UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
Alberta, |
||||
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
(Address of principal executive offices, including zip code)
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class |
Trading Symbol(s) |
Name of Each Exchange on Which Registered | ||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 1.01 | Entry into a Material Definitive Agreement. |
Debt Settlement Agreement
On March 15, 2023, DIRTT Environmental Solutions Ltd. (the “Company”) entered into a debt settlement agreement (the “Debt Settlement Agreement”) with 22NW Fund, LP and Aron English (collectively, “22NW”). Pursuant to the Debt Settlement Agreement, the Company acknowledged it is indebted to and will reimburse 22NW for the costs incurred by 22NW in connection with the Company’s contested director election at the annual and special meeting of shareholders held on April 26, 2022 (the “2022 Meeting”), being $1,559,898 (the “Debt”), in exchange for a release of any and all claims 22NW may have against the Company arising in any way, directly or indirectly, out of the 2022 Meeting.
Pursuant to the Debt Settlement Agreement, the Company has agreed to repay the Debt by either, or a combination of, (a) a payment in cash by the Company to 22NW (the “Cash Payment”) or (b) the issuance of equity securities of the Company to 22NW (the “Security Issuance”). If the Company is unable to make the Cash Payment, then the Company shall repay the Debt with the Security Issuance, subject to approval by the Company’s shareholders, if necessary.
The foregoing is qualified in its entirety by reference to the full text of the Debt Settlement Agreement, a copy of which is filed as an exhibit to this Current Report on Form 8-K and is incorporated herein by reference.
Share Issuance Agreement
Also on March 15, 2023, in connection with the entry into the Debt Settlement Agreement, the Company entered into a share issuance agreement with 22NW (the “Share Issuance Agreement”), pursuant to which the Company agreed to repay the Debt with the issuance of 3,899,745 common shares of the Company (“Common Shares”) to 22NW at a deemed price of $0.40 per Common Share, subject to the approval of a simple majority of votes cast at the 2023 annual and special meeting of the holders of Common Shares (“Shareholder Approval”), excluding any and all Common Shares held by 22NW, as required to be excluded under the rules of the Toronto Stock Exchange (the “TSX”). If the Company is unable to obtain Shareholder Approval, then the Company and 22NW will work in good faith and use commercially reasonable efforts to settle the terms of the repayment of the Debt.
The Security Issuance, if any, is subject to standard regulatory approvals, including the approval of the TSX. The Debt Settlement Agreement and Share Issuance Agreement contain customary representations, warranties and covenants of the Company and 22NW. The Common Shares to be issued pursuant to the Share Issuance Agreement will be offered and sold in reliance upon an exemption from registration provided under Section 4(a)(2) of the Securities Act of 1933.
The foregoing is qualified in its entirety by reference to the full text of the Share Issuance Agreement, a copy of which is filed as an exhibit to this Current Report on Form 8-K and is incorporated herein by reference.
As of the date hereof, 22NW is the Company’s largest shareholder and beneficially owns 19,234,034 Common Shares, representing approximately 19.5% of the Company’s issued and outstanding Common Shares. Aron English is also a director of the Company.
Item 3.02. | Unregistered Sale of Equity Securities. |
The information regarding the Debt Settlement Agreement and the Share Issuance Agreement set forth in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02.
Item 7.01. | Regulation FD Disclosure. |
The Company issued a press release on March 16, 2023 announcing the entry into the Debt Settlement Agreement and Share Issuance Agreement. A copy of that press release is furnished as Exhibit 99.1 to this Current Report and incorporated herein by reference.
