DIRTT PROVIDES AN UPDATE ON ITS ANNUAL AND SPECIAL MEETING
OF SHAREHOLDERS AND 22NW
CALGARY, ALBERTA, MARCH 15, 2022 – DIRTT Environmental Solutions Ltd. (“DIRTT” or the “Company”) (Nasdaq: DRTT, TSX: DRT), an interior construction company that uses proprietary software to design, manufacture and install fully customizable environments, today announced updates regarding its annual and special meeting of shareholders scheduled to be held on April 26, 2022 (the “Meeting”) and 22NW Fund, LP (“22NW”).
DIRTT Remains Committed to Having Shareholders Exercise their Voting Rights at the Meeting
As announced in the Company’s December 7, 2021 press release, after careful deliberation, and with the interests of all shareholders of the Company in mind, the Company’s board of directors (the “Board”) determined the date of the Meeting based on the several factors outlined in such press release and consistent with the proper exercise of its fiduciary duty. The Board remains committed to holding the Meeting on April 26, 2022 (the “Meeting Date”), yet on March 11, 2022, counsel to 22NW sent a letter to counsel to the Company (the “March 11 Letter”) requesting confirmation that the Board will not seek to adjourn the Meeting. In the March 11 Letter, 22NW indicated that it intended to initiate legal action if such confirmation was not promptly received. The March 11 Letter did not mention that 22NW would, within a period of less than three hours, supplement its November 17, 2021 requisition (the “Requisition”) by providing notice to the Company that it would seek to nominate 7 rather than 6 persons to the Board. Despite the March 11 Letter and 22NW’s subsequent supplement to its Requisition, the Company does not intend to change the Meeting Date.
22NW’s March 4, 2022 Press Release
In its March 4, 2022 press release, 22NW claimed that the Alberta Securities Commission (the “ASC”) had “dismissed all claims against 22NW”. On March 4, 2022, the ASC rendered its decision, concluding that the respondents in such proceedings were not acting jointly or in concert, and declined to grant any of the relief sought by the Company. However, the ASC found 22NW’s 29-day late filing to be an ordinary course compliance issue under the alternative monthly reporting regime designed to protect minority shareholders, but the ASC declined to determine whether 22NW had also made an incorrect alternative monthly report. The ASC held that no remedy against 22NW was warranted since the disclosure 22NW was otherwise required to make under the applicable securities laws had subsequently been made. The ASC observed that the delinquent or inaccurate filings were not properly the subject of enforcement orders under its public interest jurisdiction. Accordingly, the Company stands by its statement that 22NW breached securities laws and continues to believe this is an important factor for shareholders to consider in voting at the Meeting.
In making its ruling, the ASC Panel noted orally that it believed the application by the Company was ill-conceived and an imprudent use of DIRTT’s resources. The Company respectfully disagrees with the ASC’s decision not to impose consequences on 22NW for the late filing and respectfully disagrees about the characterization of DIRTT’s application.
Does 22NW Have a Plan?
We cannot read the minds of 22NW and its principal, Mr. English, so we cannot say what their true motivations are in seeking to replace all of the Board. Since the Requisition was issued, we have repeatedly noted that it appears that 22NW and its principal, Mr. English, have no new plan for the Company. If 22NW and Mr. English have a new plan, they have neither provided it to the Company nor made it publicly available for shareholders. Where is the plan?
Amendment of March 7 Press Release
This press release supplements and amends the Company’s March 7, 2022 press release.
