NGD New Gold Inc

(All amounts are in Canadian $)

New Gold Inc. (the "Company" or "New Gold") (TSX:NGD)(AMEX:NGD) announced today
that it has mailed to the holders of its 10% Subordinated Notes an information
circular in connection with the Meeting of Noteholders on May 9, 2008 to approve
certain amendments to the Note Indenture dated as of June 27, 2007. The
amendments are required to enable New Gold to proceed with the proposed business
combination announced on March 31, 2008 (the "Transaction") by which the
Company, Metallica Resources Inc. ("Metallica") and Peak Gold Ltd. ("Peak") will
combine under the name New Gold Inc. with a market capitalization of
approximately U.S.$1.6 billion. The Transaction is subject to shareholder
approvals of each company and to the fulfillment of a number of conditions,
including the approval of the Noteholders to the proposed amendments to the Note
Indenture.


Mr. Cliff Davis, the President of the Company, noted: "When the Note Indenture
was entered into in June, 2007 the Company had one development project, the New
Afton Mine, and no subsidiaries and the Note Indenture reflected this. As the
merged company will have several projects and will operate through a number of
subsidiaries, certain of the covenants in the Note Indenture as they presently
stand would unduly restrict the manner in which the new entity could carry on
business while denying to the Company the anticipated improved credit worthiness
as a result of the Transaction. Therefore, it is necessary to request the
Noteholders to approve certain changes. The directors of New Gold have
unanimously recommended that the amendments be approved." The proposed
amendments include:


- Removing the permit test and replacing it with a more general covenant that
the Company shall work diligently toward obtaining and, once obtained,
maintaining in good standing, all permits required for the operation of its
properties;


- Providing for security on the New Afton Project in favour of the Noteholders;

- Creating a mechanism for cash flow movement between the Company and the new
subsidiaries including mandatory offers to redeem a portion of the Notes
annually;


- Renaming the Notes as "Senior Secured Notes";

- Providing for the issue pro rata to the Noteholders of 4,150,000 warrants to
purchase common shares of the Company prior to June 28, 2017 for the exercise
price of $15.00 per common share, subject to regulatory approval; and


- Certain other technical and housekeeping changes.

The changes are described in detail in the Circular mailed to Note holders and
filed on SEDAR and the Amended and Restated Indenture is included with the
Circular.


New Gold has had discussions with institutional holders of the Notes, both with
respect to certain housekeeping amendments approved prior to the announcement of
the Transaction and with respect to the amendments included in the Amended and
Restated Indenture.


Marret Asset Management Inc., a significant holder of the Notes, participated in
the structuring of the original Note issue and the amendment discussions. Barry
Allan, President of Marret, stated that: "The Transaction together with the
proposed amendments to the Note Indenture results in a significant enhancement
to the credit quality of the Notes. In addition to security being provided over
the New Afton Project, the Notes will now be supported by three operating
assets, increased operating cash flows, and a significantly stronger balance
sheet. We believe that the combination of the three companies along with the
proposed amendments will enhance the value to all stakeholders."


The March 31, 2008 letter agreement includes a condition precedent in favour of
Metallica and Peak, pursuant to which Metallica and Peak will not be obligated
to complete the Transaction if the terms of the Notes have not been amended to
the satisfaction of Metallica and Peak. The directors of Metallica and Peak have
approved the proposed amendments.


The amendments will be made pursuant to an Extraordinary Resolution of the
Noteholders which requires a quorum of Noteholders representing more than 51% of
the principal amounts of the Notes being represented at the Meeting and note
less than 66 2/3% so represented voting in favour. The Company may seek approval
by written resolution of holders of not less than 66 2/3% of the principal
amount of the Notes. If written approval is obtained in advance of the meeting,
the Company will cancel the Noteholders meeting. If approved, the Amended and
Restated Indenture will become effective on the date of the closing of the
Transaction. The Extraordinary Resolution includes a waiver of provisions of the
indenture replaced in the Amended and Restated Indenture. The waiver will expire
on the earlier of (A) September 30, 2008 or (B) seven day after the date on
which shareholders of any of the companies do not approve the Transaction at any
meeting called to approve the combination. Noteholders may, thereafter, exercise
all of their rights and remedies under the original Note Indenture and the
Amended and Restated Indenture will have no effect.


Certain of the statements made and information contained herein is "forward-
looking information" within the meaning of the Securities Act (Ontario) and the
Securities Act (Alberta) or "forward-looking statements" within the meaning of
Section 21E of the Securities Exchange Act of 1934 of the United States.
Forward-looking statements are subject to a variety of risks and uncertainties
which could cause actual events or results to differ from those reflected in the
forward-looking statements, including, without limitation, risks and
uncertainties relating to the interpretation of drill results and the estimation
of mineral resources and reserves, the geology, grade and continuity of mineral
deposits, the possibility that future exploration, development or mining results
will not be consistent with the Company's expectations, metal recoveries,
accidents, equipment breakdowns, title matters and surface access, labour
disputes or other unanticipated difficulties with or interruptions in
production, the potential for delays in exploration or development activities or
the completion of feasibility studies, the inherent uncertainty of production
and cost estimates and the potential for unexpected costs and expenses,
commodity price fluctuations, currency fluctuations, failure to obtain adequate
financing on a timely basis and other risks and uncertainties, including those
described under Risk Factors in the Company's Annual Information Form and in
each management discussion and analysis. Forward-looking information is in
addition based on various assumptions including, without limitation, the
expectations and beliefs of management, the assumed long term price of copper
and gold, that the feasibility study will confirm that a technically viable and
economic operation exists, that the Company will receive required permits and
access to surface rights, that the Company can access financing, appropriate
equipment and sufficient labour and that the political environment within
British Columbia and Canada will continue to support the development of
environmentally safe mining projects so that the Company will be able to
commence the development of the New Afton project within the timetable to be
established by the feasibility study. Should one or more of these risks and
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described in forward-looking
statements. Accordingly, readers are advised not to place undue reliance on
forward-looking statements.


Cautionary note to U.S. investors concerning estimates of Measured and Indicated
Resources, and the use the terms "measured" and "indicated resources." We advise
U.S. investors that, while those terms are recognized and required by Canadian
regulations, the U.S. Securities and Exchange Commission does not recognize
them. U.S. investors are cautioned not to assume that any part or all of mineral
deposits in these categories will ever be converted into reserves.


WARNING: The Company relies upon litigation protection for "forward-looking"
statements.

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