Skyharbour Enters into Major Strategic Agreement with Denison Mines to Form Four New Joint Ventures at Russell Lake; Combined Project Consideration of up to $61.5 Million

Executive Summary

• Skyharbour Resources Ltd. entered into a definitive strategic agreement with Denison Mines Corp. to acquire an initial project interest in Skyharbour’s Russell Lake Uranium Project, dividing the asset into four separate joint ventures.
• The total combined project consideration is valued at up to CAD $61.5 million, comprising up to $21.5 million in cash or share payments to Skyharbour (including $18.0 million before year-end) and up to $40.0 million in exploration expenditures by Denison.
• Denison will earn initial interests in four specific zones (Wheeler North, Russell Lake/RL, Getty East, and Wheeler River Inliers), with options to increase its stake in Wheeler North and Getty East up to 70% through future earn-in obligations.

Key Details

• Transaction Structure: The Russell Lake Project (73,314 hectares) is reorganized into four joint ventures:
  • Russell Lake (RL): Skyharbour retains 80%; Denison acquires 20%. Skyharbour remains operator. Denison funds its pro-rata share up to $10 million total expenditures through Dec 31, 2029.
  • Wheeler North: Skyharbour retains 51%; Denison acquires 49%. Denison becomes operator. Subject to earn-in options to reach 70%.
  • Getty East: Skyharbour retains 70%; Denison acquires 30%. Skyharbour remains operator initially. Subject to earn-in options to reach 70% and become operator.
  • Wheeler River Inliers: Skyharbour retains 30%; Denison acquires 70%. Denison becomes operator.
• Financial Consideration:
  • Upfront Payment: $2 million cash paid immediately upon execution.
  • Deferred Consideration: $16 million payable on or before December 31, 2025.
    • $8 million payable on or before the fifth business day prior to December 21, 2025.
    • $8 million payable within 10 days of December 21, 2025.
  • Payment Method: Deferred consideration may be paid in cash or Denison shares at Denison’s election.
  • Expenditures: Denison commits to up to $40 million in exploration expenditures over seven years.
• Denison Earn-In Options:
  • Wheeler North (Up to 70%):
    • Phase 1: Earn additional 11% (total 60%) by incurring $10 million in exploration expenditures (including $2.5 million within 24 months) and paying $1.5 million cash within 48 months.
    • Phase 2: Earn additional 10% (total 70%) by incurring an additional $15 million in expenditures and paying $2.0 million cash within 7 years.
  • Getty East (Up to 70%):
    • Phase 1: Earn additional 19% (total 49%) by incurring $5 million in expenditures (including $1.5 million within 24 months).
    • Phase 2: Earn additional 21% (total 70%) by incurring an additional $10 million in expenditures within 7 years.
• Operational Updates:
  • Skyharbour remains operator of the RL claims (53,192 hectares) and Getty East (initially).
  • Skyharbour will continue to advance its Moore Uranium Project and RL claims.
  • Denison will fund exploration at Getty East to fulfill earn-in criteria.
  • Skyharbour will receive an administrative fee for operating the McGowan Lake exploration camp.
• Regulatory Status: Transaction is subject to TSX Venture Exchange approval and is classified as a Reviewable Transaction due to common directorship (David Cates).

Notable Quotes

• Jordan Trimble, President and CEO of Skyharbour: “This is a transformative transaction for Skyharbour and our shareholders as it represents a major stamp of approval for Russell with up to $61.5 million in combined project consideration coming in... Furthermore, we will receive a significant amount of cash and Denison shares to help fund our exploration efforts and corporate activities through 2026.”
• David Cates, President and CEO of Denison: “Given its proximity to Wheeler River, Denison has had an interest in adding Russell to our property portfolio for much of my nearly two decades with the Company. This transaction achieves that objective by providing Denison with the opportunity to lead and participate in exploration efforts across four newly created joint ventures...”