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Augusta Resource Corp – ‘40FR12B’ on 7/13/06 – ‘EX-99.13’

On:  Thursday, 7/13/06, at 5:59pm ET   ·   As of:  7/14/06   ·   Accession #:  1062993-6-2010   ·   File #:  1-32943

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  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 7/14/06  Augusta Resource Corp             40FR12B     7/13/06   61:4.7M                                   Newsfile Corp/FA

Document/Exhibit                   Description                      Pages   Size 

 1: 40FR12B     Registration Statement                              HTML     69K 
 2: EX-99.1     Annual Information Form for the Year Ended          HTML    180K 
                          December 31, 2005                                      
11: EX-99.10    MD&A for the Six Months Ended June 30, 2005         HTML    120K 
12: EX-99.11    First Quarter Report                                HTML    144K 
13: EX-99.12    MD&A for the Three Months Ended March 31, 2005      HTML     80K 
14: EX-99.13    Management Information Circular                     HTML    129K 
15: EX-99.14    Form of Proxy                                       HTML     34K 
16: EX-99.15    Preliminary Assessment and Economic Evaluation      HTML    373K 
17: EX-99.16    Mineral Resource Estimate                           HTML    257K 
18: EX-99.17    News Release Dated June 30, 2006                    HTML     27K 
19: EX-99.18    Material Change Report Dated June 26, 2006          HTML     22K 
20: EX-99.19    Material Change Report Dated June 14, 2006          HTML     48K 
 3: EX-99.2     Annual Information Form for the Year Ended          HTML    254K 
                          December 31, 2004                                      
21: EX-99.20    Material Change Report Dated June 5, 2006           HTML     21K 
22: EX-99.21    Material Change Report Dated June 2, 2006           HTML     19K 
23: EX-99.22    Material Change Report Dated May 18, 2006           HTML     25K 
24: EX-99.23    Material Change Report Dated May 5, 2006            HTML     26K 
25: EX-99.24    Material Change Report Dated April 27, 2006         HTML     19K 
26: EX-99.25    Material Change Report Dated April 11, 2006         HTML     18K 
27: EX-99.26    Material Change Report Dated April 7, 2006          HTML     26K 
28: EX-99.27    Material Change Report Dated March 17, 2006         HTML     23K 
29: EX-99.28    Material Change Report Dated March 6, 2006          HTML     20K 
30: EX-99.29    Material Change Report Dated February 16, 2006      HTML     23K 
 4: EX-99.3     Audited Annual Financial Statements                 HTML    534K 
31: EX-99.30    Material Change Report Dated January 26, 2006       HTML     31K 
32: EX-99.31    Material Change Report Dated January 16, 2006       HTML     26K 
33: EX-99.32    Material Change Report Dated January 16, 2006       HTML     30K 
34: EX-99.33    Material Change Report Dated November 22, 2005      HTML     21K 
35: EX-99.34    Material Change Report Dated November 11, 2005      HTML     28K 
36: EX-99.35    Material Change Report Dated October 13, 2005       HTML     26K 
37: EX-99.36    Material Change Report Dated September 29, 2005     HTML     22K 
38: EX-99.37    Material Change Report Dated September 20, 2005     HTML     20K 
39: EX-99.38    News Release Dated September 9, 2005                HTML     18K 
40: EX-99.39    News Release Dated August 25, 2005                  HTML     21K 
 5: EX-99.4     MD&A for the Years Ended December 31, 2005 and      HTML    169K 
                          2004                                                   
41: EX-99.40    Material Change Report Dated August 25, 2005        HTML     18K 
42: EX-99.41    Material Change Report Dated July 12, 2005          HTML     23K 
43: EX-99.42    Material Change Report Dated July 5, 2005           HTML     20K 
44: EX-99.43    News Release Dated June 23, 2005                    HTML     20K 
45: EX-99.44    Material Change Report Dated June 14, 2005          HTML     20K 
46: EX-99.45    News Release Dated June 9, 2005                     HTML     19K 
47: EX-99.46    Material Change Report Dated June 8, 2005           HTML     27K 
48: EX-99.47    Material Change Report Dated May 13, 2005           HTML     23K 
49: EX-99.48    Material Change Report Dated May 13, 2005           HTML     22K 
50: EX-99.49    Material Change Report Dated March 29, 2005         HTML     21K 
 6: EX-99.5     First Quarter Report                                HTML    198K 
51: EX-99.50    Material Change Report Dated March 4, 2005          HTML     22K 
52: EX-99.51    News Release Dated March 4, 2005                    HTML     24K 
53: EX-99.52    News Release Dated March 1, 2005                    HTML     26K 
54: EX-99.53    News Release Dated February 17, 2005                HTML     18K 
55: EX-99.54    News Release Dated February 11, 2005                HTML     18K 
56: EX-99.55    News Release Dated February 8, 2005                 HTML     21K 
57: EX-99.56    Material Change Report Dated January 27, 2005       HTML     22K 
58: EX-99.57    Consent of Expert in Connection With the Paee       HTML     18K 
                          Report                                                 
59: EX-99.58    Consent of Expert in Connection With the Rosemont   HTML     18K 
                          Property Report                                        
60: EX-99.59    Auditor's Consent (Ernst & Young LLP)               HTML     17K 
 7: EX-99.6     MD&A for the Three Months Ended March 31, 2006      HTML     99K 
61: EX-99.60    Auditor's Consent (Deloitte & Touche LLP)           HTML     17K 
 8: EX-99.7     Third Quarter Report                                HTML    244K 
 9: EX-99.8     MD&A for the Nine Months Ended September 30, 2005   HTML    135K 
10: EX-99.9     Second Quarter Report                               HTML    239K 

