MACRO METALS LIMITED — AGM Information 2005

Nov 21, 2005

22 November 2005

Company Announcements Australian Stock Exchange Limited 20 Bond Street SYDNEY NSW 2000

ADDRESS BY ALEX AGUERO MANAGING DIRECTOR To the BRAINYTOYS ANNUAL GENERAL MEETING 22 NOVEMBER 2005

Welcome to you all and thanks for your interest and attendance.

I will firstly spend a few minutes outlining the company's key achievements and milestones before moving onto future activities.

As you will remember, Brainytoys was listed on the Australian Stock Exchange on the 24^th of March 2005 becoming Australia's first and only ASX-listed toy and games Development Company.

As our Chairman has pointed out, that position has some significant benefits as well as some burdens.

In particular, I am conscious of the lack of information we have been able to release to the market.

The release of information at this early stage of our development must be carefully measured as product and commercial confidentiality is a critical part of maintaining a competitive advantage in this industry.

This situation will change significantly over the next few months as we move to release our products to the market and as we progress to develop commercial relationships in Australia and around the world.

The completion of our capital raising in March this year signaled the start of an intensive period of research and product development which continues to this day and which is expected to expand considerably over the next few months.

We have now completed our R & D program for our 2006 product range and our current primary focus is on the commercialisation of these products.

A key milestone for Brainytoys has been the assembling of a talented management and product development team and I would like to take this opportunity to thank our staff. Catherine Vann, our business Manager, Stephen Zadarnowski, our technical Manager, Bradley, Jocelyn, David and Clare our brilliant product development crew, Nadia and Lauren our support staff and the latest addition to our team Tonia McNeilly, our Marketing Manager.

And a special thanks to our Board, Mr. Rob Towner, Mr. Brett Fraser and Mr. Jay Stephenson for their support and diligence in our endeavors.

A critical component of the Company's product development strategy was the commissioning of sophisticated 3D printing machines in April 2005.

One of these printers was the first of its type in Australia and has enabled the Company to rapidly accelerate the prototype and product development cycle.

Since the 3D printers were commissioned, they have facilitated the rapid and cost effective development of a significant number of prototypes and product models in the last six months

I cannot speak highly enough about these devices, I have brought some samples of their output to show you how we put these systems to very good use.

Without these extraordinary tools we would have been unable to develop three quarters of our current product line.

They have proved critical to our endeavours and they have saved us months in time and more money than they cost us.

I specifically note that the development of the Konektors Building Kit product would have been impossibly expensive and time consuming without the 3D plastic printing system.

Brainvtovs also commissioned a 3D Animation "render farm" that enables the Company to develop sophisticated 3D computer-animated imagery of its toy and game products in order to better present the product to potential customers.

This technology is used in the early stages of product development as we create "virtual" models of our products to evaluate functionality, form factors and to get feedback from potential customers.

During the early part of this year we made early-stage presentations to potential distributors both here and overseas, which opened up communication channels to some of the largest toy companies in the world.

On behalf of our talented graphics team I note with some pride that our presentations both here and overseas have received comments like "best presentation we have seen" and "1000% better than anything I have seen".

These particular comments came from two top tier American companies, which shall remain nameless for the moment because they may well become distribution partners.

More recently we have engaged with and are coordinating developing relationships with suppliers and selected manufacturing partners in Taiwan, Hong Kong, China and the USA.

The manufacture processes and associated logistics is something we have to manage with great care and we are confident that we have selected appropriate companies to support our development and manufacture program.

Brainytoys has over 30 products in the development pipeline.

The toys and games cover a broad range of market and demographic segments including:

• Electronic toys $\mathbf{1}$
• $\overline{2}$ Hand-held games
• 3 Remote control toys
• $\overline{4}$ Board games
• 5 Construction Kits
• 6 Novelty/specialty products
• $\overline{7}$ Collectables
• 8 Plush
• 9 Educational toys

After a considered process of product evaluation, taking into account industry feedback. Brainytoys has chosen the first 15 of its toys and games to form its 2006 season product range.

In general terms, the product list includes:

• Two hand-held electronic games
• One electronic novelty product
• Two, possibly three board games we are evaluating a Licensing opportunity which may bring the total to three
• One table game
• One building kit system project Konektors, which may well have a potential as a stand alone business unit
• Two remote control vehicle products with range extension potential (meaning we may be able to release more than two) and with one specifically targeting girls, which is a under serviced market segment with Remote Control products
• One electronic game for Boys focusing on physical activity $\bullet$
• Two electronic "wall games"
• Two novelty electronic products with a twist on a common-use electronic device
• One plush product

I am sorry I can't go into the specific details for most of our products just yet, but soon enough they will make their public appearance.

The exact timetable for release will be set in consultation with our distribution partners.

I am happy to discuss the products in general terms at the end of my address and show some prototypes we have brought along.

I am very proud of the fact that we have brought these many products, to this stage, in the relatively short period of time since our full development program began in March and April of this year.

I believe we have a strong mix of products covering a wide spectrum of market and demographic segments, reducing our risk factor and allowing us to probe the market as widely as we can.

These products are the tip of a very large and growing iceberg, if I can put it that way.

Every product that we develop generates a technical and design legacy, which makes the task of product development much simpler and faster the second time around and I can assure you that we are taking good advantage of this bonus.

We already have in excess of 20 product concepts in our developmental pipeline for 2007 and beyond.

I am sure this list will continue to grow.

The Company has received very strong expressions of interest from Australian and overseas toy and game companies and distributors.

I am acutely aware of course that the task ahead is to convert our design and development efforts into sales and given the strong, and widespread, level of interest expressed so far, I am quite confident that we can achieve this critical milestone.

This process is about to commence and will run through the next few months.

We are in the process of evaluating a number of options related to our distribution program and we will, of course, inform the market as to any developments in this area.

The important timeframe for this process is the first six months of next year, the key dealmaking season for this industry, leading into the Christmas 2006 season.

On my part, I remain supremely confident that we are building a business with the potential to create innovative products on an ongoing basis which will generate substantial returns to you, our shareholders; I thank you for your patience and support.

Thank you.