Denison Mines restructures debt

An agreement between Denison Mines (TSE) and its corporate lenders will allow the former blue-chip company to restructure bank debt, subject to certain conditions.

The lenders agreed to convert all debt under the credit

agreement to 10% of the total outstanding common shares of

Denison (after giving effect to the restructuring) and a

$30-million note which is

subordinated to the company’s environmental reclamation

commitments at Elliot Lake, Ont.

The terms of the note provide for 6% interest beginning June 30, 2000, and principal repayments of 75% of defined net cash flow beginning either on June 30, 2000, or upon completion of funding of its environmental trust, whichever comes first. Discussions with other stakeholders will follow.

Meanwhile, reduced depreciation and decommissioning provisions recorded against the results of the company’s Greek oil and gas division helped Denison more than double its earnings to $15.2 million in 1994 from $7.1 million in 1993. Revenue, however, dropped to $85.7 million from $95.7 million.

Earnings for the first quarter of 1995 were $5.5 million, up from $1.7 million in the same period last year.

Earlier this year, a production decision was announced for a $250-million mine and mill at the McClean uranium project in northern Saskatchewan, in which Denison holds a 22.5% interest.

Denison’s share of required funding has been arranged. The

project is expected to produce 6 million lb. of uranium in

concentrates each year, beginning in 1997.

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