AUGUSTA RESOURCE CORPORATION
Suite 400, 837 West Hastings Street
Vancouver, British Columbia V6C 3N6

INFORMATION CIRCULAR

INFORMATION PROVIDED AS AT APRIL 17, 2006 (unless otherwise stated) FOR THE
ANNUAL GENERAL AND SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON
MAY 18, 2006.

PERSONS MAKING THE SOLICITATION

This Information Circular is furnished in connection with the solicitation of proxies being made by the management of Augusta Resource Corporation (the "Corporation") for use at the Annual and Special Meeting of the Corporation’s shareholders (the "Meeting") to be held on Thursday, May 18, 2006 at the time and place and for the purposes set forth in the accompanying Notice of Meeting. While it is expected that the solicitation will be made primarily by mail, proxies may be solicited personally or by telephone by directors, officers and employees of the Corporation. All costs of this solicitation will be borne by the Corporation.

APPOINTMENT OF PROXIES

The individuals named as proxyholder in the accompanying form of proxy are the President and Secretary of the Corporation. A SHAREHOLDER WISHING TO APPOINT SOME OTHER PERSON (WHO NEED NOT BE A SHAREHOLDER) TO REPRESENT HIM AT THE MEETING HAS THE RIGHT TO DO SO, EITHER BY STROKING OUT THE NAMES OF THOSE PERSONS NAMED IN THE ACCOMPANYING FORM OF PROXY AND INSERTING THE DESIRED PERSON’S NAME IN THE BLANK SPACE PROVIDED IN THE FORM OF PROXY OR BY COMPLETING ANOTHER FORM OF PROXY. A proxy will not be valid unless the completed form of proxy is received by Computershare Trust Company of Canada, Proxy Department, 100 University Avenue, 9^th Floor, Toronto, Ontario M5J 2Y1, not less than 48 hours (excluding Saturdays, Sundays and holidays) before the time for holding the Meeting or any adjournment thereof. Proxies delivered after that time will not be accepted.

NON-REGISTERED HOLDERS

Only registered shareholders or duly appointed proxyholders are permitted to vote at the Meeting. Most shareholders of the Corporation are “non-registered” shareholders because the shares they own are not registered in their names but are instead registered in the names of a brokerage firm, bank or other intermediary or in the name of a clearing agency. Shareholders who do not hold their shares in their own name (referred to herein as “Beneficial Shareholders”) should note that only registered shareholders may vote at the Meeting. If common shares are listed in an account statement provided to a shareholder by a broker, then in almost all cases those common shares will not be registered in such shareholder’s name on the records of the Corporation. Such common shares will more likely be registered under the name of the shareholder’s broker or an agent of that broker. In Canada, the vast majority of such shares are registered under the name of CDS & Co. (the registration name for The Canadian Depository for Securities, which company acts as nominee for many Canadian brokerage firms). Common shares held by brokers (or their agents or nominees) on behalf of a broker’s client can only be voted (for or against resolutions) at the direction of the Beneficial Shareholder. Without specific instructions, brokers and their agents and nominees are prohibited from voting shares for the brokers’ clients.

Therefore, each Beneficial Shareholder should ensure that voting instructions are communicated to the appropriate person well in advance of the Meeting.

