Plans to Recruit a World-Class CEO, Focus
Strategy Toward Organic Revenue Growth and Free Cash Flow
Generation, Pause M&A Until Net Leverage is 3x, Improve
Governance and Overhaul Compensation Practices
Provides a Credible, Achievable Path to
Tripling Dye & Durham’s Share Price in Less Than Three
Years
Calls on the Board to Disclose Details of Matt
Proud’s Severance Agreement and $10 Million Payment so Shareholders
Can Make an Informed Decision on the Future of Dye & Durham
Visit www.LetsFixDND.com to View the
Presentation and Learn How to Vote on the BLUE Proxy Card “FOR” ALL SIX of Engine’s Directors and
“WITHHOLD” on ALL of the
Incumbent Directors
Engine Capital LP (together with its affiliates, "Engine" or
"we"), which owns approximately 7.1% of the issued and outstanding
common shares of Dye & Durham Limited (TSX: DND) ("Dye &
Durham" or the "Company"), today released a presentation
highlighting the opportunity to meaningfully upgrade Dye &
Durham’s Board of Directors (the “Board”) by electing Engine’s six
director candidates, who possess relevant expertise in software,
legal technology, corporate turnarounds, capital allocation,
governance and succession planning. Engine also filed its
Information Circular and sent a letter to shareholders in
connection with the upcoming Annual Meeting of Shareholders (the
“Annual Meeting”) to be held on December 17, 2024.
The presentation contains the Engine slate’s plan to improve Dye
& Durham’s operating strategy and meaningfully improve value
for all shareholders by:
- Recruiting a World-Class CEO – Engine and its slate have
been working with a nationally recognized executive search firm for
nearly two months and are in communication with proven software CEO
candidates who possess strong operational track records.
Importantly, our nominees have experience running successful CEO
searches and will ensure an independent and comprehensive process
to appoint Dye & Durham’s next leader.
- Refocusing the Strategy – We will shift the Company’s
focus toward true organic growth (e.g., growth not solely driven by
M&A and pricing) by overhauling Dye & Durham’s go-to-market
strategy. We are targeting a 10% organic revenue growth rate and
60% adjusted EBITDA to free cash flow conversion by 2028.
- Enhancing Capital Allocation – We will pause M&A and
focus on debt reduction until net leverage is ~3x. We will also
conduct a comprehensive review of the Company’s asset portfolio to
establish core versus non-core businesses and evaluate whether
asset divestments could deliver value and accelerate the
deleveraging process.
- Rebuilding Trust with Stakeholders – We will foster an
enhanced culture focused on disciplined, IRR-driven decisions that
build long-term customer loyalty and shareholder value. We will
also establish a workplace environment of greater accountability
and respect.
- Overhauling Compensation Practices – We will establish
an executive compensation framework that aligns management’s
interests with shareholders, including by balancing retention and
performance-based payouts.
Additionally, Engine believes Dye & Durham’s Board must
immediately disclose the full details of CEO Matt Proud’s
separation agreement to ensure shareholders can make an informed
decision at the upcoming Annual Meeting. If not for media
reports, shareholders would not have known about the unnecessary
$10 million “ransom” payment to Mr. Proud. Shareholders deserve to
have all the facts ahead of this consequential vote, including
whether the severance arrangements affected the Company’s investor
rights agreement with Mr. Proud’s investment vehicle, Plantro Ltd.
Absent changes to that agreement, Mr. Proud could still seek to use
its provisions to install himself as Chair of the Board. It would
be extraordinary if the Board had created a situation where Mr.
Proud was able to pocket his $10 million payment and continue to
lead the Company as Chair, while interfering with the search for
the next CEO.
***
At the December 17th Annual Meeting, shareholders must decide
which set of directors they trust with (i.) identifying, attracting
and supervising Dye & Durham’s next leader, and (ii.)
implementing and overseeing the Company’s go-forward operating
strategy.
The only way to ensure the Board is best equipped to effectively
guide the Company and implement our superior value creation plan is
by voting FOR all six of
Engine’s highly qualified and independent director candidates –
Arnaud Ajdler, Hans T. Gieskes, Tracey E. Keates, Ritu Khanna,
Anthony P. Kinnear and Sid Singh. We also recommend shareholders
WITHHOLD support for all seven
of the Company’s nominees.
Visit www.LetsFixDND.com to view Engine’s presentation, obtain a
copy of Engine’s Information Circular and access related proxy
materials, including a BLUE
Proxy Card or voting instruction form.
***
Due to the ongoing Canada Post mail strike,
shareholders are urged not to wait for Engine’s proxy materials to
arrive in the mail. Instead, take action immediately:
- Contact your broker to obtain the 16-digit control number
associated with your BLUE
voting instruction form.
- Once you have your control number, visit
www.LetsFixDND.com/how-to-vote to cast your vote.