2
In accordance with General Instruction B.2 of Form 8-K, the foregoing information, including Exhibit 99.1, shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall such information, including Exhibit 99.1, be deemed incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01. | Financial Statements and Exhibits. |
(d) | Exhibits: |
Exhibit |
Description | |
10.1 | Debt Settlement Agreement, dated March 15, 2023, by and between DIRTT Environmental Solutions Ltd., 22NW Fund, LP and Aron English. | |
10.2 | Share Issuance Agreement, dated March 15, 2023, by and between DIRTT Environmental Solutions Ltd., 22NW Fund, LP and Aron English. | |
99.1* | Press release, dated March 16, 2023. | |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
* | Furnished herewith. |
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: March 21, 2023
DIRTT Environmental Solutions Ltd. | ||
By: | /s/ Nandini Somayaji | |
Nandini Somayaji | ||
Senior Vice President, | ||
General Counsel and Corporate Secretary |
4
Exhibit 10.1
DEBT SETTLEMENT AGREEMENT
THIS DEBT SETTLEMENT AGREEMENT (this Agreement) is made as of the 15th day of March, 2023 (the Effective Date).
AMONG:
DIRTT ENVIRONMENTAL SOLUTIONS LTD., a corporation existing under the laws of Alberta
(the Company)
- and -
22NW FUND, LP, a limited partnership existing under the laws of Delaware
(22NW)
- and -
ARON ENGLISH, an individual residing in City of Seattle in the State of Washington
(English and together with 22NW, the 22NW Group)
WHEREAS:
The Company has agreed to reimburse the 22NW Group collectively in the amount of $1,559,898 for legal fees and other expenses incurred by the 22NW Group in connection with the contested director election at the annual and special meeting of shareholders of the Company held on April 26, 2022 (the Meeting);
NOW THEREFORE, this Agreement witnesses that, for good and valuable consideration, the receipt and sufficiency of which is acknowledged by the Company, 22NW and English (each, a Party and, together, the Parties), the Parties agree as follows:
1. | ACKNOWLEDGEMENT OF INDEBTEDNESS |
1.1 | The Company and the 22NW Group acknowledge and agree that pursuant to this Agreement the Company shall be indebted to the 22NW Group as of the Effective Date in the amount of the $1,559,898 (the Debt) for the reimbursement of legal fees and other expenses incurred by the 22NW Group in connection with the Meeting. |
2. | PAYMENT OF INDEBTEDNESS, ETC. |
2.1 | The Debt will be repaid by either, or a combination of: (i) a payment in cash by the Company to the 22NW Group (the Cash Payment); or/and (ii) by the issuance of equity securities of the Company to the 22NW Group (the Security Issuance). |
2.2 | Upon the execution and delivery of this Agreement, the Company will make disclosure as required under applicable laws with respect to the Debt and account for the Debt as required in its financial statements. |
2.3 | Upon the execution and delivery of this Agreement, the Company and the 22NW Group will work in good faith and use commercially reasonable efforts to, as soon as practicable settle the terms of the Cash Payment and/or the Security Issuance, provided that in any case: |
(a) | the Company shall not make any Cash Payment unless it is in compliance with the Restricted Payments test set forth in the Loan Agreement dated as of February 12, 2021 (as amended, restated, modified or supplemented from time to time) on a pro forma basis; and |
(b) | if the Company is prohibited from making a Cash Payment pursuant to clause (a), the Company shall repay the Debt by way of Security Issuance. |
3. | RELEASE |
3.1 | Upon satisfaction of the obligations under this Agreement, which include payment of the Debt by either of or a combination of the Cash Payment and the Security Issuance, the 22NW Group shall deliver to the Company the form of release attached hereto as Schedule A. |
4. | REPRESENTATIONS AND WARRANTIES |
4.1 | The Company represents and warrants to the 22NW Group that: |
(a) | the Company has the corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder; |
(b) | the Company has taken all requisite corporate action to authorize the execution and delivery of this Agreement and the performance of the Companys obligations hereunder, and none of the foregoing will constitute a breach of, or default under, the articles of incorporation or by-laws of the Company, or any of its subsidiaries, or of any agreement to which it, or any of its subsidiaries, is a party or by which it is bound; and |