Existing regulatory policy requires brokers and other intermediaries to seek voting instructions from Beneficial Shareholders in advance of shareholders’ meetings. The various brokers and other intermediaries have their own mailing procedures and provide their own return instructions to clients, which should be carefully followed by Beneficial Shareholders in order to ensure that their common shares are voted at the Meeting. Often the form of proxy supplied to a Beneficial Shareholder by its broker is identical to the form of proxy provided by the Corporation to the registered shareholders. However, its purpose is limited to instructing the registered shareholder (i.e., the broker or agent of the

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broker) how to vote on behalf of the Beneficial Shareholder. The majority of brokers now delegate responsibility for obtaining instructions from clients to ADP Investor Communications Services (“ADP”). ADP typically prepares a machine-readable voting instruction form, mails those forms to the Beneficial Shareholders and asks Beneficial Shareholders to return the forms to ADP, or otherwise communicate voting instructions to ADP (by way of the internet or telephone, for example). ADP then tabulates the results of all instructions received and provides appropriate instructions respecting the voting of common shares to be represented at the Meeting. A Beneficial Shareholder who receives an ADP voting instruction form cannot use that form to vote common shares directly at the Meeting. The voting instruction form must be returned to ADP (or instructions respecting the voting of common shares must be communicated to ADP) well in advance of the Meeting in order to have the common shares voted.

This Information Circular and accompanying materials are being sent to both registered shareholders and Beneficial Shareholders. Beneficial Shareholders fall into two categories – those who object to their identity being known to the issuers of securities which they own (“Objecting Beneficial Owners”, or “OBOs”) and those who do not object to their identity being made known to the issuers of the securities they own (“Non-Objecting Beneficial Owners”, or “NOBOs”). Subject to the provision of National Instrument 54-101 – Communication with Beneficial Owners of Securities of Reporting Issuers (“NI 54-101”) issuers may request and obtain a list of their NOBOs from intermediaries via their transfer agents. If you are a Beneficial Shareholder, and the Corporation or its agent has sent these materials directly to you, your name, address and information about your holdings of common shares have been obtained in accordance with applicable securities regulatory requirements from the intermediary holding the common shares on your behalf.

The Corporation’s OBOs can expect to be contacted by ADP or their brokers or their broker’s agents as set out above.

Although Beneficial Shareholders may not be recognized directly at the Meeting for the purposes of voting common shares registered in the name of his broker, a Beneficial Shareholder may attend the Meeting as proxyholder for the registered shareholder and vote the common shares in that capacity. Beneficial shareholders who wish to attend the Meeting and indirectly vote their common shares as proxyholder for the registered shareholder should enter their own names in the blank space on the proxy provided to them and return the same to their broker (or the broker’s agent) in accordance with the instructions provided by such broker.

All references to shareholders in this Information Circular, the accompanying form of proxy and Notice of Annual and Special Meeting of Shareholders are to registered shareholders of record unless specifically stated otherwise.

REVOCATION OF PROXIES

A shareholder who has given a proxy may revoke it by an instrument in writing executed by the shareholder or by the shareholder’s attorney authorized in writing or, if the shareholder is a corporation, by a duly authorized officer or attorney of the corporation, and delivered either to the registered office of the Corporation, at Suite 2300 – Four Bentall Centre, 1055 Dunsmuir Street, Vancouver, BC, V7X 1J1, at any time up to and including the last business day preceding the day of the Meeting or any adjournment of it, or to the chair of the Meeting on the day of the Meeting or any adjournment of it. A revocation of a proxy does not affect any matter on which a vote has been taken prior to the revocation.

VOTING OF PROXIES

The shares represented by a properly executed proxy in favour of persons designated as proxyholders in the enclosed form of proxy will:

The enclosed form of proxy, when properly completed and delivered and not revoked, confers discretionary authority upon the person appointed proxyholder thereunder to vote with respect to amendments or variations of matters identified in the Notice of Annual and Special Meeting of Shareholders, and with respect to other matters which may properly come before the Meeting. In the event that amendments or variations to matters identified in the Notice of Annual and Special Meeting of Shareholders are properly brought before the Meeting or any further or other business is properly brought

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before the Meeting, it is the intention of the persons designated by management as proxyholders in the enclosed form of proxy to vote in accordance with their best judgment on such matters or business. At the time of the printing of this Information Circular, the management of the Corporation knows of no such amendment, variation or other matter which may be presented to the Meeting.

VOTING SHARES AND PRINCIPAL HOLDERS THEREOF

The directors of the Corporation have set April 17, 2006 as the record date (the “Record Date”) for determining which shareholders shall be entitled to receive notice of and to vote at the Meeting. Advance notice of the record date for the Meeting was published by CDS Inc. in The Globe & Mail on March 25, 2006.

As at the Record Date, there were a total of 40,456,680 common shares (the "common shares") outstanding. Each common share entitles the shareholder(s) thereof to one vote for each common share shown as registered in the shareholders' name on the record date. Only shareholders of record holding common shares at the close of business who either personally attend the meeting or who have completed and delivered a form of proxy in the manner and subject to the provisions described above shall be entitled to vote or to have their shares voted at the Meeting.

