AUSTRALIAN UNITY LIMITED — Capital/Financing Update 2015

Nov 16, 2015

Date of replacement Offer Specific Prospectus: 17 November 2015

This replacement Offer Specific Prospectus relates to the offer of “Series B Australian Unity Bonds – Tranche 1” simple corporate bonds by Australian Unity Limited (the “Offer”) under the Base Prospectus dated 9 November 2015 (“Base Prospectus”). This replacement Offer Specific Prospectus must be read together with the Base Prospectus.

The disclosure documents for the Offer consists of this replacement Offer Specific Prospectus and the Base Prospectus.

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Australian Unity Bonds

Part A: replacement Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

Issuer

Australian Unity Limited ABN 23 087 648 888

Arrangers Joint Lead Managers Co-managers Evans and Partners ANZ Securities Limited Australian Unity Funds Management National Australia Bank Limited Evans and Partners JBWere Limited National Australia Bank Limited

Part A: Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

Table of Contents

Table	of	Contents
Section	1	What you need to know	3
Section	2	Key dates and Offer details	7
Section	3	Offer specific information that you should consider	13
Section	4	How to apply	25

2 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

A

Section One

What you need to know

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4 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

1. This replacement Offer Specific Prospectus is not a summary of the information contained in the Base Prospectus. You must read the Base Prospectus together with this replacement Offer Specific Prospectus.

2. This replacement Offer Specific Prospectus is only relevant for the offer of Series B Australian Unity Bonds – Tranche 1 (the “ Offer ”).

3. A Base Prospectus applies to this Offer.

4. This replacement Offer Specific Prospectus provides Offer details, key dates and other relevant information for the Offer. The Base Prospectus provides additional information that is also critical to your investment decision. You should take all of the information in the Base Prospectus into consideration before making your decision in relation to the Offer.

5. About this Offer Specific Prospectus

This replacement Offer Specific Prospectus relates to an offer by Australian Unity Limited (ABN 23 087 648 888) (“ Australian Unity ” or the “ Issuer ”) to issue $230 million of Series B Australian Unity Bonds – Tranche 1 (“ Bonds ”), with the ability to raise more or less subject to a minimum issue amount of $50 million, on the terms set out in this replacement Offer Specific Prospectus and the Base Prospectus. This replacement Offer Specific Prospectus and the Base Prospectus are together referred to as the “ Offer Documents ”.

This replacement Offer Specific Prospectus is dated 17 November 2015 and was lodged with the Australian Securities and Investments Commission (“ ASIC ”) on that date. This replacement Offer Specific Prospectus replaces the Offer Specific Prospectus dated and lodged with ASIC on 9 November 2015 (“ Original Offer Specific Prospectus ”). References to Offer Specific Prospectus in this document are references to this replacement Offer Specifics Prospectus. This Offer Specific Prospectus is only relevant to the Offer (i.e. the offer of the Bonds) and expires on the date which is 13 months after the date the Original Offer Specific Prospectus was lodged with ASIC. No Bonds will be issued on the basis of the Offer Documents after that date. The Bonds are unsecured notes for the purposes of section 283BH of the Corporations Act .

1. The Offer Documents, including any information referred to or incorporated by reference therein, contain important information. It is important that you read the Offer Documents in full before making a decision to invest in Bonds and consider the risks that could affect the performance of the Bonds. Information about Australian Unity can be found in Section 3 (“ About Australian Unity ”) of the Base Prospectus and is also available at www.australianunity.com.au/bonds.

2. You should rely only on information in the Offer Documents. No person is authorised to give any information or to make any representation in connection with the Offer which is not contained in the Offer Documents. Any information or representation not contained in the Offer Documents may not be relied upon as having been authorised by Australian Unity or any other member of the Australian Unity Group in connection with the Offer.

3. The Offer Documents do not provide financial product or investment advice

The information contained in the Offer Documents does not constitute financial product or investment advice and has been prepared without taking into account your investment objectives, financial situation or particular needs (including financial and taxation issues). The Offer Documents are only relevant for investors or potential investors in the Bonds and should not be used for any other purpose.

1. Obtaining the Base Prospectus and Application Form

Paper copies of this Offer Specific Prospectus, the Base Prospectus, an Application Form and any documents incorporated by reference can be obtained free of charge by calling the Australian Unity Bonds Information Line on 1800 550 560 (within Australia) or +61 1800 550 560 (outside Australia) Monday to Friday 8:30 am to 5:30 pm (AEDST) during the Offer Period. Links to electronic copies may also be obtained from www.australianunity.com.au/bonds during the Offer Period and from www.australianunity.com.au/bonds following the completion of the Offer.

1. Defined words and expressions

Some words and expressions used in this Offer Specific Prospectus have defined meanings. These words and expressions are capitalised and are defined in Section 6 (“ Glossary ”) of the Base Prospectus.

ASIC guidance for corporate bond investors

To find out more about the pros and cons of investing in corporate bonds (such as the Bonds), visit ASIC’s MoneySmart website: www.moneysmart.gov.au

5

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Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

A

Section Two

Key dates and Offer details

More information on bonds (such as the Bonds) and things you should consider before making an investment decision can be found on ASIC’s MoneySmart website at www.moneysmart.gov.au

Credit Rating and Product Complexity Indicator

The Bonds have been assigned a BBB+ long-term Credit Rating by Australia Ratings, although Australian Unity itself is not rated by Australia Ratings. Australia Ratings has also assigned a ‘Green’ Product Complexity Indicator to the Bonds. Refer to Section 3.6 for further information about the Credit Rating and Product Complexity Indicator associated with Australian Unity Bonds and Section 3.7.3 for risks associated with Credit Ratings.

7

Section two Key dates and Offer details

Key dates for the Offer

Key dates for the Ofer
Reinvestment Record Date for determining Eligible 2011 Notes holders (7:00 pm AEDST)	5 November 2015
Lodgement of Original Offer Specific Prospectus with ASIC	9 November 2015
Bookbuild to determine Margin and Allocations to Syndicate Brokers and Institutional Investors	16 November 2015
Opening Date for the Offer and lodgement of this replacement Offer Specific Prospectus with ASIC	17 November 2015
Closing Date for the Member Offer and Reinvestment Offer	4 December 2015
Closing Date for the Broker Firm Offer	11 December 2015
Issue Date	15 December 2015
Bonds commence trading on ASX on deferred settlement basis	16 December 2015
Holding Statements despatched by the Registry	17 December 2015
Bonds commence trading on ASX on normal settlement basis	18 December 2015

Key dates for the Bonds

Key dates for the Bonds
First Interest Payment Date1	14 April 2016
Maturity Date	15 December 2020

Dates may change

The key dates for the Offer are indicative only and subject to change without notice. Australian Unity may, in agreement with the Joint Lead Managers, vary the timetable, including to close the Member Offer, the Reinvestment Offer or the Broker Firm Offer early, extend any one or all of them, or to withdraw any one or all of them at any time prior to Issue. If any of the dates are changed, subsequent dates may also change. If you decide to invest in the Bonds, you are encouraged to lodge your Application as soon as possible after the Opening Date.

1 Interest is scheduled to be paid on the quarterly Interest Payment Dates, until the Maturity Date or any earlier Redemption Date. If any of these scheduled dates is not a Business Day, then the Interest Payment Date will be the next Business Day. The first Interest Payment Date will be 14 April 2016.

Notes

8 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

2.1 Terms of the Offer of Bonds

The following terms (“ Offer Specific Terms ”), together with the terms set out in the Base Prospectus (as supplemented, amended, modified or replaced by the Offer Specific Terms) (“ Base Terms ”), are the terms and conditions of the Bonds and the Offer, the subject of this Offer Specific Prospectus (“ Terms ”). Unless otherwise specified, capitalised expressions in the Offer Specific Terms have the meanings given in the Base Terms.

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Issuer	Australian Unity Limited (ABN 23 087 648 888)	Section 3 of this Ofer Specifc	13
		Prospectus
		Base Prospectus (Section 3)	19
Series / Tranche	Series B, Tranche 1
Series B Australian Unity	Interest paying, unsubordinated and unsecured debt	Base Prospectus (Sections 2.1.2	9 & 15
Bonds – Tranche 1	obligations, issued by Australian Unity.	and 2.1.5)
	Each Bond is issued on and subject to the provisions	Base Terms (Clauses 2 and 3)
	of the Trust Deed and the Terms.
Ofer size	$230 million, with the ability to raise more or less.
	The minimum Ofer size is $50 million. If total application
	monies received are less than $50 million, then no Bonds
	will be issued under the Ofer.
Face Value / Issue Price	$100 per Bond
Ofer Structure	The Ofer comprises:	Ofer Specifc Prospectus	25
	- Member Ofer
	- Broker Firm Ofer
	- Institutional Ofer
	- Reinvestment Ofer
Minimum Application	50 Bonds for applicants under the Broker Firm Ofer
	($5,000) and 20 Bonds for applicants under the
	Member Ofer ($2,000).
Term	5 years
Maturity Date	15 December 2020 (unless Redeemed early)
No Guarantee	The payment obligations of the Issuer under the Bonds
	are not guaranteed by any subsidiary of Australian Unity
	nor any other person.
Interest Rate	Floating Interest Rate.	Base Prospectus (Section 2.1.2),	9
	The Interest Rate is the sum of the Market Rate	Base Terms (Clause 2)
	plus the Margin.
Market Rate	Bank Bill Rate for a three month period.
Bank Bill Rate	Refer to Section 2.1.2 of the Base Prospectus which	Base Prospectus (Section 2.1.2)	10
	describes the Bank Bill Rate.

9

Section two Key dates and Offer details (continued)

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Margin	The Margin is 2.80 percent per annum which was
	determined under the Bookbuild.
Interest Payment Dates	The frst Interest Payment Date will be 14 April 2016.	Base Prospectus (Section 2.1.2)	10
	Interest will be paid quarterly in arrears on the following
	dates in each year as well as on the Maturity Date, or any
	earlier Redemption Date:
	- 14 January
	- 14 April
	- 14 July
	- 14 October.
	If any of these scheduled dates is not a Business Day, then
	the Interest Payment Date will be the next Business Day.
	Interest will continue to accrue until that date.
Business Day Convention	Following Business Day Convention	Base Prospectus (Section 6),	51
		Glossary
Day Count Fraction	Actual/365 (Fixed)	Base Prospectus (Section 6),	50
		Glossary
Early Redemption	Australian Unity will only have the right (but not	Base Prospectus (Section 2.1.3),	11
	the obligation) to Redeem the Bonds prior to	Base Terms (Clause 5)
	the Maturity Date:
	- following the occurrence of a Tax Event;
	- following the occurrence of a Change
	of Control Event; or
	- when a Clean Up Condition subsists.
Early Redemption	Holders of Bonds will only have the right to vote to require	Base Prospectus (Section 2.1.3),	11
rights of Holders	Redemption prior to the Maturity Date following the	Base Terms (Clause 5.4)
	occurrence of a Change of Control Event (which requires a
	Holder Resolution to be passed in favour of Redemption).
Negative pledge	Australian Unity will not secure any “Relevant	Base Prospectus (Section 2.1.4),	14
	Indebtedness” without according the same security (or	Base Terms (Clause 4.1)
	an equal ranking security) to the Bonds. Some security
	interests are excluded from the negative pledge –
	including the “Existing Security” on the following page and
	any security interests in respect of syndicated or term loan
	arrangements within the limit described in Section 2.1.4 of
	the Base Prospectus.
	“Relevant Indebtedness” broadly means debt securities
	issued by Australian Unity (including Bonds of another
	Series) which are quoted on a stock exchange and
	indebtedness owing under syndicated or term loan
	arrangements.
Covenant Gearing	While any Bonds remain outstanding, the Issuer will ensure	Base Prospectus (Section 2.1.4),	14
Ratio limit	that, on each 30 June and 31 December occurring after	Base Terms (Clause 4.2)
	the Issue Date, the Covenant Gearing Ratio is not greater
	than 50 percent.

