Nevoro Inc.
TSX : NVR

Nevoro Inc.

April 24, 2008 15:00 ET

Nevoro to Acquire Sheffield Resources Ltd. and the Moonlight Copper Project With Current NI 43-101 Copper, Gold and Silver Resources

TORONTO, ONTARIO--(Marketwire - April 24, 2008) - Nevoro Inc. ("Nevoro") (TSX:NVR) is pleased to announce that it has entered into an agreement to acquire all of the issued and outstanding shares of Sheffield Resources Ltd. (TSX VENTURE:SLD) ("Sheffield"). Nevoro will issue 0.8 shares for each Sheffield share. Currently, Sheffield has 35,422,497 shares issued and outstanding.

Sheffield's principal asset is the advanced-stage Moonlight Copper project located 140 km northwest of Reno, Nevada in Plumas County, California. The Moonlight Copper project is a 100%-owned 6,857 acre porphyry-Cu and Cu-oxide property with current NI 43-101 compliant indicated resources of 161.57 million tons averaging 0.324% Cu (at 0.2% Cu cutoff), 0.003 oz./ton Au and 0.112 oz./ton Ag, plus inferred resources of 88.35 million tons averaging 0.282% Cu, 0.003 oz./ton Au and 0.089 oz./ton Ag.

Additionally, Sheffield has an option to acquire the 9,161-acre, early-stage, Golden Loon Ni-Co-PGE-Au property, 80 km north of Kamloops, British Columbia. Historical exploration - limited drilling, geochemistry and geophysics - has identified encouraging Ni-Co and PGE mineralization in ultramafic rocks that underlie the property (Sheffield news release, March 6, 2007).

Terms of the Acquisition

According to the agreement, each Sheffield common share will be cancelled and the holders thereof will receive for each share 0.80 of one Nevoro common share, which represents a value of approximately C$0.48 per share based upon the closing price of Nevoro common shares on the Toronto Stock Exchange on April 23, 2008. Holders of common share purchase warrants of Sheffield, in accordance with the terms of such warrants, in lieu of Sheffield's shares, shall receive upon the subsequent exercise of such holder's Sheffield Warrant, 0.80 of one Nevoro Share. Each holder of an outstanding Sheffield stock option, in accordance with the terms of the Sheffield stock option ("Sheffield Option") plan, shall receive an option to acquire the number of Nevoro Shares equal to the product of: (i) the number of Sheffield Shares subject to the Sheffield Option immediately before the closing, and (ii) 0.80 of one Nevoro Share, the exercise price per Nevoro Share shall be an amount equal to the quotient of (A) the exercise price per Nevoro Share subject to such Sheffield Option immediately before closing divided by (B) 0.80.

Currently, Nevoro has 75,163,585 common shares outstanding and Sheffield has 35,422,497 shares issued and outstanding. Nevoro announced on April 17, 2008 a plan of arrangement to acquire 100% of Aurora Metals (BVI) Limited ("Aurora") (OTCBB:AURMF) 19,981,476 issued and outstanding shares at an exchange ratio of 1 for 1 share. Upon the closing of both acquisitions Nevoro, will have 123,483,058 issued and outstanding common shares and Nevoro's current shareholders will hold approximately 60.9%, Sheffield shareholders will hold approximately 22.9% of these shares, and Aurora shareholders will hold 16.2%

On a fully diluted basis, there will be 148,525,022 shares outstanding with current Nevoro shareholder having approximately 59%, Aurora shareholders having approximately 13.4% and Sheffield shareholder having approximately 27.6%. Exercise of all of the outstanding warrants and options in each company will raise an additional $11.2 million in cash.

The acquisition is subject to the completion of due diligence by Nevoro and the parties entering into a further definitive agreement providing specific mechanics for completing the transaction. The Board of Directors of Sheffield will recommend the transaction to the shareholders, having received an opinion from financial advisors to the effect that consideration to be received by Sheffield shareholders is fair from a financial point of view. The acquisition is also subject to all requisite regulatory approvals, third party consents, obtaining all Security holder approvals required by applicable laws and such other conditions as are customary in transactions of this nature.

In addition to the agreement, Nevoro and Sheffield have agreed to a working capital funding to Sheffield by Nevoro by way of a secured grid promissory note (the "Grid Note") under which Sheffield can receive advances up to C$400,000, in the aggregate, from Nevoro. The advances will be secured by a mortgage of Sheffield's interest in the Moonlight Copper Project in Plumas County, California and are subject to an interest rate equal to the Prime Rate, as quoted by the Royal Bank of Canada, plus 2% per annum. The Note can be called on 90 days notice, by Nevoro and can be satisfied, at Sheffield's option, by the issuance of common shares of based on a conversion rate equal to the lower of: (i) 75% of the average closing price of Sheffield's common shares as listed on the Toronto Stock Exchange - Venture Exchange (the "TSX-V") for the 20 trading days immediately preceding the date of this Agreement; and (ii) 75% of the average closing price of Sheffield's common shares as listed on the TSX-V for the 20 trading days immediately preceding the effective date of conversion (being the 90th day after the date of demand), and subject to the acceptance of the TSX-V to these terms of conversion.