(c) | this Agreement has been duly executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms (except in any case as enforcement hereof may be limited by bankruptcy, insolvency, reorganization, and other laws relating to or affecting the rights of creditors generally and except as limited by equitable principles). |
4.2 | Each of English and 22NW represents and warrants to the Company, jointly and severally, that: |
(a) | it has the legal capacity to enter into and execute this Agreement and perform its obligations hereunder and under any other instruments delivered pursuant hereto; |
(b) | they have taken all requisite corporate action to authorize the execution and delivery of this Agreement and the performance of their obligations hereunder, and none of the foregoing will constitute a breach of, or default under, the articles of incorporation or by-laws, as applicable, of a member of the 22NW Group or of any agreement to which any of them is a party or by which any of them are bound; and |
- 2 -
(c) | this Agreement has been duly executed and delivered by the 22NW Group and constitutes a legal, valid and binding obligation of the 22NW Group enforceable against the 22NW Group in accordance with its terms (except in any case as enforcement hereof may be limited by bankruptcy, insolvency, reorganization, and other laws relating to or affecting the rights of creditors generally and except as limited by equitable principles). |
5. GENERAL
5.1 | In this Agreement, words importing the singular number only shall include the plural and vice versa, words importing gender shall include all genders and words importing persons shall include individuals, corporations, partnerships, associations, trusts, unincorporated organizations, governmental bodies and other legal or business entities of any kind. |
5.2 | Any reference to currency is to the lawful currency of the United States unless otherwise indicated. |
5.3 | The 22NW Group acknowledges and agrees that all costs and expenses incurred by the 22NW Group (including any fees and disbursements of any legal counsel retained by the 22NW Group) relating to this Agreement shall be borne by the 22NW Group. |
5.4 | This Agreement and all matters related to or arising from this Agreement are governed by the laws of the Province of Alberta and the federal laws of Canada applicable therein. |
5.5 | This Agreement is not transferable or assignable. |
5.6 | Time shall be of the essence of this Agreement. |
5.7 | If any provision of this Agreement is held to be invalid or unenforceable in any jurisdiction, then: |
(a) such provision shall be deemed amended to conform to applicable laws so as to be valid and enforceable to the fullest possible extent in such jurisdiction, (b) the invalidity or unenforceability of such provision in such jurisdiction shall not affect the validity or enforceability of such provision in any other jurisdiction, and (c) such invalidity or unenforceability of such provision shall not affect the validity or enforceability of any other provision of this Agreement.
5.8 | Except as expressly provided in this Agreement and in the agreements, instruments and other documents contemplated or provided for in this Agreement, this Agreement contains the entire agreement between the Parties with respect to the settlement of the Debt, and there are no other terms, conditions, representations or warranties, whether expressed, implied, oral or written, by statute or common law, by the Company or by anyone else with respect thereto. |
5.9 | This Agreement may only be amended by mutual written agreement of the Parties. |
5.10 | Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be delivered by personal delivery, prepaid courier, or email, addressed as follows: |
(a) | if to the Company: |
7303 - 30th Street S.E.
Calgary, Alberta
T2C 1N6
Attention: Legal Department Telephone: 403-723-5000
Email: legal@dirtt.com
- 3 -
(b) | if to the 22NW Group: 22NW Fund, LP |
1455 NW Leary Way, Ste 400
Seattle, WA 98107
Attention: Aron English
Telephone: (206) 227-307
Email: english@englishcap.com
5.11 | This Agreement may be executed in any number of counterparts, each of which, when so executed and delivered, shall constitute an original and all of which together shall constitute one instrument. |
5.12 | Delivery of an executed copy of this Agreement by electronic means, including by DocuSign or electronic transmission in portable document format (.pdf), shall be equally effective as delivery of a manually executed copy of this Agreement. |
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
- 4 -
IN WITNESS WHEREOF the Parties have executed this Agreement as of the date first stated above.
