TORONTO, Oct. 7, 2024
/PRNewswire/ - Denison Mines Corp. ("Denison" or
the "Company") (TSX: DML) (NYSE American: DNN) announces
that it has filed an early warning report, under National
Instrument 62-103, in respect of its holdings in Foremost Clean
Energy Ltd. ("Foremost") (NASDAQ: FMST) (CSE: FAT). On
October 4, 2024, Denison acquired an
aggregate of 1,369,810 common shares of Foremost (the
"Foremost Shares") pursuant to the option agreement dated
September 23, 2024 (the "Option
Agreement"), as consideration for Foremost's acquisition of an
initial 20% of Denison's interest in 10 uranium exploration
properties (the "Share Issuance"). View PDF version
Prior to the Share Issuance, Denison held no Foremost Shares.
Immediately after giving effect to the Share Issuance, Denison
had beneficial ownership of, or control and direction over,
1,369,810 Foremost Shares, representing approximately 19.95% of the
issued and outstanding common shares of Foremost as of the date
hereof.
Option Agreement
The Option Agreement provides Foremost with the option to
acquire up to 70% of Denison's interest in 10 exploration
properties (the "Exploration Properties") over three earn-in
phases (collectively, the "Transaction"). Denison and
Foremost have also entered into an investor rights agreement (the
"Investor Rights Agreement") providing for, among other
things an increase to the size of the Foremost board of directors
(the "Foremost Board") and the nomination by Denison of up to two
individuals for election to the Foremost Board. The key
financial terms of the Transaction are outlined below.
|
Option
Phase
|
Portion of
Denison's
Interest Earned in
Exploration Properties(1)
|
Cash or Stock
Payment to
Denison(2)
|
Foremost
Funded
Exploration Expenditures
|
|
1
|
20% (to total of
20%)
|
$5,876,000(3)
|
Nil
|
|
2
|
31% (to total of
51%)(4)
|
$2,000,000
|
$8,000,000 over 36
months
|
|
3
|
19% (to total of
~70%)(5)
|
$2,500,000
|
$12,000,000 over 36
months
|
|
(1)
|
Under the terms of
the Option Agreement, Foremost may acquire up to 70% of Denison's
interest in the Exploration Properties. In the case of
Hatchet Lake, which is subject to an existing joint venture
arrangement with a third party, Foremost may acquire up to a 51%
interest in the Hatchet Lake joint venture, representing slightly
over 70% of Denison's current ownership interest.
|
|
(2)
|
For the cash or
stock payments due to Denison for Phase 2 or Phase 3, the payment
may be made in the form of cash or Foremost Shares, at the
discretion of Foremost.
|
|
(3)
|
Foremost issued
1,369,810 common shares to Denison on October 4, 2024.
Foremost's closing share price on the Canadian Securities Exchange
on September 23, 2024 was $4.29, representing a total value of the
issued shares of approximately $5,876,000. Prior to the Transaction
Denison owned nil common shares of Foremost.
|
|
(4)
|
Cash or stock
payment to Denison, and Foremost funded exploration expenditures to
be completed within 36 months of the completion of Phase 1 of the
Option Agreement. If the conditions of Phase 2 are not satisfied,
Foremost shall forfeit the entirety of its interests in and rights
to the Exploration Properties.
|
|
(5)
|
Cash or stock
payment to Denison, and Foremost funded exploration expenditures to
be completed within 36 months of the completion of Phase 2 of the
Option Agreement. If the conditions of Phase 3 are not satisfied,
Foremost shall forfeit a portion of its interests in and rights to
the Exploration Properties such that Denison's interests in each of
the Exploration Properties will be increased to 51% and
operatorship shall revert to Denison.
|
Completion of Phase 1
On October 4, 2024, Foremost
complied with the necessary conditions to complete the first option
phase, thus acquiring an initial 20% of Denison's interest in the
Exploration Properties. In addition to the issuance of 1,369,810
common shares of Foremost, all necessary conditions have been
satisfied, including:
- Appointment of David Cates, President and CEO of Denison,
to Foremost's board of directors;
- Appointment of Andy Yackulic, Vice President of
Exploration of Denison, as Technical Advisor to Foremost; and
- Execution of the Investor Rights Agreement with Denison, which
includes a pre-emptive equity participation right to invest in
Foremost's common shares to hold up to 19.95% of Foremost's issued
and outstanding common shares.
Additional Information
The Foremost Shares were acquired by Denison for investment
purposes. The Company intends to review, on a continuous basis,
various factors related to its investment in Foremost, and may
decide to acquire or dispose of additional securities of Foremost
as future circumstances may dictate, including under its
pre-emptive rights under the Investor Rights Agreement.
Further information regarding the Transaction is available in
the Early Warning Report filed under Foremost's profile on SEDAR+
at www.sedarplus.ca.
About Denison
Denison is a uranium mining, exploration and development
company with interests focused in the Athabasca Basin region of northern
Saskatchewan, Canada. The
Company has an effective 95% interest in its flagship Wheeler River
Uranium Project, which is the largest undeveloped uranium project
in the infrastructure rich eastern portion of the Athabasca Basin region of northern
Saskatchewan. In mid-2023,
a feasibility study was completed for the Phoenix deposit as an in-situ recovery ("ISR")
mining operation, and an update to the previously prepared 2018
Pre-Feasibility Study was completed for Wheeler River's Gryphon
deposit as a conventional underground mining operation. Based on
the respective studies, both deposits have the potential to be
competitive with the lowest cost uranium mining operations in the
world. Permitting efforts for the planned Phoenix ISR operation
commenced in 2019 and have advanced significantly, with licensing
in progress and a draft Environmental Impact Statement submitted
for regulatory and public review in October
2022.
