2009 ANNUAL REPORT
ABN 61 123 156 089
www.manhattancorp.com.au
CORPORATE DIRECTORY
DIRECTORS & OFFICERS
Mr Alan J Eggers
Executive Chairman
B.Sc, B.Sc(Hons), M.Sc, F.S.E.G., MAusIMM, MAIG
Dr Robert Wrixon
B.Eng(Hons) M.Eng, PhD, GAICD
Mr Marcello Cardaci
B.Juris, LLB, B.Com
Mr John A G Seton
LLM(Hons)
Robert (Sam) Middlemas
B.Com, CA, Grad. Dip. Acc
Managing Director
Non Executive Director
Non Executive Director
Company Secretary
BUSINESS OFFICE
Ground Floor
15 Rheola Street
WEST PERTH WA 6005
PO Box 1038
WEST PERTH WA 6872
Telephone:
Facsimile:
REGISTERED OFFICE
Ground Floor
15 Rheola Street
WEST PERTH WA 6005
+61 8 9322 6677
+61 8 9322 1961
INTERNET ACCESS
Email:
Web Site:
info@manhattancorp.com.au
www.manhattancorp.com.au
COUNTRY OF INCORPORATION
Australia
STOCK EXCHANGE LISTING
Australian Securities Exchange (“ASX”)
ASX CODE:
MHC
SHARE REGISTRY
Computershare Investor Services Pty Ltd
Level 2, Reserve Bank Building
45 St Georges Terrace
PERTH WA 6000
Investor Enquiries:
Facsimile:
Web Site:
1300 307 518
+61 8 9323 2033
www.computershare.com.au
AUDITORS
BDO Kendalls
128 Hay Street
SUBIACO WA 6008
SOLICITORS
Blakiston & Crabb
1202 Hay Street
WEST PERTH WA 6005
BANKERS
Westpac Banking Corporation
109 St Georges Terrace
PERTH WA 6000
CORPORATE ADVISERS
Gresham Advisory Partners Limited
PERTH WA 6000
CONTENTS
Chairman’s Review
Review of Operations
Directors’ Report
Auditor’s Report
Auditor’s Declaration
Financial Statements
Income Statement
Balance Sheet
Statement of Cash Flows
1
3
7
16
18
19
19
20
21
Statement of Recognised Income and Expense 22
Notes to the Financial Statements
Directors’ Statement
Corporate Governance Statement
ASX Additional Information
Analysis of Shareholdings
Tenement Schedule
23
40
41
52
52
55
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
CHAIRMAN’S REVIEW
________________________________________________________________________________
Ground Floor
15 Rheola Street
West Perth WA 6005
PO Box 1038
West Perth WA 6872
Tel:
Fax:
Email:
+61 8 9322 6677
+61 8 9322 1961
info@manhattancorp.com.au
12 October 2009
Dear Shareholders and Investors
I am pleased to present to you Manhattan’s Annual Report and Financial Statements for the year ended 30 June 2009.
It has been a successful year for your Company with a number of positive developments despite the Global Financial
Crisis and the negative market sentiment for uranium assets. During the year the uranium spot price has continued its
retreat, coming back from a high of US$65 pound in mid 2008 to around US$45 pound by mid 2009. By early 2009 there
were signs the worst was over in our sector and commodity prices began to stabilise and financial and equity markets
commenced a real, but modest, recovery. On the positive side these market conditions, and the merger and acquisition
activity of the majors, created acquisition opportunities at more realistic valuations that has resulted in Manhattan
consolidating its assets and acquiring an advanced uranium asset.
Following this, the most significant development during the year was the completion of the merger with the private equity
fund Manhattan Resources Pty Ltd. The merger plans were announced in early June 2009 and completed with
shareholder endorsement on 20 July 2009. The merged entity now has the management expertise, experience and
funding required to underpin our future growth and development needs.
Manhattan is now a company that is attracting the attention of investors and fund managers both within Australia and
internationally. The company has emerged with a substantial uranium resource at Double 8, real exploration upside
potential to be drill tested within the expanded Ponton project in WA, is debt free, well funded, has a stable share register
and 100% ownership of key projects.
In May 2009 Manhattan reported a maiden 10.9Mlb JORC Inferred Resource and a further drilled Mineralised Potential of
6.6Mlb to 15.4Mlb of uranium oxide for the Double 8 deposit. We are confident, from our review of the previous extensive
drilling in our Ponton project area by PNC Corporation in the early 1980’s, there remains substantial exploration upside yet
to be drill tested at Double 8 and along the palaeochannels within our tenements at Ponton, that will expand on this
resource base.
Manhattan’s strategy for growth is to expand the Double 8 resource and advance the uranium deposit to mine
development stage and drill testing a series of other known uranium anomalies in the Ponton project area. As well merger
and acquisition opportunities, in a number of countries to acquire additional quality uranium resources that can be
developed into producing mines in the near term, are being evaluated.
Shareholder support has been excellent as we worked to transition the Company to a uranium company with a significant
resource base and assets with mine development potential. This has recently attracted the attention of key Australian and
international resource and specialist uranium funds in Sydney, Hong Kong and London and resulted in them taking up
significant positions on the Company’s share register.
Manhattan now has an experienced Board and a well qualified management, technical and administrative team that
previously built Summit Resources Limited into one of Australia’s premier uranium companies and an ASX Top 200
company. Summit had a market capitalisation of $1.2 billion at the time it was taken over by Paladin Energy Ltd in May
2007, at the height of the last commodity boom and bull market.
Your Company is well funded to achieve its medium term objectives with over $9.5 million in cash and investments in ASX
listed uranium companies. As the merger was finalised after the end of the Financial Year the Financial Statements
presented in this Annual Report reflect the position of your Company at 30 June 2009, prior to completion of the merger.
The merger included the issue of 44.2 million new ordinary shares bringing the issue capital of Manhattan to 83.5 million
shares and the acquisition of the cash and liquid investments held by Manhattan Resources Pty Ltd. Manhattan
Corporation Group’s financial position now is more accurately reflected in the post merger unaudited Balance Sheet as at
21 July 2009. This Balance Sheet (see page 2) on consolidation of the two entities had, at 21 July 2009, around $2.6
million in bank cash deposits and $6.8 million of liquid investments in ASX listed uranium companies.
1
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
CHAIRMAN’S REVIEW
________________________________________________________________________________
MANHATTAN CORPORATION GROUP
As at 21 July 2009 on Completion of Merger
UNAUDITED BALANCE SHEET
Manhattan
Corporation
Limited
Manhattan
Resources Pty
Ltd
Consolidation
Adjustments
Consolidated
Manhattan
Group
ASSETS
$
$
$
$
Current Assets
Cash and Cash Equivalents
Investments in ASX Listed Companies
Trade and Other Receivables
Total Current Assets
Non Current Assets
Property, Plant and Equipment
Exploration and Evaluation Expenditure
Investment in Manhattan Resources Pty Ltd
Total Non Current Assets
946,990
-
58,930
1,005,920
1,855
2,172,506
7,396,843
9,571,204
1,670,111
6,816,451
8,223
8,494,785
-
-
-
-
-
-
-
-
-
-
(7,396,843)
(7,396,843)
2,617,101
6,816,451
67,153
9,500,705
1,855
2,172,506
-
2,174,361
TOTAL ASSETS
10,577,124
8,494,785
(7,396,843)
11,675,066
LIABILITIES
Current Liabilities
Trade and Other Payables
Provisions
Total Current Liabilities
194,541
2,736
197,277
63,236
1,034,706
1,097,942
TOTAL LIABILITIES
197,277
1,097,942
NET ASSETS
10,379,847
7,396,843
-
-
-
-
-
257,777
1,037,442
1,295,219
1,295,219
10,379,847
EQUITY
Contributed Capital
Reserves
Accumulated Losses
13,397,543
645,505
(3,663,201)
5,020,000
(5,020,000)
13,397,543
-
-
645,505
2,376,843
(2,376,843)
(3,663,201)
TOTAL EQUITY
10,379,847
7,396,843
(7,396,843)
10,379,847
Manhattan is focused on advancing its key uranium project at Ponton, expanding and upgrading the confidence levels of
the reported Double 8 resource and presenting these results clearly to Australian and international investors. In addition,
by utilising the extensive database Manhattan has developed, corporate opportunities already identified to acquire quality
uranium resources, and grow the Company, will also be undertaken to generate shareholder wealth.
I will take the opportunity to thank the Board, executive management team and staff for their support, professional
approach and enthusiasm that has resulted in a very successful outcome and created a Company that is now well
positioned to deliver on behalf of its investors. This appreciation is also extended to all investors and shareholders, as your
support is critical in building a new enterprise in its formative years. Thank you.
We are already enjoying the challenge of building the enterprise and generating wealth for our shareholders. We look
forward to reporting further positive exploration results and progress with corporate developments in the near term.
We look forward to your support as we move through the project generation and acquisition phase. The simple aim is to
advance Manhattan’s interests by recognising opportunities, unlocking value in our projects and delivering growth in
shareholder wealth.
ALAN J EGGERS
Executive Chairman
12 October 2009
2
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
REVIEW OF OPERATIONS
________________________________________________________________________________
INTRODUCTION
During the year under review Manhattan focused on acquiring an advanced uranium project and exploring its four uranium
project areas located in Western and South Australia. The Company was successful in acquiring the Double 8 uranium
deposit and has now emerged with a substantial uranium resource and exploration potential at Ponton in WA (see figure
1).
On 5 May 2009 Manhattan announced a significant uranium oxide resource of 10.9Mlb and a further drilled potential of
6.6Mlb to 15.4Mlb for the Double 8 deposit. There remains substantial exploration upside yet to be drill tested at Double 8
that will expand this resource base.
The Company has also previously undertaken drilling on the Siccus uranium project located in the Frome Basin of South
Australia between the Honeymoon and Beverley uranium mines and airborne geophysical surveys over the Gardner
Range project in the highly prospective Tanami region of Western Australia.
Manhattan’s strategy for growth is to advance its key uranium project at Ponton, expand and upgrade the confidence
levels of the reported resource and advance the Double 8 uranium deposit to mine development stage. As well, by utilising
the extensive database Manhattan has developed, target corporate opportunities identified to acquire quality uranium
resources, that can be developed into producing mines in the near term, to grow the Company are also being pursued.
Figure 1: Manhattan’s Australian Projects
REVIEW OF PROJECTS
1.
PONTON PROJECT (WA)
Interest: Manhattan 100%
Operator: Manhattan Corporation Limited
Manhattan’s Ponton project is located approximately 200km east northeast of Kalgoorlie on the edge of the Great
Victoria Desert in WA. The Company holds around 1,650km2 of applications and granted exploration tenements
underlain by Tertiary palaeochannels within the Gunbarrel Basin that are known to host a number of uranium
deposits and drilled uranium anomalies.
The Ponton system of palaeochannels hosts the 11Mlb Double 8 uranium deposit as well as the known drilled
uranium anomalies at Ponton Creek, Highway Channel and Shelf
tenements. These
palaeochannels connect with the lignite hosted Mulga Rock uranium deposits where Energy and Minerals Australia
has recently released an initial inferred resource estimate of 24,520 tonnes (54Mlb) uranium oxide (see Figure 2).
in Manhattan’s
3
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
REVIEW OF OPERATIONS
REVIEW OF PROJECTS (continued)
Figure 2: Ponton Project (WA)
Manhattan’s Double 8 uranium deposit is located in tenement application E28/1898 in the southwest of the project
area within the Queen Victoria Spring Nature Reserve.
Drilling by PNC within the Queen Victoria Spring Nature Reserve in 1983 discovered sandstone hosted uranium
mineralisation at the Double 8 prospect. Additional drilling within the palaeochannel system identified the Ponton
Creek, Highway Channel and Shelf Prospects. Approximately 100 holes were drilled and radiometric gamma
logged in the Nature Reserve between 1983 and 1986, of which 44 were in the Double 8 area.
The Double 8 deposit is sandstone hosted tabular type uranium body in the lower parts of the palaeodrainage
system (40 to 70m depth) in reduced sands potentially amenable to in situ leach recovery (“ISL”). The Double 8
uranium mineralisation was drill intersected along approximately nine kilometres of palaeodrainage, at widths of
approximately 500m on average, with down hole thicknesses of 3 to 25 meters.
The Shelf anomaly is lignite hosted similar to the Mulga Rock deposits. Manhattan completed 74 holes for 4,630
metres of reconnaissance drilling along the palaeochannels in its granted exploration tenements, to the north of the
Queen Victoria Springs Nature Reserve, in September 2008.
During the year, Manhattan acquired Deep Yellow Ltd’s 30% interest in the five granted tenements at Ponton.
Manhattan now holds 100% interest in the five granted and two exploration tenement applications at Ponton.
2.
DOUBLE 8 URANIUM DEPOSIT (WA)
Interest:
Operator: Manhattan Corporation Limited
100%
On 5 May 2009 Manhattan reported a maiden Inferred Resource Estimate for the Double 8 uranium deposit at
Ponton in Western Australia of 16Mt at 310ppm uranium oxide (“U3O8”) containing 10.9Mlb U3O8 at a 200ppm
cutoff. In addition, the Exploration Results reported identified further Mineralisation Potential at Double 8 of between
6.6 and 15.4Mlb of U3O8 at the 200ppm cutoff.
4
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
REVIEW OF OPERATIONS
REVIEW OF PROJECTS (continued)
The reported resource and mineralised potential, based on PNC’s drilling in the 1980’s are summarised as follows:
DOUBLE 8 INFERRED RESOURCE ESTIMATES
CUTOFF GRADE
eU3O8(ppm)
100
150
200
250
300
350
400
TONNES (MILLION)
GRADE eU3O8(ppm)
TONNES U3O8(t)
59
28
16
9
6
4
3
180
250
310
370
410
450
490
10,620
7,000
4,960
3,330
2,460
1,800
1,470
POUNDS (MILLION)
U3O8(Mlb)
23.4
15.4
10.9
7.3
5.4
4.0
3.2
DOUBLE 8 ADDITIONAL MINERALISED POTENTIAL
CUTOFF GRADE
eU3O8(ppm)
100
150
200
250
300
350
400
TONNAGE RANGE
(MILLION)
40 - 80
20 - 40
10 - 20
5 - 10
3 - 5
2 - 3
1 - 2
GRADE RANGE
eU3O8(ppm)
100 - 200
200 - 250
300 - 350
350 - 400
400 - 450
450 - 550
550 - 600
TONNAGE RANGE U3O8(t)
4,000 - 16,000
4,000 - 10,000
3,000 - 7,000
1,750 - 4,000
1,200 - 2,250
900 - 1,650
550 - 1,200
POUNDS RANGE (MILLION)
U3O8(Mlb)
8.8 - 35.3
8.8 - 22.0
6.6 - 15.4
3.9 - 8.8
2.6 - 5.0
2.0 - 3.6
1.2 - 2.6
The Double 8 uranium deposit of 10.9Mlb U3O8 is a significant resource and already places the deposit as the
twenty second largest reported uranium resource in Australia and the ninth largest in Western Australia.
The fact that the uranium mineralisation at Double 8 remains open and is yet to be closed off by drilling along with
the additional Mineralisation Potential reported of between 10 and 20 million tonnes with a grade range between
300 to 350ppm eU3O8 indicates that there is considerable exploration upside for the Double 8 deposit.
The Company considers that with further exploration, drilling and sampling at Double 8, and along the Ponton
palaeochannels, the resource estimates will expand and the confidence levels of these estimates will improve and
report to higher categories under the JORC (2004) Code.
Our priority is now to obtain the grant of E28/1898 at Ponton and gain exploration access to the area to enable the
recommencement of drill testing and evaluation of the uranium resources identified at Double 8 and to further test
the uranium anomalies identified from earlier work.
