Eco Oro Minerals Corp. · CSE:EOM
Eco Oro Minerals — Proxy Contest (April 2017)
32 slides from Eco Oro Minerals's proxy contest presentation, Apr 4, 2017
Slide 1: A Path to Value for Angostura
Eco Oro Minerals Corp. A Path to Value for Angostura Presentation to Institutional Shareholder Services April 4, 2017
Slide 2: Forward Looking Statements
Forward Looking Statements Certain statements in this presentation are "forward-looking" within the meaning of Canadian and United States securities legislation. Forward-looking statements are generally, but not always, identified by the words "expects", "plans", "anticipates", "in the event", "if",
Slide 3: Introduction
Introduction
Slide 4: Introduction
Introduction • On April 25, 2017, Eco Oro Minerals Corp. (“Eco Oro” or the “Company”) will hold its annual general and special meeting of shareholders. • The board of directors of the Company (the “Board”) has proposed that six highly-qualified nominees be re-elected to safeguard and protect the fut
Slide 5: Angostura: Eco Oro's World-Class Multi-Million Ounce Gold Project in Colombia
Angostura: Eco Oro’s World-Class Multi-Million Ounce Gold Project in Colombia • Eco Oro’s primary focus has been the development of a world-class multi-million ounce gold project in Colombia – Angostura. • Eco Oro was one of the first foreign mining companies to invest in Colombia’s gold mining sect
Slide 6: Angostura: Eco Oro's World-Class Multi-Million Ounce Gold Project in Colombia
Angostura: Eco Oro’s World-Class Multi-Million Ounce Gold Project in Colombia • The Colombian Government made repeated assurances of support for Angostura, even declaring it to be a "project of national interest" in 2011 and again in 2013. Eco Oro itself has been lauded for its social programs and i
Slide 7: Angostura: The Path to Value
Angostura: The Path to Value • The Board and management team was, and remains, determined to preserve value for all Eco Oro shareholders. • Faced with a seemingly insurmountable challenge, Eco Oro: 1. Sought out and retained a legal team that specializes in international arbitral disputes, including
Slide 8: The Board Took Bold and Decisive Action
The Board Took Bold and Decisive Action
Slide 9: The Board Took Bold and Decisive Action to Prevent the Destruction of the Company's Equity Value
The Board Took Bold and Decisive Action to Prevent the Destruction of the Company’s Equity Value • InFebruary 2015, following actions taken by the Colombian government that adversely impacted the development of Angostura, Eco Oro was in urgent need of capital. • The Board approached several existing
Slide 10: The Board Took Bold and Decisive Action to Prevent the Destruction of the Company's Equity Value
The Board Took Bold and Decisive Action to Prevent the Destruction of the Company’s Equity Value • None of these efforts resulted in a viable financing alternative due to market conditions, onerous or unacceptable deal terms, and investor or partner concerns about investment risks associated with Co
Slide 11: The Board Took Bold and Decisive Action to Prevent the Destruction of the Company's Equity Value
The Board Took Bold and Decisive Action to Prevent the Destruction of the Company’s Equity Value • In March 2016, as a consequence of the Colombian Constitutional Court's decision of February 8, 2016, which broadened the prohibition of mining activities in páramo areas in a way that adversely affect
Slide 12: The Board Took Bold and Decisive Action to Prevent the Destruction of the Company's Equity Value
The Board Took Bold and Decisive Action to Prevent the Destruction of the Company’s Equity Value • Having exhausted traditional financing sources and after unsuccessfully approaching some of the Company’s own shareholders to help fund the Company, Eco Oro was introduced to three potential investors
Slide 13: The Value Accretive Tenor Financing
The Value Accretive Tenor Financing • Tenororiginally intended to invest US$14 million in the form of an equity interest in the Company. Because of Eco Oro’s immediate cash need, Tenor agreed to provide capital in two tranches in order to provide immediate capital to the Company, while preparing to
Slide 14: The Value Accretive Tenor Financing
The Value Accretive Tenor Financing • This transaction was executed with stock exchange approval and was in compliance with MI 61- 101 (Protection of Minority Shareholders in Special Transactions). • Both leading independent proxy advisors, Institutional Shareholder Services (“ISS”) and Glass, Lewis
Slide 15: The Value Accretive Tenor Financing
The Value Accretive Tenor Financing $90 Additional Value Creation $80 $70 $37.1 $60 Issuance of Shares Related to Partial Issuance of Shares Note Conversion $50 Market Related to July 21, Capitalization Day 2016 Financing Prior to Tenor $40 Financing $6.32 $3.91 $30 $20 $33.5 ~$47 Million in Total V
Slide 16: Board and Management Have Been Responsible Stewards of Shareholder Capital
