Level 5, 34 Hunter Street Sydney NSW 2000 GPO Box 4406 Sydney NSW 2001

Phone: +612 9221 7155 Fax: +612 9233 2713 Email: [email protected] Web: www.hgl.com.au

Dear Shareholder

MMC Contrarian Limited

I am pleased to introduce you to an exciting opportunity to invest in a new investment company, MMC Contrarian Limited, which is anticipated to be listed during December 2003 on the Australian Stock Exchange. MMC Contrarian is the result of a joint initiative by HGL and MMC Asset Management.

MMC Asset Management is headed by Mr Erik Metanomski. Mr Metanomski has a successful long term track record as a fund manager, particularly in smaller companies. His longest running fund has provided an average annual return of 22.1% after fees over the past 10 years to 30 June 2003.

MMC Contrarian will differ from most investment companies by focussing on out-of-favour or overlooked stocks that have upside potential. MMC Contrarian will also benefit from HGL's ability to influence corporate change, it will be managed with a strong philosophy of capital preservation and a focus on a strong rate of capital appreciation over the medium to long term.

For HGL shareholders, MMC Contrarian offers three key benefits

it establishes a new and growing area of recurring income as HGL will derive 40% of the management and performance fees
it offers an opportunity for HGL to leverage our investment skills across a substantially larger capital base and
it provides you with an opportunity to participate in the float of a listed investment company with a contrarian style by subscribing for shares that we believe will be sort after in the market

HGL shareholders will receive a preferential allocation of $20 million from the total offer of up to $150 million, on a first come first served basis, if the enclosed Priority Application Form is returned by Friday 7th November 2003 to Bell Potter Securities, Level 28, 80 Collins Street, Melbourne, Vic, 3000. Each $1 share also has a free option to subscribe for another share at $1 any time up to 30 June 2005.

The offer of shares, and options to acquire shares, in MMC Contrarian Limited is made in the prospectus dated 10 October 2003. I recommend that you read the enclosed prospectus carefully before making your investment decision.

If you would like to attend a presentation on MMC Contrarian, please call Claire Vicars at HGL on 02 9221 7155, who will advise where and when presentations are scheduled. For more information please see our website www.hol.com.au.

HGL currently has eleven other operating businesses turning over in excess of $110m owned in partnership with management and we continue to seek further acquisitions that meet our investment criteria.

Yours sincerely

نعمجد

Peter G Miller Chairman

investing in businesses

Proposed Manager

M&GIC Pty Limited Level 5, 34 Hunter Street Sydney NSW 2000 Telephone: (02) 9221 7155 Facsimile: (02) 9233 2713

Sponsoring Broker

Bell Potter Securities Limited Level 28, 80 Collins Street Melbourne VIC 3000 Securities Dealers Licence No.: 13172 Telephone: 1300 305 476

Auditor

Deloitte Touche Tohmatsu Grosvenor Place 225 George Street Sydney NSW 2000 Telephone: (02) 9322 7000 Facsimile: (02) 9322 7001

Independent Accountant

Deloitte Corporate Finance Pty Limited Grosvenor Place 225 George Street Sydney NSW 2000 Telephone: (02) 9322 7000 Facsimile: (02) 9322 7001

Tax Advisor

Deloitte Touche Tohmatsu Limited Grosvenor Place 225 George Street Sydney NSW 2000 Telephone: (02) 9322 7000 Facsimile: (02) 9322 7001

Share Registry

Computershare Investor Services Pty Limited Level 3, 60 Carrington Street Sydney NSW 2000 Telephone: 03 9611 5711

Solicitors to the Offer

Watson Mangioni Level 13 50 Carrington Street Sydney NSW 2000 Telephone: (02) 9262 6666 Facsimile: (02) 9262 2626

INDICATIVE TIMETABLE

10 OCTOBER 2003
1700000882003
17 OCTOBER 2003
15 DECEMBER 2003
29 DECEMBER 2003

The above dates are indicative only and may vary, subject to the requirements of the Listing Rules and the Corporations Act.

The Company reserves the right to close the Offer earlier than 15 December 2003 or extend the Closing Date.

No Shares or Options will be issued on the basis of this Prospectus later than the expiry date of this Prospectus being the date 13 months after the date of this Prospectus.

The Company will apply to ASX for the Shares and Options listed for quotation on ASX within 7 days after the date of this Prospectus.

incl

Licensed Intermediaries		2
Prospectus AvailabilityHow to ApplyWhen to Apply
			Enquiries		3
				Chairman's Letter	4
	1. INFORMATION FOR INVESTORS	5
11	The Offer	5
1.2	Business Overview	5
1.3	Management	5
1.4	Risk Factors	6
1.5	Offer not Underwritten	6
1.6	Minimum Subscription	6
1.7	How to Apply	$\overline{\mathcal{I}}$
1.8	ASX Listing	$\overline{7}$
1.9	Allotment	8
	1.10 CHESS	8
1.11	Overseas Shareholders	8
	2. MMC CONTRARIAN LIMITED	8
2.1	Overview of Business	8
$2.2 -$	Company Objectives	9
$2.3 -$	Investment Philosophy	9
$2.4 -$	Investment Strategy	9
2.5	Permitted Investments	11
2.6	LIC Status	11
2.7	Reports to Shareholders	11
	3. INFORMATION ON MMC	12
$3.1 -$	Business of MMC	12
$3.2 -$	MMC's Investment Team	12
$3.3 -$	Investment Process	12
3.4	Performance History	14
	4. INFORMATION ON HGL	15
4.1	Business of HGL	15
4.2	Background of HGL	16
4.3	Investment Process	17
4.4	Performance History	17
	5. MANAGEMENT STRUCTURE	17
5.1	Joint Management Structure	17
5.2	Business of Proposed Manager	18

11 111.211.311.411.511.611.711.8	Balance Date and Company TaxStatusLicensed DealersRights Attaching to the SharesRights Attaching to the OptionsMaterial ContractsASX WaiversDividend Re-Investment PlanMatters Relevant to the Directors11.9 Remuneration of Directors11.10 Related Party Transactions11.11 Legal Proceedings11.12 Consents and ResponsibilityStatements11.13 Interest of Experts	32323232343939404141414143














	11. ADDITIONAL INFORMATION	32
	10. TAXATION OPINION	28
REPORT		26
	9. INDEPENDENT ACCOUNTANT'S
8.3	Tax Considerations	25
8.2	Investor Considerations	24
8.1	General Risk Factors	23
	8. RISK FACTORS	23
74	Corporate Governance	22
73	Kevin Eley	22
72	Erik Metanomski	22
71	Chairman - Simon Rowell	21
	7. DIRECTORS	21
64	Dividend Policy	21
63	Income Tax	20
6.2	Proposed Accounting Policies andNotes to Accounts	20
	Position	19
61	6 FINANCIAL INFORMATIONPro Forma Statements of Financial	19
	management	18
5.5	Board participation in

5.4	Key Personnel of the Manager	18

Hel

IMPORTANT NOTICES

This Prospectus is dated 10 October 2003 and was lodged with the Australian Securities & Investments Commission (ASIC) and the Australian Stock Exchange Limited (ASX) on 10 October 2003. No responsibility for the contents of this Prospectus is taken by the ASIC or the ASX or any of their officers.

This document is important and requires your immediate attention. It should be read in its entirety. You may wish to consult your professional adviser about its contents.

No person is authorised to give any information or make any representation in connection with the Offer which is not contained in this Prospectus. Any information or representation not so contained or taken to be contained may not be relied on as having been authorised by the Company in connection with the Offer.

Defined terms and abbreviations included in the text of this Prospectus are set out in the Glossary in Section 12. Unless the context otherwise requires, references to Manager are references to both MMC Asset Management Limited and M&GIC Pty Limited in their capacities as interim manager and proposed manager of the Portfolio respectively.

LICENSED INTERMEDIARIES

Offers under this Prospectus will be made pursuant to an arrangement between the Company and licensed securities dealers or Australian Financial Services licensees (dealer) pursuant to Section 911A(2)(b) of the Corporations Act. The Company will only authorise dealers to make offers to people to arrange for the issue of Shares and Options by the Company under the Prospectus and the Company will only issue Shares and Options in accordance with such offers if they are accepted.

The Company will forward all Application Forms and Application Monies to Bell Potter Securities Limited (Bell Potter). Bell Potter will deposit and deal with the Application Monies pursuant to this Prospectus.

PROSPECTUS AVAILABILITY

This Prospectus is available in electronic form on Bell Potter's website at www.bellpotter.com.au. The Offer or invitation to which the Electronic Prospectus relates is only available to persons receiving the Electronic Prospectus in Australia.

The Company will send to a person a copy of the paper Prospectus and paper Application Form free of charge if the person asks during the Offer period.

The Shares and Options to which the Electronic Prospectus relates will only be issued on receipt of a printed copy of the electronic Application Form. The Application Form may be generated by software accessible by the same means as the Prospectus.

HOW TO APPLY

An application for Shares and Options under this Offer can only be made by completing and lodging the Application Form attached to the back of this Prospectus. Detailed instructions on completing the Application Form can be found on the back of the Application Form.

Applications must be for a minimum of 2,000 Shares and 2,000 Options for a total of $2,000. Applications may be made for additional Shares and Options in multiples of 100 Shares and 100 Options for $100.

Applications must be accompanied by payment in Australian currency of $1.00 per Share. Cheques should be made payable to "MMC Contrarian Limited - Float Account" and crossed "Not Negotiable". No brokerage or stamp duty is payable by Applicants.

Completed Application Forms, together with Application Monies, should be forwarded to the following address:

MMC Contrarian Limited Share Offer C/- Bell Potter Securities Limited Level 28, 80 Collins Street Melbourne VIC 3000

WHEN TO APPLY

Completed Applications must be received by Bell Potter Securities Limited prior to 5.00 pm (EST) on the Closing Date. The Directors may close the Offer at any time after expiry of the exposure period without prior notice or extend the Offer period in accordance with the Corporations Act. Early lodgement of your application is recommended as the Offer may be closed early.

Bell Potter is the sponsoring broker to the Offer. Bell Potter's function should not be considered as an endorsement of the Offer nor a recommendation of the suitability of the Offer for any investor. Bell Potter does not guarantee the success or performance of the Company or the returns (if any) to be received by investors. Neither Bell Potter nor any other dealer is responsible for or has caused the issue of this Prospectus.

The Directors reserve the right to allocate any lesser number of Shares and Options than those for which the Applicant has applied. Where the number of Shares and Options allotted is fewer than the number applied for, surplus Application Monies will be refunded without interest.

ENQUIRIES

Investors with questions on how to complete the Application Form or who require additional copies of the prospectus should contact Bell Potter on 1300 305 476 or [email protected].

MMC Contrarian Limited ACN 106 248 248

10 October 2003

Dear Investor

As Chairman of the Board of Directors, I am pleased to invite you to become a shareholder in MMC Contrarian Limited (Company).

The Company is raising capital primarily to invest in the Australian stock market, using the skills of personnel provided by two highly experienced investors, MMC Asset Management Limited (MMC) and HGL Limited (HGL) (ASX code: HNG). The objectives of the Company include capital growth and the payment of dividends.

The name MMC Contrarian has been chosen because the investment philosophy to be adopted by the Company is contrary to the "herd" mentality which can often influence fund managers. Our philosophy is that investments will be evaluated on fundamental criteria to identify opportunities which have been undervalued by the market in general and therefore over time are expected to be rerated. Our investment criteria are set out in more detail in Section 2 of the Prospectus.

MMC and HGL each have an excellent long term track record in selecting investments and although past experience cannot be used as an indication of future performance, the success of the investment strategies adopted by each over a number of years indicates that the fundamental principles their personnel propose to apply are sound and effective.

I encourage you to read this Prospectus carefully before making your investment decision as it contains detailed information about the Company and the offer of Shares and Options to investors.

I recommend this Prospectus to you and look forward to welcoming you as a shareholder of the Company.

Yours sincerely

Simon Rowell Chairman

1. INFORMATION FOR INVESTORS

$1.1$ The Offer

MMC Contrarian Limited (Company) offers for subscription up to 150,000,000 Shares at $1.00 per Share to raise up to $150,000,000. For each Share issued, subscribers will receive 1 free Option to subscribe for a Share at an exercise price of $1.00 exercisable by 30 June 2005.

Up to 20,000,000 Shares have been set aside for a priority allocation to existing shareholders of HGL. This Priority Allocation will be restricted to the shareholders of HGL who lodge applications by 7 November 2003. These shareholders should use the Priority Allocation Form. For further details, HGL shareholders should contact David Sutherland or Kevin Eley at HGL on (02) 9221 7155.

Shares in the Priority Allocation that are not taken up will be allocated by the Company or, subject to fulfilment of the minimum subscription, not issued at the election of the Company.

1.2 Business Overview

The Company has been established to provide investors with access to the benefits of the skilled investment personnel of MMC and HGL and their understanding of the share market. The objectives of the Company include capital growth and the payment of dividends.

Each of the registered managed investment schemes managed by MMC outperformed the All Ordinaries Accummulation Index during the year to June 2003. For more details on this, see Section 3.4. HGL has achieved a 13.42% per annum increase in total shareholder return, being an increase in share price assuming reinvestment of dividend payments, in the ten years to 30 September 2003. In the same period the All Ordinaries Accumulation Index increased by 9.00%. See Section 4.4 for more details.

The historical performance of MMC Funds and HGL should not be taken as a guide to the future performance of the Company.

The Company's Portfolio will be managed with a strong philosophy of capital preservation and a focus on achieving a superior rate of capital appreciation over the medium to long term. See Section 2 for details on the Company's investment strategy.

It is intended that the Company will satisfy the criteria to be considered a listed investment company (LIC) for the purposes of the Income Tax Assessment Act 1997 (Cth). As a result of being a LIC, tax concessions may be available to Shareholders which allow the benefit of the discount capital gains tax regime to "flow through" to them in a similar way that would be available if the Company had been established in a trust structure.

The ability of Shareholders to enjoy these tax concessions is dependent, among other things, on the nature of the Company's investments and the time period in which the Company holds those investments. Unless there is a compelling reason not to do so, the Company will seek to satisfy the LIC requirements to make available these tax concessions for Shareholders. See Sections 2.6, 6.3, 8.3 and 10 for details.

$1.3$ Management

It is proposed that the portfolio of investments of the Company will be managed by M&GIC Pty Limited (Proposed Manager). The Proposed Manager is a new management company owned by MMC as to 60% and HGL as to 40%.

Een

The Proposed Manager is a newly incorporated company and does not presently hold an Australian Financial Services licence (AFSL) and so cannot presently provide these management services. Until an AFSL is granted, management of the Portfolio will be undertaken by MMC, presently a holder of an AFSL. An application for an AFSL is expected to be lodged during the offer period of this Prospectus.

The benefits for Shareholders however are the same. MMC and HGL will make available skilled investment advisors, initially through MMC and then through the Proposed Manager to manage the investment strategy of the Company.