3.
SICCUS PROJECT (SA)
Interest: Manhattan 90%
Operator: Manhattan Corporation Limited
The Siccus project covers part of the Tertiary palaeochannel system in the Frome Basin of SA. Manhattan’s
exploration licence covers an area of 672km2 of this highly prospective uranium province. The target at Siccus is
sandstone hosted uranium mineralisation, similar to the nearby deposits at Beverley, Four Mile and Honeymoon.
Drilling by the Company in 2008 intersected both the Namba and Eyre Formations, the sediments that host the
Frome Basin uranium mines and deposits. As well, historic radiometric anomalies of 14 times background were
recorded in the Namba clays. Planned follow up drilling will test for uranium mineralisation within the prospective
sediments on the eastern side of the Siccus palaeochannel.
During the year Manhattan acquired Deep Yellow Ltd’s 20% interest in the Siccus project tenements. Signature
Resources Pty Ltd maintains a 10% carried interest in the project.
4.
GARDNER RANGE PROJECT (WA)
Interest: Manhattan 100%
Operator: Manhattan Corporation Limited
The Gardner Range project is located in the Tanami region of WA. Here the Company holds four granted
exploration licences that border the NT and cover 542km2. The target is Athabasca Basin style unconformity related
uranium mineralisation. Historic drilling at the Don uranium prospect, in Manhattan’s tenement, intersected 0.44m of
1.5% U3O8 and 1.7g/t gold at a depth of 40m in graphitic shale on the unconformity.
5
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
REVIEW OF OPERATIONS
REVIEW OF PROJECTS (continued)
Recent airborne geophysical surveys have identified significant uranium channel anomalies (including at the Don)
that are coincident with zones of illite clay alteration often associated with hydrothermal mineralising events. In
addition, a VTEM survey located a conductive unit directly below the Don prospect, further supporting the
unconformity model for the uranium mineralisation in the area and delineating a number of new drill targets.
Manhattan also acquired Deep Yellow Ltd’s 30% interest in the Gardner Range project during the year.
5.
ANKETELL PROJECT (WA)
Interest: Manhattan 0%
As part of the review and rationalisation of Manhattan’s projects during the year the Company divested of its entire
interest in the Anketell project to Deep Yellow Ltd.
ACQUISITIONS AND GENERATIVE
Over the last year the Company has focused on evaluating its projects, acquisition of an advanced uranium resource and
funding needs to create shareholder value going forward. Manhattan has now emerged with a substantial uranium
resource and exploration potential at Ponton in WA, 100% ownership of its three uranium projects, is well funded and debt
free.
In addition, by utilising the extensive database Manhattan has developed, corporate opportunities have been identified that
are being pursued to acquire additional quality uranium resources to grow the Company.
SUMMARY
The Company’s priority is now to advance its key uranium project at Double 8. On the grant of E28/1898, the Company will
recommence drilling at Double 8 with a $4 million, 60,000 metre, drilling program. This 1,000 hole program is designed to
expand the reported Inferred Resource and convert the reported Mineralised Potential to Inferred Resource status.
Acquisition of further quality advanced uranium resources, that are likely to result in near term mine development
opportunities, will continue to be evaluated. These acquisitions may be by either acquiring direct equity in the project or by
takeover and or merger of the corporate entity holding the asset.
ROBERT WRIXON
Managing Director
12 October 2009
COMPETENT PERSON’S STATEMENT
The information in this report that relates to reported Exploration Results, Mineral Resources or Ore Reserves is based on
information compiled by Alan J Eggers who is a Corporate Member of the Australasian Institute of Mining and Metallurgy and is an
executive director of the Company. Alan J Eggers is a professional geologist and has sufficient experience that is relevant to the
style of mineralisation and type of deposits under consideration and to the activity which he is undertaking to qualify as a Competent
Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves”. Mr Eggers consents to the inclusion in this report of the matters based on his information in the form and context in
which it appears.
6
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
DIRECTORS’ REPORT
The Directors have pleasure in presenting their Annual Report and Financial Statements for Manhattan Corporation
Limited (“Manhattan”) (formerly Uranio Limited) for the year ended 30 June 2009.
PRINCIPAL ACTIVITIES
The principal continuing activity of Manhattan during the year was mineral exploration and development and evaluation of
mineral projects and corporate opportunities in the resource sector world wide.
There has been no significant change in the nature of Manhattan’s business activities during the year under review.
OPERATING RESULTS
The loss of the Company for the year, after provision for income tax, amounted to $3,223,240 (2008: $374,333)
DIVIDENDS
No dividend has been paid or recommended by the Directors since the commencement of the year.
REVIEW OF OPERATIONS
Manhattan (formerly Uranio Limited) listed on the Australian Securities Exchange (“ASX”) on 29 January 2008 following an
Initial Public Offering that raised $4,586,000. The Company had acquired interests in one uranium exploration project in
South Australia and three uranium exploration projects in Western Australia.
Since listing on ASX to 30 June 2009 the Company undertook field exploration and drilling on the Siccus project in SA, the
Ponton project in WA, airborne and field surveys and evaluation of the Gardner Range project in WA and divested of its
interests in the Anketell project in WA. As well, the Company acquired 100% interest in the Gardner Range and Ponton
projects, 90% interest in the Siccus project, retired all debt and acquired the Double 8 uranium deposit in WA.
Manhattan announced a maiden resource for the Double 8 uranium deposit on 5 May 2009 and a proposed merger with
Manhattan Resources Pty Ltd on 3 June 2009.
A review of operations for the Financial Year, together with future prospects that form part of this Report, are presented in
the Chairman’s Review and the Review of Operations on pages 1 to 6 of this Annual Report.
Manhattan will continue to advance its exploration and development projects and examine opportunities in the resource
sector, with particular focus on advanced uranium projects, with the potential to deliver an early cash flow or a substantial
uplift in shareholder value.
During the period since listing on ASX, to the end of the Financial Year, the Company has used its cash reserves in a way
consistent with its business objectives detailed in its Initial Public Offering Prospectus dated 29 October 2007.
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
The Company completed a merger with Manhattan Resources Pty Ltd on 21 July 2009, which has led to a number of new
shares being issued (refer Matters Subsequent to the End of Financial Year below).
MATTERS SUBSEQUENT TO THE END OF THE FINANCIAL YEAR
On 21 July 2009, the Company completed a merger with Manhattan Resources Pty Ltd, following shareholders approval. It
was also agreed to change the Company name to Manhattan Corporation Limited at that meeting. As a consequence of
the merger, the Company has issued a total of 44,201,640 new shares and a number of new Director, employee and
consultant options, and cancelled a number of options. Mr Alan Eggers has also joined the Board as Executive Chairman
and Mr John Seton as a Non Executive Director, and Mr David Riekie resigned from the Board. At the date of the merger
Manhattan Resources Pty Ltd held cash and liquid securities with a value in excess of $8 million.
Other than the matter discussed above, there has not arisen in the interval between the end of the Financial Year and the
date of this report any item, transaction or event of a material nature, in the opinion of the Directors of the Company, to
affect significantly the operation of the Company, the results of those operations, or the state of affairs of the Company in
future Financial Years.
7
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
DIRECTORS’ REPORT
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
There is no likely or expected change to the operations of the Company to systematically explore the Company’s key
projects, in particular the Ponton projects. The Company will continue to review all business development opportunities
that present themselves in an effort to enhance the exploration portfolio. This activity may or may not lead to future
acquisitions, divestments, joint ventures and other changes to the Company’s exploration portfolio.
ENVIRONMENTAL OBLIGATIONS
The Company operates within the resources sector and conducts its business activities with respect for the environment
while continuing to meet the expectations of the shareholders, employees and suppliers. The Company’s exploration
activities are currently regulated by significant environmental regulation under laws of the Commonwealth and states and
territories of Australia. The Company aims to ensure that the highest standard of environmental care is achieved, and that
it complies with all relevant environmental legislation. The Directors are mindful of the regulatory regime in relation to the
impact of the organisational activities on the environment. There have been no known breaches by the Company during
the Financial Year.
CORPORATE GOVERNANCE
In recognising the need for the highest standards of corporate behaviour and accountability, the Directors of Manhattan
support and have adhered to the principles of corporate governance. Manhattan’s Corporate Governance Statement is
contained in this Annual Report.
DIRECTORS AND COMPANY SECRETARY
The following persons held office as Directors and Company Secretary of Manhattan during the year. All Directors and the
Company Secretary were in office for the entire period unless otherwise stated:
Alan J Eggers
Robert Wrixon
Marcello Cardaci
John A G Seton
David Riekie
Robert (Sam) Middlemas
Appointed 20 July 2009
Appointed 20 July 2009
Resigned 20 July 2009
Appointed 3 March 2009
PROFILE OF DIRECTORS AND COMPANY SECRETARY
Alan J Eggers B.Sc, B.Sc(Hons), M.Sc, F.S.E.G., MAusIMM, MAIG
EXECUTIVE CHAIRMAN
Alan Eggers is a professional geologist with over 30 years of international experience in exploration for uranium, base
metals, precious metals and industrial minerals. He was the founding director and managing director for 20 years of listed
uranium company Summit Resources Limited. He built Summit into an ASX top 200 company with a market capital of $1.2
billion until its takeover by Paladin Energy Ltd in May 2007 when he resigned from the board. His professional experience
has included management of mineral exploration initiatives and corporate administration of private and public companies.
Alan is managing director of Wesmin Consulting Pty Ltd, a director of ASX listed Zedex Minerals Limited (1 May 2007 to
current), was a founding director of the Australian Uranium Association and holds a number of directorships in private
companies.
Robert Wrixon B.Eng(Hons), M.Eng, PhD, GAICD
MANAGING DIRECTOR
Robert Wrixon has 15 years industry experience and holds an honours degree in chemical engineering from Princeton
University and a PhD in mineral engineering from the University of California, Berkeley. Robert was previously with Xstrata
where he spent five years in marketing, energy policy, corporate strategy and business development (M&A) for both
Xstrata Coal in Sydney and Xstrata plc, based in London. He served as Xstrata’s representative on the board of CMC Ltd,
the coal marketing company for the Cerrejon joint venture in Colombia. Prior to joining Xstrata, he was project manager for
Mars & Co, a global strategy consulting firm working at client sites in the USA, Australia and Japan. He holds no other
directorships.
Marcello(cid:3)Cardaci(cid:3)B.Juris,(cid:3)LLB,(cid:3)B.Com(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)(cid:3)
NON(cid:3)EXECUTIVE(cid:3)DIRECTOR(cid:3)
Marcello Cardaci is a partner in the Australian legal practice of Blakiston & Crabb. Mr Cardaci holds degrees in law and
commerce and is experienced in a wide range of corporate and commercial matters with a particular emphasis on public
and private equity raisings and mergers and acquisitions. Blakiston & Crabb specialises in the provision of legal advice to
companies involved in various industries including resources and manufacturing. Mr Cardaci is a non executive chairman
of Tianshan Goldfields Limited (2 February 2009 to current), and non executive director of Forge Group Limited (4 June
2007 to current) and Sphere Investments Limited (2 June 1999 to current).
8
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
DIRECTORS’ REPORT
John A G Seton LLM(Hons)
NON EXECUTIVE DIRECTOR
John Seton is an Auckland based solicitor with extensive experience in commercial law, stock exchange listed companies
and the mineral resource sector. He is the Executive Chairman of ASX listed Zedex Minerals Limited (23 October 2003 to
current) and NZX listed SmartPay Limited (May 2006 to current), a director and former President of TSX listed Olympus
Pacific Minerals Inc (July 1999 to current), former director and Chairman of Summit Resources Limited (until May 2007)
and holds or has held directorships in several companies listed on the Australian and New Zealand Stock Exchanges
including Kiwi Gold NL, Kiwi International Resources NL, Iddison Group Vietnam Limited and Max Resources NL. John
was also the former chief executive of IT Capital Limited.
Mr Seton is also the former Chairman of the Vietnam/New Zealand Business Council and holds a number of private
company directorships including Chairman of The Mud House Wine Group Limited, an unlisted public company.
Robert (Sam) Middlemas B.Com, CA, Grad. Dip. Acc
COMPANY SECRETARY
Sam Middlemas was appointed Company Secretary and Chief Financial Officer on 3 March 2009. Sam is a chartered
accountant with more than 15 years experience in various financial and company secretarial roles with a number of listed
public companies operating in the resources sector. He is the principal of a corporate advisory company which provides
financial and secretarial services specialising in capital raisings and initial public offerings. Previously Mr Middlemas
worked for an international accountancy firm. His fields of expertise include corporate secretarial practice, financial and
management reporting in the mining industry, treasury and cash flow management and corporate governance.
REMUNERATION REPORT
The remuneration report for the Financial Year ended 30 June 2009 is set out under the following main headings:
(A)
Principles Used to Determine the Nature and Amount of Remuneration;
(B)
Details of Remuneration;
(C)
Service Agreements;
(D)
Share Based Compensation;
(E)
Additional Information; and
(F)
Loans to Directors and Executives.
The information provided in this remuneration report has been audited as required by section 308(3C) of the Corporations
Act 2001.
(A)
Principles Used to Determine the Nature and Amount of Remuneration
The primary functions of the Remuneration Committee are to:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
make specific recommendations to the Board on remuneration of Director’s and senior officers;
recommend the terms and conditions of employment for the Managing Director;
undertake a review of the Managing Director’s performance, at least annually, including setting with the
Managing Director goals for the coming year and reviewing progress in achieving those goals;
consider and report to the Board on the recommendations of the Managing Director on the remuneration of
all direct reports; and
develop and facilitate a process for Board and Director evaluation.
The Board has elected not to establish a remuneration committee based on the size of the organisation and has
instead agreed to meet as deemed necessary and allocate the appropriate time at its regular Board meetings.
Non Executive Directors
Fees and payments to Non Executive Directors reflect the demands which are made on, and the responsibilities of,
the Directors. Non Executive Directors’ fees and payments are reviewed annually by the Board. The Chairman’s
fees are determined independently to the fees of Non Executive Directors based on comparative roles in the
external market. The Chairman is not present at any discussions relating to determination of his own remuneration.
9
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
DIRECTORS’ REPORT
Directors’ Fees
The current base remuneration was reviewed in March 2009 in light of current conditions and the cash reserves of
the Company. The Chairman's remuneration is inclusive of committee fees while other Non Executive Directors
who chair, or are a member of, a committee are not entitled to receive additional yearly fees.
Non Executive Directors’ fees are determined within an aggregate Directors’ fee pool limit, which is periodically
recommended for approval by shareholders. The maximum currently stands at $200,000 per annum.
The following fees have applied during the Financial Year:
Base Fees
2009
Chairman
Non Executive Directors
Additional Fees
$50,000 (reduced to $35,000 from 1 March 2009)
$35,000 (reduced to $20,000 from 1 March 2009)
A Director may also be paid fees or other amounts as the Directors determine if a Director performs special duties
or otherwise performs services outside the scope of the ordinary duties of a Director. A Director may also be
reimbursed for out of pocket expenses incurred as a result of their directorship or any special duties.
Retirement Allowances for Directors
Superannuation contributions required under the Australian superannuation guarantee legislation (currently 9%) are
made in addition to Directors’ overall fee entitlements.
Executive Pay
The executive pay and reward framework has two components:
(cid:120)
(cid:120)
base pay and benefits, including superannuation; and
long term incentives through issue of share options.
The combination of these comprises the executive’s total remuneration. The Company revisits its long term equity
linked performance incentives for executives as deemed necessary by the Board. The equity linked performance
incentives take the form of share options to provide incentives for the Directors and senior management to drive
shareholder value through growth in share price.