10 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

Section two Key dates and Offer details (continued)

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Restrictions on	Certain Subsidiaries of Australian Unity must not incur	Base Prospectus (Section 2.1.4),	15
Subsidiary Indebtedness	Financial Indebtedness, as described in Section 2.1.4	Base Terms (Clause 4.3)
	of the Base Prospectus.
	For the purposes of Clause 4.3(e) of the Base Terms, the
	following Subsidiary Financial Indebtedness is not subject
	to this restriction:
	- Retirement Village Investment Notes issued by
	Australian Unity Finance Limited;
	- $30 million subordinated capital notes issued by
	Australian Unity Health Limited (and any other such
	subordinated capital notes provided the outstanding
	aggregate principal amount does not exceed
	$50 million);
	- $5.1 million in loans between Grand United Centenary
	Centre Limited and Australian Unity Retirement Living
	Management Pty Ltd dated 31 August 2012;
	- $49 million Carlton Residential Aged Care Facility
	Agreement between Australian Unity Retirement
	Development Management Pty Ltd in its capacity
	as responsible entity for the Australian Unity Carlton
	Aged Care Trust, Australian Unity Care Services Pty Ltd
	and Australian Unity Aged Care Investments Pty Ltd
	(borrowers) and Australia and New Zealand Banking
	Group Limited.
Ranking on winding up	A Holder’s claim will rank equally with holders of	Base Prospectus (Section 2.1.5	16
	other Series of Bonds, equally with claims of all other	and 4.2.6), Base Terms (Clause 3)
	unsubordinated and unsecured creditors (other than
	any obligations preferred by mandatory provisions of
	applicable law, including employee entitlements and
	secured creditors). A Holder’s claim will rank ahead of
	all holders of subordinated instruments and member
	interests in Australian Unity.
	Holders’ claims are subject to structural subordination
	which is explained in the Base Prospectus.
Events of Default	Events of Default are set out in the Base Terms and	Base Prospectus (Section 2.1.3),	13
	described in the Base Prospectus and include non-	Base Terms (Clause 6)
	payment of principal or interest, failure by Australian Unity
	to comply with certain other obligations, the insolvency
	of Australian Unity or the cessation or suspension by
	Australian Unity of the conduct of its business.
Existing Security	As at the date of this Ofer Specifc Prospectus, none of
	Australian Unity’s existing fnanciers or investors have
	the beneft of any security granted by Australian Unity,
	apart from the security granted by Australian Unity to The
	Trust Company (Australia) Limited in respect of the 2011
	Notes (which is excluded from the negative pledge as a
	“Permitted Encumbrance”, see further Section 4.2(f)).
Fees and charges	No fees, charges, brokerage, commission or stamp duty
	are payable by you on your application for the Bonds.
	You may be required to pay brokerage if you sell your
	Bonds after the Bonds are quoted on ASX.

11

Section two Key dates and Offer details (continued)

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Fees and costs	The total expenses of the Ofer (including fees payable to	Further details incorporated by
associated with	the Joint Lead Managers, legal, accounting, tax, marketing,	reference (Section 3.8.4)
the Ofer	and administrative fees, as well as printing, advertising and
	other expenses related to the Ofer) are expected to be
	A$5.7m. All of these expenses have been, or will be, borne
	by Australian Unity out of the proceeds of the Ofer.
Listing	Australian Unity has applied for the quotation
	of the Bonds on ASX.
	It is expected that the Bonds will be quoted
	under the code “AYUHB”.
Selling restrictions	Selling restrictions apply to the sale of Australian Unity	Base Prospectus (Section 5.3)	15
	Bonds in certain foreign jurisdictions.

If you have any questions about the Bonds or the Offer, you should seek advice from your financial adviser or other professional adviser. You can also call the Australian Unity Bonds information line on 1800 550 560 (within Australia) or +61 1800 550 560 (outside Australia) (Monday to Friday 8:30 am – 5:30 pm (AEDST)) during the Offer Period.

12 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

A

Section Three

Offer specific information you should consider

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Section three Offer specific information you should consider

3.1 Business update

Acquisition of Home Care NSW

On 28 August 2015, Australian Unity announced the execution of an agreement with the New South Wales Government to transfer the Home Care Service of New South Wales (“ Home Care NSW ”) as a discrete entity to become part of the Australian Unity Group.

Home Care NSW provides in-home care services to approximately 50,000 clients across New South Wales and has approximately 4,000 employees. Australian Unity has provided home care services for more than ten years and has services in Victoria, New South Wales and Queensland. The transfer will result in Home Care NSW becoming one of the largest areas of operation within the Australian Unity Group and, in turn, Australian Unity will be one of the largest home care providers nationally.

Under the transfer agreement, Home Care NSW’s staff will transfer to Australian Unity with their existing employment terms and conditions set for two years for permanent staff and six months for casual staff. Australian Unity will buy Home Care NSW for $114 million, subject to adjustments. The transaction will be funded by cash and debt. The transfer is expected to be finalised in early 2016.

Acquisition rationale and benefits to the Australian Unity Group

Alignment to Australian Unity’s	The Australian Unity Group operates with a strong social purpose, centred on providing
social purpose	solutions to the demographic challenges facing Australia from the ageing population
	and rise of chronic disease.
Alignment to Australian Unity’s	To create Australia’s leading home care business—one that ofers a true continuum
strategic goals	of client-directed care.
Complementary to existing portfolio	Australian Unity Group operates a portfolio of wellbeing-related businesses, including
	aged care, retirement living, home care, health insurance, fnancial advice, estate and
	administration services, banking and investment products.
Scale opportunity	Meaningful scale in home care services and creates a platform for further growth.
Value creation	Home Care NSW clients often transfer to other service providers when their needs
	change as their current provider is not always able to provide higher levels of care.
	One of the key benefts Australian Unity brings to clients of Home Care NSW is Australian
	Unity Group’s extensive range of services.

Project Albert

Australian Unity has announced plans to repurpose its head office and adjacent real estate assets in Albert Road, South Melbourne, Victoria into an aged care, retirement living and community wellbeing precinct. Australian Unity is in negotiations to enter into a lease for its new head office, to be situated in the Melbourne CBD. This project is aimed at delivering a solution for the housing of its central Melbourne workforce from 2018 onwards.

3.2 Use of proceeds of the Offer

The proceeds of the Offer will be used for refinancing the Australian Unity Notes issued in 2011 (“ 2011 Notes ”), partly financing the purchase of Home Care NSW and for general corporate purposes.

14 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

3.3 Effect of the Offer on Australian Unity

Assuming the Offer raises $230 million, there will be no material impact on the net assets of Australian Unity as the net cash raised (after transaction costs of $5.7 million) from the issue of the Bonds will be held in cash or used to repay existing debt. However, it is expected that the Covenant Gearing Ratio will increase as a result of the settlement of Home Care NSW (estimated to be early 2016). Assuming that $100 million of net additional borrowings has been undertaken to fund the acquisition and that the acquisition had been completed on 30 June 2015, and that the acquisition results in no change to the net assets of Australian Unity, then the Covenant Gearing Ratio would increase to 39.9 percent from 31.5 percent.

3.4 Key financial ratios

Sources of financial information

This section describes some of the key financial indicators that will help you assess the financial position and strength of Australian Unity. In addition to these key financial indicators, you should also consider Australian Unity’s financial statements available from Australian Unity’s 2015 Annual Report.

You must refer to section 3.8.2 of the Base Prospectus which describes the Key Financial Ratios.

The tables below set out:

• the prescribed Key Financial Ratios (Gearing Ratio, Interest Cover Ratio and Working Capital Ratio) which are calculated on the basis prescribed by the Corporations Act and Corporations Regulation 6D.2.06;

• the Covenant Gearing Ratio, which is the gearing ratio typically used by the business and for certain of Australian Unity’s credit facilities and, in particular, which is a provision of the Base Terms;

• the AU Interest Cover Ratio which is the interest cover ratio typically used by the business and for certain of Australian Unity’s credit facilities; and

• the ADI Tier 1 Capital Ratio.

The ratios are based on financial information for the financial years ended 30 June 2013, 30 June 2014 and 30 June 2015 and on the basis of applicable accounting standards in force as at those dates. For ongoing reporting of these ratios the amount of debt included in the Covenant Gearing Ratio will continue to be calculated by reference to the Australian Accounting Standards in place as at the date of the Base Prospectus, unless Australian Unity decides to determine the amount of debt in accordance with current applicable accounting standards and notifies the Holders of that decision. As a result, a change in accounting standards may cause movements in the prescribed Gearing Ratio but will not change the calculation of the Covenant Gearing Ratio (unless Australian Unity decides to determine the amount of the debt in accordance with current applicable accounting standards).

Prescribed Key Financial Ratios

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Financial ratio FY13 FY14 FY15
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Gearing Ratio (prescribed)	698.6%	708.8%	697.9%
Working Capital Ratio (prescribed)	1.61x	1.58x	1.32x
Interest Cover Ratio (prescribed)*	(5.76)x	(9.24)x	(8.26)x

• In the case of Australian Unity, a negative Interest Cover Ratio indicates that interest income exceeds interest expense.

Important note: the Gearing Ratio, Working Capital Ratio and Interest Cover Ratio set out above are calculated on the prescribed basis. The intended purpose of this requirement is to give an indication of the capacity of an issuer to meet its obligations to Holders under the Bonds.

15

Section three Offer specific information you should consider (continued)

However, Australian Unity does not consider the prescribed Gearing Ratio and Interest Cover Ratio to be a reliable measure of the capacity of Australian Unity to meet its obligations to Holders under the Bonds. Australian Unity uses other financial ratios in its business, described below, and reports to investors on the basis of those ratios.

Refer to Section 3.8.2 of the Base Prospectus under the heading “Corporations Act Prescribed Ratios” for further information.

Other Relevant Financial Ratios

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Financial ratio FY13 FY14 FY15
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Covenant Gearing Ratio	34.9%	37.3%	31.5%
AU Interest Cover Ratio	3.94x	4.13x	4.57x
ADI Tier 1 Capital Ratio	16.0%	14.3%	14.2%

Impact of the ADI and Benefit Funds on prescribed Key Financial Ratios

The Australian Unity Group comprises a diversified group of businesses offering healthcare, investments, financial services and retirement solutions. It includes an ADI (Big Sky) and Benefit Funds. These are prudentially regulated businesses, and as a result their assets and revenues are not generally available to meet obligations of other parts of the Australian Unity Group.

