Sherritt Debtholders Approve Transaction to Improve Sherritt’s Capital Structure

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES

OR FOR DISSEMINATION IN THE UNITED STATES

Sherritt Debtholders Approve Transaction

to Improve Sherritt’s Capital Structure

TORONTO, July 23, 2020 – Sherritt International Corporation (“Sherritt” or the “Corporation”)

(TSX:S) announced today that the holders of the Corporation’s outstanding (i) 8.00% senior

unsecured debentures due 2021, (ii) 7.50% senior unsecured debentures due 2023, and

(iii) 7.875% senior unsecured notes due 2025 (the “ Noteholders”) and the holders of the

Corporation’s obligations under its Ambatovy Joint Venture partner loans (the “ CFA Lenders”

and together with the Noteholders, the “Debtholders”) approved, at the meeting of Debtholders

held today (the “Debtholders’ Meeting”), the Corporation’s previously announced transaction to

improve its capital structure (the “ Transaction”) and the plan of arrangement (the “ Plan of

Arrangement”) under the Canada Business Corporations Act (the “CBCA”) pursuant to which

the Transaction is be ing implemented. At the Debtholders’ Meeting, 89% of the votes cast by

Debtholders were voted in favour of the Plan of Arrangement.

In addition to the approval of the Plan of Arrangement by Debtholders at the Debtholders’ Meeting,

at the meeting of the holders of the common shares of Sherritt (the “Shareholders”) to consider

and vote on a resolution to reduce the stated capital of Sherritt’s common shares to $575 million

(the “Stated Capital Reduction Resolution”) as a preliminary step to the implementation of the

Transaction, the Stated Capital Reduction Resolution was approved by 96.5% of the votes cast

by Shareholders.

Sherritt and its subsidiary, 11722573 Canada Ltd. (together, the “ Applicants”) intend to seek

approval of the Plan of Arrang ement by the Ontario Superior Court of Justice (Commercial List)

(the “Court”) at a hearing currently scheduled for 9:00 a.m. (Toronto time) on July 29, 2020.

Subject to obtaining Court approval of the Plan of Arrangement and the satisfaction or waiver of

the other conditions to the implementation of the Plan of Arrangement, it is expected that the

Transaction will be completed at the end of August 2020. Upon implementation, the Plan of

Arrangement would bind all Debtholders of the Corporation.

As part of seeking Court approval of the Plan of Arrangement , the Applicants will seek a

permanent waiver of potential defaults resulting from the commencement of the CBCA

proceedings or the steps or transactions related to the CBCA proceedings or the Transaction, on

the terms set forth in the Plan of Arrangement.

This news release is not an offer of securities for sale in the United States. The securities to be

issued pursuant to the Transaction have not been and will not be registered under the U.S.

Securities Act of 1933 (the “ 1933 Act”), or the securities laws of any state of the United States,

and may not be offered or sold within the United States except pursuant to an exemption from the

registration requirements of the 1933 Act. The securities to be issued pursuant to the Transaction

will be issued and distributed in reliance on the exemption from registration set forth in Section

3(a)(10) of the 1933 Act (and similar exemptions under applicable state securities laws).

About Sherritt

Sherritt is a world lea der in the mining and refining of nickel and cobalt from lateritic ores with

projects, operations and investments in Canada, Cuba and Madagascar. The Corporation is the

largest independent energy producer in Cuba, with extensive oil and power operations across the

island. Sherritt licenses its proprietary technologies and provides metallurgical services to mining

and refining operations worldwide. The Corporation’s common shares are listed on the Toronto

Stock Exchange under the symbol “S”.

For more information, please contact:

Joe Racanelli, Director of Investor Relations

Telephone: 416-935-2457

Email: [email protected]

www.sherritt.com

Forward-Looking Statements

This news release contains certain forward-looking statements. Forward-looking statements can

generally be identified by the use of statements that include such words as “believe”, “expect”,

“anticipate”, “intend”, “plan”, “forecast”, “likely”, “may”, “will”, “could”, “should”, “suspect”, “outlook”,

“projected”, “continue” or other similar words or phrases. Specifically, forward-looking statements

in this document include, but are not limited to , statements set out in this news release relating

to: the expected process for and timing of implementing the Transaction; the expectation that the

Applicants will attend a hearing before, and seek certain relief from, the Court; and the expected

timing for the Court hearing seeking approval of the Plan of Arrangement.