This joint management structure provides investors with a rare opportunity to take advantage of the complementary investment skills of MMC and HGL. For further details see Section 2.

Throughout this Prospectus, references to Manager are references to MMC as interim Manager and the Proposed Manager as the context requires.

Management Fee

The Manager will receive a management fee equivalent to 1.25% per annum of gross assets of the Company, calculated and payable monthly in arrears.

Performance Fee

Where the Portfolio has increased in value over a 12 month performance calculation period, the Manager will also be entitled to a performance fee of 15% of:

where the level of the All Ordinaries Accumulation Index has increased over that period, the amount by which the value of the Portfolio exceeds this increase; or
where the All Ordinaries Accumulation Index has decreased over that period, the amount of the increase in the value of the Portfolio.

In line with the Company's objective of capital preservation, no performance fee will be payable to the Manager in respect of any performance calculation period where the Portfolio has decreased in value over that period. See Section 11.5 for details.

$1.4$ Risk Factors

An investment in the Company is speculative and involves a number of risks. While the Manager intends to use prudent management techniques to minimise the risks to Shareholders, no assurances can be given by the Company as to the success or otherwise of its business.

Investors should consider the risk factors identified in this Prospectus, particularly those identified in Section 8, before applying for Shares and Options.

Offer not Underwritten $1.5$

The Offer is not underwritten.

$1.6$ Minimum Subscription

The minimum subscription for the Offer is $25,000,000, being receipt of valid Applications for not less than 25,000,000 Shares and 25,000,000 attaching Options. If this minimum subscription is not achieved and the Application Price for these Shares is not received by the Company by the date 4 months after the Opening Date, the Company will repay all Application Monies within 7 days after that date without interest.

1.7 How to Apply

Applications for Shares and Options must be made and will only be accepted on the Application Form issued with and attached to this Prospectus.

An Application Form must be completed in accordance with the instructions set out on the reverse side of the Application Form. Applications must be for a minimum of 2,000 Shares and 2,000 Options for a total of $2,000. Applications may be made for additional Shares and Options in multiples of 100 Shares and 100 Options for $100.

Applications must be accompanied by payment in Australian currency of $1.00 for each Share and Option applied for. Cheques must be made payable to "MMC Contrarian Limited - Float Account" and crossed "Not Negotiable". Payments by cheque will be deemed to have been made when the cheque is honoured by the bank on which it is drawn. No stamp duty or brokerage is payable by Applicants. The amount payable on Application will not vary during the period of the Offer and no further amount is payable on allotment.

Completed Application Forms and accompanying cheques may be lodged with:

MMC Contrarian Limited Share Offer C/- Bell Potter Securities Limited Level 28, 80 Collins Street Melbourne VIC 3000

A binding contract to issue Shares and Options will only be formed at the time Shares and Options are allotted to Applicants.

Application Forms will be accepted at any time after the issue of this Prospectus and prior to the close of business on the Closing Date. Early lodgement of your Application is recommended as the Offer may be closed early.

$1.8$ ASX Listing

Application will be made to ASX within 7 days after the date of this Prospectus for the Company to be listed on the ASX and for quotation of the Shares and Options issued pursuant to this Prospectus and all other Shares on issue as at the date of such quotation.

The fact that ASX may list the Company is not to be taken as an indication of the merits of the Company or the Shares or Options. ASX quotation, if granted, will commence as soon as practicable after holding statements are dispatched.

The Directors do not intend to allot any Shares and Options unless and until ASX grants permission for the Shares and Options to be listed for quotation unconditionally or on terms acceptable to the Directors. If permission is not granted for the Shares and Options to be listed for quotation before the end of 3 months after the date of this Prospectus or such longer period permitted by the Corporations Act with the consent of ASIC, all Application Moneys received pursuant to the Prospectus will be refunded without interest to Applicants in full within the time prescribed by the Corporations Act.

Hel

1.9 Allotment

No allotment of Shares and Options will be made until the minimum subscription has been received and permission has been granted by ASX for quotation of the Shares and Options unconditionally or on terms acceptable to the Directors. It is expected that allotment of the Shares and Options will take place by 22 December 2003.

The Company will forward all Application Forms not bearing a dealer's stamp that it receives to Bell Potter. All Application Monies pursuant to this Offer will be held in a subscription account until allotment. This account will be kept by Bell Potter on behalf of the Applicant.

An Application constitutes an offer by the Applicant to subscribe for Shares and Options on the terms and subject to the conditions set out in this Prospectus. Where the number of Shares and Options allotted is less than the number applied for or where no allotment is made, the surplus Application Monies will be returned by cheque within 7 days of the Closing Date. Interest will not be paid on the refunded Application Monies.

1.10 CHESS

The Company will apply to ASX to participate in the Securities Clearing House Electronic Subregister System known as CHESS. CHESS is operated by the ASX's Securities Clearing House (SCH) in accordance with the ASX Listing Rules and the SCH Business Rules. Under CHESS, the Company will not be issuing certificates to investors who elect to hold their shares on the CHESS subregister. After allotment of Shares, Shareholders will receive a CHESS statement.

The CHESS statements which are similar to bank account statements, will set out the number of Shares allotted to each Shareholder pursuant to this Prospectus. The statement will also advise holders of their holder identification number and explain for future reference the sale and purchase procedures under CHESS.

Further statements will be provided to holders which reflect any changes in their shareholding in the Company during a particular month.

1.11 Overseas Shareholders

The Offer does not constitute an offer in any place in which, or to any person to whom, it would be unlawful to make such an offer.

$\mathbf{2}$ . MMC CONTRARIAN LIMITED

$2.1$ Overview of Business

MMC Contrarian Limited has been formed in order to provide Shareholders with exposure to a specific investment style of disciplined value and proactive involvement in its investments.

The Company provides the only way to gain exposure to the investment efforts of the Proposed Manager being a joint venture between MMC and HGL (ASX code: HNG).

The Manager will manage the assets of the Company with:

a strong philosophy of capital preservation; and
a focus on a superior rate of capital appreciation over the medium to long term.

The Manager will, if appropriate, attempt to influence the activities of the companies in which it invests. HGL executives have considerable experience in this area.

Kei

The Company will predominately invest in ASX listed securities. The Company also intends to take substantial shareholdings, but not more than 10% without prior Board approval, in a number of smaller listed companies. The Manager intends to take a medium to long term view with respect to investments. The Company may maintain potentially large cash holdings if attractive, low risk investments cannot be found.

The Company believes that combining the investment skills of MMC and HGL should provide the Manager with a blend of skills that will assist in meeting the investment objectives of the Company.

The Company will actively manage its capital to maximise the return to shareholders. This may include:

A dividend reinvestment plan;
Buy-back of Shares when the Shares are trading at a discount to net tangible assets; and
The issue of Shares through options, bonus or rights issues to shareholders.

2.2 Company Objectives

The objectives of the Company are to:

Exceed the return of the All Ordinaries Accumulation Index over the medium to long term, within the risk parameters established by the Manager to preserve capital.
· Pay regular franked dividends.
Preserve the capital of the Company.
Limit investments to those which are consistent with the strategies and philosophies of the Manager outlined in this Prospectus.

2.3 Investment Philosophy

The Manager's underlying investment philosophy is built on:

· capital preservation, buying at a discount to intrinsic value;
· independent thinking (contrarianism); and
· discipline.

This leads to a general strategy of investing in businesses that may be bought at a discount to intrinsic value.

2.4 Investment Strategy

The investment strategy of the Manager is to identify investment opportunities at a discount to what the Manager deems intrinsic value. Additionally, the Manager may identify situations where it can contribute to an improvement in the underlying business by participating in the operational process of the business. This may take the form of a board seat, consultancy or executive position. The Manager has access to skilled personnel for such roles or may choose to bring in external specialists.

The Manager will seek out attractive investment opportunities that develop due to sentiment or stockmarket driven mispricing of securities or mismanagement of core businesses. The Manager refers to these as event driven" opportunities, where events have created a market mood or sentiment that has led the market to sell securities down to prices that are attractive to value investors.

EGI

The Manager's strategy is to take advantage of event driven opportunities such as:

Change of management.
Business downturn due to short-term industry issues.
· Liquidation and the distribution of cash or securities to shareholders.
· Takeover, merger or break-up of a company.
Litigation that would increase a company's value if resolved in its favour.
· Expansion through a valuable acquisition.
· Company or industry rationalisation.
An important technological breakthrough or discovery.

The Manager will take a medium to long term approach to investment outcomes regardless of market fashion or short term trends. This discipline can lead to short term underperformance as sentiment sometimes drives markets in inational ways. The Manager will maintain a disciplined approach in its attempts to avoid investments that do not comply with its absolute value focus.

The investment Portfolio of the Company may comprise shares, cash, hybrid securities and debentures. Subject to attractive and available opportunities that meet the Manager's investment criteria and the extent of the capital raising under this Prospectus, there is likely to be 10 to 30 Securities in the Portfolio, which the Manager and the Company believes will reduce investment risk and achieve adequate portfolio diversification.

Research and Investment Process

The Manager will use a broad and value based investment procedure to value entities before calculating a risk/reward ratio for potential investments. This risk/reward ratio ultimately leads to a decision to allocate capital or not and if so, how much to allocate. Every different investment has a different risk profile and therefore needs to be looked at on an individual basis.

The emphasis of the Manager's research process will be on the long term operating performance and outlook of a business. The Manager will not be concerned with day to day share price movements except as they provide opportunities to take advantage of the market's over-pessimism or optimism.

The Manager will typically assess management ability, the historic profitability of a business, free cash flow generation, balance sheet strength and future prospects to calculate the intrinsic value of a business. This process involves a thorough analysis of an investee's financial accounts. Also, members of the investment team will generally meet with key management of the investee to obtain a comprehensive understanding of the business. Further research may include discussion with industry competitors, employees, customers, suppliers and other interested parties to increase understanding of a business.

Ongoing monitoring of an investment will be conducted via regular meetings with management and industry and press reports. As well, the Manager will monitor the operating and financial progress of a company by its return on invested capital, profit margin, operating cash flows and debt levels over a period of time.

The above strategy may be achieved through the purchase of shares or other permitted investments. See Section 2.5 for details.

$2.5 -$ Permitted Investments

The Manager is permitted to invest in the following on behalf of the Company:

$(a)$ Securities quoted on the ASX;
$(b)$ any Security which the Manager expects will be quoted on the ASX within a 12 month period from the date of investment;
$\langle c \rangle$ warrants and options;
(d) cash or interests in cash management trusts;
$(e)$ debentures, unsecured notes and bonds;
(f) to the extent permitted by the Manager's AFSL, derivatives and short selling of Securities; and
other financial products as permitted by the Manager's AFSL. (g)

2.6 LIC Status

The Company considers that the tax concessions available to Shareholders as a result of the Company being considered a LIC are an important benefit to be made available to Shareholders. Accordingly, when determining whether to undertake or realise an investment on behalf of the Company, the Manager will have regard to the impact of that investment or realisation of an investment on the LIC status of the Company and, unless there is considered to be a compelling reason to do so, will not undertake any action which would jeopardise that status. In particular, any investment which would result in the Company holding more than 10% of the issued Securities of an investee may only be made with the prior approval of the Board.

Notwithstanding that it is presently considered beneficial for Shareholders, there can be no certainty that the tax concessions presently available will continue to be available to Shareholders or will be advantageous for all Shareholders. Similarly, changes in the taxation legislation or the interpretation of that legislation may require each of the Manager and the Company to reconsider its position on the issues outlined above. Moreover, the Manager may consider that the financial benefits associated with undertaking or realising an investment may outweigh any taxation consequences for Shareholders. Accordingly, potential Applicants should not make a decision to apply for Shares and Options under this Prospectus solely on the basis of any taxation benefit.

$2.7$ Reports to Shareholders

To assist Shareholders assess the value of Shares and Options and to comply with the Listing Rules, within 14 days of the end of each month the Company will release to the Shareholders through the ASX a statement of net tangible asset backing of its Shares as at the end of the preceding month. The calculation of the net tangible asset backing will be made in accordance with the Listing Rules and will be independently calculated.

The Company will provide the holders of Shares and Options on request, free of charge, with a copy of the net tangible asset backing statement.

Hei

3. INFORMATION ON MMC

$3.1$ Business of MMC

MMC Asset Management Limited was founded in 1993 by Erik Metanomski as a boutique value focussed funds manager based in Adelaide, South Australia. MMC has been successful in growing funds under management through a consistent pursuit of capital protection and low risk returns. MMC was recently recognised as a finalist in Morningstar's Emerging Australian Equities Manager for 2002.

MMC is an unlisted public company. Its major shareholders are presently Erik Metanomski (22.5%), HGL (23.2%), Australian Heritage Group Limited (16.5%) and Peter Constable (6.3%). HGL has agreed to acquire the interests of Australian Heritage Group Limited subject to receipt of MMC shareholder approval.

MMC is the responsible entity for 5 registered managed investment schemes (MMC Funds). Through these MMC Funds, it manages total funds (as at 30 September 2003) of approximately $200 million.

MMC recently acquired AM Constable Limited, a boutique funds manager. AM Constable Limited is the manager of the Strategic Value Trust, a retail investment trust focussing on smaller undervalued Australian companies. AM Constable Limited had funds under management of approximately $8 million as at 30 September 2003 of which approximately $3.5 million had been contributed by HGL.

$3.2$ MMC's Investment Team

Erik Metanomski BA B.EC, Joint Chief Investment Officer and Executive Director, is experienced in equities analysis and portfolio management having worked within the industry for the last 17 years with a variety of groups including Taylor Collison and Providence Funds Management. Erik has been responsible for building and developing MMC's investment philosophy. Erik's prime focus is equities research and managing the MMC Funds.

Peter Constable B.EC, Joint Chief Investment Officer and Executive Director, began his investment career working for the United Bank of Kuwait, London, as a portfolio manager in 1992, moving on to Royal & Sun Alliance (now Promina) as a portfolio manager in 1996. Peter then joined HGL in 1997 where he worked for four years identifying listed investment opportunities. During this time Peter served on the board of Hunter Hall International Limited (an ASX listed boutique manager) as a non-executive director before leaving HGL to establish AM Constable Limited in October 2001.

Peter Constable was the founder and chief investment officer of AM Constable Limited, a successful Sydneybased boutique investment manager that specialised in undervalued smaller Australian industrial equities. The investment process of AM Constable Limited focused on taking positions in a small number of undervalued stocks that it believed provided exceptional investment prospects without significant risk to capital.

Sam Le Cornu, analyst, began part time employment with MMC during his university study and joined MMC as a full time analyst in November 2002. Sam holds a Bachelor of International Business, majoring in marketing and Japanese and a Bachelor of Commerce with a major in business finance and a minor in business law.

