GPT GROUP — Regulatory Filings 2004

Sep 30, 2004

GPT Split Trust Stock Exchange Announcement & Media Release

Lend Lease Proposal to Acquire all of the

Units in the GPT Split Trust

1 October 2004

GPT Management Limited (GPTML) as responsible entity of the GPT Split Trust (the Split Trust) advises that GPTML has received a proposal from Lend Lease Corporation (Lend Lease) which, if approved by Split Trust unitholders, will result in Lend Lease acquiring all of their units for cash (the Proposal).

The Proposal is unanimously recommended by GPTML's independent directors, subject to no superior proposal emerging and to an independent expert confirming that it is fair and reasonable and in the best interests of Split Trust unitholders. The Proposal is subject to the proposed merger of Lend Lease and General Property Trust (GPT) proceeding and several other conditions, including Split Trust Unitholder approval.

GPTML intends to put the proposal to a meeting of Split Trust unitholders in mid November 2004

Recommendation

The Independent Directors determined that the Proposal is in the best interests of Split Trust unitholders following:

• consideration and evaluation of a number of alternatives; and $\bullet$ .
• negotiation with Lend Lease of the proposal outlined in this announcement. $\bullet$

A summary of the alternatives considered on behalf of Split Trust unitholders are dealt with in the attachment.

An explanatory memorandum containing a detailed explanation of the Proposal, the alternatives considered and the opinion of an independent expert on the Proposal will be dispatched to unitholders in mid October.

Cash consideration for Income Unitholders under the Proposal

Lend Lease will pay Income unitholders:

• 1. \$2.338 per Income Unit, being the volume weighted average price of Income Units over the 5 trading day period to 30 September 2004; plus
• 1. 25% of any excess realised through the GPT Cash Sale Facility (refer to "Realisation through the Cash Sale Facility" below).

Cash consideration for Growth Unitholders under the Proposal

Lend Lease will pay Growth Unitholders:

• 1. \$1.638 per Growth Unit being the amount calculated to be payable in respect of a Growth Unit on a winding up of the Split Trust (applying the winding up provisions of the Split Trust Constitution¹ and assuming the Split Trust's GPT units were sold at the volume weighted average price of GPT units over the 5 trading day period to 30 September 2004 (Lend Lease proposal $VWAP^2$ ) and no winding up costs); plus
• 1. 75% of any excess realised through the GPT Cash Sale Facility (refer to "Realisation through the Cash Sale Facility" below).

Distributions to Split Trust Unitholders

The GPT September distribution will be paid to Income and Growth unitholders in the ordinary course on 22 November 2004. Assuming the Proposal is approved by Split Trust unitholders, any subsequent GPT distributions received by the Split Trust (including the special distributions related to the Lend Lease/GPT merger) will accrue to Lend Lease.

Realisation through the Cash Sale Facility

If Split Trust unitholders approve the Proposal, GPTML will immediately elect to sell the Split Trust's GPT units into the Sale Facility made available under the Lend Lease/GPT merger. If the effective price per GPT unit achieved via the Sale Facility (see below) exceeds the Lend Lease proposal VWAP of \$3.684, 25% of any excess will be paid to Income Unitholders and 75% of any excess will be paid to Growth Unitholders.

The effective price per GPT unit achieved via the Sale Facility will be calculated as follows:

$SFP + SD₁ + SD₂ + DD$ Effective Price =

Where: SFP = Actual price achieved per GPT unit under the GPT Sale Facility

• Special distribution of up to 65 cents per GPT unit³ related to the GPT/Lend $SD_1 =$ Lease merger
• $SD₂$ = Special distribution of 0.6 cents per GPT unit
• $DD =$ Pre-Implementation Merger Distribution, representing the estimated pro-rata GPT December quarter distribution from 1 October 2004 to 30 November 2004

Conditions

^<sup>1The trust deed for the Split Trust provides that on a winding up the net cash proceeds derived from the realisation of the trust fund are divided amongst units on issue as follows: (a) the first \$1.50 distributed and 25% of the balance in excess of \$1.50 distributed goes to the holders of Income units; and (b) 75% of the amount in excess of \$1.50 distributed goes to the holders of Growth units.

^<sup>2 The GPT volume weighted average unit price ("VWAP") excludes the exercise of three call options on Friday 24 September 2004 which otherwise distort the VWAP to a lower number.

^<sup>3 The actual size of the special distribution will vary depending on the level of participation by GPT unitholders in the GPT cash-out option

Under the Implementation Agreement entered into between GPTML and Lend Lease, the Proposal is subject to no superior proposal being received and the following conditions:

• 1. Unitholder approval of the resolutions required to implement the Proposal. The resolutions must be passed by (a) at least 75% by value of the votes cast by holders of Income Units entitled to vote; and (b) at least 75% by value of the votes cast by holders of Growth Units entitled to vote.
• 1. An independent expert advising that the proposal is in the best interests of each class of Split Trust unitholders.
• 1. The proposed GPT and Lend Lease merger being approved.
• 1. Satisfaction of various regulatory conditions and approvals.