Forward-looking statements are not based on historic facts, but rather on current expectations,

assumptions and projections about future events, including matters relating to the proposed

Transaction; commodity and product prices and demand; the level of liquidity; production results;

realized prices for production; earnings and revenues; and certain objectives, goals and plans.

By their nature, forward looking statements require the Corporation to make assumptions and are

subject to inherent risks and uncertainties. There is significant risk that predictions, forecasts,

conclusions or projections will not prove to be accurate, that those assumptions may not be

correct and that actual results or payments may differ materially from such predictions, forecasts,

conclusions or projections.

The Corporation cautions readers of this news release not to place undue reliance on any forward-

looking statement as a number of factors could cause actual future results, conditions, actions or

events to differ materially from the targets, expectations, estimates or intentions expressed in the

forward-looking statements. These risks, uncertainties and other factors include, but are not

limited to, risks associated with the ability of the Corporation to receive all necessary regulatory,

court and third party approvals in order to complete the Transaction; the ability of the Corporation

to achieve its financial goals; the ability of the Corporation to operate in the ordinary course during

the CBCA proceedings, i ncluding with respect to satisfying obligations to service providers,

suppliers, contractors and employees; the ability of the Corporation to continue as a going

concern; the ability of the Corporation to continue to realize its assets and discharge its liabilities

and commitments; the Corporation’s future liquidity position, and access to capital, to fund

ongoing operations and obligations (including debt obligations); the ability of the Corporation to

stabilize its business and financial condition; the ab ility of the Corporation to implement and

successfully achieve its business priorities; the ability of the Corporation to comply with its

contractual obligations, including, without limitation, its obligations under debt arrangements; the

general regulator y environment in which the Corporation operates; the tax treatment of the

Corporation and the materiality of any legal and regulatory proceedings; the general economic,

financial, market and political conditions impacting the industry and markets in which the

Corporation operates; the ability of the Corporation to sustain or increase profitability, fund its

operations with existing capital and/or raise additional capital to fund its operations; the ability of

the Corporation to generate sufficient cash flow from operations; the impact of competition; the

ability of the Corporation to obtain and retain qualified staff, equipment and services in a timely

and efficient manner (particularly in light of the Corporation’s efforts to restructure its debt

obligations); the ability of the Corporation to retain members of the senior management team,

including but not limited to, the officers of the Corporation; and the impact on business operations

of the Corporation resulting from the COVID-19 pandemic and the responses of government and

the public to the pandemic, and the implementation of the Transaction and the timing thereof.

Readers are cautioned that the foregoing list of factors is not exhaustive and should be considered

in conjunction with the risk factors des cribed in this news release and in the Corporation’s other

documents filed with the Canadian securities authorities, including without limitation the

Management’s Discussion and Analysis of the Corporation for the year ended December 31,

2019, the Management’s Discussion and Analysis of the Corporation for the three months ended

March 31, 2020, and the Annual Information Form of the Corporation dated March 19, 2020 for

the period ending December 31, 2019, which are available on SEDAR at www.sedar.com.

The Corporation may, from time to time, make oral forward-looking statements. The Corporation

advises that the above paragraph and the risk factors described in this news release and in the

Corporation’s other documents filed with the Canadian securities authorities should be read for a

description of certain factors that could cause the actual results of the Corporation to differ

materially from those in the oral forward-looking statements. The forward-looking information and

statements contained in this news release are made as of the date hereof and the Corporation

undertakes no obligation to update publicly or revise any oral or written forward -looking

information or statements, whether as a result of new information, future events or otherwise,

except as required by applicable securities laws. The forward-looking information and statements

contained herein are expressly qualified in their entirety by this cautionary statement.