3.3 Investment Process

MMC has adopted a disciplined investment philosophy. It judges the merits of Securities in accordance with the operating performance of the underlying business, and not in accordance with fluctuations in their short term price quotes on the share market. It is MMC's belief that, in the longer term, when the operating performance of businesses are superior, the stock market will at some point acknowledge this by marking their Security prices higher.

MMC does not feel compelled to make investments unless the variables that constitute its investment criteria are perceived to be in its favour. This has been demonstrated through the high level of cash holdings across MMC Funds held consistently throughout its history. As at 30 September 2003, the MMC equity funds held just over half of their assets in cash or interests in cash management trusts.

MMC's focus is on absolute returns rather than reference to any equity index benchmark. The research process is extremely thorough, and includes an in-depth assessment of a company's financial statements, extensive interviews with company management, discussions with competitors and/or suppliers, and research on the outlook for the industry in which the company operates. MMC looks at each business as if it were the "owner" of the business. Should any of the criteria that led to a company being invested in change, then MMC will re-evaluate its investment.

This investment process focuses on the company's ability to generate free cash flow rather than its reported accounting earnings. The financial analysis focuses on a range of criteria including dividend policy, revenues, margins, recurring capital expenditure, return on capital, sales, EBITA, cash flow, cost of capital, products and markets.

This investment process also places a high emphasis on the ability of the investee's management. Once a stock is included in the portfolio, MMC keeps in close contact with the company to ensure that everything is going as expected and that the company's management is canying out the strategies previously articulated.

A fair value is determined for each stock; once this price has been reached, the valuation will be reassessed and the stock sold if it is determined as overvalued.

In line with this approach, the investment criteria applied by MMC when assessing a potential investment are as follows:

DESIRABLE INVESTMENT CRITERIA

The management of the company should own a material number of shares in the entity
The company should not be capital intensive
The company should be producing an attractive level of "free" cash flow
Good companies which find themselves temporarily out of favour with the market or have been the subject of negative reporting
Companies that have an identifiable growth profile
Companies where management has a record of performance and integrity
. Companies which show an empathy toward shareholder returns
Companies that generate an attractive return on capital employed
Companies with attractive investment fundamentals such as low price to earnings and cash flow multiples that reflect undervaluation now, rather than based upon some rosy perception of what may happen in the future
An appraised value standing at a significant premium to the prevailing share price

MMC methodically monitors the market focussing primarily on the industrial small to mid cap ASX universe, searching for value. While MMC Funds may invest in any listed companies, MMC has developed a view that the best combination of quality and value tends to be found in the small to mid cap industrials. There is a strong focus on investigating stock market events that create mispricing and therefore, profitable opportunities.

Capital allocation is executed based on perceived risk of each individual investment and our knowledge of each company. In MMC Funds, exposure to individual investments generally ranges from 2% to 10% of a fund's capital although there is no rigid allocation structure in place. Allocation is driven by MMC's desire to preserve capital and maximise returns.

MMC Funds will hold cash if compelling investments cannot be found, confident that value always returns and opportunities will always come to those who search hard enough and are patient.

3.4 Performance History

MMC acts as responsible entity or manager for the MMC Funds. The investment strategy applied by MMC in acting as responsible entity for the MMC Funds may differ from that proposed to be adopted by the Manager and the Company. Moreover, the size of the MMC Funds may differ from the anticipated size of the Portfolio. The taxation treatment of distributions paid from the MMC Funds may differ from that proposed for the Company which may also have an impact on the investment approach adopted for the Company.

Accordingly, the following information regarding the performance history of the MMC Funds cannot be taken as a guide as to the future performance of the Company.

MMC Asset Management Value Growth Trust is MMC's longest running managed scheme. This fund primarily focuses on buying small to medium capitalised listed equities using the MMC value approach to investing. This fund was established as the Malvern Unit Trust in 1993, and changed to the MMC Asset Management Value Growth Trust in September 1999 when all unitholders redeemed their unitholding in Malvern Unit Trust and entered the MMC Asset Management Value Growth Trust.

The combination of the Malvern Unit Trust and the MMC Asset Management Value Growth Trust provides a performance history of 22.1% per annum net performance return over a period of 10 years to 30 June 2003. The MMC Asset Management Value Growth Trust had a net performance of 12.7% for the 2003 financial year. As at 30 September 2003, this fund had unitholder funds of approximately $38 million.

The MMC Wholesale Australian Share Fund came into existence in January 2000, and has a net performance return of 12.7% per annum over the period of three years to 30 June 2003. The Wholesale Fund had a net performance of 7.71% for the 2003 financial year. The MMC Wholesale Australian Share Fund has similar investment objectives to the MMC Asset Management Value Growth Trust. Its performance fee benchmark is the All Ordinaries Accumulation Index. As at 30 September 2003, this fund had unitholder funds of approximately $100 million.

The MMC Income Plus Fund came into existence in October 2001 and had a net performance of 5.73% for the nine months to 30 June 2002 and 8.13% for the 12 months to 30 June 2003. Its objective is to provide a better than cash return to invested capital without taking on material additional risk. The fund's performance fee benchmark is the bank bill swap rate plus 2.5%. Its primary investment universe is debt securities, listed property trusts and high yielding, low risk equities. As at 30 September 2003 unitholder funds stood at approximately $57 million.

The MMC Property Securities Fund came into existence in October 2001 and had a net performance of 22.9% for the 9 months to 30 June 2002 and 11.91% for the 12 months to 30 June 2003. Its objective is to provide a high level of capital preservation and exposure to the listed property trust (and company) sector of the ASX via a value, stock-picking approach. The fund's performance benchmark is the S&P/ASX 300 Property Trust Accumulation Index. As at 30 September 2003, the MMC Property Securities Fund had unitholder funds of approximately $3 million.

The Strategic Value Trust managed by AM Constable Limited came into existence in March 2002. For the year to 30 June 2003, this trust achieved a net performance of 21.2%, placing it third among 982 open or closed retail unit trusts according to fund data provided by Morningstar. Its objective is to provide capital growth over its benchmark, the All Ordinaries Accumulation Index, by buying a small concentrated portfolio of value and growth stocks that are trading at less than assessed fair value. The trust is expected to become MMC's small companies fund and as at the end of September 2003 had unitholder funds of approximately $8 million.

4. HGL

Business of HGL 4.1

HGL is listed on the ASX with ASX code HNG. HGL has been an investor in small cap Australian securities for the last decade. HGL has invested in both listed and unlisted Securities.

As at 30 September 2003, the total value of HGL investments in listed Securities (based on the closing price on ASX on that date) was approximately $11,250,000. HGL investments often represent a stake enabling HGL to have influence on the operation of its investee. Investments undertaken by HGL in recent years include investments in Becker Group Limited ($438,000 invested for 6.07%), Environmental Recovery Services Group ($4.0 million for 23%), Lemarne Corporation Limited ($4.2 million for 20.0%), Sabre Group Limited ($5.4 million for 15.1%) and Reinsurance Australia Corporation Limited ($1.9 million for 6.7%).

HGL holds a 23% interest in MMC and has recently agreed to acquire a further 16.5% interest, subject to receipt of MMC shareholder approval. Details of MMC are contained in Section 3.

HGL also invests in and manages private companies. Most private businesses within HGL are partially owned by their management. An equity and management structure closely links HGL's equity partners' wealth to the profitability of the business they operate. This greatly assists in focussing each enterprise on its goals.

HGL has around $40 million invested in eleven private import and distribution businesses. These businesses have combined annual sales of $110 million and annual earnings before interest and tax of $10 million.

HGL contributed approximately $3.1 million to the Strategic Value Trust established by AM Constable Limited in March 2002.

HGL's first hand experience of owning and managing private business contributes greatly to enhanced investment decisions in the listed Security arena.

EGI

4.2 Background of HGL

HGL's origins go back to 1904 when it was incorporated to acquire the sawmilling and timber business of Hancock & Gore. It was subsequently listed on the Brisbane Stock Exchange. In 1981, interests associated with Hooper Bailie Industries Limited acquired a 40% interest in HGL.

In 1987, the association with Hooper Baille ceased when it undertook an in specie distribution of its shares. HGL then became revitalised as an investor in property, listed equities and private companies. In January 2002 Hancock and Gore Limited changed its name to HGL Limited.

As at 30 September 2003, HGL had a market capitalisation of approximately $75 million.

The key executives of HGL are as follows:

Kevin Eley (Chief Executive Officer).
Michael Mahoney (Company Secretary and Operations Manager).
Andrew Whittles (Chief Financial Officer).
David Sutherland (Investment Manager).

Messrs Eley and Sutherland are responsible for managing the listed securities of HGL. Messrs Mahoney and Whittles are primarily focused on managing and acquiring private businesses.

Details of the background and experience of Messrs Eley and Sutherland are as follows:

Kevin Eley CA, ASIA has been a director and CEO of HGL since joining HGL in 1985. Prior to joining HGL, he had gained over 10 years of business experience in management consulting, financing and corporate advice at a major international firm of Chartered Accountants and two Investment Banks.

At HGL Kevin has assisted HGL with all its private and public acquisitions. This has included identifying and researching opportunities and then planning the strategy for the relevant acquisition. He has represented HGL on the boards of Solander Holdings Limited, Leutenegger Limited, Laubman and Pank Holdings Limited and Sabre Group Limited. He has also been involved in the disposal and restructuring of a number of HGL operating investments.

Kevin has been instrumental in developing HGL's philosophy of partnering with management in its operating investments. Kevin is a director of MMC and a number of HGL's operating subsidiaries.

David Sutherland B sc (Agr) has worked in the investment and banking industry for over 23 years. He was initially involved in the merchant banking industry, then later was a Director in charge of Fixed Income with Credit Suisse First Boston.

David was then General Manager Investments, for FAI Life Insurance from 1995 to 1998, where the portfolios were transformed from being volatile and underperforming funds to ones with consistent strong returns.

Subsequently he ran a private investment fund and acted as a consultant to wealthy individuals before joining HGL to continue a role of identifying and managing strategic investment opportunities.

4.3 Investment Process

HGL assesses the underlying performance of proposed investments. This assessment process includes:

· Rigorous review of publicly available information
· Discussions with company management
Review of the market(s) in which the company operates

A key part of HGL's review is an assessment of the downside risk in an investment. Such analysis includes considering the implications of the loss of a major customer, a general decline in sales, reduction in the gross margin and an increase in the amount of working capital required in the business. HGL also considers the effects of increased competition within the relevant industry and the loss of key management from the business.

The experience HGL has gained by owning and managing private businesses greatly assists in the risk assessment process. HGL understands that a good business, being one that it wishes to own, comprises an excellent management team that is focused, products or services that customers desire, high barriers to entry and the maintenance of sound administration systems.

Two key ratios that HGL calculates and monitors are the earnings before interest and tax (EBIT) to sales ratio and EBIT to capital employed ratio. HGL considers that these two ratios can be indicative of the ability of a company to withstand shocks applied to it.

Discussions with company management and the review of financial information continue after an investment has been made.

$4.4 -$ Performance History

HGL has a 30 September year end. In the period from September 1990 to September 2002, HGL has reported average compound earnings per share growth of 10%. As at the date of this Prospectus the results to 30 September 2003 have not been finalised.

The All Ordinaries Accumulation Index has increased by 9.0% per annum in the 10 years since 30 September 1993. HGL achieved a 13.42% per annum increase in total shareholder return (being an increase in share price assuming reinvestment of dividend payments) over the same 10 year period.

The historical performance of HGL should not be taken as a guide to the future performance of the Company.

5. MANAGEMENT STRUCTURE

5.1 Joint Management Structure

MMC and HGL have established a joint venture company to provide portfolio management services to the Company. They have established the Proposed Manager to provide a portfolio management service to the Company under a long term management agreement, details of which are set out in Section 11.5.

The Proposed Manager does not presently hold an AFSL and so may not provide portfolio management services for the Company or any other party. An application for an AFSL is expected to be lodged during the offer period of this Prospectus. MMC and HGL are assisting the Proposed Manager in submitting its application and have no reason to believe that an AFSL will not be granted. If the Proposed Manager is unable to obtain an AFSL by 31 December 2004, the Management Agreement with the Proposed Manager automatically terminates and management of the Portfolio will remain with MMC.

Until an AFSL is granted to the Proposed Manager, portfolio management services will be provided to the Company by MMC. Details of the interim management agreement with MMC are set out in Section 11.5.

HGL has agreed to initially make available the services of Kevin Eley and David Sutherland to assist MMC in providing these management services. They will participate as members of an interim investment committee including Erik Metanomski and Peter Constable of MMC. In return for making available the services of these executives, HGL will receive a fee equal to 40% of the management and performance fees payable to MMC under the interim management agreement. See Section 11.5 for details of these joint venture arrangements.

5.2 Business of Proposed Manager

The Proposed Manager was incorporated on 26 September 2003 to undertake the management of investment companies and funds. As at the date of this Prospectus, the Proposed Manager does not hold an AFSL and so does not provide portfolio management services to any entity.

$5.3 -$ No Performance History

As the Proposed Manager was incorporated in September 2003, no history of performance in providing management services is available. The Company was incorporated in September 2003 and has no performance history.

The Manager's investment strategy is outlined in Section 2.

Past performance of the funds managed by MMC or HGL will not necessarily reflect future performance of the funds, HGL or the Company. While the investment criteria adopted by MMC and HGL may be similar in some respects to that proposed for the Company, there can be no guarantee that any similarity will continue or that the performance of the Company will be similar to the historic performance of MMC or HGL.

5.4 Key Personnel of the Manager

The Manager will have the benefit of the services of Erik Metanomski and Peter Constable from MMC and Kevin Eley and David Sutherland from HGL who are responsible for making investment decisions.

Details for Erik Metanomski and Peter Constable can be found at Section 3.2, and for Kevin Eley and David Sutherland at Section 4.2.

5.5 Board participation in management

Under the management agreements, the Manager has discretion to acquire and dispose of investments on behalf of the Company. Investments consistent with the investment strategy outlined in Sections 2-4 may be undertaken without consultation with the Board.

Any proposed investment that does not fall within this investment strategy or any change in the investment strategy proposed by the Manager requires the prior approval of the Board which may be withheld in its absolute discretion.

leten

6. FINANCIAL INFORMATION

$6.1$ Pro Forma Statements of Financial Position

The pro forma Statements of Financial Position set out below have been prepared to illustrate the financial position of the Company following completion of the Issue on the basis of preparation and the assumptions set out below.

