said March30 that it has executed a definitive share purchase agreement with to combinetheir respective African uranium mineral interests and create an Africa-focuseduranium development company.
Under theterms of the agreement, GoviEx will acquire Denison's wholly owned subsidiaryRockgate CapitalCorp., which holds all of Denison's African-based uraniuminterests, in exchange for 56,050,450 consideration shares of GoviEx and22,420,180 common share purchase warrants.
Eachwarrant is convertible into 1 common share of GoviEx at a price of 15 U.S.cents per share for a period of three years. The warrants will include anacceleration clause which will allow GoviEx to provide holders of the warrantswith written notice that they have 30 days to exercise the warrants on theoriginal terms, in the event that the closing price of GoviEx's common shareson the Canadian Securities Exchange be equal to or greater than 24 Canadiancents per share for 15 consecutive days.
Uponcompletion of the transaction, Denison will hold 25% of GoviEx's outstandingshares and 28% of GoviEx shares on a fully diluted basis.
Denisonwill also ensure that all of its African uranium interests are capitalized witha minimum working capital of US$700,000.
The assetportfolio of the combined company will include GoviEx's project in Niger andDenison's Mutanga project in Zambia. It will also includeDenison's Faleaproject, an advanced exploration-stage asset project in Mali, and theexploration-stage Dome project in Namibia.
At theclose of the transaction, GoviEx will control one of the largest uraniumresource bases among publicly listed companies, with combined measured andindicated resources of 124.29 million pounds of U3O8 plus inferred resources of73.11 million pounds of U3O8.
Denisonwill also have the right to appoint one director to the GoviEx board andparticipate in future GoviEx equity financings as long as Denison holds atleast 5% of GoviEx's issued and outstanding common shares.
As part ofthe transaction, GoviEx will undertake a nonbrokered private placement to raisegross proceeds of at least US$2.0 million. Denison will provide the lead orderfor 25% up to a maximum of US$500,000. The companies expect the placement to becompleted prior to the closing of their transaction projected for May 17.