Geoinformatics announces bridge loan, private placement and board restructuring

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UNITED STATES/

TORONTO, Aug. 18 /CNW/ - Geoinformatics Exploration Inc. (TSX-V: GXL.V) ("Geoinformatics" or the "Company") is pleased to announce that it has entered into binding agreements with Geologic Resource Partners LLC ("GRP") of Boston, Massachusetts with respect to (i) a Cdn$5.5 million short-term secured loan (the "Bridge Loan"), and (ii) a private placement of common shares at a price of Cdn$0.05 per share for gross proceeds of up to approximately Cdn$27 million (the "Private Placement").

GRP is the investment manager for several Geologic Resource funds (collectively, "GRF"), which currently hold 24,091,315 common shares of Geoinformatics (approximately 17.4% of the common shares outstanding).

Under the Bridge Loan, GRP has agreed to extend to the Company a Cdn$5.5 million bridge loan on a secured basis which the Company may draw down in tranches. Cdn$1.0 million will be made available to the Company immediately, a further Cdn$1.0 million will be available to the Company, subject to certain conditions, prior to the security being finalized, and the balance will be available to the Company upon execution of loan and security documents, receipt of any necessary regulatory approvals, and satisfaction of certain other conditions. Advances under the Bridge Loan will bear interest at a rate equal to 12% per annum. The Bridge Loan will mature on March 2, 2009, subject to GRP's right to accelerate repayment in the event of a default under the loan. As security for the Bridge Loan, the Company has agreed to pledge all of the shares of its material subsidiaries. Advances under the Bridge Loan shall be used by the Company to fund its ongoing exploration activities and for general working capital.

Under the Private Placement, GRP has agreed to subscribe for common shares of the Company at a subscription price of Cdn$0.05 per share for an aggregate subscription amount equal to the sum of the Canadian dollar equivalent of $US20.0 million (to be determined as of two business days prior to closing of the Private Placement) plus Cdn$5.5 million. Based on a Cdn/US exchange rate of $1.062, GRP would subscribe for 534,800,000 common shares of the Company, and upon completion of the Private Placement, GRF would hold 558,891,315 common shares of the Company, representing approximately 83% of the outstanding shares of the Company. Proceeds from the Private Placement will be used (i) to repay the entire principal amount of the Company's outstanding US$20 million secured debentures held by GRF, (ii) to repay amounts drawn under the Bridge Loan, (iii) to advance the Company's Whistler Project, and (iv) for working capital.

The Bridge Loan constitutes a "related party transaction" for the Company but is exempt from the formal valuation requirement of securities laws as the Company's common shares are listed only on the TSX-V. The Bridge Loan is exempt from the minority shareholder approval requirement of securities laws as amounts due under the Bridge Loan are not convertible into or repayable in common shares of the Company and the terms of the Bridge Loan are commercially reasonable and not less advantageous to the Company compared to if the loan were to be obtained from an arm's length party.

The Private Placement requires shareholder approval under the policies of the TSX-V. In addition, since the Private Placement constitutes a "related party transaction", minority shareholders of Geoinformatics, specifically shareholders other than GRF, must also approve the Private Placement. The Company intends to call and hold a special meeting of shareholders in October 2008 (the "Meeting") for the purpose of seeking approval of the Private Placement. The Private Placement, like the Bridge Loan, is exempt from the formal valuation requirement of securities laws as the Company's common shares are listed only on the TSX-V.

At the Meeting, shareholders will also be asked to re-approve a consolidation of the Company's common shares on the basis of one new common share for each ten existing common shares. After closing of the Private Placement and consolidation of the Company's common shares, the Company will have approximately 67.3 million shares outstanding.

Closing of the Private Placement is conditional upon shareholder approval (as described above); shareholder approval of the share consolidation, TSX-V approval, execution of amended employment agreements with key management personnel of the Company and other conditions typical of such private placements.

The Company is also pleased to announce the appointment of George R. Ireland and Peter Stein to the Board of Directors of the Company. Mr. Kevin L. Snook, Chairman, has retired from the Board and Mr. John Kanellitsas has been appointed as his successor as Chairman. The Board of Directors and management would like to extend their sincere thanks and appreciation to Mr. Snook for his dedication to and support of the Company over the years.

The Board of Geoinformatics now consists of Dr. Michael Etheridge, an independent director who has served on the Company's Board for the past 3 years, Mr. Peter Stein, an independent director, Mr. George Ireland, Chief Investment Officer of GRF, Mr. John Kanellitsas, Chief Operating Officer of GRF, and Ms. Rosie Moore, a consultant to GRF.

About Geoinformatics

Geoinformatics is a North American-focused minerals exploration company which has developed a unique approach to exploration applying innovative and proprietary technology.

The Company announced an independent NI 43-101-compliant mineral resource estimate with an Indicated Resource of 840,000 ounces of gold and an Inferred Resource of 2.7 million ounces on the initial discovery zone at the Whistler Project in southern Alaska. The Indicated category contains 30 million tonnes grading 0.87 g/t gold, 2.46 g/t silver and 0.24% copper and the Inferred category contains 155 million tonnes grading 0.62 g/t gold, 2.15 g/t silver and 0.19% copper. Significant copper and silver mineralization increases the Indicated gold-equivalent mineral resource to 1.3 million ounces and the Inferred mineral resource to 4.4 million ounces.

Geoinformatics is also exploring several advanced projects located in Sinaloa (Mexico), Utah, the Cortez Trend region of Nevada, and British Columbia. Geoinformatics has an extensive portfolio of other direct and indirect property interests, joint ventures, and royalties covering a wide range of minerals in Mexico, Australia, New Zealand and North America.

About Geologic Resource Partners

Geologic Resource Partners, LLC is a Boston-based institutional money management firm specializing in metals and mining investments. GRP invests on a global basis in publicly-listed equities of companies with small and micro market capitalizations. The Chief Investment Officer and Portfolio Manager of GRP is George R. Ireland.

This news release includes certain forward-looking statements concerning the future performance of Geoinformatics' business, operations and financial performance and condition, as well as management's objectives, strategies, beliefs and intentions, including in respect of its intent to finalize a private placement and loan arrangement with GRP. Forward-looking statements are frequently identified by such words as "may", "will", "plan", "expect", "anticipate", "estimate", "intend" and similar words referring to future events and results. Forward-looking statements are based on the current opinions and expectations of management. All forward-looking information is inherently uncertain and subject to a variety of assumptions, risks and uncertainties, including the speculative nature of mineral exploration and development, fluctuating commodity prices, competitive risks and the availability of financing, as described in more detail in our recent securities filings available at www.sedar.com. Actual events or results may differ materially from those projected in the forward looking-statements and Geoinformatics cautions against placing undue reliance thereon. Neither Geoinformatics nor its management assumes any obligation to revise or update these forward-looking statements.

The TSX Venture Exchange does not accept responsibility for the adequacy

or accuracy of this release.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Contacts

Ms. Petra Decher
President and Chief Financial Officer
Tel: (416) 861-1300 x225
Email: petrad@geoinformex.com

Mr. Darren Holden
Chief Operating Officer
Tel: (604) 605-3073 x105
Email: darrenh@geoinformex.com

Mr. John Kanellitsas
Chairman
Tel: (208) 726-0079
Email: jkanellitsas@grfunds.com

Geoinformatics Exploration Inc.
330 Bay Street
Suite 1109
Toronto
Ontario
M5H 2S8
www.geoinformex.com