Sherritt Announces Closing of $132 Million Unit Offering

TORONTO–(BUSINESS WIRE)–Sherritt International Corporation (“Sherritt”) (TSX:S):

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES

Sherritt International Corporation (“Sherritt” or the “Company”) (TSX:S)
today closed its previously announced unit offering including the full
exercise of an over-allotment option granted to its agents. A total of
94,464,400 units (the “Units”) of the Company were sold at a price of
$1.40 per Unit for gross proceeds of approximately $132 million.

Each Unit consists of one Sherritt common share (a “Common Share”) and
one-half of one common share purchase warrant linked to the price of
cobalt (each full warrant, a “Cobalt-Linked Warrant”). Each full
Cobalt-Linked Warrant will be exercisable at an exercise price of $1.95
for a period of 36 months, effective from today.

Paradigm Capital, Eight Capital and National Bank Financial acted as
co-lead agents and joint-bookrunners on behalf of a syndicate that
included TD Securities (collectively, the “Agents”). The Agents received
a cash commission equal to 5.5% of the gross proceeds raised in
consideration for their services.

The Cobalt-Linked Warrants are expected to begin trading on the TSX on
January 25, 2018 under the symbol S.WT. Each Cobalt-Linked Warrant will
be exercisable to acquire between 1.00 and 1.25 Common Shares of
Sherritt, determined based on the Applicable Reference Cobalt Price (as
defined below), subject to adjustment in accordance with the warrant
indenture. The Cobalt-Linked Warrants have been structured to provide
investors with increased leverage to upwards movement in the price of
cobalt.

Each Cobalt-Linked Warrant will entitle the holder thereof to acquire
that number of Common Shares that is equal to the Common Shares per
Warrant Ratio. The Common Shares per Warrant Ratio will be determined
and published on the fifth business day of each month, based on the
Applicable Reference Cobalt Price per Pound in accordance with the
following table:

The Applicable Reference Cobalt Price per Pound will be calculated and
published by Sherritt monthly, based on a rolling average of the prior
three consecutive full calendar months’ cobalt price using the midpoint
of the Metal Bulletin High Price and the Metal Bulletin Low Price1,
expressed in US dollars per pound, for each month in such three-month
period. The initial Common Shares per Warrant Ratio will be 1.0 based on
an initial Applicable Reference Cobalt Price of US$31.60. The next
Applicable Reference Cobalt Price and Common Shares per Warrant Ratio
will be published on February 7, 2018.

The net proceeds of the Offering will be used to reduce Sherritt’s
outstanding indebtedness, for general corporate purposes and to fund
future growth initiatives. Sherritt intends to use the proceeds of the
Offering and its existing cash balance to repurchase a portion of one or
more of each of its senior unsecured debentures (the “Debentures”) for a
targeted aggregate principal amount of up to $75 million. The
Debentures will be repurchased under the terms of a modified Dutch
auction tender offer (the “Tender Offer”). For further details of the
Tender Offer, investors are advised to consult Sherritt’s press release
dated January 16, 2018, entitled Sherritt Announces Dutch Auction to
Purchase up to $75 Million of Outstanding Debentures.

The securities described herein have not been, and will not be,
registered under the U.S. Securities Act, or any state securities laws,
and accordingly, may not be offered or sold to, or for the account or
benefit of, persons in the United States or to U.S. Persons (as such
term is defined in Regulation S under the U.S. Securities Act), except
in compliance with the registration requirements of the U.S. Securities
Act and applicable state securities requirements or pursuant to
exemptions therefrom. This press release does not constitute an offer to
sell or a solicitation of an offer to buy any of Sherritt’s securities
to, or for the account or benefit of, persons in the United States or
U.S. Persons.

About Sherritt

Sherritt is a world leader in the mining and refining of nickel and
cobalt from lateritic ores with projects and 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. Specifically, forward-looking statements in this
document include, but are not limited to, statements set out in this
press release relating to estimated costs and future funding
requirements.

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 transaction disclosed herein;
availability of governmental, regulatory and third party approvals; and
the ability to achieve corporate objectives, goals and plans for 2018.
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 may differ materially from such
predictions, forecasts, conclusions or projections.

The Corporation cautions readers of this press 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 the
risks and uncertainties set out in the Management’s Discussion &
Analysis of the Corporation for the period ending September 30, 2017 and
the Corporation’s Annual Information Form dated March 28, 2017, each of
which are available on SEDAR at www.sedar.com.
Readers are cautioned that the foregoing list of factors is not
exhaustive and should be considered in conjunction with the risk factors
described in this press release and in the Corporation’s other documents
filed with the Canadian securities authorities.

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 press 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 press 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.

1 The “Metal Bulletin High Price” means the Cobalt low
grade Metal Bulletin free market US$/lb in warehouse monthly average
high; the “Metal Bulletin Low Price” means the Cobalt low grade
Metal Bulletin free market US$/lb in warehouse monthly average low.

Contacts

Sherritt
Joe Racanelli, 416-935-2457
Director of Investor
Relations
Toll-Free: 1-800-704-6698
[email protected]
www.sherritt.com