Almonty Announces Purchase of Outstanding Common Shares and Debenture of Woulfe in Exchange for Cash, Notes and Common Shares

Almonty Industries Inc. (TSXV:AII) announces that it has entered an agreement with Woulfe Mining Corp. (CVE:WOF) for a non-brokered private placement of $1 million in principal amount of convertible unsecured subordinated debentures at a price of $1,000 per debenture. The two companies also entered into an agreement that will see one member of Almonty join the board of directors of Woulfe for as long as Almonty holds a minimum of 5 percent of the issued and outstanding shares of Woulfe and provided that such nominees are acceptable to regulatory authorities.

As quoted in the press release:

The Debentures will have an interest rate of 12% per year, payable quarterly in arrears. Woulfe will have the option to satisfy, all or a portion of its interest payment obligations by delivering to Almonty common shares of Woulfe at a price equal to equal to the Market Price (as defined in the Canadian Securities Exchange Corporate Finance Manual) of Woulfe’s common shares on the interest settlement date. The Offering is expected to close on June 4, 2015 and will mature 12 months from closing.

Each $1,000 principal amount of the Debentures will be convertible at the option of the holder into 16,667 common shares of Woulfe.

Concurrently, Almonty has entered into an agreement with Dundee Corporation and Dundee Resources Limited whereby Almonty will acquire 29,497,229 common shares in the capital of Woulfe currently owned by Dundee at a deemed price of $0.056 per Woulfe share in exchange for issuing to Dundee 2,949,723 common shares of Almonty at a deemed price of $0.56 per Almonty common share. Almonty will also acquire the $4,000,000 principal amount 12% Unsecured Subordinated Convertible Debenture due December 31, 2016 issued to Dundee by Woulfe on March 7, 2014 in exchange for a cash payment to Dundee of $2,600,000 ($2,100,000 in cash on closing and $125,000 in cash in four equal installments on the dates that are three, six, nine and twelve months from the closing date) and the issuance to Dundee of a term promissory note in the principal amount of $1,400,000 due five (5) years after closing and bearing interest at 4% per annum.

Lewis Black, chairman, president and CEO of Almonty, commented:

Almonty continues to believe in the merits of combining one of the world’s most promising undeveloped tungsten assets, Woulfe’s flagship Sangdong mine. with our significant portfolio of producing assets that will create a truly global tungsten powerhouse to the benefit of both Almonty and Woulfe shareholders. We view this transaction as the first step in achieving our desired end result of combining the two companies. Almonty has already established itself as a leading producer of tungsten outside of China and premier consolidator of global tungsten assets. We are confident in the combined team’s ability to unlock significant value from our collective assets for our combined shareholders and see this transaction as a first step in achieving our original aim of combining the two companies. Almonty is also pleased to welcome Dundee as a significant shareholder (5.7% ownership interest post-closing) in the Company as a result of this transaction.

Click here to read the full Almonty Industries Inc. (TSXV:AII) press release.