Sherritt Updates CBCA Transaction and Extends Early Consent Deadline
Sherritt International Corporation (“Sherritt” or the “Corporation”) (TSX: S) today announced an amendment to its previously disclosed transaction to extend the maturities of its note obligations and enhance its capital structure under the Canada Business Corporations Act (“CBCA”). Following discussions with certain holders of the Corporation’s Existing Notes, Sherritt has increased the Junior Notes Exchange Ratio under the CBCA Plan from 0.50 to 0.60.
This amendment is part of Sherritt’s corporate plan of arrangement, detailed in the Corporation’s management information circular dated March 4, 2025. The CBCA Transaction is also described in the March 4 News Release.
Extended Early Consent Deadline
Sherritt is extending the Early Consent Deadline for holders of its outstanding notes. The deadline for holders of the Corporation’s 8.50% senior second lien secured notes due November 30, 2026 (“Senior Secured Notes”) and 10.75% unsecured PIK option notes due August 31, 2029 (“Junior Notes”) to vote in favor of the CBCA Plan and be eligible for early consent consideration is now March 28, 2025, at 5:00 p.m. (Toronto time).
To be eligible for early consent consideration, Senior Secured Noteholders must vote in favor of the CBCA Plan and elect to receive a cash payment equal to 3% of the principal amount of Senior Secured Notes they vote in favor of by the Early Consent Deadline. Similarly, Junior Noteholders must vote in favor of the CBCA Plan and elect to receive additional amended 9.25% senior second lien secured notes due November 30, 2031 (“Amended Senior Secured Notes”), equal to 5% of the principal amount of Junior Notes voted in favor.
Consent and Support Agreement
Certain holders of Existing Notes, representing approximately 42% of the outstanding Senior Secured Notes, have entered into a consent and support agreement with Sherritt. These Initial Consenting Noteholders have agreed to support the CBCA Transaction, vote in favor of the CBCA Plan, and accept the CBCA Transaction Amendment.
Voting Deadline and Noteholder Meetings
The final voting deadline is set for April 2, 2025, at 5:00 p.m. (Toronto time). The Senior Secured Noteholders’ Meeting and Junior Noteholders’ Meeting will be held on April 4, 2025, at the offices of Goodmans LLP in Toronto, Ontario.
Noteholders are encouraged to submit their voting instructions before the Voting Deadline. Those who have already voted do not need to resubmit unless they wish to change their votes.
Potential Removal of Junior Notes Exchange
Sherritt, together with the Majority Initial Consenting Noteholders, has the right to amend the CBCA Plan to remove the Junior Notes Exchange. Junior Noteholders will have the option to proceed with the exchange outside the CBCA Plan, under the same terms as originally contemplated, subject to a maximum of $40 million in Amended Senior Secured Notes being issued.
About Sherritt
Sherritt is a leader in the hydrometallurgical extraction of nickel and cobalt, critical metals for the energy transition. The company’s Moa Joint Venture has an estimated 25-year mine life and is working to increase annual nickel and cobalt production. Sherritt is also the largest independent energy producer in Cuba through its ownership in Energas, which has an installed generating capacity of 506 MW, about 10% of Cuba’s national capacity. Sherritt’s common shares are listed on the Toronto Stock Exchange under the symbol “S.”
