NEW YORK--(BUSINESS WIRE)-- 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 announced that Institutional Shareholder Services Inc. (“ISS”), a leading independent proxy advisory firm, has recommended that Dye & Durham shareholders support meaningful boardroom change by voting for three of its six directors at the Company’s 2024 Annual Meeting of Shareholders to be held on December 17, 2024. ISS recommends that shareholders vote the BLUE proxy card to elect Arnaud Ajdler, Hans T. Gieskes and Anthony Kinnear to the Board of Directors (the “Board”).

Notably, ISS recommends that shareholders WITHHOLD votes for CEO Matt Proud, Chair of the Compensation Committee Edward Prittie and director Luke McCormick.

Mr. Ajdler, Founder and Managing Partner of Engine, commented:

“We appreciate that ISS has highlighted the need for urgent Board and leadership changes at Dye & Durham. The firm’s recommendation for the addition of our proposed Chair and interim CEO Hans Gieskes and the removal of Matt Proud should send a clear signal to shareholders about the root of the boardroom dysfunction that has destroyed shareholder value and Dye & Durham’s culture. As ISS notes, the Board’s recent refreshments have not gone far enough to replace the directors responsible for the Company’s undisciplined capital allocation strategy and execution problems.

It is absolutely necessary that shareholders vote to elect all six of Engine’s highly qualified directors to ensure that the Board is best equipped to identity, attract and oversee the Company’s next leader on the path to delivering value for long-suffering shareholders. Our directors have the right backgrounds in legal technology, software operations, corporate governance, business transformation, CEO succession planning and capital allocation at top-performing organizations to fix Dye & Durham’s culture and improve performance for the benefit of all employees, customers and shareholders.”

In its full report, ISS affirmed Engine’s case for change and acknowledged concerns regarding the Board’s ability to attract and retain a new CEO, as well as the Board’s questionable tactics under Chair Colleen Moorehead:¹

• “Various configurations of the board have been ineffective at performing oversight over the company's founder, CEO, and strategic architect, Matthew Proud.”

• “Shareholders would be right to wonder […] if Proud and the management nominees endorsing his continued involvement in the succession process should be trusted.”

• “[…] there is unease regarding oversight and accountability, and the ability of the incumbent board (with Proud involved) to attract and retain a new high-caliber CEO.”

• “[Ms. Moorehead] has served during over a period where the company's leverage increased despite public commitments for leverage reduction.”

• “Prittie, being the longest tenured incumbent director alongside Proud, has overseen the entirety of Proud's actions while CEO and was also identified by the company's former chair Derksen as being ‘unengaged.’”

• “Considering underlying concerns about oversight and accountability, Prittie's continued presence on the board represents a risk of the problems of the past continuing, including an overly deferential posture towards Proud.”

• “At times, the board has engaged in questionable tactics to stifle the dissident campaign under [Ms. Moorehead’s] tenure, most notably by lobbying for the Competition Bureau investigation to serve as rationale to preserve the incumbent board and management.”

• “[McCormick] lacks the public company board experience or legal industry experience possessed by certain of the dissident nominees.”

ISS noted the following with respect to Engine’s director candidates and its CEO transition plan:

• “Dissident nominee Ajdler provides extensive public company board experience, and importantly, ensures a valuable shareholder perspective on the board during the critical CEO succession process.”

• “Dissident nominees Gieskes and Kinnear both possess public company board experience and relevant legal industry experience.”

• “Both [Gieskes and Kinnear] appeared credible during engagement in terms of their industry knowledge, and Gieskes also was proposed to serve as interim CEO, if necessary, during a potential transition.”

Shareholders are encouraged to vote FOR all six of Engine’s nominees using only the BLUE proxy card. In order for your votes to be counted, you must submit your BLUE proxy or voting instruction form before 10:30 a.m. Eastern Time on December 12, 2024.

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. 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. If you have questions or require assistance with voting your shares, please contact the proxy solicitation agent, Sodali & Co, at Toll Free: 1-888-777-2094, Outside North America (collect calls accepted): 1-289-695-3075 or Email: assistance@sodali.com.

For more information on how to vote for the entire Engine slate on the BLUE Proxy Card, to download a copy of the full presentation and to share feedback on Dye & Durham, visit www.LetsFixDND.com. Visit SEDAR+ (www.sedarplus.ca) to review a copy of Engine’s Information Proxy Circular, dated November 29, 2024.

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.

¹ Permission to use quotations from ISS was neither sought nor obtained.

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