ADIs tend to be highly leveraged with high gearing ratios, because they receive deposits, and will tend to have a low Working Capital Ratio.

ADIs and Benefit Funds earn significant interest income which normally creates negative interest cover ratios.

These outcomes are appropriate for an ADI and Benefit Funds, but distort those ratios when combined with the rest of the Australian Unity Group.

Relevance of prudential regulation

Prudential standards require Big Sky to maintain levels of capital which are designed to ensure that it can meet its liabilities from its own resources, and Big Sky’s obligations are not guaranteed by other members of the Australian Unity Group.

The Life Insurance Act restricts relevant revenues, expenses, assets and liabilities of the Benefit Funds being available to other members of the Australian Unity Group. However, the equity represented by a management fund held in the subsidiary that holds the Benefit Funds is potentially available to support other Australian Unity Group obligations, if regulatory capital requirements are met and consents obtained.

Adjustments to the prescribed Key Financial Ratios

As a result of the factors described above, Australian Unity adjusts the ratios that it uses in its business for Big Sky and the Benefit Funds.

Like many companies, Australian Unity also reflects only “interest bearing” liabilities in its gearing ratio, and makes other adjustments that were agreed when negotiating its banking facilities.

This methodology produces gearing ratios and interest cover ratios that are different to the prescribed Key Financial Ratios.

Australian Unity believes that the Covenant Gearing Ratio and the AU Interest Cover Ratio are better measures of Australian Unity’s ability to meet its obligations under the Bonds.

The Covenant Gearing Ratio

Gearing ratios focus on balance sheet positions, and measure a company’s ability to repay its debts. The Gearing Ratio is distorted by the inclusion within the Australian Unity Group of a highly leveraged entity such as an ADI.

The Covenant Gearing Ratio is the ratio referred to in the covenant in the Bonds that sets a gearing ratio limit. It is adjusted so that it indicates the level of debt ranking equally with or senior to the Bonds.

The Covenant Gearing Ratio excludes the financial position of Big Sky and the Benefit Funds, which are subject to prudential requirements, but includes the equity represented by the management fund held to support the Benefit Funds as the Benefit Funds already meet prudential requirements.

16 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

The Covenant Gearing Ratio also excludes non-interest bearing liabilities. In general, liabilities can be considered as either operational in nature or as borrowings. Non-interest bearing liabilities are excluded so that the Covenant Gearing Ratio measures the extent to which Australian Unity actively borrows in financial markets to fund its growth plans. Operational liabilities are not included in the calculation of the Gearing Ratio Debt so that it can derive a measure of the extent to which Australian Unity’s businesses are funded by borrowings. The Covenant Gearing Ratio also includes Junior Ranking Obligations (which rank below the Bonds in a winding up) as Total Equity.

More information about these adjustments to the Covenant Gearing Ratio is set out in Section 3.8.2 of the Base Prospectus.

The AU Interest Cover Ratio

Interest cover ratios focus on cashflow and measure a company’s capacity to service interest on its borrowings from its earnings, and as a result can be distorted by parts of the Australian Unity Group that earn interest income that is not readily available for that purpose.

The adjusted interest expense in the calculation of the AU Interest Cover Ratio excludes the net interest income of Big Sky and the Benefit Funds, and any interest from time to time on any loans by the management fund (described above) to the Benefit Funds.

The other businesses of Australian Unity earn interest on their cash and cash equivalent assets, and this interest income is also excluded. In the case of Australian Unity, the inclusion of net interest income from the ADI operations and Benefit Funds and other interest income results in a negative net interest expense because interest income will normally exceed interest expense. The exclusion of these interest income components provides a better insight into Australian Unity’s interest obligations.

Refer to Section 3.8.2 of the Base Prospectus under the heading “AU Interest Cover Ratio” for further information.

Details of adjustments and calculations

The method for calculating these adjusted ratios and the adjustments compared to the prescribed formulae are set out in Section 3.8.2 of the Base Prospectus, and the relevant calculations are incorporated by reference into this Offer Specific Prospectus and available at Australian Unity’s website www.australianunity.com.au/bonds.

3.5 Details of ranking and other debt on issue

Illustration of ranking upon winding up

	Type of instrument Existing debt obligations and equity Amount drawn as at 30 June 2015, adjusted for the amount to be raised under the Ofer ($230m)2
Higher ranking Lower ranking	Secured debt None (except for the 2011 Notes which will be secured on the cash proceeds of issue of the Bonds) None
	Unsubordinated unsecured debt Bank debt, Australian Unity Notes, the Bonds $0 / $60m / $230m
	Subordinated, unsecured debt and hybrid instruments None None
	Ordinary equity Members’ balances, Reserves, Retained profts $502.8m

Australian Unity currently has no secured debt (except for the security interest granted in respect of the 2011 Notes – see Section 2.1.4 of the Base Prospectus) and no unsecured debt which ranks ahead of the Bonds, however, the Bonds place only limited restrictions on Australian Unity granting security for other indebtedness (see Section 2.1.4 of the Base Prospectus). Certain subsidiaries of Australian Unity have external borrowings. The debt of Australian Unity’s subsidiaries is generally non-recourse to Australian Unity. Notwithstanding this, any default at a subsidiary level, including any ADI, may still have important consequences for Australian Unity, including the potential to reduce cash flows to Australian Unity, cause Australian Unity to extend resources supporting the subsidiary, cause a write-down in the value of Australian Unity’s investments in its subsidiaries and affect Australian

2 Discretion is reserved for the Offer size to be greater or lesser than this amount. Assumes $60 million allocated under the Reinvestment Offer and the cancellation of the same amount of 2011 notes.

17

Section three Offer specific information you should consider (continued)

Unity’s ability to obtain credit. These consequences may affect Australian Unity’s ability to meet its obligations in respect of the Bonds.

Most of Australian Unity’s claims on its Subsidiaries rank behind creditors of those Subsidiaries and the Bonds are not guaranteed by a Subsidiary so no Holder has a claim on any Subsidiary. The chart below sets out the maturity profile of Australian Unity and its Subsidiary external debt facilities including capital markets debt as at 30 June 2015. It does not include any adjustment for the issue of the Bonds or the purchase or cancellation of any 2011 Notes resulting from the offer to holders of 2011 Notes to subscribe for Bonds using proceeds from the 2011 Notes, which is described in section 4.2 (“ 2011 Reinvestment Offer ”).

Australian Unity’s existing external debt facilities and their maturities are as follows as at 30 June 2015:

Prior to the issue

FY16		18	18	18					120	9	AUL bank facility (undrawn)
FY17	15						19	16			Retirement Village Investment Notes
FY18	14										Australian Unity Notes (2011 Notes)
FY19	7										Retirement Living development finance loans
Beyond	5					30					Health Insurance subordinated capital notes
Facility									Amount drawn		Maturity
Bank facility				($15m)					$0m		March 2017
Australian Unity						Notes due 2016			$120m		April 2016

In addition, subsequent to 30 June 2015, Australian Unity has entered into an additional unsecured $100 million bank facility maturing on 4 November 2016.

The existing interest bearing debt obligations and their maturities for subsidiaries of Australian Unity are as follows as at 30 June 2015:

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Facility Amount drawn Maturity
----- End of picture text -----

Health insurance subordinated capital notes*	$30.0m	11 July 2023
Retirement Living development fnance loans	$25.3m	June 2016 to August 2017
ADI deposits (interest bearing liabilities)	$698.5m	On demand subject to notice
Retirement Village Investment Notes	$63.2m	November 2015 to December 2023
Other external loans	$5.1m	Rolling three month
Guarantees	$6.8m	December 2015 to January 2023

• First call date is 11 July 2018.

The issue of the Bonds and the cancellation of the 2011 Notes under the Reinvestment Offer will have the effect of lengthening the debt maturity profile of the Australian Unity Group. The resulting debt maturity profile may reduce Australian Unity’s exposure to refinancing risk in the coming years.

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Debt maturity profile ($ million) []
Following the issue AUL bank facility (undrawn)
FY16 18 60 9 Retirement Village Investment Notes
FY17 15 19 16 Australian Unity Notes (2011 Notes)
FY18 14 Series B Australian Unity Bond Tranche 1
FY19 7 Retirement Living development finance loans
Beyond 5 230 30 Health Insurance subordinated capital notes
----- End of picture text -----**

** Assumes $60 million allocated under the Reinvestment Offer.

18 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

3.6 Credit Rating and Product Complexity Indicator

3.6.1 About Australia Ratings

Australia Ratings was established in 2010 and is licensed by ASIC to issue Credit Ratings for use in the retail and wholesale financial markets. For more information visit www.australiaratings.com.

3.6.2 Credit Ratings

A Credit Rating is a statement, opinion or research dealing with the creditworthiness of a body or the ability of an issuer of a financial product to meet its obligations under the financial product.

Australia Ratings assigns Credit Ratings to differentiate the degree of credit worthiness of organisations and debt securities available to investors in the Australian financial market. Credit Ratings are assigned on a long-term and short-term rating scale. A long-term Credit Rating is assigned to an organisation or fixed income product where the term of the investment or financial exposure is greater than 12 months and a short-term Credit Rating is assigned where the period of the financial exposure or term of the debt security is less than 12 months.

Australia Ratings assigns long-term ratings from ‘AAA’ to ‘C’. The ratings from ‘AA’ to ‘C’ may be modified by the addition of a plus or minus sign to show relative standing within the major rating categories. Australia Ratings’ rating scale is set out below:

Creditworthiness	classifcation **Long-term categories include **	Short-term categories include
High	‘AAA’, ‘AA’, ‘A’	‘a-1’, ‘a-2’
Intermediate	‘BBB’, ‘BB’	‘a-3’
Low	‘B’, ‘CCC’, ‘CC’, ‘C’	‘b’, ‘c’

3.6.3 Product Complexity Indicators

A Product Complexity Indicator is a colour coded indicator that helps differentiate debt securities which may have similar credit attributes by highlighting to potential investors the nature of the security in terms of complexity or non-standard features that could give rise to unanticipated variability or change in the returns from the investment.

Australia Ratings assigns a Product Complexity Indicator to debt securities by using a colour spectrum similar to that used to provide warnings to the public in other non-financial circumstances (for example, bush fire warnings). Australia Ratings assigns Product Complexity Indicators ranging from ‘Green’ to ‘Red’.

3.6.4 Credit Rating assigned to the Australian Unity Bonds

Australia Ratings has assigned a long-term Credit Rating of BBB+ to the Bonds, subject to no material changes occurring to the transaction structure or documentation. According to Australia Ratings, a Credit Rating of BBB+ represents a moderate degree of creditworthiness with adequate credit attributes. A BBB+ rating represents a good capacity to meet financial obligations in a timely manner. Credit Ratings are statements of opinion, not statements of fact or recommendations to buy or hold securities. Credit Ratings may be changed, withdrawn or suspended at any time.

3.6.5 Product Complexity Indicator assigned to the Australian Unity Bonds

Australia Ratings has assigned a ‘Green’ Product Complexity Indicator to the Bonds, subject to no material changes occurring to the transaction structure or documentation.

