Sherritt International Corporation
TSX : S

Sherritt International Corporation

April 11, 2014 10:26 ET

Sherritt Responds to Dissident George Armoyan's Erratic Actions, Misleading Claims and Ever-Changing Demands

TORONTO, ONTARIO--(Marketwired - April 11, 2014) -

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Sherritt International Corporation ("Sherritt") (TSX:S) provided the following in response to yesterday's press release by dissident shareholder George Armoyan and his continuing attempts to confuse and mislead shareholders in regards to the shareholder meeting requisition and dissident nomination process.

"Mr. Armoyan appears to be making every effort to confuse the issues," said Harold (Hap) Stephen, Chairman of Sherritt. "There are a few very simple facts at play. The first is that Sherritt has made repeated attempts to avoid the cost and distraction of an unnecessary proxy contest, including by offering to add a new director acceptable to both Sherritt and Mr. Armoyan. Mr. Armoyan has consistently rejected these efforts."

Mr. Stephen continued, "The second is that Sherritt has positive momentum in its business. This includes the recent coal transaction, the progress at Ambatovy, our ongoing cost reduction efforts and plans to expand our oil & gas and power generation businesses in Cuba. Sherritt's progress owes no credit whatsoever to Mr. Armoyan, whose erratic behavior, misleading statements and lack of relevant experience makes it abundantly clear that he is not a suitable candidate for Sherritt's Board."

The facts regarding what has transpired are as follows:

  • In December 2013, Mr. Armoyan demanded three Board seats, to be filled by him and his two employees and that he be made Chairman of the Board.

  • On December 23, 2013, George Armoyan, via Clarke Inc., requisitioned a shareholder meeting and proposed himself and two of his employees, Dustin Haw and Michael Rapps, for election as dissident director nominees.

  • Absent Clarke withdrawing its requisition, Sherritt was legally obligated to call a shareholder meeting for that purpose, which it has done. At no time has Clarke withdrawn its requisition or its nomination of Mr. Haw and Mr. Rapps.

  • On January 10, 2014, Sherritt set a record date of March 18, 2014 for determining shareholders who are entitled to vote at the meeting.

  • On March 20, 2014, two days after the record date, Clarke Inc. issued a three-page press release in which it announced it would be making a number of shareholder proposals. At no point did it mention any intention of naming new nominees or withdrawing Mr. Haw or Mr. Rapps.

  • At a meeting on March 24, 2014, Mr. Rapps repeatedly argued the case to Sherritt Chairman Hap Stephen and Sherritt Director Peter Gillin, that either Mr. Rapps or Mr. Haw would be suitable nominees for Sherritt's Board. When told that Sherritt's Board was willing to nominate another candidate that Clarke had identified, but not either Mr. Rapps or Mr. Haw, Mr. Rapps commented that Clarke had "a slate of nominees." At no time was Sherritt advised that Clarke intended to withdraw either Mr. Rapps or Mr. Haw as dissident director nominees.

  • With just over a month until the shareholder meeting, on March 31, 2014, Sherritt published its proxy circular and listed the only three requisitioned dissident nominees put forward for election by Clarke as of that date: Mr. Armoyan, Mr. Haw and Mr. Rapps.

  • Only after Sherritt had published its circular Clarke issued a press release claiming that Mr. Haw and Mr. Rapps would not be nominated. However, Clarke still did not identify who it intended to nominate.

  • Three days later, on April 3, 2014, fully 101 days following its requisition, Clarke issued a press release announcing a new slate of dissident nominees that did not include either Mr. Haw or Mr. Rapps.

  • On April 9, 2014, Clarke issued a press release indicating that it is no longer recommending that shareholders vote for the resolution changing Sherritt's Board size that it requisitioned.

  • In yet another misleading press release, issued on April 10, 2014, Clarke alleged that Sherritt acted inappropriately by sending its' circular to its shareholders when it did and by naming Mr. Haw and Mr. Rapps as dissident nominees. This is a blatantly false and offensive charge.

    • At no time did Clarke Inc. withdraw Mr. Rapps or Mr. Haw as dissident nominees.

    • If Mr. Armoyan had wished for different names to be included in Sherritt's materials, he had more than three months from when he submitted his requisition to advise Sherritt that he was withdrawing Mr. Rapps and Mr. Haw and proposing other nominees in their place.

    • Moreover, Mr. Armoyan and his advisors are well aware that Sherritt's Advance Notice Bylaw does not obligate the corporation to include in its proxy circular or other shareholder communication any information with respect to the proposed dissident nomination or the proposed dissident nominees. Consequently, the Bylaw does not create any expectation that the corporation would delay the mailing of its circular until expiration of the Advance Notice deadline just in case a shareholder were to propose a nominee.

Proxy Voting Instructions

Regardless of how many Sherritt shares you own, it is important you vote your BLUE proxy. Even if you have already voted using the Green Dissident form of proxy, you can still change your vote by voting the BLUE proxy, as only the latest dated proxy will be counted at the meeting.

We encourage shareholders to vote the control number found on your BLUE proxy FOR Sherritt's nominees, no later than 5:00 p.m. (Toronto time) on Friday, May 2, 2014.

For more information or assistance in voting your BLUE proxy, please contact Kingsdale Shareholder Services at 1-800-749-9197 (toll-free), 416-867-2272 (outside North America), or by email at contactus@kingsdaleshareholder.com or go to www.sherritt.com.

About Sherritt

Sherritt is a world leader in the mining and refining of nickel from lateritic ores with operations 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".

Forward-Looking Statements

This press 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. Forward-looking statements in this document include, but are not limited to, statements regarding operating performance, production, commodity prices, priorities and plans, anticipated financial performance, business prospects, and certain corporate objectives, goals and plans. Forward-looking statements are not based on historic facts, but rather on current expectations, assumptions and projections about future events. They are based on information available to management and/or assumptions management believes are reasonable. Many factors could cause results to differ materially from the results discussed in the forward-looking statements. Although the forward-looking statements are based on what management believes to be reasonable assumptions, Sherritt cannot assure investors that actual results will be consistent with such forward-looking statements and such forward-looking statements should not be unduly relied upon. All forward-looking statements in this press release are made as of the date of this press release. Except as required by applicable securities laws, Sherritt does not intend and does not assume any obligations to update or revise the forward-looking statements. The Corporation's risk factors are discussed in disclosure documents filed by Sherritt with Canadian securities regulators. Reference should be made to the management discussion and analysis in Sherritt's annual and interim financial statements and its annual information form for the year ended December 31, 2013 and dated March 26, 2014, all of which are available on SEDAR at www.sedar.com.

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