A binding settlement has been reached between subsidiaries of Gold Reserve (TSE) and TVX Gold (TSE) concerning the Brisas concession in the Kilometre 88 region of southeastern Venezuela.
The TVX subsidiary will release all rights and claims to the property, thereby terminating all litigation between the parties, in exchange for 1.5 million Gold Reserve shares and 500,000 share purchase warrants. In addition, 1.25 million shares and 250,000 purchase warrants will be issued to the subsidiary’s minority owner.
Each share purchase warrant will entitle the holder to buy one common share of Gold Reserve for $10 during the 18-month period following the closing of the deal. The shares represented in this transaction will represent about 15% of the issued and outstanding shares in Gold Reserve.
In addition, Gold Reserve will place US$4.5 million in escrow, which will be released to a third party, in the event that a mining concession to exploit the deeper bedrock mineralization is granted to the Gold Reserve subsidiary. The deal was approved by the Toronto Stock Exchange and is scheduled to close Jan. 10.
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