According to Australia Ratings, a ‘Green’ Product Complexity Indicator represents a simple financial product and reflects that the terms of the Bonds are simple and straightforward for a retail investor to understand.

Product Complexity Indicators are statements of opinion, not statements of fact or recommendations to buy or hold securities. Product Complexity Indicators may be changed, withdrawn or suspended at any time.

19

Section three Offer specific information you should consider (continued)

3.6.6 Australia Ratings’ Disclaimer

Australia Ratings has made every effort to ensure the accuracy and reliability of the Credit Rating and Product Complexity Indicator as disclosed in this Offer Specific Prospectus. The Credit Rating and Product Complexity Indicator assigned are based on information provided to Australia Ratings or which was obtained from sources which it believed to be accurate and reliable at the time of the assignment of the rating. Australia Ratings does not guarantee the completeness and accuracy of the rating and it is possible that subsequent material events or information may come to light after the publication of the Credit Rating which are not known to Australia Ratings and which may have a material impact on the Credit Rating assigned.

Information in this section 3.6 has been supplied by Australia Ratings. To the extent permitted by law, Australian Unity takes no responsibility for this information.

3.7 Key risks update

A detailed outline of risks relating to Australian Unity Bonds and Australian Unity Group’s business is contained in Section 4 (“ Key risks ”) of the Base Prospectus. You should read the Base Prospectus in full before deciding whether to invest in the Bonds.

In addition to the risks described in Section 4 of the Base Prospectus, investors should consider the following risks.

3.7.1 The acquisition of Home Care NSW may not proceed

There is a risk the acquisition of Home Care NSW will not proceed due to the default of a party or a failure to meet a condition precedent to completion by either the New South Wales Government or Australian Unity, even though a binding contract exists. If the acquisition did not proceed, Australian Unity would use the proceeds from the issue of the Bonds that have not been used to refinance the 2011 Notes for general corporate purposes (as illustrated in Section 3.2). This may include paying down subsidiary level debt on issue (which is set out in Section 3.5) in the short term and funding other acquisitions and developments in the medium term.

3.7.2 The integration of Home Care NSW may not be successful

Australian Unity intends to incur indebtedness, including the Bonds and potentially additional debt facilities, to finance the acquisition of Home Care NSW. The performance of Home Care NSW after the acquisition is subject to numerous factors, including:

• retention of the customer base;

• retention of referral networks;

• retention of staff;

• integration of the workforce into the Australian Unity Group; and

• challenges arising from transition from government ownership to the Australian Unity Group.

The performance of Home Care NSW under the Australian Unity Group’s ownership may impact on Australian Unity’s ability to satisfy financial obligations under its indebtedness. Whilst the Directors of Australian Unity consider that the anticipated level of gearing following the acquisition is appropriate in the context of Australian Unity’s size, strategy and current activities, an increase in borrowings may increase financial risk and exposure to changes in interest rates. Increased gearing associated with the acquisition of Home Care NSW may constrain the ability of Australian Unity to raise additional indebtedness used to undertake acquisitions and business expansion.

3.7.3 Additional risk disclosure in relation to Credit Rating

The Credit Rating of the Bonds is subject to revision or change at any time in accordance with Australia Ratings’ methodologies and procedures, and its Australian Financial Services Licence conditions. It may change as a result of, among other things, changes in the Australian Unity Group’s operating and financial performance, capital structure or for some other reason which might not be known to Australia Ratings at the date of this Offer Specific Prospectus. The Credit Rating issued in respect of the Bonds is a statement, an opinion or research dealing with the ability of Australian Unity to meet its obligations under the Bonds, and has been based on information provided to Australia Ratings.

A downgrade of the Credit Rating indicates a deterioration in Australia Ratings’ opinion of the creditworthiness of the Bonds. A deterioration of creditworthiness could make it more difficult for Australian Unity to source or seek external funding and this

20 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

may have an adverse impact on the operating and financial performance of Australian Unity and its ability to pay Interest owed on the Bonds or the Redemption Amount due on the Bonds.

A change in the Credit Rating of the Bonds could also directly affect the market price and liquidity of the Bonds.

The Credit Rating also may not reflect the potential impact of all risks related to the Bonds, market and additional factors disclosed in section 4 of the Base Prospectus and other factors that may affect the actual value or trading value of the Bonds or Australian Unity’s financial position. The Credit Rating is not a “market” rating, nor is it a recommendation to buy, hold or sell securities (including the Bonds), in as much as it does not comment as to market price or suitability for a particular investor. Additional information on Credit Ratings can be found in Section 3.6.

3.8 Other information

3.8.1 No material breaches of loan covenants or debt obligations

Australian Unity has not materially breached any loans or debt obligations in the two years prior to the date of this Offer Specific Prospectus.

3.8.2 Base Prospectus is up-to-date

Other than the specific information contained in this Offer Specific Prospectus, all information in the Base Prospectus remains current as at the date of this Offer Specific Prospectus.

You must read the Base Prospectus in conjunction with this Offer Specific Prospectus.

3.8.3 Australian Unity Board Renewal and Refreshment

On 28 July 2015, Mr Glenn Barnes announced his intention to retire from Australian Unity’s Board of Directors with retirement taking effect on or around 31 March 2016. As at the date of this document, Mr Peter Promnitz is Deputy Chairman and ChairmanDesignate.

3.8.4 Other Important Information

The following documents have been incorporated by reference and as such form part of the Offer Specific Prospectus.

A link to the following materials is on Australian Unity’s website www.australianunity.com.au/bonds and a copy of each document can be obtained free of charge by calling the Australian Unity Bonds Information Line on 1800 550 560 (within Australia) or +61 1800 550 560 (outside Australia) Monday to Friday 8:30 am to 5:30 pm (AEDST) during the Offer Period.

• Offer Specific Terms, which were filed with ASIC on 17 November 2015. The Terms consist of the Base Terms as supplemented, amended, modified or replaced by the Offer Specific Terms;

• Consents to be named. This is a list of the consents from relevant parties that Australian Unity can name them in this Offer Specific Prospectus, filed with ASIC on 9 November 2015;

• Summary of interests and benefits. This is a summary of the interests of certain persons involved in the Offer and the fees they are being paid, including the Directors and relevant advisers, filed with ASIC on 9 November 2015. Directors are permitted to participate in the Offer; and

• Australia Ratings Financial Services Guide. This is a financial services guide supplied by Australia Ratings in respect of the credit ratings advice in this Offer Specific Prospectus, filed with ASIC on 9 November 2015. To the extent permitted by law, Australian Unity takes no responsibility for the content of the Australia Ratings Financial Services Guide.

Under the law, Australian Unity must immediately disclose any information which would have a material impact on the trading price of its debt securities. This information is publicly available through ASIC and ASX. You should consider this information when making an investment decision in relation to the Bonds.

It is important that you read the Base Prospectus and this Offer Specific Prospectus before you make any decision to invest in the Bonds.

21

Section three Offer specific information you should consider (continued)

3.8.5 Cornerstone Investor Fees

Certain Institutional Investors have, prior to the lodgement of this Offer Specific Prospectus, committed to the Joint Lead Managers to apply for Bonds on the same terms as all other investors. The Joint Lead Managers will pay these Institutional Investors (but not any other investors that subsequently gave commitments to invest under the Bookbuild) 0.50 percent of the amount they commit to which is then allocated to them.

3.8.6 Trustee’s Liability

The Trustee, being Australian Executor Trustees Limited:

• (a) has not made any statement or purported to make any statement in the Offer Documents or any statement on which a statement in the Offer Documents is based, other than as specified below;

• (b) to the maximum extent permitted by law, expressly disclaims all liability in respect of, makes no representation or any statement regarding, and takes no responsibility for, any part of the Offer Documents, or any statements in, or omissions from the Offer Documents, other than the references to its name and the statement(s) and/or report(s) (if any) specified below and included in the Offer Documents with its written consent;

• (c) has given and has not, before the lodgement of the Offer Documents with ASIC, withdrawn its written consent:

• to be named in the Offer Documents in the form and context in which it is named; and

• to the inclusion in the Offer Documents of the statement(s) and/or report(s) (if any) by that person in the form and context in which they appear in the Offer Documents;

• (d) does not, nor does any related person, make any representation as to the truth and accuracy of the contents of the Offer Documents;

• (e) has relied on Australian Unity for the accuracy of the contents of the Offer Documents; and

• (f) does not, nor does any related person, make any representation or warranty as to the performance of Bonds or the payment of interest or the redemption of Bonds.

The interest payments on Bonds are obligations of Australian Unity and are not guaranteed by the Trustee or any of its directors, employees, officers, affiliates, agents, advisers, intermediaries, related body corporate or any other entity.

The obligation to redeem Bonds in accordance with their terms is a direct obligation of Australian Unity. Neither the Trustee nor any of its directors, employees, officers, affiliates, agents, advisers, intermediaries, related body corporate or any other entity guarantees the redemption of or prepayment of any principal under Bonds.

The Trustee is not responsible for monitoring Australian Unity’s compliance with the Trust Deed nor Australian Unity’s business.

3.8.7 Trustee’s Privacy Policy

The Trustee may collect your personal information for the primary purpose of providing trustee services to Australian Unity and for ancillary purposes detailed in its privacy policy. The Trustee may disclose your personal information, such as your name and contact details, along with your account information to its related bodies corporate, Australian Unity, professional advisors, the land titles office and/or as otherwise instructed by Australian Unity. The Trustee is also permitted to collect and disclose your personal information when required or authorised to do so by law. The Trustee is not likely to disclose your personal information to overseas recipients. Your personal information will be used in accordance with the Trustee’s privacy policy. The privacy policy contains information about how you may access or correct your personal information held by the Trustee and how you may complain about a breach of the Australian Privacy Principles. You may obtain a copy of the privacy policy at www.aetlimited.com.au/privacy.

3.8.8 Acknowledgements

Each person who applies to participate in the Offer, or submits an Application Form will be deemed to have:

• acknowledged having personally received a paper or electronic copy of this Offer Specific Prospectus and the Base Prospectus (and any supplementary or replacement document) accompanying the Application Form and having read them all in full;

• acknowledged that the Applicant(s) understand the Terms and have had an opportunity to consider the suitability of an investment in the Bonds with their professional advisers;

• agreed to be bound by the Terms;

22 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

• declared that all details and statements in their Application Form are complete and accurate;

• consented to the use and disclosure of the Applicant’s(s’) personal information as described in section 5.2 of the Base Prospectus, and understood and agreed that the use and disclosure of the Applicant’s(s’) personal information applies to any personal information collected by Australian Unity and any entity in the Australian Unity Group in the course of the Applicant’s(s’) relationship with Australian Unity and any entity in the Australian Unity Group;

• declared that the Applicant(s), if a natural person, is/are over 18 years of age;

• acknowledged that once Australian Unity or the Registry receives an Application form it may not be withdrawn, except as allowed by law;

• applied for the number of Bonds at the Australian dollar amount shown on the Application Form;

• agreed to being allocated the number of Bonds applied for (or a lower number allocated in a way described in this Offer Specific Prospectus), or no Bonds at all;

• authorised Australian Unity and the Joint Lead Managers and their respective officers or agents, to do anything on the Applicant’s(s’) behalf necessary for Bonds to be allocated to the applicant(s), including to act on instructions received by the Registry upon using the contact details in the Application Form, acknowledged that the information contained in this Offer Specific Prospectus (or any supplementary or replacement document) is not investment advice or a recommendation that Bonds are suitable for the Applicant(s), given the Applicant’s(s’) investment objectives, financial situation or particular needs;

• declared that the Applicant(s) is an Australian resident or otherwise a person to whom the offer of Bonds can be made, and Bonds issued, in accordance with Section 4.1 of this Offer Specific Prospectus;

• acknowledged that Bonds have not been, and will not be, registered pursuant to the securities laws of any other jurisdiction outside Australia; and

• acknowledged that Bonds are not protected accounts, bank deposit liabilities or policy liabilities of Australian Unity or any member of the Australian Unity Group and are not protected accounts under the Banking Act or policies with any member of the Australian Unity Group under the Life Insurance Act and that investments are subject to investment risk, including possible delays in repayment and loss of income and principal invested.

