Axiom Mining 2015 Annual Report

COMPANY FINANCIAL REPORT

Notes to the financial statements for the year ended 30 September 2015

103

26. Directors remuneration (continued)

Short term incentives Rights (STI Rights) Mr Mount was to be issued 2,400,000 Rights (STI Rights) vesting immediately upon approval by the shareholders (approved on 31 March 2015) and execution of a service agreement between the Company and Mr Mount (executed 21 May 2015). However the rights will not be exercisable by Mr Mount until after the Appeal of the Proceedings has been completed and a decision handed down. Long term incentive Rights (LTI Rights) Mr Mount was to be issued 9,600,000 Rights (LTI Rights) upon approval by the shareholders (approved on 31 March 2015) and execution of a service agreement between the Company and Mr Mount (executed 21 May 2015) in tranches where the Company’s Share price exceeds the following thresholds during the specified periods (each a Performance Condition):

Price Threshold

Number of Rights Issued in each Tranche

Period

2,400,000 2,400,000 2,400,000 2,400,000

1 March 2016 to 28 February 2017 1 March 2017 to 28 February 2018 1 March 2018 to 28 February 2019 1 March 2019 to 28 February 2020

34.5 cents 43.5 cents 55.5 cents 69.0 cents

AXIOM MINING LIMITED ANNUAL REPORT 2015

Once vested, the LTI Rights will be exercisable six months after the end of the relevant measurement period. The Company may cancel the Performance rights in the following circumstances (‘Performance Conditions’): a. in their entirety, in the event that, as a result of the Court’s findings in the Appeal of the Proceedings, the Company is prevented from continuing exploration and subsequent mining activities in connection with the Isabel Nickel Project within 12 months after the Appeal decision is handed down; or b. pro-rata, in the event that Mr Mount ceases to be employed by the Company before the end of the five year term (other than termination by the Company without cause or where a change of control event (as defined under the Director and Executive Performance Rights Plan) occurs. Each tranche of Rights will be issued at a nil exercise price. The rights are subject to the satisfaction of the relevant Performance Conditions, vesting and exercise, each Right entitles Mr Mount to one Share. The maximum number of Rights and hence the maximum number of Shares that may be issued to Mr Mount, and in the case of the LTI Rights, subject to the satisfaction of the relevant Performance Conditions, vesting and exercise is 12,000,000 Shares. The Rights will lapse if not exercised or forfeited before the date which is 12 months from: a. the date of issue of the STI Rights; or b. the satisfaction of the Performance Condition, in the case of the LTI Rights. Once the Rights become exercisable, the Rights may be exercised at any time prior to either their lapsing or being forfeited but subject to the following restrictions on their transfer: a. 20% may be sold immediately b. 15% restricted from transfer for 3 months c. 15% restricted from transfer for 6 months and d. the balance restricted from transfer whilst Mr Mount remains the Chief Executive Officer of the Company.