TOWER LIMITED — Capital/Financing Update 2009

Aug 24, 2009

==> picture [595 x 62] intentionally omitted <==

25 August 2009

Company Announcements Office	Market Information
Australian Stock Exchange Limited	New Zealand Exchange
Exchange Centre	Limited
Level 6, 20 Bridge Street	ASB Bank Tower
Sydney NSW 2000	Level 9, 2 Hunter Street
ARBN 0088 481 234 Incorporated in New Zealand	Wellington

TOWER Rights Issue: Letters to Shareholders and Optionholders

Attached are copies of letters sent to shareholders and optionholders respectively in relation to the rights issue announced by TOWER on 24 August 2009.

Bronwyn Walsh Company Secretary & Compliance Manager TOWER Limited

==> picture [595 x 49] intentionally omitted <==

Insurance Investments KiwiSaver

TOWER Limited

ADDRESS BLOCK

Level 11 TOWER Centre 22 Fanshawe Street Auckland 1010 Telephone: +64 9 369 2000 Website: www.tower.co.nz

25 August 2009

Dear Shareholder

Renounceable Rights Issue

On 24 August 2009, TOWER Limited ( TOWER ) announced a renounceable rights issue ( Rights Issue ) of 5 fully paid new ordinary shares in TOWER ( New Shares ) for every 16 existing TOWER shares held at 7.00pm New Zealand time (5.00pm (AEST)) on 2 September 2009 ( Record Date ) at an issue price of NZ$1.34 per New Share. The offer will only be made to those shareholders with a registered address in Australia or New Zealand ( Eligible Shareholders ). The entitlements of all other shareholders will be issued to a nominee who will endeavour to sell those entitlements and the net proceeds will be paid to such shareholders.

Under the Rights Issue, approximately 60.7 million New Shares will be issued to raise approximately NZ$81.3 million, assuming no shares are issued prior to the Record Date to Optionholders (referred to below). Fractional entitlements will be rounded to the nearest whole number.

The Rights Issue will be fully underwritten by Goldman Sachs JBWere NZ Limited ( GSJBW ) who will receive an underwriting fee of 2% of the total proceeds raised under the Rights Issue. In addition, Guinness Peat Group plc, TOWER’s largest substantial security holder (controlling approximately 35% of the issued shares in TOWER) has committed, subject to certain conditions, to take up its entitlement under the Rights Issue in full in exchange for a commitment fee which will be paid by GSJBW from its underwriting fee.

Use of proceeds

The additional capital raised by the Rights Issue will provide support for TOWER’s future growth and enhance the TOWER Group’s financial strength. It will support TOWER’s long term strategy for organic business growth and give the financial flexibility needed for any strategic opportunities that may arise.

Applying for new Shares or selling entitlements

The right to subscribe for new Shares under the Rights Issue is renounceable, which means that Eligible Shareholders may choose to sell (renounce) any rights that they do not accept. If you do not accept or renounce your entitlement, your Rights will lapse and you will not be able to subscribe for any new Shares or realise any other value for your entitlement, and your shareholding in the Company will be diluted as a result of the Rights Issue.

Shareholders may also apply for new Shares in excess of their entitlement (except Shareholders who are ‘Related Parties’ of TOWER within the meaning of the ASX or NZX Listing Rules, who cannot participate in any excess subscription facility). However, applications for additional shares may only be satisfied out of any shortfall of subscriptions under the Rights Issue and there is no guarantee that Shareholders will receive the

number of additional shares applied for or any additional shares at all. To the extent that your application for additional shares is scaled back or rejected, the excess application monies will be refunded to you without interest.

An Offer Document in relation to the Rights Issue will be sent to all Eligible Shareholders together with an Entitlement and Acceptance Form on 7 September 2009. The Offer Document was lodged with ASIC and ASX and registered in New Zealand on 24 August 2009 and is available on the ASX website, from NZX and on TOWER’s website at www.tower.co.nz. The Offer Document is a combined short-form prospectus and investment statement for the purposes of the New Zealand Securities Act 1978. The offer is being made to Australian Shareholders under the Offer Document in accordance with the Trans-Tasman Mutual Recognition Scheme. Accordingly, TOWER is not required to prepare an Australian prospectus for the Rights Issue pursuant to Part 6D of the Corporations Act 2001.

If you wish to take up some or all of your entitlement under the Rights Issue you must complete the Entitlement and Acceptance Form in or accompanying the Offer Document.

Eligible Shareholders who trade in Rights before receiving confirmation of their allocation of Rights do so at their own risk. Eligible Shareholders can ascertain their entitlement to rights by calling Computershare on 0800 222 065 in New Zealand or 1800 501 366 in Australia at any time after 2 September 2009, being the Record Date for the Rights Issue.

Shareholders wishing to take up their entitlement in full under the Rights Issue should indicate this on the Entitlement and Acceptance Form and send their completed form together with payment for the number of new Shares applied for to Computershare, any Primary Market Participant, Stockbroker, Organising Participant or any other channel approved by the NZX or ASX (as applicable), in time to be received by Computershare, and for funds to clear, by 7.00 pm (New Zealand time) on 23 September 2009.

Shareholders who wish to accept part of their entitlement under the Rights Issue and sell the remainder will need to:

• instruct a stockbroker to sell the number of entitlements that they wish to renounce; and

• indicate the number of new Shares that they wish to apply for on the acceptance form included in the Entitlement and Acceptance Form and send the completed form together with payment for the number of new Shares applied for directly to the stockbroker through whom the entitlements were sold.

Shareholders who wish to sell their entitlement under the Rights Issue in full can do so on NZX or ASX by instructing a stockbroker to sell the number of entitlements specified on the Entitlement and Acceptance Form.