23

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Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

A

Section Four

How to apply

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25

Section four How to apply

4.1 Applying for the Bonds

You may apply for the Bonds under one of the following Offer:

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Offer tranches Who can Apply When to Apply How to Apply
----- End of picture text -----

Member Ofer	Eligible Members	Applications will only be accepted during	You can apply online at
		the Ofer Period, which is expected to	www.australianunity.com.au/bonds
		commence on 17 November 2015. The Closing Date for the Member Ofer is 4 December 2015.	Instructions on how to complete your Application are provided online.
		Your online Application or paper Application Form must be completed and Application Monies must be received by the Registry by the Closing Date.	You will be required to provide your entitlement number which gives you the entitlement to apply under the Member Ofer.
			Should you wish to apply by paper
			Application, you can request a free paper
			copy of the Ofer Documents and a Member
			Ofer Application Form or by contacting the
			Australian Unity Bonds Information Line on
			1800 550 560 (within Australia) or +61 1800
			550 560 (International) Monday to Friday
			8:30 am to 5:30 pm (AEDST) during the Ofer
			Period. You will be required to provide your
			Member entitlement number. Instructions
			on how to complete the Member Ofer
			Application Form are set out in the form.
			When applying via a paper Member Ofer
			Application Form you may pay for the Bonds
			using cheque(s) and/or money order(s). Your
			completed Member Ofer Application Form
			and Application Payment must be received
			by the Registry by the Closing Date for the
			Member Ofer which is 5:00 pm (AEDST) on
			4 December 2015.
Institutional Ofer	Institutional	Institutional investors should contact	Applications and settlement procedures
	Investors – that is an	the Joint Lead Managers for instructions	for Institutional Investors will be advised
	investor who was	on participating in the Ofer.	by the Joint Lead Managers.
	invited by the Joint
	Lead Managers to
	bid for the Bonds,
	who is a Broker Firm
	Ofer Applicant
Broker Firm Ofer	Australian resident	Applications will only be accepted during	You must contact your Syndicate Broker for
	retail clients of a	the Ofer Period, which is expected to	instructions about how to complete your
	Syndicate Broker	commence on 17 November 2015.	Application.
	invited by the Syndicate Broker to participate through	The Closing Date for the Broker Firm Ofer is 11 December 2015.	You must not return your Application to the Registry or Australian Unity.
	the Broker Firm Ofer	Your completed Broker Firm Ofer
		Application Form and Application Monies
		must be received by your Syndicate Broker
		in accordance with arrangements made
		between you and your Syndicate Broker.

26 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

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Offer tranches Who can Apply When to Apply How to Apply
----- End of picture text -----

Reinvestment Ofer	Eligible Australian	Completed Reinvestment Ofer Application	You can apply online at
	Unity 2011 Notes	Forms must be received by the Registry by	www.australianunity.com.au/bonds
	holders (see Section 4.2(a))	the Closing Date for the Ofer, which is expected to be 5:00 pm (AEDST) on 4 December 2015 (in either hard copy	Instructions on how to complete your Application are provided online.
		or online).	You will be required to provide your
		If you are a client of a Syndicate Broker, you should contact your Syndicate Broker for information about participating in the	entitlement number which gives you the entitlement to apply under the Reinvestment Ofer.
		Reinvestment Ofer.	Should you wish to apply by paper
			Application, you can request a free paper
			copy of the Ofer Documents and a
			Reinvestment Ofer Application Form or
			by contacting the Australian Unity
			Bonds Information Line on 1800 550 560
			(within Australia) or +61 1800 550 560
			(International) Monday to Friday 8:30
			am to 5:30 pm (AEDST) during the Ofer
			Period. You will be required to provide
			your entitlement number. Instructions
			on how to complete the Reinvestment
			Ofer Application Form are set out in
			the form. Your completed Reinvestment
			Ofer Application Form must be received
			by the Registry by the Closing Date for
			the Reinvestment Ofer which is 5:00 pm
			(AEDST) during the Ofer Period on
			4 December 2015.

4.2 2011 Notes Reinvestment Offer

The 2011 Notes are unsecured and unsubordinated debt securities which were issued by Australian Unity to retail investors in 2011. The 2011 Notes trade on ASX under the code ”AYUHA”.

(a) Eligibility to participate in the Reinvestment Offer

The following holders of the 2011 Notes are eligible to participate in the Reinvestment Offer (“ Eligible 2011 Notes holders ”):

• registered holders of the 2011 Notes trading on ASX at 7:00 pm (AEDST) on 5 November 2015 (the “ Reinvestment Record Date ”);

• holders who are shown on the register of holders of 2011 Notes as having an address in Australia (or another jurisdiction to which Australian Unity determines to extend the Reinvestment Offer); and

• holders who are not in the United States or a US Person, acting as a nominee for, or for the account or benefit of, a US Person, and who are not otherwise prevented from receiving the Offer under the laws of any jurisdiction as determined by Australian Unity.

(b) What is the Reinvestment Offer?[3]

The Reinvestment Offer is an offer available to Eligible 2011 Notes holders to apply for Bonds and fund their subscription for Bonds by selling to Australian Unity some or all of their 2011 Notes.

2011 Notes which are not sold to Australian Unity under the Reinvestment Offer will be redeemed for cash on 14 April 2016 (the scheduled maturity date of the 2011 Notes) at which time holders of 2011 Notes who do not participate in the Reinvestment Offer will receive the face value plus any accrued and unpaid interest to that date for each 2011 Note held.

3 Note – Australian Unity has obtained certain technical ASIC relief from Division 5A of Part 7.9 of the Corporations Act in relation to the Reinvestment Offer.

27

Section four How to apply (continued)

The Reinvestment Offer is not a simple rollover into a similar investment. The 2011 Notes and the Bonds, while having a number of similar features, have different benefits and risks, which must be evaluated independently (see section (f) below). The key differences include the following:

• The current margin on the 2011 Notes is 3.55 percent per annum. As a consequence of the change in market conditions since 2011 when the 2011 Notes were issued, the Margin for the Bonds (2.80 percent) is less than the margin on the 2011 Notes.

• The level of gearing (calculated in accordance with the Covenant Gearing Ratio) that Australian Unity will undertake not to exceed under the Bonds is 50 percent, as opposed to 45 percent under the 2011 Notes and there have been changes to the definition of equity which broaden it to include obligations which are subordinated to the Bonds (of which there are currently none).

• There is a less restrictive negative pledge in the Bonds (compared with the 2011 Notes).

• The Maturity Date for the Bonds is 15 December 2020. The maturity date for the 2011 Notes is 14 April 2016.

Eligible 2011 Notes holders who elect to participate in the Reinvestment Offer will sell their 2011 Notes to Australian Unity for $100 plus the “Accrued Interest Amount” and the “Further Amount” per 2011 Note sold to Australian Unity.

The “Accrued Interest Amount” is an amount per 2011 Note payable to each Eligible 2011 Note holder who elects to participate in the Reinvestment Offer in compensation for the interest the holder would have received for the 62 day period from (and including) 14 October 2015 to (but excluding) the Issue Date for the Bonds (the “ Stub Period ”). The Accrued Interest Amount will be calculated on the basis of the market rate applicable to the 2011 Notes on 14 October 2015 plus a margin of 3.55 percent per annum for the Stub Period. Assuming the Issue Date is 15 December 2015 and based on an interest rate applicable to the Stub Period of 5.70 percent per annum, the Accrued Interest Amount would be $0.9682 per 2011 Note.

The “Further Amount” is an amount per 2011 Note payable to each Eligible 2011 Notes holder who elects to participate in the Reinvestment Offer in compensation for the difference in margin between the 2011 Notes and the Bonds for the period from the Issue Date to the 2011 Notes maturity date. Assuming the Issue Date is 15 December 2015 and based on a Margin on the Bonds of 2.80 percent per annum and the margin on the 2011 Notes being 3.55 percent per annum, the Further Amount would be $0.2486 per 2011 Note.

$100 of the proceeds of the sale of a 2011 Note to Australian Unity will be applied to fund the subscription for a Bond and the participating Eligible 2011 Notes holder will receive an amount per 2011 Note sold equal to the sum of the Accrued Interest Amount and the Further Amount.

(c) Options available to Eligible 2011 Notes holders

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Option Action Eligible 2011 Notes holders may take to implement their preferred option
----- End of picture text -----

Option 1 – Apply under the	If you are an Eligible 2011 Notes holder, you may sell all of the 2011 Notes you held on the
Reinvestment Ofer to sell all	Reinvestment Record Date to Australian Unity to fund your subscription for Bonds.
of your 2011 Notes to fund your subscription for Bonds	To choose this option, you must select ‘Option A – Full Reinvestment’ on your personalised paper or online Reinvestment Ofer Application Form.
	If you hold a greater or lesser number of 2011 Notes than shown on the personalised Reinvestment
	Ofer Application Form, and you select the full reinvestment option, you will be taken to have
	applied for the sale to Australian Unity of the lower of the number of 2011 Notes specifed on your
	personalised Reinvestment Ofer Application Form and the number of 2011 Notes registered in your
	name on the Closing Date of the Ofer, expected to be 4 December 2015.
	In addition to participating in the Reinvestment Ofer, an Eligible 2011 Notes holder wishing
	to increase its investment may apply for Bonds under the Member Ofer (if an Eligible Member)
	or the Broker Firm Ofer (if a client of a Syndicate Broker).

