Document:

Exhibit 4.7

 

FORM 51-102F3

MATERIAL CHANGE REPORT

UNDER NATIONAL INSTRUMENT 51-102

	
Item 1.

	
Reporting Issuer

	  	
New Gold Inc. (“New Gold” or “the “Company”)

Suite 1800 Two Bentall Centre, 555 Burrard Street

Vancouver, British Columbia, V7X 1M9

	  	  
	
Item 2.

	
Date of Material Change

	  	
May 15, 2013

	  	  
	
Item 3.

	
News Release

	  	
A press release with respect to this material change report was issued by New Gold on May 15, 2013 through Canadian Newswire and filed on the System for Electronic Document Analysis and Retrieval.

	  	  
	
Item 4.

	
Summary of Material Change

	  	
On May 15, 2013, New Gold announced the Company has eliminated its legacy gold hedges.

	  	  
	
Item 5.

	
Full Description of Material Change

	  	
(All figures are in US dollars unless otherwise indicated)

	  	  
	  	
On May 15, 2013 New Gold Inc. (“New Gold”) (TSX and NYSE MKT:NGD) announced that the company has eliminated its legacy gold hedges that were associated with the 2008 project financing put in place to develop the Mesquite mine. As a result of Mesquite’s successful start-up, the company repaid the loan in 2010, four years ahead of schedule. With the elimination of the hedges, New Gold’s gold production and gold resource base now have full leverage to the gold price.

	  	  
	  	
By unwinding the hedges, New Gold has removed the requirement to deliver 5,500 ounces of gold monthly at a fixed price of $801 per ounce from May 2013 through the end of 2014. In total, an additional 110,000 ounces of future production can now be sold at the prevailing spot gold price rather than the contract price of $801 per ounce. In total, the company paid $65.7 million to eliminate the gold hedges. The transaction was executed at an average spot price of $1,396 per ounce.

	  	  
	
Item 6.

	
Reliance on subsection 7.1(2) of National Instrument 51-102

	  	
The report is not being filed on a confidential basis.

	  	  
	
Item 7.

	
Omitted Information

	  	
No information has been omitted.

	  	  
	
Item 8.

	
Executive Officer

	  	
Susan Toews, Vice President Legal Affairs, and Corporate Secretary

	  	
(604) 639-2003

	  	  

  

  

  

 

	
Item 9.

	
Date of Report

	  	
May 16, 2012

	  	  
	  	
Cautionary Note Regarding Forward-Looking Statements

	  	
Certain information contained in this material change report, including any information relating to New Gold's future financial or operating performance may be deemed "forward looking". All statements in this material change report, other than statements of historical fact, that address events or developments that New Gold expects to occur, are "forward-looking statements”. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the use of forward-looking terminology such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", “projects”, “potential”, "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", “should”, "might" or "will be taken", "occur" or "be achieved" or the negative connotation. All such forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and are subject to important risk factors and uncertainties, many of which are beyond New Gold's ability to control or predict. Forward-looking statements are necessarily based on estimates and assumptions that are inherently subject to known and unknown risks, uncertainties and other factors that may cause actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. Such factors include, without limitation: significant capital requirements; fluctuations in the international currency markets and in the rates of exchange of the currencies of Canada, the United States, Australia, Mexico and Chile; price volatility in the spot and forward markets for commodities; impact of any hedging activities, including margin limits and margin calls; discrepancies between actual and estimated production, between actual and estimated reserves and resources and between actual and estimated metallurgical recoveries; changes in international, national and local government legislation in Canada, the United States, Australia, Mexico and Chile or any other country in which New Gold currently or may in the future carry on business; taxation; controls, regulations and political or economic developments in the countries in which New Gold does or may carry on business; the speculative nature of mineral exploration and development, including the risks of obtaining and maintaining the validity and enforceability of the necessary licenses and permits and complying with the permitting requirements of each jurisdiction that New Gold operates, including, but not limited to, in Canada obtaining the necessary permits for the Blackwater project, in Mexico where the Cerro San Pedro mine has a history of ongoing legal challenges related to our EIS and in Chile where the courts have temporarily suspended the approval of the environmental permit for the El Morro project; the lack of certainty with respect to foreign legal systems, which may not be immune from the influence of political pressure, corruption or other factors that are inconsistent with the rule of law; the uncertainties inherent to current and future legal challenges the company is or may become a party to; diminishing quantities or grades of reserves; competition; loss of key employees; additional funding requirements; actual results of current exploration or reclamation activities; uncertainties inherent to economic studies in respect of the PEA for the Blackwater project; changes in project parameters as plans continue to be refined; accidents; labour disputes; defective title to mineral claims or property or contests over claims to mineral properties. In addition, there are risks and hazards associated with the business of mineral exploration, development and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold bullion losses (and the risk of inadequate insurance or inability to obtain insurance to cover these risks) as well as "Risk Factors" included in New Gold's disclosure documents filed on and available at www.sedar.com.