	PRO FORMA STATEMENTS OF FINANCIAL POSITION
	MinimumSubscription	$75 millionSubscription	MaximumSubscription
AssetsCash	24,313,150	73,382,304	147000,343
Liabilities
Net Assets	24,313,150	73,382,304	147,000,343
Equity	24,313,150	73,382,304	147000,343
NTA per share	973 cents	978 cents	98.0 cents

PROFORMA CASH POSITION

	MinimumSubscription	$75 millionSubscription	MaximumSubscription
Initial issue subscriber
Proceeds of Prospectus Offer	25,000,000	75,000,000	150,000,000
Expenses of Offer(Refer to Section 11.13)	(686, 851)	(1,617697)	(2,999,658)
Estimated Net Cash Position	24,313,150	73,382,304	147,000,343

Basis of preparation

The pro forma Statements of Financial Position have been prepared in accordance with the recognition and measurement principles of Accounting Standards and other mandatory professional reporting requirements in Australia and on the basis of the following assumptions:

$1_{-}$ In the pro forma Statement of Financial Position entitled "Minimum Subscription", reference is to subscription of 25,000,000 Shares by Applicants under this Prospectus.
1. In the pro forma Statement of Financial Position entitled "$75 million Subscription", reference is to subscription of 75,000,000 Shares by Applicants under this Prospectus.
In the pro forma Statement of Financial Position entitled "Maximum Subscription", reference is to 3. subscription of 150,000,000 Shares by Applicants under this Prospectus.
1. Initial expenses relating to the Issue include a handling fee and commission of up to 2% of the funds raised. Bell Potter will be paid a 0.5% handling fee on all subscriptions, and an Applicant's dealer will be paid a 1.5% commission. On Priority Applications Bell Potter will be paid a handling fee of 0.5% only. For the purpose of the above pro forma Statements of Financial Position, it has been assumed that handling fees and commission totalling 2% will be paid on non-priority applications in respect of Shares issued and handing fees of 0.5% on Priority Applications. See Section 11.13 for details.
1. Expenses of the Offer have been paid and recognised as a reduction to the proceeds of equity instruments to which the costs relate.

Hel

6.2 Proposed Accounting Policies and Notes to Accounts

A summary of significant accounting policies which will be adopted and applied in preparation of the financial statement of the Company for the year ending 30 June 2004 and subsequent years is set out below.

$\bf(1)$ Basis of preparation of accounts

The financial statements are a general purpose financial report that have been prepared in accordance with applicable Accounting Standards and other mandatory professional reporting requirements (Urgent Issues Group Consensus Views) and the Corporations Act 2001. The Statements are prepared from the records of the Company on an accruals basis. They are based on historical costs and do not take into account changing money values or, except where specifically stated, current valuation of non-current assets.

$(2)$ Investments

ASX listed shares and securities are valued at market value as quoted on the ASX less an allowance for realisation costs. Non ASX listed shares and securities are valued at their estimated market value less an allowance for realisation costs. Investments including shares and securities are valued continuously and for this reason, cost of sales equals sales revenues when investments are sold. Revaluations are credited directly to the Asset Revaluation Reserve after deducting a provision for potential deferred capital gains tax. When shares, securities and other investments are disposed of, the balance in the Asset Revaluation Reserve related to the disposed share, Security or other investment is transferred to the Capital Profits Reserve.

$(3)$ Investment income

Dividend Income

Dividend income is recognised on a receivable basis on the date shares are quoted ex-dividend.

Distribution Income

Distribution income is recognised on a receivable basis as of the date the unit value is quoted ex-distribution.

Interest income

Interest from fixed interest and discount securities is recognised as income on the basis of the accumulated entitlement that would be received on the disposal of the security according to the trading practices accepted by the market for the relevant security. Interest on cash on deposit is recognised in accordance with the terms and conditions which apply to the deposit.

6.3 Income Tax

It is intended that the Company will be established as a LIC as defined in Subdivision 115-D of the Income Tax Assessment Act 1997 (Cth.), and that the activities of the Company will be such that it will continue to satisfy the requirements of being a LIC.

As a result of being a LIC, tax concessions should be available to investors in the Company that are individuals, trusts, partnerships, complying superannuation funds and certain eligible life insurance companies. Broadly, the tax concessions are intended to allow the benefit of the discount capital gains tax regime to "flow through" to investors in the Company in a similar way that would be available if the Company had been established in a trust structure. This concession may be available where capital gains are made by the Company and are passed on to investors by way of dividends. The Tax Opinion included in this Prospectus at Section 10 provides more detail of this tax concession.

In order for the Company to be treated as a LIC for tax purposes, a number of requirements detailed in the tax law must be satisfied. Broadly, the Company must:

be an Australian resident company:
be listed for quotation on the Australian Stock Exchange or other stock exchange approved by the Corporations Act 2001; and
have at least 90% of the market value of its capital gains tax assets being permitted investments, such as shares, options, units, financial instruments and certain asset types which have the main use of deriving passive income such as interest, annuities, rent, royalties or foreign exchange gains.

Broadly for ownership interests to be permitted investments of the Company the Company must not, directly or indirectly, own more than 10% of the investee company or trust.

In the event that the Company does not continue to satisfy these requirements, other than where there is a temporary breach of the 90% permitted investment requirement that is outside of the control of the Company, the Company will cease to be an LIC for tax purposes.

The tax concessions detailed in the Tax Opinion will not be available in respect of gains made by the Company after it has ceased to be an LIC.

$6.4$ Dividend Policy

The Company will, to the extent it is prudent, pay dividends from profit, dividend and interest income it receives from its investments. Where possible, taxation benefits from profits earned as described in Section 6.3 will be passed on to investors as dividends. Dividends will be franked to the extent that available franking credits permit. The Company intends to pay dividends twice a year provided sufficient profits are available for distribution.

$\mathcal{I}$ DIRECTORS

71 Chairman - Simon Rowell BA (Hons), CA, FAICD

Simon Rowell is an experienced businessman who has been a director of public listed companies for many years and is currently Chairman of Green's Foods Limited, a diversified food manufacturer. He is the former Managing Director of Snack Foods Ltd, Australia's 2nd largest salty snack manufacturer with brands including Thins, CC's and Cheezels. Snack Foods was listed on the Australian Stock Exchange before being acquired in a friendly takeover by Arnott's Biscuits Ltd in 2002 for more than $250 million. Prior to Snack Foods Simon spent 5 years with PricewaterhouseCoopers in Melbourne and 12 years as General Manager of the Jack Chia Group, a diversified business encompassing construction, food, engineering, textiles, and finance and group companies including AVJennings Homes, Long Homes, Dollar Sweets and Players Biscuits.

Simon is a Chartered Accountant, has an honours degree in Arts and is a Fellow of the Australian Institute of Company Directors.

Simon is a non-executive director of the Company and his involvement with the Company will be limited to attending Board meetings of the Company, expected to be held each month, and to providing strategic advice and assistance to the Board from time to time. The Board anticipates that the average time to be made available by Simon Rowell to the affairs of the Company each month should not exceed 10 hours per month.

ECC

$7.2$ Erik Metanomski

Details for Erik Metanomski can be found at Section 3.2.

Erik will be available to manage the affairs of the Company and the Manager subject to his duties as joint chief investment officer and director of MMC.

73 Kevin Eley

Details for Kevin Eley can be found at Section 4.2.

Kevin will be available to manage the affairs of the Company and the Manager subject to his duties as chief executive officer of HGL.

$7.4$ Corporate Governance

The Board has the responsibility of ensuring the Company is properly managed so as to protect and enhance Shareholders' interests in a manner that is consistent with the Company's responsibility to meet its obligations to all parties with which it interacts. To this end, the Board has adopted what it believes to be appropriate corporate governance policies and practices having regard to its size and nature of activities.

The Company will not satisfy the best practice recommendations set by the ASX Corporate Governance Council as independent directors will not constitute a majority of the members of the board or the audit committee. However the Company considers that as the principal management function associated with management of the Portfolio resides with the Manager, the participation of one independent director is appropriate for the Company. The Board will reconsider the composition of the Board in light of, among other things, the inclusion of the Company in the S&P All Ordinaries Index, and in any event prior to the end of the next financial year.

The main corporate governance policies are summarised below.

Appointment and Retirement of Non-Executive Directors

It is the Board's policy to determine the terms and conditions relating to the appointment and retirement of Non-Executive Directors on a case by case basis and in conformity with the requirements of the Listing Rules and the Corporations Act.

Directors' Access to Independent Professional Advice

It is the Board's policy that any committees established by the Board should:

Be entitled to obtain independent professional or other advice at the cost of the Company, unless the Board determines otherwise
Be entitled to obtain such resources and information from the Company including direct access to employees of and advisers to the Company as they might require.
Operate in accordance with terms of reference established by the Board.

Audit Committee

The members of the audit committee are Simon Rowell and Kevin Eley who contribute a broad range of relevant expertise and experience. The committee intends to meet with the external auditors at least three times a year.

This committee addresses the financial and compliance oversight responsibilities of the Board. Specific activities include assessing and monitoring:

the adequacy of the Company's internal controls and procedures to ensure compliance with all applicable legal obligations.
the adequacy of the financial risk management processes.
the appointment of the external auditor, any reports prepared by the external auditor and liaising with the external auditor.

Remuneration

The initial maximum total remuneration of the directors of the Company has been set at $75,000. The remuneration for Directors will be reviewed by the Board on a periodic basis as the Company develops its business.

RISK FACTORS 8.

General Risk Factors $8.1$

The following matters, as well as others described elsewhere in this Prospectus, should be carefully considered in evaluating the Company and its prospects:

the success and profitability of the Company in part will depend upon the ability of the Manager $(a)$ to invest in well-managed companies which have the ability to increase in value over time;
$(b)$ the future earnings of the Company and the value of the investments of the Company may be affected by the general economic climate, commodity prices, currency movements, changing government policy and other factors beyond the control of the Company. As a result, no guarantee can be given in respect of the future earnings of the Company or the earnings and capital appreciation of the Company's investments;
$\overline{c}$ variations in legislation and government policies generally could materially affect operating results of the Company;
$(d)$ any variation in the taxation laws of Australia could materially affect the operating results of the Company;
$(e)$ the price of investments that the Company has purchased can fall as well as rise;
⊕ the past performance of funds managed by the persons associated with the Manager are not necessarily a guide to future performance of the Company;
the selling or purchasing of an unhedged option or warrant runs the risk of losing the entire (g) investment or of causing significant losses to the Company in a relatively short period of time;

Hei

$(h)$ the performance fee may create an incentive for the Manager to make investments on behalf of the Company that are riskier or more speculative than would be the case in the absence of a fee based on the performance of the Company;
the Portfolio is expected to be less diversified than some other listed investment companies; $\langle \mathbf{i} \rangle$
$\bigcirc$ the price at which Shares are traded on ASX may be below the net asset backing of those Shares. The constitution of the Company does not entitle Shareholders to require the Board to implement a share buy-back or any other capital reconstruction or to take any other remedial action;
(k) operational costs for the Company as a proportion of total assets will be affected by the level of total assets of the Company and by the level of acceptance of this Offer. Operational costs will represent a greater proportion of total assets and may reduce the operating results of the Company and accordingly the ability to make dividend payments, if the Company only achieves the minimum subscription under this Offer than if it secures a greater level of acceptance;
$\langle \rangle$ the size of the Portfolio will affect the risk profile of the Portfolio. The Company may not be able to diversify its investments and so manage its risks as efficiently if it achieves the minimum subscription under this Offer than if it secures a greater level of acceptance. However, the risk of loss of investments included in the Portfolio will not necessarily be reduced if the level of acceptance under this Offer exceeds the minimum subscription. Effective risk management depends on a range of factors including diversification of investments and other factors;
the ability of the Manager to continue to manage the Portfolio in accordance with this Prospectus $(m)$ and the Corporations Act is dependent on the maintenance of the Manager's AFSL and its continued solvency. Maintenance of the AFSL depends, among other things, on the Manager continuing to comply with the ASIC imposed licence conditions and the Corporations Act; and
$(n)$ investors are strongly advised to regard any investment in the Company as a long term proposition and to be aware that, as with any equity investment, substantial fluctuations in the value of their investment may occur.

This list is not exhaustive and potential investors should read this Prospectus in full and, if they require further information on material risks, seek professional advice.

8.2 Investor Considerations

Before deciding to subscribe for Shares and Options, Applicants should consider whether Shares and Options are a suitable investment. There are general risks associated with any investment in the stock market. The value of Shares listed on the ASX may rise or fall depending on a range of factors beyond the control of the Company.

There may be tax implications arising from the application for Shares and Options, the receipt of dividends (both franked and unfranked) from the Company, participation in the dividend re-investment plan of the Company, participation in any on market share buy-back and on the disposal of Shares and Options. Applicants should carefully consider these tax implications and obtain advice from an accountant or other professional tax adviser in relation to the application of tax legislation.

If you are in doubt as to whether you should subscribe for Shares and Options, you should seek advice on the matters contained in this Prospectus from a stockbroker, solicitor, accountant or other professional adviser immediately.

8.3 Tax Considerations

Breach of LIC Requirements

In order for the Company to be a LIC for tax purposes, the Company must meet the requirements detailed in Section 6.3 of this Prospectus. In the event that any of these requirements are breached the Company will cease to be an LIC for purposes of the Tax Law, unless it was a breach of the 90% permitted investment requirement that occurred as a result of circumstances over which the Company had no control.

In the event that the Company ceased to be an LIC for tax purposes, the concessional tax treatment should still be available to investors in respect of LIC capital gains made prior to the breach of the LIC requirements that are passed out by way of dividend subsequent to the breach. Any capital gains made while the Company does not satisfy the LIC requirements would not be eligible for the concessional tax treatment to Shareholders.

In the event that subsequent to breaching the LIC requirements the Company again satisfied the requirements detailed in Section 6.3, for example if it sold sufficient non-permitted investments so that it satisfied the 90% permitted investment requirement, it would again become an LIC for tax purposes. However, investments acquired prior to the day it again qualifies as an LIC including investments that were acquired when the company was previously an LIC would not be eligible for the concessional tax treatment to Shareholders.

Holding Shares as Trading Stock

The proposed investment profile of the Company is not that of a share trader, but rather to hold shares for dividend flows and longer term growth.

It is however possible that the Company may acquire one or more investments with a view to profit through short term trading. In this event, the relevant investment would still qualify as a permitted investment, but as any profit on disposal would be treated as ordinary assessable income of the company and the LIC tax concessions would therefore not be available as the tax concessions apply only to capital gains.

In circumstances where the Company begins to regularly hold investments for the purpose of short term profit there is a risk that the Company could become treated as a share trader for tax purposes. Details of all tax consequences likely to arise in this instance are not outlined in this Prospectus, and potential investors should obtain their own tax advice. It is however noted that gains on the sale of all investments could be classified as revenue gains with no LIC tax concessions available to Shareholders.

Deloitte Corporate Finance Pty Limited A.B.N. 19 003 833 127

Grosvenor Place 225 George Street Sydney NSW 2000 PO Box N250 Grosvenor Place Sydney NSW 1217 Australia

0X10307SSE Tel: +61 (2) 9322-7000Fax: +61 (2) 9322-7001 www.delokte.com.au

Deloitte Touche Tohmatsu

INDEPENDENT ACCOUNTANT'S REPORT 9.

