THE GEARED EMPLOYEE SHARE TRUST - OPERATION

Implementation Steps

1. The EST acquires loan funding from a lender on the anticipated level of allocation of share units to the participating employee nominated by the Employer.
2. The EST utilises loans to acquire shares from the Employer.
3. The EST makes an offer to selected Participating Employees of units in the EST and an interest-free loan to acquire those units.
4. The Participating Employees subscribe for Share Units to which shares have been allocated, funded by way of the interest-free loan provided by the EST.
5. Participating Employees use defered bonus amounts, as well as any dividend entitlements which are paid to the Geared EST to then repay the loan and interest commitments.
6. Upon encashment (that is, redemption), bonus share units are issued to enable employees to receive full share value (that is, rather than growth-only benefits).
7. Participating Employees only taxed on dividends paid and encashment of Share Units.