DIRTT Environmental Solutions Ltd. (“DIRTT” or the “Company”) (TSX:DRT, NASDAQ:DRTT), an interior construction company that uses proprietary software to design, manufacture and install fully customizable environments, is pleased to announce the successful closing of the issue and sale of C$35 million aggregate principal amount of 6.25% convertible unsecured subordinated debentures (the "Debentures"). The Debentures were offered to the public (the “Offering”) through a syndicate of underwriters (the "Underwriters") led by National Bank Financial Inc. The Company has also granted the Underwriters an over-allotment option to purchase up to an additional C$5.25 million aggregate principal amount of Debentures on the same terms, exercisable in whole or in part at any time up to the 30th day following the closing of the Offering.
The Company intends to use a portion of the net proceeds of the Offering, together with cash reserves on hand, to fund its anticipated 2022 capital expenditure program of approximately US$7.0 million, comprised of approximately US$2.5 million related to refreshes of DIRTT Experience Centers, continued enhancement of the Company’s customer relationship management system and website redesign, approximately US$2.5 million on software development and approximately US$2.0 million on manufacturing and other capital upgrades. The remaining net proceeds of the Offering are expected to be used, initially, to support the continued funding of the Company’s manufacturing and commercial activities as the COVID-19 pandemic recovery occurs, and to provide incremental liquidity to support the Company’s operations and growth objectives.
The Debentures were offered in Canada (excluding Quebec) pursuant to a short form prospectus under Canadian law and in the United States pursuant to a shelf registration statement on Form S-3 (File No. 333-251660) previously filed with the U.S. Securities and Exchange Commission (the “SEC”), and in certain other jurisdictions as were agreed by the Underwriters and the Company. Offers, solicitations and sales of the Debentures or common shares of DIRTT are made only by means of the prospectus supplement to the shelf registration statement on Form S-3 in the United States and the short form prospectus in Canada (excluding Quebec). The U.S. prospectus supplement and Canadian short form prospectus relating to, and describing the terms of, the Offering are filed with and available on the SEC’s website at www.sec.gov and SEDAR at sedar.com, as applicable. Electronic copies of the U.S. prospectus supplement and Canadian short form prospectus, may also be obtained by contacting National Bank Financial Inc. at 130 King Street West, Suite 3200, Toronto, ON M5X 1J9, by telephone at (416)-869-6534 or e-mail at ECM-Origination@nbc.ca.
The Debentures will be listed on the Toronto Stock Exchange under the symbol “DRT.DB.A”.
This press release does not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
This news release contains forward-looking information within the meaning of applicable securities legislation, which reflects the Company's current expectations regarding future events, including statements about the Offering and the proposed use of proceeds. In some cases forward-looking information can be identified by such terms as "will" and "expected". Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company's control that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. The Company's estimates, beliefs and assumptions, which may prove to be incorrect, including those relating to the Company's use of proceeds from the Offering. The risks and uncertainties that may affect forward-looking information include, but are not limited to, market conditions, the effect of COVID-19 on the Company's operations, business and financial results, and other factors discussed under "Risks Factors" in the Company’s management's discussion and analysis for the three and nine months ended September 30, 2021 and in the Company's Annual Report on Form 10-K for the year ended December 31, 2020, both of which are available on SEDAR (www.sedar.com) and on the SEC’s website (www.sec.gov). The Company does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law. This forward-looking information speaks only as of the date of this news release.
DIRTT is a global leader in industrialized construction. Its 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 commercial, healthcare, education, and public sector markets, DIRTT’s system provides total design freedom, and greater certainty in cost, schedule, and outcomes. Headquartered in the US and Canada, DIRTT trades on Nasdaq under the symbol “DRTT” and on the Toronto Stock Exchange under the symbol “DRT”.