Gold Reserve Announces Dalinar Energy Bid for Citgo

Rhea-AI Summary

Gold Reserve (GDRZF) has announced that its Delaware subsidiary, Dalinar Energy , submitted a bid on March 7, 2025, to become the Stalking Horse Bidder for the purchase of PDV Holding, Inc. shares, the indirect parent company of CITGO Petroleum Corp.

The bid is supported by a consortium including senior judgment creditors Koch Minerals Sarl and Koch Nitrogen International Sarl. The proposal combines equity and debt financing, aiming to satisfy all senior waterfall creditors' judgments in cash or non-cash consideration, plus a substantial portion of Gold Reserve's attached judgment.

The Special Master will review all bids and recommend a Stalking Horse Bid by March 14, 2025, with the Court scheduled to rule on objections by March 28, 2025. The bid's consummation, if selected and approved, requires various regulatory approvals, including from the U.S. Department of Treasury's Office of Foreign Assets Control (OFAC).

Positive

• Bid structure satisfies all senior creditors' judgments
• Substantial portion of Gold Reserve's judgment would be satisfied
• Strong consortium support including Koch entities
• Innovative warrant mechanism for junior creditors participation

Negative

• Bid subject to multiple regulatory approvals
• No guarantee of being selected as Stalking Horse Bidder
• Confidential bid terms create uncertainty
• Complex closing conditions could delay or prevent completion

PEMBROKE, Bermuda--(BUSINESS WIRE)-- Gold Reserve Ltd. (TSX.V: GRZ) (OTCQX: GDRZF) (“Gold Reserve” or the “Company”) announced that its Delaware subsidiary, Dalinar Energy Corporation (“Dalinar Energy”), submitted a bid on March 7, 2025 to be designated the Stalking Horse Bidder for the purchase of the shares of PDV Holding, Inc. (“PDVH”), the indirect parent company of CITGO Petroleum Corp., pursuant to the sales process being conducted by the U.S. District Court for the District of Delaware (the “Court”).

Dalinar Energy’s bid is supported by a consortium that includes judgment creditors senior to Gold Reserve in the Court’s priority waterfall, including Koch Minerals Sarl and Koch Nitrogen International Sarl.

Dalinar Energy’s bid relies on a combination of equity and debt financing. The bid, if approved by the Court, fully financed and consummated, satisfies, in cash or non-cash consideration, the attached judgments of all waterfall creditors senior to Gold Reserve. The bid also satisfies a substantial percentage of Gold Reserve’s attached judgment.

Dalinar Energy’s bid also includes a mechanism whereby creditors junior to Gold Reserve will have the option to participate, by receiving warrants in Gold Reserve in exchange for contributing a portion of their attached judgments to the bid.

Terms of the bid will remain confidential until the Special Master appointed to operate the sale process reviews all bids and recommends a Stalking Horse Bid or Base Bid to the Court by March 14, 2025. The Court is scheduled to rule on any objections to the Special Master’s recommendation by March 28, 2025.

Consummation of the bid, if selected and approved by the court, is subject to closing conditions and regulatory approvals, including but not limited to approval by the U.S. Department of Treasury’s Office of Foreign Assets Control (“OFAC”).

“We thank our consortium, and all of our partners, in particular our shareholders, who rallied behind Gold Reserve to make our bid a reality. We look forward to reporting on our progress in due course,” said Paul Rivett, Gold Reserve’s Executive Vice-Chair.

Additional information on Dalinar Energy can be found at https://www.dalinarenergy.com.

For further information regarding the bid or media enquiries regarding Gold Reserve or Dalinar Energy, please contact dalinar@hstrategies.com.

A complete description of the Delaware sale proceedings can be found on the Public Access to Court Electronic Records system in Crystallex International Corporation v. Bolivarian Republic of Venezuela, 1:17-mc-00151-LPS (D. Del.) and its related proceedings.

Cautionary Statement Regarding Forward-Looking statements

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.

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: the discretion of the Special Master to consider the Bid, to enter into any discussions or negotiation with respect thereto and that the Special Master may reject the Bid at any time; the Special Master may choose not to recommend a Stalking Horse Bid or Final Bid to the Court; the failure of the Company to negotiate the Bid, including as a result of failing to obtain sufficient equity and/or debt financing; that Bid submitted by the Company will not be selected as the “Stalking Horse Bid” or the “Final Recommend Bid” under the Bidding Procedures, and if selected may not close due to the Sale Process not being completed, including as a result of not obtaining necessary regulatory approval to close on the purchase of the PDVH shares, including but not limited to any necessary approvals from 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 any required shareholders approvals for, or satisfy other conditions to effect, any transaction resulting from the Bid; that the Company 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; the amount, if any, of proceeds associated with the Sale Process; the competing claims of other creditors of Venezuela, PDVSA and the Company, including any interest on such creditors’ judgements and any priority afforded thereto; uncertainties with respect to possible settlements between Venezuela and other creditors and the impact of any such settlements on the amount of funds that may be available under the Sale Process; and the proceeds from the Sale Process may not be sufficient to satisfy the amounts outstanding under the Company’s September 2014 arbitral award and/or corresponding November 15, 2015 U.S. judgement in full; and the ramifications of bankruptcy with respect to the Sale Process and/or the Company’s claims, including as a result of the priority of other claims. This list is not exhaustive of the factors that may affect any of the Company’s forward-looking statements. For a more detailed discussion of the risk factors affecting the Company’s business, see the Company’s Annual Information Form on Form 40-F and Management’s Discussion & Analysis for the year ended December 31, 2023 and other reports that have been filed on SEDAR+ and are available under the Company’s profile at www.sedarplus.ca and which have been filed on EDGAR and are available under the Company’s profile at www.sec.gov/edgar.

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 rules promulgated by the Securities and Exchange Commission and applicable Canadian provincial and territorial securities laws.

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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250307400906/en/

dalinar@hstrategies.com

Source: Gold Reserve Ltd.

FAQ

What is the deadline for the Court's decision on Gold Reserve's (GDRZF) Citgo acquisition bid?

The Court is scheduled to rule on objections to the Special Master's recommendation by March 28, 2025, with the Special Master's initial recommendation due by March 14, 2025.

How does Gold Reserve's (GDRZF) bid structure work for junior creditors?

Junior creditors can participate by receiving warrants in Gold Reserve in exchange for contributing a portion of their attached judgments to the bid.

What regulatory approvals does Gold Reserve (GDRZF) need for the Citgo acquisition?

The bid requires regulatory approvals including from the U.S. Department of Treasury's Office of Foreign Assets Control (OFAC).

Who are the major consortium partners supporting Gold Reserve's (GDRZF) Citgo bid?

The bid is supported by Koch Minerals Sarl and Koch Nitrogen International Sarl, who are senior judgment creditors in the Court's priority waterfall.