Castle Silver Mines initial public offering to raise maximum of $3.4
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
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
VANCOUVER, Nov. 16, 2011 /CNW/ - Gold Bullion Development Corp.
(TSXV:GBB) (OTCPINK:GBBFF) and Castle Silver Mines Inc., a wholly-owned
subsidiary of Gold Bullion, announce that Castle Silver Mines has filed
a final prospectus with the securities commissions of each of the
provinces of Canada in connection with an initial public offering by
Castle Silver Mines, and a secondary offering to the shareholders of
Gold Bullion of shares of Castle Silver Mines by way of dividend in
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 final
prospectus, which is available under Castle Silver Mines' company
profile on SEDAR at www.sedar.com.
The TSX Venture Exchange has conditionally approved the listing of the
common shares of Castle Silver Mines, subject to, among other standard
listing conditions, completion of the initial public offering for
minimum gross proceeds of $2.8 million with satisfactory public
Industrial Alliance Securities Inc. is acting as agent for the initial
public offering on a "best-efforts" basis. Castle Silver Mines has
granted 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.
Closing of the initial public offering is expected to take place no
later than December 15, 2011.
"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, 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
shortly, 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 Inc.
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.
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:
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