Base Pay
Structured as a total employment cost package which may be delivered as a combination of cash and prescribed
non financial benefits at the executives’ discretion. Executives are offered a competitive base pay that comprises
the fixed component of pay and rewards. Base pay for executives is reviewed annually to ensure the executive’s
pay is competitive with the market. An executive’s pay is also reviewed every 12 months and will be adjusted in line
with the executive’s performance and current market conditions.
Benefits
Executives and Key Management Personnel are entitled to receive additional benefits or allowances.
Long Term Incentives
The executives are entitled to share options as approved by shareholders.
(B)
Details of Remuneration
Amounts of Remuneration
Details of the remuneration of the Directors, the Key Management Personnel (as defined in AASB 124 Related
Party Disclosures) and executives of Manhattan Corporation Limited for the Financial Year are set out in the
following tables.
10
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
DIRECTORS’ REPORT
The Key Management Personnel are the Directors of Manhattan Corporation Limited during the Financial Year
which were:
Mr Marcello Cardaci
Dr Robert Wrixon
Mr David Riekie
Chairman
Managing Director
Non Executive Director
In addition, the following persons must be disclosed under the Corporations Act 2001 as Company executives:
Mr Phil Warren
Mr Sam Middlemas
Company Secretary until his resignation on 3 March 2009.
Company Secretary appointed 3 March 2009 to current.
Directors and Executives Remuneration 2009
Executive Remuneration
Short Term Benefits
Post
Employment
Share Based
Payments
Total
Percentage
Options
30 June 2009
Cash Salary &
Fees
Cash Bonus
Super
Annuation &
Pensions
Options
Non Executive Directors
Marcello Cardaci
David Riekie
Executive Directors
Robert Wrixon
Key Management Personnel
Phil Warren1
Sam Middlemas2
Total Compensation
$
45,000
30,000
241,667
66,150
27,240
410,057
$
-
-
-
-
-
-
$
4,050
2,700
$
-
-
$
49,050
32,700
%
21,750
161,580
424,997
-
-
-
-
28,500
161,580
66,150
27,240
600,137
-
-
38
-
-
-
1
2
Mr Warren resigned as Executive Director on the 22nd April 2008 and continued in capacity of Company Secretary until 3
March 2009. Grange Consulting Group was paid $23,452 under a Consultancy Agreement for Mr Warren’s Executive
Director Services.
Mr Middlemas was appointed Company Secretary on 3 March 2009. All fees were paid under a Consultancy Agreement
with Sparkling Investments Pty Ltd.
Directors and Executives Remuneration 2008
Executive Remuneration
Short Term Benefits
Post
Employment
Share Based
Payments
Total
Percentage
Options
30 June 2008
Cash Salary &
Fees
Cash Bonus
Super
Annuation &
Pensions
Options
Non Executive Directors
Marcello Cardaci1
David Riekie
Executive Directors
Robert Wrixon2
Key Management Personnel
Phil Warren3
$
50,000
23,333
53,977
-
$
38,500
-
-
-
Total Compensation
127,310
38,500
$
7,965
2,100
$
-
-
$
96,465
25,433
%
4,858
18,150
76,985
-
14,923
-
-
18,150
198,883
-
-
23
-
-
1
2
3
Mr Cardaci was paid a one off bonus payment in lieu of work performed outside of his normal scope of duties as Chairman
for the period from incorporation to listing on the ASX.
Dr Wrixon was appointed 14th April 2008.
Mr Warren resigned as Executive Director on the 22nd April 2008 and continued in capacity of Company Secretary until 3
March 2009. Grange Consulting Group was paid $23,452 under a Consultancy Agreement for Mr Warren’s Executive
Director Services.
11
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
DIRECTORS’ REPORT
(C)
Service Agreements
On appointment to the Board, all Non Executive Directors enter into a service agreement with the Company in the
form of a letter of appointment. The letter summarises the Board policies and terms, including compensation,
relevant to the office of Director.
Remuneration and other terms of employment for the Managing Director and Key Management Personnel are
formalised in service agreements. Each of these agreements provide for the provision of performance related
conditions, other benefits including an allocation of options. Other major provisions of the agreements relating to
remuneration are set out below.
All contracts with executives may be terminated early by the Company with 4 months notice or by the executive
with 1 months notice, subject to termination payments, or if conditions set out in services agreements are not met,
then with 10 days or immediately upon payment of fee.
Dr Robert Wrixon, Managing Director
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
Term of agreement. Continues indefinitely until cancelled by the Company or the Executive;
Base Salary, inclusive of superannuation, for the period 1 July 2008 to 31 March 2009 was $272,500, which
was voluntarily reduced to $245,250 for the remainder of the Financial Year. Agreement reviewed annually
by the Board of Directors;
1,000,000 options to acquire ordinary shares in the capital of the Company (20 cents, expire 23 June 2013);
1,000,000 options to acquire ordinary shares in the capital of the Company (30 cents, expire 23 June 2013).
Options terminated upon mutual agreement following the Manhattan merger on 20 July 2009;
1,000,000 options to acquire ordinary shares in the capital of the Company (40 cents, expire 23 June 2013).
Options terminated upon mutual agreement following the Manhattan merger on 20 July 09; and
Termination of employment by the Company requires a period of 4 month’s notice, and termination by the
Managing Director requires 1 month’s notice.
(D)
Share Based Compensation
Options
Options over shares in Manhattan are granted as consideration and are approved by general meeting. The Options
are designed to provide long term incentives for executives and non executives to deliver long term shareholder
returns. Participants are granted options which are granted for no issue price and the exercise prices will be such
price as determined by the Board (in its discretion) on or before the date of issue.
Options are granted for no consideration.
The terms and conditions of each grant of options (up to 30 June 2009) affecting remuneration in the previous, this
or future reporting periods are as follows:
Grant Date
Date Vested and
Exercisable
Expiry Date
Exercise Price
Value Per
Option at Grant
Date
Percent Vested
18 December 20061
23 June 2008
23 June 20082
23 June 20082
n/a
23 December 2009
23 June 2010
23 June 2011
30 June 2010
23 June 2013
23 June 2013
23 June 2013
$0.20
$0.20
$0.30
$0.40
Nil
$0.11
$0.10
$0.09
100
-
-
-
1
2
Founder Options are escrowed until 28 January 2010.
Options terminated by mutual agreement on the Manhattan merger on 21 July 2009 and replaced with new options issued.
Options granted carry no dividend or voting rights.
12
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
DIRECTORS’ REPORT
Details of options over ordinary shares in the Company provided as remuneration to each Director of Manhattan
and each of the Key Management Personnel of the Company are set out below. When exercisable, each option is
convertible into one ordinary share of Manhattan.
Further information on the options is set out in note 24 to the Financial Statements.
Options
Number of Options Granted
During Year
Number of Options Vested
During Year
Directors
2009
2008
2009
2008
Marcello Cardaci
David Riekie
Robert Wrixon1
Key Management Personnel
Phil Warren
Total
-
-
-
-
-
-
-
3,000,000
-
3,000,000
-
-
-
-
-
-
-
-
-
-
1
2,000,000 Options terminated upon mutual agreement following the Manhattan merger on 21 July 2009, and replaced with
new options issued.
The assessed fair value at grant date of options granted to the individuals is allocated equally over the period from
grant date to vesting date, and the amount is included in the remuneration tables above. Fair values at grant date
are independently determined using a Black and Scholes option pricing model that takes into account the exercise
price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the
underlying share, the expected dividend yield and the risk free interest rate for the term of the option.
There were no options issued or shares issued on exercise of options during the Financial Year ended 30 June
2009.
(E)
Additional Information
Details of Remuneration: Options
Options are issued to Directors and executives as part of their remuneration. The options are not issued based on
performance criteria, but are issued to the majority of Directors and executives of Manhattan Corporation Limited to
increase goal congruence between executives, Directors and shareholders.
Directors of Manhattan
Year Granted
Vested
Percentage
Forfeited
Percentage
Financial
Years in
Which Options
May Vest
Minimum
Total Value of
Grant Yet to
Vest
Maximum
Total Value of
Grant Yet to
Vest
1
Marcello Cardaci1
David Riekie
Robert Wrixon2
Key Management Personnel
Phil Warren
Sam Middlemas
2006
2006
2008
-
-
100
100
-
-
-
-
-
-
-
-
-
-
2009, 10 & 11
-
-
$
$
-
-
Nil
-
-
-
-
136,540
-
-
1
2
Founder Options are escrowed until 28 January 2010
Options vesting in 2010 and 2011 were terminated upon mutual agreement following the Manhattan merger on 20/7/09, and
replaced with new options issued.
(F)
Loans to Directors and Executives
There were no loans to Directors and Executives during the Financial Year.
This is the end of the Audited Remuneration Report.
13
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
DIRECTORS’ REPORT
DIRECTORS’ INTERESTS
The relevant interest of each Director in the shares or options issued by the Company as notified by the Directors to the
ASX in accordance with S205G(1) of the Corporations Act 2001, at the date of this report is as follows:
Directors
Ordinary Shares
Options Over Ordinary Shares
Alan J Eggers
26,047,939
Robert Wrixon
Marcello Cardaci
120,000
1,565,726
John A G Seton
22,536,300
2,849,379 ($0.20, 21 January 2012)
2,250,000 ($0.60, 21 July 2014)1
2,250,000 ($1.00, 21 July 2014)2
1,000,000 ($0.20, 23 June 2013)3
1,000,000 ($0.60, 21 July 2014)1
1,000,000 ($1.00, 21 July 2014)2
1,250,000 ($0.20, 30 June 2010)4
500,000 ($0.60, 21 July 2014)1
500,000 ($1.00, 21 July 2014)2
2,849,379 ($0.20, 21 January 2012)
500,000 ($0.60, 21 July 2014)1
500,000 ($1.00, 21 July 2014)2
1
2
3
4
Options will only vest on 21 July 2010, providing employment conditions are continuously met during the period.
Options will only vest on 21 July 2011 providing employment conditions are continuously met during the period.
Options will only vest on 23 December 2009 providing employment conditions are continuously met during the period.
1,250,000 shares and 1,250,000 options are escrowed until 28 January 2010.
SHARES UNDER OPTION
Unissued ordinary shares of Manhattan under option at the date of this Report are as follows:
Date Options Granted
Expiry Date
Issue Price of Shares
Number Under Option
18 December 20061
22 January 2008
23 June 20082
21 July 20093
21 July 20094
30 June 2010
22 January 2012
23 June 2013
21 July 2014
21 July 2014
$0.20
$0.20
$0.20
$0.60
$1.00
5,000,000
3,849,379
1,000,000
5,550,000
5,550,000
1
2
3
4
Founder Options are escrowed until 28 January 2010
Options will only vest on 23 December 2009 providing employment conditions are continuously met during the period.
Options will only vest on 21 July 2010, providing employment conditions are continuously met during the period.
Options will only vest on 21 July 2011 providing employment conditions are continuously met during the period.
No option holder has any right under the options to participate in any other share issue of the Company or any other entity.
SHARES ISSUED ON THE EXERCISE OF OPTIONS
There were no options exercised during the Financial Year.
DIRECTORS’ MEETINGS
The number of Directors’ meetings and the number of meetings attended by each of the Directors of the Company for the
time the Director held office during the Financial Year are:
14
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
DIRECTORS’ REPORT
Directors
Director Meetings
Audit Committee
Number of Meetings Held
Number of Meetings Attended
Marcello Cardaci
Robert Wrixon
David Riekie
7
7
7
6
2
2
2
2
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on
behalf of the Company, or to intervene in any proceedings to which the Company is a party, for the purpose of taking
responsibility on behalf of the Company for all or part of those proceedings.
No proceedings have been brought or intervened in on behalf of the Company with leave of the Court under section 237 of
the Corporations Act 2001.
NON AUDIT SERVICES
The Company may decide to employ the Auditor on assignments additional to their statutory audit duties where the
Auditor’s expertise and experience with the Company is important. The Board has considered the position and is satisfied
that the provision of non audit services is compatible with the general standard of independence for auditors imposed by
the Corporations Act 2001, and would not compromise the Auditor’s independence.
During the year the following fees were paid or payable for services provided by the Auditor of the Company, its related
practices and non related audit firms:
Audit Services
2009
2008
BDO Kendalls Audit and Assurance (WA) Pty Ltd
Audit and Review of Financial Reports
Tax Work under the Corporations Act 2001
Total Remuneration for Audit Services
$
42,688
8,700
51,388
$
21,688
-
21,688
DIRECTORS’ AND OFFICERS INSURANCE
During the Financial Year, Manhattan paid a premium to insure the Directors and the Company Secretary.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings that may be brought
against the officers in their capacity as officers of the Company, and any other payments arising from liabilities incurred by
the officers in connection with such proceedings. This does not include such liabilities that arise from conduct involving a
wilful breach of duty by the officers or the improper use by the officers of their position or of information to gain advantage
for themselves or someone else or to cause detriment to the Company. It is not possible to apportion the premium
between amounts relating to the insurance against legal costs and those relating to other liabilities.
AUDITORS’ INDEPENDENCE DECLARATION
A copy of the Auditors’ Independence Declaration as required under section 307C of the Corporations Act 2001 is set out
on page 18 of the Annual Report.
BDO Kendalls Audit and Assurance (WA) Pty Ltd is appointed to office in accordance with section 327 of the Corporations
Act 2001.
Signed in accordance with a Resolution of the Directors.
DATED at Perth on 25 September 2009
ALAN J EGGERS
Executive Chairman
15
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
AUDITOR’S REPORT
________________________________________________________________________________
BDO(cid:3)Kendalls(cid:3)Audit(cid:3)&(cid:3)Assurance(cid:3)(WA)(cid:3)Pty(cid:3)Ltd(cid:3)
128(cid:3)Hay(cid:3)Street(cid:3)
SUBIACO(cid:3)(cid:3)WA(cid:3)(cid:3)6008(cid:3)
PO(cid:3)Box(cid:3)700(cid:3)
WEST(cid:3)PERTH(cid:3)(cid:3)WA(cid:3)(cid:3)6872(cid:3)
Phone(cid:3)61(cid:3)8(cid:3)9380(cid:3)8400(cid:3)
Fax(cid:3)61(cid:3)8(cid:3)9380(cid:3)8499(cid:3)
aa.perth@bdo.com.au(cid:3)
www.bdo.com.au(cid:3)
(cid:3)
ABN(cid:3)79(cid:3)112(cid:3)284(cid:3)787(cid:3)
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF MANHATTAN CORPORATION LIMITED
We have audited the accompanying financial report of Manhattan Corporation Limited, which comprises the balance sheet
as at 30 June 2009, and the income statement, statement of recognised income and expenses and cash flow statement for
the year ended on that date, a summary of significant accounting policies, other explanatory notes and the directors’
declaration.
Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation and fair presentation of the financial report in accordance
with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Act 2001.
This responsibility includes establishing and maintaining internal controls relevant to the preparation and fair presentation
of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying
appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. In Note 1, the
directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that
compliance with the Australian equivalents to International Financial Reporting Standards ensures that the financial report,
comprising the financial statements and notes, complies with International Financial Reporting Standards.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in
accordance with Australian Auditing Standards. These Auditing Standards require that we comply with relevant ethical
requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the
financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report.
The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material
misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers
internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the
reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the
financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001. We confirm
that the independence declaration required by the Corporations Act 2001 would be in the same terms if it had been given
to the directors at the time that this auditor’s report was made.
BDO Kendalls is a national association of
separate partnerships and entities. Liability
limited by a scheme approved under
Professional Standards Legislation.
