General Donlee Canada Inc. Announces Partial Redemption of 7% Convertible Debentures Due June 30, 2014

TORONTO, May 14, 2012 /CNW/ - General Donlee Canada Inc. (TSX: GDI) ("General Donlee" or the "Company") today announced that it has exercised its right to partially redeem its 7% convertible unsecured subordinated debentures maturing June 30, 2014 (the "Debentures") in accordance with the terms of the indentures governing the Debentures. On June 13, 2012 (the "Redemption Date"), the Company will redeem Debentures in an aggregate principal amount of $20,000,000, representing approximately 44.4% of the current outstanding balance of the Debentures. The record date for determining which holders of Debentures shall receive the proceeds of redemption shall be June 6, 2012.

On redemption, the Company will pay to the holders of redeemed Debentures the redemption price (the "Redemption Price") equal to the outstanding principal amount of the Debentures to be redeemed, together with all accrued and unpaid interest thereon up to but excluding the Redemption Date, for a total of $1,031.45 per $1,000 principal amount of Debentures. The Debentures that are redeemed will cease to bear interest from and after the Redemption Date.

There are approximately $45,027,000 in principal amount of Debentures outstanding. Based on certain conditions, the Debentures are convertible, at the holders' discretion, at $6.55 per share at any time prior to the maturity date of June 30, 2014. The Company intends to use funds from its new term credit facility to pay the Redemption Price of the redeemed Debentures.

The Debentures are expected to be redeemed on a pro rata basis to the nearest multiple of $1,000 in accordance with the principal amount of the Debentures registered in the name of each holder.  Holders of Debentures are not required to take any action in connection with the partial redemption.

About General Donlee Canada Inc.

General Donlee Canada Inc. is a leading diversified manufacturer of precision-machined products for the military, commercial and general aerospace industries, and a specialist in the manufacture of precision-machined products for the industrial products and power generation industries. General Donlee's operating strategy focuses on targeting niche markets for products that are aligned with its sophisticated manufacturing capabilities and skilled workforce.

Forward-Looking Information

Forward looking statements include the timing, final amount and allocation of the redemption proceeds. As with all forward-looking statements, caution must be exercised to ensure that appropriate interpretation is made. Certain forward-looking statements are based on information currently available to Management, but are subject to a number of uncertainties and risks that could cause actual results to differ materially from the results discussed in the forward-looking statements. These uncertainties and risks include, but are not limited to those listed under the "Risk Factors" section of the Company's 2011 Annual Information Form, dated March 30, 2012 (which can be found at www.sedar.com).

Further information can be found in the disclosure documents filed by General Donlee Canada Inc. with the securities regulatory authorities, available at www.sedar.com or through the Company's website at www.generaldonlee.com.

Garen Mikirditsian
President & Chief Executive Officer
Interim Chief Financial Officer
Telephone: [phone]
E-mail:  [email protected]
Web site: www.generaldonlee.com