On a show of hands, every individual who is present and is entitled to vote as a shareholder or as a representative of one or more corporate shareholders, or who is holding a valid proxy on behalf of a shareholder who is not present at the Meeting, will have one vote, and on a poll every shareholder present in person or represented by a valid proxy and every person who is a representative of one or more corporate shareholders, will have one vote for each share registered in that shareholder’s name on the list of shareholders, which is available for inspection during normal business hours at Computershare Trust Company of Canada and will be available at the Meeting. Shareholders represented by proxy holders are not entitled to vote on a show of hands.

To the knowledge of the directors and senior officers of the Corporation, the only person or company who beneficially owns, directly or indirectly, or exercises control or direction over, shares carrying more than 10% of the voting rights attached to all outstanding shares of the Corporation as of the close of business on April 17, 2006 is as follows:

(1) Beneficial owners of these shares are not known by the Corporation.
(2) A majority of these shares are registered in the name of a brokerage firm and 5,153,767 are beneficially held by Augusta Capital Corporation, a company 100% owned by Richard W. Warke.

ELECTION OF DIRECTORS

There are currently seven directors of the Corporation. The present term of office of each of these seven directors will expire immediately prior to the election of directors at the Meeting. It is proposed that the seven persons named below be nominated for election as directors of the Corporation. Management of the Corporation does not contemplate that any of the nominees will be unable to serve as directors. Each director will hold office until the next annual meeting of the Corporation or until his successor is appointed or elected, unless his office is earlier vacated in accordance with the ByLaws of the Corporation or with the provisions of the Canada Business Corporations Act.

In the following table and notes thereto is stated the name of each person proposed to be nominated by management for election as a director, the country in which he is ordinarily resident, all offices of the Corporation now held by him, his principal occupation, the period of time for which he has been a director of the Corporation and the number of common shares beneficially owned by him, directly or indirectly, or over which he exercises control or direction, as at the date hereof.

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CORPORATE CEASE TRADE ORDERS OR BANKRUPTCIES

No director, or proposed management nominee for election as a director of the Corporation is, or has been within the 10 years before the date of this Information Circular, a director or executive officer of any other company that, while that person was acting in that capacity,

Richard W. Warke, the Chairman of the Corporation, is the President and Director of Cybercom Systems Inc. (“Cybercom”) and Donald B. Clark, Chief Financial Officer of the Corporation, is a Director of Cybercom. Cybercom was issued a cease trade order on October 23, 2002 due to failure to file comparative annual financial statements and quarterly report for the period ended January 31, 2002. Cybercom’s failure to filing the above resulted from its inability to pay filing fees associating with such filing due to a lack of funding. Cybercom is currently inactive and remains under cease trade order. In addition, 2973090 Canada Inc., a Quebec based company, filed a motion with the Quebec Court dated August 18, 1997 to petition Cybercom (Augusta Metals Incorporated at the time) into bankruptcy. The case was heard November 5, 1997. The Court rendered judgement January 19, 1998, dismissing the plaintiff’s motion.

Personal Bankruptcies

Other than as described below, no director of the Corporation, or proposed management nominee for election as a director of the Corporation, or a personal holding company of any such persons has, within the 10 years before the date of this Information Circular, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or was subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of that individual except as follows:

Richard Warke, Chairman of the Corporation, filed a proposal (the “Proposal”) with the Official Receiver under the Bankruptcy and Insolvency Act on September 15, 1998. Despite filing the Proposal, by letter dated August 7, 2002 the TSX Venture Exchange confirmed that Mr. Warke is acceptable to act as a director of the Corporation.

STATEMENT OF EXECUTIVE COMPENSATION

The following table sets forth all annual and long-term compensation awarded, paid to or earned for services in all capacities to the Corporation for the fiscal year ended December 31, 2005 for the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) of the Corporation, regardless of the amount of compensation paid to those individuals, and each of the Corporation's three mo st highly compensated executive officers, other than the CEO and CFO, who were serving as executive officers at the end of the most recent fiscal year, provided that disclosure is not required for an

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executive officer whose total salary and bonus does not exceed $150,000 (the "Named Executive Officer(s)"). During the Corporation's fiscal year ended December 31, 2005, the Corporation had three Named Executive Officers, Richard W. Warke, currently Chairman (formerly President and Chief Executive Officer until April 18, 2005), Gil Clausen, President and CEO of the Corporation (since April 18, 2005) and Donald B. Clark, Chief Financial Officer of the Corporation.

Summary Compensation Table

Long Term Incentive Plan Awards

Long term incentive plan awards ("LTIP") means "any plan providing compensation intended to serve as an incentive for performance to occur over a period longer than one financial year whether performance is measured by reference to financial performance of the Corporation or an affiliate, or the price of the Corporation's shares but does not include option or stock appreciation rights plans or plans for compensation through restricted shares or units". The Corporation has not granted any LTIP's to the Named Executive Officers during the past fiscal year.

