MACRO METALS LIMITED — AGM Information 2005

Oct 24, 2005

BRAINYTOYS LIMITED

ABN 28 001 894 033

NOTICE OF ANNUAL GENERAL MEETING

• TIME: 10.00am (WST)
• DATE: 22 November 2005
• PLACE: London House 216 St Georges Terrace Perth, Western Australia

This Notice of Meeting should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their professional advisers prior to vofing.

Should you wish to discuss the matters in this Notice of Meeting please do not hesitate to contact the Company Secretary on (08) 9228 0703.

CONTENTS PAGE

Letter to Shareholders	3
Notice of Annual General Meeting (setting out the proposed resolutions)	4
Explanatory Statement (explaining the proposed resolutions)	6
Glossary	8

Proxy Form

TIME AND PLACE OF MEETING AND HOW TO VOTE

VENUE

The Annual General Meeting of the Shareholders of Brainytoys Limited to which this Notice of Meeting relates to will be held at 10.00am (WST) on 22 November 2005 at:

London House 216 St Georges Terrace Perth, Western Australia

YOUR VOTE IS IMPORTANT

The business of the Annual General Meeting affects your shareholding and your vote is important.

VOTING IN PERSON

To vote in person, attend the Annual General 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:

• send the proxy form by post to 6/34 York Street, North Perth, Western Australia $(\alpha)$ 6006; or
• $(b)$ by facsimile to the Company on facsimile number (08) 9228 0704,

so that it is received not later than 10.00am (WST) on 20 November 2005.

Proxy forms received later than this time will be invalid.

CHAIRMAN'S LETTER

Dear Shareholder

On behalf of the Board, I have pleasure in inviting you to the Annual General Meeting of shareholders of Brainvtovs Limited. The meeting will be held at 10:00am on the 22^nd of November 2005 at London House, Level 1, 216 St Georges Terrace.

The strategic direction of the Company has been revised over the previous 12 months, and structural changes have shifted the Company's focus from being an investment company to a toy and game development company. The Company was re-registered as Brainytoys Limited in November 2004 to reflect these changes and more accurately describe the nature of our business

A significant milestone was reached with the identification of a suitable investment opportunity and the subsequent acquisition of 100 per cent of Brainytoys.com Pty Ltd in October 2004. This acquisition was made possible through the raising of \$1,010,000 in seed capital by issuing shares to sophisticated investors in December 2004 and a public offer for \$1,750,000 in March 2005.

The capital raised has been used to strategically position Brainytoys in the toy and game development industry and to acquire assets to boost the infrastructure available to the Company. A proportion of the capital raised has also been invested in the research and development of various toy and game products.

The Company has over 30 toys and games currently in development, and will be ready to progress some of these products to manufacturing within the next six to twelve months.

The Company has recently met with leading toy and game distributors in Australia, Europe and North America with a view to identifying sales and market targets both domestically and internationally. Brainytoys is actively developing relationships with large toy and game manufacturing companies around the world.

Recently acquired technological equipment, including 3D printers, has enabled the Company to accelerate the development cycle of multiple products.

The expertise of our highly experienced senior management team led by our Managing Director, Alex Aguero, will drive the growth of Brainytoys during this next year and beyond. The recently announced appointment of Tonia McNeilly as Marketing Manager further strengthens our management team.

The next twelve months will be an exciting time as Brainytoys moves from the product development phase to manufacturing, distribution, marketing and ultimately product sales, generating cash flow for the Company.

Yours sincerely

BRAINYTOYS LIMITED ROBERT TOWNER CHAIRMAN

NOTICE OF ANNUAL GENERAL MEETING

Notice is given that the Annual General Meeting of Shareholders of Brainytoys Limited will be held at London House, 216 St Georges Terrace, Perth, Western Australia at 10.00am (WST) on 22 November 2005.

The Explanatory Statement to this Notice of Meeting provides additional information on matters to be considered at the Annual General Meeting. The Explanatory Statement and the proxy form are part of this Notice of Meetina.

The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Annual General Meeting are those who are registered Shareholders of the Company at the close of business on 20 November 2005.

Terms and abbreviations used in this Notice of Meeting and Explanatory Statement are defined in the Glossary.

AGENDA

ORDINARY BUSINESS

$\mathbf{1}$ . ACCOUNTS

To receive and consider the Annual Financial Report together with the Directors' and Auditor's Reports for the period ended 30 June 2005.

