Garrison International Ltd.
TSX VENTURE : GAU

Garrison International Ltd.

September 05, 2007 16:13 ET

Garrison International Ltd. Obtains Funding of $550,000 Through Placement of Secured Convertible Debenture; Grants Options

TORONTO, ONTARIO--(Marketwire - Sept. 5, 2007) - Garrison International Ltd. (TSX VENTURE:GAU)) (the "Company") is pleased to announce that it has secured financing of $550,000 through the issuance of a Secured Convertible Debenture. Traders Group Limited ("Traders") is advancing $500,000 of the amount made available to the Company through this debenture, and Jia Yun International Investment Company Limited ("Jia Yun") is advancing the remaining $50,000. Traders is a Hong Kong based company that is wholly owned by Georges Haligua-Cohen, Chairman of the Board and a director of the Company. Kim Francois, another director of the Company, is Mr. Haligua-Cohen's spouse. Jia Yun is a Hong Kong company that is wholly owned by Blair Krueger, the Company's CEO and President and a director, and his spouse.

The debenture bears interest at 9.9% per annum and matures on August 14, 2008. In addition, all amounts due under the debenture are repayable if the Company obtains financing of at least $550,000 from another source, if the Company issues new shares other than pursuant to the exercise of outstanding warrants, options or convertible securities, upon the Company issuing warrants to other creditors or upon an event of default under the debenture. The debenture is convertible in full or in part into common shares of the Company at any time at the discretion of the debenture-holder. The conversion price applicable to a conversion of the debenture will be $0.121 per common share.

Prior to the Board reaching a determination as to the transactions effected through the debenture, both Mr. Krueger, Mr. Haligua-Cohen and Ms. Francois advised the Board of Directors of their interest in those transactions by virtue of their respective interests in Traders and Jia Yun. Each of them also abstained from the Board's decision with respect to the debenture. In considering the proposal to issue the debenture, the Board of Directors considered the Company's ability to quickly raise financing from other sources, the Company's anticipated capital requirements over the next three to six months and the fact that the interest rate on the debenture is competitive with, or lower than, the interest rate that would apply to loans from other sources. The conversion price of the debenture was arrived at using the average closing price for the Company's common shares for the ten trading days ending on August 10, 2007. The closing price for the Company's common shares on September 4, 2007, the day prior to this press release, was $0.105 per common share.

Under applicable securities regulations, no formal valuation is required to be obtained by management or the Board of Directors, nor is minority shareholder approval required, because, among other reasons, the amount advanced through the debenture represents approximately 8.3%, or less than 25%, of the Company's current market capitalization.

Prior to advancing the sum of $500,000 to the Company through the debenture, Traders owned 6,000,000 common shares of the Company, or 9.5% of the Company's outstanding common shares, as well as warrants exercisable for 2,500,000 common shares, which if exercised would cause Traders to own 12.9% of the Company's outstanding common shares. If Traders converts its entire interest in the debenture into common shares of the Company (assuming no interest or other charges accrue), it will receive 4,132,231 common shares (such that, assuming exercise of all warrants it holds, it would hold 12,632,231 common shares or approximately 18% of the Company's outstanding common shares).

Prior to advancing the sum of $50,000 to the Company through the debenture, Jia Yun owned 494,118 common shares of the Company, or 0.8% of the Company's outstanding common shares, as well as warrants exercisable for 294,118 common shares and options exercisable for an additional 780,000 common shares, which if exercised would cause Jia Yun to own 2.4% of the Company's outstanding common shares. If Jia Yun converts its entire interest in the debenture into common shares of the Company (assuming no interest or other charges accrue), it will receive 413,223 common shares (such that, assuming exercise of all warrants and options it holds, it would hold 1,981,459 common shares or approximately 3.1% of the Company's outstanding common shares).

The funds received by the Company through the issuance of the debenture will be used to continue its exploration and drilling programs currently underway on the Tovshiir property in Mongolia.

No finder's fee, broker's fee or other commission is payable in connection with the issuance of the debenture.

The issuance of the debenture is subject to approval of the TSX Venture Exchange.

The Company is also announcing that options to purchase a total of up to 1,500,000 of its common shares have been granted to directors and officers of the Company and/or its wholly owned subsidiary, Garrison Asia LLC. The options are exercisable at $0.121 per share and expire on September 4, 2012.

About the Company

Garrison is a junior mineral exploration company focused on acquiring and developing advanced stage gold properties in Mongolia, China and Guyana. For complete details on Garrison International Ltd. and its partners, management encourages investors and interested parties to view its public documents filed on SEDAR at www.sedar.com.

CAUTIONARY STATEMENT

All statements, other than statements of historical fact, in this news release are forward-looking statements that involve various risks and uncertainties, including, without limitation, statements regarding the future plans and objectives of Garrison International Ltd. There can be no assurance that such statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward-looking statements are based on the estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Garrison International Ltd. assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

Contact Information