Denison's interests in Saskatchewan also include a 22.5% ownership
interest in the McClean Lake Joint Venture ("MLJV"), which includes
unmined uranium deposits (planned for extraction via the MLJV's
SABRE mining method starting in 2025) and the McClean Lake uranium
mill (currently utilizing a portion of its licensed capacity to
process the ore from the Cigar Lake mine under a toll milling
agreement), plus a 25.17% interest in the MWJV's Midwest Main and
Midwest A deposits, and a 69.44% interest in the Tthe Heldeth Túé
("THT") and Huskie deposits on the Waterbury Lake Property. The
Midwest Main, Midwest A, THT and Huskie deposits are located within
20 kilometres of the McClean Lake mill. Taken together, Denison has
direct ownership interests in properties covering ~384,000 hectares
in the Athabasca Basin
region.
Additionally, through its 50% ownership of JCU (Canada) Exploration Company, Limited ("JCU"),
Denison holds additional interests in various uranium project joint
ventures in Canada, including the
Millennium project (JCU, 30.099%), the Kiggavik project (JCU,
33.8118%), and Christie Lake (JCU,
34.4508%).
In 2024, Denison is celebrating its 70th year in uranium
mining, exploration, and development, which began in 1954 with
Denison's first acquisition of mining claims in the Elliot Lake region of northern Ontario.
Follow Denison on X (formerly Twitter)
@DenisonMinesCo
About Foremost
Foremost Clean Energy (NASDAQ: FMST) (CSE: FAT) (WKN: A3DCC8)
is an emerging North American uranium and lithium exploration
company with an option to earn up to 70% interest in 10 prospective
uranium properties spanning over 330,000 acres in the prolific,
uranium-rich Athabasca Basin. As the demand for carbon-free
energy continues to accelerate, domestically mined uranium and
lithium are poised for dynamic growth, playing an important role in
the clean energy mix of the future.
Foremost's uranium projects are at different stages of
exploration, from grassroots to those with significant historical
exploration and drill-ready targets. Its mission is to create
significant discoveries, alongside and in collaboration with
Denison, through systematic and disciplined exploration
programs.
For further information please visit the company's website
at www.foremostcleanenergy.com or contact Foremost at
250 – 750 West Pender Street, Vancouver,
British Columbia V6C 2T7.
Cautionary Statement Regarding Forward-Looking
Statements
Certain information contained in this news release
constitutes 'forward-looking information', within the meaning of
the applicable United States and
Canadian legislation, concerning the business, operations and
financial performance and condition of Denison. Generally,
these forward-looking statements can be identified by the use of
forward-looking terminology such as 'potential', 'plans',
'expects', 'budget', 'scheduled', 'estimates', 'forecasts',
'intends', 'anticipates', or 'believes', or the negatives and/or
variations of such words and phrases, or state that certain
actions, events or results 'may', 'could', 'would', 'might' or
'will' 'be taken', 'occur' or 'be
achieved'.
In particular, this news release contains forward-looking
information pertaining to Denison's current intentions and
objectives with respect to, and commitments set forth in, the
Option Agreement and ancillary agreements and the expected
benefits thereof; the
assumption that the transactions set forth in the Option
Agreement will be completed as described; the Company's
exploration, development and expansion plans and
objectives for the Exploration Properties and other Company
projects; and expectations regarding its joint venture
ownership interests and the continuity of its agreements with its
partners and third parties.
Forward looking statements are based on the opinions and
estimates of management as of the date such statements are made,
and they are subject to known and unknown risks, uncertainties and
other factors that may cause the actual results, level of activity,
performance or achievements of Denison to be materially different
from those expressed or implied by such forward-looking statements.
For example, the parties to the Option Agreement may
not complete the second and third option phases as
described and/or the exploration
objective for the Exploration Properties may not be
achieved. In addition, Denison may decide or
otherwise be required to discontinue testing,
evaluation and other work on the
Company's other properties if it is unable to maintain or
otherwise secure the necessary resources (such as testing
facilities, capital funding, joint venture
approvals, regulatory approvals, etc.).
Denison believes that the expectations reflected in this
forward-looking information are reasonable but no assurance can be
given that these expectations will prove to be accurate and results
may differ materially from those anticipated in this
forward-looking information. For a discussion in respect of risks
and other factors that could influence forward-looking events,
please refer to the factors discussed in Denison's Annual
Information Form dated March
28, 2024 under the heading
'Risk Factors' or in subsequent
quarterly financial reports. These factors are not, and should not
be construed as being, exhaustive.
Accordingly, readers should not place undue reliance on
forward-looking statements. The forward-looking information
contained in this news release is expressly qualified by this
cautionary statement. Any forward-looking information and the
assumptions made with respect thereto speaks only as of the date of
this news release. Denison does not undertake any obligation to
publicly update or revise any forward-looking information after the
date of this news release to conform such information to actual
results or to changes in Denison's expectations except
as otherwise required by applicable legislation.
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SOURCE Denison Mines Corp.