Options and Stock Appreciation Rights

During the most recently completed financial year, the following stock options were granted to the Named Executive Officers:

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Stock appreciation rights ("SAR's") means a right, granted by a Corporation or any of its subsidiaries as compensation for services rendered or in connection with office or employment, to receive a payment of cash or an issue or transfer of securities based wholly or in part on changes in the trading price of the Corporation's shares. No SAR's were granted to or exercised by the Named Executive Officers during the past fiscal year.

Aggregated Options/SARS Exercises During the Most Recently Completed Financial Year and Financial Year-End Option/SAR Values

As no incentive stock options were exercised by the Named Executive Officers during the past fiscal year, the following table sets forth details of the value of the Named Executive Officers’ unexercised options on an aggregated bases as at the year end.

Options and SARS Repricing

During the fiscal year ending December 31, 2005, the Corporation did not reprice downward stock options or SARS held by the Named Executive Officers or by any of the Directors, Officers and employees of the Corporation.

Pension Plans

The Corporation does not provide retirement benefits for its directors or executive officers.

Termination of Employment, Change in Responsibilities and Employment Contracts

The Corporation currently has the following arrangements in place with respect to remuneration received or that may be received by the Named Executive Officers or directors and officers of the Corporation in respect of compensating such director or officer in the event of termination of employment (as a result of resignation, retirement, change of control, etc.) or a change in responsibilities following a change of control, where the value of such compensation exceeds $100,000 per officer or director (any capitalized terms not already defined shall take the definition ascribed to them in their respective individual agreements):

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Composition of the Compensation Committee

The Corporation appointed a Compensation Committee for the first time in 2005. The Compensation Committee is comprised of four independent directors (as that term is defined in Multilateral Instrument 52-110), Robert P. Wares, Michael A. Steeves, Chrisopher M. H. Jennings and W. Durand Eppler. The purpose of the Compensation Committee is to review and recommend compensation policies and programs to the Corporation as well as salary and benefit levels for its executives. The objective of the Committee is to assist in attracting, retaining and motivating executives and key personnel in view of the Corporation’s goals.

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Report on Executive Compensation

To ensure that the Corporation will continue to attract and retain qualified and experienced executives, base salaries are reviewed and adjusted annually, in order to ensure that they remain at a level at or above the median for comparable companies. Bonuses are based upon a combination of individual and the Corporation’s performance and are weighted more against the Corporation’s performance for senior executives. For the fiscal year ending December 31, 2005 the Compensation Committee of the Board recommended to the Board of Directors a compensation package for the Corporation’s directors and executive officers including the payment of a bonus to each of its Named Executive Officers. The Board of directors approved and accepted this compensation package. Details of compensation paid to the Named Executive Officers for the fiscal year ending December 31, 2005, is provided under “Statement of Executive Compensation” above including the payment by the Corporation of a bonus to the Chairman in the amount of $150,000 cash, the President and CEO in the amount of US$155,833 cash and the CFO in the amount of $56,250 cash. In addition, certain employment contracts were amended taking into consideration the recommendations of the Compensation Committee as approved by the Board of Directors. Details are provided under “Termination of Employment, Change in Responsibilities and Employment Contracts”.

Compensation of Directors

Effective April 2006, directors of the Corporation who are not employees of the Corporation (“Independent Director(s)”) are paid a quarterly retainer of $2,000 and a meeting attendance fee of $200 for each Board meeting attended in person or by telephone. An Independent Director who serves as Chair of any committee of the Board of Directors is paid an additional fee ($300 per quarter to the Chair of the Audit Committee and $200 per quarter to the Chair of the Corporate Governance Committee). In addition, an Independent Director who is a member of any committee is paid $150 per quarter per Committee. All reasonable expenses incurred by a director in attending meetings of the Board of Directors, committee meetings or shareholder meetings, together with all expenses properly and reasonably incurred by any director in the conduct of the Corporation’s business or in the discharge of his duties as a director are paid by the Corporation. In addition each Independent Director is to be granted 50,000 stock options on an annual basis in accordance with the Corporation’s stock option plan.

As at December 31, 2005, Directors and Officers who are not Named Executive Officers, held as a group, an aggregate of 975,000 stock options having an exercise price between $0.10 and $2.30 and expiring between December 5, 2006 and September 28, 2010. The following table sets forth particulars of stock options granted to the Corporation’s directors who are not Named Executive Officers during the fiscal year ended December 31, 2005:

During the fiscal year ending December 31, 2005, a total of 108,333 stock options having an exercise price between $0.10 and $0.30 were exercised by a director of the Corporation.

INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS

During the Corporation's past fiscal year, no director, executive officer or senior officer of the Corporation, proposed management nominee for election as a director of the Corporation or associate or affiliate of any such director, executive or senior officer or proposed nominee is or has been indebted to the Corporation or any of its subsidiaries or is or has been indebted to another entity where such indebtedness is or has been the subject of a guarantee, support agreement, letter of credit or other similar arrangement or understanding provided by the Corporation or any of its subsidiaries, other than routine indebtedness.

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INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS

Other than as set forth above or elsewhere in this Information Circular and other than transactions carried out in the ordinary course of business of the Corporation or any of its subsidiaries, no informed person or proposed director of the Corporation and no associate or affiliate of the foregoing persons has or has had any material interest, direct or indirect, in any transaction since the commencement of the Corporation’s most recently completed financial year or in any proposed transaction which in either of such cases has materially affected or would materially affect the Corporation or any of its subsidiaries.

STATEMENT OF CORPORATE GOVERNANCE PRACTICE

The British Columbia Securities Commission has issued guidelines on corporate governance disclosure for venture issuers as set out in Form 58-101F2 and requires full and complete annual disclosure of listed companies systems of corporate governance with reference to each of such guidelines (the “Guidelines”). Where a company’s corporate governance system differs from the Guidelines, each difference and the reason for the difference is required to be disclosed. The Corporation’s approach to corporate governance is set out in the attached Schedule “A”.

APPOINTMENT OF AUDITORS

Unless such authority is withheld, the persons named in the accompanying proxy intend to vote for the appointment of Ernst & Young LLP, Chartered Accountants, as auditors of the Corporation and to authorize the directors to fix their remuneration.

In accordance with Section 4.11, “Change of Auditor”, of National Instrument 51-102, “Continuous Disclosure Obligations”, attached to this Circular as Schedule “B” is a Notice of Change of Auditor advising that the Corporation appointed Ernst & Young LLP, Chartered Accountants, as auditors of the Corporation effective January 5, 2006 for the ensuing year. The Notice of Change of Auditor states that there have been no reservations in the auditor’s reports for the two most recently completed fiscal year ends nor have there been any reportable events. The recommendation to appoint Ernst & Young LLP to fill the vacancy in the position of auditor was approved by the Audit Committee and the Board of Directors of the Corporation. Letters from Deloitte & Touch LLP and Ernst & Young LLP confirming their agreement with the Notice of Change of Auditor are attached to the Notice of Change of Auditor in Schedule “B”.

MANAGEMENT CONTRACTS

A private British Columbia company, in which the Chairman has a 25% interest, received the sum of $30,000 in consideration for providing administrative services to the Corporation for the fiscal year ended December 31, 2005.

AUDIT COMMITTEE

Multilateral Instrument 52-110 of the Canadian Securities Administrators (“MI 52-110”) requires the Corporation, as a venture issuer, to disclose annually in its Information Circular certain information concerning the constitution of its audit committee and its relationship with its independent auditors, as set forth in the following.

The Corporation’s audit committee is governed by an audit committee charter, the text of which is attached as Schedule “C” to this Circular.

The Corporation’s audit committee is comprised of five directors, Christopher M. H. Jennings, Robert Wares, Michael A. Steeves, W. Durand Eppler and Donald Clark. As defined in MI 52-110, all but one director, Mr. Donald B. Clark, are “independent”. Also as defined in MI 52-110, all of the audit committee members are “financially literate”.

Since the commencement of the Corporation’s most recently completed financial year, the Corporation’s Board of Directors has not failed to adopt a recommendation of the audit committee to nominate or compensate an external auditor.

Since the effective date of MI 52-110, the Corporation has not relied on the exemptions contained in sections 2.4 or 8 of MI 52-110. Section 2.4 provides an exemption from the requirement that the audit committee must pre-approve all nonaudit

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services to be provided by the external auditors, where the total amount of fees related to the non-audit services are not expected to exceed 5% of the total fees payable to the external auditors in the fiscal year in which the non-audit services were provided. Section 8 permits a Corporation to apply to a securities regulatory authority for an exemption from the requirements of MI 52-110, in whole or in part.

The audit committee must pre-approve any engagement of the external auditors for any non-audit services to the Corporation in accordance with applicable law and policies and procedures to be approved by the Board. The engagement of non-audit services will be considered by the Corporation’s Board of Directors, and where applicable the audit committee, on a case-by-case basis.

In the following table, “audit fees” are fees billed by the Corporation’s external auditors for services provided in auditing the Corporation’s annual financial statements for the subject year. “Audit-related fees” are fees not included in audit fees that are billed by the auditors for assurance and related services that are reasonably related to the performance of the audit or review of the Corporation’s financial statements. “Tax fees” are fees billed by the auditors for professional services rendered for tax compliance, tax advice and tax planning. “All other fees” are fees billed by the auditors for products and services not included in the foregoing categories.