	  	  
	  	
Forward-looking statements are not guarantees of future performance, and actual results and future events could materially differ from those anticipated in such statements. All of the forward-looking statements contained in this material change report are qualified by these cautionary statements. New Gold expressly disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise, except in accordance with applicable securities laws.Exhibit 4.8

 

FORM 51-102F3

MATERIAL CHANGE REPORT

UNDER NATIONAL INSTRUMENT 51-102

	
Item 1.

	
Reporting Issuer

	  	
New Gold Inc. (“New Gold” or “the “Company”)

Suite 1800 Two Bentall Centre, 555 Burrard Street

Vancouver, British Columbia, V7X 1M9

	  	  
	
Item 2.

	
Date of Material Change

	  	
May 31, 2013

	  	  
	
Item 3.

	
News Release

	  	
A press release with respect to this material change report was issued by New Gold on May 31, 2013 through Canadian Newswire and filed on the System for Electronic Document Analysis and Retrieval.

	  	  
	
Item 4.

	
Summary of Material Change

	  	
On May 31, 2013, New Gold and Rainy River Resources Ltd. (“Rainy River”) (TSX: RR) jointly announced that they have entered into a definitive acquisition agreement (the “Agreement”), whereby New Gold will offer to acquire all of the outstanding common shares of Rainy River through a friendly take-over bid.

	  	  
	
Item 5.

	
Full Description of Material Change

	  	
(All figures are in Canadian dollars unless otherwise indicated)

	  	  
	  	
New Gold Inc. (“New Gold”) (TSX and NYSE MKT:NGD) and Rainy River Resources Ltd. (“Rainy River”) (TSX: RR) jointly announced that they have entered into a definitive acquisition agreement (the “Agreement”), whereby New Gold will offer to acquire all of the outstanding common shares of Rainy River through a friendly take-over bid. Under the terms of the Agreement, New Gold will offer, at the election of each holder of Rainy River common shares, 0.5 of a common share of New Gold or $3.83 in cash, in each case subject to pro ration (the “Offer”). The Offer represents a premium of 42% over the closing price of the Rainy River shares on the Toronto Stock Exchange on May 30, 2013, the last day of trading prior to announcement of the Offer, and a 67% premium to Rainy River’s 20-day volume weighted average trading price. The maximum number of New Gold shares to be issued will be approximately 25.8 million and the maximum cash consideration will be approximately $198 million. The Offer values the fully-diluted in-the-money share capital of Rainy River, net of Rainy River’s current cash balance, at approximately $310 million.

	  	  
	  	
Transaction Highlights – New Gold

	  	
•

	
Accretive on all key per share metrics – gold reserves, net asset value, future production and cash flow

	  	
•

	
Adds 4.0 million ounce gold reserve in Ontario, further growing New Gold’s Canadian presence

	  	  	
o

	
Asset located in great mining jurisdiction, near infrastructure

	  	
•

	
Enhances pipeline by adding asset with annual average production potential of over 225,000 ounces over the life of the mine, at below industry average total cash costs (1)

  

  

  

 

	  	
•

	
Modest transaction size with minimal equity dilution to New Gold shareholders

	  	
•

	
Further strengthens New Gold technical development team, who have a track record of delivering on projects

