MACRO METALS LIMITED — Share Issue/Capital Change 2005

Jul 24, 2005

25 July 2005

The Manager Company Announcements Platform Australian Stock Exchange Limited Level 8, 2 The Esplanade PERTH WA 6000

RE: SALE OF UNMARKETABLE SHAREHOLDING PARCELS

The Directors of Brainytoys Limited ("BRT") wish to advise that they intend to proceed with a sale of unmarketable shareholding interests in BRT.

Pursuant to BRT's Constitution, the directors may proceed with a sale of small. unmarketable parcels in accordance with the following conditions:

• Shareholders whose holding is less than a marketable parcel (\$500) or less may be issued with a written notice ("Small Shareholders Notice") from BRT advising of the proposed sale of their holding and asking those shareholders who do not wish to participate in the sale, to advise the Company:
• recipients of the Small Shareholder Notice must within six (6) weeks of the date of issue of the Small Shareholder Notice advise BRT if they wish to retain their shares and not participate in the sale process. Shareholders who do not respond to the Small Shareholders Notice in writing will be deemed to have authorised BRT to proceed with the sale of their shares:
• at the expiry of the six (6) weeks notice period BRT will sell the shares to Taylor Collison Limited and or its nominee at a price to be set at the lower of \$0.075 per share or at a 15% discount to the 5 day weighted average of the last 5 trading days.
• the resulting proceeds of sale will be remitted to the shareholders whose shares have been sold and, for those shareholders who cannot be identified. BRT will continue to hold the funds on their behalf until they are found; and
• BRT will pay all brokerage and other costs associated with the sale of shares under this procedure.

Based on BRT's recent trading history, the directors intend that those persons holding 6,665 shares or less will receive a notice from BRT.

The directors of BRT wish to emphasise that they actively encourage the participation in BRT by persons wishing to acquire shares in the Company (whether they be existing shareholders or not). This proposed sale exercise is directed more at the smaller, seemingly inactive, shareholdings in BRT as a measure to reduce significant ongoing administrative costs.

Notices are intended to be despatched to the particular small shareholders within the next few days. Further information as to the progress of this activity will be provided in the coming weeks.

Yours faithfully

Jay Stephenson
Company Secretary