VANCOUVER, BC, Sept. 14, 2020 /CNW/ - Entrée Resources Ltd.
(TSX: ETG) (OTCQB: ERLFF) (the "Company" or
"Entrée") is pleased to announce that it has closed the
non-brokered private placement announced on August 20, 2020 (the
"Financing").
The Company has issued 10,278,000 units at a price of
C$0.43 per unit for gross proceeds of
C$4,419,540.
Each unit (a "Unit") consists of one common share of the
Company and one-half of one transferable common share purchase
warrant (each whole warrant, a "Warrant"). Each Warrant will
entitle the holder to acquire one additional common share of the
Company (a "Warrant Share") at a price of C$0.60 per share for a period of 3 years. The
securities issued in connection with the Financing are subject to a
hold period expiring January 15,
2021. In connection with the Financing, the Company paid a
finder's fee of C$86,000 in cash,
equal to 5% of aggregate gross subscription proceeds received by
the Company from purchasers introduced to the Company by the
finder.
Net proceeds from the Financing are expected to be used to
update the National Instrument 43-101 Technical Report on the
Company's interest in the Entrée/Oyu Tolgoi joint venture property
in Mongolia (the "Entrée/Oyu
Tolgoi JV Property"), and for general corporate purposes.
Stephen Scott, President and CEO
commented, "We are very pleased that we had such high demand for
the Entrée financing at this time of great uncertainty particularly
as the overwhelming majority of subscribers were existing
shareholders. Capital is not always available to the junior
mining sector and seizing the opportunity now has put Entrée in a
very strong financial position as development of the Oyu Tolgoi
underground project moves towards sustained production."
Insiders of the Company acquired an aggregate 4.437 million
Units, including 2,400,000 Units acquired by Sandstorm Gold Ltd.
("Sandstorm Gold"), 875,000 Units acquired by Rio Tinto
International Holdings Limited ("Rio Tinto") and 740,000
Units acquired by Turquoise Hill Resources Ltd. ("Turquoise
Hill"). Following closing, Sandstorm Gold holds 39,790,880
common shares of the Company, or 21.4% of the Company's issued and
outstanding shares, Rio Tinto holds 17,441,796 common shares of the
Company, or 9.4% of the Company's issued and outstanding shares and
Turquoise Hill holds 14,539,333 common shares of the Company, or
7.8% of the Company's issued and outstanding shares.
Directors and officers of the Company and their associates acquired
an aggregate 422,000 Units on the same terms and conditions as
other subscribers.
Stephen Scott added, "We greatly
appreciate the ongoing support of all of our shareholders and are
particularly pleased that our three largest strategic shareholders
participated in the financing at approximately existing
proportional levels."
The insiders' participation is exempt from the formal valuation
and shareholder approval requirements provided under Multilateral
Instrument 61-101 – Protection of Minority Holders in Special
Transactions. The exemption is based on the fact that the
market value of the insiders' participation or the consideration
paid by such insiders does not exceed 25% of the market value of
the Company.
The Company will be filing a material change report in
connection with the transaction less than 21 days before the
expected date of the closing of the transaction, and considers the
shorter period to be reasonable given the nature of the transaction
and the fact that all necessary approvals have been obtained.
The Units and Warrant Shares have not been, and will not be
registered under the United States Securities Act of 1933, as
amended, or state securities laws and may not be offered or sold
within the United States or to, or
for the account or benefit of, U.S. persons absent U.S. federal and
state registration or an applicable exemption from the U.S.
registration requirements. This news release does not constitute an
offer to sell or a solicitation of an offer to buy any of the
securities in the United
States.
ABOUT ENTRÉE RESOURCES LTD.
Entrée Resources Ltd. is
a Canadian mining company with a unique carried joint venture
interest on a significant portion of one of the world's largest
copper-gold projects – the Oyu Tolgoi project in Mongolia.
Entrée has a 20% or 30% carried participating interest in the
Entrée/Oyu Tolgoi JV Property, depending on the depth of
mineralization. Sandstorm Gold, Rio Tinto and Turquoise Hill are
major shareholders of Entrée, holding approximately 21%, 9% and 8%
of the shares of the Company, respectively. More information
about Entrée can be found at www.EntreeResourcesLtd.com.
This News Release contains forward-looking statements within
the meaning of the United States Private Securities Litigation
Reform Act of 1995 and forward-looking information within the
meaning of applicable Canadian securities laws with
respect to the Financing; anticipated use of proceeds;
the potential filing of an updated Technical Report on the
Company's interest in the Entrée/Oyu Tolgoi JV
Property; corporate strategies and plans; and other
matters that may occur in the future.
