SecProbe.io

CORRESP
 1
 filename1.htm

 March 21, 2025

 VIA EDGAR

 Division of Corporation Finance
 Office of Energy & Transportation
 U.S. Securities and Exchange Commission
 100 F Street, N.E.
 Washington, D.C. 20549

 Re:

 IperionX Limited

 Form 20-F for the Fiscal Year ended June 30, 2024
 Filed October 30, 2024
 File No. 001-41338

 To Whom It May Concern:

 On behalf of IperionX Limited (the “ Company ” or “ IperionX ”), this letter responds to your letter, dated February 21, 2025 (the “ Comment Letter ”), regarding the above-referenced Registration
 Statement on Form 20-F for the Fiscal Year ended June 30, 2024, filed on October 30, 2024.  Each comment of the Staff of the Division of Corporation Finance (the “ Staff ”) is set forth below, followed by the corresponding response.  For ease
 of reference, the headings and numbered paragraphs below correspond to the headings and numbered comments in the Comment Letter.  Each response of the Company is set forth in ordinary type beneath the corresponding comment of the Staff appearing in
 bold type.

 Form 20-F for the Fiscal Year ended June 30, 2024

 Business Overview, page 24
 Our Production Facilities, page 34

 1.

 We note that you included some proposed disclosures in response to prior comment one regarding government funding utilized in constructing your Titanium Production Facility (TPF) and understand that you incur
 the expenditures that are expected to be covered by the arrangement in advance of requesting and receiving the funds.

 Please further revise the disclosures that you have proposed to clarify the following with respect to costs and funding under the arrangement.

 •

 the criteria that defines permissible expenditures

 •

 the extent to which costs incurred that were funded or that are expected to be funded were capitalized or expensed in advance of requesting reimbursement

 •

 the manner of accounting for funds that are received in offsetting or reversing the entries related to your initial accounting for costs

 •

 the nature and utility of the assets acquired and their relevance to the functional processes that comprise the TPF

 •

 the amount of funds received under the arrangement each period and cumulatively

 Division of Corporation Finance
 Office of Energy & Transportation
 U.S. Securities and Exchange Commission
 March 21, 2025
 Page 2

 With regard to the fourth point above and your disclosure on page 36, stating that funds are "...being applied towards the TPF to reach its initial Phase I production capacity of 125 tpa.," it should
 be clear whether assets acquired with the funds have become integral to the operation of the facility, and if so whether there would be any practical approach to relinquishing those assets to the government without jeopardizing your ability to
 operate the TPF. Please address this uncertainty in the context of Item 3.D of Form 20-F by describing the risk of being unable to operate the TPF if you are required to return assets acquired with government funds.

 Response 1 :

 The Company proposes to add the following description of the agreement and description of the accounting treatment in its upcoming Form 20-F for the year ending June 30, 2025 . The
 added disclosure language (as compared to our response dated as of February 18, 2025) is underlined .

 Form 20-F
 Business Overview

 During fiscal 2024, the U.S. Department of Defense (“DoD”) contracted to award the Group US$12.7 million in funding under the Defense Production Act (“DPA”)
 Title III authorities to address U.S. titanium supply chain vulnerabilities. This funding is being applied towards the Group’s titanium production facility in Virginia. The agreement has an initial term of 39 months, scheduled to terminate on
 January 30, 2027, and provides that it may be extended by mutual agreement. Under the agreement, the Company and the U.S. government have agreed to use best efforts to achieve the goals of the agreement, which include the Company conducting a
 research and development program with respect to titanium technology.  The agreement provides for the U.S. government to fund up to $12.7 million and the Company to provide funding up to approximately $13.4 million during the term of the
 agreement.  The Company can acquire equipment or real property and designate the related purchase price as reflecting the government’s share of funding or the Company’s share of funding.

