
Cost of sales	$\overline{2}$	(65, 446)	(69, 330)	(65, 446)	(69, 330)
Gross Profit
Other revenue from operating activities	2	402,731	440,400	41,989	51,724
Occupancy expenses	$\overline{2}$	(27, 877)	(40, 407)	(13, 390)	(28, 290)
Finance expenses	$\overline{2}$	(1, 117)	(2,831)	(580)	(1,751)
Borrowing costs	$\overline{2}$	(121)	(146)	(33)	(26)
Cost of shares sold	$\overline{2}$	(269, 723)	(33,030)	(43, 413)	(33,030)
Corporate expenses	$\overline{2}$	(1,038,110)	(466, 520)	(411, 947)	(527, 418)
Administration expenses	$\overline{2}$	(51,268)	(58, 944)	(20, 229)	(58, 944)
Share of Associate's net losses	$\mathcal{P}$
Loss from ordinary activities before income tax expense		(985, 485)	(161, 478)	(447, 603)	(597, 735)
Income tax expense relating to ordinary activities
Net Loss from ordinary activities after income tax expense		(985, 485)	(161, 478)	(447, 603)	(597, 735)
Net loss/(profit) attributable to outside equity interest		128,124	(14, 931)

Total changes in equity other than those resulting from transactions with owners as owners	11	(857, 361)	(176, 409)	(447, 603)	(597, 735)
Loss per share:

Basic loss (cents per share)	12	(1.38)	(0.24)	(0.72)	(0.81)
Weighted average number of ordinary shares outstanding during the period used in calculation of basic earnings per share	12.	62,018,213	73,493,623	62,018,213	73,493,623

The statements of financial performance should be read in conjunction with the accompanying notes.

STATEMENTS OF FINANCIAL POSITION AS AT 31 DECEMBER 2004

		Consolidated Entity		Company
	31 Dec 04	30 Jun 04	31 Dec 04	30 Jun 04
Note	\$	\$	\$	\$
CURRENT ASSETS
Cash assets 14	10,669	604,350		296.000
4 Receivables	121,055	64.308	47,957	33.912
TOTAL CURRENT ASSETS	131,724	668,658	47,957	329,912
NON CURRENT ASSETS
5 Property, plant and equipment	3,312	5,340	2,672	4,649
6 Other financial assets	2,365,072	2,397,131	1,755,587	1,924,041
TOTAL NON CURRENT ASSETS	2,368,384	2,402,471	1,758,259	1,928,690
TOTAL ASSETS	2,500,108	3,071,129	1,806,216	2,258,602
CURRENT LIABILITIES
14 Bank overdraft			8,050
7 Payables	882,904	479,675	208,121	225,147
8 Provisions	48,099	37,886	37,351	33,158
TOTAL CURRENT LIABILITIES	931.003	517,561	253,522	258,305
TOTAL LIABILITIES	931,003	517,561	253,522	258,305
NET ASSETS	1,569,105	2,553,568	1,552,694	2,000,297
EQUITY
9 Contributed equity	8,038,761	8,038,761	8,038,761	8,038,761
Accumulated losses 11	(6,980,972)	(6,123,611)	(6,486,067)	(6,038,464)
Parent entity	1,057,789	1,915,150	1,552,694	2,000,297
10 Outside equity interest	511,316	638,418
TOTAL EQUITY	1,569,105	2,553,568	1,552,694	2,000,297

The statements of financial position should be read in conjunction with the accompanying notes.

STATEMENTS OF CASH FLOWS FOR THE PERIOD ENDED 31 DECEMBER 2004

		Consolidated Entity		Company
		31 Dec 04	31 Dec 03	31 Dec 04	31 Dec 03
	Note	\$	\$	\$	\$
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers		22,779	52.553	22,779	52,553
Payments to suppliers and employees		(998, 411)	(860,700)	(369, 563)	(519,041)
Dividends received		158,775		12,028
Interest received		3,117	118,564	710	29,888
Interest paid		(33)	(146)	(33)	(26)
Contribution towards costs			300,000
NET CASH OUTFLOW FROM OPERATING
ACTIVITIES		(813,773)	(389, 729)	(334,079)	(436, 626)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of shares in listed companies		(45, 347)	(3,849,673)		(823, 451)
Proceeds from sale of shares		265,439	14,013	30,029	14,013
Purchase of plant and equipment			(3,838)		(138)
Net cash inflow from the acquisition
of Sofcom Ltd		$\overline{\phantom{a}}$	4,385,978
NET CASH INFLOW/(OUTFLOW) FROM
INVESTING ACTIVITIES		220,092	546,480	30,029	(809, 576)
CASH FLOWS FROM FINANCING ACTIVITIES
Payment for share buy back			(1,259,619)		(1,259,619)
NET CASH OUTFLOW FROM
FINANCING ACTIVITIES			(1,259,619)		(1,259,619)

NET DECREASE IN CASH ASSETS HELD		(593, 681)	(1,102,868)	(304, 050)	(2,505,821)
Add opening cash assets brought forward		604,350	2,977,525	296,000	2,977,525
CLOSING CASH ASSETS AT END OF PERIOD	14	10,669	1,874,657	(8,050)	471,704

The statements of cash flows should be read in conjunction with the accompanying notes.

$\mathbf{1}$ . BASIS OF PREPARATION

This general purpose financial report for the interim half-year reporting period ended 31 December 2004 has been prepared in accordance with Accounting Standard AASB 1029 Interim Financial Reporting, other mandatory professional reporting requirements (Urgent Issues Group Consensus Views), other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001.

This report has been prepared on a going concern basis as the Directors believe that the share investments held by the Company (valued at \$1,755,587 at Balance Date, which includes a 81.23% shareholding in ASX listed Sofcom Limited) can be liquidated in order to meet the working capital requirements of the Company in future periods.

This interim financial report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended 30 June 2004 and any public announcements made by the Company during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

The accounting policies adopted in the preparation of this Half Year Report are consistent with those adopted and disclosed in the financial statements for the year ended 30 June 2004.

Comparatives in relation to items appearing on the Statement of Financial Position are as at the last balance date, being 30 June 2004. Comparatives in relation to items appearing on the Statement of Financial Performance are for the previous corresponding period, being for the half year ended 31 December 2003.

$1.1$ The Impact of Adopting International Accounting Standards

The Australian Accounting Standards Board is adopting the Standards of the International Accounting Standards Board for application to reporting periods beginning on or after 1 January 2005. Pending Accounting Standard AASB 1 "First-Time Adoption of Australian Equivalents to International Financial Reporting Standards" prescribes transitional provision for first-time adopters.

AASB 1047 "Disclosing the Impacts of Adopting Australian Equivalents to International Financial Reporting Standards" requires financial reports to disclose information about the impacts of any changes in accounting policies in the transition period leading up to the adoption date and will apply for June 2004 reporting.

The economic entity's management, along with its auditors, are assessing the significance of these changes and preparing for their implementation. The Directors are of the opinion that the key differences in the economic entity's accounting policies which will arise from the adoption of IFRS are:

Goodwill on Consolidation/ Discount on Acquisition ${ii}$

Under AASB 122 "Business Combinations", goodwill is to be capitalised in the statement of financial position and subjected to an annual impairment test. Amortisation of goodwill is to be prohibited. The current accounting policy of the entity is to amortise goodwill on a straight line basis over the period of 10 years. Discount on acquisition will no longer be allocated over the non-monetary assets of the entity but be recognised as a gain in the statement of financial performance.

(ii) Income Tax

Currently, the economic entity adopts the liability method of tax-effect accounting whereby the income tax expense is based on the accounting profit adjusted for any permanent differences. Timing differences are currently brought to account as either a provision for deferred income tax or future income tax benefit. Under AASB 112 "Income Tax", the economic entity will be required to adopt a balance sheet approach under which temporary differences are identified for each asset and liability rather than the effects of timing and permanent differences between taxable income and accounting profit.

(iii) Non-Current Investments

Under AASB 139 "Financial Instruments: Recognition and Measurement" financial instruments that are classified as available for sale instruments must be carried at fair value. Unrealised gains or losses may be recognised either in income or directly to equity. Current accounting policy is to measure non-current investments at cost, with a review performed bi-annually by the Directors of the current market value to ensure investments are not in excess of the recoverable amount.

