Axiom 2014 Annual Report - page 110

Notes to the Financial Statements
for the year ended 30 September 2014
108
Axiom Mining Limited
21. Contingent asset and contingent liabilities
Contingent liabilities
Contingent liabilities of the Group for which no amount has been provided in the financial statements include:
2014
$000
2013
$000
Funds held in trust relating to Solomon Islands court proceedings
121
269
Rental bond deposits paid for office accommodation
10
–
131
269
22. Subsequent events
a. Solomon Islands High Court case 258/11 between SMM Solomon Limited (“Sumitomo”) and others v Axiom KB
Limited (“Axiom”), Solomon Islands Government and others.
On 24 September 2014 the High Court of the Solomon Islands dismissed all of Sumitomo’s claims and enabled Axiom
to recommence exploration activities on the Isabel nickel deposit. Included in this judgement was the existence of
Sumitomo’s undertaking as to damages in respect of any damages claimed by Axiom, as well as the statement that
arguments on costs were to be determined.
On 30 September 2014 the Chief Justice of the Court of Appeal of the Solomon Islands granted an interim injunction
to halt drilling and exploration activities on Isabel Island.
On 8 October 2014, the Solomon Islands Court of Appeal ruled in favour of Axiom and set aside the interim injunction
granted on 30 September 2014 and awarded costs to Axiom both in relation to the hearing on 30 September 2014 and
the hearing on 8 October 2014.
On 27 October 2014 Sumitomo filed a notice of appeal to the Solomon Islands Court of Appeal in response to the
judgement delivered in favour of Axiom. It is expected the appeal will be heard in mid-2015.
On 29 October 2014 Axiom filed submissions and supporting evidence to recover costs from Sumitomo related to the
Solomon Islands Court Case 258/2011 (proceeding) of Solomon Island Dollars 41,025,000 (approximately $6,500,000).
On 20 November 2014 Axiom’s drilling program for the Isobel Nickel Project commenced.
On 24 November 2014 Axiom announced the company was in negotiations with third parties regarding potential
involvement in the Isabel Nickel Project. Negotiations were occurring with nickel industry participants and mining
services providers over mine development and operation, processing of ore and offtake agreements.
On 30 December 2014 Axiom announced that it had entered into a strategic partnership with Anitua Limited, an
exploration and mining services provider, for the Isabel Nickel Project. Anitua has provided Axiom with an unsecured
loan of $5 million, to be repaid no later than 7 July 2015.
On 16 January 2015 Sumitomo provided the High Court of the Solomon Islands with two bank guarantees totalling
approximately $5 million for Axiom’s costs relating to the High Court case. Axiom will be entitled to recover these costs
upon obtaining a favourable judgement in the appeal.
On 6 February 2015 the Chief Justice of the Solomon Islands Court of Appeal indicated that the appeal could potentially
be listed for hearing commencing 26 May 2015. This date was later confirmed by the Court of Appeal.
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