Consolidated Results

Consolidated net income was $332,000 or $0.00 per share for the three months ended September 30, 2008 compared with a consolidated net loss of $11,721,000 or $0.06 per share for the same period in 2007. For the nine months ended September 30, 2008, consolidated net loss was $23,886,000 ($0.13 per share) compared with consolidated net income of $23,702,000 ($0.13 per share) for the same period in 2007.

Revenue was $36,483,000 for the three months ended September 30, 2008 compared with $9,411,000 for the three months ended September 30, 2007. Revenue was $86,377,000 for the nine months ended September 30, 2008 compared to $39,939,000 for the nine months ended September 30, 2007, an increase of 116%.

Net cash from (used in) operations was ($11,107,000) for the three months ended September 30, 2008, compared with net cash from (used in) operations of ($9,139,000) for the three months ended September 30, 2007. For the nine months ended September 30, 2008 net cash from (used in) operations was ($9,437,000) compared with ($14,044,000) for the same period in 2007.

The Company expenses exploration expenditures on mineral properties not sufficiently advanced to identify their development potential. Exploration expenditures expensed totalled $7,682,000 for the three months ended and $18,034,000 for the nine months ended September 30, 2008 compared to $8,385,000 for the three months and $16,914,000 for the nine months ended September 30, 2007.

Significant events in the third quarter include:

- Uranium sales revenue increased by 116% over sales in the nine month period in 2007. Denison sold 370,000 pounds U3O8 during the quarter from U.S. production at an average price of $66.12 per pound and 147,000 pounds U3O8 from its Canadian production under the existing long-term contracts at an average price of $61.35 per pound.

- Spot prices for U3O8 decreased from $59.00 per pound at June 30, 2008 to $53.00 per pound at September 30, 2008 and is currently $48.00 per pound as quoted by Ux Consulting. The long-term price for U3O8 dropped from $80.00 per pound at June 30, 2008 to $75.00 per pound at September 30, 2008 and is currently $70.00 per pound as quoted by Ux Consulting.

- Denison Environmental Services ("DES"), a division of Denison Mines Inc., a subsidiary of the Company, was awarded a contract for care and maintenance at the Faro Mine Complex in the Yukon. The contract runs for three years at $7.2 million per annum.

- Exploration drilling at the Company's Mutanga uranium project in Zambia discovered three new zones of mineralization.

- Exploration drilling at the Wheeler River project in which Denison has a 60% interest, confirmed a new unconformity hosted mineralized zone with 600 metres of untested strike length.

- Production during the quarter at the Company's White Mesa mill in Utah totalled 286,000 lbs. U3O8 and 250,000 lbs V2O5. The Company's share of production at 22.5% owned McClean Lake totalled 184,000 pounds U3O8.

- Denison signed a second long-term contract for the supply of uranium from the White Mesa mill. The contract is for 20% of the production from the White Mesa mill during the years 2012 - 2017 inclusive, but not less than 200,000 pounds per year. Pricing under this contract is 95% of the long-term price at the time of delivery with an escalated floor price of $50.00 per pound.

- The Company obtained the operation permit for its tailings cell 4A at its White Mesa mill in Utah.

Revenue

Uranium sales revenue for the third quarter was $34,600,000. Sales from U.S. production were 370,000 pounds U3O8 at an average price of $66.12 per pound. Sales of Canadian production were 147,000 pounds U3O8 at an average price of $61.35 per pound. Revenue also includes the amortization of the fair value increment on sales contracts from the acquisition of Denison Mines Inc. in the amount of $947,000 in the quarter. Uranium sales revenue in the 2007 period totaled $7,395,000 from the net sale of 85,000 pounds U3O8 from Canadian production at an average sales price of $85.41 per pound.

Denison currently markets its uranium from the McClean Lake joint venture jointly with AREVA Resources Canada Inc. ("ARC"). Denison's share of current contracted sales volumes jointly marketed with ARC is set out in the table below:

Contracted Canadian Sales Volumes --------------------------------- (pounds U3O8 x 1000)(in thousands) 2008 2009 2010 Pricing ---- ---- ---- ------------------Market Related 588 392 49 80% to 85% of SpotLegacy Base Escalated 95 0 0 $20.00 to $26.00Legacy Market Related 60 0 0 96% of SpotAgreements with AREVA call for production to be allocated first to the market related contracts with any surplus to be apportioned evenly over the legacy contracts. The legacy base-escalated contracts have pricing formulas that result in sales prices well below current market prices.

The joint marketing of Canadian uranium production will cease at the end of 2008 except for the market related category above. Future long-term sales agreements for the Company's uranium inventory and production are expected to be primarily under market-related contracts.

In addition to the contracts noted above, the Company currently has two other long-term contracts in place. One is for the sale of 17% of the White Mesa mill production commencing in 2008 up to 6.5 million pounds with a minimum of 250,000 pounds in 2008 and 500,000 pounds in 2009 increasing to a minimum of 1,000,000 pounds by 2011. The sales price is 95% of the published long-term price for the month prior to delivery with a floor price of $45.00. The second contract is for 20% of the production from the White Mesa mill during the years 2012 to 2017 inclusive, but not less than 200,000 pounds per year. Pricing under this contract is 95% of the long-term price at the time of delivery with an escalated floor price of $50.00 per pound.

Revenue from the environmental services division was $1,434,000 for the three months ended September 30, 2008 compared to $1,443,000 in the same period in 2007. Revenue from the management contract with Uranium Participation Corporation was $425,000 for the three months ended September 30, 2008 compared to $505,000 for the third quarter of 2007.

Uranium Production

Total uranium production for the Company from its Canadian and U.S. operations was 470,000 pounds for the three months ended September 30, 2008 and 977,000 pounds for the nine months ended September 30, 2008. The McClean Lake joint venture produced 818,000 pounds U3O8 for the three months ended September 30, 2008 and 2,566,000 pounds U3O8 for the nine months ended September 30, 2008 compared to production of 385,000 pounds and 1,169,000 pounds during the same periods in 2007. Denison's 22.5% share of the 2008 production totaled 184,000 pounds during the three months and 577,000 pounds during the nine months ended September 30, 2008.

Production costs from Canadian operations for the quarter were CDN$58.92 per pound U3O8 including CDN$34.99 per pound U3O8 from amortization, depletion and depreciation costs. For the nine months ended September 30, 2008, production costs were CDN$55.94 per pound U3O8 including CDN$33.89 per pound U3O8 for amortization, depletion and depreciation costs.