$\overline{\mathbf{2}}$ . LOSS FROM ORDINARY ACTIVITIES

The operating loss from ordinary activities before income tax includes the following items of revenue and expense:

		Consolidated Entity		Company
		31 Dec 04	31 Dec 03	31 Dec 04	31 Dec 03
(a)	Operating revenue	\$	Ś	\$	\$
	Sales revenue
	Consultancy	65,446	69,330	65,446	69,330
	Other revenue
	Interest received - other	3,117	118,564	710	29,888
	Proceeds from sale of share investments	266,617	14,013	30,029	14,013
	Dividends	132,997		11,250
	Other		7,823		7,823
	Total operating revenue	468,177	209,730	107,435	121,054
(b)	Non-operating revenue
	Contribution towards costs		300,000
	Total non-operating revenue		300,000
	Total revenue	468,177	509,730	107,435	121,054
	(c) Expenses
	Cost of sales
	Labour cost	65,446	69,330	65,446	69,330
	Operating expenses
	Occupancy expenses	27,877	40,407	13,390	28,290
	Finance expenses	1,117	2,831	580	1,751
	Borrowing costs - interest paid	121	146	33	26
	Costs of shares sold	269,723	33,030	43,413	33,030
	Administration expenses
	Communications	12,899 38,369	4,123 54,821	4,873 15,356	4,123 54,821
	Other administration expenses Corporate expenses
	Share investment related costs	41,789	16,220	6,091	(17, 576)
	Professional fees	946,890	52,780	142,232	52,780
	Depreciation -property, plant and equipment	1,956	17,353	1,905	15,656
	Fixed assets write down	71	$\ddot{\phantom{0}}$	71
	Personnel	186,110	233,888	107,746	110,806
	Other provisions - employee benefits	10,213	1,144	4,193	11,959
	(Writeback)/Diminution in value
	of share investments	(191, 139)	(21, 488)	125,041	338,044
	Other corporate expenses	42,220	166,623	24,668	15,749
		1,453,662	671,208	555,038	718,789

Professional fees comprise principally the Company's share of legal fees relating to litigation involving Rivkin Financial Services Limited (refer Note 17).

SALE OF ASSETS 3.

Sale of assets in the ordinary course of business have given rise to the following profits and losses:

	Net Loss: (a).	(3,106)	(19.017)	(13,384)	(19.017)
4.	CURRENT RECEIVABLES
	Amounts receivable from
	Other debtors	74.705	58,952	41.657	33,652
	Goods and services tax recoverable	46.350	5.356	6,300	260
		121.055	64.308	47.957	33,912

PROPERTY, PLANT AND EQUIPMENT	Computer equipment	Office furniture and fittings	Total
Consolidated Entity
Gross Carrying Amount	\$	\$	\$
Balance at 30 June 2004	119,118	12,231	131,349
Write down of assets Balance at 31 December 2004	119,118	(10, 751) 1,480	(10, 751) 120,598

Accumulated Depreciation
Balance at 30 June 2004	(115, 231)	(10,778)	(126,009)
Depreciation expense	(1, 846)	(110)	(1,956)
Write off of assets		10,679	10,679
Balance at 31 December 2004	(117, 077)	(209)	(117, 286)
Net Book Value
As at 30 June 2004	3,887	1,453	5,340
As at 31 December 2004	2,041	1,271	3,312
Company
Gross Carrying Amount
Balance at 30 June 2004	113,716	11,491	125,207
Additions
Write off of assets		(10, 751)	(10, 751)
Balance at 31 December 2004	113,716	740	114,456
Accumulated Depreciation
Balance at 30 June 2004	(109, 831)	(10, 727)	(120, 558)
Depreciation expense	(1,846)	(59)	(1,905)
Write off of assets		10,679	10,679
	(111, 677)	(107)	(111, 784)
Balance at 31 December 2004
Net Book Value
As at 30 June 2004	3,885	764	4,649

Aggregate depreciation during the period is recognised as an expense (refer Note 2 of the Financial Statements).

6. OTHER NON-CURRENT FINANCIAL ASSETS

	Consolidated Entity		Company
	31 Dec 04	30 Jun 04	31 Dec 04	30 Jun 04
Investments comprise:	\$	\$	\$	\$
Shares and options in listed corporations - at cost	4,170,612	4,393,810	171.871	214,106
Shares in controlled entities - at cost		÷	3,072,877	3,074,055
Less: Provision for diminution	(693, 216)	(884, 355)	(1,489,161)	(1,364,120)
	3,477,396	3,509,455	1,755,587	1,924,041
Discount on acquisition	(1, 112, 324)	(1, 112, 324)
	2,365,072	2,397,131	1,755,587	1,924,041
Market value of listed investments
Shares in other listed corporations	3,477,396	3,539,458	1,755,587	1,929,044

6. OTHER NON-CURRENT FINANCIAL ASSETS (cont.)

(a) Investment in Controlled Entities	Ownership Interest
	31 Dec 04	30 Jun 04
Sofcom Limited (ABN 88 087 482 602)	81.23%	81.26%

The Company increased its voting power in Sofcom Limited ("SOF") from 41.21% on 30 June 2003 (post the Company's takeover bid for SOF) to 80.54% on 18 July 2003 as a consequence of the cancellation of shares bought back by SOF. On 28 May 2004, a further 320,000 SOF shares were purchased, increasing the Company's voting power in SOF to 81.26%. On 22 December 2004, 14,727 SOF shares were disposed, reducing the Company's voting power in SOF to 81.23%.

Therefore, SOF has been treated as a controlled entity pursuant to Accounting Standard 1024 "Consolidated Accounts" as from 1 July 2003 in this Financial Report. The discount on acquisition of subsidiary represents the excess of the fair value of the net assets of SOF over the Company's carrying value of its investment in SOF, at the time of consolidation, being 1 July 2003. The accounting treatment is consistent with the Accounting Standard 1013 "Accounting for Goodwill".

					Consolidated Entity		Company
7.			CURRENT PAYABLES	31 Dec 04	30 Jun 04	31 Dec 04	30 Jun 04
				\$	\$	\$	\$
		Trade creditors		351,547	9,150	129	1,269
			Other creditors and accruals	531,357	105,981	48,851	41,606
			Director related entities			159,141
			Payables on purchase of investments		364,544		182,272
				882,904	479,675	208,121	225,147
8.			CURRENT PROVISIONS
			Provision for annual leave	48,099	37,886	37,351	33,158
				48,099	37,886	37,351	33,158
			Number of employees (including Executive
			Directors and Officers) at Balance date	4	4	4	4
9.	CONTRIBUTED EQUITY			Consolidated Entity		Company
				31 Dec 04	30 Jun 04	31 Dec 04	30 Jun 04
				\$	\$	\$	\$
	a)		Issued and Paid-Up Capital
			62,018,213 fully paid ordinary shares	8,038,761	8,038,761	8,038,761	8,038,761
	b)	Movement in Ordinary Share Capital
			Balance at beginning of financial period	8,038,761	9,298,760	8,038,761	9,298,760
			Equal Access Scheme Share Buy Back		(1,259,999)		(1,259,999)
				8,038,761	8,038,761	8,038,761	8,038,761
	c)		Movement in Options The number of unlisted options outstanding over
			unissued ordinary shares at 21,590,000. (30 June	31 Dec 04	Consolidated Entity 30 Jun 04	31 Dec 04	Company 30 Jun 04
			2004: 21,590,000).	Number	Number	Number	Number
			The terms of these options are as follows:
		(i)	Options exercisable at 70 cents each on or before 30 June 2005 ("Promoter Options")	18,000,000	18,000,000	18,000,000	18,000,000
		(ii)	Options exercisable at 25 cents each on or before 13 April 2005 ("Incentive Options")	1,090,000	1,090,000	1,090,000	1,090,000
		(iii)	Options exercisable at 7.5 cents each on or
			before 15 May 2007	2,500,000	2,500,000	2,500,000	2,500,000
				21,590,000	21,590,000	21,590,000	21,590,000

10.	OUTSIDE EQUITY INTEREST	Consolidated Entity
		31 Dec 04	30 Jun 04
		\$	\$
	Outside equity interests in controlled entity comprises:
	Contributed equity	4.487.741	4,480,569
	Accumulated losses	(3,976,425)	(3,842,151)
		511,316	638,418
11.	ACCUMULATED LOSSES	Consolidated Entity		Company
		31 Dec 04	30 Jun 04	31 Dec 04	30 Jun 04
		\$	\$	\$	\$
	Balance at beginning of the period	(6, 123, 611)	(4,880,810)	(6,038,464)	(4,880,810)
	Net profit (loss) for the first half of the financial year	(857, 361)	(176, 409)	(447, 603)	(597, 735)
	Net (loss) for the second half of the financial year		(1,066,392)		(559, 919)
	Balance at end of financial period	(6,980,972)	(6, 123, 611)	(6,486,067)	(6,038,464)
12.	LOSS PER SHARE	Consolidated Entity Company
		31 Dec 04	31 Dec 03	31 Dec 04	31 Dec 03
	Basic loss per share (cents)	(1.38)	(0.24)	(0.72)	(0.81)
	Net loss	(857, 361)	(176, 409)	(447, 603)	(597, 735)
	Weighted average number of ordinary shares outstanding during the period used in calculation of basic earnings per share	62,018,213	73,493,623	62,018,213	73,493,623

Diluted loss per share has not been disclosed, as it does not show a position which is inferior to basic earnings per share.