10 October 2003

The Directors MMC Contrarian Limited Level 5, 34 Hunter Street Sydney NSW 2000

Dear Directors

REVIEW OF DIRECTORS' PRO FORMA STATEMENTS OF FINANCIAL POSITION

1. Introduction

This report has been prepared at the request of the Directors of MMC Contrarian Limited ("the Company"), for inclusion in a Prospectus to be issued by the Company in respect of the offer of a minimum of 25 million, and up to a maximum of 150 million, Shares priced at $1.00 each. The issue price will be payable by 15 December 2003. An Option, with a strike price of $1.00, will be issued for every Share issued. Expressions defined in the Prospectus have the same meaning in this report.

Deloitte Corporate Finance Pty Limited is wholly owned by Deloitte Touche Tohmatsu and holds the appropriate dealer's licence for the issue of this report. References to the Company and other terminology used in this report have the same meaning as defined in the Glossary in Section 12 of the Prospectus.

Background $2.$

The Company was incorporated on 9 September 2003 with 1 Share of $1.00 and has not traded or issued shares since incorporation. The Company intends to invest the proceeds derived from the issue of the shares predominately in securities quoted on the ASX, bills of exchange, other negotiable instruments and other investments.

3. Scope

You have requested that Deloitte Corporate Finance Pty Limited prepare a report covering the Pro forma Statements of Financial Position as set out in section 6.1 of the Prospectus, which assumes the completion of the contemplated capital raising.

The liability of Defoitte Touche Tohmatsu, is limited by, and to the extent of, the Accountants' Scheme under the Professional Standards Act 1994 (NSW).

4. Financial Information

The Directors of the Company ("the Directors") are responsible for the preparation and presentation of the Pro forma Statements of Financial Position as at Allotment as set out in Section 6.1 of the Prospectus and the information contained therein, including the assumptions on which they are based.

The Pro forma Statements of Financial Position as set out in Section 6.1 of the Prospectus represent the profforma financial position of the Company as at Allotment after the costs of preparing the Prospectus. The Pro forma Statements of Financial Position have been prepared in accordance with the recognition and measurement principles of Accounting Standards and other mandatory professional reporting requirements in Australia and on the assumption that the transactions contemplated on or around Allotment in the Prospectus are completed as at Allotment.

5. Review of the Pro forma Statements of Financial Position

We have conducted a review of the Pro forma Statements of Financial Position as set out in Section 6.1 of the Prospectus in order to state whether, on the basis of the procedures described, anything has come to our attention that would indicate that the Pro forma Statements of Financial Position are not presented fairly in accordance with the basis of preparation as set out in Section 6.1 of the Prospectus.

Our review has been conducted in accordance with Australian Auditing Standards applicable to review engagements. The review was limited primarily to enquiries of and discussions with management and the Directors and the Company's advisers as well as examination of the documentation relating to the transactions contemplated in the Prospectus.

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.

6. Statement on the Pro forma Statements of Financial Position

Based on our review, which is not an audit, nothing has come to our attention which causes us to believe that the Pro forma Statements of Financial Position set out in Section 6.1 of the Prospectus do not present fairly the Pro forma Statements of Financial Position of the Company as at the date of Allotment in accordance with the basis of preparation as disclosed in Section 6.1 of the Prospectus.

7. Independence

Deloitte Touche Tohmatsu and Deloitte Corporate Pinance Pty Limited do not have any interest in the outcome of this issue other than for the preparation of this report and the tax opinion in Section 10 for which normal professional fees will be received.

Yours faithfully DELOITTE CORPORATE FINANCE PTY LIMITED

I leacher

Ian Thatcher Director

Deloitte Touche Tohmatsu Ltd A.B N. 41 092 223 240 A.C.N. 092 223 240

Grosvenor Place 225 George Street Sydney NSW 2000 PO Box N250 Grosvenor Place Sydney NSW 1217 Australia

DX 103075SE Telephone: (02) 9322 7000 Facsimile: (02) 9322 7001 www.deloitte.com.au

Deloitte Touche Tohmatcu

10. Taxation Opinion

10 October 2003

The Directors MMC Contrarian Limited Level 5, 34 Hunter Street SYDNEY 2000

Dear Sirs

We have been engaged to provide a report on the income tax issues which may affect investors in MMC Contrarian Limited ("the Company") for inclusion in the Company's Prospectus dated 10 October 2003.

This opinion is intended to provide a general overview of the likely income tax consequences for investors arising from their investment in ordinary shares in the Company. As the individual circumstances of all investors may affect the way they are taxed we recommend that each potential investor should seek their own tax advice before considering an investment in the Company.

Our comments have been based on the tax laws as in force at the date of this letter as contained in the Income Tax Assessment Act 1936, Income Tax Assessment Act 1997 and Income Tax Rates Act 1986 (collectively referred to as the "Tax Law").

This opinion is provided on the basis that the Company will be listed investment company ("LIC") in accordance with Subdivision 115-D of the Tax Law at the time shares are issued under the Prospectus and that the Company will adhere to the requirements detailed in the Tax Law in order to continue as a LIC.

Treatment of income derived from the Company

The main income and profits likely to be derived by investors in relation to their investment in the Company are:

Dividends; and
Gains on disposal of their shares

The following is a brief discussion of the likely tax implications of investors deriving each of these amounts.

Dividends

Dividends received by Australian resident shareholders should be included in their ordinary assessable income. Where shares in the Company are held by trusts or partnerships, the dividend income should "flow through" to the beneficiaries and be included in their ordinary assessable income.

To the extent that dividends have been franked, the attached imputation credits should also be included in the investors' assessable income, with an offset available in respect of the imputation credits. This treatment will also apply where the dividend income "flows" through" a trust or partnership.

Note that restrictions on the availability of imputation credits may apply for company shareholders (whether their shares in the Company are held directly or indirectly through a trust or partnership) where their shares in the Company have not been held "at risk1" for at least 45 days.

Foreign shareholders may be subject to withholding tax (generally $15%$ ) in respect of any unfranked dividends paid by the Company.

Dividends including an LIC capital gain

The Tax Law provides for a capital gains tax discount ("CGT Discount") where "Eligible Investors" as defined in the Tax Law (generally being individuals, trusts and complying superannuation funds) derive a capital gain in respect of a post-CGT asset that has been held for at least 12 months and where certain other requirements as set out in the Tax Law are also satisfied. The discount percentage is 50% for individuals and trusts, and 33%% for complying superannuation funds.

As the Company is a company, the CGT Discount will not be available to the Company in respect of any capital gains derived. Rather, net capital gains made by the Company will be subject to tax at corporate rate of tax (currently 30%). However, as the Company is an LIC, a benefit effectively equivalent to the CGT Discount may be available to those shareholders in the Company that are Eligible Investors where the capital gain is passed on to investors as a dividend.

In elaboration, where the Company derives a capital gain in respect of a post-CGT asset which had been held for 12 months or more and the capital gain would have satisfied the other requirements of being eligible for the CGT Discount if it had been made by an Eligible Investor, the capital gain is referred to as an "LIC Capital Gain".

The Company will retain records showing the balance of its LIC Capital Gains available for distribution. Where a dividend is paid by the Company which includes LIC Capital Gains, those investors that are Eligible Investors should be entitled to a tax deduction for a portion of the "attributable part" of the dividend that they receive.

$1$ As defined in the Tax Law.

Broadly, the attributable part of the dividend is the pre-tax LIC Capital Gains included in the dividend. Individuals and trusts are able to obtain a 50% discount on this attributable part, with a 33%% discount available to complying superannuation funds. The Company will advise investors of their proportional share of the attributable part.

Note also that dividends attributable to LIC Capital Gains are capable of being franked and Australian resident shareholders - including Eligible Shareholders able to access the CGT Discount in respect of the attributable part – will continue to obtain the benefit of imputation credits.

Examples

The following example illustrates the benefit of paying a dividend attributable to an LIC Capital Gain for an individual shareholder and for a complying superannuation fund using tax rates applicable at the time of this letter. In this example, the cash dividend of $70 is wholly attributable to an LIC Capital Gain of $100.

Dividend received by an individual

	$
Dividend paid	70.00
Plus imputation credits	30.00
Less: tax deduction allowable under Subdivision 115-D (i.e. 50% of
$100 total dividend)	(50.00)
Net taxable income	$50.00

Income tax at $48.5%$ (maximum individual rate)	24.25
Less imputation credit	(30.00)
Tax Refund	$5.75

Summary
Dividend Received	70.00
Tax Refund	5.75
After-tax value of the dividend	$75.75
Effective tax rate on LIC gain	24.25%


Dividend received by a complying superannuation fund
	$
Dividend paid	70.00
Plus imputation credits	30.00
Less: tax deduction allowable under Subdivision 115-D	(33.33)
Net taxable income	$66.67

Income tax at $15%$ (maximum superannuation fund rate)	10.00
Less imputation credit	(30.00)
Tax Refund	$20.00

Deloite Tanka Tohmatsu

Summary
Dividend Received	70.00
Tax Refund	20.00
After-tax value of the dividend	$90.00
Effective tax rate on LIC gain	10%

Gains on disposal of the shares

In the event that an investor holds their shares in the Company as a capital investment, any gain on disposal of their shares should be subject to tax as a capital gain. If the shareholder is an Eligible Investor and they have held their shares in the Company for at least 12 months, the resulting net capital gain should be reduced by the CGT Discount. Note that the discount percentage for individuals and trusts is 50%, while the discount percentage for complying superannuation funds is 33%%.

In the event that an investor holds their shares in the Company as a revenue asset such as trading stock, any gain resulting from a sale of the shares should be subject to tax as ordinary income at their applicable rate of tax. As such, the CGT Discount provisions would not apply.

Yours sincerely DELOITTE TOUCHE TOHMATSU LIMITED

i de loch

Rick Taylor Director - Deloitte Tax Services

Hei

11. ADDITIONAL INFORMATION

11.1 Balance Date and Company Tax Status

The accounts for the Company will be made up to 30 June annually.

The Company will be taxed as a public company.

11.2 Licensed Dealers

The Company does not hold an Australian Financial Services Licence or a dealers licence. Accordingly, the Company will only issue Shares and Options pursuant to this Prospectus under an arrangement with dealers pursuant to Section 911A(2)(b) of the Corporations Act.

11.3 Rights Attaching to the Shares

Immediately after issue and allotment, the Shares will be fully paid Shares. There will be no liability on the part of shareholders for any calls and the Shares will rank pari passu with Shares currently on issue.

Detailed provisions relating to the rights attaching to the Shares are set out in the Company's constitution and the Corporations Act. A copy of the constitution can be inspected during office hours at the registered office of the Company.

The detailed provisions relating to the rights attaching to Shares under the constitution and the Corporations Act are summarised below:

Each Share will confer on its holder:

$(a)$ The right to vote at a general meeting of shareholders (whether present in person or by any representative, proxy or attorney) on a show of hands (one vote per shareholder) and on a poll (one vote per Share on which there is no money due and payable) subject to the rights and restrictions on voting which may attach to or be imposed on Shares (at present there are none);
The right to receive dividends, according to the amount paid up on the Share; $(b)$
$(c)$ The right to receive, in kind, the whole or any part of the Company's property in a winding up, subject to the rights of a liquidator to distribute the surplus assets of the Company with the consent of members by special resolution.

Subject to the Corporations Act and the Listing Rules, Shares are fully transferable.

The rights attaching to Shares may be varied with the approval of shareholders in general meeting by special resolution.

11.4 Rights Attaching to the Options

The terms and conditions of the Options are as follows:

The Company will maintain a register of holders of Options in accordance with Section $168(1)(b)$ of the Corporations Act.

Transfer/Transmission

An Option may be transferred or transmitted in any manner approved by the Australian Stock Exchange Limited.

Exercise

An Option may be exercised by delivery to the Company of a duly completed Notice of Exercise of Options, signed by the registered holder of the Option, together with payment to the Company of $1.00 per Option being exercised and the relevant option certificate.

An Option may be exercised on any business day from the date of grant to 30 June 2005, (inclusive) but not thereafter.

A Notice of Exercise of Options is only effective when the Company has received the full amount of the exercise price in cash or cleared funds.

Dividend Entitlement

Options do not carry any dividend entitlement until they are exercised. Shares issued on exercise of Options rank equally with other issued ordinary shares of the Company 7 business days after their date of issue and are entitled to dividends declared on and from this date.

Participating rights

An Option holder may only participate in new issues of securities to holders of Shares in the Company if the Option has been exercised and Shares allotted in respect of the Option before the record date for determining entitlements to the issue. The Company must give at least 7 business days' notice to Option holders of any new issue before the record date for determining entitlements to the issue in accordance with the Listing Rules of the Australian Stock Exchange Limited.

If between the date of issue and the date of exercise of an Option the Company makes one or more rights Issues (being a pro rata issue of Shares in the capital of the Company that is not a bonus issue), the exercise price of Options on issue will be reduced in respect of each rights issue according to the following formula:

$$ NE = OE - E[ P-(S + D)] $$

(N + 1)

where:

NE is the new exercise price of the Option;

OE is the old exercise price of the Option;

is the number of underlying Shares into which one Option is exercisable; E.
P is the average closing sale price pre Share (weighted by reference to volume) during the 5 trading days ending on the day before the ex rights date or ex entitlements date (excluding special crossings and overnight sales);
S is the subscription price for a Share under the rights issue;
D is the dividend due but not yet paid on each Shares at the relevant time; and
is the number of Shares that must be held to entitle holders to receive a new Share in the rights issue. N.

If there is a bonus issue to Shareholders, the number of Shares over which the Option is exercisable will be increased by the number of Shares which the holder of the Option would have received if the Option had been exercised before the record date for the bonus issue.

Hel

Reconstructions and Alteration of Capital

Any adjustment to the number of outstanding Options and the exercise price under a re-organisation of the Company's share capital must be made in accordance with the Listing Rules.

Stock Exchange Listing

The Company must make application for quotation of shares issued on the exercise of the Options on the ASX in accordance with the Listing Rules. Shares so issued will rank equally with other issued Shares of the Company.

11.5 Material Contracts

The Directors consider that the material contracts described below and elsewhere in this Prospectus are the contracts which an investor would reasonably regard as material and which investors and their professional advisers would reasonably expect to find described in this Prospectus for the purpose of making an informed assessment of the Offer.

This report only contains a summary of the material contracts and their substantive terms.

Management Agreement

Parties

The Company and the Proposed Manager.

Appointment

The Company has appointed the Proposed Manager to manage the Portfolio. This appointment commences on the date the Proposed Manager is granted an AFSL with all authorisations necessary to enable the Proposed Manager to perform its portfolio management services on behalf of the Company under the management agreement. If the Proposed Manager is unable to obtain an AFSL by 31 December 2004, the management agreement with the Proposed Manager automatically terminates and management of the Portfolio will remain with MMC.

Powers of Manager

Subject to the Corporations Act and the Listing Rules, the Proposed Manager will from time to time on behalf of the Company invest money constituted in or available to the Portfolio in making, holding realising and disposing of investments.