ENDS

For further information please contact

Michael O'Brien Fund Manager, GPT (02) 9236 6235

Donna Byrne Investor Relations Mar. GPT (02) 9237 5844

Graham Canning Cannings (02) 9252 0622

Governance

The following directors of GPTML are not independent for the purpose of GPTML as responsible entity of the Split Trust responding to the Lend Lease proposal: Richard Longes (Chairman), Ross Taylor and Brian Norris. They have declared their position and stood aside from any Board considerations of the proposal from Lend Lease.

Peter Joseph has been elected chairman of the Split Trust Board for the purpose of evaluating the proposal and making recommendations to Split Trust Unitholders. The independent directors comprise: Peter Joseph (Chairman), Malcolm Latham, Ken Moss and Elizabeth Nosworthy.

In light of the connections between GPTML and Lend Lease, GPTML has taken steps to ensure the independence and integrity of the processes by which the Independent Directors of GPTML evaluate the Lend Lease proposal to the Split Trust and make recommendations to Split Trust unitholders.

To this end, Blake Dawson Waldron has been engaged by GPTML to provide advice regarding the governance processes required to ensure an independent evaluation of the proposal.

Background

• On 6 August 2004. GPT announced that it had agreed merger terms with Lend Lease. Under that proposal, which remains subject to GPT unitholder, Lend Lease shareholder and Court approvals. GPT units will be stapled to Lend Lease shares issued to GPT unitholders, and will trade on the ASX as a single stapled security. The Split Trust, which was established in 1984, invests in GPT units and held approximately 21.4 million GPT units on behalf of Split Trust investors at 30 June 2004
• As the Split Trust Constitution does not allow the trustee to invest the trust funds in ٠ any property other than GPT units and many of the provisions of the Constitution (including those relating to distributions) are formulated on the basis that the only property of the Split Trust will be GPT units, the Split Trust cannot continue in its current form if the proposed merger proceeds.
• The three possible alternatives which the Split Trust trustee has been investigating are:
• to amend the trust deed to allow the trust to hold stapled securities: $\ddot{\phantom{1}}$
• to apply to the Court for directions to wind up the Split Trust; and
• more recently, the Proposal.
• In the view of the GPTML Independent Directors, the first of these alternatives is not viable for Split Trust unitholders for a number of reasons, including:
• $\bullet$ such amendments would likely give rise to material unfunded tax liabilities within the Split Trust
• the trust deed would need to be substantially rewritten, as the current $\bullet$ distribution and other provisions only contemplate the Split Trust holding units in a trust. Given that the interests of Growth Unitholders and Income Unitholders in relation to those amendments are likely to be in direct conflict, it appears unlikely that the requisite majorities could be obtained at meetings of unitholders to effect the amendments to the trust deed.
• GPTML has therefore assessed the winding up option against the Proposal. In GPTML's view, the Proposal provides a superior outcome for Split Trust unitholders for the following reasons:
• the amount payable to Growth Unitholders under the Lend Lease proposal represents a premium to the current 5 day VWAP for Growth Units, and is equal to or greater than the amount calculated to be payable in respect of a Growth Unit on a winding up of the Split Trust (see the table and related notes below)
• the amount payable to Income Unitholders under the Lend Lease proposal represents a premium to the amount calculated to be payable in respect of an Income Unit on a winding up of the Split Trust (see the table and related notes below)
• $\bullet$ the Lend Lease proposal provides certainty to Split Trust unitholders and avoids the costs, expenses and possible delays for unitholders of a winding up of the trust. These costs would be payable by the trust prior to any consideration being distributed to Income and Growth Unitholders.

Units	Current 5 day VWAP	$LLC$ proposal 5		Wind up 6
		Price	Premium	Price	Premium
Income Units	\$2.338	\$2.338	$0.0\%$	\$2.046	(12.5%)
Growth Units	\$1.316	\$1.638	24.4%	\$1.638	$24.4\%$

A summary of the financial outcomes of the Lend Lease proposal and a wind up of the Split Trust is as follows⁴.

Winding up alternative

If the resolutions required to implement the Proposal are not approved. GPTML proposes to put to Split Trust unitholders a resolution directing GPTML as responsible entity to wind up the Split Trust if the proposed GPT/Lend Lease merger proceeds.

If that wind up resolution is not approved, GPTML proposes to approach the Court for an order to wind up the Split Trust if the proposed GPT/Lend Lease merger proceeds, on the basis that it is just and equitable to do so.

^<sup>4 The financial outcomes in the table do not take into account the tax considerations of Split Trust unitholders.

^<sup>5 Note that the LLC proposal consideration here provides a floor. Split Trust unitholders will receive further consideration if the effective GPT price achieved in the Sale Facility exceeds the current 5 day GPT volume weighted average unit price ("VWAP"). The GPT VWAP excludes the exercise of three call options on Friday 24 September 2004 which otherwise distort the VWAP to a lower number.

^<sup>6 Assumes wind up consideration per GPT unit equal to current 5 day GPT VWAP. The GPT VWAP excludes the exercise of three call options on Friday 24 September 2004 which otherwise distort the VWAP to a lower number. The trust deed for the Split Trust provides that on a winding up the net cash proceeds derived from the realisation of the trust fund are divided amongst units on issue as follows: (a) the first \$1.50 distributed and 25% of the excess goes to the holders of Income units; and (b) 75% of the amount in excess of \$1.50 goes to the holders of Growth units.