28 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

Option 2 – Apply under	If you are an Eligible 2011 Notes holder, you may choose to sell only some of the 2011 Notes you
the Reinvestment Ofer	held on the Reinvestment Record Date to Australian Unity to fund your subscription for Bonds.
to sell only some of your 2011 Notes to fund your subscription for Bonds	To choose this option, you must select ‘Option B – Partial Reinvestment’ and specify the number of 2011 Notes to be sold to Australian Unity on your personalised paper or online Reinvestment Ofer Application Form.
	If you own 50 2011 Notes or fewer, you must apply to sell all of your 2011 Notes to Australian Unity
	to participate in the Reinvestment Ofer. If you own more than 50 2011 Notes, you must apply to sell
	a minimum of 50 2011 Notes to Australian Unity to participate in the Reinvestment Ofer.
	If you hold a lesser number of 2011 Notes than you elect to sell to Australian Unity on your
	personalised Reinvestment Ofer Application Form, you will be taken to have applied for the sale of
	the lower of the number of 2011 Notes you held on the Reinvestment Record Date and the number
	of 2011 Notes registered in your name on the Closing Date of the Reinvestment Ofer, expected to
	be 4 December 2015.
Option 3 – Sell your	You may choose to sell or dispose of your 2011 Notes on market (in which case, you may have to pay
2011 Notes on market	brokerage) at the prevailing market price, which may be higher or lower than the price you would
	receive if you were to sell all your 2011 Notes to Australian Unity through the Reinvestment Ofer
	and use the proceeds as you determine. To choose this option, you should contact your broker.
	If you sell your 2011 Notes on market and use the proceeds to apply for Bonds, you will need to
	apply under the Member Ofer or Broker Firm Ofer and there is a risk you may not receive the level
	of allocation you may have through participation in the Reinvestment Ofer.
	The market price of 2011 Notes is subject to change from time to time. As at the close of trading
	on 6 November 2015, the market price per 2011 Note was $101. Up-to-date information about the
	market price of 2011 Notes can be obtained from asx.com.au (ASX code ”AYUHA”).
	If you sell your 2011 Notes on market you may have to pay brokerage and your ability to sell and the
	price at which you sell your 2011 Notes depends on the liquidity of the market and the trading price
	at that time.
Option 4 – take no action	You are not required to participate in the Reinvestment Ofer, or to sell your 2011 Notes on market
	and as such, you are not required to take any action.

(d) Eligible 2011 Notes holders who are also clients of Syndicate Brokers

Eligible 2011 Notes holders who are an Australian resident client of a Syndicate Broker may apply for Bonds through the Reinvestment Offer under the Broker Firm Offer. You should contact your Syndicate Broker for instructions on how to apply under the Broker Firm Offer.

(e) Ineligible holders of 2011 Notes

If you are a holder of the 2011 Notes with a registered address outside Australia on the Reinvestment Record Date (or you otherwise do not fulfil the requirements set out in section (a) above), then you are ineligible to participate in the Reinvestment Offer. In these circumstances, you are limited to Options 3 or 4 in the table in section (c) above.

(f) Comparison between 2011 Notes and Bonds

There are a number of key differences between 2011 Notes and Bonds. A comparison of the key features of 2011 Notes and Bonds is set out in summary form below. This comparison is not exhaustive.

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Feature 2011 Notes Bonds
----- End of picture text -----

Issuer	Australian Unity Limited	Australian Unity Limited
Guarantor	None	None
Legal form	Unsecured debt obligations	Unsecured debt obligations
Issue Price	$100 per 2011 Note	$100 per Bond
Term	5 years	5 years
Early redemption	Yes, for taxation or regulatory reasons on a change of	Yes, for taxation reasons, on a change of
(at Issuer’s option)	control or if less than 10% remain on issue	control or if less than 10% remain on issue

29

Section four How to apply (continued)

Margin	3.55%	2.80%
Interest rate	Floating	Floating
Interest payments	Mandatory, not deferrable	Mandatory, not deferrable
Payment frequency	Quarterly	Quarterly
Transferable	Yes – quoted on ASX	Yes – to be quoted on ASX
Gearing covenant	45%, although the trustee of the 2011 Notes has	50% (and there are changes to the basis
	agreed to an amendment to the gearing covenant	of computation of the covenant)
	so that the cash proceeds of the Bonds (which would
	otherwise adversely afect the gearing covenant) are
	carved out of the gearing ratio —security is being
	granted by Australian Unity to the trustee, The Trust
	Company (Australia) Limited over the bank account
	into which those cash proceeds will be deposited
	(until any 2011 Notes which remain on issue have
	been paid out)
Negative Pledge	Yes	Yes (but less restrictive on Australian Unity
		than in 2011 Notes – it only applies to
		similar capital markets indebtedness and
		indebtedness owing under syndicated or
		term loan arrangements)
Restrictions on subsidiary	Yes	Yes
indebtedness
Holder early redemption	Only on a Delisting Event—redemption occurs	Only on a change of control of Australian
rights	automatically on a change of control	Unity (and provided that a Holder
		Resolution is passed in favour of requiring
		redemption)

(g) Risks associated with participating in the Reinvestment Offer

Once you apply to participate in the Reinvestment Offer, you will not be able to sell your 2011 Notes on market. If you apply to participate in the Reinvestment Offer, it is your responsibility to ensure that you do not sell or dispose of any of those 2011 Notes in respect of which you have applied to participate, other than as part of the Reinvestment Offer.

If you apply to participate in the Reinvestment Offer you are taken to agree to a holding lock being placed on the 2011 Notes you have elected to sell, pending completion of the Reinvestment Offer—but it is your obligation to ensure that you do not transfer those 2011 Notes. If you do, the number of Bonds you may be allocated will be reduced to the extent the required number of 2011 Notes are not available on the Closing Date of the Reinvestment Offer.

Once you have submitted an Application Form under the Reinvestment Offer, you will not be able to successfully deal with those 2011 Notes unless the holding lock which will be placed on those 2011 Notes is released (which will only occur if the Offer does not proceed).

If you elect to participate in the Reinvestment Offer but the Offer (including the Reinvestment Offer) does not proceed, those 2011 Notes that you elected to sell to Australian Unity to fund a subscription for Bonds will be released from the holding lock as soon as practicable.

Once released, you may sell your 2011 Notes on ASX at the prevailing market price subject to the liquidity of that market. Any application payment in respect of additional Bonds will be refunded to you. 2011 Notes not sold to Australian Unity under the Reinvestment Offer (and not sold on the ASX) will remain outstanding until redeemed by Australian Unity in April 2016.

(h) Brokerage and stamp duty

No brokerage or stamp duty is payable on the sale of your 2011 Notes to Australian Unity under the Reinvestment Offer or on your Application for Bonds. 2011 Notes holders who choose to sell their 2011 Notes on market may be required to pay any applicable brokerage.

30 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

4.3 Minimum application

The amount you have to pay for each Bond is $100. The minimum application size for Applicants under the Institutional Offer and Broker Firm Offer is 50 Bonds ($5,000). The minimum application size for Applicants under the Member Offer is 20 Bonds ($2,000).

4.4 No brokerage or stamp duty

You do not have to pay brokerage or stamp duty on your Application for Bonds. However, you may have to pay brokerage (and applicable GST) on any subsequent purchases or sales of Bonds on the ASX.

4.5 Exposure Period

The Corporations Act prohibits Australian Unity from processing Applications to subscribe for Bonds under the Offer Documents in the seven day period after the lodgement date of the Original Offer Specific Prospectus (“Exposure Period”). This period may be extended by ASIC by up to a further seven days.

This period is to enable the Original Offer Specific Prospectus (and the Base Prospectus) to be examined by market participants prior to the raising of funds. Applications received during the Exposure Period will not be processed until after the expiry of that period. No preference will be conferred on Applications received during the Exposure Period.

4.6 Allocation policy and refunds

Bookbuild

The Joint Lead Managers have conducted a Bookbuild to determine the Margin and firm allocations of Bonds to Bookbuild participants. The Bookbuild was conducted on 16 November 2015 in accordance with the terms and conditions agreed by Australian Unity and the Joint Lead Managers. As part of the Bookbuild, certain Institutional Investors and Syndicate Brokers were invited to lodge bids for Bonds. On the basis of those bids, Australian Unity, in consultation with the Joint Lead Managers, has determined the Margin (2.80 percent) and the firm allocations of Bonds to Syndicate Brokers and Institutional Investors. A total of approximately $229.8 million of Bonds were allocated under the Bookbuild. Bonds allocated during the Bookbuild will be issued under this Offer Specific Prospectus.

Member Offer

If possible, having regard to the total level of Applications under the Offer, Australian Unity will endeavour to provide Applicants under the Member Offer with an Allocation of at least 100 Bonds or such lesser amount as is applied for. However, Australian Unity does not guarantee any minimum Allocation under the Member Offer and the extent of any Allocation will ultimately depend on the total level of Applications under the Offer and the level of applications under the Reinvestment Offer.

Australian Unity has the absolute discretion to determine the method and extent of the Allocation to Applicants under the Member Offer.

In particular, Australian Unity, in consultation with the Joint Lead Managers, reserves the right (at its discretion) to:

• allocate to any Eligible Member all Bonds for which they have applied; or

• allocate to any Eligible Member a lesser number of Bonds for which they have applied, or none at all.

Broker Firm Offer

If you have applied under the Broker Firm Offer, your Syndicate Broker is responsible for determining your Allocation from their Broker Firm Allocation. Australian Unity takes no responsibility for any allocation, scale-back or rejection that is decided by your Syndicate Broker.

31

Section four How to apply (continued)

Institutional Offer

Allocations to Institutional Investors have been determined by Australian Unity in consultation with the Joint Lead Managers following the Bookbuild.

Reinvestment Offer

Applications under the Reinvestment Offer will be treated with priority when received, but may be limited by the overall size of the Offer and any earlier allocations of Bonds under the Bookbuild.

Refunds

Until the Bonds are Issued, Australian Unity will hold the Application Monies in a trust account. The account will be established and kept solely for the purpose of depositing Application Monies and dealing with those funds.

If you are not Allocated any Bonds or less than the number of Bonds you applied for, you will receive a refund cheque as soon as practicable after the Closing Date. No interest will be payable on Application Monies which are refunded. Any interest earned in the trust will be retained by Australian Unity.

4.7 Issue and quotation of Bonds

It is expected that the Bonds will be quoted on the ASX under the ASX code AYUHB. If ASX does not grant permission for the Bonds to be quoted by the Issue Date, the Bonds will not be Issued and all Application Monies will be refunded (without interest) as soon as practicable.

4.8 Trading and Holding Statements

(a) Commencement of trading of Bonds on ASX

It is expected that the Bonds will begin trading on ASX on a deferred settlement basis on Wednesday, 16 December 2015. Trading on a deferred settlement basis occurs when Holding Statements have not yet been despatched and it is not possible to settle trades on a trade date plus three business days (T+3) basis. The trade is settled on a date specified by ASX.

It is expected that the Bonds will begin trading on ASX on a normal settlement basis on 18 December 2015.

It is your responsibility to determine your holding of Bonds before trading to avoid the risk of selling Bonds you do not own. You should check your holding by asking your broker or by calling Link Market Services.

(b) Holding Statements

Australian Unity will apply for the Bonds to participate in CHESS and, if accepted, no certificates will be issued. Instead, a Holding Statement will be mailed to Holders. If your holding of the Bonds changes, you will receive an updated Holding Statement.

(c) Provision of TFN and/or ABN

When your Holding Statement is mailed, you will also be mailed a form on which to provide your TFN and/or ABN should you wish to do so (see Section 5.1.8 (“ Provision of TFN and/or ABN ”) of the Base Prospectus).