	  	  
	  	
Transaction Highlights – Rainy River

	  	
•

	
Significant and immediate premium of 42% to current share price and 67% to 20-day volume weighted average share price

	  	
•

	
Flexibility to elect form of consideration in either cash or highly liquid New Gold shares

	  	
•

	
Opportunity to gain exposure to New Gold’s current operating cash flow and attractive growth portfolio

	  	
•

	
Access to New Gold’s strong balance sheet and current and future operating cash flow to develop the Rainy River project

	  	
•

	
Ability to partner with New Gold’s experienced management and operating teams

	  	  
	  	
Rainy River Gold Project

	  	
The Rainy River Gold project is an advanced-stage gold project situated in the Richardson Township, approximately sixty-five kilometres northwest of Fort Frances in Northwestern Ontario. The property has excellent infrastructure, with year-round road access and powerlines in close proximity, as well as a railway located 21 kilometres to the south of the property. The Fort Frances area has a population of approximately 10,000 people from which a workforce could be sourced for future development.

	  	  
	  	
On April 10, 2013, Rainy River announced the results of a Feasibility Study for the project, with 4.0 million ounces in Proven and Probable gold reserves and 6.2 million ounces in Measured and Indicated gold resources, inclusive of reserves. The Feasibility Study contemplates a 21,000 tonne per day processing rate from a combination of open pit, underground and stockpiled ore. The project has the potential to produce over 225,000 ounces of gold annually, at below industry average cash costs(1), for an initial mine life of 16 years. The Feasibility Study also highlights the potential to process higher grade ounces in the project’s early years, while stockpiling lower grades for processing towards the end of the mine life. This should help drive higher production and lower costs at the beginning of the mine life, enhancing both cash flow and the overall economics of the project.

 

  

  

  

 

	  	
Additional Details of Offer

	  	
The Board of Directors of Rainy River, upon the unanimous recommendation of its Special Committee, after consultation with its financial and legal advisors, has unanimously approved entering into the Agreement and recommends that Rainy River shareholders tender their shares to the Offer. BMO Capital Markets, the financial advisor to Rainy River, has provided a verbal opinion to the effect that, as of the date of such opinion and subject to the assumptions, limitations, and qualifications stated in such opinion, the consideration proposed to be paid to the holders of Rainy River common shares pursuant to the Offer is fair from a financial point of view to such holders. CIBC World Markets has provided a separate verbal opinion solely to Rainy River’s Special Committee to the effect that, as of the date of such opinion and subject to the assumptions, limitations, and qualifications stated in such opinion, the consideration proposed to be paid to the holders of Rainy River common shares pursuant to the Offer is fair from a financial point of view to such holders.

	  	  
	  	
Rainy River’s Board of Directors and management team have entered into lock-up agreements with New Gold agreeing to tender their shares, including shares issuable on the exercise of stock options, and support the transaction.

	  	  
	  	
The Agreement between New Gold and Rainy River provides for, among other things, a non-solicitation covenant on the part of Rainy River subject to customary "fiduciary out" provisions, a right in favour of New Gold to match any superior proposal and a payment to New Gold of a termination fee of approximately $14 million in certain circumstances, including if Rainy River accepts a superior proposal.

	  	  
	  	
The Offer is expected to commence during the week of June 10, 2013 upon the mailing of New Gold’s takeover bid circular and related documents, which will include full details of the Offer. Rainy River’s directors’ circular, which will set out the unanimous recommendation of the board of Rainy River that shareholders accept the Offer, will also be mailed. The Offer will be open for acceptance for a period of not less than 35 days from the date of mailing of the takeover bid circular and will be conditional upon, among other things, there being deposited under the Offer, and not withdrawn at the expiry time, shares representing not less than 66 2/3% of the Rainy River shares on a fully diluted basis. In addition, the Offer will be subject to certain customary conditions, including receipt of relevant regulatory approvals and the absence of a material adverse change with respect to Rainy River.

	  	  
	
Item 6.

	
Reliance on subsection 7.1(2) of National Instrument 51-102

	  	
The report is not being filed on a confidential basis.

