dml-press_releasereuraniu
Exhibit 99.1
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Denison Mines Corp.
1100 – 40
University Ave
Toronto, ON M5J
1T1
www.denisonmines.com
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NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR RELEASE,
PUBLICATION, DISTRIBUTION OR DISSEMINATION DIRECTLY OR INDIRECTLY,
IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES
PRESS
RELEASE
DENISON
ANNOUNCES FUNDING OF PROJECT FINANCE INITIATIVE
INVOLVING STRATEGIC
ACQUISITION OF PHYSICAL URANIUM
Toronto, ON – March 15, 2021
Denison Mines Corp. (“Denison” or the
“Company”) (DML: TSX, DNN: NYSE American) is pleased to
announce that it has entered into an agreement with Cantor
Fitzgerald Canada Corporation ("CFCC"), as lead underwriter and
sole book-runner, on behalf of themselves and a syndicate of
underwriters (collectively with CFCC, the "Underwriters"), under
which the Underwriters have agreed to purchase, on a bought deal
basis, 68,200,000 units of the Company (the "Units") at the
price of USD$1.10 per Unit (the "Issue Price") for aggregate gross
proceeds of approximately USD$75 million (the "Unit
Offering").
Net proceeds of
the Unit Offering are anticipated to be used to fund the strategic
purchase of uranium concentrates (“U3O8” or
“Uranium”) to be held by Denison as a long-term
investment, intended to support the potential future financing of
the advancement and/or construction of the Company’s flagship
90% owned Wheeler River Uranium Project (“Wheeler
River”). Uranium purchases are planned to be made in the
uranium spot market, with a target of accumulating approximately
2.5 million pounds U3O8.
The purchased
Uranium is expected to strengthen the Company’s balance sheet
and enhance its ability to access future project financing, with
the potential collateralization of the Uranium holdings. In
addition, the purchased Uranium could provide the Company with
increased flexibility to negotiate long-term Uranium supply
arrangements with future customers. If a future decision is made to
advance Wheeler River into construction, the Company would
eventually market its physical Uranium holdings to its future
customers along with the mine production from Wheeler
River.
This press release constitutes a "designated news release" for the
purposes of the Company's prospectus supplement dated November 13,
2020 to its short form base shelf prospectus dated June 2,
2020.
David Cates,
President and CEO of Denison, commented, “Public support for
carbon-free, base-load nuclear energy continues to grow as part of
the clean energy-transition movement. Denison is well positioned to
participate in this exciting narrative through the potential future
development of our flagship Wheeler River uranium project. With the
uranium market showing continued signs of incremental improvement
in supply and demand fundamentals, this strategic financing is
being undertaken at an ideal time for Denison – supporting
the opportunistic acquisition of physical Uranium to hold as a
long-term strategic capital asset.
The physical Uranium holdings that we expect to acquire will
represent a sizeable portion of Denison’s share (2018
Pre-Feasibility Study) of the expected CAD$290 million of initial
capital costs for Wheeler River. As a result, we expect this
transaction to enhance the long-term financial stability of the
company, as we advance towards a definitive development decision.
From a project finance standpoint, the physical Uranium holdings
could potentially de-risk the process by representing a meaningful
source of collateral. Similarly, we expect that our future
customers will value, as part of potential future discussions
regarding off-take or long-term contracting arrangements, the fact
that our Company will already have a sizeable base of physical
Uranium before achieving first production from Wheeler
River.
Importantly, with this transaction, Denison’s joins other
major publicly-traded uranium companies that have disclosed
sizeable physical uranium purchases in recent years, and we have
broken the conventional equity dilution model for mining
development companies –
as our shareholders will benefit from the additional financial
stability of our Uranium holdings, while remaining fully leveraged
to any future appreciation of uranium prices during the balance of
the environmental assessment and feasibility study processes
currently planned for Wheeler River.”
Unit Offering
Each Unit will
consist of one common share in the capital of the Company (a
“Common Share”) and one-half of one transferable common
share purchase warrant of the Company (each whole warrant, a
“Warrant”). Each Warrant is exercisable to acquire one
Common Share (a “Warrant Share”) at an exercise price
of USD$2.25 per Warrant Share for 24 months after issuance. The
Warrants will not be listed.
In addition,
Denison has agreed to grant to the Underwriters an over-allotment
option (the "Over-Allotment Option") exercisable, in whole or in
part, at the sole discretion of the Underwriters (subject to
certain agreed upon limitations), to purchase up to approximately
an additional 10,230,000 Units at the Issue Price for a period of
up to 30 days after the closing of the Unit Offering, for potential
additional gross proceeds to Denison of up to approximately
USD$11.25 million.
Denison will pay
to the Underwriters a cash commission equal to 5% of the gross
proceeds of the Unit Offering, including any proceeds received from
the exercise of the Over-Allotment Option.
The Unit Offering
will be made by way of a prospectus supplement (the "Prospectus
Supplement") to the Company's existing Canadian short form base
shelf prospectus dated June 2, 2020 (the "Base Shelf Prospectus").
