Eco Oro Minerals Secures $4 Million USD Loan to Fund Revised Settlement to End Shareholder Litigation
Vancouver-based mining company Eco Oro Minerals Corp. has made changes to its previously announced settlement agreement with several large shareholders and taken out a $4 million USD to fund agreement.
The alterations are being made to an agreement originally announced on August 1 to resolve litigation with Trexs Investments, LLC and a shareholder group consisting of Courtenay Wolfe, Harrington Global Opportunities Fund, and Harrington Global Limited.
The changes, according to the company, are being made to the terms involving Eco Oro convertible unsecured notes and the makeup of the board. “The company will not be proceeding with the previously proposed amendment of its convertible unsecured notes,” said the company in a statement. “Also, the current composition of the board is contingent on the board (including David Kay and Anna Stylianides) approving a financing for no more than $6.5 million USD by November 30, 2017 in order to enable the company to meet its working capital needs.”
Eco Oro added that, once implemented, the settlement agreement “will resolve all outstanding litigation relating to the board’s composition, investments by certain of the company’s shareholders, and the 2017 meeting.”
The term of the $4 million USD loan is for 150 days with a 5% interest rate, according to the company. It was approved by each of the independent directors of the board.
The company has also pushed back its annual meeting, which will now take place on October 10 at 10:00 am in Toronto at the at the offices of Norton Rose Fulbright Canada LLP. It was originally slated for September 26.
“The board of directors has determined that it is in the best interests of the company to reschedule the 2017 meeting,” said Eco Oro in statement, citing changes to the settlement agreement as a cause.
One of Eco Oro’s largest holdings is the Angostura gold and silver deposit in northeastern Colombia, which the company’s assessment has found to contain more than three million ounces of gold. Eco Oro is currently in dispute with the government of Colombia related to the free-trade agreement between Canada and Colombia, according to the company.