Robert Kennedy has been defeated in a board challenge by dissident shareholders who sought to unseat the prominent Adelaide company director as chairman of Marmota Energy.

Kennedy resigned last night ahead of a crucial vote at a Marmota general meeting today brought on by Dr Colin Rose, the largest shareholder in the SA uranium and metals explorer.

“Corporate democracy has spoken and I wish the company all the best in the future,” Kennedy told InDaily today.

Marmota shareholders approved an appointment of Rose to the board and another resolution to approve an issue of up to 50 million shares to raise capital.

The meeting today elected Rose as a director by a considerable margin, with 90 million shares voted in his favour and 40 million against.

In the board meeting that followed the general meeting, Rose was appointed chairman of Marmota.

Rose said he would be looking to make changes in the way the company was run.

Marmota advised the ASX last evening that Kennedy, who had been chairman since Marmota was floated in 2007, had resigned with immediate effect.

“Mr Kennedy was instrumental in the creation of the company and driving it forward over that time,” Marmota’s statement said.

“The company wishes to express its thanks to Mr Kennedy for his contribution to the company over that time,” it said.

One of Rose’s key concerns which led to his board challenge was that the cash position of Marmota was deteriorating and the level of the company’s exploration activity declining.

“If you go back about three years the company had about $3 million in cash in the kitty; in the last year that has dwindled downwards to the point where at the end of the current quarter there will be about $500,000 left in reserves,” Rose told InDaily in early April after formally requisitioning today’s meeting.

“Most of that money has been spent on essentially directors’ fees and administration. In the last year there has been almost no drilling.

“The company is not without prospects but … if we didn’t act now, by the time it came to the next annual general meeting (in late 2015) the company’s cash position would be down to zero.

“Companies that have cash positions down to zero are left like stranded whales – they can’t raise capital, they can’t drill, they just get stuck.”

Kennedy rejected Rose’s assertion at that time, claiming Marmota had spent $1.4 million on exploration in 2014.

“Whilst expenditure on exploration has reduced it is due to the lack of available capital consistent with the change in the market due to the decline of commodity prices,” Kennedy told InDaily last month.

“However, the company continues to explore within the available funds.”

Yesterday, Marmota advised in its quarterly report to the ASX that the company had $426,000 in cash at 31 March, down from $959,296 at the end of 2014 and down from $2.5 million at 31 December 2013.

The quarterly report added: “The board is concerned that it has not been able to raise further capital in a timely fashion, particularly in these times of difficult capital markets.”

“It is important that the company addresses raising additional capital as a matter of urgency in order to be able to continue its current operations,” the quarterly report says.

Marmota’s shares last traded at 1.3 cents a share.