$13.$ SEGMENT REPORTING

The Company operates entirely in software development and IT consultancy and project management sector in Australia. The Consolidated Entity also manages its share investments in Australia. Revenue was earned entirely from activities in Australia.

		External Revenue		Operating Results
Primary Reporting - Business Segments	31 Dec 04	31 Dec 03	31 Dec 04	31 Dec 03
	\$	\$	\$	s
Software development and consultancy	65.446	69,330
Share investments	399,614	14,013	(282, 609)	(13,061)
	465.060	83.343	(282, 609)	(13,061)
Unallocated	3.117	426,387	(702, 876)	(148, 417)
	468,177	509,730	(985, 485)	(161, 478)
		Assets	Liabilities
	31 Dec 04	30 Jun 04	31 Dec 04	30 Jun 04
	\$	\$	\$	s
Software development and consultancy	41,657	32,874
Share investments	2,365,072	2,397,908	(324,046)	(364, 544)
	2,406,729	2,430,782	(324, 046)	(364, 544)
Unallocated	93,379	640,347	(606, 957)	(153, 017)

13. SEGMENT REPORTING (cont.)

Seament	Software development and consultancy	Investments
	31 Dec 04 5	31 Dec 03	31 Dec 04 S	31 Dec 03
Acquisition of segment assets Other non-cash expenses	$\qquad \qquad \blacksquare$		$\sim$	3,051,222
Diminution of segment assets	$\overline{\phantom{a}}$	٠	191.139	21,488

$14.$ STATEMENTS TO CASH FLOWS

Reconciliation of Cash

For the purposes of the statements of cash flows, cash includes cash on hand and in banks and investments in money market instruments, net of outstanding bank overdrafts. Cash at the end of the financial period as shown in the statements of cash flows is reconciled to the related items in the statement of financial position as follows:

		Consolidated Entity			Company
	31 Dec 04	30 Jun 04	31 Dec 03	31 Dec 04	30 Jun 04	31 Dec 03
		\$	\$	\$	\$	s
Cash at bank	10.669	604.350	728.548	$\overline{\phantom{a}}$	296.000	122,053
Term deposit	$\overline{\phantom{a}}$	$\overline{\phantom{0}}$	1,200	$\overline{\phantom{0}}$	$\overline{\phantom{a}}$	1.200
Bank bills	$\overline{\phantom{a}}$	-	1.144.909	÷	$\overline{\phantom{0}}$	348,451
Bank overdraft	$\overline{\phantom{a}}$			(8.050)	$\overline{\phantom{a}}$
	10.669	604.350	1,874,657	(8.050)	296.000	471.704

15. ASSOCIATES AND JOINT VENTURES

The Consolidated Entity did not undertake any investments in associated entities or joint ventures during the financial half year.

16. GAIN/LOSS OF CONTROL OF ENTITIES

There were no entities over which control had been gained or lost by the Consolidated Entity during the financial half year.

17. CONTINGENT LIABILITIES

Rivkin Financial Services Limited Related Litigation

In June 2004, Altera Capital Limited ("AEA") undertook an investment in Rivkin Financial Services Limited ("RFS"). AEA currently has 698,718 shares in RFS (or 0.697% of its current issued capital).

On 14 July 2004, RFS commenced proceedings in the Federal Court of Australia in Sydney against AEA, SOF, and Fast Scout Limited ("FSL") for conduct allegedly contrary to the insider trading provisions of the Corporations Act (in relation to the three companies' acquisition of RFS shares comprising their initial aggregate 5% interest in the Company).

As part of the defence of the action, SOF, FSL and AEA commenced cross-claims against RFS and Network Limited ("Network"), Cole Kablow Superannuation Pty Ltd ("Cole Kablow"), Alan Davis Group Pty Ltd ("ADG") and former RFS Managing Director, Alan Andrew Davis.

Justice Emmett handed down his judgment on 26 November 2004. Justice Emmett dismissed the claim made by RFS against SOF, FSL and AEA and SOF, FSL and AEA's cross-claims against RFS and the other cross-defendants.

$17.$ CONTINGENT LIABILITIES (continued)

On 10 December 2004, Justice Emmett made the following orders as to costs:

In relation to the claim brought by RFS against SOF, FSL and AEA, the Court awarded costs to the $(a)$ defendants on a "party-party" basis;

In relation to the cross claims brought by SOF, FSL and AEA, Fast Scout and Altera Capital to pay all of $(h)$ RFS' and the other cross defendants' costs on an "indemnity basis" provided such costs have been reasonably incurred.

On 17 December 2004, SOF, FSL and AEA lodged an appeal against that part of the decision of Justice Emmett dismissing their cross-claim against each of RFS and the other cross defendants. The appeal covers a number of the findings made by Justice Emmett in his reasons for decision including his decision on costs.

On 4 February 2005, SOF, FSL and AEA entered into a deed of settlement with each of Network and Cole Kablow to discontinue the appeals against and to settle the costs payable to each such party.

Under the deed of settlement with Network, SOF, FSL and AEA have paid \$350,000 to Network's solicitors to settle all costs of Network in relation to the proceedings. The settlement sum will be held on trust by Network's solicitors until the earlier of:

$(a)$ The Network general meeting to seek shareholder approval for Network to buy back and cancel approximately 10m Network shares held by RFS; or

The RFS general meeting to seek shareholder approval for RFS to buy-back and cancel 9 million RFS shares $(b)$ held by Network (being held by no later than 31 May 2005),

(as announced by RFS and Network on 7 February 2005).

Under the deed of settlement with Cole Kablow, SOF, FSL and AEA has paid \$125,000 to Cole Kablow to settle all costs of Cole Kablow in relation to the proceedings.

The deeds of settlement preserves the continuation of the appeals against RFS, ADG and Alan Andrew Davis. In this regard, SOF, FSL and AEA have been advised by their solicitors that the appeal is unlikely to be heard until mid 2005. SOF, AEA and FSL are also negotiating with such parties with respect to the cost orders in the proceedings

The Company considers that, subject to the appeal, the net result of the above costs orders will be that SOF, FSL and AEA will be required to pay a portion of the costs incurred by RFS and the other cross defendants in the proceedings. Notwithstanding the appeal, the process of assessment of costs and, if required, Court taxation of costs may take some months to complete. The Directors are not currently able to specify with any degree of certainty the quantum of net costs it is required to pay the remaining cross defendants in accordance with the above cost orders, particularly in light of the appeal lodged by SOF, FSL and AEA.

The costs of SOF, AEA and FSL in relation to their investment in RFS (including payment of legal costs and the above settlement costs to Network and Cole Kablow) are shared between each company in proportion to each company's relative interest in their collective stake in RFS (currently 4,711,971 shares or 4.697% of RFS' issued share capital) -SOF's share is 67%; FSL's share is 18% and AEA's share is 15%.

SUBSEQUENT EVENTS 18.

As detailed in Note 17 (Contingent Liabilities), on 4 February 2005 AEA, SOF and FSL entered into deeds of settlement with Network and Cole Kablow in relation to the RFS related litigation and SOF subsequently paid a total of \$475,000 pursuant to such deeds.

AEA's share of such costs will be \$71,250 - this has been reflected as professional fees expenses in the half year ended 31 December 2004 and accounts payable (director related entities) as at Balance Date (at the Company level).