DIRTT ENVIRONMENTAL SOLUTIONS LTD. | ||
Per: | /s/ Ken Sanders | |
Name: Ken Sanders Title: Board Chair |
22NW FUND, LP | ||
Per: |
/s/ Aron English | |
Name: Aron English Title: Manager of General Partner, 22NW Fund GP, LLC | ||
/s/ Aron English | ||
ARON ENGLISH |
SCHEDULE A
FORM OF RELEASE
TO: DIRTT ENVIRONMENTAL SOLUTIONS LTD. (the Company)
IN CONSIDERATION for the cash payment or issuance of securities of the Company by the Company, or a combination thereof, as payment in full of the US$1,559,898 debt (the Debt) outstanding to Aron English and 22NW Fund, LP (together, the 22NW Group), collectively, for legal fees and other expenses incurred by the 22NW Group in connection with the contested director election at the annual and special meeting of shareholders of the Company held on April 26, 2022 (the Meeting), and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, each of the undersigned, on behalf of itself and its successors and assigns (collectively referred to as, the Releasor), does hereby remise, release and forever discharge: (i) the Company from any claims for reimbursement of expenses incurred by the 22NW Group in relation to the Meeting; and (ii) the Companys present and future directors, officers, and employees of and from all actions, causes of action, suits, debts, dues, controversies, accounts, bonds, bills, covenants, contracts, agreements, judgments, claims, costs, obligations, charges, security interests and demands whatsoever, in law or in equity, which may be related to any claims the Releasor now has, ever had or hereafter can, shall or may have against the Company for or by reason of or in any way arising, directly or indirectly, out of the Meeting.
In executing this Release, the Releasor acknowledges that the Releasor has relied on the Releasors own judgment, belief and knowledge and that of the Releasors counsel and has in no way relied on or been induced by any representation, statement, act or omission to act by the Company. The Releasor shall not at any time attempt to rescind, reform or in any way modify or challenge the validity of this Release or any part hereof.
This Release shall be governed by the laws of the Province of Alberta.
IN WITNESS WHEREOF the undersigned has executed this Release this [] day of [], 2023.
Exhibit 10.2
SHARE ISSUANCE AGREEMENT
THIS SHARE ISSUANCE AGREEMENT (this Agreement) is made as of the 15th day of March, 2023 (the Effective Date).
AMONG:
DIRTT ENVIRONMENTAL SOLUTIONS LTD., a corporation existing under the laws of Alberta
(the Company)
- and -
22NW FUND, LP, a limited partnership existing under the laws of Delaware
(22NW)
- and -
ARON ENGLISH, an individual residing in City of Seattle in the State of Washington
(English and together with 22NW, the 22NW Group)
WHEREAS:
A. | The Company and the 22NW Group entered into a debt settlement agreement dated effective March 13, 2023 (the Debt Settlement Agreement), pursuant to which the Company agreed to reimburse the 22NW Group collectively in the amount of US$1,559,898 (the Debt) for legal fees and other expenses incurred by the 22NW Group in connection with the contested director election at the annual and special meeting of shareholders of the Company held on April 26, 2022 (the 2022 Meeting); |
B. | Pursuant to the Debt Settlement Agreement, the Company and 22NW Group agreed to work in good faith and use commercially reasonable efforts to, as soon as practicable, settle the terms of the repayment of the Debt by either, or a combination of: (i) a payment in cash by the Company to the 22NW Group; and/or (ii) the issuance of equity securities of the Company to the 22NW Group; and |
C. | The Company and the 22NW Group wish to settle the Debt by way of the issuance of equity securities of the Company to the 22NW Group as set forth in this Agreement; |
NOW THEREFORE, this Agreement witnesses that, for good and valuable consideration, the receipt and sufficiency of which is acknowledged by the Company, 22NW and English (each, a Party and, together, the Parties), the Parties agree as follows:
1. | PAYMENT OF INDEBTEDNESS, ETC. |
1.1 | Subject to section 1.3, the Debt will be repaid by the issuance to the 22NW Group of 3,899,745 common shares in the capital of the Company (Common Shares) at a deemed price US$0.40 per Common Share (the Share Issuance). |
1.2 | Upon the execution and delivery of this Agreement, the Company will make disclosure as required under applicable laws with respect to the Share Issuance. |
