Castle Resources Inc.

October 07, 2010 14:11 ET

Castle Resources Completes $10,320,000 Private Placement

TORONTO, ONTARIO--(Marketwire - Oct. 7, 2010) - Castle Resources Inc. ("Castle" or the "Company") (TSX VENTURE:CRI) is pleased to announce today that it has raised gross proceeds of $10,320,000 by way of a brokered private placement (the "Offering") through Scotia Capital Inc., as lead agent, and D&D Securities Inc. (collectively, the "Agents"). 

Under the Offering the Company issued 1,100,000 flow-through common shares (each a "FT Shares") at a purchase price of $0.36 per FT Share for aggregate gross proceeds of $396,000, and 31,012,500 units of Castle (the "Units") at a price of $0.32 each for aggregate gross proceeds of $9,924,000, with each Unit consisting of one common share of Castle and one half of one common share purchase warrant (a "Warrant").

Each Warrant is exercisable to acquire one common share of Castle at $0.50 until October 7, 2012 , provided that if after four months and one day following the closing of the Offering, the closing price of the common shares of Castle on the principal market on which such shares trade is greater than $1.00 for 20 consecutive trading days, then Castle may accelerate the expiry date of the Warrants by disseminating a press release and giving notice to the holders thereof and in such case the Warrants will expire on the 20th business day after the date on which such notice is given and press release is disseminated by Castle.

The Agents received a cash commission of 7% of the gross proceeds raised through the Agents under the Offering, and 2,247,875 compensation options (each a "Compensation Option") entitling them to acquire up to 2,247,875 Units at a price of $0.32 per Compensation Option.

Proceeds from the Offering will be used for exploration and development of the Company's Granduc Property in British Columbia and Elmtree Property in New Brunswick, and for general working capital. The gross proceeds raised from the sale of FT Shares will be used by the Company to finance qualified Canadian exploration expenditures on its Canadian resource properties. All securities issued pursuant to the Offering, including the Compensation Options issued to the Agents, are subject to a four (4) month statutory hold commencing from closing. The Offering is subject to TSX Venture Exchange acceptance of requisite regulatory filings.

About Castle Resources

Castle Resources Inc. is a Toronto-based junior mineral exploration company focusing on high-quality, advanced development projects. Management's goal is to begin the redevelopment of the past producing Granduc Copper Mine and begin new exploration activities; as well, management is quickly advancing the Elmtree Gold Project in New Brunswick toward feasibility in 2010. For more information please visit the Castle Resources' website at


Certain statements contained in this news release may contain forward-looking information within the meaning of Canadian securities laws. Such forward-looking information is identified by words such as "estimates", "intends", "expects", "believes", "may", "will" and include, without limitation, statements regarding the company's plan of business operations (including plans for progressing assets), estimates regarding mineral resources, projections regarding mineralization and projected expenditures. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from such statements. Factors that could cause actual results to differ materially include, among others, metal prices, risks inherent in the mining industry, financing risks, labour risks, uncertainty of mineral resource estimates, equipment and supply risks, title disputes, regulatory risks and environmental concerns. Most of these factors are outside the control of the company. Investors are cautioned not to put undue reliance on forward-looking information. Except as otherwise required by applicable securities statutes or regulation, the company expressly disclaims any intent or obligation to update publicly forward-looking information, whether as a result of new information, future events or otherwise.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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