Inventory from Canadian production was 46,000 pounds U3O8 at September 30, 2008.

Production at the White Mesa mill was 286,000 pounds U3O8 for the three months ended September 30, 2008 and 400,000 pounds U3O8 for the nine months ended September 30, 2008 compared to 16,000 pounds and 153,000 pounds U3O8 for the same periods in 2007. Processing of conventional ore commenced on April 28, 2008 and to September 30, 2008 production from conventional ore was 306,000 pounds U3O8. The Company also commenced producing vanadium during the third quarter and produced 250,000 pounds V2O5 to September 30, 2008. Production at the White Mesa mill continues to increase with over 166,000 pounds U3O8 and 294,000 pounds V2O5 produced in October 2008.

For the nine months ended September 30, 2008, production costs for processing conventional ore at the White Mesa mill totaled $61.93 per pound U3O8 and vanadium equivalent including $24.38 per pound for amortization, depletion and depreciation.

Inventory from US production was 76,500 pounds U3O8 and 250,000 pounds V2O5 at September 30, 2008.

Mineral Property Exploration

Denison is engaged in uranium exploration, as both operator and non-operator of joint ventures and as operator of its own properties in Canada, the U.S., Mongolia and Zambia. For the three months ended September 30, 2008 exploration expenditures totaled $7,682,000 compared to $8,385,000 for the three months ended September 30, 2007. For the nine months ended September 30, 2008, exploration expenditures totaled $18,034,000 compared with $16,914,000 for the nine months ended September 30, 2007.

In the Athabasca Basin region of Saskatchewan, Denison is engaged in uranium exploration on advanced projects as part of the ARC operated McClean and Midwest joint ventures and is participating in a total of 33 other exploration projects concentrated in the prospective eastern margin of the Athabasca Basin. Denison's share of exploration spending on its Canadian properties totaled $3,042,000 of which $2,855,000 was expensed in the statement of operations for the three months ended September 30, 2008. Exploration spending totaled $5,612,000 of which $5,547,000 was expensed in the statement of operations for the three months ended September 30, 2007. For the nine months ended September 30, 2008, Denison's share of exploration spending on its Canadian properties totaled $12,210,000 of which $11,329,000 was expensed compared with spending of $14,045,000 of which $13,441,000 was expensed in the nine months ended September 30, 2007.

Exploration expenditures of $2,099,000 for the three months ended September 30, 2008 ($2,716,000 for the three months ended September 30, 2007) and of $3,520,000 for the nine months ended September 30, 2008 ($3,177,000 for the nine month period in 2007) were spent in Mongolia on the Company's joint venture and 100% owned properties. The Company has a 70% interest in the Gurvan Saihan Joint Venture ("GSJV") in Mongolia. The other parties to the joint venture are the Mongolian government as to 15% and Geologorazvedka, a Russian government entity, as to 15%. Additional expenditures for development of the GSJV's Hairhan uranium deposits have also been incurred. Development work includes extensive resource delineation drilling, hydrogeological drilling, plant design and environmental studies.

In Zambia, the Company commenced exploration activities during the quarter, including an airborne geophysical survey, linecutting and drilling. Exploration expenditures during the quarter totaled $2,465,000. Additional expenditures for development of the Mutanga project continued. This work included development and hydrogeological drilling, metallurgical test work, environmental studies and engineering.

General and Administrative

General and administrative expenses were $4,322,000 for the three months ended September 30, 2008 compared with $3,138,000 for the three months ended September 30, 2007. The increase was primarily the result of the increase in the Company's operations, the acquisition and implementation of new information and financial systems, an increase in public company expenses due to additional compliance costs and an increase in non-cash stock compensation costs resulting from stock options granted in 2008. General and administrative expenses consist primarily of payroll and related expenses for personnel, contract and professional services and other overhead expenditures.

Other Income and Expenses

Other income (expense) totaled $8,451,000 for the three months ended September 30, 2008 compared with ($893,000) for the three months ended September 30, 2007. For the nine months ended September 30, 2008, other income (expense) totaled ($65,000) compared to $37,343,000 for the same period in 2007. During the third quarter, this consists primarily of interest income, interest expense, and foreign exchange gains. Foreign exchange gains totaled $9,197,000 for the three months and $232,000 for the nine months ended September 30, 2008 arising from the translation of the Zambian kwacha into the U.S. dollar. In 2007, other income (expense) included a gain on the sale of portfolio investments of $1,108,000 and $39,751,000 for the three months and nine month periods. Other income (expense) also included interest paid on company indebtedness of $902,000 for the three months and $1,422,000 for the nine months ended September 30, 2008.

Outlook

Mining and Production

Canada

Mining of the Sue B deposit, which contains approximately 1.4 million pounds U3O8, is underway and is expected to be completed by year end. Milling of the stockpiled Sue E, Sue B and Sue A ore is ongoing and U3O8 production at McClean Lake in 2008, which will be primarily ore from Sue E, is expected to be 3.2 million pounds of which Denison's share is 720,000 pounds. Stripping and mining of the Caribou deposit is expected to commence in March 2009. Denison's share of production in 2009 is expected to be 750,000 pounds U3O8.

United States

Five mines are operating on the Colorado Plateau with production from the Sunday, Pandora, Topaz, West Sunday and Rim mines running at about 400 tons per day. At the Tony M mine within the Henry Mountains Complex, located in Utah, production is currently approximately 340 tons per day. In addition to the mined ore, historic stockpile ore from Tony M is being hauled to the mill at a rate of approximately 470 tons per day. There is an estimated 85,000 tons of this stockpile material remaining at the mine site. Production from these mines is being hauled to Denison's White Mesa mill. At September 30, 2008, a total of 289,000 tons had been shipped to the mill of which 140,500 tons have been fed to the mill. Mine development work has begun at the Beaver mine located on the Colorado Plateau. Ore production from this mine is anticipated to begin in December 2008 and will ramp up to 150 tons per day by second quarter 2009. At the Company's Arizona 1 mine on the Arizona Strip, located in northeastern Arizona, the shaft rehabilitation and ventilation raises are complete. The air quality permitting process is underway but the Company is unable to determine the length of time required to receive the permit.

Processing of conventional ore at the mill began on April 28, 2008. The mill processed uranium-only ore to June 30, 2008. On July 1, 2008, processing of the uranium/vanadium ores from the Company's Colorado Plateau mines commenced. Some Tony M ore was processed in August as the vanadium circuit worked through some commissioning issues. The mill is anticipating processing Colorado Plateau ore for the remainder of the year. The relining of tailings cell 4A is complete and approval of the operating permit has been received.