DIRECTORS' DECLARATION

In accordance with a resolution of the directors of Altera Capital Limited made pursuant to sub-section 303(5) of the Corporations Act 2001, we state that:

In the opinion of the directors:

The financial statements and notes of the Consolidated Entity are in accordance with $(a)$ the Corporations Act 2001, including:
giving a true and fair view of the Consolidated Entity's financial position as at 31 $(i)$ December 2004 and of their performance for the half year ended on that date; and
complying with Accounting Standards and Corporations Regulations 2001; and $(ii)$
$(b)$ There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

On behalf of the Board,

Farooq Khan Chairman and Managing Director

Perth, Western Australia

24 February 2005

Simon Cato Non-Executive Director

STANTON PARTNERS

1 HAVELOCK STREET WEST PERTH 6005 WESTERN AUSTRALIA

TELEPHONE: (08) 9481 3188

Facsimile: (08) 9321 1204

e-mail: [email protected]

INDEPENDENT REVIEW REPORT TO THE MEMBERS OF ALTERA CAPITAL LIMITED

Scope

We have reviewed the financial report comprising the statement of financial position, statement of financial performance, statement of cash flows, accompanying notes to the financial statements and the directors' declaration of Altera Capital Limited (the Company) for the half-year ended 31 December 2004 as set out on pages 9 to 19. The financial report includes the consolidated financial statements of the consolidated entity comprising the disclosing entity and the entities it controlled at the end of the half year or from time to time during the half year. The disclosing entity's directors are responsible for preparing a financial report that gives a true and fair view of the statement of financial position and performance, and that complies with Accounting Standard AASB 1029 "Interim Financial Reporting", in accordance with the Corporations Act 2001. This includes responsibility for the maintenance of adequate accounting records and internal controls that are designed to prevent and detect fraud and error, and for the accounting policies and accounting estimates inherent in the financial report.

Review Approach

We have performed an independent review of the financial report in order to state whether, on the basis of the procedures described, anything has come to our attention that would indicate that the financial report is not presented fairly in accordance with Accounting Standard AASB 1029: Interim Financial Reporting and other mandatory professional reporting requirements in Australia and statutory requirements, so as to present a view which is consistent with our understanding of the consolidated entity's financial position, and performance as represented by the results of its operations and its cash flows, and in order for the disclosing entity to lodge the financial report with the Australian Securities and Investments Commission.

Our review has been conducted in accordance with Australian Auditing and Assurance Standards applicable to review engagements. A review is limited primarily to inquiries of the disclosing entity's personnel and analytical procedures applied to the financial data. These procedures do not provide all the evidence that would be required in an audit, thus the level of assurance provided is less than that given in an audit. We have not performed an audit and, accordingly, we do not express an audit opinion.

Independence

We are independent of the Company, and have met the independence requirements of Australian ethical pronouncements and the Corporations Act 2001. We have given the directors of the Company a written Auditor's Independence Declaration.

Statement

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the financial report of Altera Capital Limited is not in accordance with:

$(a)$ the Corporations Act 2001, including:
(i) giving a true and fair view of the consolidated entity's financial position as at 31 December 2004 and of its performance for the half year ended on that date; and
(ii) complying with Accounting Standard AASB 1029 "Interim Financial Reporting" and the Corporations Regulations 2001; and
$(b)$ other mandatory financial reporting requirements in Australia.

Inherent Uncertainty Regarding Litigation and Related Costs

Without qualification to the opinion expressed above, attention is drawn to the following matter.

As referred to in note 17 on 26 November 2004 Justice Emmitt ordered that in relation to cross claims brought by the Company, Sofcom Limited ("SOF") and Fast Scout Limited ("FSL") against Rivkin Financial Services ("RFS"), Network Limited, Cole Cablow Superannuation Pty Ltd, Alan Davis Group Pty Limited and Andrew Davis, the cross claimants pay all of RFS' and the other cross defendants costs on an "indemnity basis" provided such costs are reasonably incurred.

On 17 December 2004, the Company, SOF and FSL lodged an appeal against that part of the decision of Justice Emmett dismissing their cross-claim against each of RFS and the other cross defendants.

The Company considers that, subject to the appeal, the net result of the above costs orders will be that the Company, SOF and FSL will be required to pay a portion of the costs incurred by RFS and the other cross defendants in the proceedings. Notwithstanding the appeal, the process of assessment of costs and, if required, Court taxation of costs may take some months to complete. The Directors are not currently able to specify with any degree of certainty the quantum of net costs it is required to pay the remaining cross defendants in accordance with the above cost orders, particularly in light of the appeal lodged by the Company, FSL and SOF.

On 4 February 2005 the Company, SOF and FSL entered into deeds of settlement with Network and Cole Kablow in relation to the RFS related litigation and SOF subsequently paid a total of \$475,000 pursuant to such deeds. The Company's share of these costs as disclosed in note 18 have been provided for in the half year report.

The deeds of settlement preserves the continuation of the appeals against RFS, Alan Davis Group Pty Limited and Alan Andrew Davis. In this regard, the Company, FSL and SOF have been advised by their solicitors that the appeal is unlikely to be heard until mid 2005. The Company, SOF and FSL are also negotiating with such parties with respect to the cost orders in the proceedings

As referred to above, the directors are unable to assess with any acceptable degree of certainty the quantum of net costs it is required to pay, and accordingly no further provision for any liabilities or other adjustments have been made in the financial statements.

STANTON PARTNERS

Storten fastur $g\nu$

J P Van Dieren Partner

West Perth, Western Australia 24 February 2005

STANTON PARTNERS

1 HAVELOCK STREET WEST PERTH 6005 WESTERN AUSTRALIA

TELEPHONE: (08) 9481 3188

Facsimile: (08) 9321 1204

e-mail: [email protected]

24 February 2005

Board of Directors Altera Capital Ltd Level 14 Forrest Centre 221 St Georges Terrace PERTH WA 6000

Dear Directors

RE: ALTERA CAPITAL LTD

In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following declaration of independence to the directors of Altera Capital Ltd.

As Audit Partner for the review of the financial statements of Altera Capital Ltd for the half year ended 31 December 2004, I declare that to the best of my knowledge and belief, there have been no contraventions of:

$(i)$ the auditor independence requirements of the Corporations Act 2001 in relation to the review; and
any applicable code of professional conduct in relation to the review. $(ii)$

Yours sincerely STANTON PARTNERS

$\eta$ lon Iv

John Van Dieren Partner

Au:ALT4286\Dect Ind YE Dec 2004.doc

www.alteracapital.com

ALTERA CAPITAL LIMITED A.B.N. 55 082 541 437

REGISTERED OFFICE:

Level 14, The Forrest Centre 221 St Georges Terrace Perth Western Australia 6000 T | (08) 9214 9787 F | (08) 9322 1515 $E$ | [email protected]

ASX CODE: AEA

ADVANCED SHARE REGISTRY SERVICES:

110 Stirling Highway Nedlands Western Australia 6009 T | (08) 9389 8033 F | (08) 9389 7871 E | [email protected] W | www.asrshareholders.com.au

Central Exchange Limited

A.B.N 77 000 742 843

HALF YEAR REPORTS:

ASX Appendix 4D - Results For Announcement To Market Directors' Report Financial Statements Audit Review Report Auditor's Independence Declaration

31 December 2004

www.centralexchange.com.au

CENTRAL EXCHANGE LIMITED

A.B.N. 77 000 742 843

Level 14, 221 St Georges Terrace, Perth WA 6000 $T$ | + 61 (8) 9214 9797 F | + 61 (8) 9322 1515

$E$ | [email protected]

CONTENTS
ASX Appendix 4D - Results for Announcement to the Market	2.
Directors' Report	4
Statement of Financial Performance	8
Statement of Financial Position	9
Statement of Cash Flows	ю
Notes to Financial Statements	Ħ
Directors' Declaration	17

www.centralexchange.com.au

Visit our website for:

Audit Review Report

Auditors' Independence Declaration

Latest News
Market Announcements
Financial Reports

EMAIL US NOW

[email protected]

CORPORATE DIRECTORY

BOARD

William M. Johnson Victor P.H. Ho Yagoob Khan

(Chairman) (Director) (Director)