The fees paid by the Corporation to its auditors in each of the last two fiscal years, by category, are as follows:

The Corporation is relying on the exemption provided by section 6.1 of MI 52-110 which provides that the Corporation, as a Venture Issuer, is not required to comply with Part 3 (Composition of the Audit Committee) and Part 5 (Reporting Obligations) of MI 52-110.

INTEREST OF CERTAIN PERSON IN MATTERS TO BE ACTED UPON

No person who has been a director or executive officer of the Corporation at any time since the beginning of the last financial year, nor any proposed nominee for election as a director of the Corporation, nor any associate or affiliate of any of the foregoing, has any material interest directly or indirectly, by way of beneficial ownership of securities or otherwise, in any matter to be acted upon at the Meeting except with respect to grants of stock options pursuant to the Corporation’s stock option plan and the issuance of bonuses by the Corporation to its executive officers pursuant to their respective employment contracts.

PARTICULARS OF OTHER MATTERS TO BE ACTED UPON

Stock Option Plan

The policies of the TSX Venture Exchange (“Exchange”) require that all listed companies adopt either a “rolling” stock option plan or a “fixed number” stock option plan and thereafter grant all stock options pursuant to the plan. On May 3, 2004, the Board adopted an updated Stock Option Plan (the “Plan”) to reflect Exchange policies and general securities laws in other jurisdictions which was subsequently approved by the shareholders of the Corporation at the 2004 and 2005 annual meeting and accepted for filing by the Exchange.

The Plan is a “rolling” stock option plan under which options, including any outstanding options, may be granted to a maximum of 10% of the issued capital of the Corporation at the time of the grant of the stock option. Under the policies of the Exchange, “rolling” stock option plans are required to be approved by the shareholders at each annual general meeting. Accordingly the Corporation is seeking approval by the shareholders of the Plan at the Meeting pursuant to the policies of the Exchange.

Purpose of the Plan

The purpose of the Plan is to provide an incentive to the Corporation’s directors, senior officers, employees and consultants to continue their involvement with the Corporation, to increase their efforts on the Corporation’s behalf and to attract qualified new directors, senior officers and employees.

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General Description/Exchange Policies

The following is a brief description of the principal terms of the Plan, which description is qualified in its entirety by the terms of the Plan:

The full text of the Plan will be available for review at the Meeting. Unless otherwise indicated, it is management’s intention to vote the proxies in favour of the foregoing ordinary resolution for the adoption of the Plan.

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The shareholders of the Corporation will be asked to consider and, if thought appropriate, to approve and adopt an ordinary resolution in substantially the form set out below:

"NOW THEREFORE BE IT RESOLVED that:

Bonuses to Executive Officers of the Corporation

The Corporation has entered into employment contracts with certain of its executive officers pursuant to which the Corporation may pay bonuses, subject to the recommendation of the Compensation Committee of the Board of Directors and approval and acceptance by the Board of Directors. Such bonuses may be up to 100% of the executive officer’s base salary and may be payable in cash and/or shares. The Corporation is not required to obtain shareholder approval with respect to the payment of a cash bonus, however, it may be required to obtain disinterested shareholder approval with respect to issuance of such bonus in common shares of the Corporation. It is the Corporation’s intent to obtain disinterested shareholder approval at the Meeting with respect to bonus grants in common shares to its executive officers, subject to provisions of an executive officer’s employment contract and subject to approval by the Board of Directors of the Corporation.

At the Meeting, disinterested shareholders of the Corporation will be asked to pass an ordinary resolution in the following form:

NOW THEREFORE BE IT RESOLVED that:

Unless otherwise indicated, it is management’s intention to vote the proxies in favour of the foregoing ordinary resolutions. In order to be effective, the ordinary resolutions requires approval of 50% of the votes cast by shareholders who are entitled vote in respect of the resolution (disinterested shareholder approval).

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OTHER MATTERS

Management of the Corporation knows of no matters to come before the Meeting other than the matters referred to in the Notice of Meeting accompanying this Information Circular. However, if any other matters that are not known to management should properly come before the Meeting, it is the intention of the persons named in the form of proxy accompanying this Information Circular to vote upon such matters in accordance with their best judgement.

GENERAL

Unless otherwise directed, it is management’s intention to vote proxies in favour of the resolutions set forth herein. All ordinary resolutions require, for the passing of the same, a simple majority of the votes cast at the Meeting by the holders of Common shares.

ADDITIONAL INFORMATION

Additional information concerning the Corporation is available on SEDAR at www.sedar.com. Financial information concerning the Corporation is provided in the Corporation’s comparative financial statements and Management Discussion and Analysis for the financial year ended December 31, 2005.

