The upper bearing race is held in place by the upper cap. The race slides into the steering box housing and is allowed to float. The gasket shims are used to set the preload on the pair of tapered roller bearings on the worm. You need to add and subtract gaskets in different thickness combinations until you get a slight drag on the steering shaft. This is best done with the sector shaft removed. Then after the preload is set on the bearings, the lash on the worm and sector can be adjusted.
Hope that helps.
Neal