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Entrée Resources Closes Over-Subscribed $4.4 Million Financing

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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.

SOURCE Entrée Resources

For further information: David Jan, Investor Relations, Entrée Resources Ltd., Tel: 604-687-4777. Toll Free: 1-866-368-7330, E-mail: [email protected]

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Many small companies can borrow without Main Street

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WASHINGTON — Federal Reserve Chair Jerome Powell says that many mid-size U.S. businesses are now able to borrow from banks, suggesting that the need for a Fed lending program that was designed to serve struggling medium-size companies has waned.

In remarks prepared for delivery Tuesday to the House Financial Services Committee, Powell said there are 230 loans, accounting for a total of about $2 billion, that have been provided or are in the pipeline under the Fed’s Main Street Lending Program. Powell’s testimony was released Monday by the Fed.

Still, that sum is far short of the $600 billion that the Fed had initially set aside for the Main Street program. The Treasury Department and the Fed allocated $75 billion from congressionally approved taxpayer funds to support the Main Street program; any losses up to that amount would be covered by Treasury.

“Main Street loans may not be the right solution for some businesses, in part because…these loans cannot be forgiven,” Powell said. “The evidence suggests that most creditworthy small and medium-sized businesses can currently get loans from private-sector financial institutions.”

The Fed chair has said that Main Street was intended to help companies that were too large for the Paycheck Protection Program, which provided forgivable loans to small companies, and too small for the Fed’s corporate bond purchases, which are intended for businesses large enough to issue their own bonds.

The central bank has faced criticism for not making the Main Street program easier to use for banks, which evaluate and issue the loans. The Fed buys 95% of the loan from the banks, reducing their credit risk.

On Tuesday, Powell will testify to the House committee along with Treasury Secretary Steven Mnuchin in a hearing focused on the implementation by the Fed and Treasury of emergency programs that Congress established in its $2 trillion relief package approved in March.

Christopher Rugaber, The Associated Press

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Stocks sink as September gloom continues

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Stocks sank Monday, following global equities lower and setting the three major indices up to extend last week’s sharp declines. The extended drop came as concerns over stagnating coronavirus case improvement stoked fears of more lockdowns, and as political uncertainty nudged investors away from risk assets.

The Dow fell more than 700 points, or 2.7%, just after noon on Monday, adding to a cumulative more than 350-point slide in the index from Thursday to Friday last week. The S&P 500 dropped more than 2% after ending last week at its lowest level in six weeks last week. As of Friday’s closing level, the S&P 500 was down more than 7% from its recent record high from Sept. 2, and was on track to log a four-session losing streak, or its longest since February.

“So far, the market has over-shot our expectations for a 4% to 6% haircut from recent highs on near-term extended valuations, as well as economic and Covid-19 risks. That said, the declines through last Friday are not all that surprising,” John Stoltzfus, chief investment strategist for Oppenheimer Asset Management, said in a note Monday. “It is that September — traditionally but not always — can be tough month for stocks. The S&P 500 had delivered a massive rally rising 60% from the lows on March 23 through September 2. Markets tend to overshoot to the upside as well as to the downside.”

Other analysts pointed to developments – and in some cases, a lack of progress – in Washington, D.C. as contributors to the pullback.

“The root causes of the recent drawdown in US large caps are [first], recent weakness in real-time economic indicators, [second] the lack of movement on a fiscal stimulus package that could offset #1 and [third] the Fed’s lackluster forecasts in its Wednesday release of the Summary of Economic Projections,” Nicholas Colas, Co-founder of DataTrek Research, wrote in a note Monday morning.

Shares of major bank stocks including JPMorgan Chase (JPM), HSBC (HSBC) and Deutsche Bank (DB) slid following a report that they and other financial institutions for decades facilitated fund transactions used for allegedly criminal activities, and failed to report suspicious activity.

Meanwhile, heavily weighted big tech stocks extended the past several weeks’ worth of declines, with Apple (AAPL), Facebook (FB), Amazon (AMZN) and Microsoft (MSFT) shares each lower in intraday trading. Oracle (ORCL) was the exception among tech names, after the company announced Friday that it was chosen to become TikTok’s “secure cloud technology provider,” and in doing so take a 12.5% stake in the social media service. Shares rose more than 1%.

So-called “reopening stocks” also renewed their declines, as fears over coronavirus cases both in the US and abroad led to jitters over a second wave of the pandemic and more business re-closures. Covid-related deaths in the US neared 200,000, and new cases have risen significantly in Arkansas, Colorado, Idaho, Montana, Nebraska and North Dakota over the past week. Former FDA Commissioner Scott Gottlieb told CBS’s “Face the Nation” on Sunday that he thinks “we have at least one more cycle with this virus heading into the fall and winter.” In Europe, countries including France and Germany have been grappling with marches higher in daily cases, and the World Health Organization warned last week of a “very serious situation unfolding” in Europe over the virus.

Cruise stock Royal Caribbean Group (RCL) fell more than 7% in intraday trading, and airlines including United Airlines (UAL), Southwest (LUV) and Delta (DAL) were each down at least 6%.

12:04 p.m. ET: US household net worth rose by a record $7.6 trillion in Q2 after stimulus boost

The Federal Reserve said Monday that US household net worth surged by a record $7.6 trillion in the second quarter this year, following an influx of coronavirus-related government stimulus payments and run-up in the stock market. The increase brought household wealth to $118.9 trillion by the end of quarter ended in June.

10:26 a.m. ET: Stocks extend declines, Dow drops 700+ points

The three major indices extended declines Monday morning, adding to the last three weeks’ worth of drops. The Dow sank further, dropping more than 750 points, or 2.7%, to well below 27,000.

