Denison Mines executes uranium interests option with Foremost for up to $30M

Denison Mines (DNN) has executed an option agreement with a Nasdaq listed company to be renamed Foremost Clean Energy (FMST), which grants Foremost an option to acquire up to 70% of Denison’s interest in 10 uranium exploration properties. Pursuant to the transaction, Foremost would acquire such total interests upon completion of a combination of direct payments to Denison and funding of exploration expenditures with an aggregate value of up to approximately $30M. The transaction is structured to incentivize exploration activity, with Foremost required to invest a minimum of $8M in exploration expenditures to retain any interests in the properties and $20M in exploration expenditures to fully exercise the option. Collaboration with Foremost is expected to increase exploration activity on a portfolio of non-core Denison properties with the potential to increase the probability of discovery within Denison’s vast Athabasca Basin exploration portfolio. Denison is to receive meaningful consideration in the form of an upfront payment in Foremost common shares, representing ~19.95% ownership interest in Foremost post transaction, cash or common share milestone payments, and up to $20M in project exploration expenditures. Denison retains direct interests in the optioned exploration properties and will become Foremost’s largest shareholder, while also securing certain strategic pre-emptive rights to participate in future exploration success from the optioned properties. Denison currently has 100% ownership in all of the properties except for Hatchet Lake, which is subject to a joint venture agreement with Eros Resources, with Denison currently holding a 70.15% ownership interest. Foremost is expected to act as project operator during the term of the Option Agreement; however, Denison expects to leverage its significant team of technical experts based in its office in Saskatoon, Saskatchewan to support Foremost as it transitions to uranium exploration. Additionally, David Cates, President and CEO of Denison, is expected to join Foremost’s Board of Directors.