(d) Provision of bank account details for payments

Interest will be paid in Australian dollars by direct credit into nominated Australian financial institution accounts (excluding credit card accounts), for Holders with a registered address in Australia. For all other Holders, Interest will be paid by Australian dollar cheque. When your Holding Statement is mailed, you will also be mailed a form on which to provide your bank account details for payments of Face Value and Interest.

32 PART A Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

Corporate directory

Registered Office of the Issuer

Australian Unity Limited 114 Albert Road South Melbourne VIC 3205 www.australianunity.com.au

Trustee

Arrangers and Joint Lead Managers

Evans and Partners Pty Ltd Mayfair Building, 171 Collins Street Melbourne VIC 3000

National Australia Bank Limited Level 25, 255 George Street Sydney NSW 2000

Australian Executor Trustees Limited Level 22 207 Kent Street Sydney NSW 2000

Legal Adviser

King & Wood Mallesons Level 61, Governor Phillip Tower 1 Farrer Place Sydney NSW 2000

Auditors

Ernst & Young Level 23, 8 Exhibition Street Melbourne VIC 3000

Joint Lead Manager

ANZ Securities Limited Level 9, 833 Collins Street Docklands VIC 3008

Co-Manager

Australian Unity Funds Management Limited 114 Albert Road South Melbourne VIC 3205

Registry

Link Market Services Limited Level 1, 333 Collins Street Melbourne VIC 3000

Co-Manager

JBWere Limited Level 16, 101 Collins Street, Melbourne VIC 3000

Australian Unity Bonds Information Line

1800 550 560 (within Australia) +61 1800 550 560 (outside Australia) 8:30 am to 5:30 pm (AEDST), Monday to Friday during the Offer Period

Website

www.australianunity.com.au/bonds

33

This page is intentionally blank

Offer Specific Prospectus for the issue of Series B Australian Unity Bonds – Tranche 1

All Registry communications to: Link Market Services Limited Locked Bag A14 Sydney South NSW 1235 Australia Telephone (free call within Australia): +61 1800 550 560 ASX Code: AYU Website: www.linkmarketservices.com.au

==> picture [43 x 37] intentionally omitted <==

Australian Unity Limited ABN 23 087 648 888

X99999999999

SRN/HIN:

Number of 2011 Notes held as at 7:00pm (AEDST) on 5 November 2015: [XXXXXXXX]

Offer Closes 5:00pm (AEDST): 4 December 2015

REINVESTMENT OFFER APPLICATION FORM

IMPORTANT NOTICE: Use this notice only if you wish to participate in the Reinvestment Offer and apply for Bonds in Australian Unity. If you do not understand this form, you should seek appropriate independent financial advice.

A Election to participate in the Reinvestment Offer

Option A – Full Reinvestment

OR Option B – Partial Reinvestment For Option B, please write the number of 2011 Notes in the box provided. You cannot choose this option if you hold less than 50 2011 Notes. If you hold less , , than 50 2011 Notes, then you must choose Option A.

If you do not wish to participate in the Reinvestment Offer, then you do not need to take any action.

B Contact Details

Please provide a daytime telephone number where we can contact you, if we have any questions about this application.

Daytime telephone number Contact name (PRINT)

( )

==> picture [233 x 35] intentionally omitted <==

C Signature(s) of Securityholder(s) – This must be completed

Securityholder 1 (Individual) Joint Securityholder 2 (Individual) Joint Securityholder 3 (Individual) Sole Director and Sole Company Secretary Director/Company Secretary (Delete one) Director Date

This form must be signed by the securityholder. If a joint holding, all securityholders should sign. If signed by the securityholder’s attorney, the power of attorney must have been previously noted by the registry or a certified copy attached to this form. If executed by a company, the form must be executed in accordance with the company’s constitution and the Corporations Act 2001 (Cth).

==> picture [148 x 37] intentionally omitted <==

AYU REI001

HOW TO COMPLETE THIS REINVESTMENT OFFER APPLICATION FORM

This Reinvestment Offer Application Form relates to the Reinvestment Offer by Australian Unity Limited (Australian Unity) of Series B Australian Unity Bonds – Tranche 1 (Bonds) made under the Prospectus lodged with the Australian Securities and Investments Commission (ASIC) on 9 November 2015 (and any replacement or supplementary prospectus). The Prospectus will expire 13 months after the date of the Prospectus. In accordance with the Corporations Act 2001 (Cth), this Reinvestment Offer Application Form must not be distributed unless included in, or accompanied by, the Prospectus. Capitalised terms have the same meaning given to them in the Prospectus.

If you are in doubt as to how to deal with this Reinvestment Offer Application Form, please contact your accountant, lawyer, stockbroker or other professional adviser without delay. The Prospectus contains information relevant to a decision to invest in Bonds and you should read the entire Prospectus carefully before participating in the Reinvestment Offer.

While the Prospectus is current, Australian Unity will send paper copies of the Prospectus, any supplementary document and the Reinvestment Offer Application Form, free of charge on request.

Registration name and securityholder details

The Bonds will be registered in the name(s) printed on this Reinvestment Offer Application Form. Please check the details provided and update your address via Link Market Services if any of the details are incorrect.

A Election to participate in the Reinvestment Offer

• Under the Reinvestment Offer, you may elect to sell some or all of your 2011 Notes to fund your subscription for Bonds. If you choose not to participate in the Reinvestment Offer, then you do not need to take any action.

Option A – Full Reinvestment

Under the Reinvestment Offer, you may sell all of the 2011 Notes you held at 7:00pm (AEDST) on 5 November 2015 (Reinvestment Record Date) to Australian Unity to fund your subscription for Bonds.

To choose this option, mark Option A overleaf.

If you hold a greater or lesser number of 2011 Notes than shown on this Reinvestment Offer Application Form, and you select Option A overleaf, you will be taken to have applied for the sale to Australian Unity of the lower of the number of 2011 Notes specified on this Reinvestment Offer Application Form and the number of 2011 Notes registered in your name at 5:00pm (AEDST) on 4 December 2015 (Closing Date of the Reinvestment Offer).

Option B – Partial Reinvestment

Under the Reinvestment Offer, you may choose to sell only some of the 2011 Notes you held on the Reinvestment Record Date to Australian Unity to fund your subscription for Bonds. To choose this option, you must specify the number of 2011 Notes to be sold in Option B overleaf.

If you own 50 2011 Notes or fewer, you must apply to sell all of your 2011 Notes to Australian Unity to participate in the Reinvestment Offer. If you own more than 50 2011 Notes, you must apply to sell a minimum of 50 2011 Notes to Australian Unity to participate in the Reinvestment Offer.

If you hold a lesser number of 2011 Notes than you elect to sell to Australian Unity on this Reinvestment Offer Application Form, you will be taken to have applied for the sale of the lower of the number of 2011 Notes you held on the Reinvestment Record Date and the number of 2011 Notes registered in your name on the Closing Date of the Reinvestment Offer.

B Contact Details

Please provide a daytime telephone number in case we need to contact you in relation to your Reinvestment Offer.

C Signing Instructions: This form should be signed by the securityholder

• a) If a joint holding, all securityholders should sign.

• b) If signed by the securityholder’s attorney, the power of attorney must have been previously noted by the registry or a certified copy attached to this form.

• c) If executed by a company, the form must be executed in accordance with the company’s constitution and the Corporations Act 2001 (Cth) (or foreign companies, the laws in the relevant jurisdictions).

LODGEMENT INSTRUCTIONS

All Reinvestment Offer Application Forms must be received by the Registry by 5:00pm (AEDST) on 4 December 2015.

Mailing Address Hand Delivery Australian Unity Limited Australian Unity Limited C/- Link Market Services Limited C/- Link Market Services Limited Locked Bag A14 1A Homebush Bay Drive Sydney South NSW 1235 Rhodes NSW 2138 (Please do not use this address for mailing purposes)

Personal Information Collection Notification Statement: Personal information about you is held on the public register in accordance with Chapter 2C of the Corporations Act 2001. For details about Link Group’s personal information handling practices including collection, use and disclosure, how you may access and correct your personal information and raise privacy concerns, visit our website at www.linkmarketservices.com.au for a copy of the Link Group condensed privacy statement, or contact us by phone on +61 1800 502 355 (free call within Australia) 9am–5pm (Sydney time) Monday to Friday (excluding public holidays) to request a copy of our complete privacy policy.

Broker Code

Adviser Code

Australian Unity Limited ABN 23 087 648 888

==> picture [42 x 38] intentionally omitted <==

Member Offer Application Form

	Bonds applied for	Bonds applied for			Price per Bond		Application Monies	Application Monies
A	,		,	at	A$100.00	B A$	,		,	.
	(minimum	20)

PLEASE COMPLETE YOUR DETAILS BELOW (refer overleaf for correct forms of registrable names) Applicant #1 Surname/Company Name

+

C

D

Title First Name	Middle Name	Middle Name
Joint Applicant #2
Surname
Title First Name	Middle Name
Designated account e.g. (or Joint Applicant #3)
TFN/ABN/Exemption Code
First Applicant Joint Applicant #2			Joint Applicant #3
TFN/ABN type – if NOT an individual, please mark the appropriate box	Company		Partnership	Trust	Super Fund

PLEASE COMPLETE ADDRESS DETAILS

PO Box/RMB/Locked Bag/Care of (c/-)/Property name/Building name (if applicable)

E

Unit Number/Level	Street Number	Street Name
Suburb/City or Town				State	Postcode
Email address (only for purpose of electronic communication of Bondholder information)

CHESS HIN (if you want to add this holding to a specific CHESS holder, write the number here)

F X

+

Please note: that if you supply a CHESS HIN but the name and address details on your Member Offer Application Form do not correspond exactly with the registration details held at CHESS, your Application will be deemed to be made without the CHESS HIN and any Bonds issued as a result of the Offer will be held on the issuer sponsored sub-register.

Telephone Number where you can be contacted during Business Hours Contact Name (PRINT)

G ( )

Cheques or bank drafts should be made payable to “[Account Name]” in Australian currency and crossed “Not Negotiable”.

H

Cheque or Bank Draft Number BSB Account Number Total Amount A$ , , .

==> picture [32 x 41] intentionally omitted <==

LODGEMENT INSTRUCTIONS

You must return your application so it is received before 5:00pm (AEDST) on 4 December 2015 to: Link Market Services Limited, Locked Bag A14, Sydney South NSW 1235.

AYU IPO001

Your Guide to the Member Offer Application Form

This Member Offer Application Form relates to the Member Offer by Australian Unity Limited (Australian Unity) of Series B Australian Unity Bonds – Tranche 1 (Bonds) made under the Prospectus lodged with the Australian Securities and Investments Commission (ASIC) on 9 November 2015 (and any replacement and supplementary prospectus). The Prospectus will expire 13 months after the date of the Prospectus. In accordance with the requirements of the Corporations Act 2001 (Cth), this Member Offer Application Form must not be distributed unless included in, or accompanied by, the Prospectus. Capitalised terms have the meaning given to them in the Prospectus.

If you are in doubt as to how to deal with this Member Offer Application Form, please contact your accountant, lawyer, stockbroker or other professional adviser without delay. The Prospectus contains information relevant to a decision to invest in Bonds and you should read the entire Prospectus carefully before applying for Bonds.