The Company expects to produce 1.0 million pounds U3O8 and 1.5 to 2.0 million pounds V2O5 during 2008 at the White Mesa mill. In 2009, production at the White Mesa mill is expected to be 1.4 million to 1.8 million pounds U3O8 and 2.6 million pounds to 3.2 million pounds V2O5.

Sales

The Company expects to sell 1.6 to 1.7 million pounds of U3O8 in 2008 including 0.9 to 1.0 million pounds from U.S. production. It also anticipates selling 1.0 to 1.3 million pounds of vanadium. Vanadium prices are quite volatile but have recently been quoted at $10 to $11 per pound V2O5.

Exploration(1)

Athabasca Basin

In the Athabasca Basin, Denison is participating in a total of 35 exploration projects, located in the eastern part of the Basin and within trucking distance of all the three operating mills in the area. Denison and its joint venture partners carried out an extensive exploration program during this quarter with drilling activity on 8 of Denison's 35 projects.

On the 60% owned Wheeler River property, a new zone of unconformity hosted uranium mineralization at a depth of less than 400 metres was discovered and reported in the second quarter. Preliminary results were reported based on eU3O8 grades. Confirmatory split core assay results have now been received from these holes, and have substantially upgraded the intersections. Drill hole WR-249 graded 1.72% U3O8(2) over 1.35 metres(3) as compared to the previously reported grade of 0.263% eU3O8 over 2.0 metres and drill hole WR-251 graded 0.775% U3O8 over 2.25 metres as compared to the previously reported grade of 0.248% eU3O8 over 2.8 metres. In addition, late in the summer, WR-253 was spotted 15 metres to the south-east of WR-251, and intersected the target horizon at the unconformity and returned the highest results to date of 1.40% U3O8 over 4.0 metres, in the sandstone, and 1.75% U3O8 over 0.5 metres, in the basement.

The new Zone R has only been tested on two sections with 600 metres of untested strike length between the two sections. A drill hole 30 metres to the northeast of WR-253 overshot the zone, and WR-255, the last hole of the season located 30 metres southwest of WR-253, was lost in a void in an intensely altered zone above the unconformity. The geophysical signature extends a further 300 metres to the southwest and 150 metres to the northeast of the current sections, indicating a potential one-kilometre long zone. Infill and stepout drilling is scheduled for 2009.

Denison's exploration spending in 2008 in the Athabasca Basin is expected to total $13,300,000.

(1) The technical information contained in this MD&A relating to the above-described exploration activities is reported and verified by William C. Kerr, Denison's Vice President, Exploration, who is a "qualified person" as defined in National Instrument 43-101.

(2) Values reported herein are based on a 0.05% U3O8 cutoff.

(3) All intersections and geological interpretations are based on diamond drill core only and mineralized intervals may not represent true thickness. For a description of the quality assurance program and quality control measure applied by Denison during the above described work, please see Denison's Annual Information Form filed on March 28, 2008 under the Company's profile on the SEDAR website at www.sedar.com.

Southwest United States

Drilling began early in the quarter on the Monogram Mesa project. While interesting and low level mineralization was identified in several widely spaced holes, no significant mineralization was noted. A drill program near the Company's Pandora mine is scheduled to begin in mid-November.

Mongolia

Work in Mongolia was completed late in the quarter and consisted of a total of over 72,000 metres of drilling in 474 holes on five projects. Three new discoveries were made this season: at Hairhan along trend of the known mineralization; at Haraat parallel to known mineralization; and, a new deep zone at Ulziit. All these new discoveries will require additional drilling.

On the development side, hydrogeological work continued to mid-September in support of baseline and monitoring test wells at Hairhan. A number of environmental radiological programs were initiated and will continue in support of advancement to commercial ISR production at Hairhan.

An updated 43-101 compliant resource estimate for the Hairhan deposit which will incorporate the 2007 and 2008 drilling results will be completed in the first quarter of 2009. A revised 43-101 compliant resource estimate on the Haraat deposit is scheduled to be completed in the second quarter of 2009.

Zambia

Site activities during this quarter consisted of completion of a major airborne geophysical survey, detailed linecutting and exploration drilling on selected areas outside of the two proposed pit sites, hydrogeological drilling to define baseline hydrogeological groundwater parameters and environmental baseline studies. A total of three drill rigs continued work during the quarter and completed over 55,000 metres of drilling year to date, composed of 41,742 metres in support of development drilling, 10,654 metres committed to exploration drilling and 2,087 metres devoted to hydrogeological drilling.

As announced on September 18, 2008, three areas were classified as new uraniferous discoveries based on work during this quarter and require further confirmatory and infill drilling in subsequent programs. All the new discoveries are located within five kilometres of the main Mutanga deposit which is scheduled to be the first deposit mined.

In addition to the site activities, other project activities include: a 43-101 report on the Mutanga and Dibwe deposits, which is scheduled to be completed in the fourth quarter; metallurgical test work, including a pilot plant test and heap leach test work; infrastructure studies; development of a relocation plan; and, engineering in order to complete a detailed feasibility study by the end of the first quarter of 2009.

Liquidity

The Company had cash and cash equivalents at September 30, 2008 of $15,879,000 and portfolio investments with a market value of $21,039,000. The company has in place a $125,000,000 revolving credit facility with a term of three years. The facility includes a covenant which would reduce the credit facility to $80,000,000 by June 30, 2009 if the Company does not meet a production level of 1,700,000 pounds for 2008. An agreement has been reached with the bank to amend the production covenant to include vanadium production equivalent to uranium at a five to one ratio. Bank indebtedness under the facility at September 30, 2008 was $101,332,000.

Recent turmoil in world financial markets has severely curtailed access to debt and other capital. The Company's spending plans and budgets for 2009 are currently being completed and are being tailored to fit within existing capital resources. This will result in decreased spending in all our exploration and development projects in 2009.

Conference Call

Denison is hosting a conference call on November 13, 2008 starting at 10:00 a.m. (Eastern Standard Time) to discuss the third quarter 2008 results. The webcast will be available live through a link on Denison's website www.denisonmines.com and by telephone at 416-641-6139. A recorded version of the conference call will be available by calling 416-695-5800 (password: 3274398) approximately two hours after the conclusion of the call. The presentation will also be available at www.denisonmines.com.