16
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
AUDITOR’S REPORT
Auditor’s Opinion
In our opinion:
(a)
the financial report of Manhattan Corporation Limited is in accordance with the Corporations Act 2001, including:
(i)
(ii)
giving a true and fair view of the company’s financial position as at 30 June 2009 and of its performance for
the year ended on that date; and
complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and
the Corporations Regulations 2001; and
(b)
the financial report also complies with International Financial Reporting Standards as disclosed in Note 1.
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June 2009. The directors
of the company are responsible for the preparation and presentation of the Remuneration Report in accordance with
section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based
on our audit conducted in accordance with Australian Auditing Standards.
Auditor’s Opinion
In our opinion, the Remuneration Report of Manhattan Corporation Limited for the year ended 30 June 2009, complies with
section 300A of the Corporations Act 2001.
BDO Kendalls Audit & Assurance (WA) Pty Ltd
Peter Toll
Director
Perth, Western Australia
Dated this 25th day of September 2009
17
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
AUDITOR’S DECLARATION
BDO(cid:3)Kendalls(cid:3)Audit(cid:3)&(cid:3)Assurance(cid:3)(WA)(cid:3)Pty(cid:3)Ltd(cid:3)
128(cid:3)Hay(cid:3)Street(cid:3)
SUBIACO(cid:3)(cid:3)WA(cid:3)(cid:3)6008(cid:3)
PO(cid:3)Box(cid:3)700(cid:3)
WEST(cid:3)PERTH(cid:3)(cid:3)WA(cid:3)(cid:3)6872(cid:3)
Phone(cid:3)61(cid:3)8(cid:3)9380(cid:3)8400(cid:3)
Fax(cid:3)61(cid:3)8(cid:3)9380(cid:3)8499(cid:3)
aa.perth@bdo.com.au(cid:3)
www.bdo.com.au(cid:3)
(cid:3)
ABN(cid:3)79(cid:3)112(cid:3)284(cid:3)787(cid:3)
25th September 2009
The Directors
Manhattan Corporation Limited
15 Rheola St
West Perth WA 6005
Dear Sirs
DECLARATION OF
MANHATTAN CORPORATION LIMITED
INDEPENDENCE BY PETER TOLL TO THE DIRECTORS OF
As lead auditor of Manhattan Corporation Limited for the year ended 30 June 2009, I declare
that, to the best of my knowledge and belief, there have been no contraventions of:
(cid:120)
(cid:120)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit;
and
any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Manhattan Corporation Limited and the entities it controlled
during the period.
Peter Toll
Director
BDO Kendalls is a national association of
separate partnerships and entities. Liability
limited by a scheme approved under
Professional Standards Legislation.
18
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
FINANCIAL STATEMENTS
________________________________________________________________________________
For the Year Ended 30 June 2009
INCOME STATEMENT
REVENUE
Revenue from Continuing Operations
EXPENSES
Expenses Excluding Finance Costs
Finance Costs
Loss Before Income Tax
Income Tax Expense
Loss For The Year
Note
2009
2008
5
6
6
8
$
214,700
$
156,327
(3,389,099)
(47,493)
(489,464)
(41,196)
(3,221,892)
(374,333)
(1,348)
-
(3,223,240)
(374,333)
Loss Attributable to Members of Manhattan Limited
(3,223,240)
(374,333)
Basic Earnings/(Loss) Per Share
Where diluted earnings per share are not dilutive, they
are not disclosed
7
(8.2) cents
(1.6) cents
The Income Statement should be read in conjunction with the accompanying Notes that form part of these Financial
Statements.
19
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
FINANCIAL STATEMENTS
As at 30 June 2009
BALANCE SHEET
ASSETS
Current Assets
Cash and Cash Equivalents
Trade and Other Receivables
Total Current Assets
Non Current Assets
Property, Plant and Equipment
Exploration and Evaluation Expenditure
Total Non Current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Trade and Other Payables
Borrowings
Total Current Liabilities
Non Current Liabilities
Borrowings
Total Non Current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed Capital
Reserves
Accumulated Losses
TOTAL EQUITY
Note
2009
2008
$
$
10
11
13
12
14
15
15
16
17
981,885
82,445
1,064,330
1,855
2,172,505
2,174,360
3,554,602
60,282
3,614,884
2,913
3,994,105
3,997,018
3,238,690
7,611,902
116,293
-
116,293
-
-
427,845
250,000
677,845
750,000
750,000
116,293
1,427,845
3,122,397
6,184,057
6,075,793
645,504
(3,598,900)
6,075,793
483,924
(375,660)
3,122,397
6,184,057
The Balance Sheet should be read in conjunction with the accompanying Notes that form part of these Financial
Statements.
20
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
FINANCIAL STATEMENTS
________________________________________________________________________________
For the Year Ended 30 June 2009
STATEMENT OF CASH FLOWS
Note
2009
2008
Cash Flows From Operating Activities
Payments to Suppliers and Employees (inclusive of GST)
Interest Received
Other Revenue
Income tax Paid
Net Cash Flows From/(Used In) Operating Activities
23
Cash Flows From Investing Activities
Payments for Property, Plant and Equipment
Funds Received From Applications Withdrawn
Payments For Exploration and Evaluation
Net Cash Flows Used In Investing Activities
Cash Flows From Financing Activities
Proceeds From Issue of Shares
Payment of Share Issue and IPO Costs
Loan Repayments
Net Cash Flows From/(Used In) Financing Activities
Net (Decrease)/Increase In Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Period
Cash and Cash Equivalents at End of Period
Non Cash Financing and Investing Activities
10
19
$
(1,414,245)
121,696
-
(1,348)
(1,293,897)
-
136,744
(665,564)
(528,820)
-
-
(750,000)
(750,000)
(2,572,717)
3,554,602
981,885
$
(405,958)
156,327
228,229
-
(21,402)
(3,177)
-
(1,249,477)
(1,252,654)
4,586,500
(449,590)
-
4,136,910
2,862,854
691,748
3,554,602
The Statement of Cash Flows should be read in conjunction with the accompanying Notes that form part of these Financial
Statements.
21
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
FINANCIAL STATEMENTS
________________________________________________________________________________
STATEMENT OF RECOGNISED INCOME AND EXPENSE
For the Year Ended 30 June 2009
Total Equity at the Beginning of the Financial Year
Net Income Recognised Directly in Equity Loss for the Year
Total Recognised Income and Expense for the Year
Note
2009
2008
$
$
6,184,057
1,168,178
(3,223,240)
(3,223,240)
(374,333)
(374,333)
Transactions With Equity Holders in Their Capacity as Equity Holders
Contributions of Equity Net of Transaction Costs
Share Based Payments Reserve
16
17
-
161,580
4,906,287
483,925
Total Equity at the End of the Financial Year
3,122,397
6,184,057
The Statement of Recognised Income and Expense should be read in conjunction with the accompanying Notes that form
part of these Financial Statements.
22
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies adopted in the preparation of the financial report are set out below. These policies
been consistently applied to all the years presented, unless otherwise stated.
(a)
Basis of Preparation
This general purpose financial report has been prepared in accordance with Australian Accounting
Standards, other authoritative pronouncements of the Australian Accounting Standards Board, Australian
Accounting Interpretations and the Corporations Act 2001.
Compliance with IFRS
The financial report of Manhattan Corporation Limited also complies with International Financial Reporting
Standards (“IFRS”) as issued by the International Accounting Standards Board.
Historical Cost Convention
These Financial Statements have been prepared under the historical cost convention.
Critical Accounting Estimates
The preparation of financial statements in conformity with AIFRS requires the use of certain critical
accounting estimates. It also requires management to exercise its judgement in the process of applying the
Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas
where assumptions and estimates are significant to the Financial Statements are disclosed in note 2.
Going Concern
The Company incurred a loss for the year of $3,223,240 (2008: $374,333) and a net cash outflow from
operating activities of $1,293,897 (2008: $21,402).
At 30 June 2009 the Company had cash assets of $981,885 (2008: $3,554,602) and working capital of
$948,038 (2008: $2,937,039).
Since the end of the Financial Year, the Company has completed the merger with Manhattan Resources Pty
Ltd, which at the time of the merger had net cash and liquid assets in excess of $8 million. Based on this
fact, the Directors consider it appropriate that the finance report be prepared on a going concern basis.
(b)
Segment Reporting
A business segment is identified for a group of assets and operations engaged in providing products or
services that are subject to risks and returns that are different to those of other business segments. A
geographical segment is identified when products or services are provided within a particular economic
environment subject to risks and returns that are different from those of segments operating in other
economic environments.
(c)
Revenue Recognition
Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as
revenue are net of returns, trade allowances, rebates and amounts collected on behalf of third parties.
The Company recognises revenue when the amount of revenue can be reliably measured, it is probable that
future economic benefits will flow to the entity and specific criteria have been met for each of the Company’s
activities as described below. The amount of revenue is not considered to be reliably measurable until all
contingencies relating to the sale have been resolved. The Company bases its estimates on historical
results, taking into consideration the type of customer, the type of transaction and the specifics of each
arrangement.
(d)
Income Tax
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income
based on the national income tax rate for each jurisdiction adjusted by changes in deferred tax assets and
liabilities attributable to temporary differences and to unused tax losses.
23
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Deferred income tax is provided in full, using the liability method, on temporary differences arising between
the tax bases of assets and liabilities and their carrying amounts in the Consolidated Financial Statements.
However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or
liability in a transaction other than a business combination that at the time of the transaction affects neither
accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have
been enacted or substantially enacted by the Balance Sheet date and are expected to apply when the
related deferred income tax asset is realised or the deferred income tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount
and tax bases of investments in controlled entities where the parent entity is able to control the timing of the
reversal of the temporary differences and it is probable that the differences will not reverse in the
foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax
assets and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax
assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either
to settle on a net basis, or to realise the asset and settle the liability simultaneously. Current and deferred tax
balances attributable to amounts recognised directly in equity are also recognised directly in equity.
(e)
Impairment of Assets
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are
separately identifiable cash inflows which are largely independent of the cash inflows from other assets or
company of assets (cash generating units). Non financial assets other than goodwill that suffered impairment
are reviewed for possible reversal of the impairment at each reporting date.
(f)
Acquisition of Assets
Assets including exploration interests acquired are initially recorded at their cost of acquisition on the date of
acquisition, being the fair value of the consideration provided plus incidental costs directly attributable to the
acquisition.
When equity instruments are issued as consideration, their market price at the end of acquisition is used as
fair value, except where the notional price at which they could be placed in the market is a better indication
of fair value.
(g)
Cash and Cash Equivalents
For cash flow statement presentation purposes, cash and cash equivalents includes cash on hand, deposits
held at call with financial institutions, other short term, highly liquid investments with original maturities of
three months or less that are readily convertible to known amounts of cash and which are subject to an
insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in
current liabilities on the Balance Sheet.
(h)
Exploration and Evaluation Expenditure
Exploration, evaluation and development expenditure incurred is accumulated in respect of each identifiable
area of interest. These costs are only carried forward to the extent that they are expected to be recouped
through the successful development of the area or where activities in the area have not yet reached a stage
that permits reasonable assessment of the existence of economically recoverable reserves.
Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which
the decision to abandon the area is made.
When production commences, the accumulated costs for the relevant area of interest are amortised over the
life of the area according to the rate of depletion of the economically recoverable reserves.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to
carry forward costs in relation to that area of interest.
24
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(i)
Trade and Other Payables
These amounts represent liabilities for goods and services provided to the Company prior to the end of
Financial Year which are unpaid. The amounts are unsecured and are usually paid within 30 days of
recognition.
(j)
Contributed Equity
Ordinary shares are classified as equity. Mandatory redeemable preference shares are classified as
liabilities. Incremental costs directly attributable to the issue of new shares or options are shown in equity as
a deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares
or options for the acquisition of a business are not included in the cost of the acquisition as part of the
purchase consideration.
If the entity reacquires its own equity instruments, e.g. as the result of a share buy back, those instruments
are deducted from equity and the associated shares are cancelled. No gain or loss is recognised in the profit
or loss and the consideration paid including any directly attributable incremental costs (net of income taxes)
is recognised directly in equity.
(k)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST
incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of
acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount
of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables
in the Balance Sheet.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or
financing activities which are recoverable from, or payable to the taxation authority, are presented as
operating cash flow.
(l)
Employee Benefit Provisions
Wages and Salaries, Annual Leave and Sick Leave
Liabilities for wages and salaries, including non monetary benefits, annual leave and accumulating sick
leave expected to be settled within 12 months of Balance Sheet date are recognised in respect of
employees' services rendered up to Balance Sheet date and measured at amounts expected to be paid
when the liabilities are settled. Liabilities for non accumulating sick leave are recognised when leave is taken
and measured at the actual rates paid or payable. Liabilities for wages and salaries, and annual leave are
included as part of Other Payables.
Long Service Leave
Liabilities for long service leave are recognised as part of the provision for employee benefits and measured
as the present value of expected future payments to be made in respect of services provided by employees
to the Balance Sheet date using the projected unit credit method. Consideration is given to expected future
salaries and wages levels, experience of employee departures and periods of service. Expected future
payments are discounted using national government bond rates at Balance Sheet date with terms to
maturity and currency that match, as closely as possible, the estimated future cash outflows.
Share Based Payments
The Company provides benefits to employees (including Directors) in the form of share based payment
transactions, whereby employees render services in exchange for shares or options over shares ("equity
settled transactions"). There are currently no plans in place.
25
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Share Based Payments
The Company provides benefits to employees (including Directors) in the form of share based payment
transactions, whereby employees render services in exchange for shares or options over shares ("equity
settled transactions"). There are currently no plans in place.
The fair value of options granted is recognised as an employee benefit expense with a corresponding
increase in equity (share option reserve). The fair value is measured at grant date and recognised over the
period during which the employees become unconditionally entitled to the options. Fair value is determined
by an independent valuator using a Black and Scholes option pricing model. In determining fair value, no
account is taken of any performance conditions other than those related to the share price of Manhattan
("Market Conditions").
The cumulative expense recognised between grant date and vesting date is adjusted to reflect the Director’s
best estimate of the number of options that will ultimately vest because of internal conditions of the options,
such as the employees having to remain with the Company until vesting date, or such that employees are
required to meet internal sales targets.
(m) Earnings Per Share
Basic Earnings Per Share
Basic earnings per share is calculated by dividing profit/(loss) attributable to equity holders of the Company,
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of
ordinary shares outstanding during the Financial Year, adjusted for bonus elements in ordinary shares
issued during the year.
Diluted Earnings Per Share
Diluted earnings per share adjust the figures used in the determination of basic earnings per share to take
into account the after income tax effect of interest and other financing costs associated with dilutive potential
ordinary shares and the weighted average number of additional ordinary shares that would have been
outstanding assuming the conversions of all dilutive potential ordinary shares.
(n)
New Accounting Standards and Interpretations
Certain new accounting standards and interpretations have been published that are not mandatory for 30
June 2009 reporting periods. The Company has assessed the impact of these new standards and
interpretations not to be material to the Company’s accounts.
(o)
Dividends
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at
the discretion of the entity, on or before the end of the Financial Year but not distributed at balance date.
2.
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
Estimates and judgements are continually evaluated and are based on historical experience and other factors,
including expectations of future events that may have a financial impact on the entity and that are believed to be
reasonable under the circumstances.
Key Estimates: Impairment of Exploration and Exploration Expenditure
The Company assesses impairment at each reporting date by evaluating conditions specific to the Company that
may lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is
determined by Value in use calculations performed in assessing recoverable amounts and incorporate a number of
key estimates. The Company has made an impairment charge for the year which has been recognised in the
Income Statement.
26
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
2.
