TORONTO, April 22 /CNW/ - J. David Mason, the Executive Chairman, founder, and largest individual shareholder of Augen Capital Corp. (TSX-V:AUG) announced today that he intends to nominate a slate of four independent directors to replace the existing Board of Directors at the Company's annual and special meeting, scheduled for May 29, 2008.

"Augen is currently handicapped by a dysfunctional Board of Directors that is failing to deliver value for shareholders," Mr. Mason said. "The activities of certain directors mean that Augen today is not the Company in which shareholders originally invested. To allow Augen to move forward, the group of directors led by George Elliott and Michel LeBel must be removed."

Mr. Mason intends to file and distribute a circular to Augen shareholders describing:

    <<     -   The failure of directors including Mr. Elliott and Mr. LeBel to         address the Company's expenses which is resulting in deteriorating         financial performance;      -   The loss of shareholder value under the Board as currently         constituted;      -   The recent significant breaches in corporate governance by the         current Board;      -   The results of Mr. Mason's original vision for Augen and the         demonstrated achievements of his strategy;      -   The plan to regain shareholder value that he will urge a new Board to         implement.     >> 

Since being first named to the Board in November 2006, George Elliott, the current interim CEO, has added personal allies such as Mr. LeBel as directors. These directors (the "Elliott-LeBel group") have exercised increasing influence over the Board and the Company.

Mr. Mason believes the Elliott-LeBel group has hampered the development of the Company and engaged in a series of unauthorized and questionable activities, while enriching themselves at the shareholders' expense.

Mr. Mason intends to distribute a Circular to Augen shareholders shortly and to file it on SEDAR. The Circular will provide full details of the nominees to the Board proposed by Mr. Mason, as well as the reasons and background to the solicitation of shareholder proxies for the annual and special meeting. Mr. Mason has engaged Laurel Hill Advisory Group to solicit proxies for the shareholder meeting.

Shareholders of Augen Capital will be asked to support the removal and replacement of the Elliott-LeBel group at the annual meeting for the following reasons:

Deteriorating Financial and Operating Performance

"Like other shareholders, I am disappointed by this Board's inability to deliver reasonable financial performance. It is not controlling costs while revenues have remained stagnant," Mr. Mason said.

