This release is intended for distribution in Canada only and is not
intended for distribution to United States newswire services or for
dissemination in the United States
Castle Silver Mines initial public offering to raise maximum of
Proceeds from initial public offering to be used in part for exploration
on Castle Silver Mine property, Gowganda, Ontario
Gold Bullion shareholders to receive one share of Castle Silver Mines
for every 85 shares of Gold Bullion held on distribution record date
VANCOUVER, Sept. 19, 2011 /CNW/ - Gold Bullion Development Corp.
(TSXV:GBB) (OTCPINK:GBBFF) announces that Castle Silver Mines Inc., a
wholly-owned subsidiary of Gold Bullion, has filed a preliminary
prospectus with the securities commissions of each of the provinces of
Canada in connection with an initial public offering, and a secondary
offering to the shareholders of Gold Bullion of shares of Castle Silver
Mines by way of dividend in kind.
Initial Public Offering
Castle Silver Mines is effecting an initial public offering of 4,750,000
"flow-through" units at a price of $0.40 per unit, and a minimum of
3 million and a maximum of 5 million common share units at a price of
$0.30 per unit, for maximum gross proceeds to Castle Silver Mines of
$3.4 million. Each "flow-through" unit will consist of one common share
of Castle Silver Mines and one-half of a common share purchase
warrant. Each common share unit will consist of one common share of
Castle Silver Mines and one common share purchase warrant. Each full
warrant will entitle its holder to acquire one additional common share
of Castle Silver Mines at a price of $0.50 for a period of 18 months.
The proceeds from the initial public offering will be used by Castle
Silver Mines for exploration work on its Castle Silver Mine property,
future property acquisitions and for working capital and general
corporate purposes. A description of the recommended exploration
program for the Castle Silver Mine property is summarized in the
prospectus, which will be available under Castle Silver Mines' company
profile on SEDAR at www.sedar.com.
Industrial Alliance Securities Inc. is acting as agent for the initial
public offering on a "best-efforts" basis. Castle Silver Mines will
grant Industrial Alliance Securities an option to offer up to 750,000
additional common share units and up to 712,500 additional
"flow-through" units, representing 15% of the number of units offered,
to cover over-allotments, if any. The over-allotment option may be
exercised at the offering prices for a period of 30 days from the date
of closing of the offering. If Industrial Alliance Securities exercises
the over-allotment option in full after a maximum offering, the total
gross proceeds of the offering will be $3,910,000.
"Spin-Out" to Shareholders of Gold Bullion
Concurrently with the initial public offering, Gold Bullion Development
Corp., the sole shareholder of Castle Silver Mines, will distribute an
aggregate of approximately 1,950,000 common shares of Castle Silver
Mines to the shareholders of Gold Bullion resident in Canada, by way of
dividend in kind. Gold Bullion shareholders will receive one common
share of Castle Silver Mines for approximately every 85 issued and
outstanding Gold Bullion shares on the distribution record date. The
record date for the distribution of the Castle Silver Mines shares will
be set by the Board of Directors of Gold Bullion in accordance with the
policies of the TSX Venture Exchange. Gold Bullion will issue a press
release announcing the record date and the distribution ratio. Gold
Bullion will retain approximately 7.8 million shares of Castle Silver
In the event of an initial public offering by Castle Silver Mines in a
maximum amount of $3.4 million, investors in the initial public
offering will hold 50% of the outstanding shares of Castle Silver
Mines, Gold Bullion will hold 40% of the outstanding shares, and the
shareholders of Gold Bullion will hold in the aggregate 10% of the
Castle Silver Mines
Castle Silver Mines Inc. was incorporated in March 2011 as a
wholly-owned subsidiary of Gold Bullion, for the purpose of taking over
the silver assets and exploration activities currently carried on by
Gold Bullion, so that Gold Bullion can devote itself solely to
exploration for gold. Prior to the distribution record date, Castle
Silver Mines Inc. will acquire the Castle Silver Mine property in
Gowganda, Ontario from Gold Bullion, which comprises Gold Bullion's
sole silver exploration property. After such transfer, Gold Bullion
does not intend to be directly involved in silver exploration. Castle
Silver Mines may acquire additional interests in silver exploration
properties in the future.
The initial public offering by Castle Silver Mines and the distribution
by Gold Bullion of approximately 1,950,000 Castle Silver Mines common
shares to the shareholders of Gold Bullion are subject to regulatory
approval, including that of the TSX Venture Exchange.
Castle Gold Mines' common shares have not been registered under the
United States Securities Act of 1933, as amended, and may not be
offered or sold within the United States or to, or for the account or
benefit of, U.S. persons absent U.S registration or an applicable
exemption from U.S. registration requirements.
About Gold Bullion Development Corp.
Gold Bullion Development Corp. is a TSX Venture-listed junior natural
resource company focusing on the exploration and development of its
Granada Property near Rouyn-Noranda, Québec, and its Castle Silver Mine
property in Gowganda, Ontario.
For more information on Gold Bullion Development Corp. (TSXV:GBB)
(OTCPINK:GBBFF), visit our web site: http://www.GoldBullionDevelopmentCorp.com
Neither the TSX Venture Exchange nor its Regulation Service Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
This news release may contain forward-looking statements including but
not limited to comments regarding the timing and content of upcoming
work programs, geological interpretations, receipt of property titles,
potential mineral recovery processes, etc. Forward-looking statements
address future events and conditions and therefore, involve inherent
risks and uncertainties. Actual results may differ materially from
those currently anticipated in such statements.
SOURCE Gold Bullion Development Corp.
For further information:
Frank J. Basa, P.Eng., President and Chief Executive Officer
Tel.: (416) 625-2342
Roger Thomas, Director
Tel.: (613) 292-2438
Progressive Investor Relations (Canada)
Tel.: (604) 689-2881 or e-mail firstname.lastname@example.org
Torrey Hills Capital (United States) Tel.: (858) 456-7300