Moonlight Project Current Mineral Resources

The Moonlight project contains four advanced Cu-Au-Ag targets - Moonlight Valley, Engels Mine, Superior Mine Area and Copper Mountain.

The most intensely explored is the Moonlight Valley deposit, which contains National Instrument ("NI") 43-101 compliant mineral resources defined by 199 historical core holes (30,300 m) and 14 recent confirmation core holes (3,400 m) as reported in "Technical Report and Resource Estimate on the Moonlight Copper Property, Plumas County, California for Sheffield Resources Ltd.", by George Cavey, P.Geo., and Gary Giroux, P.Eng, dated April 12, 2007 (the: "2007 Technical Report"), and filed on SEDAR (www.sedar.com). The current NI 43-101 mineral resources are as follows:



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Indicated Mineral Resource Inferred Mineral Resource
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Cut off Tons greater Au Ag Tons greater Au Ag
(Cu %) than cutoff Cu (%) (oz/t) (oz/t) than cutoff Cu (%) (oz/t) (oz/t)
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0.20 161,570,000 0.324 0.003 0.099 88,350,000 0.282 0.003 0.089
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0.25 114,570,000 0.366 0.003 0.112 48,820,000 0.329 0.003 0.107
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0.30 76,150,000 0.413 0.003 0.124 23,720,000 0.390 0.003 0.118
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These indicated and inferred resources do not take into account the oxide mineralization drilled at the Moonlight Valley or the historic resources defined at the Superior Mine Area.

The 2007 Technical Report notes that Placer recognized significant amounts of copper were lost during their drilling and because of this the copper grades estimated from the drilling - which are the grades used in the NI 43-101 resource estimation - are conservative and apparently understated. Sheffield's recent drilling recovered 44% more copper in their Moonlight Valley drill holes than in the adjacent Placer drill holes. Reasons offered for the historically understated drill grades include improper orientation of the historical drill holes, small BX-size core in the historical drilling resulting in very poor recoveries, loss of copper minerals in the historical drilling as confirmed by Placer's own comparison sludge sampling, possible analytical issues, and perhaps other items as well. This means that the Moonlight Valley deposit, which remains open at depth and along strike, is potentially larger than currently known and may also be potentially richer than indicated by the historical drilling.

Commenting on the proposed transaction, William Schara, President and CEO of Nevoro said, "We are delighted with this acquisition. The Moonlight Project is a unique, district-sized advanced stage, pre-development project with established resources. These properties, combined with the properties we will acquire with the Aurora acquisition, will give Nevoro tremendous growth potential."

Moonlight Project Background

The Moonlight project ("Moonlight") is approximately 140 km northwest of Reno, Nevada, at the northern terminus of the Walker Lane Mineral Belt, in Plumas County, California (See Figure 1). It consists of 289 wholly owned contiguous unpatented mining claims, 8 optioned contiguous unpatented mining claims, 36 patented mining claims and 6 fee property claims - together comprising 6,857 acres (2,775 hectares, or almost 28 km2) of 100%-owned mineral rights.

Please note: To view "Figure 1 - Moonlight Project Showing Copper Deposits with Location Inset Map", please visit the following link:

http://media3.marketwire.com/docs/0424figure.pdf

Moonlight is part of the Lights Creek mineral district within the Plumas Copper Belt, the second most productive copper region in the state and known for its many high-grade Cu-Au-Ag mines, largely inactive since the late 1930s. Moonlight includes two important historical producers, the Engels and Superior mines, which, from 1918 to 1930, jointly processed ore with 80% recoveries in the first all-flotation mill in the United States and produced more than 160 million pounds of copper, 23,000 ounces of gold and 1.9 million ounces of silver from ores averaging 2.2% Cu, 0.5 oz./ton Ag and 0.005 oz./ton Au.

Placer Amex ("Placer") first explored the district in 1961 and during the following ten years spent more than US$6 million (equivalent to about $35 million today) in mapping, geophysics, geochemistry and diamond core drilling (greater than 43,000 m). At least seven different potential open-pit copper targets were explored in some detail, with historical resources successfully defined on three of these targets. Placer put the project on hold in 1971 due to declining metal prices but maintained the ground for another 23 years (until 1994), during which time Placer Amex became Placer Dome with focus changed to gold.