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued)
Share Based Payment Transactions
The Company measures the cost of equity settled share based payments at fair value at the grant date using the
Black and Scholes model taking into account the exercise price, the term of the option, the impact of dilution, the
share price at the grant date, the expected volatility of the underlying share, the expected dividend yield and risk
free interest rate for the term of the option.
3.
SEGMENT INFORMATION
The Company operates in one industry, mineral resource exploration and assessment of mineral projects and in
one main geographical segment, being Australia.
4.
FINANCIAL RISK MANAGEMENT
The Company’s activities expose it to a variety of financial risks: market risk (including currency risk, interest rate
risk and price risk), credit risk and liquidity risk. The Company’s overall risk management program focuses on the
unpredictability of the financial markets and seeks to minimise potential adverse effects on the financial
performance of the Company. The Company does not use derivative financial instruments, however the Company
uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity
analysis in the case of interest rate and other price risks, aging analysis for credit risk and at present are not
exposed to price risk.
Risk management is carried out by the Board of Directors with assistance from suitably qualified external and
internal advisors. The Board provides written principles for overall risk management and further policies will evolve
commensurate with the evolution and growth of the Company.
(a) Market Risk
(i)
Foreign Exchange Risk
The Company does not currently operate internationally and therefore its exposure to foreign
exchange risk arising from currency exposures is limited.
(ii)
Price Risk
The Company is not exposed to equity securities price risk and holds no equity investments. The
Company is not exposed to commodity price risk as the Company is still carrying out exploration.
(iii) Cash Flow and Fair Value Interest Rate Risk
The Company’s only interest rate risk arises from cash and cash equivalents and borrowings. Term
deposits and current accounts held with variable interest rates expose the Company to cash flow
interest rate risk. The Company does not consider this to be material to the Company and have
therefore not undertaken any further analysis of risk exposure.
(b)
Credit Risk
Credit risk is managed by the Board for the Company. Credit risk arises from cash and cash equivalents as
well as credit exposure including outstanding receivables and committed transactions. All cash balances
held at banks are held at internationally recognised institutions, with minimum independently rated rates of
‘A’. The majority of receivables are immaterial to the Company. Given this the credit quality of financial
assets that are neither past due or impaired can be assessed by reference to historical information about
default rates.
The maximum exposure to credit risk is the carrying amount of the financial assets of cash and trade and
other receivables to the value of $1,064,330 (2008: $3,614,884).
The following financial assets of the Company are neither past due or impaired:
27
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
4.
FINANCIAL RISK MANAGEMENT (continued)
Financial Assets
2009
2008
$
981,885
82,445
1,064,330
$
3,554,602
60,282
3,614,884
Cash and Cash Equivalents
Trade and Other Receivables
Total
(c)
Liquidity Risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the
availability of funding through an adequate amount of committed credit facilities and the ability to close out
market positions. The Company manages liquidity risk by continuously monitoring forecast and actual cash
flows and matching the maturity profits of financial assets and liabilities. As at reporting date the Company
had sufficient cash reserves to meet its requirements. The Company therefore had no credit standby
facilities or arrangements for further funding in place.
The financial liabilities of the Company at reporting date were trade payables incurred in the normal course
of the business. These were non interest bearing and were due within the normal 30 to 60 days terms of
creditor payments. The Company repaid all borrowings during the year (2008; $1,000,000) and have
therefore not undertaken any further analysis of risk exposure.
As At 30 June 2009
Less Than 6
Months
6 to 12
Months
Between 1
and 2 Years
Between 2
and 5 Years
Over 5 Years
Total
Contractual
Cash Flows
Carrying
Amounts
(Assets /
Liabilities)
Non Derivatives
Non Interest Bearing
$
116,293
$
-
$
-
$
-
$
$
$
-
116,293
116,293
(d)
Fair Value Estimation
The fair value of financial assets and liabilities must be estimated for recognition and measurement or for
disclosure purposes.
The fair value of financial instruments traded in active markets is based on current quoted market prices at
reporting date. The quoted market price used for financial assets held by the Company is the current market
price.
The carrying value less any required impairment provision of trade receivables and payables are assumed to
approximate their fair values due to their short term nature.
5.
REVENUES
Revenues
2009
2008
Other Revenue From Continuing Operations
Interest
Other: Profit From Sale of Tenements
Total
$
121,696
93,004
214,700
$
156,327
-
156,327
28
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
6.
EXPENSES
(a)
Expenses, Excluding Finance Costs, Included in the Income Statement
Expenses
2009
2008
Legal Fees
Depreciation
ASX and Share Registry Fees
Consultant Fees
Rent
Employee Benefits
Exploration Impairment
Share Based payments
General and Administration Costs
Total Expenses, Excluding Finance Costs
(b)
Finance Costs
$
2,005
1,058
26,824
93,390
135,279
504,154
2,115,501
161,580
349,308
3,389,099
$
41,019
264
18,766
67,000
30,482
208,178
-
18,150
105,605
489,464
Finance Costs
2009
2008
$
2,647
44,846
47,493
$
804
40,392
41,196
Bank Fees and Charges
Interest Expense
Total Finance Costs
7.
EARNINGS (LOSS) PER SHARE
Basic earnings (loss) per share (“EPS”) amounts are calculated by dividing net loss for the year attributable to
ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the
period.
Diluted earnings (loss) per share amounts are calculated by dividing the net loss attributable to ordinary
shareholders by the weighted average number of ordinary shares outstanding during the period (adjusted for the
effects of dilutive options).
The following reflects the income and share data used in the total operations basic and diluted earnings (loss) per
share computations:
Earnings (Loss) Per Share
2009
2008
Basic Loss Per Share
Loss Used in Calculating EPS
Weighted Average Number of Ordinary Shares
Outstanding During the Year Used in Calculating Basic EPS
$
(0.082)
(3,223,240)
$
(0.016)
(374,333)
Number
39,279,379
Number
23,505,224
Diluted EPS is not disclosed as potential ordinary shares are not dilutive as their potential conversion to fully paid
shares would not increase the loss per share.
(a)
Capital Allotment Subsequent To Year End
Refer to Note 21 for details of the capital raising post 30 June 2009.
29
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
8.
INCOME TAX EXPENSE
(a)
Income Tax Expense
Income Tax Expense
2009
2008
Current Tax
Deferred tax
Under (Over) Provided in Prior Years
Total Income Tax Expense
(b)
Deferred Income Tax Expense Comprises
$
$
-
-
(1,348)
(1,348)
Deferred Income Tax Expense
2009
2008
(Decrease)/Increase in Deferred Tax Asset
(Decrease)/Increase in Deferred Tax Liability
Total Deferred Income Tax Expense
$
$
-
-
-
No deferred tax has been recognised in either the Income Statement or directly in equity.
(c)
Reconciliation of Income Tax Expense to Prima Facie Tax Payable
Reconciation of Income Tax
2009
2008
-
-
-
-
-
-
-
Loss From Continuing Operations Before Income Tax
Tax at the Australian rate of 30%
Tax Effect of Permanent Differences:
Legal Fees
Entertainment
Share Based Payments Expense
Benefits of Tax Losses Not Brought to Account
Under/(Over) Provision From Prior Years
Total Tax Payable
$
(3,221,892)
(966,568)
-
240
48,474
917,854
(1,348)
964,980
$
(374,333)
(112,300)
5,272
628
5,445
100,955
-
-
(d)
Tax Losses and Other Timing Differences for Which No Deferred Tax Asset has been Recognised
Tax Losses Recognised
2009
2008
Unused Tax Losses with no Deferred Tax Asset Recognised
Capital Raising Fees
Accrued Superannuation/Provision for Annual Leave
Total Tax Losses
$
1,575,178
84,645
820
1,660,643
$
125,314
113,480
4,477
243,271
The Company has tax losses arising in Australia of $5,649,859 ($1,694,961 at 30% tax rate) (2008:
$129,652) of which no deferred tax asset has been recognised that are available indefinitely for offset
against future taxable profits of the Company.
30
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
9.
DIVIDENDS PAID OR PROPOSED
There were no dividends paid or proposed during the year.
10.
CASH AND CASH EQUIVALENTS
Cash and Cash Equivalents
2009
2008
Cash at Bank and In Hand
Deposits at Call
Total Cash and Cash Equivalents
$
6,191
975,694
981,885
$
255,100
3,299,502
3,556,610
Cash at bank and in hand earns interest at floating interest rates based on the daily bank rates.
(a)
Interest Rate Exposure
The Company’s exposure to interest rate risk is discussed in note 4.
(b)
Reconciliation to Cash at the End of the Year
The above figures represent the cash at the end of the Financial Year as shown in the Statement of Cash
Flows.
11.
TRADE AND OTHER RECEIVABLES (CURRENT)
Trade and Other Receivables
2009
2008
GST Receivable
Other Debtors
Total Trade and Other Receivables
(a)
Fair Values and Credit Risk
$
32,774
49,671
82,445
$
49,629
10,653
62,290
Due to the short term nature of these receivables the carrying values represent their respective fair values at
30 June 2009.
The maximum exposure to credit risk at the reporting date is the carrying amount of each class of
receivables mentioned above. Refer to note 4 for more information on the risk management policy of the
Company and the credit quality of the entity’s receivables.
(b)
Other Receivables
These amounts generally arise from transactions outside the usual operating activities of the Company.
Collateral is not normally obtained.
12.
EXPLORATION AND EVALUATION EXPENDITURE (NON CURRENT)
Recoverability of the carrying amount of exploration assets is dependent upon successful exploration and
development or sale of mineral deposits of the respective areas of interest. Carrying values were assessed in light
of exploration and current market conditions, and an impairment provision has been raised based on this review.
31
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
12.
EXPLORATION AND EVALUATION EXPENDITURE (NON CURRENT) (continued)
Exploration and Evaluation Expenditure
2009
2008
As at 1 July
Capitalised During the Year
Tenement Applications Withdrawn
Tenements Acquired from Deep Yellow Ltd
Tenements Returned to Deep Yellow Ltd
Impairment of Exploration Expenditure
As at 30 June
$
3,994,105
459,965
(159,068)
150,000
(156,996)
(2,115,501)
2,172,505
$
500,000
258,455
-
3,235,650
-
-
3,994,105
13.
PROPERTY, PLANT AND EQUIPMENT (NON CURRENT)
Property, Plant and Equipment
2009
2008
Computer Equipment and Software
Cost or Fair Value
Accumulated Depreciation
Net Book Amount
Opening Net Book Amount
Additions
Depreciation Charge for the Year
Closing Net Book Amount
14.
TRADE AND OTHER PAYABLES (CURRENT)
$
3,177
(1,322)
1,855
2,913
(1,058)
1,855
$
3,177
(264)
2,913
3,177
-
(264)
2,913
Trade and Other Payables
2009
2008
Trade Payables
Other Creditors
Total Trade and Other Payables
$
61,860
54,433
116,293
$
44,481
383,364
427,845
Trade payables and other creditors are non interest bearing and will be settled on 30 to 60 day terms.
15.
BORROWINGS
Borrowings
2009
2008
Unsecured Current
Borrowings
Total Current Borrowings
Unsecured Non Current
Borrowings
Total Non Current Borrowings
(a)
Risk Exposure
$
-
-
-
-
$
250,000
250,000
750,000
750,000
Details of the Company’s exposure to risks arising from borrowings are set out in note 4.
32
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
16.
ISSUED CAPITAL
Issued Capital
Note
2009
2008
2009
2008
Ordinary Shares
Issued and Fully paid
Total Contributed Equity
(a)
Shares
39,279,379
39,279,379
Shares
39,279,379
39,279,379
$
6,075,793
6,075,793
$
6,075,793
6,075,793
(a)
Movements in Ordinary Share Capital
Date
Details
1 July 2007
21 January 2008
21 January 2008
Opening Balance
Initial Public Offering
Issue to Deep Yellow Ltd
Less Transaction Cost on Share Issue
30 June 2008
Balance
30 June 2009
Balance
(b)
Ordinary Shares
Number of
Shares
12,500,000
22,930,000
3,849,379
39,279,379
39,279,379
Issue Price
$
$0.20
$0.20
1,169,506
4,586,000
769,876
(449,589)
6,075,793
6,075,793
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the
Company in proportion to the number of and amounts paid on the shares held. On a show of hands every
holder of ordinary shares present at a meeting in person, or by proxy, is entitled to one vote, and upon a poll
each share is entitled to one vote. There is no authorised or par value share as prescribed in the Company’s
constitution.
(c)
Capital Risk Management
The Company’s objectives when managing capital are to safeguard their ability to continue as a going
concern, so that they can continue to provide returns to shareholders and benefits for other stakeholders
and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to
shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
Capital Risk Management
Note
2009
2008
Total Borrowings
Less Cash and Cash Equivalents
15
10
Net Cash
Total Equity
Total Capital
$
-
981,885
981,885
$
(1,000,000)
3,554,602
2,554,602
3,122,397
4,104,282
6,184,057
8,738,659
33
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
17.
RESERVES
Share Based Payment Reserve
2009
2008
Total Borrowings
Less Cash and Cash Equivalents
Total Equity
Total Capital
Nature and Purpose of Reserves
$
483,924
-
161,580
645,504
$
-
465,774
18,150
483,924
The share based payment reserve is used to recognise the fair value of options issued to brokers in consideration
for assistance with the IPO and are included in share issue costs, or options issued to Directors, consultants and
employees.
18.
KEY MANAGEMENT PERSONNEL DISCLOSURES
(a)
Directors
The following persons were Directors of Manhattan during the Financial Year:
Name
Mr Marcello Cardaci
Dr Robert Wrixon
Mr David Riekie
Position
Chairman (Non Executive)
Managing Director
Director (Non Executive)
(b)
Key Management Personnel
The following persons were Key Management Personnel of Manhattan during the Financial Year:
Name
Mr Phil Warren
Mr Sam Middlemas
Position
Company Secretary (resigned 3 March 2009)
Company Secretary (appointed 3 March 2009)
(c)
Key Management Personnel Compensation
Key Management Personnel Compensation
2009
2008
Short Term Employee Benefits
Post Employment Benefits
Share Based Payments
Total Compensation
$
410,057
28,500
161,580
600,137
$
165,810
14,923
18,150
198,883
(d)
Remuneration of Directors and Key Management Personnel
(i)
Remuneration of Directors and Key Management Personnel
Options provided as remuneration and shares issued on the exercise of such options, together with
the terms and conditions of the options, can be found in Section D of the Remuneration Report.
(ii)
Option Holdings
The number of options over ordinary shares in the Company held during the Financial Year by each
Director of Manhattan and Key Management Personnel, including their personally related parties, are
set out below:
34
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
18.
KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)
Option Holdings
Balance at Start
of Year
Granted as
Compensation
Exercised
Other Changes
Balance at End
of year
Vested and
Exercisable
Escrowed or
Unvested
Directors
Marcello Cardaci1
Robert Wrixon
David Riekie2
Key Management Personnel
Phil Warren3
Sam Middlemas
3
Total
1
Directors
Marcello Cardaci
Robert Wrixon4
David Riekie5
Key Management Personnel
Phil Warren6
1,250,000
3,000,000
2,500,000
-
-
6,750,000
1,250,000
-
-
-
-
-
-
-
-
3,000,000
2,500,000
-
-
-
Total
3,750,000
3,000,000
2009
2008
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,250,000
3,000,000
2,500,000
-
-
6,750,000
1,250,000
3,000,000
2,500,000
-
6,750,000
-
-
-
-
-
-
-
-
-
-
-
1,250,000
3,000,000
2,500,000
-
-
6,750,000
1,250,000
3,000,000
2,500,000
-
6,750,000
1
2
3
4
5
6
The options are held by Mr Marcello Cardaci as trustee for the MD Cardaci Family Trust.