The S&P 500 also slid more than 2%, with the energy, materials and industrials sectors leading the declines.

Overseas equities also slumped. Germany’s DAX (^GDAXI) index slid 4.5% for its biggest drop since March.

9:33 a.m. ET: Stocks open sharply lower, Dow sheds 400+ points

Here were the main moves in markets as of 9:33 a.m. ET:

  • S&P 500 (^GSPC): -51.81 points (-1.56%) to 3,267.66

  • Dow (^DJI): -502.67 points (-1.82%) to 27,154.75

  • Nasdaq (^IXIC): -153.07 points (-1.37%) to 10,638.94

  • Crude (CL=F): -$0.97 (-2.36%) to $40.14 a barrel

  • Gold (GC=F): -$42.70 (-2.18%) to $1,919.40 per ounce

  • 10-year Treasury (^TNX): -3.3 bps to yield 0.661%

7:45 a.m. ET: Nikola shares plummet after founder Trevor Milton resigns as executive chairman

Shares of newly public electric truck-maker Nikola (NKLA) slumped in early trading after its executive chairman and founder Trevor Milton unexpectedly announced his resignation, after a short-seller released a scathing report alleging Milton had for years deceived investors about the company.

“I asked the Board of Directors to let me step aside from my roles as Executive Chairman and a member of Nikola Board of Directors. The focus should be on the Company and its world-changing mission, not me. I intend to defend myself against false allegations leveled against me by outside detractors,” Milton wrote in a statement posted on his Twitter account at 2:21 a.m. ET Monday morning. 

Nikola’s stock, which had risen to as high as $50.05 per share after announcing a partnership with General Motors (GM) earlier this month, saw shares slide to below $24 per share in early trading. GM shares were off 3.8% in pre-market trading.

7:36 a.m. ET Monday: Stock futures sell off in early trading

Here were the main moves in equity markets, as of 7:36 a.m. ET Monday:

  • S&P 500 futures (ES=F): 3,257.25, down 59 points or 1.78%

  • Dow futures (YM=F): 27,041.00, down 561 points or 2.03%

  • Nasdaq futures (NQ=F): 10,729.00, down 198 points, or 1.81%

  • Crude (CL=F): $40.32 per barrel, -$0.79 (-1.92%)

  • Gold (GC=F): $1,936.90, -$25.20 (-1.28%)

  • 10-year Treasury (^TNX): yielding 0.663%, or down 3.1 bps

NEW YORK, NEW YORK – MARCH 20: Traders work on the floor of the New York Stock Exchange (NYSE) on March 20, 2020 in New York City. Trading on the floor will temporarily become fully electronic starting on Monday to protect employees from spreading the coronavirus. The Dow fell over 500 points on Friday as investors continue to show concerns over COVID-19. (Photo by Spencer Platt/Getty Images)

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S. African Stocks at Three-Month Low as Risk Sentiment Sours

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(Bloomberg) — South Africa’s main stock benchmark drops as much as 2.9% to the lowest June 17 as rising virus cases hammer risk sentiment, dragging global markets lower.

“Investors are becoming increasingly worried about the momentum in the economic recovery given the resurgent numbers of global Covid-19 cases and lack of progress on a new U.S. stimulus package,” Hussein Sayed, chief market strategist at FXTM, said in an emailed note.

Monday’s weakness extends the FTSE/JSE Africa All Shares Index’s slide to a fifth consecutive day, the longest losing streak since May 2019. Some 121 of the 142 index members were trading lower at 1 p.m. local time.

Market behemoth Naspers Ltd. drops for a fourth session, down 1.9%, as partly owned Tencent Holdings Ltd. declines in Hong Kong. Naspers holds a 31% stake in Tencent.Gauge for mining stocks drops 1.6%.BHP -2.3%, Anglo American -3.1%, Sibanye Stillwater Ltd. -4.3%, Impala Platinum Holdings Ltd. -4.9%, Anglo American Platinum Ltd. -4.7%, Northam Platinum Ltd. -3%, Glencore Plc -4%.Sub-index for gold miners extends losing streak to a fourth day, down 2.9% to the lowest since July 7, as bullion prices retreat ahead of comments from Federal Reserve Chair Jerome Powell and insight from the mining industry at a conference this week.NOTE: PRECIOUS: Gold Declines as Powell’s Testimony and Forum in FocusGold Fields Ltd. -4%, AngloGold Ashanti Ltd. -1.7%, Harmony Gold Mining Co. Ltd. -2.8%, Pan African Resources Plc -3.9%, DRDGold Ltd. -3.2%.Index for bank stocks drops for a third day, down 3%, as the rand erases earlier gains and drops 1.8%.Standard Bank Group Ltd. -3.6%, FirstRand Ltd. -2.1%, Absa Group Ltd. -3.8%, Capitec Bank Holdings Ltd. -2.7%, Nedbank Group Ltd. -4.7%, Investec Plc -3.6%.Weak currency drags index for food and drug sellers down 3.4%, while general retailers fall 3.5%.Bid Corp Ltd. -4.8%, Shoprite Holdings Ltd. -2.2%, Clicks Group Ltd. -2.6%, Spar Group Ltd. -3.4%, Pick n Pay Stores Ltd. -2.9%, Dis-Chem Pharmacies Ltd. -3.3%.Woolworths Holdings Ltd. -6.3%, Mr Price Group Ltd. -3.4%, Truworths International Ltd. -6.5%, Foschini Group Ltd. -1.8%, Pepkor Holdings Ltd. -2.7%, Massmart Holdings Ltd. -4.1%.Foreigners were net sellers of South African stocks, disposing 815 million rand worth of shares Friday, according to index operator, JSE Ltd.

(Updates report with latest share prices)

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