Additional Information

Additional information on Denison is available on SEDAR at www.sedar.com and on the Company's website at www.denisonmines.com.

About Denison

Denison Mines Corp. is the premier intermediate uranium producer in North America, with mining assets in the Athabasca Basin Region of Saskatchewan, Canada and the southwest United States including Colorado, Utah, and Arizona. Further, the Company has ownership interests in two of the four conventional uranium mills operating in North America today. The Company also has a strong exploration and development portfolio with large land positions in the United States, Canada, Zambia and Mongolia.

Cautionary Statements

This press release contains statements which are not current statements or historical facts. They are "forward-looking information" as defined under Canadian securities laws and "forward-looking statements", within the meaning of the United States Private Securities Litigation Reform Act of 1995, concerning the business, operations and financial performance and condition of Denison which may be material and that involve risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by them.

The material risk factors that could cause actual results to differ materially from the forward-looking information and statements contained in this press release and the material risk factors or assumptions that were used to develop them include, but are not limited to, statements with respect to estimated production sales volumes, and the expected effects of possible corporate transactions and the development potential of Denison's properties; the future price of uranium, vanadium, nickel and cobalt; the estimation of mineral reserves and resources; the realization of mineral reserve estimates; the timing and amount of estimated future production; costs of production; capital expenditures; success of exploration activities; permitting timelines and permitting, mining or processing issues; currency exchange rate fluctuations; government regulation of mining operations; environmental risks; unanticipated reclamation expenses; title disputes or claims; and limitations on insurance coverage. Generally, these forward-looking-information and statements can be identified by the use of forward-looking terminology such as "plans," "expects" or "does not expect," "is expected," "budget," "scheduled," "estimates," forecasts," "intends," "anticipates" or "does not anticipate," or "believes," or variations of such words and phrases or state that certain actions, events or results "may," "could," "would," "might" or "will be taken," "occur" or "be achieved."

Forward-looking information and statements are based on the opinions and estimates of management as of the date such statements are made. 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-information and statements, including but not limited to risks related to: unexpected events during construction, expansion and start-up; variations in ore grade; amount of material mined or milled; delay or failure to receive board or government approvals; timing and availability of external financing on acceptable terms; risks related to international operations; actual results of current exploration activities; actual results of current reclamation activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of uranium, vanadium, nickel and cobalt; possible variations in ore reserves, grade or recovery rates; unexpected or challenging geological, hydrogeological or mining conditions which deviate significantly from our assumptions regarding those conditions; political risks arising from operating in certain countries, including the risks of nationalization, terrorism and sabotage; the risk of adverse changes in government legislation, regulations and policies; the risk of natural phenomena including inclement weather conditions, fire, flood, underground floods, earthquakes, pitwall failure and cave-ins; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; delays in the completion of development or construction activities, as well as those factors discussed in or referred to under the heading "Risk Factors" in Denison's Annual Information Form dated March 28, 2008 available at www.sedar.com and its Form 40-F available at www.sec.gov. Although management of Denison has attempted to identify material factors that could cause actual results to differ materially from those contained in forward-looking-information and statements, which only apply as of the date hereof and should not be relied upon as representing Denison's views as of any subsequent date, there may be other factors that cause results not to be as anticipated, estimated or intended.

There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking-information and statements. Denison does not undertake to update any forward-looking-information and statements that are included or incorporated by reference herein, except in accordance with applicable securities laws. Mineral resources, which are not mineral reserves, do not have demonstrated economic viability. Readers should refer to the Annual Information Form and the Form 40-F of the Company for the year ended December 31, 2007 and other continuous disclosure documents filed since December 31, 2007 available at www.sedar.com for further information relating to their mineral resources and mineral reserves.

--------------------------------------------------------------------------------------------------------------------------------------------------------DENISON MINES CORPManagement's Discussion and AnalysisNine Months Ended September 30, 2008(Expressed in U.S. Dollars, Unless Otherwise Noted)--------------------------------------------------------------------------------------------------------------------------------------------------------INTRODUCTION

This Management's Discussion and Analysis ("MD&A") of Denison Mines Corp. and its subsidiary companies and joint ventures (collectively, "Denison" or the "Company") provides a detailed analysis of the Company's business and compares its financial results with those of the comparable period in the previous year. This MD&A is dated as of November 12, 2008 and should be read in conjunction with the Company's unaudited consolidated financial statements and related notes for the nine months ended September 30, 2008 and the Company's audited consolidated financial statements and related notes for the year ended December 31, 2007. The financial statements are prepared in accordance with generally accepted accounting principles in Canada. All dollar amounts are expressed in U.S. dollars, unless otherwise noted.

Other continuous disclosure documents, including the Company's press releases, quarterly and annual reports, Annual Information Form and Form 40-F are available through its filings with the securities regulatory authorities in Canada at www.sedar.com and the United States at sec.gov/edgar.shtml.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This MD&A contains statements which are not current statements or historical facts. They are "forward-looking information" as defined under Canadian securities laws and "forward-looking statements", within the meaning of the United States Private Securities Litigation Reform Act of 1995, concerning the business, operations and financial performance and condition of Denison which may be material and that involve risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by them.

The material risk factors that could cause actual results to differ materially from the forward-looking information and statements contained in this MD&A and the material risk factors or assumptions that were used to develop them include, but are not limited to, statements with respect to estimated production sales volumes, and the expected effects of possible corporate transactions and the development potential of Denison's properties; the future price of uranium, vanadium, nickel and cobalt; the estimation of mineral reserves and resources; the realization of mineral reserve estimates; the timing and amount of estimated future production; costs of production; capital expenditures; success of exploration activities; permitting timelines and permitting, mining or processing issues; currency exchange rate fluctuations; government regulation of mining operations; environmental risks; unanticipated reclamation expenses; title disputes or claims; and limitations on insurance coverage. Generally, these forward-looking-information and statements can be identified by the use of forward-looking terminology such as "plans," "expects" or "does not expect," "is expected," "budget," "scheduled," "estimates," forecasts," "intends," "anticipates" or "does not anticipate," or "believes," or variations of such words and phrases or state that certain actions, events or results "may," "could," "would," "might" or "will be taken," "occur" or "be achieved."

