SPOKANE, WA,
June 11, 2012 /CNW/ - Gold Reserve
Inc. (TSX VENTURE: GRZ) (NYSE-MKT: GRZ) (the "Company") announced
today that it is notifying holders ("Holders" or "Noteholders") of
its 5.50% Senior Subordinated Convertible Notes due 2022 (the
"Notes") that the Company is modifying the Notice of Right of
Repurchase and its terms which were announced on May 17, 2012 and June 1,
2012. On May 17, 2012 the
Company announced that it had agreed with Holders of 87.8% of the
notes ("Large Noteholders") to restructure their Notes, subject to
shareholder approval and such consents as may be required under the
Indenture, that will allow the Company to restructure the Notes
with a combination of cash, common shares, modified terms for the
remaining balance of the Notes and a contingent value right. The
Company had offered the terms of that restructuring arrangement
("Proposed Restructuring") to all remaining Noteholders such that
the Holders of the remaining 12.2% of the Notes would have the
opportunity to elect to have their Notes repurchased for 100% cash
pursuant to the Put Option described below or accept the same
arrangement as was agreed with the Large Noteholders, which was
referred to as the Alternative Transaction.
Amendment # 2 is being filed to withdraw, at this
time, the Alternative Transaction that was announced on
June 1, 2012 for the remaining 12.2%
of the Noteholders. The Put Option for 100% cash continues to be
available upon the terms initially described in the Schedule TO
filed on May 17, 2012. The Company
intends to offer the Alternative Transaction as soon as reasonably
practicable but no sooner than 10 business days after the
expiration of the Put Option, subject to applicable legal
requirements and compliance with the terms osf Indenture.
As required by the Indenture (the "Indenture"),
dated May 18, 2007, by and among the
Company and The Bank of New York Mellon, as successor in interest
to The Bank of New York, as
Trustee ("Trustee") and the Co-Trustee named therein, the Company
offered to each Holder the right to sell (the "Put Option"), upon
the terms and subject to the conditions set forth in the Indenture,
the Notes, for cash, to the Company. The Put Option remains
available to the Holders. The Put Option for cash will expire at
5:00 p.m., New York City time, on June 15, 2012.
The Company intends to consummate its previously
announced agreement with the Large Noteholders. The Holders of the
remaining 12.2% of the Notes Holders will not have the opportunity
to participate in the Proposed Restructuring at this time. However,
the Company intends to offer to all such Holders an opportunity to
participate in the Proposed Restructuring as soon as reasonably
practicable but no sooner than 10 business days after the
expiration of the Put Option, subject to applicable legal
requirements and compliance with the terms of Indenture.
Following the expiration of the Put Option and the
expiration of the subsequent offer the Company intends to make to
Holders other than the Large Noteholders, the Company intends to
redeem all Notes that have not been repurchased pursuant to the Put
Option or restructuring pursuant to the Proposed Restructuring as
soon as practicable, subject to applicable legal requirements and
compliance with the terms of Indenture.
For further information please refer directly to
the Schedule TO Amendment # 2 and all other related filings for
further details at www.goldreserveinc.com, www.sedar.com, or
www.sec.gov.
"Neither 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."
SOURCE Gold Reserve Inc.