COMPANY SECRETARY

Victor P. H. Ho

$17$

$19$

PRINCIPAL & REGISTERED OFFICE

Level 14, The Forrest Centre 221 St Georges Terrace Perth Western Australia 6000

Telephone: +61 8 9214 9797 Facsimile: +61 8 9322 1515

[email protected] Email: Website: www.centralexchange.com.au

SHARE REGISTRY

Advanced Share Registry Services Level 7, 200 Adelaide Terrace Perth Western Australia 6000

Telephone: +61 8 9221 7288 Facsimile: +61 8 9221 7869

STOCK EXCHANGE

Australian Stock Exchange Perth, Western Australia

ASX CODE CXL

AUDITOR

BDO Level 8 256 \$t Georges Terrace Perth Western Australia 6000

BANKER

National Australia Bank Level 13, 50 St Georges Terrace Perth Western Australia 6000

RESULTS FOR ANNOUNCEMENT TO MARKET

This Half Year Report is provided to the Australian Stock Exchange (ASX) under ASX Listing Rule $4.2A.3$

Current Reporting Period:	1 July 2004 to 31 December 2004
Previous Corresponding Period:	1 July 2003 to 31 December 2003
Balance Date:	31 December 2004

RESULTS FOR ANNOUNCEMENT TO THE MARKET

Revenue and Net Profit (Loss)

Consolidated Entity			Dec 2004 \$'000	Dec 2003 \$'000
Revenue from ordinary activities	down	-64.6%	6.773.839	19,137,029
Profit from ordinary activities after tax attributable to members	down	93.0%	1.272.988	18,141,658
Net profit for the period attributable to members	down	93.0%	1.272.988	18.141.658

Dividends

No dividends have been paid or declared during the financial half year. The Directors have made no determination on the payment of a dividend in respect of the current financial year but reserves the right to make such determination prior to the end of the financial year.

Brief Explanation of Revenue, Net Profit and Dividends (above)

$\alpha$ Revenues from ordinary activities include \$6,050,758 gross proceeds from the sale of investments and \$256,550 net unrealised gains on revaluation of investments;
Expenses from ordinary activities include: $(b)$
$\left( i \right)$ \$4,349,599 cost of investments sold;
$(ii)$ \$327,169 costs in relation to share investments - this comprise professional fees (i.e. legal fees and corporate advisory fees) and shareholder communication costs relating to the Company's investment in Rivkin Financial Services Limited.
Accordingly, realised gains on investments were \$1,701,159. $|C|$

For and on behalf of the Directors,

. . . . . . . . . . . . . . . Víctor Ho Company Secretary

Date: 24 February 2005

Central Exchange Limited ("Company" or "Central Exchange") is a company limited by shares that is incorporated and domiciled in Australia and is listed on the Australian Stock Exchange ("ASX") (ASX Code "CXL").

Central Exchange has prepared a consolidated financial report incorporating the entities that it controlled during the financial half year. Controlled entities are Central Exchange Operations Pty Ltd ABN 16 094 097 122 (controlled throughout the financial half year) and Hume Mining NL ABN 52 063 994 945 (controlled throughout the financial half year).

The Directors present their report on Central Exchange and its controlled entities (the "Consolidated Entity"} for the financial half year ended 31 December 2004 ("Balance Date").

OPERATING RESULTS

	Consolidated Entity
	December 2004	December
		2003

Net profit (loss) before tax	1,763,096	19,017,542
Income Tax expense	${490, 108}$	(875, 884)
Net profit (loss) after tax	1,272,988	18,141,658

EARNINGS PER SHARE

	Consolidated Entity
	December 2004	December 2003
Basic earnings per share (cents)	7.39	213.4
Weighted average number of ordinary shares outstanding during the year used in the calculation of basic earnings per share	17.219.996	8.499.263

Diluted earnings per share is not materially different from basic earnings per share and therefore has not been disclosed.

NET TANGIBLE ASSET BACKING

	Consolidated Entity
	December 2004	June 2004	December 2003
Net tangible assets	\$19,355,182	\$18,082,194	\$18,616,071
Fully paid ordinary shares in the Company on issue at Balance Date	17.219.996	17.219.996	8.499.263
Net tangible asset backing per issued ordinary share as at Balance Date (cents)	\$1.12	\$1.05	\$2.19 ⁰

Note:

Pre changes to the share capital structure of the Company: ${1}$

On 11 June 2004, the Company shares were converted on a 2 for 1 basis total issued $(a)$ share capital increased from 8,499,263 to 16,998,526 shares; and
On 29 June 2004, a further 221,470 shares were issued under a prospectus dated 11 June (b) 2004.

DIVIDENDS

REVIEW OF OPERATIONS

1. REINSTATEMENT TO ASX

On 8 July 2004, the Company was re-admitted to ASX as an investment entity (as defined under the ASX Listing Rules) following shareholder approvals at a general meeting on 4 June 2004 and the completion of a prospectus (dated 11 June 2004) on 28 June 2004.

The Company's ASX code remains as "CXL." The Board proposes to seek shareholder approval for a change of name at the next general meeting of the Company.

PORTFOLIO DETAILS AS AT 31 DECEMBER 2004 $2.$

ASSET WEIGHTING

52.45%
0.11%
47.44%

TOP 10 HOLDINGS

Company	$%$ of Net Assets	Industry Sector Exposures
1. Rivkin Financial Services Limited	17.43	Investment Companies (Australian Equities and financial services)
2. National Australia Bank Limited	5.96	Banks
3. Bentley International Limited	4.83	Investment Companies (International equities) Investment Companies
4. Technology Investment Fund	3.76	(Australian and International equities)
5. Rio Tinto Limited	3.03	Minina
6. Lihir Gold Limited	1.80	Minina Investment Companies
7. Global Mining Investments Limited	1.77	(Australian and International equities)
8. Teistra Corporation Limited	1.52	Telecommunication Services
9. Portman Limited	1.45	Mining
10. WMC Resources Limited	1.12	Mining
TOTAL	42.67

INDUSTRY SECTOR WEIGHTING

Sector Exposures	% of Net Assets
Investment Entities	27.9%
Mining and Exploration	9.4%
Banking	6.0%
Oil and Gas	1.0%
Telecommunication	1.5%
Other Sectors	1.8%
Sub-Total Equities
Net Cash/Other Assets	52.4%
TOTAL	100%

ABOUT THE COMPANY

Investment Objectives

The Investment Objectives of the Company are to:

Achieve a consistent high real rate of return, comprising both income and capital growth, whilst operating within acceptable risk parameters set by the Board;
Deliver a regular income stream for shareholders in the form of franked dividends;
Preserve and protect the capital of the Company.

Investment Strategies

The Company seeks to implement an actively managed investment strategy undertaking investments typically into one of two broad investment categories:

Strategic Investments investments in which the Company can reasonably expect to exert a degree of influence, including board representation or through playing an active role alongside management in order to enhance or realise shareholder value; and
Non-strategic Investments investments in entities where attractive investment opportunities develop due to market sentiment or mispricing or where the Company sees other potential for generating positive returns.

The Company does not allocate a fixed proportion of funds into each or any of the above investment categories, since it believes that complete flexibility to invest across these categories is key to maximising long-term value growth for shareholders.

For each strategic and non-strategic investment, the Company will expect to receive a level of return that is commensurate with the level of risk associated with such investment. In each investment and for the investment Portfolio in aggregate, the Company will at least aim to achieve a return that is consistently in excess of an appropriate benchmark share index and or a return which could be earned from investments in cash, bills of exchange or negotiable instruments drawn or endorsed by a bank, non-bank financial institution or a government.

Portfolio Allocation

In executing its investment Strategy, the Company may, from time to time, hold a high proportion of net assets in cash, preferring to be patient and selective rather than filting its Investment Portfolio with mediocre or underperforming investments for the sake of becoming "fully-invested".

The Company will not be limited to the principles of broad diversification; in other words, the Company may invest a significant proportion of funds in any single investment that represents an exceptional opportunity.

Every investment made by the Company will be continuously monitored and formally reviewed on a periodic basis. The Company will be willing to move quickly to realise investments when a view is formed that an investment is overvalued or there has been a material adverse change in an investment's circumstances or prospects - the Company recognises the importance of being nimble and responsive to material changes affecting its investments.

The Company recognises that in some cases, investments take significant periods of time to provide acceptable returns. As such investments may be relatively illiauid, the Company will seek to minimise potential loss in the investment's value where a rapid or unplanned exit from that investment is sought.

