"Hardy's subsidiary Air Tiwi have an AOC"
Mmmmm don't think so.
So Air Tiwi does not have an AOC therefore no CP.
So if the CP and deputy CP fail a renewal it only affects the Air Tiwi operation
That statement does not compute.
The AOC holder is required to have a CP who has endorsements and ratings consistent to the operation, unless approved otherwise by CASA (CAO 82.3.23). So if the CP cannot carryout the duties required by the position and the company's operation, then the AOC holder cannot operate.