- Discard the management GOLD proxy. Engine urges you to vote
only using the BLUE proxy. If
you have already voted using the GOLD Dye & Durham proxy, you
can submit a new vote using the BLUE proxy. Only the later dated proxy will be
counted at the Annual Meeting.
- The deadline to vote is 10:30 a.m.
(Toronto time) on December 12, 2024.
***
Shareholders who have questions or require
assistance voting their BLUE
Proxy, please contact Sodali & Co at:
North American Toll-Free Number:
1-888-777-2094 Outside North America (collect calls
accepted): 1-289-695-3075 Email:
assistance@sodali.com
Shareholders should carefully review Engine’s information proxy
circular dated November 29, 2024, which is available on the
Company’s profile on SEDAR+ at www.sedarplus.ca.
Disclaimer for Forward-Looking
Information
Statements contained herein that are not historical facts
constitute “forward-looking statements” and “forward-looking
information” (together, “forward-looking statements”) within the
meaning of applicable securities laws that reflect Engine’s current
expectations, assumptions, and estimates of future events,
performance and economic conditions. Such forward-looking
statements rely on the safe harbor provisions of applicable
securities laws. Because such statements are subject to risks and
uncertainties, actual results may differ materially from those
expressed or implied by such forward-looking statements and there
can be no assurance that the Company’s securities will trade at the
prices that may be implied herein, and there can be no assurance
that any opinion or assumption herein is, or will be proven,
correct. Words and phrases such as “anticipate,” “believe,”
“create,” “drive,” “expect,” “forecast,” “future,” “growth,”
“intend,” “hope,” “opportunity,” “plan,” “confident,” “restore,”
“reduce,” “potential,” “proposal,” “unlock,” “upside,” “will,”
“would,” and similar words and phrases are intended to identify
forward-looking statements. These forward-looking statements may
include, but are not limited to, statements concerning: the
anticipated financial and operating performance of Dye &
Durham; anticipated changes to Dye & Durham’s debt levels and
financial ratios; the outcome of the Annual Meeting; the release of
a transition plan and go-forward strategy; anticipated EBITDA; and
achieving organic growth, free cash flow generation and leverage
reduction. Such forward-looking statements are not guarantees of
future performance or actual results, and readers should not place
undue reliance on any forward-looking statement as actual results
may differ materially and adversely from forward-looking
statements. All forward-looking statements contained herein are
made only as of the date hereof, and Engine disclaims any intention
or obligation to update or revise any such forward-looking
statements to reflect events or circumstances that subsequently
occur, or of which Engine hereafter becomes aware, except as
required by applicable law.
Non-IFRS Measures
This press release makes reference to certain non-IFRS financial
measures. These measures are not recognized measures under IFRS, do
not have a standardized meaning prescribed by IFRS and may not be
comparable to similar measures presented by other companies.
Rather, these measures are provided as additional information to
complement IFRS financial measures by providing further
understanding of the Company’s results of operations from the
Company’s perspective as disclosed by the Company in its public
disclosure, including in the Company’s Management Circular. The
Company’s definitions of non-IFRS measures may not be the same as
the definitions for such measures used by other companies or
investors in their reporting. Non-IFRS measures have limitations as
analytical tools and should not be considered in isolation nor as a
substitute for analysis of the Company’s financial information
reported under IFRS. The Company discloses that it uses non-IFRS
financial measures, including “EBITDA” and “Leveraged Free Cash
Flow”, to provide investors with supplemental measures of the
Company’s operating performance and to eliminate items that have
less bearing on operating performance or operating conditions and
thus highlight trends in the Company’s core business that may not
otherwise be apparent when relying solely on IFRS financial
measures. Engine believes that securities analysts, investors and
other interested parties frequently use non-IFRS financial measures
in the evaluation of issuers such as the Company. The Company also
discloses that it uses non-IFRS financial measures in order to
facilitate operating performance comparisons from period to period.
Please see “Cautionary Note Regarding Non-IFRS Measures” and
“Select Information and Reconciliation of Non-IFRS Measures” in the
Company’s most recent Management’s Discussion and Analysis, which
is available on the Company’s profile on SEDAR+ at
www.sedarplus.ca, for further details on these non-IFRS measures,
including (i) definitions of each non-IFRS measure and an
explanation of the composition of each non-IFRS financial measure,
and (ii) relevant reconciliations of each non-IFRS measure to its
most directly comparable IFRS measure, which information is
incorporated by reference herein. Engine believes that its
disclosure of non-IFRS measures in this press release is consistent
with the use of such measures by the Company.
About Engine Capital
Engine Capital LP is a value-oriented special situations fund
that invests both actively and passively in companies undergoing
change.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241203691374/en/
For Investors: Engine Capital LP 212-321-0048
info@enginecap.com
For Media: Longacre Square Partners Charlotte Kiaie /
Bela Kirpalani, 646-386-0091 engine-DND@longacresquare.com
Grafico Azioni Dye and Durham (TSX:DND)
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Da Nov 2024 a Dic 2024
Grafico Azioni Dye and Durham (TSX:DND)
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