 Pursuant to the terms of the agreement, the cost principles applicable to the agreement are contained in 2 CFR 200, Subpart E, Cost Principles, and the
 recipient shall establish or apply cost principles or standards in accordance with 32 CFR 37.625. Under 2 CFR 200, Subpart E, Cost Principles, costs must meet the following criteria to be allowable under federal awards: (i) be necessary and
 reasonable for the performance of the award; (ii) conform to any applicable limitations or exclusion as to types and amounts; (iii) be consistent with policies and procedures that apply uniformly to both federally financed and other activities of
 the recipient; (iv) be accorded consistent treatment; (v) be determined in accordance with generally accepted accounting principles; (vi) not be included as a cost or used to meet cost sharing requirements of any federally-financed program in the
 current or prior period; (vii) be adequately documented; and (viii) in relation to administrative closeout costs, be incurred until the due date of the final report.  Additionally, the Company uses the Federal Acquisition Regulation (FAR) Part 31
 and its internal regulations entitled “Unallowable Cost Policy” to determine which costs are reimbursable.   To the extent designated as the government’s share, the Company is entitled to request reimbursement from time to time of the cost to
 purchase.

 Division of Corporation Finance
 Office of Energy & Transportation
 U.S. Securities and Exchange Commission
 March 21, 2025
 Page 3

 For accounting purposes, the Company’s role with respect to the equipment is to acquire it on behalf of the government in an agency capacity. Upon
 procurement of the asset for the government, only a receivable is recognized reflecting the reimbursement due from the government. No amounts are capitalized or expensed by the Company.

 As of June 30, 2025, the Company has procured assets on behalf of the government that cost approximately $[12.7] million for which the Company has sought
 reimbursement under the agreement.  As of June 30, 2025, the Company has received total cash reimbursements of approximately $[11.4] million for such assets, including approximately $[4.7] million in fiscal 2024 and approximately $[6.7] million
 in fiscal 2025. The remaining approximately $[1.3] million is recorded as a receivable as of June 30, 2025 which is expected to be received in subsequent fiscal years.

 Title to all equipment and real property acquired with federal funds vests with the government throughout the agreement. The government can elect to, but is
 not obliged to, transfer such title to all or a portion of the equipment or real property to the Company at the end of the agreement, which is scheduled to terminate on January 30, 2027, if the Company’s performance is satisfactory and provided
 that (a) the Company has used the equipment or real property for the authorized purposes of the project funding until funding for the project ceases, (b) the Company has not encumbered the equipment or real property without approval of the
 government, and (c) the Company has otherwise complied with the terms of the agreement. All equipment acquired with federal funds is tagged and segregated from equipment acquired with Company funds using a Property Control List that tracks all
 equipment purchased under the agreement. The Property Control List is submitted quarterly to the government and includes a description of the equipment, an asset number, manufacturer's serial number, ordered date, received date, installed date,
 location of the asset, and disposition date (if applicable). When the equipment arrives at our Virginia facility, it is tagged with an identification tag marked “Property of the Government of the United States” and which also included the serial
 number, asset number, and date received.

 Through June 30, 2025, the Company has used government funds primarily to acquire equipment used to produce titanium powder from recycled sources of scrap at the construction
 site.  The assets acquired are designed to establish, outfit and operationalize the TPF in accordance with the Statement of Work included in the DPA agreement.  Although these assets are integral to the operation of the TPF, in the scenario in
 which the U.S. government does not relinquish these assets to the Company at the end of the agreement, the Company would seek to acquire or lease such equipment from the government, replace such equipment with new equipment using the Company’s
 existing cash reserves, or consider other options. See "Item 3. Key Information – D. Risk Factors."

 Risk Factors
 Risks Related to Our Business

 Some of our assets used in the Titanium Production Facility are acquired with federal government funds. The government holds the title
 with respect to such assets.

 Division of Corporation Finance
 Office of Energy & Transportation
 U.S. Securities and Exchange Commission
 March 21, 2025
 Page 4

 Our operations, particularly the Titanium Production Facility ("TPF"), rely on federal funds for the acquisition of certain assets, including equipment and
 real property. See "Item 4. Information on the Company – B. Business Overview." Under the terms of this funding arrangement, title to all equipment and real property acquired with federal funds vests with the government. The government can elect
 to, but is not obliged to, transfer such title to all or a portion of the equipment or real property to the Company at the end of the agreement, which is scheduled to terminate on January 30, 2027, if the Company’s performance is satisfactory and
 subject to other conditions. This arrangement presents several risks to our business:

 •

 Loss of Use of Certain Assets: Because the title to these assets is held by the government, we do not have full control over them. Any changes in government policy or a decision by the government not to
 transfer title of some or all of these assets to the Company at the end of the agreement could adversely affect our operations. If the government were to exercise its rights to reclaim these assets, we might be unable to continue
 operating the TPF effectively.