	  	  
	
Item 7.

	
Omitted Information

	  	
No information has been omitted.

	  	  
	
Item 8.

	
Executive Officer

	  	
Susan Toews, Vice President Legal Affairs, and Corporate Secretary

	  	
(604) 639-2003

	  	  
	
Item 9.

	
Date of Report

	  	
June 6, 2013

  

  

  

 

	  	
U.S. Shareholders

	  	
New Gold will be filing with the United States Securities and Exchange Commission a registration statement on Form F-10 in connection with the Offer which will include the formal offer and take-over bid circular. New Gold encourages shareholders of Rainy River to read the formal offer and take-over bid circular which contain the full terms and conditions of the Offer and other important information.  The offer and take-over bid circular may be obtained free of charge through the Securities and Exchange Commission’s website at www.sec.gov or by directing a request to the Investor Relations department of New Gold.

	  	  
	  	
Cautionary Note Regarding Forward-Looking Statements

	  	
Certain information contained in this material change report constitutes “forward looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward looking information under the provisions of Canadian securities laws. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the use of forward-looking terminology such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", “projects”, “potential”, "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", “should”, "might" or "will be taken", "occur" or "be achieved" or the negative connotation. Such statements and information include, without limitation, statements regarding expectations as to the anticipated timing of the mailing of the offer materials, the estimated mineral resources and mineral reserves at Rainy River’s property, the expected further growth in gold reserves and ongoing cash flows and other benefits of the transaction containing forward-looking information.  This forward looking information is subject to numerous risks, uncertainties and assumptions, certain of which are beyond the control of Rainy River and/or New Gold, including risks relating to acquisitions, including, without limitation, the parties may be unable to complete the acquisition or completing the acquisition may be more costly than expected because, among other reasons, conditions to the closing of the acquisition may not be satisfied; problems may arise with the ability to successfully integrate the businesses of New Gold and Rainy River, the parties may be unable to obtain regulatory approvals required for the acquisition, New Gold may not be able to achieve the benefits from the acquisition or it may take longer than expected to achieve those benefits; and the acquisition may involve unexpected costs or unexpected liabilities. Other risks include the impact of general economic conditions; industry conditions; volatility of metals prices; volatility of commodity prices; currency fluctuations; mining risks; risks associated with foreign operations; governmental and environmental regulation; competition from other industry participants; the lack of availability of qualified personnel or management; stock market volatility; the ability of New Gold to complete or successfully integrate an announced acquisition proposal; unexpected costs or unexpected liabilities related to the acquisition.  Readers are cautioned that the material assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise. Actual results, performance or achievement could differ materially from those expressed in, or implied by, this forward-looking information and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking information will transpire or occur, or if any of them do so, what benefits that Rainy River and/or New Gold will derive therefrom.  New Gold and Rainy River disclaim any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise except as required by applicable securities laws. The issuance of New Gold shares under the transaction is subject to TSX acceptance or approval.

	  	  

 

  

  

  

	  	
Cautionary Note to U.S. Readers Concerning Estimates of Measured, Indicated and Inferred Mineral Resources

	  	  
	  	
Information concerning the properties and operations discussed in this material change report has been prepared in accordance with Canadian standards under applicable Canadian securities laws, and may not be comparable to similar information for United States companies. The terms "Mineral Resource", "Measured Mineral Resource", "Indicated Mineral Resource" and "Inferred Mineral Resource" used in this material change report are Canadian mining terms as defined in accordance with NI 43-101 under guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") Standards on Mineral Resources and Mineral Reserves adopted by the CIM Council on November 27, 2010. While the terms "Mineral Resource", "Measured Mineral Resource" and "Indicated Mineral Resource" are recognized and required by Canadian regulations, they are not defined terms under standards of the United States Securities and Exchange Commission. Under United States standards, mineralization may not be classified as a "reserve" unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve calculation is made. As such, certain information contained in this material change report concerning descriptions of mineralization and resources under Canadian standards is not comparable to similar information made public by United States companies subject to the reporting and disclosure requirements of the United States Securities and Exchange Commission. An "Inferred Mineral Resource" has a great amount of uncertainty as to its existence and as to its economic and legal feasibility. It cannot be assumed that all or any part of an "Inferred Mineral Resource" will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. Readers are cautioned not to assume that all or any part of Measured or Indicated Resources will ever be converted into Mineral Reserves. Readers are also cautioned not to assume that all or any part of an "Inferred Mineral Resource" exists, or is economically or legally mineable. In addition, the definitions of "Proven Mineral Reserves" and "Probable Mineral Reserves" under CIM standards differ in certain respects from the standards of the United States Securities and Exchange Commission.