Investment Sectors

Investments may be made by the Company in Australia or an overseas market and into any underlying industry, business or sector, in accordance with the Company's stated Investment Objectives and Strategies.

In this regard, the Company has a history of activity in the resource sector. Investments undertaken in this sector will continue to provide the Company with a window into the highly prospective resources sector domestically and globally.

Strategic investments in the resources sector component of the Portfolio may be undertaken:

Directly through pegging of tenements, entering into joint ventures, taking options over and acquiring tenements, projects and joint venture interests;
Indirectly through placements and initial public offerings in existing companies (private, listed, or those seeking admission to ASX); or
Actively the Company recognises funding of exploration and resources development can be a problem for small and medium-sized resource companies (in Australia and overseas) and will seek to assist carefully selected companies in this sector to optimise their opportunities through the provision of funds and a range of financial and management expertise or services as required.

Investment Classes

In pursuit of the Investment Objectives and Strategies outlined above, the Company has discretion in applying its equity and any debt funds to a universe or range of potential investments in assets, businesses, securities, hybrid securities, cash, bills of exchange, other negotiable investments, debentures and other investments and structures - please refer to the Company's website for further details.

Management Of Investments

The Company's implementation of its Investment Strategies in accordance with its Investment Objectives will be carried out by the Board of Directors and the Investment Committee (in conjunction with external consultants and advisers where appropriate).

The Investment Committee comprises Directors William Johnson and Victor Ho and Farooq Khan (a nominee of the Company's controlling shareholder, Queste Communications Limited). Farooq Khan was Chairman and Managing Director of the Company from 4 October 1999 until his resignation on 1 July 2003.

Where necessary, the investment Committee will engage additional specialist resource(s) to assist with the identification, evaluation and management of particular investment opportunities. This includes specialist consultants and advisers, analysts and brokers.

DIRECTORS

The names of Directors in office during and since the financial half year are:

$\mathbf{L}$ William M. Johnson - Chairman
$\overline{2}$ . Victor P. H. Ho - Executive Director
1. Yagoob Khan - Non-Executive Director

Mr Yaqoob Khan is presently resident overseas.

SECURITIES IN THE COMPANY

The current number of the Company's fully paid ordinary shares on issue is 17,219,996.

The Company does not have other securities on issue at the date of this report.

AUDITORS' INDEPENDENCE DECLARATION

The Auditors' Independence Declaration as required under section 307C of the Corporations Act 2001 is attached to this Directors' Report.

Signed for and on behalf of the Directors of Central Exchange Limited in accordance with a resolution of the Board.

William Johnson Chairman

Perth, Western Australia 24 February 2005

Victor Ho Director and Company Secretary

STATEMENTS OF FINANCIAL PERFORMANCE FOR THE PERIOD ENDED 31 DECEMBER 2004

		Consolidated Entity
		31 Dec 04	31 Dec 03
	Note	\$	\$
Revenue from ordinary activities	2(a)		6,773,839 19,137,029
Expenses from ordinary activities:	2(b)
Cost of services		(97)	(2,929)
Personnel		(97, 504)	(32)
Communications		(14,702)	(3,476)
Occupancy		(13, 461)	(13, 673)
Corporate		(52,881)	(49, 598)
Financing		(2, 813)	(755)
Borrowing cost		(1, 458)
Costs in relation to share investments		(327, 169)
Administration expenses
- consultants			$(31,440)$ $(33,534)$
- diminution of investments (written back)		with the	5,384,934
- cost of investment sold			$(4,349,599)$ $(5,391,434)$
- cost of options lapsed		(27, 230)
- exploration expenditure written back/ (off)			$(28,762)$ $(5,469)$
- provision for doubtful debts			(97)
- share issue costs
- other			$(63,627)$ $(3,424)$
Operating income from ordinary activities before income tax expense		1,763,096	19,017,542
Income tax relating to ordinary activities		(490, 108)	(875, 884)
Operating income from ordinary activities after income tax expense		1,272,988	18,141,658

Total revenues, expenses and valuation adjustments attributable to members of the parent entity recognised directly in equity
Total changes in equity other than those resulting from transactions with owners as owners		1,272,988	18,141,658
Basic earnings per share (cents)	11	7.39	213.45
Weighted average number of ordinary shares
outstanding during the period used in calculation of basic earnings per share	11	17,219,996	8,499,263

The statements of financial performance should be read in conjunction with the accompanying notes.

STATEMENTS OF FINANCIAL POSITION AS AT 31 DECEMBER 2004

		Consolidated Entity
		31 Dec 04	30 Jun 04
	Note	\$	\$
CURRENT ASSETS
Cash	13	11,610,075	18,107,239
Receivables	3	94,769	5,675
Other		421
TOTAL CURRENT ASSETS		11,705,265	18,112,914
NON CURRENT ASSETS
Receivables	4	32,833	14,106
Investments	5	9,202,506	1,985,295
Property, plant and equipment Intangibles		28,789	31,599
Other		15,412	24,031
TOTAL NON CURRENT ASSETS		9,279,540	2,055,031
TOTAL ASSETS		20,984,805	20,167,945
CURRENT LIABILITIES
Payables	6	87,997	209,164
Provisions	7	32,682	861,000
Current tax liabilities	8	1,493,544	1,003,436
NON CURRENT LIABILITIES
Provisions		15,400	12,151
TOTAL CURRENT LIABILITIES		1,629,623	2,085,751
NET ASSETS		19,355,182	18,082,194
EQUITY
Contributed equity	9		28,973,124 28,973,124
Reserves		2,124,000	2,124,000
Accumulated losses	10		$(11,741,942)$ $(13,014,930)$
TOTAL EQUITY		19,355,182	18,082,194

The statements of financial position should be read in conjunction with the accompanying notes.

STATEMENTS OF CASH FLOWS FOR THE PERIOD ENDED 31 DECEMBER 2004

		Consolidated Entity
		31 Dec 04	31 Dec 03
	Note	\$	\$
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers			659
Payments to suppliers and employees		(784, 458)	(138, 948)
Payments to exploration and evaluation		(20, 143)	(11, 533)
Interest received		315,552	8,047
Interest paid		(1, 458)
Dividends received		150,979
NET CASH OUTFLOW FROM
OPERATING ACTIVITIES		(339, 528)	(141,775)
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for:
Equity investments		(11, 241, 606)
Options investments		(81,795)
Land and building deposit		(50,000)	(138)
Proceeds from sales of:
Equity investments		5,861,316	48,750
Options investments		183,915
NET CASH (OUT)/INFLOW FROM INVESTING
ACTIVITIES		(5,328,170)	48,612
CASH FLOWS FROM FINANCING ACTIVITIES
Payment to unmarketable parcel shareholders		(1, 149)
Payment for dividends		(828, 317)
NET CASH OUTFLOW FROM FINANCING
ACTIVITIES		(829, 466)
NET DECREASE IN CASH ASSETS HELD		(6,497,164)	(93, 163)
Cash at beginning of the financial period		18,107,239	414,156
CASH AT THE END OF THE FINANCIAL PERIOD	13	11,610,075	320,993

The statements of cash flows should be read in conjunction with the accompanying notes.

$\mathbf{L}$ BASIS OF PREPARATION

This general purpose financial report for the interim half-vear reporting period ended 31 December 2004 has been prepared in accordance with Accounting Standard AASB 1029 Interim Financial Reporting, other mandatory professional reporting requirements (Urgent Issues Group Consensus Views), other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001.

The accounting policies adopted in the preparation of this Half Year Report are consistent with those adopted and disclosed in the financial statements for the year ended 30 June 2004.

1.1 The Impact of Adopting International Accounting Standards

Abas 1047 "Disclosing the Impacts of Adopting Australian Equivalents to International Financial Reporting Standards" required financial reports to disclose information about the impacts of any changes in accounting policies in the transition period leading up to the adoption date and will apply for June 2004 reporting.

(i) Income Tax

Currently, the economic entity adopts the liability method of tax-effect accounting whereby the income tax expense is based on the accounting profit adjusted for any permanent differences. Timing differences are currently brought to account as either a provision for deferred income tax or future income tax benefit. Under the AASB 112 "Income Tax", the economic entity will be required to adopt a balance sheet approach under which temporary differences are identified for each asset and liability rather than the effects of timing and permanent differences between taxable income and accounting profit.

