Denison to acquire interest in claims comprising Russell Lake Uranium Project

Denison Mines (DNN) announced that it has executed an agreement with Skyharbour Resources to acquire initial interests in claims comprising Skyharbour’s Russell Lake Uranium Project, which is located directly adjacent to Denison’s flagship Wheeler River Project. The Russell property will be divided into four property joint ventures that will be known as: Russell Lake, Getty East, Wheeler North, and Wheeler River Inliers, of which Denison will acquire initial ownership interests of 20%, 30%, 49%, and 70%, respectively. In addition, Denison and Skyharbour have agreed to enter into option agreements, which will allow Denison to increase its ownership interest in each of the new Wheeler North and Getty East joint ventures to up to 70%. Under the terms of the agreement, Denison has agreed to pay Skyharbour total consideration of $18M – consisting of a $2M cash payment upon the execution of the agreement and deferred consideration of $16M, payable in cash or common shares of Denison in two tranches of $8M, before December 31. Closing of the transaction is expected to occur on or before December 21. Immediately upon execution of the agreement an upfront payment of $2M in cash will be payable to Skyharbour, with a deferred consideration of $16M payable prior to December 31. The deferred consideration will be comprised of two tranches, each of which may be paid in cash or shares at Denison’s election. This first deferred payment of $8M in cash or shares, is payable on or before the fifth business day prior to December 21. The second deferred payment of $8M in cash or shares, is payable within 10 days of December 21. The agreement grants Denison priority access to excess capacity at Skyharbour’s existing Russell exploration camp located near Highway 914 proximal to McGowan Lake, which Skyharbour will continue to operate. Denison will pay Skyharbour a usage fee as well as a 7% administrative fee to use the Camp. The transaction is subject to customary approvals, including Skyharbour obtaining TSX Venture exchange approval. The transaction will be considered a reviewable transaction under TSX Venture exchange policies as David Cates, president, CEO and director of Denison, is also a director of Skyharbour.