    <<     -   Augen's expenses have risen with the growing influence of the         Elliott-LeBel group. Mr. Elliott was named Interim CEO to supervise         administrative and compliance matters and with an expected time         commitment of one day a week. His fees and expenses have increased         dramatically to more than $200,000 annually in the past year, despite         the Company's lack of revenue growth.      -   Mr. LeBel was an associate of Mr. Elliott's at Integrated Asset         Management Corp. and, at Mr. Elliott's urging, was named to Augen's         Board and named Lead Director, a Board position that is intended to         be independent of management. By the end of this month, Mr. LeBel         will have received more than $100,000 in Director's fees for less         than a year's association with Augen.      -   Mr. LeBel also chairs Augen's compensation committee which has         ignored the existing bonus formula based on return on equity and has         paid or proposed significant bonuses for Mr. LeBel and other         directors and officers.      -   Director Rhoderic Whyte, also closely allied with Mr. Elliott, has         incurred unnecessary expenses and fees of almost $150,000 in the past         year, including travel costs from the United Kingdom to attend Board         meetings in person at the insistence of Mr. Elliott. Previously, no         such costs were incurred.      -   The added costs generated by the Elliott-LeBel group were strongly         opposed by Mr. Mason who viewed them as inappropriate given the         Company's financial performance and declining share price. Mr.         Mason's efforts to control costs were rejected by the current Board.      Declining Shareholder Value      -   Since the appointment of George Elliott as Interim CEO in May 2007,         shareholders of Augen have seen the value of their investment decline         by 49%, from $0.47 per share to $0.24 per share as of April 18, 2008.      -   Over the same period the comparable TSX metals sub-index has gained         approximately 28%.      Significant Breaches in Corporate Governance      "George Elliott and his allies used corporate governance guidelines to separate the Chairman and CEO roles for their own advantage, but since then have actively subverted the intentions of good governance, resulting in weaker corporate performance and the disenfranchisement of shareholders," Mr. Mason said.      -   Without seeking authorization from the Board of Directors, in         December of 2007, George Elliott and Michel LeBel engaged law firm         Stikeman Elliott LLP to obtain advice on removing Mr. Mason as         Chairman of Augen. Stikeman Elliott withdrew from the engagement when         advised that it was not Board-sanctioned.      -   Also in December, 2007, the Board engaged law firm Cassels, Brock &         Blackwell LLP to investigate questions raised by Mr. Mason about         unauthorized outside business activities of an officer of the         Company.      -   Without seeking authorization from the Board as required, Mr. LeBel         unilaterally instructed Cassels Brock to shift the focus of the         investigation to the Executive Chairman. Subsequent to the shift in         focus, the officer who was the original subject of the investigation         made certain "counter-allegations" against Mr. Mason. These were not         articulated or presented to either David Mason or the full Board of         Directors.      -   The Elliott-LeBel group has orchestrated the withholding of         information from the full Board such as draft or final financial         reports for 2007 which are to be announced by the end of April.         Members of the Elliott-LeBel group established the record and meeting         dates of the Company's annual and special meeting without informing         the full Board, including the Chairman, Mr. Mason.      The Mason Track Record      -   After founding Augen in 1989, Mr. Mason grew the Company from         $1 million under management to approximately $60 million today and         annual revenues of $7.1 million in 2006, its last reported full         fiscal year.      -   From 2005 to 2007 Mr. Mason raised over $35 million in financing,         directly for Augen Capital and indirectly for its Limited         Partnerships.      -   Mr. Mason's responsibilities did not change when the Interim CEO         title was given to Mr. Elliott, but Mr. Mason's ability to complete         transactions on behalf of shareholders has been frustrated by the         maneuvering of the Elliott-LeBel group.      -   Prior to the appointment of Mr. Elliott as interim CEO in 2007, Mr.         Mason identified and negotiated the successful BluMont venture, which         increased the funds raised for limited partnerships from $15 million         to $50 million on an annualized basis. This venture is currently the         principal source of revenue for Augen.      The Mason Plan for Shareholder Value      As the Company's founder and architect of its successful business model, which among other achievements has made Augen one of the top three in Canada for flow-through portfolio performance, Mr. Mason will urge the new Board to return to this proven approach. Details of Mr. Mason's plan for enhanced shareholder value will be included in the his Circular. Highlights include:      -   Further development of the successful BluMont flow-through venture,         which has raised $35 million since September 2007, when it was         launched under the direction of Mr. Mason.      -   Continued seed capital financing of non-flow-through investments with         high potential returns. This business has led to the recent financing         and imminent listing of Augen Gold Corp as well as the Polar Bear         Project in Northern Ontario which is highly prospective for nickel,         other base metals and diamonds.      -   A return to financial discipline, controlling costs to ensure that         shareholders benefit fully from the returns on the company's         investments and financing activities.      A New Board Focused on Shareholders      -   The Elliott-LeBel group is not aligned with shareholder interests.         They collectively own less than 0.6% of Augen's outstanding shares.         Mr. Mason and related parties own more than 11% and he is fully         aligned with the interests of all shareholders.      -   Mr. Mason intends to nominate a new slate of experienced and         independent directors. These directors will provide expertise in         financing and investment in emerging resource companies, as well as a         focus on shareholder value that has not been demonstrated by the         Elliott-LeBel group.      -   These new independent Directors will oversee the implementation of         the plan proposed by Mr. Mason to return the Company to its         successful business model and to fair valuation by the market.      -   Mr. Mason has informed the nominee directors of his intention to         remain with Augen as the Company's senior executive.     >> 

Mason and Augen

Following a career with well-established mining companies and in investment banking J. David Mason, founded Augen Capital Corp. in 1989 and has served as Executive Chairman since its creation. He was also Chief Executive Officer from inception until May 2005.

Augen is a Toronto-based public merchant bank specializing in financing, and investing in, emerging resource companies. Augen manages a merchant banking hard dollar portfolio of emerging resource stocks including private companies.

Note

This press release is not, and is not to be construed to be, a solicitation of proxies. Solicitation of proxies will only be made by information circular to be sent to Augen's shareholders, Augen and Augen's auditors. The information circular will contain important detailed information about the solicitation of proxies, the upcoming shareholder meeting, the proposed slate of directors, Mr. Mason and Augen. Augen's shareholders should read the Mr. Mason's information circular before making any voting decision.

Forward Looking Statements

Except for historical information provided herein, this press release may contain information and statements of a forward-looking nature concerning the future performance of Augen. These statements are based on suppositions and uncertainties as well as on the best possible evaluation of future events. As a result, readers are advised that actual results may differ from expected results.