Augen Gold and Sanatana Diamonds Sign Joint Venture Agreement

Augen Gold Corp. (TSX VENTURE:GLD) has announced that it has entered into a definitive option and joint venture agreement with Sanatana Diamonds Inc., a company listed on the TSX Venture Exchange under the trading symbol STA, wherein Sanatana was granted an option to acquire up to 51% undivided interest in the rights to 46 mineral concessions in Ontario owned by Augen Gold along with a right of first refusal to acquire 9 mineral concessions in Ontario owned by Augen Gold.

The Claims and the ROFR Claims are located within the townships of Yeo, Chester, Neville and Benneweis in Ontario and total approximately 19,006 acres.

Pursuant to the terms of the Definitive Agreement, Sanatana will have an option to earn a 50% undivided interest in the Claims (the "50% Interest") by:

1. on or before the dates indicated below, making the following cash option payment and share issuances:

   1. paying to Augen Gold $150,000 within 10 days of applicable regulatory approval for the Definitive Agreement (the "Effective Date"),

   2. allotting and issuing to Augen Gold 2,000,000 shares in the capital of Sanatana, as fully paid and non-assessable, within 10 days of the Effective Date,

   3. allotting and issuing to Augen Gold a further 1,500,000 shares in the capital of Sanatana, as fully paid and non-assessable, on or before the first anniversary of the Effective Date,

   4. allotting and issuing to Augen Gold a further 1,500,000 shares in the capital of Sanatana, as fully paid and non-assessable, on or before the second anniversary of the Effective Date; and

2. on or before the dates indicated below, making the following exploration expenditures on the Claims (collectively, the "Expenditures"):

   1. $1,000,000 in exploration expenditures on or before the first anniversary of the Effective Date,

   2. a further $1,500,000 in exploration expenditures on or before the second anniversary of the Effective Date, and

   3. a further $2,500,000 in explorations expenditures on of before the third anniversary of the Effective Date.

Pursuant to the terms of the Definitive Agreement if Sanatana earns the 50% Interest in accordance with the provisions set forth above the parties will enter into a joint venture agreement with respect to the Claims. Sanatana will have the right to earn a further one percent (1%) interest (for a total interest of 51%) (the "51% Interest") in the Claims by completing and delivering to Augen Gold a pre-feasibility study on or before the fifth anniversary of the Effective Date. It is also a term of the Definitive Agreement that for as long as Sanatana and Augen Gold are parties to an option or joint venture with respect to the Claims or the ROFR Claims that Augen Gold will have the option to purchase up to 10% of any securities issued in any future equity offerings by Sanatana, on the same terms and conditions of such offering.

Closing of the Transaction is subject to Exchange approval. Third parties may receive a finder's fee in connection with the Transaction within the maximum amount permitted by the policies of the Exchange.

Source: Augen Gold Corp.