Forward-looking information and statements are based on the opinions and estimates of management as of the date such statements are made. 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-information and statements, including but not limited to risks related to: unexpected events during construction, expansion and start-up; variations in ore grade; amount of material mined or milled; delay or failure to receive board or government approvals; timing and availability of external financing on acceptable terms; risks related to international operations; actual results of current exploration activities; actual results of current reclamation activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of uranium, vanadium, nickel and cobalt; possible variations in ore reserves, grade or recovery rates; unexpected or challenging geological, hydrogeological or mining conditions which deviate significantly from our assumptions regarding those conditions; political risks arising from operating in certain countries, including the risks of nationalization, terrorism and sabotage; the risk of adverse changes in government legislation, regulations and policies; the risk of natural phenomena including inclement weather conditions, fire, flood, underground floods, earthquakes, pitwall failure and cave-ins; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry; delays in the completion of development or construction activities and other factors listed under the heading "Risk Factors" in the MD&A for the year ended December 31, 2007. Although management of Denison has attempted to identify material factors that could cause actual results to differ materially from those contained in forward-looking-information and statements, which only apply as of the date hereof and should not be relied upon as representing Denison's views as of any subsequent date, there may be other factors that cause results not to be as anticipated, estimated or intended.

There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking-information and statements. Denison does not undertake to update any forward-looking-information and statements that are included or incorporated by reference herein, except in accordance with applicable securities laws.

OVERVIEW

Denison is a diversified, growth-oriented, intermediate uranium producer with active uranium mining operations in both the U.S. and Canada and development projects in Canada, Zambia and Mongolia. Denison's assets include an interest in 2 of the 4 licensed and operating conventional uranium mills in North America, with its 100% ownership of the White Mesa mill in Utah and its 22.5% ownership of the McClean Lake mill in Saskatchewan. Both mills are fully permitted and operating.

The Company also produces vanadium as a co-product from some of its mines in Colorado and Utah. The Company is also in the business of recycling uranium-bearing waste materials, referred to as "alternate feed materials", for the recovery of uranium, alone or in combination with other metals, at the Company's White Mesa mill.

Denison enjoys a global portfolio of world-class exploration projects, including properties in close proximity to the Company's mills in the Athabasca Basin in Saskatchewan and in the Colorado Plateau, Henry Mountains and Arizona Strip regions of the southwestern United States. Denison also has exploration and development properties in Mongolia, Zambia and, indirectly through its investments in Australia and the U.S.

Denison is the manager of Uranium Participation Corporation ("UPC"), a publicly traded company which invests in uranium oxide in concentrates and uranium hexafluoride. Denison is also engaged in mine decommissioning and environmental services through its Denison Environmental Services ("DES") division.

Denison is a reporting issuer in all of the Canadian provinces. Denison's common shares are listed on the Toronto Stock Exchange (the "TSX") under the symbol "DML" and on the American Stock Exchange (the "AMEX") under the symbol "DNN".

SELECTED FINANCIAL INFORMATION

The following selected financial information was obtained directly from or calculated using the Company's consolidated financial statements for the three months and nine months ended September 30, 2008, and 2007.

Three Months Three Months Nine Months Nine Months Ended Ended Ended Ended September 30, September 30, September 30, September 30,(in thousands) 2008 2007 2008 2007----------------------------------------------------------------------------Results of Operations:Total revenues $ 36,483 $ 9,411 $ 86,377 $ 39,939Net income (loss) 332 (11,721) (23,886) 23,702Earnings (loss) per share - Basic 0.00 (0.06) (0.13) 0.13 - Diluted 0.00 (0.06) (0.13) 0.12---------------------------------------------------------------------------- As at As atFinancial Position: Sept. 30, December 31, 2008 2007----------------------------------------------------------------------------Working capital $ 63,719 $ 75,915Long-term investments 21,039 20,507Property, plant and equipment 755,884 727,823Total assets 1,010,504 1,001,581Total long-term liabilities $ 280,793 $ 175,081----------------------------------------------------------------------------RESULTS OF OPERATIONS

General

The Company recorded net income of $332,000 ($0.00 per share) for the three months ended September 30, 2008 compared with a net loss of $11,721,000 ($0.06 per share) for the same period in 2007. For the nine months ended September 30, 2008, the Company recorded a net loss of $23,886,000 ($0.13 per share) compared with net income of $23,702,000 ($0.13 per share) for the same period in 2007.

Revenues totaled $36,483,000 for the three months ended September 30, 2008 and $86,377,000 for the nine months ended September 30, 2008 compared with $9,411,000 and $39,939,000 for the same periods in 2007. Expenses totaled $47,111,000 for the three months ended September 30, 2008 and $105,750,000 for the nine months ended September 30, 2008 compared to $21,251,000 and $56,921,000 for the same periods in 2007. Net other income (expense) totaled $8,451,000 for the three months ended September 30, 2008 and ($65,000) for the nine months ended September 30, 2008 compared with ($893,000) and $37,343,000 for the same periods in 2007.

Revenues

Uranium sales revenue for the third quarter was $34,600,000. Sales from U.S. production were 370,000 pounds U3O8 at an average price of $66.12 per pound. Sales of Canadian production were 147,000 pounds U3O8 at an average price of $61.35 per pound. Amortization of the fair value increment related to long term contracts from the acquisition of Denison Mines Inc. ("DMI") totaled $947,000 for the third quarter. Reported revenue is also impacted by the effect of foreign currency translations.

For the nine months ended September 30, 2008, uranium sales revenue totaled $79,776,000 consisting of sales of 520,000 pounds U3O8 from U.S. production at an average price of $71.71 and sales of 565,950 pounds of production from the McClean Lake joint venture at an average price of $59.01 per pound. Amortization of the fair value increment related to long term sales contracts from the acquisition of DMI totaled $8,590,000.

Uranium sales revenue for the same periods in 2007 totaled $7,395,000 for the three months and $30,951,000 for the nine months ended September 30, 2007 from the sale of 85,000 pounds U3O8 and 270,000 pounds U3O8 from Canadian production and sales of 75,000 pounds U3O8 from U.S. production all in the second quarter. Amortization of the fair value increment from DMI sales contracts was $503,000 and $1,512,000 respectively.

Denison currently markets its uranium from the McClean Lake joint venture jointly with AREVA Resources Canada Inc. ("ARC"). Denison' share of current contracts sales volumes jointly marketed with ARC is set out in the table below:

Contracted Canadian Sales Volumes --------------------------------- (pounds U3O8 x 1000)(in thousands) 2008 2009 2010 Pricing ---- ---- ---- ------------------Market Related 588 392 49 80% to 85% of SpotLegacy Base Escalated 95 0 0 $20.00 to $26.00Legacy Market Related 60 0 0 96% of SpotAgreements with AREVA call for production to be allocated first to the market related contracts with any surplus to be apportioned evenly over the legacy contracts. The legacy base-escalated contracts have pricing formulas that result in sales prices well below current market prices.