The options are held by Grange Consulting Group Pty Ltd of which Mr Riekie was previously a director.
Mr Warren resigned as Company Secretary on 3 March 2009, and was replaced by Mr Middlemas on that date.
Dr Wrixon was appointed as Managing Director on 14 April 2008.
The options are held by Grange Consulting Group Pty Ltd of which Mr Riekie is a director as at 30 June 2008.
Mr Warren resigned as Executive Director on the 22 April 2008 and continued in capacity as Company Secretary.
(iii)
Share Holdings
The numbers of shares in the Company held during the Financial Year by each Director of Manhattan
Limited and Key Management Personnel of the Company, including their personally related parties
are set out below. There were no shares granted during the reporting period as compensation.
Directors and Officers Share
Holdings
Balance at the
Start of the Year
Received During
the Year on the
Exercise
2009
Other Changes
Balance at the End
of the Year
Directors
Marcello Cardaci1
Robert Wrixon
David Riekie2
Key Management Personnel
Phil Warren3
Sam Middlemas4
Total
Directors
Marcello Cardaci1
Robert Wrixon
David Riekie2
Key Management Personnel
Phil Warren3
Total
1,250,000
50,000
2,537,500
62,500
245,000
4,145,000
1,250,000
-
2,537,500
62,500
3,850,000
2008
-
-
-
-
-
-
-
-
-
-
-
-
70,000
-
-
-
70,000
-
50,000
-
-
50,000
1,250,000
120,000
2,537,500
62,500
245,000
4,215,000
1,250,000
50,000
2,537,500
62,500
3,900,000
1
2
3
4
The shares are held by Mr Marcello Cardaci as trustee for the MD Cardaci Family Trust.
2,500,000 Shares are held by Grange Consulting Pty Ltd of which Mr Riekie was a Director and shareholder. 12,500
Shares are held by the Wilhaja Pty Ltd of which Mr Riekie is a beneficiary. 12,500 Shares are held by Mr David Noel
Riekie. 12,500 Shares are held by Mr David Noel Riekie and Mrs Michelle Riekie as trustee for the Riekie
Superannuation Fund of which Mr Riekie is a beneficiary.
37,500 Shares are held by Mr Philip Michael Warren. 25,000 Shares are held by Concept Biotech Pty Ltd, a related
entity to Mr Warren.
Shares held by Ms J A Wolseley an associated party.
35
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
18.
KEY MANAGEMENT PERSONNEL DISCLOSURES (continued)
(e)
Loans to Key Management Personnel
There were no loans made or outstanding to Directors of Manhattan and Key Management Personnel of the
Company, including their personally related parties.
(f)
Other Transactions with Key Management Personnel
(i)
Marcello Cardaci
Mr Marcello Cardaci, is a partner in the firm of Blakiston & Crabb, Lawyers. Blakiston & Crabb
Lawyers has provided legal services of $100,815 (2008: $51,461) to Manhattan during the year on
normal commercial terms.
(ii)
David Riekie
Mr David Riekie was a Director in the firm of Grange Consulting Pty Ltd, Corporate Advisors until his
resignation on 3 August 2008. Grange Consulting provided corporate advisory services of $66,150
(2008; $101,713) to Manhattan during the year on normal commercial terms and conditions.
Aggregate amounts of each of the above types of other transactions with Key Management Personnel:
Amounts Recognised as Expense
2009
2008
Legal Fees (Listing Costs)
Legal Fees (Other)
Corporate Advisory Fees (Listing Costs)
Corporate Advisory Fees: Company Secretarial
Total Expense
$
-
100,815
-
66,150
166,965
$
55,413
51,461
77,922
101,713
286,509
19.
NON CASH INVESTING AND FINANCING ACTIVITIES
On 22 January 2008 3,849,379 ordinary shares were issued to Deep Yellow Ltd as part of the consideration for the
acquisition of the 70% interest in the tenements as outlined in the prospectus dated 29 October 2007.
20.
RELATED PARTY TRANSACTIONS
(a)
Parent and Subsidiary Entities
Manhattan Corporation Limited is not a part of a group and is treated as a single entity.
(b)
Key Management Personnel
Disclosures relating to Key Management Personnel are set out in Note 18.
21.
EVENTS AFTER THE BALANCE SHEET DATE
On 21 July 2009, the Company completed a merger with Manhattan Resources Pty Ltd, following shareholder
approval. It was also agreed to change the Company name to Manhattan Corporation Limited at that meeting. As a
consequence of the merger, the Company has issued a total of 44,201,640 new shares and a number of new
Director, employee and consultant options. Mr Alan Eggers has also joined the Board as Executive Chairman and
Mr John Seton as a Non Executive Director, and Mr David Riekie resigned from the Board. At the date of the
merger, Manhattan Resources Pty Ltd, became a wholly owned subsidiary of the Company. Details of the net
assets held by Manhattan Resources Pty Ltd as at 21 July 2009 were as follows:
36
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
21.
EVENTS AFTER THE BALANCE SHEET DATE (continued)
Manhattan Resources Pty Ltd Merger
21 July 2009
Cash and Cash Equivalents
Trade and Other Receivables
Other Investments
Trade and Other Payables
Deferred Income Tax Expense
Total
Consideration Paid 44,201,640 MHC shares at 16.7 cents each
22.
AUDITOR’S REMUNERATION
$
1,670,111
8,223
6,816,451
(63,236)
(1,034,707)
7,396,842
7,396,842
Audit Services
2009
2008
BDO Kendalls Audit and Assurance (WA) Pty Ltd
Audit and Review of Financial Reports
Tax Work under the Corporations Act 2001
Total Remuneration for Audit Services
$
42,688
8,700
51,388
$
21,688
-
21,688
23.
RECONCILIATION OF CASH FLOWS FROM OPERATING ACTIVITIES
Reconciliation of Cash Flows From Operating Activities
2009
2008
Profit/(Loss) after Income Tax for the Period
Adjustments for:
Depreciation Expense
Exploration Provisions
Profit on Sale of Tenement
Share Based Payments Expense
(Increase)/Decrease in Trade and Other Receivables
(Increase)/Decrease in Prepayments
(Increase)/Decrease in Trade and Other Payables
Cash Flow from/(Used In) Operations
24.
SHARE BASED PAYMENTS
(a)
Options
$
$
(3,223,240)
(374,333)
1,058
2,115,501
(93,004)
161,580
16,855
(39,017)
(233,630)
(1,293,897)
264
-
-
18,150
(48,825)
(10,653)
393,995
(21,402)
The following share based payment arrangements to Directors and employees existed at 30 June 2009.
All options granted to Director’s and employees are for ordinary shares in Manhattan Corporation Limited,
which confer a right of one ordinary share for every option held.
37
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
24.
SHARE BASED PAYMENTS (continued)
Grant Date
Expiry date
Exercise Price
Balance at
Start of Year
Granted
During the
Year
Exercised
During the
Year
Forfieted
During the
Year
Balance at End
of Year
Vested &
Exercisable at
End of Year
22 December 2006
23 June 2008
23 June 2008
22 December 2010
23 June 2013
23 June 2013
23 June 2008
Total Options
23 June 2013
Weighted Average Exercise Price
22 December 2006
22 December 2010
23 June 2008
23 June 2008
23 June 2008
Total Options
23 June 2013
23 June 2013
23 June 2013
Weighted Average Exercise Price
$0.20
$0.20
$0.30
$0.40
$0.20
$0.20
$0.30
$0.40
2009
3,750,000
1,000,000
1,000,000
1,000,000
6,750,000
2008
3,750,000
-
-
-
-
-
-
-
-
-
-
3,750,000
1,000,000
1,000,000
1,000,000
3,000,000
-
-
-
-
-
-
-
-
-
-
-
-
3,750,000
1,000,000
1,000,000
1,000,000
6,750,000
3,750,000
1,000,000
1,000,000
1,000,000
6,750,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
No options expired during the periods covered by the above tables, and there were no options granted
during the current year.
The weighted average remaining contractual life of share options outstanding at the end of the period was
2.33 years.
(b)
Expenses Arising From Share Based Payment Transactions
Expense From Share Based Payment Transactions
Note
2009
2008
Options Issued During the Year
Total Expense
25.
COMMITMENTS
(a)
Exploration Expenditure
18
$
161,580
161,580
$
18,150
18,150
Committed expenditures in accordance with tenement lease grant conditions:
Exploration Expenditure Commitment
2009
2008
Annual Tenement Rental Obligations
Annual Exploration Expenditure Commitments
Total Exploration Expenditure Commitment
$
99,978
729,000
828,978
$
58,277
854,000
912,277
(b)
Capital or Leasing Commitments
There are no capital or leasing commitments as at 30 June 2009.
26.
CONTINGENT LIABILITIES AND CONTINGENT ASSETS
The Directors are of the opinion that there are no contingent liabilities or contingent assets as at 30 June 2009.
38
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES TO THE FINANCIAL STATEMENTS
________________________________________________________________________________
FOR THE YEAR ENDING TO 30 JUNE 2009
27.
INTERESTS IN JOINT VENTURES
Manhattan has the following Joint Venture Interests:
(a)
Exploration Joint Venture Agreements with Deep Yellow Ltd
During the year, Manhattan acquired Deep Yellow Ltd’s interests in the Ponton North, Gardner Range and
Siccus projects, which lifted its interest from 70% held at 30 June 2008 to a 100% holding in the Ponton
North and Gardner Range tenements and to 90% in the Siccus tenement. Signature Resources Pty Ltd
retains a free 10% carried interest in the Siccus tenement (see below). The Anketell project was returned to
Deep Yellow Limited. As a consequence the Joint Venture has been terminated.
(b)
Siccus Farm In and Joint Venture Agreement
The Siccus Project in South Australia comprises one exploration licence EL3288. The Siccus Tenement is
held by Manhattan (90%), (2008: 70%) following the purchase during the year of Deep Yellow’s 20%
interest. Signature Resources Pty Ltd retains its interest of 10% in the project. The Siccus Tenement is
currently subject to the Siccus Farm In and Joint Venture Agreement dated 11 June 1997 ("Siccus JV").
The joint venture is not a separate legal entity. It is a contractual arrangement between the participants
under the signed JV agreement.
Manhattan acts as manager of the JV and sole funds the JV up to the completion of a definitive feasibility
study (should a resource be located within the Tenements) at which point the parties will contribute to the
costs of the JV in proportion to their Joint Venture Interests.
The Joint Venture does not hold any assets and accordingly the Company’s share of exploration, evaluation
and development expenditure is accounted for in accordance with the policy set out in note 1.
39
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
DIRECTORS’ STATEMENT
DIRECTORS’ DECLARATION
In the opinion of the Directors of Manhattan Corporation Limited (“Manhattan”):
(a)
The Financial Statements comprising the Income Statement, Balance Sheet, Cash Flow Statement, Statement of
Recognised Income Expense and the Notes to Accompany the Financial Statements as set out on pages 19 to 39,
are in accordance with the Corporations Act 2001, and:
(i)
(ii)
comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional
reporting requirements; and
give a true and fair view of the financial position of Manhattan as at 30 June 2009 and of its performance for
the Financial Year ended on that date;
In the Directors’ opinion, there are reasonable grounds to believe that Manhattan will be able to pay its debts as
and when they become due and payable;
The remuneration disclosures included in the Directors’ report (as part of the Audited Remuneration report), for the
year ended 30 June 2009, comply with section 300A of the Corporations Act 2001; and
The Directors have been given the declarations required by section 295A of the Corporations Act 2001 from the
Chief Executive and Chief Financial Officers for the Financial Year ended 30 June 2009.
(b)
(c)
(d)
This declaration is made in accordance with a resolution of the Board of Directors and is signed on behalf of the Directors
by:
ALAN J EGGERS
Executive Chairman
25 September 2009
40
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
This statement summarises the main corporate governance practices in place during the Financial Year, which comply
with the ASX Corporate Governance Council recommendations unless otherwise stated.
Further information about the Company’s corporate governance practices is set out on the Company’s web site at
www.manhattancorp.com.au. In accordance with the recommendations of the ASX, information published on the web site
includes charters (for the Board and subcommittees), codes of conduct and other policies and procedures relating to the
Board and its responsibilities.
1.
BOARD OF DIRECTORS
1.1
Role of Board and Management
The Board of Manhattan Corporation Limited (“Manhattan”) is responsible for its corporate governance, that
is, the system by which the Company is managed. In governing the Company, the Directors must act in the
best interests of the Company as a whole. It is the role of senior management to manage the Company in
accordance with the direction and delegations of the Board and the responsibility of the Board to oversee the
activities of management in carrying out these delegated duties.
In carrying out its governance role, the main task of the Board is to drive the performance of the Company.
The Board must also ensure that the Company complies with all of its contractual, statutory and any other
legal obligations, including the requirements of any regulatory body. The Board has the final responsibility for
the successful operations of the Company.
To assist the Board to carry out its functions, it has developed a Code of Conduct to guide the Directors and
key executives in the performance of their roles. The Code of Conduct is detailed in Section 3.1 of this
report.
The Board represents shareholders’ interests in developing and then continuing a successful mineral
resources business, which seeks to optimise medium to long term financial gains for shareholders. By not
focusing on short term gains for shareholders, the Board believes that this will ultimately result in the
interests of all stakeholders being appropriately addressed when making business decisions.
The Board is responsible for ensuring that the Company is managed in such a way to best achieve this
desired result. Given the size of the Company’s exploration and development activities, the Board currently
undertakes an active, not passive role.
The Board is responsible for evaluating and setting the strategic directions for the Company, establishing
goals for management and monitoring the achievement of these goals. The Managing Director is
responsible to the Board for the day to day management of the Company.
The Board has sole responsibility for the following:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
Appointing and removing the Managing Director and any other Executive Director and approving their
remuneration;
Appointing and removing the Company Secretary/Chief Financial Officer and approving their
remuneration;
Determining the strategic direction of the Company and measuring the performance of management
against approved strategies;
Reviewing the adequacy of resources for management to properly carry out approved strategies and
business plans;
Adopting operating and exploration expenditure budgets at the commencement of each Financial
Year and monitoring the progress by both financial and non financial key performance indicators;
Monitoring the Company ’s medium term capital and cash flow requirements;
Approving and monitoring financial and other reporting to regulatory bodies, shareholders and other
organisations;
Determining that satisfactory arrangements are in place for auditing the Company’s financial affairs;
41
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
(cid:120)
(cid:120)
Reviewing and ratifying systems of risk management and internal compliance and control, codes of
conduct and compliance with legislative requirements; and
Ensuring that policies and compliance systems consistent with the Company’s objectives and best
practice are in place and that the Company and its officers act legally, ethically and responsibly on all
matters.
The Board’s role and the Company’s corporate governance practices are being continually reviewed and
improved as the Company’s business develops.
The Board convenes regular meetings with such frequency as is sufficient to appropriately discharge its
responsibilities.
The Board may from time to time, delegate some of its responsibilities listed above to its senior management
team.
The Managing Director is responsible for running the affairs of the Company under delegated authority from
the Board and implementing the policies and strategy set by the Board. In carrying out his responsibilities
the Managing Director must report to the Board in a timely manner and ensure all reports to the Board
present a true and fair view of the Company’s operational results and financial position.
The role of management is to support the Managing Director and implement the running of the general
operations and financial business of the Company, in accordance with the delegated authority of the Board.
1.2
Composition of the Board
To add value to the Company, the Board has been formed so that it has effective composition, size and
commitment to adequately discharge its responsibilities and duties. The names of the Directors and their
qualifications and experience are disclosed in the Directors’ Report. Directors are appointed based on the
specific governance skills required by the Company and on the independence of their decision making and
judgement.