(ii) Non-Current Investments

Under the pending AASB 139 "Financial Instruments: Recognition and Measurement" financial instruments that are classified as available for sale instruments must be carried at fair value. Unrealised gains or losses may be recognised either in income or directly to equity. Current accounting policy is to measure non-current investments at cost, with a review bi-annually by the Directors and valued at current market value to ensure it is not in excess of the recoverable amount of these investments.

The Company has off-market derivative investments such as call and put options which will be required to be booked at market value.

$\overline{2}$ . PROFIT FROM ORDINARY ACTIVITIES

The operating profit from ordinary activities before income tax includes the following items of revenue and expense:

		Consolidated Entity
	31 Dec 04	31 Dec 03
(a) Operating revenue	\$	\$
Telecommunication revenue		659
Settlement deed payment		19,051,014
Interest received - other	315,552	8,047
Proceeds from sale of investments	6,050,758	48,750
Dividend received	150,979
Net unrealised gains on revaluation of investments	256,550	28,559
Total revenue	6,773,839	19,137,029
(b) Operating expenses
Cost of services	97	2,929
Occupancy expenses	13,461	13,673
Finance expenses	2,813	755
Borrowing cost	1,458
Corporate expenses	52,881	49,598
Administration expenses
- Communications	14,702	3,476
- Consultants	31,440	33,534
- Personnel - employee entitlements	3,248
- other	94,256	32
- Costs in relation to share investments	327,169
- Cost of intangibles		2,322,839
- Write back of amortisation of intangibles		(2,322,839)
- Diminution of investments (written back)		(5,384,934)
- Cost of investment sold	4,349,599	5,391,434
- Cost of options lapsed	27,230
- Provision of doubtful debts		97
- Write back of provision for non-recovery
of loans to subsidiary
- Write off loans to subsidiaries
- Exploration expenses	28,762	5,469
- Depreciation expenses	2,810	3,424
- Write off investment
- Other	60,817
	5,010,743	119,487

(c) Sale of Assets

Sale of assets in the ordinary course of business have given rise to the following profits and losses:

Net Gain/(Loss):	1,701,159	(5,342,684)
		Consolidated Entity
CURRENT RECEIVABLES	31 Dec 04	30 Jun 04
	\$	\$
Deposits	50,000	$\mathbf{r}$
Receivables on sale of investments	5,442	$\boldsymbol{\mathrm{m}}$
Other debtors - related parties	330	$\overline{\phantom{a}}$
GST receivables	38.997	5.675

94,769

$5,675$

Consolidated Entity

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL PERIOD ENDED 31 DECEMBER 2004

		Consolidated Entity
4.	NON-CURRENT RECEIVABLES	31 Dec 04	30 Jun 04
		\$	\$
	Bonds and quarantees	32,833	14,106

5.	NON-CURRENT INVESTMENTS
	Investments comprise:
	Shares and options in listed companies - at cost	8,888,467	1,927,806
	Revaluation	314,039	57,489
		9,202,506	1,985,295

	Market value of listed share investments	9.202.506	1.979.934

(i) Shares in listed companies have been revalued at current market value at the Balance Date.

Investment in Controlled Entities:		Ownership interest
	31 Dec 04	30 Jun 03
Hume Mining NL (ACN 064 994 945)
Incorporated in Australia on 29 March 1994	100%	100%
This company is currently engaged in resource related activities.
Central Exchange Operations Pty Ltd (ACN 094 097 122)
Incorporated in Australia on 10 August 2000	100%	100%
This company is currently engaged in property development activities.
		Consolidated Entity
CURRENT PAYABLES	31 Dec 04	30 Jun 04
	\$	\$
Trade creditors	34,048	5,256
Payables on purchase of investments	14,090	152,933
Other creditors - related parties
Other creditors and accruals	39,859	50,975
	87,997	209,164
CURRENT PROVISIONS

Dividend payable	32,682	861,000

This represents unpresented cheques in relation to a 5 cents per share (franked to 60%) paid on 9 July 2004 (with a record date of 6 July 2004 and ex-dividend entitlement date of 30 June 2004).

8. CURRENT TAX LIABILITIES

	31 Dec 04	30 Jun 04

Provision for income tax payable	1.493.544	991.400
Deferred tax liabilities	$\mathbf{r}$	12.036
	1.493.544	1,003,436

			Consolidated Entity
9.		CONTRIBUTED EQUITY	31 Dec 04	30 Jun 04
			\$	\$
		17,219,996 (30 Jun 2004: 17,219,996)
		fully paid ordinary shares	28,973,124	28,973,124
	a)	Movement in Ordinary Share Capital
		Balance at beginning of financial period	28.973.124	28,780,607
		Issue of shares	$\blacksquare$	199.327
		Share issue costs	$\blacksquare$	(6, 810)
		Balance at end of financial period	28,973,124	28,973,124

Fully paid ordinary shares carry one vote per share and carry the right to dividends.

10.	ACCUMULATED LOSSES		Consolidated Entity
		31 Dec 04	30 Jun 04
		\$	\$
	Balance at beginning of the period	13,014,930	30,430,194
	Net profit for the first half of the financial year	(1,272,988)	(18, 141, 658)
	Net profit for the second half of the financial year		(134, 606)
	Provision for dividends		861,000
	Balance at end of financial period	11,741,942	13,014,930
			Consolidated Entity
11.	EARNINGS PER SHARE	31 Dec 04	31 Dec 03
	Basic earnings per share (cents)	7.39	213.45
	Net profit for the period	1,272,988	18,141,658
	Weighted average number of ordinary shares outstanding during the period used in calculation of basic earnings per
	share	17,219,996	8,499,263

Diluted earnings per share is not materially different from basic earnings per share and therefore is not disclosed in the Financial Statements.

12. CONSOLIDATED SEGMENT REPORTING

The Consolidated Entity operates in one geographical segment (Australia) in the investments and resources sectors.

External Revenue		Operating Results
31 Dec 04	31 Dec 03	31 Dec 04	31 Dec 03
\$	\$	\$	\$
6,458,287	19,051,014	1,754,289	19,045,545
	77,309	(30, 412)	70,809
	659	(97)	659
6,458,287	19,128,982	1,723,780	19,117,013
315,552	8,047	39,316	(99, 471)
6,773,839	19,137,029
		1.763.096	19.017.542
		(490,108)	(875, 884)
		1,272,988	18,141,658

SEGMENT REPORTING (contd.)	Assets		Liabilities
	31 Dec 04	30 Jun 04	31 Dec 04	30 Jun 04
	\$	\$	\$	\$
Investments	9,207,948	65,850
Resources	15,412		(2,838)
	9,223,360	65,850	(2,838)
Unallocated	11,761,445	476,349	(1,626,785)	(67,786)
	20,984,805	542,199	(1,629,623)	(67, 786)
		Resources	Investments
Other Segment Information	31 Dec 04	31 Dec 03	31 Dec 04	31 Dec 03
	\$	\$	\$	\$
Acquisition of segment assets	3,261	6.064	11,255,695
Other non-cash expenses
Revaluation/ (diminution) of investments			256.550	5,356,375

The resources segment in 30 June 2004 and 31 December 2003 derived revenues from mining royalties and pursuant to a settlement deed payment from Minara Resources Ltd (formerly Anaconda Nickel Ltd).

The communications segment derived its revenues from the provision of voice telecommunication services, which are no longer in operation.

13. STATEMENT TO CASH FLOWS

Reconciliation of Cash

For the purposes of the statement of cash flows, cash includes cash on hand and in banks and investments in money market instruments, net of outstanding bank overdrafts. Cash at the end of the financial period as shown in the statements of cash flows is reconciled to the related items in the statement of financial position as follows:

		Consolidated Entity
	31 Dec 04	30 Jun 04	31 Dec 03
			s
Cash at bank	375,803	1.668.094	72.100
Bank bills	11.234.272 16.439.145		248.893
	11,610,075	18,107,239	320.993

14. LEASE COMMITMENTS

		Consolidated Entity
	31 Dec 04	30 Jun 04 s
Non-cancellable operating lease commitments:
Not longer than one year	64.986	129,972

The lease is in relation to the office premises of the Company and includes all outgoings. Such expenditure is shared equally with other companies, including Queste Communications Limited (a controlling entity) pursuant to shared office and administration expense arrangements.

