Eco Oro Minerals Corp. is facing opposition to the second tranche of a US$14 million financing and believes it is unlikely to get the nod from shareholders at an Oct. 13 special meeting.
The Toronto-based explorer said Oct. 3 that a group of concerned shareholders that collectively holds about 39.22% of the shares entitled to vote at the meeting have told Eco Oro they will vote against the proposed financing.
Eco Oro entered into a two-stage investment agreement with Trexs Investment LLC in late July, which resulted in an initial US$3 million capital injection and was to be followed up with an US$11 million investment that would see Trexs take a 49.99% stake in the company.
The disgruntled shareholders believe the company has acted unfairly in allowing certain insiders and other key shareholders to participate in the proposed financing.
They are also arguing that they are being forced to vote in favor of the placement, with the threat of "onerous terms and conditions" to be imposed on them if they do not approve the second tranche financing.
The group has turned to Canadian regulators, including the British Columbia Securities Commission, asking them to intervene in the matter.