The Company recognises the importance of Non Executive Directors and the external perspective and
advice that Non Executive Directors can offer. Mr Cardaci, the Non Executive Chairman is considered
independent. Mr Riekie is a Non Executive Director that does not meet the independence criteria due to his
involvement with Grange Consulting Pty Ltd in the prior year. The Board believes Mr Riekie is able to, and
has, exercised independent judgement despite this relationship, and deemed Mr Riekie independent. From
the Company’s perspective Directors are considered to be independent when they are independent of
management and free from any business or other relationship which could materially interfere with, or could
reasonably be perceived to materially interfere with, the exercise of their unfettered and independent
judgement.
The Board considers that the current structure is sufficient despite not complying fully with the ASX
Corporate Governance Council Recommendation 2.1.
At present the Board considers that the Company is not currently of a size, nor are its affairs of such
complexity, to justify the expense of the appointment of additional independent Non Executive Directors.
If the Company’s activities increase in size, nature and scope the size of the Board will be reviewed and the
optimum number of Directors required for the Board to properly perform its responsibilities and functions will
be re assessed.
The Board acknowledges that a greater proportion of independent Directors is desirable over the longer term
and will be seeking to demonstrate that it is monitoring the Board’s composition as required.
The membership of the Board, its activities and composition is subject to periodic review. The criteria for
determining the identification and appointment of a suitable candidate for the Board shall include the quality
of the individual’s background, experience and achievement, compatibility with other Board members,
credibility within the Company’s scope of activities, intellectual ability to contribute to Board duties and
physical ability to undertake Board duties and responsibilities.
42
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
Directors are initially appointed by the full Board subject to election by shareholders at the next Meeting of
shareholders. Under the Company’s Constitution the tenure of Directors (other than Managing Director) is
subject to reappointment by shareholders not later than the third anniversary following their last
appointment. Subject to the requirements of the Corporations Act 2001, the Board does not subscribe to the
principle of retirement age and there is no maximum period of service as a Director. A Managing Director
may be appointed for any period and on any terms the Directors think fit and, subject to the terms of any
agreement entered into, the Board may revoke any appointment.
1.3
Responsibilities of the Board
In general, the Board is responsible for, and has the authority to determine, all matters relating to the
policies, practices, management and operations of the Company. It is required to do all things that may be
necessary to be done in order to carry out the objectives of the Company.
Without intending to limit this general role of the Board, the principal functions and responsibilities of the
Board include the following:
1.3.1 Leadership of the Company
Overseeing the Company and establishing codes that reflect the values of the Company and guide
the conduct of the Board, management and employees.
1.3.2 Strategy Formulation
Working with senior management to set and review the overall strategy and goals for the Company
and ensuring that there are policies in place to govern the operation of the Company.
1.3.3 Overseeing Planning Activities
Overseeing the development of the Company’s strategic plans (including exploration programmes
and initiatives) and approving such plans as well as the annual budget.
1.3.4 Shareholder Liaison
Ensuring effective communications with shareholders through an appropriate communications policy
and promoting participation at general meetings of the Company.
1.3.5 Monitoring Compliance and Risk Management
Overseeing the Company’s risk management, compliance, control and accountability systems and
monitoring and directing the operational and financial performance of the Company.
1.3.6 Company Finances
Approving expenses in excess of those approved in the annual budget and approving and monitoring
acquisitions, divestitures and financial and other reporting.
1.3.7 Human Resources
Appointing, and, where appropriate, removing the Managing Director as well as reviewing the
performance of the Managing Director and monitoring the performance of senior management in their
implementation of the Company’s strategy.
1.3.8 Ensuring Health, Safety and Well Being of Employees
In conjunction with the senior management team, developing, overseeing and reviewing the
effectiveness of the Company’s occupational health and safety systems to ensure the well being of all
employees.
1.3.9 Delegating Authority
Delegating appropriate powers to the Managing Director to ensure the effective day to day
management of the Company and establishing and determining the powers and functions of the
Committees of the Board.
43
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
1.4
Board Policies
1.4.1 Conflicts of Interest
Directors must:
(cid:120)
(cid:120)
Disclose to the Board actual or potential conflicts of interest that may or might reasonably be
thought to exist between the interests of the Director and the interests of any other parties in
carrying out the activities of the Company; and
If requested by the Board, within seven days or such further period as may be permitted, take
such necessary and reasonable steps to remove any conflict of interest.
If a Director cannot or is unwilling to remove a conflict of interest then the Director must, as per the
Corporations Act 2001, absent himself from the room when discussion and/or voting occurs on
matters about which the conflict relates.
1.4.2 Commitments
Each member of the Board is committed to spending sufficient time to enable them to carry out their
duties as a Director of the Company.
1.4.3 Confidentiality
In accordance with legal requirements and agreed ethical standards, Directors and key executives of
the Company have agreed to keep confidential, information received in the course of the exercise of
their duties and will not disclose non public information except where disclosure is authorised or
legally mandated.
1.4.4 Independent Professional Advice
The Board collectively and each Director has the right to seek independent professional advice at the
Company’s expense, up to specified limits, to assist them to carry out their responsibilities.
1.4.5 Related Party Transactions
Related party transactions include any financial transaction between a Director and the Company.
Unless there is an exemption under the Corporations Act 2001 from the requirement to obtain
shareholder approval for the related party transaction, the Board cannot approve the transaction.
1.4.6 Trading in the Company Shares
The Company’s share trading policy imposes basic trading restrictions on all employees of the
Company with ‘inside information’, and additional trading restrictions on the Directors of the
Company.
‘Inside information’ is information that:
(cid:120)
(cid:120)
Is not generally available; and
If it were generally available, it would, or would be likely to, influence investors in deciding
whether to buy or sell the Company’s securities.
If an employee possesses inside information, the person must not:
(cid:120)
(cid:120)
(cid:120)
Trade in the Company’s securities;
Advise others or procure others to trade in the Company’s securities; or
Pass on the inside information to others, including colleagues, family or friends knowing (or
where the employee or Director should have reasonably known) that the other persons will
use that information to trade in, or procure someone else to trade in, the Company’s
securities.
44
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
This prohibition applies regardless of how the employee or Director learns the information (eg. even if
the employee or Director overhears it or is told in a social setting).
In addition to the above, Directors must notify the Company Secretary as soon as practicable, but not
later than 2 business days, after they have bought or sold the Company’s securities or exercised
options. In accordance with the provisions of the Corporations Act 2001 and the ASX Listing Rules,
the Company on behalf of the Directors must advise the ASX of any transactions conducted by them
in the securities of the Company.
1.4.7 Attestations by the Managing Director and Company Secretary
In accordance with the Board’s policy, the Managing Director and the Company Secretary/Chief
Financial Officer made the attestations recommended by the ASX Corporate Governance Council,
and s295A of the Corporations Act 2001 as to the Company’s financial condition prior to the Board
signing this Annual Report.
2.
BOARD COMMITTEES
The Board considers that the Company is not currently of a size, nor are its affairs of such complexity to justify the
formation of separate or special committees at this time. The Board as a whole is able to address the governance
aspects of the full scope of the Company’s activities and to ensure that it adheres to appropriate ethical standards.
The Board has however established a framework for the management of the Company including a system of
internal controls, a business risk management process and the establishment of appropriate ethical standards.
The full Board currently holds meetings at such times as may be necessary to address any general or specific
matters as required.
If the Company’s activities increase in size, scope and nature, the appointment of separate or special committees
will be reviewed by the Board and implemented if appropriate.
2.1
Audit Committee
The full Board carries out the role of the audit committee. While this is a departure from ASX Corporate
Governance Council Recommendations 4.1 and 4.2, it provides a more efficient mechanism based on the
size of the Board and the complexity of the Company. The Board follows the Audit Committee charter and
there were two meetings during the year set aside to deal with the issues and responsibilities usually
delegated to the audit committee so as to ensure the integrity of the Financial Statements of the Company
and the independence of the external auditor.
The Board in its entirety reviews the audited Annual Financial Statements and the audit reviewed Half Yearly
Financial Statements and any reports which accompany published Financial Statements.
The Board in its entirety considers the appointment of the external auditor and reviews the appointment of
the external auditor, their independence, the audit fee and any questions of resignation or dismissal.
The Board is also responsible for establishing policies on risk oversight and management.
2.2
Remuneration Committee
The full Board carries out the role of the remuneration committee. While this is a departure from ASX
Corporate Governance Council Recommendation 8.1, it provides a more efficient mechanism based on the
size of the Board and the complexity of the Company. The Board follows the Remuneration Committee
charter and there was one meeting during the year set aside to deal with remuneration issues.
The responsibilities of the Board in its entirety include setting policies for senior officers’ remuneration,
setting the terms and conditions of employment for the Managing Director, reviewing and setting
Manhattan’s issue of options to employees and consultants, reviewing superannuation arrangements,
reviewing the remuneration of Non Executive Directors and undertaking an annual review of the Managing
Director’s performance, including, setting with the Managing Director goals for the coming year and
reviewing progress in achieving those goals.
The Company is committed to remunerating its executives in a manner that is market competitive and
consistent with best practice as well as supporting the interests of shareholders.
45
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
There is no scheme to provide retirement benefits, other than statutory superannuation, to Non Executive
Directors.
For a full discussion of the Company’s remuneration philosophy and framework and the remuneration
received by Directors in the current period please refer to the Remuneration Report, which is contained
within the Directors’ Report.
2.3
Nomination Committee
The full Board carries out the role of the nomination committee. While this is a departure from ASX
Corporate Governance Council Recommendation 2.4, it provides a more efficient mechanism based on the
size of the Board and the complexity of the Company. The Board follows the Nomination Committee charter
and sets aside time at Board meetings to deal with nomination issues.
The responsibilities of the Board in its entirety include devising criteria for Board membership, regularly
reviewing the need for various skills and experience on the Board and identifying specific individuals for
nomination as Directors for review by the Board. The Board also oversees management succession plans
including the Managing Director, and evaluates the Board’s performance and makes recommendations for
the appointment and removal of Directors.
Directors are appointed based on the specific governance skills required by the Company. Given the size of
the Company and the business that it operates, the Company aims at all times to have at least one Director
with experience in the mining and exploration industry, appropriate to the Company’s market. In addition,
Directors should have the relevant blend of personal experience in:
(cid:120)
(cid:120)
(cid:120)
Accounting and financial management;
Legal skills; and
For the managing Director the appropriate business experience.
3.
ETHICAL STANDARDS
The Board acknowledges the need for continued maintenance of the highest standard of corporate governance
practice and ethical conduct by all Directors and employees of the Company.
3.1
Code of Conduct for Directors and Key Executives
The Board has adopted a Code of Conduct for Directors and key executives to promote ethical and
responsible decision making. The code is based on a code of conduct for Directors prepared by the
Australian Institute of Company Directors.
In accordance with legal requirements and agreed ethical standards, Directors and key executives of the
Company:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
Will act honestly, in good faith and in the best interests of the whole Company;
Owe a fiduciary duty to the Company as a whole;
Have a duty to use due care and diligence in fulfilling the functions of office and exercising the
powers attached to that office;
Will act with a level of skill expected from Directors and key executives of a publicly listed company;
Will use the powers of office for a proper purpose and in the best interests of the Company as a
whole;
Will demonstrate commercial reasonableness in decision making;
Will not make improper use of information acquired as Directors and key executives;
Will not disclose non public information except where disclosure is authorised or legally mandated;
Will not take improper advantage of the position of Director or use the position for personal gain or to
compete with the Company;
46
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
Will not take advantage of Company property or use such property for personal gain or to compete
with the Company;
Will protect and ensure the efficient use of the Company’s assets for legitimate business purposes;
Will not allow personal interests, or the interests of any associated person, to conflict with the
interests of the Company;
Have an obligation to be independent in judgment and actions and Directors will take all reasonable
steps to be satisfied as to the soundness of all decisions of the Board;
Will make reasonable enquiries to ensure that the Company is operating efficiently, effectively and
legally towards achieving its goals;
Will not engage in conduct likely to bring discredit upon the Company;
Will encourage fair dealing by all employees with the Company’s suppliers, competitors and other
employees;
Will encourage the reporting of unlawful/unethical behaviour and actively promote ethical behaviour
and protection for those who report violations in good faith;
Will give their specific expertise generously to the Company; and
Have an obligation, at all times, to comply with the spirit, as well as the letter of the law and with the
principles of this Code.
3.2
Code of Ethics and Conduct
The Company has implemented a Code of Ethics and Conduct, which provides guidelines aimed at
maintaining high ethical standards, corporate behavour and accountability within the Company.
All Directors and employees are expected to:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
Respect the law and act in accordance with it;
Respect confidentiality and not misuse Company information, assets or facilities;
Value and maintain professionalism;
Avoid real or perceived conflicts of interest;
Act in the best interests of shareholders;
By their actions, contribute to the Company’s reputation as a good corporate citizen, which seeks the
respect of the community and environment in which it operates;
Perform their duties in ways that minimise environmental impacts and maximise workplace safety;
Exercise fairness, courtesy, respect, consideration and sensitivity in all dealings within their
workplace and with customers, suppliers and the public generally; and
Act with honesty, integrity, decency and responsibility at all times.
An employee that breaches the Code of Ethics and Conduct may face disciplinary action. If an employee
suspects that a breach of the Code of Ethics and Conduct has occurred or will occur, he or she must advise
that breach to management. No employee will be disadvantaged or prejudiced if he or she reports in good
faith a suspected breach. All reports will be acted upon and kept confidential.
As part of its commitment to recognising the legitimate interests of stakeholders, the Company has
established the Code of Ethics and Conduct to guide compliance with legal and other obligations to
legitimate stakeholders. These stakeholders include employees, government authorities, creditors and the
community as whole. This Code includes the following:
47
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
3.2.1 Responsibilities to Shareholders and the Financial Community Generally
The Company complies with the spirit as well as the letter of all laws and regulations that govern
shareholders’ rights. The Company has processes in place designed to ensure the truthful and
factual presentation of the Company’s financial position and prepares and maintains its accounts
fairly and accurately in accordance with the generally accepted accounting and financial reporting
standards.
3.2.2 Employee Practices
The Company endeavours to provide a safe workplace in which there is equal opportunity for all
employees at all levels of the Company. The Company does not tolerate the offering or acceptance
of bribes or the misuse of the Company’s assets or resources.
3.2.3 Responsibilities to the Community
As part of the community the Company:
(cid:120)
(cid:120)
(cid:120)
Is committed to conducting its business in accordance with applicable environmental laws and
regulations and encourages all employees to have regard for the environment when carrying
out their jobs;
encourages all employees to engage in activities beneficial to their local community; and
supports community charities.
The Company supports the Indigenous Community:
(cid:120)
(cid:120)
Is committed to conducting its business in accordance with applicable heritage laws and
regulations and encourages all employees to have regard for the specific rights of indigenous
communities when carrying out their jobs; and
Encourages all employees to engage in activities beneficial to the indigenous community.
3.2.4 Responsibilities to the Individual
The Company is committed to keeping private information, which has been provided by employees
and investors confidential and protecting it from uses other than those for which it was provided.
3.2.5 Conflicts of interest
Employees and Directors must avoid conflicts as well as the appearance of conflicts between their
personal interests and the interests of the Company.
3.2.6 How the Company Monitors and Ensures Compliance with its Code
The Board, management and all employees of the Company are committed to implementing this
Code of Ethics and Conduct and each individual is accountable for such compliance.
Disciplinary measures may be imposed for violating the Code.
4.
DISCLOSURE OF INFORMATION
4.1
Continuous Disclosure to ASX
The continuous disclosure policy requires all executives and Directors to inform the Managing Director or, in
their absence, the Company Secretary of any potentially material information as soon as practicable after
they become aware of that information.