15. ASSOCIATES AND JOINT VENTURES

The Consolidated Entity did not undertake any investments in associated entities or joint ventures during the financial half year.

16. GAIN/LOSS OF CONTROL OF ENTITIES

There were no entities over which control had been gained or lost by the Consolidated Entity during the financial half year.

17. CONTINGENT LIABILITIES AND ASSETS

The Consolidated Entity does not have any material contingent assets or liabilities at Balance Date.

18. SUBSEQUENT EVENTS

In December 2004, Central Exchange Operations Pty Ltd (a wholly owned subsidiary of CXL), entered into a contract to acquire an absolute beachfront residential sub-division property located in Mandurah (south of Perth, Western Australia) for \$3.6 million. The contract is due to settle on or about 2 March 2005. The property is suitable for a 4 unit residential development.

DIRECTORS' DECLARATION

In accordance with a resolution of the directors of Central Exchange Limited made pursuant to sub-section 303(5) of the Corporations Act 2001, we state that:

In the opinion of the directors:

The financial statements and notes of the Consolidated Entity are in accordance with $(a)$ the Corporations Act 2001, including:
giving a true and fair view of the Consolidated Entity's financial position as at 31 $\left( i\right)$ December 2004 and of their performance for the half year ended on that date; and
$(ii)$ complying with Accounting Standards and Corporations Regulations 2001; and
$(b)$ There are reasonable arounds to believe that the Company will be able to pay its debts as and when they become due and payable.

On behalf of the Board,

William Johnson

Chairman

Perth, Western Australia

24 February 2005

Victor Ho Director and Company Secretary

Chartered Accountants & Advisers

Level 8, 256 St George's Terrace Perth WA 6000 PO Box 7426 Cloisters Square Perth WA 6850 Tel: (61-8) 9360 4200 Fax: (61-8) 9481 2524 Email: [email protected] www.bdo.com.au

INDEPENDENT REVIEW REPORT TO THE MEMBERS OF CENTRAL EXCHANGE LTD

Scope

We have reviewed the financial report comprising the Statement of Financial Performance, Statement of Financial Position, Statement of Cash Flows, accompanying notes and Directors' Declaration of Central Exchange Ltd for the half-vear ended 31 December 2004. The Company's directors are responsible for the financial report. We have performed an independent review of the financial report in order to state whether, on the basis of the procedures described, anything has come to our attention that would indicate that the financial report is not presented fairly in accordance with Accounting Standard AASB 1029: Interim Financial Reporting, other mandatory professional reporting requirements in Australia and statutory requirements, so as to present a view which is consistent with our understanding of the Company's financial position, and performance as represented by the results of its operations and its cash flows, and in order for the disclosing entity to lodge the financial report with the Australian Securities & Investments Commission.

Our review has been conducted in accordance with Australian Auditing Standards applicable to review engagements. A review is limited primarily to inquiries of the Company's personnel and analytical procedures applied to the financial data. These procedures do not provide all the evidence that would be required in an audit, thus the level of assurance provided is less than given in an audit. We have not performed an audit and, accordingly, we do not express an opinion.

Independence

In conducting our review, we followed applicable independence requirements of Australian professional ethical pronouncements and the Corporations Act 2001. We have given to the director's of the company, a written Auditor's Independence Declaration.

Statement

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year financial report of Central Exchange Ltd is not in accordance with:

the Corporations Act 2001, including: $(a)$
$(i)$ giving a true and fair view of the disclosing entity's financial position as at 31 December 2004 and of its performance for the half-year ended on that date; and
complying with Accounting Standard AASB 1029: Interim Financial Reporting and the $(ii)$ Corporations Regulations 2001; and
other mandatory professional reporting requirements in Australia. $(b)$

BDO

B G McVeigh Partner

Dated: 24^th day of February 2005 Perth, Western Australia

Chartered Accountants & Advisers

Level 8, 256 St George's Terrace Perth WA 6000 PO Box 7426 Cloisters Square Perth WA 6850 Tel: (61-8) 9360 4200 Fax: (61-8) 9481 2524 Email: [email protected] www.bdo.com.au

BGM:IS:IAP:04519

24 February 2005

The Directors Central Exchange Ltd Level 14. The Forrest Centre 221 St Georges Terrace PERTH WA 6000

Dear Sirs

DECLARATION OF INDEPENDENCE BY BDO CHARTERED ACCOUNTANTS TO THE DIRECTORS OF CENTRAL EXCHANGE LTD

To the best of my knowledge and belief, there have been:

no contraventions of the auditor independence requirements of this Act in relation to the review; and
no contraventions of any applicable code of professional conduct in relation to this $\bar{\nu}$ review.

Yours faithfully BDO Chartered Accountants & Advisers

$K$ MUz//

BG McVeigh Partner

AI assistant

COKAL LIMITED — Proxy Solicitation & Information Statement 2005

64656_rns_2005-05-30_61eb885b-882b-4ac4-988d-433d67270a12.pdf

NOTICE OF GENERAL MEETING & EXPLANATORY MEMORANDUM

TO SHAREHOLDERS

IMPORTANT NOTICE

CONTENTS

CORPORATE DIRECTORY

ENQUIRIES

NOTICE OF GENERAL MEETING

AGENDA

ORDINARY BUSINESS

1. Resolution 1 Approval of Return of Capital

$2.$ Resolution 2 Approval of Sale of Shares

TIME AND PLACE OF GENERAL MEETING AND HOW TO VOTE

Venue

How to Vote

Voting in Person

Voting by Proxy

Bodies corporate

Powers of Attorney

Voting Entitlement

VOTING EXCLUSIONS

OTHER NOTES

Role of ASIC and ASX

ASX Listing Rule 10.1

EXPLANATORY MEMORANDUM

SUMMARY $\mathbf 1$ .

1.1 Overview of Resolutions

1.2 Reasons for Return of Capital and Proposed Transactions

1.3 Independent Expert's Report

$1.5$ Indicative Timetable

2. BACKGROUND

$2.1$ "Aggregation Strategy"

2.2 Shareholding in Sofcom Limited (SOF)

2.3 Shareholding in Scarborough Equities Limited (SCB)

2.4 Annual and Half Year Reports

3. FINANCIAL EFFECTS AND CAPITAL STRUCTURE

$3.1$ The Sofcom Return of Capital (SOF ROC)

$(1)$ If Both BEL Share Sale Agreements and the SOF-SCB Option Deed Proceeds to Settlement

$(2)$ If Second Tranche BEL Share Sale Agreement Does Not Proceed to Settlement

The SOF ROC

AEA's share of the SOF ROC

3.2 Sale of SCB Shares

3.3 Amount and Source of Return of Capital

Scenario 1 - The SOF ROC comprises Cash and CXL Shares - Distribution of CXL and SOF Shares Under the AEA ROC

The AEA ROC

Scenario 2 - The SOF ROC comprise Cash, CXL, SOF and BEL Shares - Distribution of CXL, BEL and SOF Shares Under the AEA ROC

The AEA ROC

3.4 Capital Structure

3.5 Shareholdings in the Company

3.6 Effect of Return of Capital on Share Capital

4. TAXATION

5. SUSPENSION FROM ASX

About CXL and BEL 6.

About Central Exchange Limited (CXL) $6.1$

Investment Objectives

Investment Strategies

6.2 About Bentley International Limited (BEL)

$7.$ Resolution 1 - Return of Capital

$7.1$ Section 256 Corporations Act

$7.2$ Clauses 137 and 138 of Constitution

'REDUCTIONS OF CAPITAL

7.3 ASX Listing Rule 7.20

$7.4$ Directors' Interests and Recommendations

8. Resolution 2 - Sale of Shares

$8.1$ SCB Option Deed

8.2 Conclusion of Independent Expert

8.3 Directors' Recommendations

$9z$ GLOSSARY

www.alteracapital.com

ASX CODE: AEA

PROXY FORM

Altera Capital Limited

Appointment of Proxy

Chairman's Open Proxies

Voting directions to your proxy - please mark $[X]$ to indicate your directions

RESOLUTIONS

PLEASE SIGN HERE

INSTRUCTIONS FOR COMPLETING PROXY FORM

COKAL LIMITED Proxy Solicitation & Information Statement 2005

$9_z$ GLOSSARY