An application has been made to NZX and ASX for quotation of the Rights and all requirements of NZX and ASX relating thereto that can be complied with on or before the date of this letter have been duly complied with. However, neither NZX nor ASX accepts responsibility for the contents of or any statement in this letter.

Foreign resident Shareholders

The Offer is only available to Shareholders with a registered address in New Zealand or Australia, who are registered as Shareholders of TOWER at 7.00 pm New Zealand time on 2 September 2009.

TOWER considers that it is unreasonable to make the Offer to Shareholders resident outside of New Zealand and Australia having regard to the low number of such Shareholders, the number and value of new Shares such Shareholders would be offered and the costs of complying with overseas legal requirements.

The entitlements that Shareholders who are resident in jurisdictions outside New Zealand and Australia would have otherwise received under the Offer, will instead be issued to a nominee who will endeavour to sell those entitlements, hold the proceeds on trust and account to those Shareholders on a pro rata basis for the proceeds, net of costs.

Optionholders

Those optionholders who hold options that are currently eligible to be exercised will, if such options are exercised before the Record Date, be entitled to participate in the Rights Issue ( Eligible Optionholders ). On 24 August 2009, TOWER notified all Eligible Optionholders of their right to participate in the Rights Issue.

Timetable for the Rights Issue

It is proposed that the Rights Issue be conducted according to the following timetable:

Event	Date
Offer Document registered in New Zealand and lodged with ASIC and ASX	24 August 2009
Shares quoted on an “ex” entitlement basis on ASX. Rights trading starts on ASX	27 August 2009
Record Date for determining entitlements to new Shares, 7.00pm New Zealand time	2 September 2009
(5.00pm (AEST))
Shares quoted on an “ex” entitlement basis on NZX. Rights trading starts on NZX.	3 September 2009
Offer document and Entitlement and Acceptance Forms despatched to Eligible	7 September 2009
Shareholders
Offer opening date	7 September 2009
End of rights trading on ASX	16 September 2009
Deferred settlement trading in new Shares commences on ASX	17 September 2009
End of rights trading on NZX	21 September 2009
Offer closing date, 7.00pm New Zealand time (5.00pm (AEST))	23 September 2009
TOWER notifes ASX and NZX of under-subscriptions	28 September 2009
Anticipated date for allotment and issue of new Shares	28 September 2009
Despatch holding statements	29 September 2009
Trading of new Shares commences on normal settlement basis	30 September 2009

This timetable is indicative only and is subject to change. The Directors of TOWER reserve the right to vary these dates in accordance with the ASX and NZX Listing Rules. The Directors of TOWER also reserve the right not to proceed with the Rights Issue at any time prior to the allotment and issue of the new Shares. In that event any application monies received by TOWER will be returned in full to applicants (without interest).

No shareholder approval is required for the Rights Issue.

Impact on share capital

The new Shares will be fully paid and will rank equally in all respects with other fully paid ordinary shares on issue in TOWER.

The number of shares on issue in TOWER as at the date of this letter and the total number of shares that will be on issue at the close of the Rights Issue are as follows:

be on issue at the close of the Rights Issue are as follows:
Number of shares currentlyon issue andquoted on ASX	194,114,566
Maximum number of new Shares to be issued*	61,169,742
Maximum number of shares on issue following completion of the Rights Issue*	256,912,916

*assumes that all Eligible Optionholders exercise their options to enable them to participate in the Rights Issue.

I encourage you to carefully read the Offer Document before deciding whether to acquire new Shares or to sell your Rights, and to consult your financial adviser before making any investment decision. If you do nothing, your Rights will lapse and your shareholding in the Company will be diluted.

Yours faithfully

A I (Tony) Gibbs CNZM Chairman

==> picture [595 x 62] intentionally omitted <==

24 August 2009

[Name] [Address] [Email]

Dear [Name]

Rights issue - Executive Share Option Plan

Rights Issue

TOWER Limited (TOWER) has announced today that it will be undertaking a renounceable 5 for 16 rights issue of ordinary TOWER shares at NZ$1.34 per ordinary share to raise approximately NZ$81.3 million (Rights Issue). The Rights Issue is fully underwritten.

Participation in Rights Issue

Currently you hold options issued under TOWER's Executive Share Option Plan ( Option Plan ). An option does not entitle the holder to participate in the Rights Issue, other than upon exercise of an option.

[ Option if executive does not hold options which can be exercised ]. You do not currently hold options which are presently exercisable. Accordingly, you will not be able to participate in the Rights Issue with regard to the options.

[ Option if executive does hold options which are presently exercisable ]. You currently hold options which can be exercised. If you wish to participate in the Rights Issue, in relation to those options, you will need to exercise the options in sufficient time before Tuesday,1 September 2009 to ensure you are recorded on the register as holding TOWER shares, in respect of your exercised options, prior to the Record Date for the Rights Issue of 2 September 2009.

You should read the information below about the impact of the Rights Issue on the exercise price of your options before making any decision.

If you would like further information about how to exercise your options, please contact me.

Exercise price of options following the Rights Issue

Subject to compliance with the terms of the Option Plan, the NZSX Listing Rules and the ASX Listing Rules, the board has a discretion to adjust the exercise price for the options, following the Rights Issue, to take into account the effect of the Rights Issue on the exercise price of your options. The Board has approved the exercise of this discretion and the adjustment to the exercise price will be calculated, and advised to option holders, following completion of the Rights Issue.

Please let me know if you have any questions.

Yours sincerely

Bronwyn Walsh Company Secretary and Compliance Manager TOWER Limited

==> picture [595 x 49] intentionally omitted <==