1.3 | The Share Issuance is subject to the holders of Common Shares approving, by a simple majority of votes cast (excluding those Common Shares held by the 22NW Group, as required to be excluded under the rules of the Toronto Stock Exchange (the TSX) and the Nasdaq Capital Market (Nasdaq), the proposal relating to the Share Issuance (Shareholder Approval) as required by the TSX and Nasdaq at the 2023 annual and special meeting of the holders of Shares (the 2023 Meeting). |
1.4 | If Shareholder Approval is not obtained at the 2023 Meeting, the Company and the 22NW Group will work in good faith and use commercially reasonable efforts to, as soon as practicable, settle the terms of the repayment of the Debt by either, or a combination of: (i) a payment in cash by the Company to the 22NW Group (the Cash Payment); and/or (ii) the issuance of equity securities of the Company to the 22NW Group (the Security Issuance), provided that in any case: |
(a) | the Company shall not make any Cash Payment unless it is in compliance with the Restricted Payments test set forth in the Loan Agreement dated as of February 12, 2021 (as amended, restated, modified or supplemented from time to time) (the Loan Agreement) on a pro forma basis; and |
(b) | if the Company is prohibited from making a Cash Payment pursuant to clause (a), the Company shall repay the Debt by way of Security Issuance. |
2. | REPRESENTATIONS AND WARRANTIES |
2.1 | The Company represents and warrants to the 22NW Group that: |
(a) | the Company has the corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder; |
(b) | the Company has taken all requisite corporate action to authorize the execution and delivery of this Agreement and, subject to the receipt of Shareholder Approval, the performance of the Companys obligations hereunder, and none of the foregoing will constitute a breach of, or default under, the articles of incorporation or by-laws of the Company, or any of its subsidiaries, or of any agreement to which it, or any of its subsidiaries, is a party or by which it is bound; |
(c) | this Agreement has been duly executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms (except in any case as enforcement hereof may be limited by bankruptcy, insolvency, reorganization, and other laws relating to or affecting the rights of creditors generally and except as limited by equitable principles); |
(d) | the Companys information circular for the 2023 Meeting will contain a recommendation that holders of Common Shares vote to approve the Share Issuance; and |
(e) | the Common Shares issued pursuant to the Share Issuance will be duly and validly issued as fully paid and non-assessable Common Shares. |
2.2 | Each of English and 22NW represents and warrants to the Company, jointly and severally, that: |
(a) | it has the legal capacity to enter into and execute this Agreement and perform its obligations hereunder and under any other instruments delivered pursuant hereto; |
(b) | they have taken all requisite corporate action to authorize the execution and delivery of this Agreement and the performance of their obligations hereunder, and none of the foregoing will constitute a breach of, or default under, the articles of incorporation or by-laws, as applicable, of a member of the 22NW Group or of any agreement to which any of them is a party or by which any of them are bound; and |
(c) | this Agreement has been duly executed and delivered by the 22NW Group and constitutes a legal, valid and binding obligation of the 22NW Group enforceable against the 22NW Group in accordance with its terms (except in any case as enforcement hereof may be limited by bankruptcy, insolvency, reorganization, and other laws relating to or affecting the rights of creditors generally and except as limited by equitable principles). |
3. | GENERAL |
3.1 | In addition to the terms set out in this Agreement, the repayment of the Debt shall be subject to the terms and conditions of the Debt Settlement Agreement. In the event of any conflict or inconsistency between the Debt Settlement Agreement and this Agreement, the terms of this Agreement shall prevail. |
3.2 | In this Agreement, words importing the singular number only shall include the plural and vice versa, words importing gender shall include all genders and words importing persons shall include individuals, corporations, partnerships, associations, trusts, unincorporated organizations, governmental bodies and other legal or business entities of any kind. |
3.3 | Any reference to currency is to the lawful currency of the United States unless otherwise indicated. |
3.4 | The 22NW Group acknowledges and agrees that all costs and expenses incurred by the 22NW Group (including any fees and disbursements of any legal counsel retained by the 22NW Group) relating to this Agreement shall be borne by the 22NW Group. |
