ANNUAL REPORT 2006

P L AT I N U M A U S T R A L I A A N N U A L R E P O R T 2 0 0 6
DIRECTORS’ REPORT
The Company paid legal fees on normal commercial
terms to Blakiston & Crabb, a legal firm of which Mr
Blakiston, a director of the Company, is a partner. The
amount paid by the Company for the year ended 30
June 2006 to Blakiston and Crabb was $49,370 (2005:
$72,822).
During the year, an amount of $30,353 (2005:
$22,154) was paid to a director related entity, Allchurch
Communications, which is a business operated by
the daughter of Mr Allchurch. This amount included,
in addition to consultancy fees, reimbursement of
associated costs such as graphic design and printing
costs.
C
Service Agreements
Remuneration and other terms of employment for the
Managing Director are formalised in an employment
contract with the Company pursuant to which he received
a salary of $283,500 and statutory superannuation
of $12,139. Options issued to Mr Lewins contain
performance hurdles which must be achieved before
they can be exercised, therefore enhanced corporate
performance will return a financial benefit to Mr Lewins
via those options. Performance hurdles are determined
by the Board.
Messrs Allchurch, Blakiston, Hughes, and Hansen
receive fees in cash, the fees are fixed and approved
by shareholders and are not related to the performance
of the Company. The Company’s Constitution provides
that directors may collectively be paid a fixed sum not
exceeding the aggregate maximum per annum from
time to time as determined by the Company. A director
may be paid fees or other amounts as the directors
determine where a director performs special duties or
otherwise performs services outside the scope of the
ordinary duties of a director.
D Share-based Compensation
Options are granted under the Company Employee
Share Option Plan for no consideration. Options are
granted for a five year period and entitlements to the
options are vested as soon as performance conditions
have been met. Options are exercisable in defined
tranches with conditions attaching to each tranche to
reflect the Company’s development strategy and align
the interests of Directors and executives to those of
shareholders.
The amounts disclosed for emoluments relating to
options are the assessed fair values at grant date of
options granted to Directors and other executives,
allocated equally over the period from grant date to
expiry. Fair values at grant date are independently
determined using the Binomial Tree Model method of
valuation that takes into account the exercise price,
the term of the option, the vesting and market related
criteria, the impact of dilution, the non-tradeable nature
of the option, the share price at grant date and the risk
of the underlying share and the risk-free interest rate for
the term of the option.
Issue of Incentive Options
There were no additional options issued to Directors for
the year ended 30 June 2006.
Options granted to Mr Lewins prior to the year ended
30 June 2006 as stated in last year’s Annual Report,
included performance conditions which have now
vested with the exception of milestone 3 below.
• 1,000,000 Options at the time the Company achieves
Milestone 1;
• an additional 750,000 Options at the time the
Company achieves Milestone 2; and
• an additional 750,000 Options at the time the
Company achieves Milestone 3.
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