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PEMBROKE, Bermuda — Gold Reserve Ltd. (TSX.V: GRZ) (OTCQX: GDRZF) (“Gold Reserve” or the “Company”) is pleased to announce the closing of its previously announced best efforts private placement of common shares of the Company (the “Common Shares”) at a price of US$3.10 per Common Share, including the full exercise of the over-allotment option, of 9,677,500 Common Shares for gross proceeds of approximately US$30,000,250.00 (the “Offering”) with Cantor Fitzgerald Canada Corporation (“CFCC”) as sole agent and bookrunner. Following the Offering, there are a total of 122,714,914 Common Shares issued and outstanding.
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In connection with the Offering, the Company has paid CFCC a cash commission totaling US$1,215,045.00. Net proceeds from the Offering are expected to be used for expenditures related to the Company’s previously announced credit bid submitted for the common shares of PDV Holdings, Inc. (“PDVH”), the indirect parent company of CITGO Petroleum Corp. (the “Bid”), and for working capital and general corporate purposes.
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Any Common Shares sold to investors outside of Canada were sold pursuant to OSC Rule 72-503 and subject to compliance with applicable securities laws, will be free from resale restrictions under applicable Canadian securities laws, provided that the trade is not a “control distribution” (as defined in National Instrument 45-102 – Resale of Securities).
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A copy of the agency agreement in respect of the Offering will be filed on the Company’s profile at www.sedarplus.com.
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Two insiders of the Company acquired a total of 3,774,000 Common Shares for gross proceeds of US$11,699,400. Such participation will each be considered a “related party transaction” within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The related party transactions are exempt from the valuation and minority shareholder approval requirements of MI 61-101 by virtue of the exemptions contained in sections 5.5(a) and 5.7(1) (a) of MI 61-101 in that the fair market value of the consideration for the securities of the Company to be issued to the related parties does not exceed 25% of its market capitalization.
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NOT FOR DISSEMINATION IN THE UNITED STATES OR TO U.S. PERSONS OR FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES
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Cautionary Statement Regarding Forward-Looking statements
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This release contains “forward-looking statements” within the meaning of applicable U.S. federal securities laws and “forward-looking information” within the meaning of applicable Canadian provincial and territorial securities laws and state Gold Reserve’s and its management’s intentions, hopes, beliefs, expectations or predictions for the future. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management at this time, are inherently subject to significant business, economic and competitive uncertainties and contingencies. They are frequently characterized by words such as “anticipates”, “plan”, “continue”, “expect”, “project”, “intend”, “believe”, “anticipate”, “estimate”, “may”, “will”, “potential”, “proposed”, “positioned” and other similar words, or statements that certain events or conditions “may” or “will” occur. Forward-looking statements contained in this press release include, but are not limited to, statements relating to the Bid or the Offering.
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We caution that such forward-looking statements involve known and unknown risks, uncertainties and other risks that may cause the actual events, outcomes or results of Gold Reserve to be materially different from our estimated outcomes, results, performance, or achievements expressed or implied by those forward-looking statements, including but not limited to: failure to obtain any necessary regulatory approvals in connection with the Offering; the completion of the Offering and the closing thereof; that the proceeds obtained under the Offering or will be less than expected; the failure of the Company to negotiate or enter into any agreements required for the Offering; the discretion of the Special Master to consider the Bid, to enter into any discussions or negotiation with respect thereto; the Bid will not be approved by the Court as the “Final Recommend Bid” under the Bidding Procedures, and if approved by the Court may not close, including as a result of not obtaining necessary regulatory approvals, including but not limited to any necessary approvals from the U.S. Office of Foreign Asset Control (“OFAC”), the U.S. Committee on Foreign Investment in the United States, the U.S. Federal Trade Commission or the TSX Venture Exchange; failure of the Company or any other party to obtain sufficient equity and/or debt financing or any required shareholders approvals for, or satisfy other conditions to effect, any transaction resulting from the Bid; that the Company may forfeit any cash amount deposit made due to failing to complete the Bid or otherwise; that the making of the Bid or any transaction resulting therefrom may involve unexpected costs, liabilities or delays; that, prior to or as a result of the completion of any transaction contemplated by the Bid, the business of the Company may experience significant disruptions due to transaction related uncertainty, industry conditions, tariff wars or other factors; the ability to enforce the writ of attachment granted to the Company; the timing set for various reports and/or other matters with respect to the Sale Process may not be met; the ability of the Company to otherwise participate in the Sale Process (and related costs associated therewith
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