Company Website:
http://www.goldreserveinc.com
SPOKANE, Wash. -- (Business Wire)
Gold Reserve Inc. (TSX.V:GRZ) (OTCQB:GDRZF) is pleased to announce that
the three-member Tribunal at the World Bankâs International Center for
the Settlement of Investment Disputes (âICSIDâ) has awarded the Company
$740.3 million in accordance with the provisions of the CanadaâVenezuela
Bilateral Investment Treaty (âBITâ).
The Award represents $713 million for the fair market value of the
Brisas Project, $22.3 million for interest on the Award since April 2008
based on the US Treasury Bill rate compounded annually and $5 million
for reimbursement of legal and technical costs expended by the Company.
Payment of the Award is due and payable immediately with any unpaid
amounts accruing interest at Libor plus 2% per annum.
Gold Reserve and its legal counsel are evaluating the substantial text
of the Award and expect to have further comments on the Tribunalâs
decision in the near future. A copy of the full text of the Award will
be posted on the Companyâs website in the next few days.
Gold Reserve has commenced steps to ensure the recognition and
collection of the Award which is immediately enforceable in any of the
150-plus member states party to the New York Convention. The Company is
well financed and has the strong support of its stakeholders to pursue
the collection of the Award in full.
Gold Reserve expects that Venezuela will honor its international
obligations and will effect prompt payment of the tribunalâs unanimous
Award. While the Company is pleased with the Award it is less than the
value of the Brisas project at todayâs gold and copper prices and
Venezuela will substantially benefit from the development of the mine.
As previously reported, the Company expended approximately US$300
million developing the Brisas project to the construction stage prior to
its termination by Venezuela. The acquisition of the Companyâs valuable
engineering work product by the Venezuelan government would both
expedite and reduce the cost of the projectâs development. If requested,
Gold Reserve would also be prepared to assist in the fast-track
development of the Brisas Project.
The Company plans to distribute a substantial majority of any proceeds
received to its shareholders in the most efficient manner possible,
subject to the need to retain funds for operating and arbitration
related expenses, corporate income taxes and other obligations, such as
repayment of convertible notes (if not otherwise converted).
As of the date of this notice the Company has 76.1 million Class A
common shares issued and outstanding and holds approximately $8.8
million in cash. On a fully diluted basis, assuming all warrants,
options and convertible notes are converted to common shares, the
Company would have approximately 93.5 million Class A common shares
issued and outstanding and would hold approximately $18.8 million in
cash. This amount excludes any potential sale of the Brisas project
technical and engineering work product and approximately $19 million of
related equipment held for sale.
Gold Reserve President Doug Belanger stated, âThe board of directors,
management and employees of the Company are pleased that the Tribunal
was unanimous in deciding all phases of the Award in favor of the
Company. We feel vindicated by the Tribunalâs clear conclusion that the
Venezuelan government acted unlawfully in terminating the Brisas Project
in direct violation of the BIT. We are gratified to know that all of our
hard work prior to the unlawful termination of the project and
subsequently in the execution of our claim against the Venezuelan
government has been rewarded.
âOn behalf of the Board, we thank our legal team at White & Case, led by
Abby Cohen Smutny and Darryl Lew and supported by a host of talented and
dedicated professionals. We also acknowledge our employees, consultants
and legal and technical experts for their tremendous contribution and
dedication. Lastly, we commend our shareholders for their continued
support throughout this difficult, very costly and time consuming
process.
âAs our counsel studies the Award, the Company plans to reach out to the
government of Venezuela to explore ways to facilitate Venezuelaâs
ability to honor its obligations promptly. We are hopeful that Venezuela
will satisfy its obligations to the Company without delay and without
any further legal proceeding. Should they fail to do so, we are prepared
to pursue all available means to ensure that the amount awarded to the
Company is recovered in full. There are well documented procedures in
place for identifying and attaching sovereign commercial assets located
in States that are party to the New York Convention. The Company is
already well advanced in this effort.â
Please see our website at www.goldreserveinc.com
for further information including: International Arbitration, Brisas
Project, Corporate Obligations, Investor Information â pro forma diluted
Common Shares outstanding.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This release contains âforward-looking statementsâ or
âforward-looking informationâ as such terms are defined under applicable
U.S. and Canadian securities laws (collectively referred to herein as
âforward-looking statementsâ) with respect to the ICSID Award related to
the expropriation of the Companyâs Brisas Project by the Venezuela
government. 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 such as, among
other things, the Companyâs ability to collect such Award.
We caution that such forward-looking statements involve known and
unknown risks, uncertainties and other risks that may cause the actual
outcomes, financial results, performance, or achievements of Gold
Reserve to be materially different from our estimated outcomes, future
results, performance, or achievements expressed or implied by those
forward-looking statements.
Factors that could cause actual results to differ materially from
those in the forward-looking statements include the timing of and amount
of collection of the Award, if at all.
This list is not exhaustive of the factors that may affect any of
Gold Reserve's forward-looking statements. Investors are cautioned not
to put undue reliance on forward-looking statements. All subsequent
written and oral forward-looking statements attributable to Gold Reserve
or persons acting on its behalf are expressly qualified in their
entirety by this notice. Gold Reserve disclaims any intent or obligation
to update publicly or otherwise revise any forward-looking statements or
the foregoing list of assumptions or factors, whether as a result of new
information, future events or otherwise, subject to its disclosure
obligations under applicable U.S. or Canadian securities laws.
âNeither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of this
release.â
Contacts:
Gold Reserve Inc.
A. Douglas Belanger, President,
509-623-1500
Fax: 509-623-1634
Source: Gold Reserve Inc.
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