Gold Reserve Inc. (GDRZF)

[Enterprising Investor]

Gold Reserve Provides Update on Previously Announced Return of Capital Transaction (4/18/19)

SPOKANE, Wash.--(BUSINESS WIRE)--Gold Reserve Inc. (TSXV: GRZ) (OTCQX: GDRZF) (“Gold Reserve” or the “Company”) is providing an update regarding its previously announced intention to return between US$90 and US$100 million in the aggregate to holders (the “Shareholders”) of its Class A common shares (the “Class A Shares”) pursuant to a return of capital transaction (the “Return of Capital Transaction”).

Following the Government of Canada’s decision on April 15, 2019 to impose sanctions against 43 additional individuals under the Special Economic Measures (Venezuela) Regulations of the Special Economic Measures Act, Gold Reserve’s board of directors (the “Board”) has determined that it is in the best interests of the Company and its Shareholders to reduce the aggregate amount of capital to be returned to Shareholders pursuant to the Return of Capital transaction to approximately US$75 million, or approximately US$0.76 per Class A Share.

The imposition of the April 15, 2019 sanctions poses a significant impediment to the Company’s ability to work with government officials related to the development of the Siembra Minera gold copper project, and the Company’s ability to work with government officials responsible for the payment and transfer of funds associated with the Settlement Agreement.

The Company expects to apply for a license from the US Treasury Department’s Office of Foreign Assets Control (OFAC) to allow the Company to pursue payments under the Settlement Agreement and allow international financial institutions to facilitate such transactions to North America at least in the near term without violating US sanctions on Venezuela. The Company may also pursue similar relief from sanctions imposed under Canadian law. There can be no assurance that the Company will obtain such relief or licenses.

Receipt of Interim Order

Gold Reserve is pleased to announce that it has obtained an interim order of the Alberta Court of Queen’s Bench (the “Court”) authorizing, among other things, the holding of the Company’s annual general and special meeting of Shareholders (the “Meeting”). At the Meeting, among other things, the Shareholders will be asked to consider and vote on a special resolution (the “Special Resolution”) approving a statutory plan of arrangement (the “Arrangement”) whereby, subject to the terms and conditions of the Arrangement, the Company will complete the distribution of US$75 million, or approximately US$0.76 per Class A Share pursuant to the Return of Capital Transaction.

The Meeting will be held on June 13, 2019 at 9:30 a.m. at 999 W. Riverside Avenue, 7th Floor, Masthead Suite, Spokane, Washington, USA. Meeting materials, including a notice of annual general and special meeting and information circular, will be mailed shortly to Shareholders of record as of the close of business on April 24, 2019. The meeting materials will also be available for review on the Company’s website at www.goldreserveinc.com under 2019 Annual Shareholder Meeting and under the Company’s profile on SEDAR at www.sedar.com.

Assuming approval of the Arrangement at the Meeting, the Company will return to the Court on June 13, 2019 to seek a final order to implement the Arrangement. Assuming such final order is obtained, the Company expects to implement the Arrangement and complete the Return of Capital Transaction on or about June 14, 2019 (the “Effective Date”). All registered and beneficial Shareholders as of the Effective Date will be entitled to receive the distribution of approximately US$0.76 per Class A Share to be made pursuant to the Return of Capital Transaction.

The Company’s board of directors has unanimously approved the Arrangement and recommends that Shareholders vote FOR the Special Resolution.

Full details of the Return of Capital Transaction will be described in the Company’s management information circular and other related materials. Those documents are expected to be mailed to Shareholders, filed with applicable Canadian securities regulatory authorities and made available without charge on SEDAR at www.sedar.com and on EDGAR at www.sec.gov, and posted on the Company’s website at www.goldreserveinc.com, on or about May 9, 2019.

https://www.businesswire.com/news/home/20190418005411/en/Gold-Reserve-Update-Previously-Announced-Return-Capital