In certain cases, forward-looking statements and information
can be identified by words such as "plans", "expects" or "does not
expect", "is expected", "budgeted", "scheduled", "estimates",
"forecasts", "intends", "anticipates", or "does not anticipate" or
"believes" or variations of such words and phrases or statements
that certain actions, events or results "may", "could", "would",
"might", "will be taken", "occur" or "be achieved". While the
Company has based these forward-looking statements on its
expectations about future events as at the date that such
statements were prepared, the statements are not a guarantee of
Entrée's future performance and are based on numerous assumptions
regarding present and future business strategies; the correct
interpretation of agreements, laws and regulations; local and
global economic conditions and negotiations and the environment in
which Entrée will operate in the future, including commodity
prices, projected grades, projected dilution, anticipated capital
and operating costs, anticipated future production and cash flows;
the anticipated location of certain infrastructure and sequence of
mining within and across panel boundaries; the construction and
continued development of the Oyu Tolgoi underground mine; and the
status of Entrée's relationship and interaction with the Government
of Mongolia, Oyu Tolgoi LLC
("OTLLC"), Rio Tinto and Turquoise Hill. With respect to the
construction and continued development of the Oyu Tolgoi
underground mine, important risks, uncertainties and factors which
could cause actual results to differ materially from future results
expressed or implied by such forward-looking statements and
information include, amongst others, the timing and cost of the
construction and expansion of mining and processing facilities; the
timing and availability of a long term domestic power source for
Oyu Tolgoi (or the availability of financing for OTLLC or the
Government of Mongolia to
construct such a source); the potential impact of COVID-19; the
ability of OTLLC to secure and draw down on the supplemental debt
under the Oyu Tolgoi project finance facility and the availability
of additional financing on terms reasonably acceptable to OTLLC,
Turquoise Hill and Rio Tinto to further develop Oyu Tolgoi; the
impact of changes in, changes in interpretation to or changes in
enforcement of, laws, regulations and government practises in
Mongolia; delays, and the costs
which would result from delays, in the development of the
underground mine; the status of the relationship and interaction
between OTLLC, Rio Tinto and Turquoise Hill with the Government of
Mongolia on the continued
operation and development of Oyu Tolgoi and OTLLC internal
governance; the anticipated location of certain infrastructure and
sequence of mining; projected copper, gold and silver prices and
their market demand; and production estimates and the anticipated
yearly production of copper, gold and silver at the Oyu Tolgoi
underground mine.
Other risks, uncertainties and factors which could cause
actual results, performance or achievements of Entrée to differ
materially from future results, performance or achievements
expressed or implied by forward-looking statements and information
include, amongst others, unanticipated costs, expenses or
liabilities; discrepancies between actual and estimated production,
mineral reserves and resources and metallurgical recoveries;
development plans for processing resources; the outcome of the
definitive estimate review; matters relating to proposed
exploration or expansion; mining operational and development risks,
including geotechnical risks and ground conditions; regulatory
restrictions (including environmental regulatory restrictions and
liability); risks related to international operations, including
legal and political risk in Mongolia; risks associated with changes in the
attitudes of governments to foreign investment; risks associated
with the conduct of joint ventures; risks related to the potential
impact of global or national health concerns, including the
COVID-19 (coronavirus) pandemic; inability to upgrade Inferred
mineral resources to Indicated or Measured mineral resources;
inability to convert mineral resources to mineral reserves;
conclusions of economic evaluations; fluctuations in commodity
prices and demand; changing foreign exchange rates; the speculative
nature of mineral exploration; the global economic climate;
dilution; share price volatility; activities, actions or
assessments by Rio Tinto, Turquoise Hill or OTLLC and by government
authorities including the Government of Mongolia; the availability of funding on
reasonable terms; the impact of changes in interpretation to or
changes in enforcement of laws, regulations and government
practices, including laws, regulations and government practices
with respect to mining, foreign investment, royalties and taxation;
the terms and timing of obtaining necessary environmental and other
government approvals, consents and permits; the availability and
cost of necessary items such as water, skilled labour,
transportation and appropriate smelting and refining arrangements;
unanticipated reclamation expenses; changes to assumptions as to
the availability of electrical power, and the power rates used in
operating cost estimates and financial analyses; changes to
assumptions as to salvage values; ability to maintain the social
licence to operate; accidents, labour disputes and other risks of
the mining industry; global climate change; title disputes;
limitations on insurance coverage; competition; loss of key
employees; cyber security incidents; misjudgements in the course of
preparing forward-looking statements; as well as those
factors discussed in the Company's most recently filed
MD&A and in the Company's Annual Information Form for the
financial year ended December 31,
2019, dated March 13, 2020
filed with the Canadian Securities Administrators and available at
www.sedar.com. Although the Company has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on
forward-looking statements. The Company is under no obligation to
update or alter any forward-looking statements except as required
under applicable securities laws.
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SOURCE Entrée Resources