The Prospectus Supplement will be filed with the securities
commissions in each of the provinces and territories
of Canada, except Quebec and is available on the SEDAR website
maintained by the Canadian Securities Administrators at
www.sedar.com. Alternatively, the Prospectus Supplement and related
Base Shelf Prospectus may be obtained upon request by contacting
the Company or Cantor Fitzgerald Canada Corporation in Canada,
attention: Equity Capital Markets, 181 University Avenue, Suite
1500, Toronto, ON, M5H 3M7,
email: ecmcanada@cantor.com.
The Unit Offering
is expected to close on or about March 22, 2021.
The
Company’s at-the market equity offering program qualified
under a supplement dated November 13, 2020 to the Base Shelf
Prospectus (the “ATM Offering”) will terminate in
connection with the Unit Offering and the Company will no longer
offer or sell any common shares through the facilities of the
Toronto Stock Exchange and/or NYSE American pursuant to such ATM
Offering.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy securities, nor will there be any
sale of the securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to the registration or
qualification under the securities laws of any such jurisdiction.
The securities being offered have not been approved or disapproved
by any regulatory authority, nor has any such authority passed upon
by the accuracy or adequacy of the Prospectus Supplement or the
Base Shelf Prospectus.
This press release does not constitute an offer to sell or a
solicitation of an offer to buy any of the securities in the United
States. The securities have not been and will not be registered
under the United States Securities Act of 1933, as amended (the
"U.S. Securities Act"), or any state securities laws and may not be
offered or sold within the United States or to or for the account
or benefit of a U.S. person (as defined in Regulation S under the
U.S. Securities Act) unless registered under the U.S. Securities
Act and applicable state securities laws or an exemption from such
registration is available.
About Denison
Denison is a
uranium exploration and development company with interests focused
in the Athabasca Basin region of northern Saskatchewan, Canada. The
Company's flagship project is the 90% owned 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. Denison's interests in Saskatchewan also
include a 22.5% ownership interest in the McClean Lake joint
venture ("MLJV"), which includes several uranium deposits and the
McClean Lake uranium mill, which is contracted to process the ore
from the Cigar Lake mine under a toll milling agreement, plus a
25.17% interest in the Midwest and Midwest A deposits, and a 66.90%
interest in the Tthe Heldeth Túé (“THT,”
formerly J Zone) and Huskie deposits on the Waterbury Lake
property. Each of Midwest, Midwest A, THT and Huskie are located
within 20 kilometres of the McClean Lake mill.
Denison is
engaged in mine decommissioning and environmental services through
its Closed Mines group (formerly Denison Environmental Services),
which manages Denison's Elliot Lake reclamation projects and
provides post-closure mine care and maintenance services to a
variety of industry and government clients.
Denison is also
the manager of Uranium Participation Corp., a publicly traded
company which invests in uranium oxide and uranium
hexafluoride.
For more information, please contact
David
Cates (416)
979-1991 ext. 362
President and
Chief Executive Officer
Sophia
Shane (604) 689-7842
Investor
Relations
Follow Denison on
Twitter @DenisonMinesCo
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
‘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’, ‘be
achieved’ or ‘has the potential to’.
In particular, this news release contains
forward-looking information pertaining to: the likelihood of
completion of the Unit Offering and estimated timing for
completion; the ability to obtain the necessary regulatory
authority and approvals to complete the Unit Offering; the use of
proceeds of the Unit Offering, including the acquisition of
approximate quantities of Uranium; the strategic objectives of
Denison, including the potential advancement of the Wheeler River
project through project evaluation and de-risking to construction
and production; the potential benefits to Denison of holding
physical uranium, including as financial de-risking, collateral
and/or appreciation in value; Denison’s joint venture
interests, and the continuation of its contracts with 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, if market
conditions remain volatile and/or COVID-19 mitigation measures
result in more social and economic disruptions, Denison may not be
able to complete the Unit Offering on the terms herein described or
at all or pursue its evaluation and environmental assessment
activities necessary to advance the Wheeler River project, which
could have significant impacts on Denison. Denison may not be able
to deploy the proceeds as intended, if Uranium is not available to
be purchased at all or at prices deemed appropriate. Further,
should the price of uranium materially decline, Denison’s
strategy of acquiring and holding physical uranium could expose
Denison to significant losses and adversely impact the financial
position of the Company. In addition, the currently anticipated
evaluation and environmental assessment activities may not be
maintained after further testing or Denison may decide or otherwise
be required to alter or discontinue testing, evaluation and
development work, if it is unable to maintain or otherwise secure
the necessary approvals or resources (such as testing facilities,
capital funding, etc.) and the Company may not be able to, or may
choose not to, proceed to a FS, construction or production for
Wheeler River. Denison believes that the expectations reflected in
this forward-looking information are reasonable and 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 the Management’s
Discussion & Analysis dated March 4, 2021 under the heading
“Risk Factors”. 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.