Provided it continues to manage the Portfolio in accordance with the investment approach outlined in this Prospectus, the Proposed Manager has absolute and unfettered discretion to manage the Portfolio and to do all things considered necessary or desirable in relation to the Portfolio. Any material deviation from the investment approach or strategy outlined in this Prospectus to be undertaken by the Proposed Manager requires the prior approval of the Company.

The powers of the Proposed Manager when managing the Portfolio include:

$(a)$ investigation of, negotiation for, acquisition of, or disposal of every investment;
$(b)$ to sell, realise or deal with all or any of the investments or to vary, convert, exchange or add other investments in lieu of those investments;

Hei

$\langle c \rangle$ if any investments are redeemed or the capital paid on it is wholly or partly repaid by the entity by which that investments was created or issued, to convert that investment into some other investment or accept repayment of the capital paid or advanced on the investment and any other monies payable in connection with that redemption or repayment and to investment any of those monies in investment:
$(d)$ retain or sell any shares, debentures or other property received by the Company by way of bonus, or in lieu of, or in satisfaction of, a dividend in respect of any investments or from the amalgamation or reconstruction of any company; and
$(e)$ to sell all or some of the rights to subscribe for new Securities in an investment, to use all or part of the proceeds of sale of such rights for the subscription for Securities or to subscribe for Securities pursuant to those rights.

Monthly Valuations

The Proposed Manager must arrange for calculation of the value of the Portfolio at least monthly and provide such calculations to the Company as soon as practicable after such calculations are made. All costs incurred by the Proposed Manager in arranging this calculation are to be paid by the Company.

Management Fee

The Proposed Manager will receive a management fee of 1.25% of gross assets per annum calculated monthly.

Performance Fee

The Manager will be entitled to be paid and the Company must pay to the Manager a fee (Performance Fee) in respect of each Performance Calculation Period of 15% of BA where, subject to the following, BA is calculated in accordance with the following formula:

$$ BA = (FV - IV) - (IV \times \frac{(FI - II)}{II}) $$

where

BA is the base amount to be used in calculating the Performance Fee outlined above;

FV is the Value of the Portfolio calculated on the last Business Day of a Performance Calculation Period;
IV is the Value of the Portfolio calculated on the last Business Day of the preceding Performance Calculation Period;
Fl is the level of the All Ordinaries Accumulation Index published by ASX on the last Business Day of that Performance Calculation Period; and
is the All Ordinaries Accumulation Index published by ASX calculated on the last Business Day of the Ш preceding Performance Calculation Period.

If the Value of the Portfolio calculated on the last Business Day of a Performance Calculation Period is less than the Value of the Ponfolio calculated on the last Business Day of the preceding Performance Calculation Period, no Performance Fee is payable in respect of that Performance Calculation Period.

If the amount calculated as BA is a negative number, no Performance Fee is payable in respect of that Performance Calculation Period.

Hel

If the level of the All Ordinaries Accumulation Index as calculated on the last Business Day of a Performance Calculation Period is less than the level as calculated on the last Business Day of the proceeding Performance Calculation Period, BA is the amount determined to be FV - IV.

For the calculation of the performance fee, the Performance Calculation Period is:

$(i)$ if the interim management agreement is terminated by the grant of an AFSL to the Proposed Manager, the first Performance Calculation Period is the period from the end of the last Performance Calculation Period or the commencement date under the interim management agreement to the next 30 June;
$(ii)$ if the interim management agreement is not terminated by the grant of an AFSL to the Proposed Manager, the first Performance Calculation Period is the period from the commencement date of the agreement to the next 30 June;
(前) subject to (iv) below, the period from the first day after the preceding Performance Calculation Period to 30 June of the succeeding year; and
if the Term expires on a day other than 30 June, the last Performance Calculation Period is the period $(iv)$ from the first day after the preceding Performance Calculation Period and the date the agreement is terminated.

Where the ASX or equivalent authority ceases to publish the All Ordinaries Accumulation Index then the published index which most closely resembles it must be used for the purposes of the calculation.

In calculation of the Performance Fee for a Performance Calculation Period, changes in the value of the Portfolio as a result of the issue of Securities by the Company, capital reductions by the Company, share buybacks by the Company and dividend distributions by the Company will be disregarded or adjusted for that Calculation Period in a manner determined by the Auditor of the Company at the conclusion of that Performance Calculation Period.

The Auditor must certify the correct calculation of the Performance Fee prior to payment.

The Company must also pay any GST payable in respect of any Management Fee or Performance Fee due to the Manager.

Expenses

The Company is liable for and must pay out of the Portfolio or reimburse the Proposed Manager the following fees, costs and expenses when properly incurred in connection with the investment and management of the Portfolio or the acquisition, disposal or maintenance of any investment:

fees payable to any securities exchange, the ASIC or other regulatory body; $(a)$
$(b)$ all costs, stamp duties, financial institutions duties, bank account debits tax and legal fees and other duties, taxes, fees, disbursements and expenses, commissions and brokerage incurred by the Company or the Proposed Manager in connection with:
- $\langle \mathbf{j} \rangle$ the acquisition and negotiation of any investment or proposed investment;
- $(i)$ any sale or proposed sale, transfer, exchange, replacement or other dealing or proposed dealing with or disposal or proposed disposal of any investment;
- (iii) the receipt of income or other entitlements from the investments of the Portfolio; or
- the engagement of a custodian to hold any investment on behalf of the Company; and $(iv)$
$\left( \mathrm{c}\right)$ outgoings in relation to the Portfolio such as rates, levies, duties, taxes and insurance premiums.

Notwithstanding the above, the Proposed Manager is solely responsible for payment of the fees of any investment manager engaged by the Proposed Manager to assist it in undertaking its duties under the management agreement.

Term

The Management Agreement is for an initial period of 25 years commencing on the later of the date the Company allots and issues not less than 25,000,000 Shares pursuant to the Offer and the grant of an AFSL to the Proposed Manager with authorisations necessary to enable the Proposed Manager to provide portfolio management services to the Company under the management agreement.

Termination

The Proposed Manager may terminate the management agreement at any time by giving to the Company at least 6 months written notice.

The Company may immediately terminate the management agreement if:

$(a)$ an insolvency event occurs with respect to the Proposed Manager;
$(b)$ the Proposed Manager is in default or breach of its obligations under the agreement in a material respect and such default or breach cannot be rectified or, if rectifiable, is not rectified within 30 days after the Company has notified the Proposed Manager in writing to rectify the default or breach;
$\langle c \rangle$ the Proposed Manager's Australian Financial Services licence is suspended or cancelled at any time in accordance with Subdivision C. Division 4 of Part 7.6 of the Corporations Act;
$\mathbf{d}$ there is a change in control of the Proposed Manager and the Company has not previously granted its prior written consent to the change in control (which must not be unreasonably withheld or delayed);
the Proposed Manager persistently fails to ensure that investments made on behalf of the Company $(e)$ are consistent with the investment strategy applicable at the time the investment is made.

Company Indemnity

The Company must indemnify the Proposed Manager against any losses or liabilities reasonably incurred by the Proposed Manager arising out of, or in connection with, and any costs, charges and expenses (including legal expenses on a solicitor/own client basis) incurred in connection with the Proposed Manager or any of its officers, employees or agents acting under the management agreement or on account of any bona fide investment decision made by the Proposed Manager or its officers or agents except insofar as any loss, liability, cost, charge or expense is caused by the negligence, default, fraud or dishonesty of the Proposed Manager or its officers or employees. This obligation continues after the termination of the management agreement.

Proposed Manager Indemnity

The Proposed Manager must indemnify the Company against any losses or liabilities reasonably incurred by the Company arising out of, or in connection with, and any costs, charges and expenses incurred in connection with, any negligence, default, fraud or dishonesty of the Proposed Manager or its officers or supervised agents. This obligation continues after the termination of the management agreement.

Assignment

The Proposed Manager may assign all right, title and interest in the management agreement to a third party with the prior written consent of the Company which may not be unreasonably withheld or delayed.

Hei

Interim Management Agreement

Parties

The Company and MMC.

Term

The interim management agreement commences on the date the Company allots and issues not less than 25,000,000 Shares and 25,000,000 Options pursuant to the Offer and terminates on the earlier of the date the Proposed Manager receives an AFSL with authorisations necessary to enable it to provide portfolio management services to the Company in accordance with the management agreement and the date 25 years after commencement unless terminated earlier in accordance with its terms. If the Proposed Manager fails to so obtain an AFSL by 31 December 2004, the management agreement with the Proposed Manager terminates and the interim management agreement with MMC continues until the date 25 years after commencement unless terminated earlier in accordance with its terms.

Substantive Terms

Except as set out above, the terms of the interim management agreement are identical to the terms of the management agreement with the Proposed Manager outlined above. If the interim management agreement is terminated due to the grant of an AFSL to the Proposed Manager, no performance fee is payable to MMC for the final performance calculation period. Rather, the fee for that period is payable to the Proposed Manager and not to MMC.

Shareholders' Agreement

Parties

The Proposed Manager, MMC and HGL.

Interim Period

Until the Proposed Manager is granted an AFSL, the management of the Portfolio will be undertaken by MMC. MMC may only perform its duties under the interim management agreement in accordance with the determination of an interim investment committee. Each of HGL and MMC may appoint 2 members to this committee. MMC must appoint the HGL nominees as its authorised representatives and may require them to comply with its reasonable directions and instructions to ensure compliance with applicable law and the terms of its AFSL. MMC must remit 40% of all fees received by MMC under the interim management agreement to HGL on a monthly basis during the term of that interim management agreement.

Each party must use its best endeavours to procure the grant of an AFSL to the Proposed Manager.

Board representation

Each of HGL and MMC may appoint 2 directors to the board of the Proposed Manager. Critical decisions regarding the business of the Proposed Manager may only be made with the approval of all directors or shareholders.

Pre emptive Rights

Each shareholder holds pre-emptive rights over the shares held by the other. No shares may be disposed of to a third party without the shares being first offered to the other shareholder.

Termination and disputes

If an insolvency event occurs with respect to a shareholder or a shareholder breaches a material provision of the agreement and fails to rectify the breach within 20 business days, the rights of the defaulting shareholder may be suspended and the defaulting shareholder's shares may be bought by the remaining shareholder at independent valuation.

Disputes between the parties that may not be resolved by independent determination may be resolved by an offer to buy the shares of the other shareholder. The offered shareholder may accept the offer or reverse it and require the offered shareholder to sell its shares to it at the same price per share.

Deeds of Access and Indemnity

Parties

The Company and each Director.

Access

The Company has agreed to provide access to board papers to current and former officers of the Company while they are officers and for a period of 7 years from when they cease to be officers.

Indemnity

The Company has agreed to indemnify, to the extent permitted by the Corporations Act, each officer in respect of certain liabilities which the officer may incur as a result of, or by reason of (whether solely or in part), being or acting as an officer of the Company. The Company has also agreed to use its reasonable commercial endeavours to maintain in favour of each officer a directors' and officers' policy of insurance for the period that they are an officer and for a period of 7 years after the officer ceases to be officers.

11.6 ASX Waivers

The Company has obtained advice from ASX that ASX would be likely to grant the Company a waiver of Listing Rule 15.16 to the extent necessary to allow both MMC and the Proposed Manager to act as the investment manager of the Company's Portfolio in accordance with the interim management agreement and the management agreement for a 25 year term from the date of admission of the Company to the official list of ASX.

11.7 Dividend Re-Investment Plan

The Company has established a dividend re-investment plan (Plan). The Plan may be applied to dividends paid from time to time. The Board reserves the right to obtain underwriting for the issue of Shares pursuant to the Plan.

The substantive provisions of the Plan are summarised below.

Eligible Members

Shareholders who may participate in the Plan comprise Shareholders:

whose address, as it appears in the register of members of the Company, is situated in Australia; or (a)
$(b)$ whose address, as it appears in the register of members of the Company, is situated outside Australia and who have produced to the Company such evidence as the Company may require to satisfy the Company that any necessary approvals of any governmental authority in relation to participation in the Plan have been obtained and that such participation is not contrary to any applicable laws of Australia or any other relevant jurisdiction.

ECC

Application

Eligible Members may elect to participate in the Plan in respect of all or part of their Shares in the Company which will comprise that member's Plan Shares. The Directors may in their absolute discretion accept or refuse any application to participate.

Subscription Price

Shares allotted to participants will be allotted at the weighted average market price of Shares sold on the ASX on the books closing date for the relevant dividend and the 3 trading days preceding that date. The Board may discount the issue price by up to 5%.

Investment of Dividends

In respect of each cash dividend from time to time due and payable to a participant in respect of the member's Plan Shares, the Directors will on behalf of and in the name of the participant subscribe for Shares being the maximum number of Shares which could be acquired by subscription by the application of that participant's entitlement to dividends in respect of the Plan Shares to the subscription for Shares at the subscription price.

Ranking of Shares

All Shares allotted and issued under the Plan will rank equally in all respects with existing Shares.

ASX Listing

The Company will make application promptly after each allotment of Shares for quotation of such Shares on the official list of the ASX.

Variation or Termination of Participation

A participant may apply to increase or decrease the number of Plan Shares which the Company may in its absolute discretion approve or refuse. A participant may at any time terminate participation in the Plan by notice in writing to the Company.

11.8 Matters Relevant to the Directors

None of the Directors have an interest in the Securities of the Company.

Except as set out in this Prospectus (including in Sections 11.9 and 11.10), there are no interests that exist at the date of this Prospectus and there were no interests that existed within 2 years before the date of this Prospectus that are or were, interests of a Director or a proposed Director in the promotion of the Company or in any property proposed to be acquired by the Company in connection with its formation or promotion.

Further, except as set out in this Prospectus, there have been no amounts paid or agreed to be paid to a Director in cash or Securities or otherwise by any persons either to induce him to become or qualify him as a Director or otherwise for services rendered by him in connection with the promotion or formation of the Company.

Kevin Eley, his nominees or associates will subscribe for Shares and Options of $100,000 in the context of the Offer. Erik Metanomski, his nominees or associates will subscribe for Shares and Options of $100,000 in the context of the Offer. Simon Rowell, his nominees or associates will subscribe for Shares and Options of $50,000 in the context of the Offer.

11.9 Remuneration of Directors

Under the Company's constitution, each Director (other than a Managing Director or an Executive Director) may be paid out remuneration for ordinary services performed as a Director.

Under the ASX Listing Rules the maximum fees payable to directors may not be increased without prior approval from the Company at a general meeting. Directors will seek approval from time to time as deemed appropriate.

The maximum total remuneration of the directors of the Company has been set at $75,000 per annum to be divided among them in such proportions as they agree.