	  	  
	  	
Technical Information

	  	
New Gold

	  	
The scientific and technical information, as it relates to New Gold, in this material change report has been reviewed and approved by Mark Petersen (AIPG CPG #10563), a Qualified Person under National Instrument 43-101 and employee of New Gold.

	  	  
	  	
Rainy River

	  	
The scientific and technical information, as it relates to Rainy River, in this material change report has been reviewed and approved by Garett Macdonald, P.Eng. (PEO #90475344) and Kerry Sparkes, P.Geo. (APEGBC #25261), both Qualified Persons under National Instrument 43-101 and employees of Rainy River. Rainy River's exploration program in Richardson Township is being supervised by Kerry Sparkes, P.Geo. (APEGBC #25261), a Qualified Person under National Instrument 43-101 and employee of Rainy River.

	  	  
	  	
Rainy River Mineral Reserves

	  	
Mineral resources are not mineral reserves and do not have demonstrated economic viability. Mineral resources are reported relative to conceptual open pit shells. On average, the conceptual open pit extends to an elevation of 500 metres below surface. Material above this elevation offers reasonable prospects for economic extraction from an open pit because drilling results suggest that the zone of gold mineralization is broader than currently modeled and that new drilling information should positively impact future mineral resources. Material below this elevation is potentially mineable by underground mining methods. Mineral resources that are potentially mineable by open pit methods are reported at a cut-off grade of 0.35 g/t gold; underground mineral resources are reported at a cut-off grade of 2.5 g/t gold. All mineral resources are based on a gold price of US$1,100 per ounce, a silver price of US$22.50 per ounce, a foreign exchange rate of 1.10 Canadian dollars to 1.0 US dollar. Metallurgical recoveries include 88% for gold in open pit resources and 90% for gold in underground resources, with a silver recovery of 75% in both cases.

  

  

  

 

	  	  
	  	
All figures are rounded to reflect the relative accuracy of the estimate. Figures may not add due to rounding. Additional details on the Mineral Resource estimate are provided in the Rainy River material change report dated October 10, 2012.  Mineral Resources were estimated by SRK Consulting (Canada) Inc. (“SRK”) and are reported in accordance with Canadian Securities Administrators National Instrument 43-101.

	  	  
	  	
(1) TOTAL CASH COSTS

	  	
“Total cash costs” per ounce figures are calculated in accordance with a standard developed by The Gold Institute, which was a worldwide association of suppliers of gold and gold products and included leading North American gold producers. The Gold Institute ceased operations in 2002, but the standard is widely accepted as the standard of reporting cash costs of production in North America. Adoption of the standard is voluntary and the cost measures presented may not be comparable to other similarly titled measures of other companies. Each of New Gold and Rainy River reports total cash costs on a sales basis. Total cash costs include mine site operating costs such as mining, processing, administration, royalties and production taxes, but are exclusive of amortization, reclamation, capital and exploration costs. Total cash costs are reduced by any by-product revenue and is then divided by ounces sold to arrive at the total by-product cash cost of sales. The measure, along with sales, is considered to be a key indicator of a company’s ability to generate operating earnings and cash flow from its mining operations. This data is furnished to provide additional information and is a non-IFRS measure. Total cash costs presented do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other mining companies. It should not be considered in isolation as a substitute for measures of performance prepared in accordance with IFRS and is not necessarily indicative of operating costs presented under IFRS. A reconciliation is provided in the respective MD&A and accompanying the quarterly financial statements of each of Rainy River and New Gold.

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