 •

 Operational Disruptions: Some of the assets acquired with federal funds are integral to the operation of the TPF. If we are required to relinquish these assets to the government, it could jeopardize our
 ability to operate the facility. This could lead to operational disruptions, increased costs, and potential loss of revenue.

 •

 Dependency on Federal Funding: Our reliance on federal funds for acquiring certain assets makes us dependent on continued government support. Any reduction in federal funding or changes in the terms of
 funding could impact our ability to acquire or operate certain assets in the future, thereby affecting our operational capabilities and financial performance.

 •

 Regulatory and Compliance Risks: The use of federal funds subjects us to additional regulatory and compliance requirements. Any failure to comply with these requirements could result in penalties, loss of
 funding, or other adverse consequences that could negatively impact our business operations.

 •

 Financial Implications: Any decision by the government not to transfer title of some or all of these assets to the Company at the end of the agreement may necessitate additional expenditures to replace or
 replicate these assets, thereby increasing our capital expenditures and affecting our financial condition.

 In summary, our dependence on federal funds and the resulting government ownership of certain assets poses risks to our operations,
 financial performance, and overall business continuity.

 Division of Corporation Finance
 Office of Energy & Transportation
 U.S. Securities and Exchange Commission
 March 21, 2025
 Page 5

 Notes to Financial Statements
 Note 6. Trade and other receivables

 During fiscal 2024, the U.S. DoD contracted to award the Group US$12.7 million in funding under the DPA Title III authorities to address U.S. titanium supply
 chain vulnerabilities. This funding is being applied towards the Group’s titanium production facility in Virginia. Pursuant to the agreement, title to all assets acquired with federal funds vests with the government. The government can elect to,
 but is not obliged to, transfer such title to all (or some) of the equipment or real property to the Company at the end of the agreement, which is scheduled to terminate on January 30, 2027, if the Company’s performance is satisfactory and provided
 that the Company has otherwise complied with the terms of the agreement. Accordingly, the Company does not control the assets acquired with federal funds, even where the conditions of the agreement are complied with, and so there is no current
 government grant to be recognized. Instead, for accounting purposes, the Company’s role with respect to the equipment is to acquire it on behalf of the government in an agency capacity. Upon procurement of the asset for the government, only a
 receivable is recognized reflecting the reimbursement due from the government. If, per the agreement, the government subsequently decides to transfer title of the assets to the Company at the end of the program, this is the point at which a
 government grant would crystallize and the Company would record a non-monetary government grant in accordance with IAS 20 ‘Accounting for Government Grants and Disclosure of Government Assistance’.

 2.

 Given your disclosures indicating that the government funds received may eventually become a grant, disclose your expectations in this regard, and explain how this would be reported in your financial statements
 and how you would consider the nature of the expenditures that had been made in accounting for the event.

 With regard to your accounting policy, please clarify how the amounts expended and received each period are reflected in your financial statements (e.g. in the balance sheets, statements of
 operations, and statements of cash flows), considering that expenditures are made before you submit requests for reimbursement.

 On a related point, tell us why the increase in Trade and Other Receivables shown in Note 6 on page F-17, which includes a $1.7 million receivable related to the contract, appears as a reconciling
 item (a negative adjustment) in determining operating cash flows in Note 5. Please clarify why there would be a credit reflected in the loss, as suggested by this presentation, and provide us with a schedule of all related expenditures and funding
 that is reflected in your financial statements, including the amounts and line items in which the activity has been reported.

 Please also provide us with a schedule of the amounts ascribed to assets for which funding was received and that are no longer reported in your financial statements as of June 30, 2024, reconciled to
 the cumulative funding received at that point, and showing the amounts expended in relation to your $13.4 million commitment, along with details of how those amounts are reported in your financial statements.

 Response 2 :

 As of February 2025, we have used the funds for the purposes of the purchase, installation, and operationalization of equipment used to produce titanium powder from recycled sources of scrap at the construction site.
 We believe our activities are in accordance with the plan we provided to the government prior to the granting of the funds. Pursuant to the terms of the DPA funding arrangement, to the extent our performanc