11.10 Related Party Transactions

As at the date of this Prospectus, the Company is a party to the following transactions with related parties and future related parties:

$(a)$ The Company has entered into an interim management agreement with MMC. MMC will receive fees in connection with the provision of services under this agreement. See Section 11.5 for details. Erik Metanomski is a director of the Company and MMC. Kevin Eley is a director of the Company and MMC.
$(b)$ The Company has entered into a management agreement with the Proposed Manager. The Proposed Manager will receive fees in connection with the provision of services under this agreement. See Section 11.5 for details The Proposed Manager is owned by MMC and HGL. Erik Metanomski is a director of the Company, the Proposed Manager and MMC. Kevin Eley is a director of the Company, the Proposed Manager, MMC and HGL.
${c}$ Each Director has entered into a deed of access and indemnity with the Company. See Section 11.5 for details.
$(d)$ HGL has paid the costs of incorporation of the Company and of the preparation of the Prospectus on behalf of the Company and will be reimbursed by the Company out of the proceeds of the Offer.

11.11 Legal Proceedings

The Company is not and has not been, during the 12 months preceding the date of this Prospectus, involved in any legal or arbitration proceedings which have had a significant effect on the financial position on the Company. As far as the Directors are aware, no such proceedings are threatened against the Company.

11.12 Consents and Responsibility Statements

Watson Mangioni has given and before lodgement of the paper Prospectus with ASIC and the issue of the Electronic Prospectus has not withdrawn its written consent to be named as solicitors to the Offer in the form and context in which it is so named.

Watson Mangioni has only been involved in the preparation of that part of the Prospectus where they are named as solicitors to the Offer. Watson Mangioni specifically disclaims liability to any person in the event of any omission from, or any misleading or deceptive statement included elsewhere in this Prospectus. While Watson Mangioni has provided advice to the Directors in relation to the issue of the Prospectus and the conduct of due diligence enquiries by the Company and the Directors, Watson Mangioni has not authorised or caused the issue of the Prospectus and takes no responsibility for its contents.

Hel

Deloitte Corporate Finance Pty Limited has given and before lodgement of the paper Prospectus with ASIC and the issue of the Electronic Prospectus has not withdrawn its written consent to being named in the Prospectus as independent accountant of the Company in the form and context in which it so named and the inclusion of its Investigating Accountant's report in the form and context in which it appears.

Deloitte Corporate Finance Pty Limited has not been involved in the preparation of any part of this Prospectus and specifically disclaims liability to any person in the event of omission from, or a misleading or deceptive statement included in the Prospectus. Deloitte Corporate Finance Pty Limited has not authorised or caused the issue of this Prospectus and takes no responsibility for its contents.

Deloitte Touche Tohmatsu has given and before lodgement of the paper Prospectus with ASIC and the issue of the Electronic Prospectus has not withdrawn its written consent to being named in the Prospectus as auditor of the Company in the form and context in which it so named.

Deloitte Touche Tohmatsu has not been involved in the preparation of any part of this Prospectus and specifically disclaims liability to any person in the event of omission from, or a misleading or deceptive statement included in the Prospectus. Deloitte Touche Tohmatsu has not authorised or caused the issue of this Prospectus and takes no responsibility for its contents.

Deloitte Touche Tohmatsu Limited has given and before lodgement of the paper Prospectus with ASIC and the issue of the Electronic Prospectus has not withdrawn its written consent to being named in the Prospectus as tax advisor of the Company in the form and context in which it so named and the inclusion of its Tax report in the form and context in which it appears.

Deloitte Touche Tohmatsu Limited has not been involved in the preparation of any part of this Prospectus and specifically disclaims liability to any person in the event of omission from, or a misleading or deceptive statement included in the Prospectus. Deloitte Touche Tohmatsu Limited has not authorised or caused the issue of this Prospectus and takes no responsibility for its contents.

M&GIC Pty Limited has given and before lodgement of the paper Prospectus with ASIC and the issue of the Electronic Prospectus has not withdrawn its written consent to being named in the Prospectus as proposed manager of the Company in the form and context in which it so named.

M&GIC Pty Limited has not been involved in the preparation of any part of this Prospectus and specifically disclaims liability to any person in the event of omission from, or a misleading or deceptive statement included in the Prospectus. M&GIC Pty Limited has not authorised or caused the issue of this Prospectus and takes no responsibility for its contents.

MMC Asset Management Limited has given and before lodgement of the paper Prospectus with ASIC and the issue of the Electronic Prospectus has not withdrawn its written consent to being named in the Prospectus as interim manager of the Company in the form and context in which it so named.

MMC Asset Management Limited has not been involved in the preparation of any part of this Prospectus and specifically disclaims liability to any person in the event of omission from, or a misleading or deceptive statement included in the Prospectus. MMC Asset Management Limited has not authorised or caused the issue of this Prospectus and takes no responsibility for its contents.

Computershare Investor Services Pty Limited has given and before lodgement of the paper Prospectus with ASIC and the issue of the Electronic Prospectus has not withdrawn its written consent to being named in the prospectus as share registrar for the Company in the form and context in which it so named.

Computershare Investor Services Pty Limited has not been involved in the preparation of any part of this Prospectus and specifically disclaims liability to any person in the event of omission from, or a misleading or deceptive statement included in the Prospectus. Computershare Investor Services Pty Limited has not authorised or caused the issue of this Prospectus and takes no responsibility for its contents.

Bell Potter Securities Limited has given and before lodgement of the paper Prospectus with ASIC and the issue of the Electronic Prospectus has not withdrawn its written consent to being named in the Prospectus as sponsoring broker to the Offer in the form and context in which it so named.

Bell Potter Securities Limited has not been involved in the preparation of any part of this Prospectus and specifically disclaims liability to any person in the event of omission from, or a misleading or deceptive statement included in the Prospectus. Bell Potter Securities Limited has not authorised or caused the issue of this Prospectus and takes no responsibility for its contents.

11.13 Interest of Experts

Other than as set out below, no expert nor any firm in which such expert is a partner or employee has any interest in the promotion of or any property proposed to be acquired by the Company.

The anticipated costs of the Offer on the basis that subscription for 25,000,000, 75,000,000 and 150,000,000 Shares and Options are set out below:

	MinimumSubscription	$75 millionSubscription	MaximumSubscription
Handling Fees	(450,000)	(1,350,000)	(2,700,000)
ASX Listing Fees	(64, 841)	(95,687)	(127,648)
ASIC Fees	(2,010)	(2,010)	(2,010)
Legal and Accounting	(100,000)	(100,000)	(100,000)
Other Costs	(70,000)	(70.000)	(70,000)
Total Fees	(686, 851)	(1,617,697)	(2,999,658)
Handling Fees	MinimumSubscription	$75 millionSubscription	MaximumSubscription
PriorityNon-Priority	(16,667)(433,333)	(50,000)(1,300,000)	(100,000)(2,600,000)
Total Handling Fees and commissions	(450,000)	(1,350,000)	(2,700,000)

Ekat

Watson Mangioni have acted as solicitors to the Offer and have performed work in relation to negotiating certain of the material contracts, preparing the due diligence program and performing due diligence enquiries on legal matters. In respect of this Prospectus, the Company estimates that it will pay amounts totalling approximately $60,000 (excluding disbursements) to Watson Mangioni.

Deloitte Corporate Finance Pty Limited has prepared the independent accountant's report included in this Prospectus and have also performed work in relation to the due diligence enquiries on financial matters. In respect of this work, the Company estimates that it will pay up to $12,000 (excluding disbursements) to Deloitte Touche Tohmatsu.

Deloitte Touche Tohmatsu Limited has also prepared the Taxation Report included in this Prospectus and has acted as auditor of the Company. In respect of this work, the Company estimates it will pay up to $3,000 (excluding disbursements) to Deloitte Touche Tohmatsu.

MMC will act as interim manager of the Company. In return for these services it will receive a management fee equal to 1.25% per annum of the value of the gross assets of the Company and a performance fee equal to 15% of the increase in value of the Portfolio over the All Ordinaries Accumulation Index. See Section 11.5 for details.

M&GIC Pty Limited will act as Proposed Manager of the Company. In return for these services it will receive a management fee equal to 1.25% per annum of the value of the gross assets of the Company and a performance fee equal to 15% of the increase in value of the Portfolio over the All Ordinaries Accumulation Index. See Section 11.5 for details.

Bell Potter Securities Limited will receive a 0.5% handling fee in respect of all Applications received for which Shares are issued and a further 1.5% commission on all Applications which bear its broker stamp. The appointment of Bell Potter Securities Limited may be terminated with 7 days notice. If so terminated before completion of the Offer and the Offer proceeds, the Company must pay Bell Potter a fee of $250,000.

Certain partners and employees of the above firms may subscribe for Shares and Options in the context of the Offer.

IGI

12. GLOSSARY

Terms and abbreviations used in this Prospectus have the following meaning:

AFSL	an Australian Financial Services Licence issued by ASIC under Part 7.6 of theCorporations Act.
Applicant	a person who submits an Application.
Application	an application for Shares and Options pursuant to this Prospectus.
Application Form	an application form in the form attached to this Prospectus.
Application Monies	the Application Price multiplied by the number of Shares applied for.
Application Price	$1.00 for each Share applied for.
asic	Australian Securities & Investments Commission.
asx	Australian Stock Exchange Limited.
Business Day	a day, other than a Saturday or Sunday, on which banks are open forgeneral banking business in Sydney.
Closing Date	the date by which valid acceptances must be received by the ShareRegistrar being 15 December 2003 or such other date as may be notifiedby the Company.
Company	MMC Contrarian Limited (ACN 106 248 248).
Dealer	a holder of a securities dealers licence or an AFSL
Directors or Board	the board of directors of the Company.
HGL	HGL Limited (ACN 009 657 961).
issue	the issue of Shares and Options in accordance with this Prospectus.
Listing Rules	the listing rules of ASX.
Manager	the manager of the Portfolio on behalf of the Company being MMC untilsuch time as the Proposed Manager obtains an AFSL at which time it willbe the Proposed Manager.
MMC	MMC Asset Management Limited (ACN 071 807 684).
MMC Funds	the 5 registered management investment schemes of which MMC is theresponsible entity referred to in Section 3.4.
Offer

Opening Date	the date of issue of this Prospectus, expected to be 17 October 2003.
Option	an option to acquire a Share at an exercise price of $1.00 per Share by30 June 2005 on the terms set out in Section 11.4.
Portfolio	the portfolio of investments of the Company from time to time.
Priority Allocation	the allocation of up to 20,000,000 Shares and Options to the shareholdersof HGL who apply by the Priority Allocation Date.
Priority Allocation Date	the date by which applications and subscription monies for Shares mustbe received from HGL's shareholders who wish to qualify for a PriorityAllocation of Shares and Options and is 7 November 2003.
Proposed Manager	M&GIC Pty Limited (ACN 106 477 490).
Prospectus	this prospectus dated 10 October 2003 as modified or varied by anysupplementary prospectus made by the Company and lodged with theASIC from time to time.
Security	the same meaning as in Section 92 of the Corporations Act.
Share	a fully paid ordinary share in the capital of the Company.
Shareholder	a holder of a Share.
Share Registrar	Computershare Investor Services Pty Limited.

This Prospectus has been approved by unanimous resolution of the Directors of MMC Contrarian Limited. Dated: 10 October 2003

Simon Rowell Chairman

	AMCContrarian ACN 106 248 248Limited	Registry Use Only
	Application FormThis Application Form is important. If you are in doubt as to how to deal with it, please	Broker Code	Adviser Code
	contact your stockbroker or professional adviser without delay. You should read theentire prospectus carefully before completing this form. To meet the requirements ofthe Corporations Act, this Application Form must not be distributed unlessincluded in, or accompanied by, the prospectus.
2	I/we apply forE
		AS	L
	Number of Shares
G	Individual/Joint applications - refer to naming standards overleaf for correct forms of registrable title(s)Title or Company NameGiven Name(s)	Sumame

	Joint Applicant 2 or Account Designation

	Joint Applicant 3 or Account Designation

D
	Street Name or PO Box/Other InformationUnitStreet Number





聞者	Enter your contact details
	Contact Name	Telephone Number - Business Hours / After Hours

■	CHESS Participant
	Holder Identification Number (HIN)
	X	Please note that if you supply a CHESS HIN but the name and address details on your form do notcorrespond exactly with the registration details held at CHESS, your application will be deemed to be madewithout the CHESS HIN, and any securities issued as a result of the IPO will be held on the Issuer Sponsored
		subregister.

rawei200000000000000000000000000000000000000800000000000000000000000000000000000000	Cheque Number100000000000000000000000000000000000000.	BSB Number,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,, 2010.00.00.00.00.00.00.00.00.00.00.00.00.	Account Number000000000000000000000000000000000000000200000000000000000000000000000000000000	Amount of cheque 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 199
rawei	Cheque Number	BSB Number	Account Number	Amount of cheque
a da a composição de construções de construções de construções de construções de construções de construções de,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,		n en de la component de la component de la component de la component de la component de la component de la comLa component de la component de la component de la component de la component de la component de la component d$\blacksquare$	ananananananananananana,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,	\\\\\\\\\\\\\\\\\\\

By submitting this Application Form, I/we declare that this application is completed and lodged according to the Prospectus and the declarations/statements on the reverse of this Application form and I/we declare that all

How to complete this form

$|A|$ Shares Applied for

Enter number of Shares you wish to apply for. The Application must be for a minimum of 2000 Shares. Applications for greater than 2000 Shares must be in multiples of 100 Shares.

Application Monies

Enter number of Application Monies. To calculate the amount, multiply the number of Shares by $1.00.

C Applicant Name(s)

Enter the full name you wish to appear on the statement of share holding. This must be either your name or the name of a company. Up to 3 joint Applicants may register. You should refer to the table below for the correct forms of registrable title. Applications using the wrong form of names may be rejected. Clearing House Electronic Subregister System (CHESS) participants should complete their name identically to that presently registered in the CHESS system.

Postal Address $\mathbf{D}$

Enter your postal address for all correspondence. All communications to you from the Registry will be mailed to the person(s) and address as shown. For joint Applicants, only one address can be entered.

Contact Details E.

Enter your contact details. These are not compulsory but will assist us if we need to contact you.

F CHESS

MMC Contrarian Limited (the Company) will apply to the ASX to participate in CHESS, operated by ASX Settlement and Transfer Corporation Pty Ltd, a wholly owned subsidiary of Australian Stock Exchange Limited. In CHESS. the Company will operate an electronic CHESS Subregister of security holdings and an electronic Issuer Sponsored Subregister of securities. Together the two Subregisters will make up the Company's principal register of securities. The Company will not be issuing certificates to applicants in respect of Shares allotted. If you are a CHESS participant (or are sponsored by a CHESS participant) and you wish to hold Shares allotted to you under this Application on the CHESS Subregister, enter your CHESS HIN. Otherwise, leave this section blank and on allotment, you will be sponsored by the Company and allocated a Securityholder Reference Number (SRN).

G Payment

Make your cheque or bank draft payable to MMC Contrarian Limited -Float Account in Australian currency and cross it Not Negotiable. Your cheque or bank draft must be drawn on an Australian Bank.