Sheffield acquired the project in 2004 and from late-2005 to early-2007 drilled 14 large-diameter (HQ-size) core holes (3,400 m) to verify historical grades and resources on two of the targets. An initial NI 43-101 Technical Report on Moonlight was completed in March 2005, followed by a second Technical Report in April 2007, which includes the NI 43-101 Resource Estimates for the Moonlight Valley deposit listed above. Sheffield has since drilled 15 reverse circulation holes to confirm an additional oxide copper historical resource at the Moonlight Valley target and 32 diamond drill holes at the Engels mine target, a high-grade structurally-controlled copper zone 4.5 km east of the Moonlight Valley deposit.

Moonlight Geology

Mineralization on the Moonlight project is hosted by a large and complex Jurassic intrusive stock regionally located near the triple point junction of the Cascade, Sierra Nevada and Basin and Range provinces. The mineralization has been classified as a porphyry-copper type system but does not exhibit many features characteristic of these systems. Additionally, it is an unusual low-sulfide system containing only sparse amounts of acid-generating sulfide minerals such as pyrite.

Copper mineralization is widespread over most of the 28 km2 Moonlight area, occurring as discrete large high-grade veins, veinlets and extensive disseminations in the wallrock between the veins. The wallrock alteration is far less conspicuous than typical porphyry-copper systems due to the paucity of acid-generating sulfide minerals, and many low-grade copper occurrences in the region have not been recognized in the past due to the lack of conspicuous surface alteration.

The primary hypogene copper minerals at Moonlight consist mostly of bornite, chalcopyrite, and chalcocite which are associated with considerable amounts of magnetite and specular hematite. The secondary copper minerals - malachite, azurite, and chrysocolla - occur in the oxide zone, which extends from the surface to a depth of 50 m or more. The secondary minerals appear to be the products of in-situ oxidation of the primary copper minerals and not the products of supergene enrichment, which is of very limited extent. The lack of supergene enrichment is attributed to the lack of acid-generating primary sulfide minerals. The presence of abundant tourmaline, roof pendants, country rock clasts and other features offer evidence that the mineralization exposed on the project occurs near the roof of the intrusive complex, in which case the mineralization can be expected to persist to considerable depth.

Moonlight Copper Targets

Moonlight Valley

Placer identified at least seven different targets, four of which were explored in some detail. The most intensively explored target is the Moonlight Valley sulfide deposit, which contains the previously mentioned mineral resources (see table above), which remains open laterally and to depth. Mineralization extends from the surface to a vertical depth of at least 600 m, which is the length of the deepest hole yet drilled on the target. This hole was mineralized throughout its length (averaging 0.185% Cu) and bottomed in 0.3% Cu. The limits of the deposit are unknown. Additionally, the historical work by Placer, and reconfirmed by Sheffield, indicates that the area also contains substantial near surface oxide copper mineralization, comprising a shallow copper target possibly amenable to low-cost SX-EW extraction. This oxide mineralization was not included in the resource reported in the 2007 Technical Report.

Engels Mine

The Engels mine, a historically important producer, located on private patented ground approximately 4.5 km east of Moonlight Valley. It is currently being drilled by Sheffield to define high-grade mineralization, which might be mined as a "fast-track" starter operation. Mineralization consists of high-grade bornite-chalcopyrite-magnetite occurring in a pipe-like body, 50 to 100 m wide, more than 200 m long, and extending over a vertical range of at least 700 m. Sheffield's recent 32-hole drilling program at Engels - reported in a news release dated March 18, 2008, available on SEDAR (www.sedar.com) - demonstrates high-grade oxide copper mineralization (typically 1% to 2%) from surface to depths of more than 200 m over intervals ranging from a few m up to 102 m.

Superior Mine Area

The Superior mine area, is on private patented ground approximately 3 km southeast of Moonlight Valley. It consists of a large stockwork of parallel high-grade bornite-chalcopyrite-magnetite veins from 2.5 to 6.0 m thick and separated by 30 to 120 m of wallrock containing disseminated copper in the 0.3% to 0.8% range. Placer examined Superior as a possible open-pit target, drilling 96 core holes to an average depth of 160 m and estimating an historical resource of 43 million tons grading 0.56% Cu (with a 0.3% Cu cutoff), as summarized in the 2007 Technical Report. Although these historical resources are considered relevant, they do not follow the requirements for reserve and resource estimations outlined in NI 43-101 and should therefore not be considered current. Not included in these historical resources are substantial quantities of higher grade material remaining in the Superior mine underground workings below open-pit depth. The configuration of mineralization, rock quality and the abundant mine workings could make the Superior deposit amenable to very low cost underground mining methods.

