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Rockgate Announces Termination of Agreement With Mega and Makes No Recommendation With Respect to the Denison Offer at This Time

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Rockgate Announces Termination of Agreement With Mega and Makes No Recommendation With Respect to the Denison Offer at This Time







Rockgate Capital Corp. (TSX:RGT) announced today that it has terminated its arrangement agreement with Mega Uranium Ltd. dated August 13, 2013 .

The Board of Directors of Rockgate determined today that the unsolicited take-over bid from Denison Mines Corp. pursuant to which Denison has offered to acquire all of the issued and outstanding shares of Rockgate constitutes a “Superior Proposal” within the meaning of the Arrangement Agreement. Mega subsequently waived its right to match the Denison Offer and, as provided for in the Arrangement Agreement, a termination fee of C$1,000,000, has been paid by Rockgate to Mega.


As a result, the Special Meeting of Shareholders of Rockgate scheduled for September 25, 2013 is cancelled.


The Board also announced today that it is not making a recommendation at this time with respect to the acceptance or rejection of the Denison Offer for the following reasons:


--  while the Denison Offer provides Rockgate shareholders with an
    opportunity to realize a premium to the trading price of Rockgate's
    shares prior to the announcement of the Denison Offer and a premium to
    the attributed value of the previously proposed transaction with Mega,
    the Board of Directors has concerns with the financial terms of the
    Denison Offer, the Denison Offer constitutes a change of control
    transaction, which is a different type of transaction than the
    previously proposed merger of equals with Mega. The Denison Offer thus
    need to be evaluated in this context;

--  as part of fulfilling the Board's legal and fiduciary duties in respect
    of the Denison Offer, the Board, together with its legal and financial
    advisors, will be evaluating all available alternatives, including
    engaging in discussions with interested third parties in order to
    solicit competing offers that could maximize shareholder value for
    Rockgate shareholders;

--  the Denison Offer is highly conditional. There are conditions in the
    Denison Offer which are not subject to a materiality threshold or other
    objective criteria but provide Denison with the sole discretion as to
    whether to proceed with the Denison Offer.

--  the minimum tender condition of 90% is very high and there is no
    certainty that the Denison Offer would be completed in the event that
    the minimum tender condition is not met.

--  the Denison Offer was unsolicited and made by Denison without the
    benefit of due diligence or any negotiations with Rockgate. The Board
    requires more time to adequately assess the adequacy of the Denison
    Offer and negotiate with Denison and other third parties to maximize
    Rockgate shareholder value.



The Board will be mailing a Directors’ Circular in accordance with Canadian disclosure requirements in due course and a copy will be filed on Rockgate’s SEDAR profile at Shareholders are encouraged to review the contents of the Directors’ Circular before making any decisions with respect to the Denison Offer.


The ongoing business of the Company continues unimpeded by these corporate actions. The Pre-Feasibility Study on Rockgate’s Falea uranium-silver-copper project is progressing as planned with the metallurgical flowsheet test work and completion of the PFS scheduled for mid-February 2014.


THERE IS NO NEED FOR SHAREHOLDERS TO DO ANYTHING AT THIS TIME. The Denison Offer is open for acceptance until October 25, 2013. The Board of Directors of Rockgate fully intends to communicate further with Shareholders on a timely basis, and in any event no later than seven days before the Expiry Date, regarding its recommendation with respect to the Denison offer.



Posted September 25, 2013

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