3.5 | This Agreement and all matters related to or arising from this Agreement are governed by the laws of the Province of Alberta and the federal laws of Canada applicable therein. |
3.6 | This Agreement is not transferable or assignable. |
3.7 | Time shall be of the essence of this Agreement. |
3.8 | If any provision of this Agreement is held to be invalid or unenforceable in any jurisdiction, then: |
(a) such provision shall be deemed amended to conform to applicable laws so as to be valid and enforceable to the fullest possible extent in such jurisdiction, (b) the invalidity or unenforceability of such provision in such jurisdiction shall not affect the validity or enforceability of such provision in any other jurisdiction, and (c) such invalidity or unenforceability of such provision shall not affect the validity or enforceability of any other provision of this Agreement. |
3.9 | Except as expressly provided in this Agreement and in the agreements, instruments and other documents contemplated or provided for in this Agreement, this Agreement contains the entire agreement between the Parties with respect to the settlement of the Debt, and there are no other terms, conditions, representations or warranties, whether expressed, implied, oral or written, by statute or common law, by the Company or by anyone else with respect thereto. |
3.10 | This Agreement may only be amended by mutual written agreement of the Parties. |
3.11 | Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be delivered by personal delivery, prepaid courier, or email, addressed as follows: |
(a) | if to the Company: |
7303 - 30th Street S.E.
Calgary, Alberta
T2C 1N6
Attention: Legal Department
Telephone: 403-723-5000
Email: legal@dirtt.com
(b) | if to the 22NW Group: |
22NW Fund, LP
1455 NW Leary Way, Ste 400
Seattle, WA 98107
Attention: Aron English
Telephone: (206) 227-307
Email: english@englishcap.com
3.12 | This Agreement may be executed in any number of counterparts, each of which, when so executed and delivered, shall constitute an original and all of which together shall constitute one instrument. |
3.13 | Delivery of an executed copy of this Agreement by electronic means, including by DocuSign or electronic transmission in portable document format (.pdf), shall be equally effective as delivery of a manually executed copy of this Agreement. |
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF the Parties have executed this Agreement as of the date first stated above.
DIRTT ENVIRONMENTAL SOLUTIONS LTD. | ||
Per: | /s/ Ken Sanders | |
Name: Ken Sanders Title: Board Chair | ||
22NW FUND, LP | ||
Per: | /s/ Aron English | |
Name: Aron English Title: Manager of General Partner, 22NW Fund GP, LLC | ||
/s/ Aron English | ||
ARON ENGLISH |
Exhibit 99.1
DIRTT Agrees to Reimburse 22NW for Expenses Related to Contested Director Election
CALGARY, Alberta, March 16, 2023DIRTT Environmental Solutions Ltd. (DIRTT or the Company) (TSX:DRT, NASDAQ:DRTT), a global leader in industrialized construction, is pleased to announce it has entered into agreements with Aron English and 22NW Fund, L.P. (collectively, 22NW), where the Company acknowledges it is indebted to and will reimburse 22NW for the expenses incurred by 22NW in connection with the Companys contested director election at the annual and special meeting of shareholders held on April 26, 2022. The total expenses to be reimbursed are US$1,559,898. Subject to the receipt of shareholder approval, which is required under the rules of the Toronto Stock Exchange (TSX) and the Nasdaq Capital Market (Nasdaq), the Company has agreed to issue common shares as settlement of the debt. The issuance of the shares, priced at US$0.40, will be put before the Companys shareholders for consideration and approval at the Companys upcoming 2023 annual and special meeting.
Ken Sanders, Board Chair of DIRTT, commented As the prevailing party in last years contested director election, it is appropriate that 22NW be reimbursed for the expenses they incurred. We believe a share reimbursement approach allows DIRTT to further strengthen our balance sheet and better positions the Company for long-term success, while the pricing fairly reflects the extended duration of the obligation as well as the trading restrictions attached to the issued shares. On behalf of the Board of Directors, we are pleased to turn the page of this chapter in DIRTTs journey. Together, our highly collaborative Board and executive team all of whom are now shareholders in the Company continue to apply our full attention to creating differentiated value for our clients, partners, employees, and shareholders.
