UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of The Securities Exchange Act of 1934
(Amendment No. )
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Filed by a Party other than the Registrant ☒
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| ☐ | Preliminary Proxy Statement |
| ☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
| ☐ | Definitive Proxy Statement |
| ☐ | Definitive Additional Materials |
| ☒ | Soliciting Material Under Rule 14a-12 |
DIRTT ENVIRONMENTAL SOLUTIONS LTD. |
(Name of Registrant as Specified in Its Charter) |
22NW FUND, LP 22NW, LP 22NW FUND GP, LLC 22NW GP, INC. ARON R. ENGLISH RYAN W. BRODERICK BRYSON O. HIRAI-HADLEY ALEXANDER B. JONES CORY J. MITCHELL DOUGLAS A. EDWARDS SCOTT L. ROBINSON SCOTT C. RYAN KENNETH D. SANDERS |
(Name of Persons(s) Filing Proxy Statement, if Other Than the Registrant) |
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22NW Fund, LP, a Delaware limited partnership (“22NW Fund”), together with the other participants named herein (collectively, “22NW”), intends to file a preliminary proxy statement and accompanying WHITE proxy card with the Securities and Exchange Commission (“SEC”) to be used to solicit votes for the election of its slate of highly-qualified director nominees at the meeting of shareholders of DIRTT Environmental Solutions Ltd., an Alberta corporation (the “Company”) for which it has delivered a requisition to the Board of Directors of the Company pursuant to section 142 of the Business Corporations Act (Alberta).
On December 9, 2021, 22NW issued the following press release.
22NW Makes Proposal to DIRTT
SEATTLE, December 9, 2021 /CNW/ - 22NW Fund, LP (“22NW”) today provided an update on its requisition (the “Requisition”) for a meeting (the “Meeting”) of shareholders of DIRTT Environmental Solutions Ltd. (“DIRTT”) under the Business Corporations Act (Alberta) (the “ABCA”).
In the Requisition, which DIRTT received on November 17, 2021, 22NW requested that the Meeting be held no later than January 21, 2021. In response, DIRTT has called an annual and special meeting of DIRTT shareholders for April 26, 2022 (the “2022 AGM”), more than 5 MONTHS from the date of receiving the Requisition. Courts have described the right to requisition a shareholder meeting as “fundamental” in respect of corporate governance, saying the right “is only meaningful if it can be exercised in a timely and expeditious manner”. 22NW believes that DIRTT has not respected its fundamental right as a shareholder.
In its press release dated December 7, 2021, DIRTT states that “There is no new business or strategy being proposed” by 22NW, and 22NW “has not put forward any reason” as to why the Meeting should be held earlier than April 26, 2022.
These are not requirements of the ABCA related to the Requisition. They are simply standards created and imposed by DIRTT on the Requisition to the detriment of 22NW as a shareholder exercising a fundamental right under the ABCA.
Notwithstanding the manner in which DIRTT has treated the Requisition and 22NW, its largest shareholder, 22NW today announced that it is attempting a constructive settlement with DIRTT by means of submitting a term sheet for a settlement proposal (the “Proposal”) under which Todd Lillibridge, Denise Karkkainen and Steve Parry would retire from DIRTT’s board of directors (the “Board”) to be replaced by Aron English, Ken Sanders and Scott Robinson. Under the Proposal, 22NW would agree to support the director nominees of the Board at DIRTT’s 2022 AGM, which would remain at eight. It is a condition of the Proposal that it is accepted no later than December 15, 2021. If DIRTT accepts the Proposal, 22NW will withdraw the Requisition.
FOR MORE INFORMATION
For further information or to receive a copy of the report filed in connection with this press release, please see DIRTT’s profile on the SEDAR website (http://www.sedar.com) or contact Aron English at 206-227-3078 or info@englishcap.com.
CERTAIN INFORMATION CONCERNING THE PARTICIPANTS
22NW Fund, LP, a Delaware limited partnership (“22NW Fund”), together with the other participants named herein (collectively, “22NW”), intends to file a preliminary proxy statement and accompanying WHITE proxy card with the Securities and Exchange Commission (“SEC”) to be used to solicit votes for the election of its slate of highly-qualified director nominees at the meeting of shareholders of DIRTT Environmental Solutions Ltd., an Alberta corporation (the “Company”) for which it has delivered a requisition to the Board of Directors of the Company pursuant to section 142 of the Business Corporations Act (Alberta).
22NW STRONGLY ADVISES ALL SHAREHOLDERS OF THE COMPANY TO READ THE PROXY STATEMENT AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC'S WEB SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THIS PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY STATEMENT WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST.
The participants in the proxy solicitation are anticipated to be 22NW Fund, 22NW, LP, a Delaware limited partnership (“22NW LP”), 22NW Fund GP, LLC, a Delaware limited liability company (“22NW GP”), 22NW GP, Inc., a Delaware S Corporation (“22NW Inc.”), Aron R. English, Ryan W. Broderick, Bryson O. Hirai-Hadley, Alexander B. Jones, Cory J. Mitchell, Douglas A. Edwards, Scott L. Robinson, Scott C. Ryan and Kenneth D. Sanders.
As of the date hereof, 22NW Fund directly beneficially owns 15,894,165 Common Shares, without par value, of the Company (the “Shares”). As the investment manager of 22NW Fund, 22NW LP may be deemed to beneficially own the 15,894,165 Shares directly beneficially owned by 22NW Fund. As the general partner of 22NW Fund, 22NW GP may be deemed to beneficially own the 15,894,165 Shares directly beneficially owned by 22NW Fund. As the general partner of 22NW, LP, 22NW Inc. may be deemed to beneficially own the 15,894,165 Shares directly beneficially owned by 22NW Fund. As of the date hereof, Mr. English directly beneficially owns 214,869 Shares. Mr. English, as the Portfolio Manager of 22NW LP, Manager of 22NW GP, and President and sole shareholder of 22NW Inc, may be deemed to beneficially own the 15,894,165 Shares directly beneficially owned by 22NW Fund, which, together with the 214,869 Shares he directly owns, constitutes an aggregate of 16,109,034 Shares beneficially owned by Mr. English. As of the date hereof, Mr. Broderick directly beneficially owns 5,675 Shares. As of the date hereof, Mr. Hirai-Hadley directly beneficially owns 1,250 Shares. As of the date hereof, Mr. Jones directly beneficially owns 1,200 Shares. As of the date hereof, Mr. Mitchell directly beneficially owns 6,890 Shares. As of the date hereof, none of Messrs. Edwards, Robinson, Ryan and Sanders own beneficially or of record any securities of the Company.