Copper Mountain

Copper Mountain is one km southeast of Moonlight Valley. Placer drilled 24 vertical holes (3,670 m) on this target, reportedly intersecting significant intervals of 0.3 to 0.4 % Cu to depth.

Other Targets

Other targets partially tested by Placer, but not yet tested by Sheffield, include Moonlight South, a possible high-grade target in or beneath a large pendant of metavolcanic country rocks which overlies the southwest-plunging Moonlight Valley porphyry system. The pendant contains widespread specular hematite, quartz veinlets and scattered copper oxides, possibly representing an alteration-mineralization halo above a high-grade zone trapped within or beneath the pendant, a situation generally analogous to that reported from some important districts such as Pebble, Alaska, and Oyu Tolgoi, Mongolia. Three grab samples collected by Sheffield from the dump of the collapsed Ruby mine located within this pendant averaged 5.28% Cu, 1.87 g/t Au and 211 g/t Ag. Other outlying targets of future interest include Sulphide Ridge, Gossan Ridge, Blue Copper and others.

Moonlight Project Exploration Upside

The Moonlight project is underlain by an intrusive complex of large size, extending to unknown depth, and contains high-grade structurally controlled mineralization associated with an unusual low-sulfide type of disseminated mineralization that could easily be overlooked in reconnaissance examinations. The copper mineralization is widespread over an area of at least 30 km2, within which several targets of promising size and grade have already been defined, and other targets have been identified which warrant additional exploration.

It is Nevoro's intention to accelerate the work underway by Sheffield in order to rapidly advance and expand the Moonlight Valley resource. The exploration target objective is a 400 to 600 million tonne copper deposit grading 0.4 to 0.6% Cu, however these potential quantities and grades are conceptual in nature. The historical and current exploration work done to date are insufficient to define this target and it is uncertain if further exploration will result in the discovery of any mineralization of economic importance.

Nevoro also plans to: (a) continue defining the potential SX-EW amenable, high-grade oxide copper mineralization on the Moonlight Valley and Engels targets; (b) advance the high-grade Superior target to a possible resource stage; and (c) explore and advance the several other scarcely tested copper targets on the project and in the surrounding region.

The qualified person under NI 43-101 responsible for reviewing all technical data reported in this news release is Mr. Mel Klohn, M.Sc., L.P. Geo., a director of Nevoro Inc.

About Nevoro Inc.

Nevoro is a TSX-listed exploration and development company focused on the discovery of base and precious metals in the western USA. In addition to the planned purchase of Sheffield Resources Ltd. and the Moonlight Copper Project, Nevoro intends to advance the Stillwater project by upgrading and enhancing the historical, NI 43-101 resources. Nevoro also holds 13 gold projects in Nevada and Idaho.

CAUTIONARY STATEMENT: All statements, other than historical fact, contained or incorporated by reference in this news release, including any information as to the future financial or operating performance of Nevoro, constitute "forward looking statements" within the meaning of certain securities laws, and are based on expectations, estimates and projections as of the date of this news release. Such "forward looking statements", reflects management's current beliefs and is based on information currently available to management of Nevoro. In some cases, forward-looking information can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", "intention" or the negative of these terms or other similar expressions concerning matters that are not historical facts. Forward-looking information in this news release includes but is not limited to, completion of the acquisition, economic performance of Nevoro and of the combined company, statements regarding potential mineralization and resource, explorations and future plans and objectives of Nevoro, including exploration and development. Forward-looking information involves significant risks and uncertainties. A number of factors could cause actual events or results to differ materially from the events and results discussed in the forward-looking information including risks related to investments, conditions of capital markets, economic conditions, dependence on key personnel, interest rates, regulatory change and availability of future financing. These factors should not be considered exhaustive. In addition, in evaluating this information, investors should specifically consider various factors, including risk factors, which may cause actual events or results to differ materially from any forward-looking statement. In formulating forward-looking information herein, management has assumed that business and economic conditions affecting Nevoro will continue substantially in the ordinary course, including without limitation with respect to general levels of economic activity, regulations, taxes, interest rates and that there will be no material changes. Although the forward-looking information is based on what management of Nevoro considers to be reasonable assumptions based on information currently available to it, there can be no assurance that actual events or results will be consistent with this forward-looking information, and management's assumptions may prove to be incorrect. This forward-looking information is made as of the date of this press release, and Nevoro does not assume any obligation, except as required by law, to update or revise them to reflect new events or circumstances. Undue reliance should not be placed on forward-looking information.

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