The issuance of the Shares is subject to standard regulatory approvals, including the approval of the TSX, which has not yet been obtained.
ABOUT DIRTT
DIRTT is a global leader in industrialized construction. Its integrated system of physical products and digital tools empowers organizations, together with construction and design leaders, to build high-performing, adaptable, interior environments. Operating in the workplace, healthcare, education and public sector markets, DIRTTs system offers total design freedom, and greater certainty in cost, schedule and outcomes. Headquartered in Calgary, Alberta, Canada, DIRTT trades on Nasdaq under the symbol DRTT and on the TSX under the symbol DRT.
FORWARD LOOKING STATEMENTS:
This news release contains forward-looking information within the meaning of applicable securities legislation, which reflects the Companys current expectations regarding future events, including statements about the issuance of shares to 22NW and timing thereof; the required regulatory and shareholder approvals and the timing thereof; the effect of the share issuance on DIRTTs balance sheet and position for long-term success; trading restrictions applicable to the issued shares; and
the value creation for DIRTTs clients, partners, employees and shareholders. In some cases forward-looking information can be identified by such terms as will and expected. Forward-looking statements are based on certain estimates, beliefs, expectations, and assumptions made in light of managements experience and perception of historical trends, current conditions and expected future developments, as well as other factors that may be appropriate.
Forward-looking statements necessarily involve unknown risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed or implied in such statements. Due to the risks, uncertainties, and assumptions inherent in forward-looking information, you should not place undue reliance on forward-looking statements. Factors that could have a material adverse effect on our business, financial condition, results of operations and growth prospects include, but are not limited to, the severity and duration of the COVID-19 pandemic and related economic repercussions and other risks described under the section titled Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the U.S. Securities and Exchange Commission and applicable securities commissions or similar regulatory authorities in Canada on February 22, 2023. Our past results of operations are not necessarily indicative of our future results. You should not rely on any forward-looking statements, which represent our beliefs, assumptions and estimates only as of the dates on which they were made, as predictions of future events. We undertake no obligation to update these forward-looking statements, even though circumstances may change in the future, except as required under applicable securities laws. We qualify all of our forward-looking statements by these cautionary statements.
FOR MORE INFORMATION, PLEASE CONTACT
DIRTT Investor Relations at ir@dirtt.com
Document and Entity Information |
Mar. 15, 2023 |
---|---|
Cover [Abstract] | |
Entity Registrant Name | DIRTT ENVIRONMENTAL SOLUTIONS LTD |
Entity Tax Identification Number | 00-0000000 |
Amendment Flag | false |
Entity Central Index Key | 0001340476 |
Document Type | 8-K |
Document Period End Date | Mar. 15, 2023 |
Entity Incorporation State Country Code | Z4 |
Entity File Number | 001-39061 |
Entity Address, Address Line One | 7303 30th Street S.E. |
Entity Address, City or Town | Calgary |
Entity Address, State or Province | AB |
Entity Address, Postal Zip Code | T2C 1N6 |
City Area Code | (403) |
Local Phone Number | 723-5000 |
Written Communications | false |
Soliciting Material | false |
Pre Commencement Tender Offer | false |
Pre Commencement Issuer Tender Offer | false |
Security 12b Title | Common Shares, without par value |
Trading Symbol | DRTT |
Security Exchange Name | NASDAQ |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | true |
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end
.MA
MOPX @'>7'L>P .\3
M=\;'0L<7PTJNUB;%_H;*-=<(V-=B.O,L@)B^8D1 _1+,/?=:6W-K:HD00 PR
M[\]!^_%QC\M.C,J#K(LX:U/8X)&))ZW&1WP@.(3^+S_PZQB+:L
M&(I;XR14# R$1G[#,S\7#"1U@OZ8K6 N!U43PSWH3=FMHIB[WTI<6K/(PJ'EX-=H'EG3-"3I+=/=3'A?;@[5F@H5
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MMI*Z9:5MD+\;TJ<8K$W?S'3V=4G>]>D(8&OBN'_,!==]'2)*