ASX Statement & Media Release 27 May, 2015 CARDNO APPOINTS CHIEF EXECUTIVE OFFICER The Board of Cardno Limited today announced the appointment of Mr Richard Wankmuller as Chief Executive Officer and Managing Director, commencing 29 June 2015. With more than 30 years international experience in professional engineering services, Mr Wankmuller joins Cardno following an extensive candidate search by the Cardno Board. He was most recently a Director of GHD Group Pty Limited and President of GHD Americas which has expanded from 350 employees in 2011 to approximately 4000 today. Mr Wankmuller has held senior positions in the GHD business and was a member of GHD s Executive management team, which has provided him with a comprehensive understanding of the Australian operating environment. Prior to joining GHD, Mr Wankmuller was a member of Parsons Corporation s global Executive Management Team and Group President of its Water and Infrastructure Group. He was also a director of MWH Global where he fulfilled senior executive roles in the USA, Europe and Australia. Mr Wankmuller holds a Bachelor of Engineering degree from the University of Delaware, a Masters in Civil Engineering from Oregon State University, and has completed the Harvard University Advanced Management Program. Cardno Limited Chairman Mr John Marlay said the Board was impressed by Mr Wankmuller s significant expertise, success in growing professional services businesses, international business experience, and his leadership style and capabilities. We believe he will be a strong contributor and business leader for Cardno, Mr Marlay said. Richard is a disciplined leader, focusses on priorities and performance within the business, and demonstrates a deep understanding of client service delivery. Mr Wankmuller was instrumental in the 2014 merger of GHD Group and Conestoga-Rovers & Associates (CRA) to create an 8500-employee environmental, engineering and construction services consulting group. He helped guide the development of the opportunities, the negotiation and the integration of these businesses to deliver a successful merger and associated financial outcomes. "I am delighted to be appointed as Cardno's CEO, Mr Wankmuller said. Cardno has a strong market position in its chosen sectors of environment and infrastructure. I have been impressed with the leadership team, the capabilities within the business and the opportunities already being pursued to drive enhanced profitability. I am confident of our ability to work our way through the current challenges and realise the potential of Cardno. Mr Marlay praised the significant contribution of Mr Graham Yerbury, Acting CEO and Chief Financial Officer, since January 2015. "We extend our thanks to Graham Yerbury for the strong leadership and tireless endeavour that he has demonstrated since taking over as Acting CEO in Page 1 of 5
January. The team has achieved much in difficult circumstances under his guidance and we are confident they will provide a strong support to Richard as he joins Cardno, he said. Details of Rich Wankmuller s remuneration arrangements are outlined in the attachment. ENDS Contacts: John Marlay Chairman Mobile: +61 (0)405 345 685 About Cardno: Cardno is an ASX200 professional infrastructure and environmental services company, with specialist expertise in the development and improvement of physical and social infrastructure for communities around the world. Cardno s team includes leading professionals who plan, design, manage and deliver sustainable projects and community programs. Cardno is an international company, listed on the Australian Securities Exchange [ASX: CDD]. www.cardno.com. Page 2 of 5
SUMMARY OF KEY TERMS OF EMPLOYMENT CONTRACT 1. APPOINTMENT The appointment is to the position of Chief Executive Officer and Managing Director based at Cardno s corporate headquarters in Brisbane, Queensland. 2. TERM The appointment commences on 29 June 2015. 3. DUTIES The duties of Mr Wankmuller are those expected of a Chief Executive Officer reporting to the Chairman. 4. REMUNERATION Components of Mr Wankmuller s remuneration for FY16 are: a) Fixed Annual Remuneration (FAR) in FY16 Mr Wankmuller will be paid a cash Fixed Annual Remuneration of $950,000 per annum, inclusive of superannuation, effective 29 June 2015. The FAR will be reviewed in August 2016 and annually thereafter. b) Short Term Incentives (STI) FY 2016* A maximum short term cash incentive up to $1,425,000 per annum with the following performance measures; i) Strategic and Corporate Development measures - $950,000. ii) Exceptional Performance Incentive a discretionary payment of up to $475,000 for financial outperformance of the company in excess of budget targets. FY 2017 and 2018 Short term cash incentive based on the following performance measures; (i) (ii) Financial Measures - based on the financial performance of the company against specific measures including profitability, balance sheet strength, working capital efficiency and cash conversion. Qualitative Measures - based on an assessment of individual performance against specific non- financial measures including, safety, executive development and leadership. (iii) Exceptional Performance Incentive a discretional payment financial outperformance of the company in excess of the measures in (i) above. Page 3 of 5
c) Long Term Incentive (LTI) FY2016* Performance Rights equivalent to 60% of FAR subject to shareholder approval at the 2015 AGM. Any Performance Rights issued would be subject to specific EPS and TSR performance hurdles, a three (3) year vesting period from the date of grant and Mr Wankmuller s continuing employment with the company at the time of vesting. Mr Wankmuller s eligibility to receive LTI will be effective as at 1 July 2015. FY2017 & FY2018 Subject to the discretion of the Board, an award of Performance Rights as a % of FAR under the company s Performance Equity Plan. Any Performance Rights issued would be subject to specific EPS and TSR performance hurdles, a three (3) year vesting period from the date of grant and Mr Wankmuller s continuing employment with the company at the time of vesting. The Board retains the discretion to consider the potential for a portion of the Performance Rights to vest, based on performance, if the Board and Mr Wankmuller mutually agree on his termination from the role as Chief Executive Officer prior to the completion of the three (3) year vesting period. * If a change of control of the company occurs during the term of Mr Wankmuller s employment and he remains employed by the company up until the date the change of control occurs, or otherwise at the discretion of the Remuneration Committee on Mr Wankmuller ceasing to be employed, Mr Wankmuller s unvested STI and LTI awards will vest in full and, in respect of the LTI, may be exercised, irrespective of whether the relevant performance measures have been satisfied. d) One off payments and relocation expenses Mr Wankmuller will be entitled to a one off payment of US$600,000 payable in three separate tranches over three years provided he remains in continued employment with Cardno at specific milestone dates in recognition of his forfeiture of entitlements at his former employer GHD Group. Cardno will also pay Mr Wankmuller s relocation expenses including airfares from the US for Mr Wankmuller and his family, removal and transportation costs, accommodation in Brisbane for a period up to 12 months and financial and non-financial assistance with immigration, visa and tax advice. Such expenses are repayable by Mr Wankmuller on a prorata basis if he voluntarily resigns or his employment is terminated by Cardno within 12 months. 5. TERMINATION Mr Wankmuller may resign at any time on giving twelve (12) months written notice. Cardno may terminate Mr Wankmuller s employment on giving twelve (12) months written notice. Cardno may elect to terminate Mr Wankmuller s employment prior to the end of the notice period and make a payment in lieu of some or all of the notice period subject to the Page 4 of 5
Corporations Act. Mr Wankmuller is also entitled to accrued FAR, accrued but unpaid superannuation contributions and any entitlements in lieu of accrued leave, subject to the Corporations Act. Cardno retains the right to terminate the employment of Mr Wankmuller without any period of notice or pay in lieu in certain circumstances relating to serious misconduct or material breach of his employment contract. Mr Wankmuller will be entitled to a payment equivalent to his notice period if his role is fundamentally changed by way of a substantial diminution in his role or duties or level of responsibility or by a material reduction in the status of his position or by Cardno being delisted from the ASX. 6. OTHER PROVISIONS Mr Wankmuller s contract also contains provisions relating to non-solicitation, confidentiality and non-compete arrangements. Page 5 of 5