PRO-PAC PACKAGING LIMITED — Board/Management Information 2017

Apr 11, 2017

ASX RELEASE

12 April 2017

Grant Harrod Appointed as Chief Executive Officer

The Chairman of Pro-Pac Packaging Limited (ASX: PPG), Mr Ahmed Fahour, today announced the appointment of Grant Harrod as the Company's Chief Executive Officer. Mr Harrod will commence in this role late May 2017.

Mr Fahour said Mr Harrod would replace Mr Brandon Penn, who has been acting CEO of the Company pending the Board's completion of its search for a suitable candidate for the position of CEO. Mr Penn will resume his role as a non-executive director on the Company's Board.

Mr Fahour said the Pro-Pac Board believes Mr Harrod is the right candidate to lead Pro Pac into a new era. "Grant has extensive experience as a CEO of Australian listed companies, and extensive involvement in distribution services, as well as commercial services and FMCG marketing. We also believe he has the personal qualities and vision to ensure that Pro-Pac continues to embrace and benefit from the ongoing developments occurring in its markets, both in Australia and overseas."

Mr Harrod said: "I am delighted to join the Pro-Pac team at a key stage in its journey. I will inherit a business that is ideally poised for growth. The Company has a number of significant opportunities to continue its consolidation of the packaging industry. Pro Pac is well placed to move to its next stage of growth."

On behalf of the Board, Mr Fahour thanked Mr Penn for acting as interim CEO whilst the Board undertook a comprehensive search for its new CEO.

Attachment 1 – Grant Harrod Biography Attachment 2 – CEO Key Employment Terms and Conditions

Attachment 1 – Grant Harrod Biography

Biography – Grant Harrod

Grant is an experienced executive, having held a number of senior leadership roles, including eleven years as CEO/MD for ASX-listed companies.

From 2014 to 2017 Grant was CEO/MD for real estate franchise group, L.J Hooker Limited, successfully re-positioning its business as a leader in the real estate market. Prior to that, from 2009 to 2013, he was CEO/MD of Salmat Ltd (ASX:SLM), successfully transforming the company to Australia's leading multichannel communication services company.

Prior to joining Salmat, Grant spent 13 years with Corporate Express Limited (formerly ASX listed), helping establish Australia's leading business supplies distributor, where he served as CEO/MD for 7 ½ years. Grant's previous roles at Corporate Express included General Manager of Sales and Marketing, GM Operations and GM IT Products.

In all his roles Grant has successfully led both small and large scale businesses through periods of significant change, usually involving development and deployment of technology to enhance the competiveness and operational efficiency of the business.

Grant has a BA from University of NSW, an MBA from Macquarie University's Graduate School of Management and is a Fellow of the Australian Institute of Company Directors. He has served as a director on several boards, in both executive and non-executive capacities.

Attachment 2

Summary of key terms and conditions of Mr Harrod's employment as CEO of PPG:

Commencement date:	29 May 2017.
Term:	No fixed term. Either party may terminate on 6 months'notice.
Total Fixed Remuneration:	$545,000 per annum inclusive of superannuationcontributions, (pro-rated as applicable for the period thatMr Harrod is Chief Executive Officer).
STI, LTI and ESPP:	The CEO is to be further incentivised by way ofparticipation in specific STI and LTI arrangements to beapplicable to him and in PPG's general ESPP, assummarised below. The STI and LTI arrangements willcommence to apply to the CEO from 1 July 2017 andthe reference share price for the determination of hisentitlements under these will be the PPG VWAP for themonths of May and June 2017.
Short Term Incentive (STI):	This will be a 3 year plan, providing for the grant of ashort term incentive (STI) award to the CEO in the formof performance rights of up to 500,000 PPG shares ineach year, the vesting of which will be dependent uponthe achievement by PPG of 10% EBITDA growth perannum, (excluding the benefits of acquisitions andadjusted for large capital expenditures). It will alsorequire an improvement of one percentage point perannum in PPG's working capital, (calculated on a rolling12 month inventory as a percentage of sales basis), soas to ensure a particular emphasis on management ofinventory. The CEO's participation in the STI will besubject to any necessary shareholder approval at theupcoming PPG Annual General Meeting.
Long Term Incentive (LTI):	This will also be a 3 year plan, providing for the grant ofa long term incentive (LTI) award to the CEO in the formof performance rights of up to 500,000 PPG shares perannum, with the issue (or holding of these shares intrust as applicable) and the vesting of which will occurprogressively at the end of year 3 (post audited andannounced results for the year ending 30 June 2020),and after each year after that, (so that year 3 shares willbe received in year 6), and vesting under the LTI willfurther be dependent upon the following:
	the achievement by PPG of a minimum 10%TSR (total shareholder return) increase eachyear (comprising PPG share priceimprovement and dividend), save that, if in

year 1 a 10% TSR is not achieved, the CEO

		will have a 2nd year to achieve a 20% TSR;and
		by the end of year 3 the PPG share price mustbe at least $0.55 on a VWAP basis over athree-month period for the vesting of year 1shares, and must similarly be at as that priceon the same basis, for each of the 2proceeding years of the LTI.
		The CEO's participation in the LTI will besubject to any necessary shareholder approvalat the upcoming PPG Annual GeneralMeeting.
ESPP:		The CEO will further be entitled to participate in PPG'sESP Plan in respect of 1 million shares per annum for 3years, with the share price condition to be the same asfor all other PPG employees participating in this plan atthe end of each year. The CEO's first participation willbe at the end of year 1 for the year ending 30 June2018. The CEO's participation in the ESPP will besubject to any necessary shareholder approval at theupcoming PPG Annual General Meeting.
Change of Control:		If there is a change of control event in respect of PPG,the Board will have the discretion to determine that theCEO's LTI awards will vest.
		In that regard and recognising the limitations under theCorporations Act relating to the value of terminationbenefits payable by companies to senior managementon termination of their employment and the rulesapplicable in that regard, if within 2 years of a change ofcontrol event in respect of PPG, PPG materially andsubstantially changes the CEO's duties to duties otherthan those ordinarily performed by a CEO, he mayserve written notice on the Company's Board indicatingthat he considers it to be a material breach of hisemployment agreement with PPG and that he elects tobring his employment to an end. If PPG has repudiatedhis agreement and it is thereby brought to an end,following service of the above notice on the PPG board,the CEO will be entitled to receive a benefit equivalentto 12 months base salary in lieu of notice.

Ends