Sherritt Announces Failure-To-File Cease Trade Order

Sherritt International announced on May 22, 2026, that the Ontario Securities Commission issued a Failure‑to‑File Cease Trade Order (FFCTO) effective May 21, 2026, because the company missed the May 15 deadline to file Q1 2026 financial statements, MD&A, and related certifications. The order prohibits trading of Sherritt securities on Canadian markets, including the TSX. Sherritt attributes the inability to file to operational and governance disruptions caused by the May 1, 2026 U.S. Executive Order expanding sanctions against Cuba. The FFCTO remains in effect until the filings are completed, and the company states it cannot yet determine when that will happen.

The cease‑trade order is the culmination of a rapidly deteriorating situation. Starting May 1 the U.S. expanded sanctions directly targeting Cuba, exposing Sherritt’s deep reliance on its Cuban joint ventures. News releases trace the fallout: - May 4: Assessment of sanctions impact began. - May 7: Sherritt suspended direct participation in Cuban JV activities; repatriated expat employees; three board members resigned. - May 11: The company sought court orders to maintain board functionality and delayed Q1 results to May 15. - May 13: CFO Yasmin Gabriel resigned; external auditor Deloitte resigned, citing no disagreement but effectively walking away; the company warned an FFCTO was likely. - May 15: Sherritt abandoned the Cuban JV dissolution plan that was announced only days earlier and instead announced a preliminary “value preserving opportunity,” while flagging acute liquidity and debt covenant risks. - May 19: The company confirmed it would not proceed with the JV dissolution; continued to evaluate a potential transaction. - May 20: A non‑binding term sheet with Gillon Capital for a warrant placement that, if fully exercised, would give Gillon 55% ownership was disclosed, indicating desperate dilution. - Now, trading is halted.

The most recent news – the actual FFCTO – confirms the predictable outcome: the company cannot produce audited financials under sanctions pressure, has lost its auditor and CFO, and its shares are frozen. This is a material adverse event that directly affects investors’ ability to trade and signals a near‑total breakdown of corporate governance and financial controls. The prior news already priced in severe distress (stock fell from C$0.27 on May 4 to C$0.11‑0.12 by mid‑May), but the formal trading halt materially worsens the risk profile because it removes exit liquidity and implies potential for extended suspension or even delisting. Even the speculative Gillon Capital term sheet, which could hand control to an outside investor at a deep discount, does not mitigate the immediate damage; it underscores the desperate need for a rescue. Thus, the most recent news is material negative.

Sherritt International is a Canadian‑based resource company whose primary asset is a 50% interest in the Moa Joint Venture in Cuba, a large nickel‑cobalt laterite operation. Mixed sulphides from Moa are shipped to the wholly‑owned Fort Saskatchewan refinery in Alberta, where finished nickel and cobalt are produced. The company also holds a one‑third stake in Energas S.A., Cuba’s largest independent energy producer, which generates electricity and historically provided a stable dividend stream. Other small oil & gas interests in Cuba are in exploration phase. All Cuban interests are now under direct threat from expanded U.S. sanctions, and Sherritt’s ability to operate and bank proceeds is severely compromised. The Fort Saskatchewan refinery remains operational only as long as feedstock inventory lasts, which was projected to run out by mid‑June 2026.