SPECIAL BUSINESS

$2.$ RESOLUTION 1 - RE-ELECTION OF DIRECTOR - MR BRETT FRASER

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

"That, for all purposes, Mr Brett Fraser, a director of the Company who retires by rotation in accordance with Clause 3.6 of the Constitution and, being eligible, is re-elected as a Director of the Company."

3. RESOLUTION 2 - ADOPTION OF A NEW CONSTITUTION

To consider and, if thought fit, to pass, with or without amendment, the following resolution as a special resolution:

"That, pursuant to Section 136(2) of the Corporations Act and for all other purposes, the Company adopts a new constitution in the form as signed by the Chairman of the Annual General Meeting for identification purposes, in lieu of the existing constitution of the Company, at the close of the Annual General Meeting."

Short Explanation: Pursuant to Section 136 of the Corporations Act, a company may adopt a new Constitution by a special resolution passed at a general meeting.

4. RESOLUTION 3 - NON-EXECUTIVE DIRECTORS' REMUNERATION

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution:

"That, for the purposes of clause 10.2 of the Constitution, Listing Rule 10.17 of the Listing Rules of Australian Stock Exchange Limited and all other purposes, the Company approves the maximum agaregate amount that may be paid to Non-Executive Directors as remuneration for their services in each financial year be set at \$150,000 which may be divided among those Directors in the manner determined by the Board of the Company from time to time."

Short Explanation: Clause 10.2 of the Constitution requires that the maximum aggregate remuneration that be paid to Non-Executive Directors of the Company be set by the Company in general meeting.

Voting Exclusion: The Company will disregard any votes cast on this Resolution by a Director of the Company and any of their associates.

DATED: 12 October 2005

BY ORDER OF THE BOARD

BRAINYTOYS LIMITED ALEXANDER AGUERO MANAGING DIRECTOR

Voting Exclusion Note:

Where a voting exclusion applies, the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote in accordance with the directions on the proxy form or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

EXPLANATORY STATEMENT

This Explanatory Statement has been prepared for the information of the Shareholders of the Company in connection with the business to be conducted at the Annual General Meeting to be held at London House, 216 St Georges Terrace, Perth, Western Australia on 22 November 2005 at 10am (WST).

This purpose of this Explanatory Statement is to provide information which the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions in the Notice of Meeting.

$\mathbf{1}$ FINANCIAL STATEMENTS AND DIRECTORS' REPORTS

In accordance with the Company's Constitution, the business of the meeting will include receipt and consideration of the Company's Financial Report and reports of Directors and Auditors for the year ended 30 June 2005.

$\overline{2}$ . RESOLUTION 1 - RE-ELECTION OF DIRECTOR - MR BRETT FRASER

Clause 3.6 of the Constitution requires that if the Company has three or more Directors, one third of those Directors must retire at each annual general meeting and are eligible for re-election.

The Company currently has three Directors and accordinaly one must retire. Pursuant to these Clauses Mr Brett Fraser will retire by rotation and seeks re-election.

Mr Fraser has been working in the Investment and Finance industries for 20 years. This has involved serving as a director on public and private companies across a range of industries. Having financed and/or managed property projects, corporate takeovers, initial public offerings and corporate turnarounds, Mr Fraser now assists companies with strategy and growth. He is an active investor in a number of projects and industries.

$\overline{3}$ . RESOLUTION 2 - ADOPTION OF A NEW CONSTITUTION

A company may modify or repeal its constitution or a provision of its constitution by special resolution of Shareholders. Resolution 2 is a special resolution which will enable the Company to adopt a new constitution.

The current constitution has been in existence since 1987 and may not reflect current Corporations Law.

It is not practicable to fist all of the changes to the Constitution in this Explanatory Statement and Shareholders are invited to contact the Company if they have any queries or concerns. For this purpose, a copy of the proposed new constitution is available for review by Shareholders at the office of the Company.

$\overline{4}$ RESOLUTION 3 - NON-EXECUTIVE DIRECTORS' REMUNERATION

Clause 10.2 of the Constitution requires that the maximum aggregate remuneration that may be paid to Non-Executive Directors of the Company be set by the Company in a general meeting.

Resolution 3 seeks Shareholder approval to increase the maximum aggregate remuneration that may be paid to Non-Executive Directors from \$84,000 to \$150,000 per annum. This aggregate amount has been determined after reviewing similar companies listed on ASX and the Directors believe that this level of remuneration is in line with remuneration of similar companies. In addition, the current level of Non-Executive Directors remuneration has not been adjusted since 1996.

