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DIRTT Files Preliminary Proxy Statement for Annual and Special Meeting of Shareholders

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 that it has filed a preliminary proxy statement (the “Preliminary Proxy Statement”) with the Securities and Exchange Commission (the “SEC”) for its annual and special meeting of shareholders scheduled to be held on April 26, 2022 (the “Meeting”). The Company also announced that it intends to nominate Mr. Charlie Chiappone for election to the board of directors (the “Board”) at the Meeting, as well as six of the seven current directors of the Company. As previously announced, Mr. Steven E. Parry will not be standing for re-election at the Meeting.

The nomination of Mr. Chiappone comes after an extensive, competitive process by a leading international executive search firm and was guided by the comprehensive skills matrix reflected in the Company’s strategic Board renewal plan. Mr. Chiappone represents the fifth new director nomination in the last 20 months and one more step in the Company’s intensive renewal process that has been underway since 2017, resulting in the assembly of the right balance of functional, experiential and personal attributes required to add value in the context of DIRTT’s strategic priorities.

Mr. Chiappone has served as Senior Vice President of Ceiling and Wall Solutions for Armstrong World Industries, Inc. (“AWI”), an international designer and manufacturer of walls, ceilings and suspension systems, since 2016 and will retire from that role in April of this year. He joined AWI in 2012 as Vice President, Global Marketing, and from 2013 through 2016 he served as Chief Executive Officer of the Worthington Armstrong Venture (WAVE), AWI’s 50%-owned ceiling suspension systems joint venture with Worthington Industries. Prior to joining AWI, Mr. Chiappone served as President and CEO of Alloy Polymers, a global plastics manufacturer, where he implemented strategic growth and continuous improvement initiatives. He also held several senior management positions in marketing, research and development, operations and general management with SPX Cooling Technologies, a division of SPX Corporation. He began his career at General Electric where he worked in a variety of commercial positions, after serving four years in the United States Marine Corps. He holds a bachelor’s degree in Marketing and Management from Siena College and an MBA from Northwestern University’s Kellogg Graduate School of Management.

The Meeting will cover both normal course matters and matters relating to the requisition made by activist investor 22NW Fund, LP (the “Activist”). As the Company intends to nominate seven individuals for election to the Board at the Meeting and the Activist intends to nominate six individuals, the Meeting is a “contested election” and the Company’s majority voting policy will not apply to the election of directors at the Meeting. Since the number of nominees for election to the Board is greater than the number of vacancies, the seven nominees who receive the greatest number of votes will be elected.

The Preliminary Proxy Statement is subject to review by the SEC before finalization. Upon completion of the SEC review process, DIRTT will file a definitive proxy statement (the “Definitive Proxy Statement”) and accompanying BLUE proxy card with the SEC and under the Company’s profile on SEDAR at www.sedar.com, and will mail the Definitive Proxy Statement and BLUE proxy card to shareholders.

Special Note Regarding Forward-Looking Statements

This news release contains forward-looking information within the meaning of applicable securities legislation, which reflects the Company’s current expectations regarding future events. In some cases, forward-looking information can be identified by such terms as “plans”, “anticipated”, “believe”, and “will”. 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, may prove to be incorrect. The risks and uncertainties that may affect forward-looking information include, but are not limited to, market conditions, the effect of the COVID-19 pandemic 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 in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC and applicable securities commissions or similar regulatory authorities in Canada on February 23, 2022, which is 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.

Important Additional Information Regarding Proxy Solicitation

DIRTT intends to file the Definitive Proxy Statement with the SEC in connection with the solicitation of proxies for the Meeting. DIRTT, its directors and certain of its executive officers will be participants in the solicitation of proxies from shareholders in respect of the Meeting. Information regarding the names of DIRTT’s directors and executive officers and their respective interests in DIRTT by security holdings or otherwise is set forth in DIRTT’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as filed with the SEC on February 23, 2022, and the Preliminary Proxy Statement, as filed with the SEC on February 25, 2022. To the extent holdings of such participants in DIRTT’s securities are not reported, or have changed since the amounts described, in the 2021 proxy statement, such changes have been reflected on Statements of Change in Ownership on Form 4 filed with the SEC. Details concerning the nominees of DIRTT’s Board for election at the Meeting will be included in the Definitive Proxy Statement and accompanying BLUE proxy card. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SHAREHOLDERS OF THE COMPANY ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH OR FURNISHED TO THE SEC, INCLUDING THE COMPANY’S DEFINITIVE PROXY STATEMENT, ACCOMPANYING BLUE PROXY CARD AND ANY SUPPLEMENTS THERETO WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and shareholders will be able to obtain a copy of the Definitive Proxy Statement and other relevant documents filed by DIRTT free of charge from the SEC’s website, www.sec.gov. DIRTT’s shareholders will also be able to obtain, without charge, a copy of the Definitive Proxy Statement and other relevant filed documents by directing a request by mail to DIRTT Environmental Solutions Ltd., 7303 30th Street S.E., Calgary, Alberta, Canada T2C 1N6 or at ir@dirtt.com or from the investor relations section of DIRTT’s website, ww.dirtt.com/investors.

About DIRTT

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”.

For further information please contact:

  • Kim MacEachern

    Investor Relations, DIRTT

    1-403-723-5000kmaceachern@dirtt.com

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