While the Prospectus is current, Australian Unity will send paper copies of the Prospectus, any supplementary document and the Member Offer Application Form, free of charge on request.

Please complete all relevant white sections of the Member Offer Application Form in BLOCK LETTERS, using black or blue ink. These instructions are cross-referenced to each section of the form.

• A Insert the number of Bonds you wish to apply for. The Application must be for a minimum of 20 Bonds. Australian Unity will endeavor to provide Applicants under the Member Offer with an Allocation of at least 100 Bonds or such lesser amount as applied for.

• B Insert the relevant amount of Application Monies. To calculate your Application Monies, multiply the number of Bonds applied for by the issue price. Amounts should be in Australian dollars. Please make sure the amount of your cheque or bank draft equals this amount.

• C Write the full name you wish to appear on the register of Bonds. This must be either your own name or the name of a company. Up to three joint Applicants may register. You should refer to the table below for the correct registrable title.

• D Enter your Tax File Number (TFN) or exemption category. Business enterprises may alternatively quote their Australian Business Number (ABN). Where applicable, please enter the TFN or ABN for each joint Applicant. Collection of TFN(s) and ABN(s) is authorised by taxation laws. Quotation of TFN(s) and ABN(s) is not compulsory and will not affect your Application. However, if these are not provided, Australian Unity will be required to deduct tax at the highest marginal rate of tax (including the Medicare Levy) from payments.

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

• F If you are already a CHESS participant or sponsored by a CHESS participant, write your Holder Identification Number (HIN) here. If the name or address recorded on CHESS for this HIN is different to the details given on this form, your Bonds will be issued to Australian Unity’s issuer sponsored subregister.

• G Please enter your telephone number(s), area code and contact name in case we need to contact you in relation to your Application.

• H Please complete the details of your cheque or bank draft in this section. The total amount of your cheque or bank draft should agree with the amount shown in section B.

• Make your cheque or bank draft payable to “[Account Name]” in Australian currency and cross it “Not Negotiable”. Your cheque or bank draft must be drawn on an Australian bank. Sufficient cleared funds should be held in your account, as cheques returned unpaid are likely to result in your Application being rejected.

• If you receive a firm allocation of Bonds from your Broker make your cheque payable to your Broker in accordance with their instructions.

LODGEMENT INSTRUCTIONS

This Member Offer Application Form and your cheque or bank draft must be mailed or delivered so that it is received before 5:00pm (AEDST) on 4 December 2015 at:

Mailing Address	Hand Delivery
Australian Unity Limited	Australian Unity Limited
C/- Link Market Services Limited	C/- Link Market Services Limited
Locked Bag A14	1A Homebush Bay Drive
Sydney South NSW 1235	Rhodes NSW 2138(do not use this address for mailing purposes)

PERSONAL INFORMATION COLLECTION NOTIFICATION STATEMENT

Personal information about you is held on the public register in accordance with Chapter 2C of the Corporations Act 2001. For details about Link Group’s personal information handling practices including collection, use and disclosure, how you may access and correct your personal information and raise privacy concerns, visit our website at www.linkmarketservices.com.au for a copy of the Link Group condensed privacy statement, or contact us by phone on +61 1800 502 355 (free call within Australia) 9am–5pm (Sydney time) Monday to Friday (excluding public holidays) to request a copy of our complete privacy policy.

CORRECT FORMS OF REGISTRABLE NAMES

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

Type of Investor	Correct Form of Registration	Incorrect Form of Registration
Individual Usegiven names in full,not initials	Mrs Katherine Clare Edwards	K C Edwards
Company Use Company’s full title,not abbreviations	Liz Biz Pty Ltd	Liz Biz P/L or Liz Biz Co.
Joint Holdings Use full and complete names	Mr Peter Paul Tranche & Ms Mary Orlando Tranche	Peter Paul & Mary Tranche
Trusts Use the trustee(s) personal name(s)	Mrs Alessandra Herbert Smith	Alessandra Smith Family Trust
Deceased Estates Use the executor(s) personal name(s)	Ms Sophia Garnet Post & Mr Alexander Traverse Post	Estate of late Harold Post or Harold Post Deceased
Minor (a person under the age of 18 years) Use the name of a responsible adult with an appropriate designation	Mrs Sally Hamilton	Master Henry Hamilton
Partnerships Use the partners’ personal names	Mr Frederick Samuel Smith & Mr Samuel Lawrence Smith	Fred Smith & Son
Long Names	Mr Hugh Adrian John Smith-Jones	Mr Hugh A J Smith Jones
Clubs/Unincorporated Bodies/Business Names Use offce bearer(s) personal name(s)	Mr Alistair Edward Lilley	Vintage Wine Club
Superannuation Funds Use the name of the trustee of the fund	XYZ Pty Ltd	XYZ Pty Ltd Superannuation Fund

Put the name(s) of any joint Applicant(s) and/or account description using < > as indicated above in designated spaces at section C on the Member Offer Application Form.

Broker Code

Adviser Code

Australian Unity Limited ABN 23 087 648 888

==> picture [42 x 38] intentionally omitted <==

Broker Firm Offer Application Form

A

Bonds applied for

, ,

Price per Bond Application Monies at A$100.00 B A$ , , .

(minimum 50)

PLEASE COMPLETE YOUR DETAILS BELOW (refer overleaf for correct forms of registrable names) Applicant #1 Surname/Company Name

C

D

Title First Name	Middle Name	Middle Name
Joint Applicant #2
Surname
Title First Name	Middle Name
Designated account e.g. (or Joint Applicant #3)
TFN/ABN/Exemption Code
First Applicant Joint Applicant #2			Joint Applicant #3
TFN/ABN type – if NOT an individual, please mark the appropriate box	Company		Partnership	Trust	Super Fund

PLEASE COMPLETE ADDRESS DETAILS

PO Box/RMB/Locked Bag/Care of (c/-)/Property name/Building name (if applicable)

E

Unit Number/Level	Street Number	Street Name
Suburb/City or Town			State	Postcode

Email address (only for purpose of electronic communication of Bondholder information)

CHESS HIN (if you want to add this holding to a specific CHESS holder, write the number here)

F X

Please note: that if you supply a CHESS HIN but the name and address details on your Broker Firm Offer Application Form do not correspond exactly with the registration details held at CHESS, your Application will be deemed to be made without the CHESS HIN and any Bonds issued as a result of the Offer will be held on the issuer sponsored sub-register.

Telephone Number where you can be contacted during Business Hours Contact Name (PRINT)

G ( )

Cheques or bank drafts should be drawn up according to the instructions given by your Broker.

H

Cheque or Bank Draft Number BSB Account Number Total Amount A$ , , .

==> picture [32 x 40] intentionally omitted <==

You must return your application so it is received by your Broker by the deadline set out in their offer to you.

LODGEMENT INSTRUCTIONS

AYU BRO001

Your Guide to the Broker Firm Offer Application Form

This Broker Firm Offer Application Form relates to the Broker Firm Offer by Australian Unity Limited (Australian Unity) of Series B Australian Unity Bonds – Tranche 1 (Bonds) made under the Prospectus lodged with the Australian Securities and Investments Commission (ASIC) on 9 November 2015 (and any replacement and supplementary prospectus). The Prospectus will expire 13 months after the date of the Prospectus. In accordance with the requirements of the Corporations Act 2001 (Cth), this Broker Firm Offer Application Form must not be distributed unless included in, or accompanied by, the Prospectus. Capitalised terms have the meaning given to them in the Prospectus.

If you are in doubt as to how to deal with this Broker Firm Offer Application Form, please contact your accountant, lawyer, stockbroker or other professional adviser without delay. The Prospectus contains information relevant to a decision to invest in Bonds and you should read the entire Prospectus carefully before applying for Bonds.

While the Prospectus is current, Australian Unity will send paper copies of the Prospectus, any supplementary document and the Broker Firm Offer Application Form, free of charge on request.

Please complete all relevant white sections of the Broker Firm Offer Application Form in BLOCK LETTERS, using black or blue ink. These instructions are cross-referenced to each section of the form.

• A Insert the number of Bonds you wish to apply for. The Application must be for a minimum of 50 Bonds. You may be issued all of the Bonds applied for or a lesser number.

• B Insert the relevant amount of Application Monies. To calculate your Application Monies, multiply the number of Bonds applied for by the issue price. Amounts should be in Australian dollars. Please make sure the amount of your cheque or bank draft equals this amount.

• C Write the full name you wish to appear on the register of Bonds. This must be either your own name or the name of a company. Up to three joint Applicants may register. You should refer to the table below for the correct registrable title.

• D Enter your Tax File Number (TFN) or exemption category. Business enterprises may alternatively quote their Australian Business Number (ABN). Where applicable, please enter the TFN or ABN for each joint Applicant. Collection of TFN(s) and ABN(s) is authorised by taxation laws. Quotation of TFN(s) and ABN(s) is not compulsory and will not affect your Application. However, if these are not provided, Australian Unity will be required to deduct tax at the highest marginal rate of tax (including the Medicare Levy) from payments.

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

• F If you are already a CHESS participant or sponsored by a CHESS participant, write your Holder Identification Number (HIN) here. If the name or address recorded on CHESS for this HIN is different to the details given on this form, your Bonds will be issued to Australian Unity’s issuer sponsored subregister.

• G Please enter your telephone number(s), area code and contact name in case we need to contact you in relation to your Application.

• H Please complete the details of your cheque or bank draft in this section. The total amount of your cheque or bank draft should agree with the amount shown in section B.

• If you receive a firm allocation of Bonds from your Broker make your cheque payable to your Broker in accordance with their instructions.

CORRECT FORMS OF REGISTRABLE NAMES

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

Type of Investor	Correct Form of Registration	Incorrect Form of Registration
Individual Usegiven names in full,not initials	Mrs Katherine Clare Edwards	K C Edwards
Company Use Company’s full title,not abbreviations	Liz Biz Pty Ltd	Liz Biz P/L or Liz Biz Co.
Joint Holdings Use full and complete names	Mr Peter Paul Tranche & Ms Mary Orlando Tranche	Peter Paul & Mary Tranche
Trusts Use the trustee(s) personal name(s)	Mrs Alessandra Herbert Smith	Alessandra Smith Family Trust
Deceased Estates Use the executor(s) personal name(s)	Ms Sophia Garnet Post & Mr Alexander Traverse Post	Estate of late Harold Post or Harold Post Deceased
Minor (a person under the age of 18 years) Use the name of a responsible adult with an appropriate designation	Mrs Sally Hamilton	Master Henry Hamilton
Partnerships Use the partners’ personal names	Mr Frederick Samuel Smith & Mr Samuel Lawrence Smith	Fred Smith & Son
Long Names	Mr Hugh Adrian John Smith-Jones	Mr Hugh A J Smith Jones
Clubs/Unincorporated Bodies/Business Names Use offce bearer(s) personal name(s)	Mr Alistair Edward Lilley	Vintage Wine Club
Superannuation Funds Use the name of the trustee of the fund	XYZ Pty Ltd	XYZ Pty Ltd Superannuation Fund

Put the name(s) of any joint Applicant(s) and/or account description using < > as indicated above in designated spaces at section C on the Broker Firm Offer Application Form.

40 PART B Base Prospectus