The joint marketing of Canadian uranium production will cease at the end of 2008 except for the market related contracts above. Future long-term sales agreements for the Company's uranium inventory and production are expected to be primarily under market related contracts.

In addition to the contracts noted above, the Company currently has two other long-term contracts in place. One is for the sale of 17% of the White Mesa mill production commencing in 2008 up to a total of 6.5 million pounds with a minimum of 250,000 pounds in 2008, 500,000 pounds in 2009 and increasing to a minimum of 1 million pounds by 2011. The sales price is 95% of the published long-term price for the month prior to delivery with a floor price of $45.00. The second contract is for 20% of the production from the White Mesa mill during the years 2012 to 2017 inclusive, but not less than 200,000 pounds per year. Pricing under this contract is 95% of the long term price at the time of delivery with an escalated floor price of $50.00 per pound.

Revenue from the environmental services division was $1,434,000 for the three months ended September 30, 2008 compared to $1,443,000 in the comparable 2007 period and was $3,929,000 for the nine months ended September 30, 2008 compared with $3,391,000 for the same period in 2007.

Revenue from the management contract with Uranium Participation Corporation was $425,000 for the three months ended September 30, 2008 and $2,611,000 for the nine months ended September 30, 2008 compared to $505,000 and $3,118,000 in the same periods in 2007.

Operating Expenses

Milling and Mining Expenses

The McClean Lake joint venture produced 818,000 pounds U3O8 for the three months ended September 30, 2008 and 2,566,000 pounds U3O8 for the nine months ended September 30, 2008 compared with 385,000 pounds U3O8 for the three months and 1,169,000 pounds U3O8 for the nine months ended September 30, 2007. Denison's 22.5% share of production totaled 184,000 pounds and 577,000 pounds respectively for the 2008 periods and 87,000 pounds and 264,000 pounds respectively for the 2007 periods.

Unit production cash costs in Canada are driven primarily by production volumes as the majority of costs do not vary with volume. These fixed costs for the McClean operations total approximately Cdn$46 million per year so as production volumes increase, the cost per pound decreases. Reagent costs are in addition to this cost as are amortization, depletion and depreciation costs. Production by the joint venture in 2008 is expected to be 3.2 million pounds U3O8. Canadian production costs for the quarter were CDN$58.92 per pound U3O8 including CDN$34.99 per pound U3O8 for amortization, depletion and depreciation costs. For the nine months ended September 30, 2008, production costs were CDN$55.94 per pound U3O8 including CDN$33.89 per pound U3O8 for amortization, depletion and depreciation costs.

Inventory from Canadian production was 46,000 pounds U3O8 at September 30, 2008.

The Company began processing conventional ore at the White Mesa mill on April 28, 2008. Prior to that the Company was processing alternate feed material and produced 94,000 pounds U3O8 prior to beginning processing conventional ore. Production from conventional ore was 286,000 pounds U3O8 and 306,000 pounds U3O8 for the three months and nine months ended September 30, 2008. The Company also produced 250,000 pounds V2O5 commencing in the third quarter. For the nine months ended September 30, 2008, production costs for processing conventional ore totaled $61.93 per pound U3O8 and vanadium equivalent including $24.38 per pound amortization, depletion and depreciation.

Inventory from U.S. production was 76,500 pounds U3O8 and 250,000 pounds V2O5 at September 30, 2008.

Sales Royalties and Capital Taxes

Sales royalties and capital taxes totaled $662,000 and $2,470,000 for the three and nine months ended September 30, 2008 compared with $522,000 and $1,503,000 for the same periods in 2007. Denison pays a Saskatchewan basic uranium royalty of 4% of gross uranium sales after receiving the benefit of a 1% Saskatchewan resource credit. Denison also pays Saskatchewan capital taxes based on the greater of 3.0% of gross uranium sales or capital tax otherwise computed under the Saskatchewan Corporation Capital Tax Act. The Saskatchewan government also imposes a tiered royalty which ranges from 6% to 15% of gross uranium sales after recovery of mill and mine capital allowances which approximate capital costs. Denison has sufficient mill and mine capital allowances available or anticipated to shelter it from the tiered royalty at current uranium prices for 2008.

MINERAL PROPERTY EXPLORATION

Denison is engaged in uranium exploration, as both operator and non-operator of joint ventures and as operator of its own properties in Canada, the U.S., Mongolia and Zambia. For the three months ended September 30, 2008 exploration expenditures totaled $7,682,000 compared to $8,385,000 for the three months ended September 30, 2007. For the nine months ended September 30, 2008 exploration expenditures totaled $18,034,000 compared with $16,914,000 for the nine months ended September 30, 2007.

In the Athabasca Basin region of Saskatchewan, Denison is engaged in uranium exploration on advanced projects as part of the ARC operated McClean and Midwest joint ventures and is also participating in a total of 33 other exploration projects concentrated in the prospective eastern margin of the Athabasca Basin. Denison's share of exploration spending on its Canadian properties totaled $3,042,000 of which $2,855,000 was expensed in the statement of operations for the three months ended September 30, 2008. For the three months ended September 30, 2007, exploration spending totaled $5,612,000 of which $5,547,000 was expensed. For the nine months ended September 30, 2008, Denison's share of exploration spending on its Canadian properties totaled $12,210,000 of which $11,329,000 was expensed compared with spending of $14,045,000 of which $13,441,000 was expensed in the nine months ended September 30, 2007.

Exploration expenditures of $2,099,000 for the three months ended September 30, 2008 ($2,716,000 for the three months ended September 30, 2007) and of $3,520,000 for the nine months ended September 30, 2008 ($3,177,000 for the nine month period in 2007) were incurred in Mongolia on the Company's joint venture and 100% owned properties. The Company has a 70% interest in the Gurvan Saihan Joint Venture ("GSJV") in Mongolia. The other parties to the joint venture are the Mongolian government as to 15% and Geologorazvedka, a Russian government entity, as to 15%. Additional expenditures for development of the GSJV's Hairhan uranium deposits have also been incurred. Development work includes extensive resource delineation drilling, hydrogeological drilling, plant design and environmental studies.