Board and Management Have Been Responsible Stewards of Shareholder Capital • The Board and management took every opportunity to cut overhead while ensuring that the Company maintains a strong on-the-ground presence in Colombia to oversee Angostura and to keep the Company’s assets secure. • The Board
Slide 17: Debunking the Dissidents' Claims
Debunking the Dissidents’ Claims
Slide 18: The Dissident Attack
The Dissident Attack • A group of dissidents led by Courtenay Wolfe and Harrington Global Opportunities Fund Ltd. (the "Dissidents") has proposed its own slate of directors. • In contrast to the current Board, the Dissidents’ slate of nominees lacks the relevant skills and experience necessary to st
Slide 19: Debunking the Dissidents' Claims
Debunking the Dissidents’ Claims Claim #1: “Faced with the predicted inevitable liquidity crisis of its own making, the Company ignored other shareholder-friendly financing options, and agreed to [the Tenor financing].” FALSE: Since 2010, Eco Oro has had to rely on a small group of loyal shareholder
Slide 20: Debunking the Dissidents' Claims (continued)
Debunking the Dissidents’ Claims (continued) Having exhausted traditional financing sources, the Company was introduced to three potential investors (Tenor, Calunius Capital and Vannin Capital) to provide capital to prosecute the arbitration claim. After entering into discussions with each firm: • C
Slide 21: Debunking the Dissidents' Claims
Debunking the Dissidents’ Claims Claim #2: “Management and the largest shareholders agreed to support Tenor in return for a significant part of the Company being given to them for nominal consideration.” FALSE: By July of 2016, just prior to concluding the transaction with Tenor, the Company was fac
Slide 22: Debunking the Dissidents' Claims
Debunking the Dissidents’ Claims Claim #3: “The Board converted a portion of the unsecured convertible debt of the Company into common shares in order to entrench itself.” FALSE: As negotiated and understood by Eco Oro, the convertible indebtedness of the Company, or any portion thereof, may be repa
Slide 23: Debunking the Dissidents' Claims
Debunking the Dissidents’ Claims Claim #4: “Attempts to reduce costs and expenses since 2015 have been insufficient and the Company still has an excessively high burn rate…None of [Courtenay Wolfe’s] suggestions were followed.” FALSE: Eco Oro implemented a series of cost-saving measures to align the
Slide 24: Debunking the Dissidents' Claims
Debunking the Dissidents’ Claims Claim #5: “Management has further destroyed shareholder value by implementing a management incentive plan entitling certain “key personnel” to 7% of the gross proceeds of the Arbitration…The plan is highly unusual and off-market.” FALSE: Eco Oro implemented a managem
Slide 25: Debunking the Dissidents' Claims
Debunking the Dissidents’ Claims Claim #6: “A complete overhaul of leadership is required in order for Eco Oro to be in a position to realize its value for the benefit of all shareholders.” FALSE: The Dissidents have failed to articulate a credible plan for shareholders. They appear to believe that
Slide 26: Our Nominees
Our Nominees
Slide 27: Eco Oro's Board of Director Nominees Qualifications
Eco Oro’s Board of Director Nominees Qualifications Mark Anna Hubert R. Derrick H. Kevin Moseley- David Kay Stylianides Marleau Weyrauch O’Halloran Williams Experience with International Arbitration ✅ ✅ ✅ ✅ ✅ ✅ Track Record of Value Creation ✅ ✅ ✅ ✅ ✅ ✅ History of Good Business Judgement ✅ ✅ ✅ ✅ ✅ ✅
Slide 28: Eco Oro's Board of Director Nominees
Eco Oro’s Board of Director Nominees Anna Stylianides – Executive Chairman, Director Ms. Stylianides has 20 years of experience in the global capital markets having spent much of her career in investment banking, private equity, and corporate management and restructuring. She began her career in cor
Slide 29: Eco Oro's Board of Director Nominees
Eco Oro’s Board of Director Nominees Derrick H. Weyrauch – Director Mr. Derrick H. Weyrauch, CPA, CA has over 25 years of experience that includes corporate financial management, financings, strategic planning and merger & acquisition transactions. He has extensive senior management experience inclu
Slide 30: Conclusion
Conclusion The Dissidents’ claims are baseless. They offer no credible plan or path to maximizing shareholder value. The Board and management team of Eco Oro: 1. Took direct steps that helped increase the price of Eco Oro’s stock by 197% and increase the market capitalization of the Company by appro
Slide 31: Vote Your GREEN Proxy Today
Vote Your GREEN Proxy Today Shareholders Media Only North American Toll Free Riyaz Lalani Number: 1-800-240-2133 rlalani@bayfieldstrategy.com Outside North America, Banks, Nicole Sale Brokers and Collect Calls: nsale@bayfieldstrategy.com 1-201-806-7301 Email: inquiries@dfking.com 31
Slide 32: Notes
Notes 1. Shares closed at $0.35 on July 21, 2016, day prior to announcement of financing, from Trexs Investments, LLC, with 95.6mm shares outstanding; shares closed at $0.69 on March 24, 2017, with 117.1mm shares outstanding. 2. Brilliant Resources Inc. Management Information Circular, dated May 25,