York Timber Holdings Limited
Incorporated in the Republic of South Africa
(Registration number 1916/004890/06)
Share code: YRK
ISIN: ZAE000133450
(“York” or the “Company”)

CHANGE TO THE BOARD, WITHDRAWAL OF ORDINARY RESOLUTION 4.3 AT THE
UPCOMING ANNUAL GENERAL MEETING AND AMENDMENTS TO THE PERFORMANCE
TARGETS AND NEW LONG-TERM INCENTIVE SCHEME

CHANGE TO THE BOARD AND WITHDRAWAL OF ORDINARY RESOLUTION 4.3 AT THE
UPCOMING ANNUAL GENERAL MEETING

In compliance with paragraph 3.59 of the JSE Limited Listings Requirements (“JSE Listings
Requirements”), York shareholders (“Shareholders”) are advised that Dr. Azar Jammine position
as an independent non-executive director of the Company, will come to an end as a result of his
tenure on the board of directors of York (“Board”) exceeding nine years, at the conclusion of the
Company’s annual general meeting (“AGM”) to be held on Wednesday, 9 November 2022.

Furthermore, Shareholders are referred to the notice of the Company’s AGM dated Friday,
7 October 2022 and are advised that, as a result of the resignation of Dr. Jammine, ordinary
resolution 4.3 regarding his re-election as a member of the audit committee of the Company, has
been withdrawn and will not be proposed for consideration at the AGM.

Dr. Jammine joined the Board as an independent non-executive director in October 2010 and has
served as a member of the audit committee and the remuneration and nomination committee
(“Remco”) since 2011.

The Board would like to thank Dr. Jammine for his invaluable service to the Company and wishes
him the very best in his future endeavours.

PERFORMANCE TARGETS

Shareholders are referred to the announcement published on SENS on Wednesday,
10 November 2021, wherein the Company advised Shareholders that the Board as well as the
Remco were endeavouring to algin the long-term incentive (“LTI”) and short-term incentive (“STI”)
schemes with Shareholder expectations.

The STI scheme was reviewed to align senior employee rewards with very specific outcomes as
detailed in York’s 10-year plan. The fundamental changes to the format of the STI scheme for the
financial year ended 30 June 2022 was to increase the chief executive officer’s (“CEO”) percentage
of STI earned on the achievement of earnings before interest, taxation, depreciation and
amortisation (“EBITDA”) to 75%, and to ensure that operational managers earn their STI based on
the areas of the group that they manage. In this regard the processing management have had their
STI targets adjusted to reflect operational efficiency and volume targets that more closely align with
plant capacities, rather than historical performance. The participants in the scheme are typically
senior management employees across the York entities. The STI scheme allocates a maximum
participation level based on a percentage of participants’ annual guaranteed remuneration. The
STI scheme is self-funding.

The executive team’s individual targets are determined by the CEO and the next tier below are
developed in conjunction with the respective divisional heads to ensure alignment with business
unit objectives and the individual’s sphere of influence. The participant must achieve a minimum
individual performance score, which is moderated by the divisional head. The EBITDA target is
derived by utilising EBITDA as reported and adjusting for non-trading items (as defined in the
SAICA Circular 01/2021) that are typically added back to earnings before interest and taxation
(“EBIT”) in deriving headline earnings and include such items as asset impairments, loss on sale
of property or equipment and items that may be deducted from EBIT. Restructuring costs and
adjustments for rationalisation decisions are, therefore, included in this EBITDA target. The broad-
based black economic empowerment (“B-BBEE”) factor is to be applied to all employees that have
any influence on B-BBEE scoring aspects. The impact of B-BBEE will not be a qualifying factor of
incentive earning for achievement, but rather serves as a “disqualifier” that reduces the maximum
bonus otherwise earned by a significant percentage. The maximum reduction due to B-BBEE is
25% of the incentive earned for key staff members in any particular year.

A new LTI in the form of a deferred cash bonus scheme has been introduced for certain key
employees, which is easier to manage with a greater degree of predictability and still entrenching
values aligned with shareholder priorities. The scheme relies on the same specific performance
criteria defined each year for the STI scheme to determine contributions to the scheme.

A summary of the salient criteria for the new LTI are as follows:

•   A participating employee’s total cost to company (“TCTC”) is used as basis for the calculation
    of the individual’s bonusable amount (“IBA"). The CEO and chief financial officer (“CFO”) will
    have an IBA of 3 times his/her TCTC, with the balance of the participating employees having
    multiples of 2,5 and lower. The participating employees’ multiple is approved by the Remco
    where several factors including seniority, specialised skill and role in the organisation are
    considered.
•   Each annual contribution to the LTI scheme is calculated by multiplying 1/3 of the employees’
    bonusable amount by STI achievement factor in a year.
•   The contribution to the LTI scheme is to be drawn down on a rolling basis with the first
    drawdown at the end of year three. The first available drawdown at the end of year three will
    be determined by the participants’ performance in year 1, using the same criteria as specified
    in the STI for year 1.
•   Employees will have the option to increase the value of the contribution to the scheme by 25%
    if, rather than electing a cash option for the annual contribution on the drawdown date, elect to
    use the annual contribution to purchase ordinary shares in York (“Shares”). The election must
    be made on the date that the annual contribution is determined for the participating employee.
    If the employee elects to purchase Shares the company will make a loan to the individual to
    purchase Shares, and the Shares will be ceded to the company as security for the loan. The
    employee will be responsible for the full outstanding loan value regardless of the value of the
    Shares on the repayment date. The loan repayment date will be aligned with the annual
    contribution drawdown date.
•   If the employee leaves employment before the drawdown date, the annual contributions are
    forfeited and if the employee elected to purchase Shares under the LTI share purchase option,
    the company has the right to repurchase the Shares, subject to the JSE Listings Requirements,
    at the outstanding balance of the loan.
•   Each employee will have a maximum share conversion percentage, with the CEO and CFO
    having the right to convert 100% of his\her annual contribution and senior management 75%.
    Other participating employees may have lower percentages as determined by the Remco.

Contributions to the new LTI scheme will commence in June 2023 with participants having first
access to the accrual in June 2025, subject to the employee remaining in the employ of York.




Sabie, Mpumalanga
7 November 2022

Sponsor
One Capital