Apmex Physical - 1 oz. Gold Redeemable Trust registers units

By Toni Weeks

San Diego, Dec. 27 - Apmex Physical - 1 oz. Gold Redeemable Trust has registered transferable, redeemable units that will give investors indirect access to the gold market while providing them with the liquidity of an exchange-traded security.

According to an F-1 filing with the Securities and Exchange Commission, the trust, a mutual fund trust established March 10, 2011, intends to invest in and hold substantially all of its assets in 1 oz. American Gold Eagle bullion coins and 1 oz. Canadian Gold Maple Leaf bullion coins, although the trust may also purchase 1 oz. gold bullion bars and rounds. The trust may invest up to 20% of its total net assets in securities other than 1 oz. gold coins, but intends to hold about 97% of its assets in 1 oz. gold coins, with the remaining 3% held in cash or liquid investments to pay expenses and redemptions.

The initial offering will be $345 million of units at $10 apiece. The underwriters have an over-allotment option. The minimum investment is $1,000.

The units will be listed on the New York Stock Exchange Arca and the Toronto Stock Exchange. The ticker symbols have not yet been determined. Unitholders will be able to buy and sell the units like any other exchange-listed securities.

Unitholders may redeem their units on a weekly basis for 1 oz. gold coins for a redemption price equal to 100% of the net asset value of the redeemed units, less applicable redemption fees, shipping charges and taxes. The minimum redemption amount will be $10,000.

Unitholders may also redeem units for cash, subject to minimum redemption amounts. The redemption price will equal 95% of the lesser of (i) the volume-weighted average trading price of the units traded on NYSE Arca, or, if trading has been suspended on NYSE Arca, the trading price of the units traded on the TSX for the last five trading days during the month in which the redemption request is processed and (ii) the net asset value of the redeemed units on the last day of such month. The trust will retain the remaining 5% of the value of the redeemed units.

The units will incur an underwriting commission of 5% and offering expenses of 0.5% of the gross offering amount. Including 0.35% management fees, trustee expenses, transfer agent expenses and custodial, valuation and fund administration expenses, total fees are estimated at 6.47% for the first year.

Stifle Nicolaus & Co., Inc. and Lazard Capital Markets LLC will act as underwriters.

Oklahoma City-based Apmex Precious Metals Management Services, Inc. is the sponsor and manager of the offering.

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