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Notes to the

financial statements

for the year ended 30 September 2015


24. Contingent asset and contingent


Contingent assets

On 24 September 2014 the High Court of the Solomon

Islands dismissed all of SMM Solomon Limited’s claims

and enabled Axiom to recommence exploration activities

on the Isabel nickel deposit. On 29 October 2014, Axiom

filed submissions and supporting evidence to recover

costs from SMM Solomon Limited (‘Sumitomo’) related to

the Solomon Islands Court Case 258/2011.

On 16 January 2015, Sumitomo provided two irrevocable

and unconditional bank guarantees with a commercial

bank in Solomon Islands for the full sums of:

USAU$3.9 million for Axiom’s costs relating to the

original High Court case

USAU$177,200 as security for Axiom’s costs of

the appeal.

Axiom will be entitled to recover the costs upon obtaining

a favourable judgment in the appeal in the Court of Appeal

of Solomon Islands, which was heard by a panel of three

Commonwealth judges from 26 May 2015 to 5 June 2015.

The Court of Appeal has reserved judgement and no

ruling has been hand down at the date of this report.

Contingent liabilities

As at the date of this report there are no contingent


25. Events after the reporting period

Axiom had a resounding High Court victory against

SMM Solomon Limited (‘Sumitomo’) in September 2014

in relation to the validity of the Prospecting Licence and

50-year registered lease over the land covering the Isabel

Nickel Project.

On 27 October 2014, Sumitomo filed a notice of appeal

in response to the High Court trial judgement, which was

heard between 26 May 2015 and 5 June 2015 in the Court

of Appeal of Solomon Islands.

The Court of Appeal has reserved judgement and no

ruling has been hand down at the date of this report.

Subsequent to the year end, on 4 November 2015 the

Company announced that it had entered into a convertible

note facility agreement for up to AU$15 million to project

fund the development of the Isabel Nickel Project through

a strategic partnership with experienced resource venture

capitalist and project incubator InCor Holdings Plc


As part of the agreement, Axiom issued one secured

convertible note with a face value of AU$5,000,000,

convertible to a maximum issue of 13,513,514 fully paid

ordinary shares based on a conversion price of AU$0.37

per share.

The note is for the period of 24 months with interest rate of

6% per annum payable in advance for the first 12 months

and thereafter quarterly in advance. Interest has been

satisfied by Axiom by issuing shares at a fixed price of

AU$0.37. The facility is secured through the first ranking

charge over Axiom’s assets in Australia and Hong Kong.

Apart from the matters mentioned above, no other matters

or circumstances have arisen since 30 September 2015

that significantly affected or could significantly affect the

operations of the Consolidated Group in future years.

Apart from the matters discussed, no person has applied

for leave of court to bring proceedings on behalf of the

Company or 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 any part of such