The Company currently has 2 Non-Executive Directors, being Robert Towner and Brett Fraser. For each of the past 2 years, the Non-Executive Directors of the Company have received total annual remuneration as follows:

Director	Remuneration
Robert Towner	Nil*
Brett Fraser	\$34,500

* Mr Towner was only recently appointed as a Director on 19 September 2005 and, accordingly, has not received any remuneration for the past 2 years.

If Resolution 3 is passed, the fees paid to the Non-Executive Directors of the Company may increase in the future.

PROXY FORM

APPOINTMENT OF PROXY BRAINYTOYS LIMITED ABN 28 001 894 033

$I/We$

being a Member of Brainvtoys Limited entitled to attend and vote at the Meeting, hereby

Appoint

Name of proxy

or failing the person so named or, if no person is named, the Chairman of the Meeting or the Chairman's nominee, to vote in accordance with the following directions or, if no directions have been aiven, as the proxy sees fit at the General Meeting to be held at 10:00am on 22 November 2005 at London House, Level 1, 216 St Georges Terrace Perth WA 6000 and at any adjournment thereof. If no directions are given, the Chairman will vote in favour of all of the resolutions.

Voting on Business of the General Meeting
	FOR	AGAINST	ABSTAIN
Resolution 1 – Re-election of Director – Mr Brett Fraser Resolution 2 – Adoption of New Constitution Resolution 3 – Remuneration of Non-Executive Directors
$\mathbf{r}$ . The set of the set of the set of the set of the set of the set of the set of the set of the set of the set of the set of the set of the set of the set of the set of the set of the set of the set of the set of t

If you do not wish to direct your proxy how to vote, please place a mark in this box

By marking this box, you acknowledge that the Chairman may exercise your proxy even if he has an interest in the outcome of the resolution and votes cast by him other than as proxy holder will be disregarded because of the interest. The Chairman will vote in favour of all of the resolutions if no directions are given.

YOU MUST EITHER MARK THE BOXES DIRECTING YOUR PROXY HOW TO VOTE OR MARK THE BOX INDICATING THAT YOU DO NOT WISH TO DIRECT YOUR PROXY HOW TO VOTE, OTHERWISE THIS APPOINTMENT OF PROXY FORM WILL BE DISREGARDED.

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.

Signed this day of 2005

By:

Individuals and joint holders

Companies (affix common seal if appropriate)

Sianature

Signature

Signature

Director

Director/Company Secretary

Sole Director and Sole Company Secretary

BRAINYTOYS LIMITED ABN 28 001 894 033

Instructions for Completing 'Appointment of Proxy' Form

• $\mathbf{L}$ A member entitled to attend and vote at a Meeting is entitled to appoint not more than two proxies to attend and vote on their behalf. Where more than one proxy is appointed, such proxy must be allocated a proportion of the member's voting rights. If the shareholder appoints two proxies and the appointment does not specify this proportion, each proxy may exercise half the votes.
• $\overline{2}$ . A duly appointed proxy need not be a member of the Company. In the case of joint holders, all must sian.
• 1. Corporate shareholders should comply with the execution requirements set out on the proxy form or otherwise with the provisions of Section 127 of the Corporations Act. Section 127 of the Corporations Act provides that a company may execute a document without using its common seal if the document is signed by:
• directors of the company: $\bullet$
• a director and a company secretary of the company; or
• for a proprietary company that has a sole director who is also the sole company secretary - that director.

For the Company to rely on the assumptions set out in Section 129(5) and (6) of the Corporations Act, a document must appear to have been executed in accordance with Section 127(1) or (2). This effectively means that the status of the persons signing the document or witnessing the affixing of the seal must be set out and conform to the requirements of Section 127(1) or (2) as applicable. $\ln$ particular, a person who witnesses the affixing of a common seal and who is the sole director and sole company secretary of the company must state that next to his or her signature.

• 1. 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. Where a proxy form or form of appointment of corporate representative is lodged and is executed under power of attorney, the power of attorney must be lodged in like manner as this proxy.
• To vote by proxy, please complete and sign the proxy form enclosed: 6.
• $(a)$ send the proxy form by post to Brainytoys Limited, 6/34 York Street, North Perth, Western Australia 6006; or
• $(b)$ by facsimile to the Company on facsimile number (08) 9228 0704,

so that it is received not later than 10,00am (WST) on 20 November 2005.

Proxy forms received later than this time will be invalid.