(Correcting fourth paragraph to reflect that statement came out Wednesday)
Sherritt International Corporation (S.TO) on Wednesday continued its almost daily practice of proving a further update on activities in Cuba.
Today, Sherritt said it has entered into a non-binding term sheet with Gillon Capital, LLC with respect to a proposed private placement of a common share purchase warrant. A statement noted the warrant is exercisable for up to that number of common shares of the corporation such that, immediately upon exercise in full of the warrant, Gillon Capital would own 55% of the common shares then issued and outstanding. The warrant will be exercisable at a price to be agreed by the parties for a period ending nine months from the closing date, subject to satisfaction of certain conditions precedent, including compliance with the corporation's existing contractual arrangements and debt agreements.
Given the current circumstances of the corporation, management expects that such exercise price will be at a discount to the closing price of the common shares on May 15, 2026, it added.
Wednesday's statement noted the private placement remains subject to the execution of definitive documentation and the transaction is expected to be subject to the satisfaction of customary conditions and the receipt of all required regulatory approvals, including approval of the Toronto Stock Exchange. There can be no assurance that the private placement will be completed, completed on the terms described above, or completed in a timely manner.
In connection with the private placement, Sherritt said it has engaged "constructively" with the United States Department of State, which has confirmed that the Department of State and Department of Treasury do not object to Gillon Capital's engagement in negotiations with the corporation and, based on the information provided to date, do not consider such negotiations to be contrary to U.S. law. Any subsequent transaction will be subject to approval of the Department of State and Department of Treasury, it added.