Shermag Inc. obtains an extension of CCAA stay order and postpones its motion to approve the transaction with Bermex to August 12, 2009



    SHERBROOKE, QC, Aug. 5 /CNW Telbec/ - Shermag Inc. (TSX: SMG) today
announced that it has obtained an order from the Quebec Superior Court
extending to August 12, 2009 the period of the Court ordered stay of
proceedings against Shermag and its subsidiaries (the "Company") under the
Companies' Creditors Arrangement Act (the "CCAA").
    Additionally, the hearing on the motion to obtain the Court's approval of
the transaction between the Company and Groupe Bermex Inc ("Bermex") further
to Bermex's offer which the Company accepted on July 31 (the "Transaction")
has been postponed to August 12, 2009. This extension will allow the
completion of the discussions surrounding the implementation of the
Transaction with Bermex.
    The Transaction is an essential step towards the completion of Shermag's
restructuring efforts and the presentation of a plan of arrangement to its
creditors. The Transaction will also allow Shermag to preserve the existing
jobs.
    Shermag has been operating under the protection of the CCAA since May 5,
2008.

    Profile

    Shermag Inc., headquartered in Sherbrooke, Québec, designs, produces,
markets and distributes high-quality residential furniture. Shermag presently
has 227 active employees and is a manufacturer and importer with its
manufacturing operations and global sourcing division.

    Disclaimer

    This news release contains forward-looking statements about the Company's
operations, objectives, strategies, financial situation and performance. These
statements are made based on assumptions and management's best estimates with
regard to future events. However, the business of the Company is subject to
risks and uncertainties that could cause actual results to differ from
expected results. Important factors that could cause such differences are
changes in pricing pressure being exerted by competitors, particularly
Asian-based companies, or significant movement in the Canadian/US dollar
exchange rate. This is not an exhaustive list. A broader evaluation of risk
factors that could affect future performance can be found in the Company's
Annual MD&A and Annual Information Form, filed with Canadian securities
regulatory authorities. Given these risks and uncertainties, investors should
not place undue reliance on forward-looking statements as a prediction of
actual results. The Company disclaims any intention or obligation to publicly
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.




For further information:

For further information: Shermag Inc., (819) 566-1515

Organization Profile

SHERMAG INC.

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