GPT GROUP — Regulatory Filings 2004

Aug 5, 2004

General Property Trust ASX Announcement and Media Release

GPT AGREES MERGER TERMS

WITH LEND LEASE

6 August 2004

The GPT Board is pleased to announce that it has today agreed terms, under which they and the directors of Lend Lease Corporation ("Lend Lease") have agreed to recommend to their respective investors a merger of GPT and Lend Lease.

The GPT Board believes that the merger is in the best interests of GPT unitholders. and intends to recommend the merger in the absence of a superior proposal emerging.

Implementation of the proposal is subject to various conditions including entry into a Merger Implementation Agreement.

The GPT Board is comprised of the Independent Directors (Peter Joseph, Malcolm Latham, Elizabeth Nosworthy and Ken Moss) chaired by Peter Joseph for the purpose of considering the merger proposal announced with Lend Lease.

"The GPT Board has agreed to revised merger terms which address the important financial and non-financial issues referred to in our announcement of 27 July 2004. We believe it adequately compensates our investors for risk and provides choice to the small unitholders according to their risk profile. There are exciting possibilities for the new group. It is also the only proposal we have on the table and we now intend to get on with it", Peter Joseph said.

The key terms of the merger proposal include:

• Lend Lease shares and GPT units to be stapled in the ratio of one Lend Lease $\equiv$ share for every 3.8 GPT units, plus GPT unitholders to receive up to 65c cash¹ per GPT unit subject to the take-up of the cash-out facility.
• Immediately prior to stapling, Lend Lease shareholders will receive a special distribution of \$95 million and GPT unitholders will receive a special distribution of \$12.75 million.
• Lend Lease will pay to GPT an amount of \$3.4 million equivalent to its performance fee for the half ended 30 June 2004, conditional on the merger completing. This will be included in the September distribution to GPT unitholders.

Any cash used to acquire GPT units under the cash out facility will proportionately reduce the cash component paid to non-participating units with an associated compensating adjustment to the stapling ratio.

Lend Lease has announced today that it will suspend its on-market buyback and instead complete its buyback programme via an off-market buyback of up to \$388 million in conjunction with the stapling.

GPT's register has over 50,000 small investors. Arrangements have been put in place to allow these smaller investors to cash out their units at a fixed price of \$3.48.

A brokerage free on-market sale and exchange facility will also be offered to GPT unitholders. This facility may provide certain advantages to unitholders owning units acquired before 20 September 1985.

"The GPT Board and management believes that non-financial issues together with the commercial terms of the merger are essential to ensure the merged entity is well supported by LPT sector investors and can achieve a competitive cost of capital". Peter Joseph said.

Importantly, the GPT Board and management has also reached agreement with Lend Lease on the operating philosophy of the merged entity, including:

• Adoption of a structure and investment management culture that is reflective of the $\equiv$ listed property trust sector;
• A strong focus on financial risk management in order to limit earnings volatility;
• Investor relations and communications with investors consistent with LPT sector norms for stapled entities:
• Adoption of a single acquisition pipeline and evaluation process for all investment assets whether owned by the merged entity or managed on behalf of third parties; and
• Transparency and clarity around all of the above.

The two parties have also reached agreement on board composition and management structure. The new board of the merged entity will comprise representation from 3 of the current GPT Independent directors, 5 current Lend Lease directors and one or more new directors. The management structure of the merged entity will reflect the group's strategic direction and priorities.

Conditions of the proposal

• 1. Execution of a merger implementation agreement.
• 1. Obtain all relevant regulatory approvals.
• 1. Obtain relevant unitholder and shareholder approvals.
• 1. Grant Samuel and Ernst and Young, (who have been appointed as independent experts by GPT and Lend Lease respectively to report on the terms of the proposal) confirming that the proposal is in the best interests of GPT unitholders and Lend Lease shareholders.
• 1. No superior proposal emerging.

Timina

The Boards of Lend Lease and GPT plan to circulate explanatory memoranda and to convene relevant investor meetings, within 8 to 10 weeks.

The Boards of Lend Lease and GPT anticipate that investor meetings will be held in November.

The GPT Board recommends that unitholders take no action until they receive a copy of the explanatory memorandum.

Governance

In light of the connections between GPT Management Limited ("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 and make recommendations to GPT unitholders in relation to the Lend Lease merger proposal, which has included the appointment of Blake Dawson Waldron as a governance adviser and the adoption of a Governance Protocol.

On the basis of Blake Dawson Waldron's observations and from the information provided to Blake Dawson Waldron, they have confirmed that they are satisfied that the Independent Directors and their advisers have undertaken an appropriate and rigorous evaluation of the proposal and that the Governance Protocol has been complied with.

ENDS

Enquiries

For further information please contact Nic Lyons Chief Executive Officer General Property Trust (02) 9237 5816

Martin Debelle /Graham Canning Cannings $(02)$ 9252 0622

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