Telstra 2001 Annual Report Download - page 34

P.32
Directors’ report continued
Under current legislation, it is expected that
Telstra will be able to fully frank declared ordinary
dividends out of fiscal 2002 earnings. However, the
directors can give no assurance as to the future
level of dividends, if any, or of franking of dividends.
This is because our ability to pay dividends
depends upon, among other factors, our earnings,
government legislation and our tax position.
SSiiggnniiffiiccaanntt cchhaannggeess iinn tthhee ssttaattee ooff aaffffaaiirrss
There have been no significant changes in the
state of affairs of Telstra during the financial
year other than:
• the completion of our strategic alliance
with Pacific Century CyberWorks (PCCW)
on 7 February 2001 in accordance with our
13 October 2000 agreements. The key terms of the
alliance with effect from 1 February 2001 were:
• the establishment of Reach Ltd, a 50:50 joint
venture entity operating as a provider of voice,
data and internet connectivity services in the
Asia-Pacific region. Reach was formed through
the combination of the sale of our international
wholesale businesses and certain wholesale
assets together with certain PCCW assets;
• the acquisition of a 60% controlling interest in
RWC from PCCW; and
• the purchase of a convertible note from PCCW
with a face value of US$750 million. The note
is subordinated, but is secured by an equitable
mortgage over half of PCCW’s 50% shareholding
in Reach (ie 25% of Reach’s total shares).
LLiikkeellyy ddeevveellooppmmeennttss
The directors believe, on reasonable grounds,
that Telstra would be likely to be unreasonably
prejudiced if the directors were to provide more
information than there is in this report or the
financial report about:
• the likely developments in Telstra’s operations; or
• the expected results of those operations in
the future.
DDeettaaiillss aabboouutt ddiirreeccttoorrss
RReettiirreemmeenntt ooff ddiirreeccttoorrss
Cecilia A Moar, Christopher I Roberts and
Stephen W Vizard did not seek re-election and
retired from office at the annual general meeting
on 17 November 2000. The board thanks the
directors for their valuable contribution during
their terms of office and welcomes the
appointment of new directors.
Information about directors is provided as follows
and forms part of this directors’ report:
• names of directors and details of their
qualifications, experience and special
responsibilities are given on pages 28 and 29;
• number of board and committee meetings and
attendance by directors at these meetings is
provided on page 34;
• details of directors’ shareholdings in Telstra are
shown on page 35; and
• details of directors’ emoluments are given on
page 36.
SSeenniioorr eexxeeccuuttiivvee eemmoolluummeennttss
This information is provided on pages 38 to 39
and forms part of this report.
D
Diirreeccttoorrss’’ aanndd ooffffiicceerrss’’ iinnddeemmnniittyy
Constitution
Our constitution provides for us to indemnify each
officer to the maximum extent permitted by law
for any liability incurred as an officer provided that:
• the liability is not owed to us or a related
body corporate;
• the liability is not for a pecuniary penalty or
compensation order made by a Court under
the Corporations Act; and
• the liability does not arise out of conduct
involving a lack of good faith. Our constitution
also provides for us to indemnify each officer, to
the maximum extent permitted by law, for legal
costs and expenses incurred in successfully
defending civil or criminal proceedings.
Our Corporate Governance statement is contained in our 2001 Annual Report