In Zambia, the Company commenced exploration activities during the quarter including an airborne geophysical survey, linecutting and drilling. Exploration expenditures during the quarter totaled $2,465,000. Additional expenditures for development of the Mutanga project continued. This work included development and hydrogeological drilling, metallurgical test work, environmental studies and engineering.

General and Administrative

General and administrative expenses totaled $4,322,000 for the three months ended September 30, 2008 compared with $3,138,000 for the three months ended September 30, 2007. For the nine months ended September 30, 2008, general and administrative expenses totaled $13,116,000 compared to $9,598,000 for the same period in 2007. The increase was primarily the result of the acquisition and implementation of new information and financial systems, an increase in public company expenses due to additional compliance costs and an increase in stock based compensation costs resulting from stock options granted in 2008. General and administrative expenses consist primarily of payroll and related expenses for personnel, contract and professional services and other overhead expenditures.

Other Income and Expenses

Other income (expense) totaled $8,451,000 for the three months ended September 30, 2008 compared with ($893,000) for the three months ended September 30, 2007. For the nine months ended September 30, 2008, other income (expense) totaled ($65,000) compared to $37,343,000 for the same period in 2007. During the third quarter, this consists primarily of interest expense, and foreign exchange gains. Foreign exchange gains totaled $9,197,000 for the three months and $232,000 for the nine months ended September 30, 2008. The translation of the Zambian kwacha to U.S. dollars accounts for the majority of these amounts. This is primarily the result from translating future income taxes payable relating to the Mutanga project. In 2007, other income (expense) was primarily due to gains on the sale of portfolio investments which totaled $1,108,000 and $39,751,000 for the three months and nine month periods in 2007.

Other income (expense) included interest incurred on company indebtedness of $902,000 for the three months and $1,422,000 for the nine months ended September 30, 2008.

Income Taxes

The Company has provided for a current tax recovery of $2,342,000 and for a future tax expense of $6,790,000. In March, 2008, the Zambian government enacted legislation which increased the income tax rate for mining companies from 25% to 30%. Accordingly, the Company recorded a future tax expense of $10,740,000 in the first quarter to adjust the future income tax liability. This amount has been partially offset by the recognition of previously unrecognized Canadian tax assets of $3,700,000.

Outlook

Mining and Production

Canada

Mining of the Sue B deposit, which contains approximately 1.4 million pounds U3O8, has commenced. Milling of the stockpiled Sue E, Sue B and Sue A ore is ongoing and U3O8 production at McClean Lake in 2008 is expected to be 3.2 million pounds of which Denison's share is 720,000 pounds. Stripping and mining of the Caribou deposit is expected to commence in March 2009. Denison's share of production in 2009 is expected to be 750,000 pounds U3O8.

United States

Five mines are operating on the Colorado Plateau with production from the Sunday, Pandora, Topaz, West Sunday and Rim mines running at about 400 tons per day. At the Tony M mine within the Henry Mountains Complex, located in Utah, production is currently approximately 340 tons per day. In addition to the mined ore, historic stockpile ore from Tony M is being hauled to the mill at a rate of approximately 470 tons per day. There is an estimated 85,000 tons of this stockpile material remaining at the mine site. Production from these mines is being hauled to Denison's White Mesa mill. At September 30, 2008, a total of 289,000 tons had been shipped to the mill of which 140,500 tons have been fed to the mill. Mine development work has begun at the Beaver mine located on the Colorado Plateau. Ore production from this mine is anticipated to begin in December 2008 and will ramp up to 150 tons per day by second quarter 2009. At the Company's Arizona 1 mine on the Arizona Strip located in northeastern Arizona, the shaft rehabilitation and ventilation raises are complete. The air quality permitting process is underway but the Company is unable to determine the length of time required to receive the permit.

Processing of conventional ore at the mill began on April 28, 2008. The mill processed uranium-only ore to June 30, 2008. On July 1, 2008, processing of the uranium/vanadium ores from the Company's Colorado Plateau mines commenced. Some Tony M ore was processed in August as the vanadium circuit worked through some commissioning issues. The mill is anticipating processing Colorado Plateau ore for the remainder of the year. The relining of tailings cell 4A is complete and approval of the operating permit has been received.

The Company expects to produce 1.0 million pounds U3O8 and 1.5 to 2.0 million pounds V2O5 during 2008 at the White Mesa mill. In 2009, production at the White Mesa mill is expected to be 1.4 million to 1.8 million pounds U3O8 and 2.6 million to 3.2 million pounds V2O5.

Sales

The Company expects to sell 1.6 to 1.7 million pounds of U3O8 in 2008 including 0.9 to 1.0 million pounds from U.S. production. The Company currently has agreements in place to sell 400,000 pounds from U.S. production at an average price of $61.50 and 177,000 pounds from Canadian production at an expected price of about $52.00 per pound in the fourth quarter. It also anticipates selling 1.0 to 1.3 million pounds of vanadium. Vanadium prices are quite volatile but have recently been quoted at $10 to $11 per pound V2O5.

Sales in 2009 are expected to be 2.1 to 2.4 million pounds U3O8 and 3 million pounds V2O5.

Exploration(1)

Athabasca Basin

In the Athabasca Basin, Denison is participating in a total of 35 exploration projects, located in the eastern part of the Basin and within trucking distance of all the three operating mills in the area. Denison and its joint venture partners carried out an extensive exploration program during the quarter with drilling activity on 8 of these 35 projects.

On the 60% owned Wheeler River property, a new zone of unconformity hosted uranium mineralization at a depth of less than 400 metres was discovered and reported in the second quarter. Preliminary results were reported based on eU3O8 grades. Confirmatory split core assay results have now been received from these holes, and have substantially upgraded the intersections. Drill hole WR-249 graded 1.72% U3O8(2) over 1.35 metres(3) as compared to the previously reported grade of 0.263% eU3O8 over 2.0 metres and drill hole WR-251 graded 0.775% U3O8 over 2.25 metres as compared to the previously reported grade of 0.248% eU3O8 over 2.8 metres. In addition, late in the summer, WR-253 was spotted 15 metres to the south-east of WR251, and intersected the target horizon at the unconformity and returned the highest results to date of 1.40% U3O8 over 4.0 metres, in the sandstone, and 1.75% U3O8 over 0.5 metres, in the basement.

The new Zone R has only been tested on two sections with 600 metres of untested strike length between the two sections. A drill hole 30 metres to the northeast of WR-253 overshot the zone, and WR-255, the last hole of the season located 30 metres southwest of WR-253, was lost in a void in an intensely altered zone above the unconformity. The geophysical signature extends a further 300 metres to the southwest and 150 metres to the northeast of the current sections, indicating a potential one-kilometre long zone. Infill and stepout drilling is scheduled for 2009.

