Canada: Russell Breweries Inc. enters into letter of intent to acquire Fort Garry Brewing Company Ltd.

Russell Breweries Inc. ("Russell") is pleased to announce that it has entered into a Letter of Intent with Fort Garry Brewing Company Ltd. ("Fort Garry") to purchase the shares of Fort Garry through a Plan of Amalgamation, Russell Breweries said in its press release, May 28. Fort Garry is listed on the TSX Venture Exchange and has 4,976,698 common shares outstanding.

Terms of the Letter of Intent include the purchase of all outstanding common shares and preferred shares of Fort Garry. Common shareholders of Fort Garry will have the option to receive for each Fort Garry common share, either; (a) one common share of Russell; or (b) one half of one common share of Russell plus $0.20 cash; or (c) $0.40 cash. The preferred shareholders will be offered cash for the par value of their shares plus any accrued redemption premium and dividends. Russell and Fort Garry have agreed to complete due diligence and negotiate toward the signing of a Definitive Agreement within thirty days. Subject to the signing of the Definitive Agreement, the transaction is subject to Fort Garry shareholder approval and regulatory approval of the TSX Venture Exchange.

About Russell Brewing Company

Russell Brewing Company produces premium draught beer for fine pubs and eateries located in British Columbia. In 2006, Russell was recognized as BC's fastest growing brewery. Using all natural ingredients and traditional beer-making techniques, Russell beer is brewed for people who love beer. Products include: Russell Cream Ale, Russell Pale Ale, Russell Honey Blonde Ale, Russell Extra Special Lager plus two seasonal brews, Russell Lemon Ale and Russell Winter Porter. Russell Brewing Company is a wholly owned subsidiary of Russell Breweries Inc.

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