| Item 1.02. | Termination of a Material Definitive Agreement |
The information set forth in Item 3.03 of this Current Report on Form 8-K is incorporated into this Item 1.02 by reference.
| Item 3.03. | Material Modification to Rights of Security Holders |
On December 7, 2021, the board of directors (the “Board”) of DIRTT Environmental Solutions Ltd. (the “Company”) adopted a shareholder rights plan. One right (a “Right”) was issued and attached to each common share of the Company outstanding and held of record at the close of business on December 17, 2021. The terms of the Rights were set forth in a shareholder rights plan agreement, dated as of December 7, 2021 (the “Effective Date”), by and between the Company and Computershare Trust Company of Canada, as rights agent (the “Rights Agreement”).
At the Company’s 2022 annual and special meeting of shareholders (the “Meeting”) held on April 26, 2022, shareholders were asked to ratify, confirm and approve the Rights Agreement. The Rights Agreement was not approved by shareholders at the Meeting and, as such, the Rights Agreement and all outstanding Rights thereunder terminated and became void and of no further force and effect at such time.
| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers |
Departure and Appointment of Directors.
The Company held its Meeting on April 26, 2022. Based on the voting results of the Meeting, effective immediately thereafter: (i) each of Michael T. Ford, Denise E. Karkkainen, Shauna R. King, Todd W. Lillibridge, James (Jim) A. Lynch, Steven E. Parry and Diana R. Rhoten ceased to be a director of the Company; and (ii) each of Douglas A. Edwards, Aron R. English, Mary Garden, Cory J. Mitchell, Scott L. Robinson, Scott C. Ryan and Kenneth D. Sanders has been elected as a director of the Company.
Departure of Interim Chief Executive Officer and Director
At the Company’s Meeting on April 26, 2022, Todd Lillibridge was not elected by shareholders and ceased to be a director of the Company and its affiliates. Following the Company’s Meeting, Mr. Lillibridge’s appointment as the Interim President and Chief Executive Officer of the Company was terminated. Mr. Lillibridge will be entitled to the rights and payments set forth in his Letter Agreement dated January 18, 2022. Mr. Lillibridge’s Letter Agreement was filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 19, 2022. The foregoing summary of Mr. Lillibridge’s rights under the Letter Agreement does not purport to be complete and is qualified in its entirety by reference to that agreement, which is incorporated herein by reference.
Appointment of Interim Chief Executive Officer
On April 26, 2022, the Board appointed Jeffrey Calkins and Geoffrey Krause to serve as Interim Co-Chief Executive Officers effective immediately until a replacement is named (the “Service Period”). The Board has retained an executive search firm to identify a permanent Chief Executive Officer replacement.
Jeffrey Calkins, 62, has served as the Company’s Chief Operating Officer since March 2019, having served as the Company’s interim Chief Operating Officer from January 2019 until he was named to the role permanently. Prior to joining the Company, Mr. Calkins was a Principal Partner and the President of Manufacturing Resources, Inc., an interim management and consulting firm, from 2001 to 2019. Mr. Calkins holds a Master of Science degree in Industrial Administration and a Bachelor of Science degree in Industrial Engineering from Purdue University.
Geoffrey Krause, 52, has served as the Company’s Chief Financial Officer since June 2018. Prior to joining DIRTT, Mr. Krause served as the Chief Financial Officer of Pure Technologies Ltd., a company that developed and managed innovative technologies for critical infrastructure, from 2014 to 2018 before it was acquired by Xylem Inc. From 2010 to 2014, he served as Vice President, Internal Reporting of Tervita Corporation. Mr. Krause holds a Bachelor of Administration degree with distinction from the University of Regina and is a Chartered Professional Accountant (Chartered Professional Accountants Alberta).
Neither Mr. Calkins nor Mr. Krause has any family relationship with any other director or executive officer of the Company. Neither Mr. Calkins nor Mr. Krause has entered into any transactions since January 1, 2022, or any currently proposed transaction, with a director or executive officer (or immediate family member thereof) of the Company, exceeding $120,000, in which Mr. Calkins or Mr. Krause had or will have a direct or indirect material interest.
2