Information is material if it is likely that the information would influence investors who commonly acquire
securities on ASX in deciding whether to buy, sell or hold the Company’s securities.
Information is not material and need not be disclosed if:
4.1.1 A reasonable person would not expect the information to be disclosed or it is material but due to a
specific valid commercial reason is not to be disclosed; and
48
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
4.1.2 The information is confidential; or
4.1.3 One of the following applies:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
It would breach a law or regulation to disclose the information;
The information concerns an incomplete proposal or negotiation;
The information comprises matters of supposition or is insufficiently definite to warrant
disclosure;
The information is generated for internal management purposes;
The information is a trade secret;
It would breach a material term of an agreement, to which the Company is a party, to disclose
the information;
It would harm the Company’s potential application or possible patent application; or
The information is scientific data that release of which may benefit the Company’s potential
competitors.
The Managing Director is responsible for interpreting and monitoring the Company’s Disclosure policy and
where necessary informing the Board. The Company Secretary is responsible for all communications with
ASX.
4.2
Communication with Shareholders
The Company places considerable importance on effective communications with shareholders.
The Company’s communication strategy requires communication with shareholders and other stakeholders
in an open, regular and timely manner so that the market has sufficient information to make informed
investment decisions on the operations and results of the Company. The strategy provides for the use of
systems that ensure a regular and timely release of information about the Company to be provided to
shareholders. Mechanisms employed include:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
Announcements lodged with ASX;
ASX Quarterly Reports;
Half Yearly Report and Annual Report; and
Presentations at the Annual General Meeting and General Meetings of shareholders.
The Board encourages the full participation of shareholders at the Annual General Meeting to ensure a high
level of accountability and understanding of the Company’s strategy and goals.
The Company also posts all reports, ASX and media releases and copies of business and investor
presentations on the Company’s web site.
5.
RISK MANAGEMENT
5.1
Identification of Risk
Manhattan operates in the mineral resource and energy sectors where there are a number risk factors
inherent to the Company’s operations. The Company mitigates its risk factors primarily by ensuring it has a
suitably qualified and experienced Board of Directors with a range of professional qualifications appropriate
to the industry and business sector in which it operates.
49
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
Recognition of these risk factors and subsequent effective management, control and reporting of risk are an
essential part of the Company’s day to day operations to minimise potential losses and create medium to
long term shareholder wealth. The Board is responsible for the oversight, adequacy and implementation of
the Company’s risk management and control framework. Responsibility for internal control and risk
management is delegated to the appropriate level of management within the Company with the Managing
Director and Company Secretary having ultimate responsibility to the Board for the identification of risk, risk
management and internal control framework.
Areas of strategic, operational, legal, reporting, compliance, business and financial risks are identified,
assessed and continually monitored by executive management to assist the Company to achieve its
business objectives. These areas of risk are highlighted in the Business Plan presented to the Board by the
Managing Director on a regular basis. Arrangements put in place by the Board to monitor risk management
include monthly reporting by executive management to the Board in respect of operations and the financial
position of the Company and ensuring all legal, reporting and compliance matters and obligations are met.
The main operational risks for Manhattan in the industry and business sector in which it operates have been
identified as:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
(cid:120)
Sovereign risk, legislation and political issues;
Government policies and changes to those policies;
Financial and equity markets stability;
Fluctuating commodity prices and demand;
Fluctuating exchange rates;
Compliance with licence and permit conditions;
Land access, environmental and Native Title issues;
Availability of specialist drilling, laboratory, exploration support and transport services;
Availability of specialist airborne geophysical survey contractors and consultants;
Availability of suitably experienced and qualified professionals, personnel and consultants;
Increasing costs of operations;
Availability of capital and debt facilities; and
Retention of key executives and staff.
These risks areas identified by the Company’s Board are provided here to assist shareholders better
understand the nature of the risks faced by the Company, and other companies, in the industry sector in
which it operates. They are not necessarily an exhaustive list.
5.2
Integrity of Financial Reporting
The Company’s Managing Director and Chief Financial Officer report in writing to the Board that:
(cid:120)
(cid:120)
(cid:120)
(cid:120)
The Financial Statements of the Company for each Half Year and Financial Year present a true and
fair view, in all material aspects, of the Company’s financial condition and operational results and are
in accordance with accounting standards;
The financial records of the Company for each Half Year and Financial Year have been properly
maintained and the financial reporting is in accordance with section 295A(2) of the Corporations Act
2001;
The above statement is founded on a sound system of risk management and internal compliance and
control which implements the policies adopted by the Board; and
The Company’s risk management and internal compliance and control framework is operating
efficiently and effectively in all material respects.
50
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
CORPORATE GOVERNANCE STATEMENT
The Board notes that due to its nature, internal control assurance from the Managing Director and Chief
Financial Officer can only be reasonable and not absolute. This is due to such factors as the need to apply
judgment, reasonable enquiry and practical and efficient internal control systems, inherent limitations to
internal control and because much of the evidence available is persuasive and changing rather than
conclusive and set and therefore is not and cannot be designed to detect all weaknesses in control
procedures.
Internal management accounts are prepared on a monthly basis, full Cash Flow Statements on a quarterly
basis and lodged with the ASX and a Half Year audit reviews and Financial Year audits are completed by
the Company’s independent Auditors. The Half Year and Financial Year Financial Statements are lodged
with ASX and posted on the Company’s web site.
5.3
Audit and Role of Auditor
The Company’s internal preparation for the Half Yearly audit review and the Financial Year audit includes
preparing the Financial Statements and accompanying explanatory notes, conducting a series of routine
reviews and financial tests and reviewing the carrying values of all assets. The Company’s Auditor is
required to attend the Annual General Meeting and be available to answer shareholder questions about the
conduct of the audit and the preparation and content of the Auditor’s Report.
Manhattan provides updates on any changes in its circumstances as and when they occur by continuous
disclosure in compliance with the ASX Listing Rules, press releases, investor presentations and making all
announcements and corporate information available on the Company’s web site.
6.
PERFORMANCE REVIEW
The Board has adopted and undertaken a self evaluation process to measure its own performance during the
Financial Year. This process included a review of the performance of the Board individually and as a whole, and
included a review in relation to the composition and skills mix of the Directors of the Company.
Arrangements undertaken during the year to monitor the performance of the Company’s executives included:
(cid:120)
(cid:120)
A review by the Board of the Company’s financial performance; and
Annual performance appraisal meetings incorporating analysis of key performance indicators with each
individual to ensure that the level of reward is aligned with respective responsibilities and individual
contributions made to the success of the Company.
51
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
ADDITIONAL SHAREHOLDER INFORMATION
Additional information required by ASX Limited Listing Rules not disclosed elsewhere in this Annual Report is set out
below.
1.
ANALYSIS OF SHAREHOLDINGS
As at 9 October 2009 Manhattan Corporation Limited has on issue 83,481,019 ordinary shares. All issued ordinary
fully paid shares carry one vote per share. There are six hundred and fourteen (614) holders of fully paid ordinary
shares on Manhattan’s share register as at 9 October 2009.
1.1
Top Twenty Shareholders
The names of shareholders in Manhattan Top Twenty as at 9 October 2009 are as follows:
TOP 20 SHAREHOLDERS
Rank Holder
Number
Percentage
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Minvest Securities (New Zealand) Limited
Nicholas P S Olissoff
Alan J Eggers
Thomas Allright
E S & J T Arron
Claymore Trustees Limited
Grange Consulting Group Pty Ltd
Custodial Services Limited
Forbar Custodians Limited
Resmin Pty Ltd
Marcello Cardaci
Michael Ashforth
Residuum Nominees Pty Ltd
UBS Wealth Management Australia Nominees Pty Ltd
Susan J Campbell
Sue N Rowles
Robert Sommerville
K E & L A Tatam
Sundowner International Limited
UBS Wealth Management
TOTAL
19,129,040
7,664,520
6,918,899
4,480,082
4,000,000
3,407,260
2,500,000
2,366,369
2,063,825
1,894,356
1,565,726
1,262,904
1,250,000
1,182,952
821,452
746,452
731,452
631,452
631,452
631,452
22.91
9.18
8.29
5.37
4.79
4.08
2.99
2.83
2.47
2.27
1.88
1.51
1.50
1.42
0.98
0.89
0.88
0.76
0.76
0.76
63,879,645
76.52
1.2
Spread of Security Holders
As at 9 October 2009 Manhattan had 614 holders of ordinary shares with the spread of security holders as
follows:
SPREAD OF SECURITY HOLDERS
Size of Holding
Number of Holders
Shares Held
Percentage Held
1
1,001
5,001
10,001
100,001
-
-
-
-
-
TOTAL
1,000
5,000
10,000
100,000
Over
17
126
150
263
58
614
9,804
437,614
1,369,760
9,571,350
72,092,491
83,481,019
0.01
0.52
1.64
11.47
86.36
100.00
52
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
ADDITIONAL SHAREHOLDER INFORMATION
1.3
Minimum Holdings and Marketable Parcels
As at 9 October 2009 there were eight (8) holders holding less than a Marketable Parcel of ordinary shares
as defined in Chapter 19 of the ASX Listing Rules. A marketable Parcel is a parcel of securities (ordinary
shares) of not less than $500.00 based on the closing price on SEATS.
1.4
Unlisted Options
The unissued ordinary shares of Manhattan under option as at 9 October 2009 total 20,849,379 options. The
options do not carry a right to vote at a general meeting of shareholders. Manhattan’s unlisted option details
are as follows:
UNLISTED OPTIONS
Vesting Date
Exercise Price
Number of Options
Number of Holders
Expiry Date
N/A
N/A
23 December 2009
20 July 2010
20 July 2011
TOTAL
$0.20
$0.20
$0.20
$0.60
$1.00
5,000,000
3,849,379
1,000,000
5,500,000
5,500,000
20,849,379
3
3
1
7
7
30 June 2010
21 January 2012
23 June 2013
21 July 2014
21 July 2014
1.5
Restricted Securities Subject to Escrow Period
As at 9 October 2009 Manhattan had a total of 5,020,000 ordinary shares and 5,000,000 $0.20 options the
subject to a 24 month escrow period expiring on 28 January 2010 as follows:
RESTRICTED SECURITIES
Class of Security
Period of Escrow
Expiry of Escrow
Total
Ordinary Shares
Options (Exercisable at $0.20 on or before 30 June 2010)
24 months
24 months
28 January 2010
28 January 2010
5,020,000
5,000,000
1.6
Substantial Shareholders
The following are registered by the Company as at 9 October 2009 as substantial security holders in the
Company, having declared the following relevant interests in voting securities in terms of section 671B of the
Corporations Act 2001:
SUBSTANTIAL SHAREHOLDERS
Substantial Security Holder
Number
Percentage
Alan J Eggers and Associates
Nicholas P S Olissoff
Thomas Allright
TOTAL
26,047,939
7,664,520
4,480,082
38,192,541
31.20
9.18
5.37
45.75
53
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
ADDITIONAL SHAREHOLDER INFORMATION
1.7
Share Registrar
Manhattan’s share registered is maintained in Perth at:
Computershare Investor Services Pty Ltd
Level 2, Reserve Bank Building
45 St Georges Terrace
PERTH WA 6000
Investor Enquiries:
Facsimile:
Web Site:
1300 307 518
+61 8 9323 2033
www.computershare.com.au
1.8
Voting Rights
On a show of hands every shareholder present in person or by a proxy shall have one vote and upon a poll
each fully paid ordinary share shall have one vote.
1.9
Stock Exchange Listings
Manhattan’s ordinary shares have been granted quotation on the Australian Stock Exchange Limited
(“ASX”).
1.10 On Market Buyback
Currently, there is no on market buy back of the Company’s securities.
54
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
________________________________________________________________________________
ADDITIONAL SHAREHOLDER INFORMATION
2.
TENEMENT SCHEDULE
As at 12 October 2009 Manhattan held interests in the following exploration tenements:
WESTERN AUSTRALIA
Tenement
Number
Project
Registered
Holder(s)
Manhattan's
Interest
Date Granted
Expiry Date
Area
Notes
E39/1140
E39/1141
E39/1142
E39/1143
E39/1144
E28/1523
E28/1898
E28/1979
E28/1983
E80/1735
E80/3275
E80/3817
E80/4081
Ponton
Ponton
Ponton
Ponton
Ponton
Ponton
Ponton
Ponton
Ponton
Gardner Range
Gardner Range
Gardner Range
Gardner Range
MHC
MHC
MHC
MHC
MHC
PDN
MHC
MHC
MHC
MHC
MHC
DYL
DYL
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
24 Aug 2006
24 Aug 2006
24 Aug 2006
24 Aug 2006
24 Aug 2006
26 Nov 2008
App
App
App
15 Mar 1994
11 Nov 2005
23 Oct 2008
03 Mar 2009
23 Aug 2011
23 Aug 2011
23 Aug 2011
23 Aug 2011
23 Aug 2011
25 Nov 2013
App
App
App
14 Mar 2010
10 Nov 2010
22 Oct 2013
02 Mar 2014
70 sub blocks
70 sub blocks
70 sub blocks
70 sub blocks
70 sub blocks
20 sub blocks
64 sub blocks
74 sub blocks
48 sub blocks
12 sub blocks
54 sub blocks
70 sub blocks
43 sub blocks
(1)
(2)
(3)
(4)
(5)
(6)
SOUTH AUSTRALIA
EL3288
Siccus
MHC/SRPL
90%
02 Feb 2004
01 Dec 2009
675km2
QUEENSLAND
EPM17319
EPM17320
Annable South
Annable North
MRPL
MRPL
100%
100%
App
App
App
App
4 sub blocks
16 sub blocks
(7)
(7)
Notes
(1)
(2)
(3)
(4)
(5)
(6)
(7)
Abbreviations
E
EL
EPM
km2
App
Areas
Western Australia
Ponton Project
Gardner Project
South Australia
Siccus Project
Queensland
Annable Project
Tenement acquired from Paladin Energy Ltd (PDN). To be transferred to MHC 26 November 2009
Application lodged with DMP on 6 October 2008
Application lodged with DMP on 31 August 2009
Application lodged with DMP on 30 September 2009
Tenement acquired from Deep Yellow Ltd (DYL). To be transferred to MHC 23 October 2009
Tenement acquired from Deep Yellow Ltd (DYL). To be transferred to MHC 18 January 2010
Applications lodged with DME on 1 February 2008 (Annable North & South).
Exploration Licence WA
Exploration Permit SA
Exploration Permit Minerals QLD
Square Kilometre
Application Lodged
DMP
PIRSA
DME
MHC
MRPL
SRPL
Western Australian Department of Mines and Petroleum
South Australian Department of Primary Industry and Resources
Queensland Department of Mines and Energy
Manhattan Corporation Limited ABN 61 123 156 089
Manhattan Resources Pty Ltd ABN 81 127 373 871
Signature Resources Pty Ltd ABN 20 077 307 012
556 sub blocks
179 sub blocks
20 sub blocks
1 Sub block
Total Area
Total Area
Total Area
1 Sub block
Total Area
55
2.97km2
1,650km2
550km2
675km2
3.20km2
65km2
2009 ANNUAL REPORT
MANHATTAN CORPORATION LIMITED
NOTES
________________________________________________________________________________
56
BUSINESS OFFICE
Ground Floor
15 Rheola Street
WEST PERTH WA 6005
PO Box 1038
WEST PERTH WA 6872
Telephone: +61 8 9322 6677
+61 8 9322 1961
Facsimile:
Email:
Web Site:
info@manhattancorp.com.au
www.manhattancorp.com.au