Complete the cheque details in the boxes provided. The total amount must agree with the amount shown in box C.

Cheques will be processed on the day of receipt and as such, sufficient cleared funds must be held in your account as cheques returned unpaid may not be re-presented and may result in your Application being rejected. Pin (do not staple) your cheque(s) to the Application Form where indicated. Cash will not be accepted. Receipt for payment will not be forwarded.

Before completing the Application Form the Applicant(s) should read this prospectus to which this application relates. By lodging Application Form, the applicant agrees that this application for Shares in MMC Contrarian Limited is upon and subject to the terms of the prospectus and the Constitution of MMC Contrarian Limited, agrees to take any number of Shares that may be allotted to the Applicant(s) pursuant to the prospectus and declares that all details and statements made are complete and accurate. It is not necessary to sign the Application Form.

Lodgement of Application

Application Forms must be received at the Melbourne office of Bell Potter Securities Limited by no later than 5pm (EST) on 15 December 2003. Return the Application Form with cheque(s) attached to:

Bell Potter Securities Limited Level 28, 80 Collins Street Melbourne VIC 3000

Privacy Statement

Personal information is collected on this form by Computershare Investor Services Pty Limited ("CIS"), as registrar for securities issuers ("the issuer"), for the purpose of maintaining registers of securityholders, facilitating distribution payments and other corporate actions and communications. Your personal information may be disclosed to our related bodies corporate, to external service companies such as print or mail service providers, or as otherwise required or permitted by law. If you would like details of your personal information held by CIS, or you would like to correct information that is inaccurate, incorrect or out of date, please contact CIS. In accordance with the Corporations Act 2001, you may be sent material (including marketing material) approved by the issuer in addition to general communications. You may elect not to receive marketing material by contacting CIS. You can contact CIS using the details provided on the front of this form or E-mail [email protected]

If you have any enquiries concerning your application, please contact Bell Potter Securities Limited on 1300 305 476.

Correct forms of registrable title(s)

Note that ONLY legal entities are allowed to hold Shares. Applications must be made in the name(s) of natural persons, companies or other legal entities in accordance with the Corporations Act. At least one full given name and the surname is required for each natural person. The name of the beneficial owner or any other registrable name may be included by way of an account designation if completed exactly as described in the examples of correct forms of registrable title(s) below.

Type of Investor	Correct Form of Registration	Incorrect Form of Registration
Individual- Use given name(s) in full, not initials	Mr John Alfred Smith	J.A Smith
Joint- Use given name(s) in full, not initials	Mr John Alfred Smith &Mrs Janet Marie Smith	John Allied &Janet Mane Smith
Company- Use company title, not abbreviations	ABC Pty Ltd	ABC P/LABC Co
Trusts- Use trustee(s) personal name(s)- Do not use the asme of the trust	Ms Penny Smith	Penny Smith Family Trust
Deceased Estates- Use executor(s) personal name(s)- Do not use the name of the deceased	Mr Michael Smith	Estate of Late John Sasith 3
Minor (a person under the age of 18)- Use the name of a responsible adult with an appropriate designation.	Mr John Alfred Smith	Peter Smith
Partnerships- Use partners personal name(s)- Do not use the name of the partnership	Mr John Smith &Mr Michael Smith<john &="" a="" c="" smith="" son="">	John Smith & Stati
Clubs/Unincorporated Bodies/Business Names- Use office bearer(s) personal name(s)- Do not use the asme of the club etc.	Mrs Janet Smith	mulaABC Termins Association
Superannuation Funds- Use the name of trustee of the fund- Do not use the asme of the fund	John Smith Pty Ltd	John Smith Ptv Ltd Superannuation Fund

	AMCContrarian ACN 106 248 248Limited	Registry Use Only
	Application FormThis Application Form is important. If you are in doubt as to how to deal with it, please	Broker Code	Adviser Code
	contact your stockbroker or professional adviser without delay. You should read theentire prospectus carefully before completing this form. To meet the requirements ofthe Corporations Act, this Application Form must not be distributed unlessincluded in, or accompanied by, the prospectus.
2	I/we apply forE
		AS	L
	Number of Shares
G	Individual/Joint applications - refer to naming standards overleaf for correct forms of registrable title(s)Title or Company NameGiven Name(s)	Sumame

	Joint Applicant 2 or Account Designation

	Joint Applicant 3 or Account Designation

D
	Street Name or PO Box/Other InformationUnitStreet Number





聞者	Enter your contact details
	Contact Name	Telephone Number - Business Hours / After Hours

■	CHESS Participant
	Holder Identification Number (HIN)
	X	Please note that if you supply a CHESS HIN but the name and address details on your form do notcorrespond exactly with the registration details held at CHESS, your application will be deemed to be madewithout the CHESS HIN, and any securities issued as a result of the IPO will be held on the Issuer Sponsored

rawei200000000000000000000000000000000000000800000000000000000000000000000000000000	Cheque Number100000000000000000000000000000000000000.	BSB Number,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,, 2010.00.00.00.00.00.00.00.00.00.00.00.00.	Account Number000000000000000000000000000000000000000200000000000000000000000000000000000000	Amount of cheque 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 199
rawei	Cheque Number	BSB Number	Account Number	Amount of cheque
a da a composição de construções de construções de construções de construções de construções de construções de,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,		n en de la component de la component de la component de la component de la component de la component de la comLa component de la component de la component de la component de la component de la component de la component d$\blacksquare$	ananananananananananana,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,	\\\\\\\\\\\\\\\\\\\

How to complete this form

$|A|$ Shares Applied for

Enter number of Shares you wish to apply for. The Application must be for a minimum of 2000 Shares. Applications for greater than 2000 Shares must be in multiples of 100 Shares.

Application Monies

Enter number of Application Monies. To calculate the amount, multiply the number of Shares by $1.00.

C Applicant Name(s)

Postal Address $\mathbf{D}$

Contact Details E.

Enter your contact details. These are not compulsory but will assist us if we need to contact you.

F CHESS

G Payment

Make your cheque or bank draft payable to MMC Contrarian Limited -Float Account in Australian currency and cross it Not Negotiable. Your cheque or bank draft must be drawn on an Australian Bank.

Complete the cheque details in the boxes provided. The total amount must agree with the amount shown in box C.

Lodgement of Application

Application Forms must be received at the Melbourne office of Bell Potter Securities Limited by no later than 5pm (EST) on 15 December 2003. Return the Application Form with cheque(s) attached to:

Bell Potter Securities Limited Level 28, 80 Collins Street Melbourne VIC 3000

Privacy Statement

If you have any enquiries concerning your application, please contact Bell Potter Securities Limited on 1300 305 476.

Correct forms of registrable title(s)

Type of Investor	Correct Form of Registration	Incorrect Form of Registration
Individual- Use given name(s) in full, not initials	Mr John Alfred Smith	J.A Smith
Joint- Use given name(s) in full, not initials	Mr John Alfred Smith &Mrs Janet Marie Smith	John Allied &Janet Mane Smith
Company- Use company title, not abbreviations	ABC Pty Ltd	ABC P/LABC Co
Trusts- Use trustee(s) personal name(s)- Do not use the asme of the trust	Ms Penny Smith	Penny Smith Family Trust
Deceased Estates- Use executor(s) personal name(s)- Do not use the name of the deceased	Mr Michael Smith	Estate of Late John Sasith 3
Minor (a person under the age of 18)- Use the name of a responsible adult with an appropriate designation.	Mr John Alfred Smith	Peter Smith
Partnerships- Use partners personal name(s)- Do not use the name of the partnership	Mr John Smith &Mr Michael Smith<john &="" a="" c="" smith="" son="">	John Smith & Stati
Clubs/Unincorporated Bodies/Business Names- Use office bearer(s) personal name(s)- Do not use the asme of the club etc.	Mrs Janet Smith	mulaABC Termins Association
Superannuation Funds- Use the name of trustee of the fund- Do not use the asme of the fund	John Smith Pty Ltd	John Smith Ptv Ltd Superannuation Fund

	AMCContrarian ACN 106 248 248Limited	Registry Use Only
	Application FormThis Application Form is important. If you are in doubt as to how to deal with it, please	Broker Code	Adviser Code
	contact your stockbroker or professional adviser without delay. You should read theentire prospectus carefully before completing this form. To meet the requirements ofthe Corporations Act, this Application Form must not be distributed unlessincluded in, or accompanied by, the prospectus.
2	I/we apply forE
		AS	L
	Number of Shares
G	Individual/Joint applications - refer to naming standards overleaf for correct forms of registrable title(s)Title or Company NameGiven Name(s)	Sumame

	Joint Applicant 2 or Account Designation

	Joint Applicant 3 or Account Designation

D
	Street Name or PO Box/Other InformationUnitStreet Number





聞者	Enter your contact details
	Contact Name	Telephone Number - Business Hours / After Hours

■	CHESS Participant
	Holder Identification Number (HIN)
	X	Please note that if you supply a CHESS HIN but the name and address details on your form do notcorrespond exactly with the registration details held at CHESS, your application will be deemed to be madewithout the CHESS HIN, and any securities issued as a result of the IPO will be held on the Issuer Sponsored

rawei200000000000000000000000000000000000000800000000000000000000000000000000000000	Cheque Number100000000000000000000000000000000000000.	BSB Number,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,, 2010.00.00.00.00.00.00.00.00.00.00.00.00.	Account Number000000000000000000000000000000000000000200000000000000000000000000000000000000	Amount of cheque 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 1999 - 199
rawei	Cheque Number	BSB Number	Account Number	Amount of cheque
a da a composição de construções de construções de construções de construções de construções de construções de,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,		n en de la component de la component de la component de la component de la component de la component de la comLa component de la component de la component de la component de la component de la component de la component d$\blacksquare$	ananananananananananana,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,	\\\\\\\\\\\\\\\\\\\

How to complete this form

$|A|$ Shares Applied for

Enter number of Shares you wish to apply for. The Application must be for a minimum of 2000 Shares. Applications for greater than 2000 Shares must be in multiples of 100 Shares.

Application Monies

Enter number of Application Monies. To calculate the amount, multiply the number of Shares by $1.00.

C Applicant Name(s)

Postal Address $\mathbf{D}$

Contact Details E.

Enter your contact details. These are not compulsory but will assist us if we need to contact you.

F CHESS

G Payment

Make your cheque or bank draft payable to MMC Contrarian Limited -Float Account in Australian currency and cross it Not Negotiable. Your cheque or bank draft must be drawn on an Australian Bank.

Complete the cheque details in the boxes provided. The total amount must agree with the amount shown in box C.

Lodgement of Application

Application Forms must be received at the Melbourne office of Bell Potter Securities Limited by no later than 5pm (EST) on 15 December 2003. Return the Application Form with cheque(s) attached to:

Bell Potter Securities Limited Level 28, 80 Collins Street Melbourne VIC 3000

Privacy Statement

If you have any enquiries concerning your application, please contact Bell Potter Securities Limited on 1300 305 476.

Correct forms of registrable title(s)

Type of Investor	Correct Form of Registration	Incorrect Form of Registration
Individual- Use given name(s) in full, not initials	Mr John Alfred Smith	J.A Smith
Joint- Use given name(s) in full, not initials	Mr John Alfred Smith &Mrs Janet Marie Smith	Johit Alfred &Janet Mane Smith
Company- Use company title, not abbreviations	ABC Pty Ltd	ABC P/LABC Co
Trusts- Use trustee(s) personal name(s)- Do not use the asme of the trust	Ms Penny Smith	Penny Smith Family Trust
Deceased Estates- Use executor(s) personal name(s)- Do not use the name of the deceased	Mr Michael Smith	Estate of Late John Sasith 3
Minor (a person under the age of 18)- Use the name of a responsible adult with an appropriate designation.	Mr John Alfred Smith	Peter Smith
Partnerships- Use partners personal name(s)- Do not use the name of the partnership	Mr John Smith &Mr Michael Smith<john &="" a="" c="" smith="" son="">	John Smith & Stati
Clubs/Unincorporated Bodies/Business Names- Use office bearer(s) personal name(s)- Do not use the asme of the club etc.	Mrs Janet Smith	mulaABC Termins Association
Superannuation Funds- Use the name of trustee of the fund- Do not use the asme of the fund	John Smith Pty Ltd	John Smith Ptv Ltd Superannuation Fund

AI assistant

SCHOOLBLAZER LIMITED — Share Issue/Capital Change 2003

65751_rns_2003-10-21_d2a04c82-bd0f-4652-a125-5ad3ccd6380a.pdf

MMC Contrarian Limited

DIRECTORY

Directors

Registered Office

Initial Manager

Proposed Manager

Sponsoring Broker

Auditor

Independent Accountant

Tax Advisor

Share Registry

Solicitors to the Offer

INDICATIVE TIMETABLE

TABLE OF CONTENTS

IMPORTANT NOTICES

LICENSED INTERMEDIARIES

PROSPECTUS AVAILABILITY

HOW TO APPLY

WHEN TO APPLY

ENQUIRIES

1. INFORMATION FOR INVESTORS

$1.1$ The Offer

1.2 Business Overview

$1.3$ Management

Management Fee

Performance Fee

$1.4$ Risk Factors

Offer not Underwritten $1.5$

$1.6$ Minimum Subscription

1.7 How to Apply

$1.8$ ASX Listing

1.9 Allotment

1.10 CHESS

1.11 Overseas Shareholders

$\mathbf{2}$ . MMC CONTRARIAN LIMITED

$2.1$ Overview of Business

2.2 Company Objectives

2.3 Investment Philosophy

2.4 Investment Strategy

Research and Investment Process

$2.5 -$ Permitted Investments

2.6 LIC Status

$2.7$ Reports to Shareholders

3. INFORMATION ON MMC

$3.1$ Business of MMC

$3.2$ MMC's Investment Team

3.3 Investment Process

DESIRABLE INVESTMENT CRITERIA

3.4 Performance History

4. HGL

Business of HGL 4.1

4.2 Background of HGL

4.3 Investment Process

$4.4 -$ Performance History

5. MANAGEMENT STRUCTURE

5.1 Joint Management Structure

5.2 Business of Proposed Manager

$5.3 -$ No Performance History

5.4 Key Personnel of the Manager

5.5 Board participation in management

6. FINANCIAL INFORMATION

$6.1$ Pro Forma Statements of Financial Position

PROFORMA CASH POSITION

Basis of preparation

6.2 Proposed Accounting Policies and Notes to Accounts

$\bf(1)$ Basis of preparation of accounts

$(2)$ Investments

$(3)$ Investment income

Dividend Income

Distribution Income

Interest income

6.3 Income Tax

$6.4$ Dividend Policy

$\mathcal{I}$ DIRECTORS

71 Chairman - Simon Rowell BA (Hons), CA, FAICD

$7.2$ Erik Metanomski

73 Kevin Eley

SCHOOLBLAZER LIMITED Share Issue/Capital Change 2003