Denison's exploration spending in 2008 in the Athabasca Basin is expected to total approximately $13,300,000.

(1) The technical information contained in this MD&A relating to the above-described exploration activities is reported and verified by William C. Kerr, Denison's Vice President, Exploration, who is a "qualified person" as defined in National Instrument 43-101.

(2) Values reported herein are based on a 0.05% U3O8 cutoff.

(3) All intersections and geological interpretations are based on diamond drill core only and mineralized intervals may not represent true thickness. For a description of the quality assurance program and quality control measure applied by Denison during the above described work, please see Denison's Annual Information Form filed on March 28, 2008 under the Company's profile on the SEDAR website at www.sedar.com.

Southwest United States

Drilling began early in the quarter on the Monogram Mesa project in the U.S. While interesting and low level mineralization was identified in several widely spaced holes, no significant mineralization was noted. A drill program near the Company's Pandora mine is scheduled to begin in mid-November.

Mongolia

Work in Mongolia was completed late in the quarter and consisted of a total of over 72,000 metres of drilling in 474 holes on five projects. Three new discoveries were made this season: at Hairhan along trend of the known mineralization; at Haraat parallel to known mineralization; and, a new zone at Ulziit. All these new discoveries will require additional drilling.

On the development side, hydrogeological work continued to mid-September in support of baseline and monitoring test wells at Hairhan. A number of environmental radiological programs were initiated and will continue in support of advancement to commercial ISR production at Hairhan.

An updated 43-101 compliant resource estimate for the Hairhan deposit which will incorporate the 2007 and 2008 drilling results will be completed in the first quarter of 2009. A revised 43-101 compliant resource estimate on the Haraat deposit is scheduled to be completed in the second quarter of 2009.

Zambia

Site activities during this quarter consisted of completion of a major airborne geophysical survey, detailed linecutting and exploration drilling on selected areas outside of the two proposed pit sites, hydrogeological drilling to define baseline hydrogeological groundwater parameters, and environmental baseline studies. A total of three drill rigs continued work during the quarter and completed over 55,000 metres of drilling year to date, composed of 41,742 metres in support of development drilling, 10,654 metres committed to exploration drilling, and 2,087 metres devoted to hydrogeological drilling.

Three areas can be classified as new uraniferous discoveries based on work during this quarter and require further confirmatory and infill drilling in subsequent programs. (See release dated September 18, 2008) All the new discoveries are located within 5 kilometres of the main Mutanga deposit which is scheduled to be the first deposit mined.

In addition to the site activities, other project activities include: a 43-101 report on the Mutanga and Dibwe deposits, which is scheduled to be completed in the fourth quarter; metallurgical test work, including a pilot plant test and heap leach test work; infrastructure studies; development of a relocation plan; and, engineering in order to complete a detailed feasibility study by the end of the first quarter of 2009.

LIQUIDITY AND CAPITAL RESOURCES

Cash and cash equivalents were $15,879,000 at September 30, 2008 compared with $19,680,000 at December 31, 2007. The decrease of $3,801,000 was due primarily to expenditures of $82,058,000 for property, plant and equipment, the purchase of long term investments totaling $13,413,000 and cash used in operations of $9,437,000 financed by an increase in debt obligations of $101,259,000.

Net cash used in operating activities was $9,437,000 during the nine month period ended September 30, 2008. Net cash from operating activities is comprised of net income for the period, adjusted for non-cash items and for changes in working capital items. Significant changes in working capital items during the period include a decrease of $18,120,000 in trade and other receivables and an increase of $42,112,000 in inventories. The decrease in trade and other receivables is primarily the result of the level of uranium sales in the period. The increase in inventories consists primarily of the increase in ore in stockpile, work in progress and finished goods.

Net cash used in investing activities was $96,632,000 consisting primarily of expenditures on property, plant and equipment of $82,058,000 and the purchase of long term investments of $13,413,000. The long term investment was the purchase of shares and warrants in Uranerz Energy Corp.

Net cash from financing activities consisted of $101,259,000 from debt obligations and $1,527,000 from the exercise of stock options.

In total, these sources and uses of cash resulted in a net cash outflow of $3,801,000 during the nine month period.

The Company has in place a $125,000,000 revolving term credit facility. The facility is repayable in full on June 30, 2011. The facility requires mandatory prepayment of outstanding credit in excess of $80,000,000 by June 30, 2009 should the Company's uranium production in 2008 fall below 1,700,000 pounds. Agreement has been reached with the lender to amend the production covenant to include vanadium production equivalent to uranium at a five to one ratio.

The borrower under the facility is Denison Mines Inc. ("DMI") and Denison Mines Corp. ("DMC") has provided an unlimited full recourse guarantee and a pledge of all of the shares of DMI. DMI has provided a first-priority security interest in all present and future personal property and an assignment of its rights and interests under all material agreements relative to the McClean Lake and Midwest projects.

The Company is required to maintain the following financial covenants on a consolidated basis:

- Minimum tangible net worth of $450,000,000 plus 50% of positive quarterly net income and 50% of net proceeds of all equity issues after December 31, 2007;

- Maximum ratio of total net debt to earnings before interest, taxes, depreciation and amortization and other allowed adjustments as defined in the credit agreement ("EBITDA"), of 3.5 to 1.0 for each fiscal quarter starting with the fiscal quarter ending December 31, 2008 and including the fiscal quarter September 30, 2009 and 3.0 to 1.0 for each fiscal quarter thereafter. EBITDA is calculated on a rolling four quarters' basis commencing with the third quarter 2008;

- Minimum interest coverage ratio of 3.0 to 1.0 using rolling EBITDA and rolling interest expense for each fiscal quarter starting with the fiscal quarter ending December 31, 2008; and

- Minimum current ratio of 1.1 to 1.0.

Interest payable under the facility is bankers acceptance rate or London Interbank Offered Rate ("Libor") plus a margin or prime rate plus a margin. The margin used is between 0 and 200 basis points depending on the credit instrument used and the magnitude of the net total debt to EBITDA ratio (the "ratio"). The facility is subject to a standby fee of 40 to 55 basis points depending upon the ratio. A standby fee of 55 basis points applies in all circumstances where the amounts drawn under the facility are less than $62,500,000.

While the above covenants do not apply to the third quarter, the Company believes it would comply with all cov