Shareholders wishing to obtain a copy of the Corporation’s financial statements and Management’s Discussion and Analysis may contact the Corporation as follows:

APPROVAL OF THIS INFORMATION CIRCULAR

The undersigned certifies that the Board has approved the contents of this Information Circular and the sending, communication and delivery thereof to the shareholders.

BY ORDER OF THE BOARD OF DIRECTORS

“Richard W. Warke”

RICHARD W. WARKE
Chairman

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SCHEDULE “A”

AUGUSTA RESOURCE CORPORATION

STATEMENT OF CORPORATE GOVERNANCE PRACTICES

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SCHEDULE “B”

AUGUSTA RESOURCE CORPORATION

CHANGE OF AUDITOR NOTICE

On December 31, 2005, Deloitte & Touche, LLP of Vancouver, British Columbia, the auditor (the “Former Auditor”) of Augusta Resource Corporation (the “Corporation”) resigned as auditor and on January 5, 2005, Ernst & Young Inc. of Vancouver, British Columbia were appointed as the successor Auditors (the “Successor Auditors”) of the Corporation.

As the Corporation has the majority of its mineral properties in the United States, the Corporations Board of Directors decided to seek an additional listing in the United States. The Former Auditors informed the Corporation that they did not wish to continue as the Corporations Auditors as the Corporation was seeking a listing in the United States.

The Audit Committee considered the issues and recommended to the Board of Directors acceptance of the resignation of the Former Auditor and the appointment of the Successor Auditor, and the Board of Directors of the Corporation considered and approved the acceptance of the resignation of the Former Auditor and the appointment of the Successor Auditor.

None of the Former Auditor’s reports on any of the Corporation’s financial statements relating to the Corporation’s financial periods commencing January 1, 2003 contained any reservation.

There have been no “reportable events” (as defined in Section 4.11 of National Instrument 51-102 of the Canadian securities regulatory authorities) in respect of the Corporation for the period since January 1, 2003.

Dated at Vancouver, British Columbia, this 5^th day of January, 2006.

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			Ernst & Young LLP			Phone: (604) 734-1112
			Chartered Accountants			Fax: (604) 714-5916
			Pacific Centre
			700 West Georgia Street
			P.O. Box 10101
			Vancouver, BC V7Y 1C7

January 18, 2006

British Columbia Securities Commission
12^th Floor, 701 West Georgia Street
P.O. Box 10142, Pacific Centre
Vancouver, B.C. V7Y 1L2

Alberta Securities Commission
4^th Floor, 300 5^th Avenue S.W.
Calgary, AB T2P 3C4

Ontario Securities Commission
20 Queen Street West, Suite 1903
Toronto, ON M5H 3S8

Dear Sirs,

In accordance with National Instrument 51-102, we have read the Company’s Change of Auditor Notice dated January 5, 2006 and agree with the information contained therein, based upon our knowledge of the information at this date.

Should your require clarification or further information, please do not hesitate to contact the writer.

Yours very truly,

ERNST & YOUNG LLP
Chartered Accountants

cc:           TSX Venture Exchange, Augusta Resource Corporation Board of Directors

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5

SCHEDULE “C”

Augusta Resource Corporation
(the “Corporation”)

Audit Committee Charter

1.           OVERALL PURPOSE / OBJECTIVES

The committee will provide independent review and oversight of the Corporation’s financial reporting process, the system of internal control and management of financial risks, and the audit process, including the selection, recommendation, oversight and compensation of the Corporation’s external auditors. The committee will also assist the Board in fulfilling its responsibilities in reviewing the Corporation's process for monitoring compliance with laws and regulations and its own code of business conduct. In performing its duties, the committee will maintain effective working relationships with the Board of directors, management, and the external auditors and monitor the independence of those auditors. The committee will also be responsible for reviewing the Corporation’s financial strategies, its financing plans and its use of the equity and debt markets.

To perform his or her role effectively, each committee member will obtain an understanding of the responsibilities of committee membership as well as the Corporation’s business, operations and risks.

2.           AUTHORITY

The Board authorizes the committee, within the scope of its responsibilities, to seek any information it requires from any employee and from external parties, to retain outside legal or professional counsel and other experts and to ensure the attendance of Corporation officers at meetings as appropriate.

3.           ORGANIZATION

3.1 Membership

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3.2 Attendance at Meetings

4. ROLES AND RESPONSIBILITIES

The committee will:

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Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘40FR12B’ Filing		Date		Other Filings
		9/28/10		6-K
		8/22/10
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		3/28/10
		12/5/06
Filed as of:		7/14/06		F-X
Filed on:		7/13/06		F-X
		5/18/06
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		3/25/06
		3/24/06
		1/18/06
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		3/24/05
		1/5/05
		12/31/04
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		10/23/02
		8/7/02
		1/31/02
		9/15/98
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		8/18/97
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