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Group Five - BEE ownership transaction; salient dates announcement and introduction of a new management incentive scheme Group Five Limited (Incorporated in the Republic of South Africa) (Registration number 1969/000032/06) JSE code: GRF ISIN: ZAE 000027405 ("Group Five" or "the Company") BEE OWNERSHIP TRANSACTION SALIENT DATES ANNOUNCEMENT AND INTRODUCTION OF A NEW MANAGEMENT INCENTIVE SCHEME 1. Introduction Shareholders are referred to the announcement dated 8 August 2005, which set out the terms of the Company"s Black Economic Empowerment ownership initiative that will introduce black people into the shareholding structure of the Company ("the BEE transaction"). The implementation of the BEE transaction is subject to shareholder approval at a general meeting of the shareholders of Group Five, which will be held immediately after the close of the Annual General Meeting of Group Five shareholders on 29 September 2005. 2. New Management Incentive Scheme Due to recent developments in the regulatory environment, and best practice in local and global share schemes, Group Five has reviewed the current Group Five Share Incentive Scheme and identified the need for it to be replaced with a more efficient scheme. The proposed New Management Incentive Scheme has the advantages of simpler mechanics, it optimises the tax position of the company and the employees and is easier to administer. The current Group Five Share Incentive Scheme, which operates as an option scheme, will remain in place for options currently granted under this scheme, until such time as these options are exercised or lapse. The sizing of the aggregate incentive schemes and their salient features remains unchanged as set out in the table below: Current Proposed Scheme Scheme Maximum number of shares 11 036 000* 11 036 000* available to Scheme as a percentage of current 15% 15% shares issued Maximum number of shares 1 500 000 1 500 000 available to individual as a percentage of current 2% 2% shares issued Discount to Market Value on date 15% 15% of option/ SAR Vesting period 2 years - 50% 2 years - 50% 3 years -75% 3 years -75% 4 years - 100% 4 years - 100%
Lapsing period 10 years 7 years * at no time will the aggregate number of shares available to both schemes exceed 11 036 000 Group Five shares. The implementation of the New Management Incentive Scheme is subject to shareholder approval, which will be sought at the general meeting to be held on 29 September 2005. The New Management Incentive Scheme is not part of the BEE transaction; Group Five has determined that it is more efficient to communicate the two matters simultaneously to shareholders. The New Management Incentive Scheme should not be confused with the Black Management Scheme which is part of the BEE transaction. 3. Salient dates and times The expected dates and times pertaining to the general meeting are set out below: 2005 Forms of proxy for the general meeting to be received by 12:00 on Tuesday, 27 September General meeting of ordinary shareholders to be held immediately after the close of the AGM which begins at 12:00 on Thursday, 29 September Results of the general meeting to be released on SENS on Thursday, 29 September Results of the general meeting to be published in the South African press on Friday, 30 September If shareholders vote in favour of the BEE Transaction, then the following dates apply Issue of new Group Five shares Monday, 3 October Commencement of listing of new Group Five shares Monday, 3 October Notes: 1. Any variation of the above dates and times will be released on SENS and published in the press. 2. Dematerialised shareholders, other than own name dematerialised shareholders, must provide their Central Securities Depository Participant ("CSDP") or broker with their instructions for voting at the general meeting by the cut-off time and date advised by their CSDP or broker for instructions of this nature. 4. Empowerdex"s opinion on the BEE transaction Group Five engaged Empowerdex (Pty) Ltd ("Empowerdex"), in its capacity as an economic empowerment rating agency, to conduct a transaction review and compliance analysis on the BEE transaction. Based on information and documentation provided by Group Five, iLima Consortium (Pty) Ltd and Mvelaphanda Group Ltd, Empowerdex found that the proposed BEE transaction currently scores in excess of 80% on the ownership scorecard contained in the latest draft of The Codes of Good Practice on Broad-based Black Economic Empowerment published by the Department of Trade and Industry, which measures voting rights, economic interest and net equity. 5. Circular A circular, which has been approved by the JSE, providing full information on the BEE Transaction; the New Management Incentive Scheme and incorporating a notice in respect of the general meeting of Group Five shareholders was posted to Group Five shareholders on Tuesday, 6 September 2005. Copies of the circular may be obtained during normal business hours from the registered office of Group Five, 371 Rivonia Boulevard, Rivonia. Sandton 7 September 2005 Investment bank, Transaction Advisor and Sponsor to Group Five Nedbank Capital Reporting Accountants and Auditors PriceWaterhouseCoopers Attorneys Prinsloo, Tindle and Andropoulos Inc Economic empowerment rating agency Empowerdex Date: 07/09/2005 07:05:08 AM Supplied by www.sharenet.co.za Produced by the JSE SENS Department
