Form 4: DIRTT Environmental Solutions Director Acquires Over 32,000 Deferred Share Units

DIRTT Environmental Solutions Ltd. Director Scott C. Ryan acquired 32,835 Deferred Share Units (DSUs) on June 30, 2025, increasing his beneficial ownership to 919,730 DSUs.

Summary

• Director Scott C. Ryan of DIRTT Environmental Solutions Ltd. (DRTTF) acquired 32,835 Deferred Share Units (DSUs).
• The transaction occurred on June 30, 2025.
• Following this acquisition, Ryan beneficially owns a total of 919,730 DSUs.
• Each DSU is the economic equivalent of one common share of DIRTT Environmental Solutions Ltd.
• DSUs settle following the cessation of service and employment with the Issuer. For US Directors, settlement occurs no later than 40 days following the termination date, either in common shares or the cash equivalent based on the closing price of common shares the day prior to the 30th day following separation.
• The price used to calculate the number of DSUs granted was C$0.82, which was the closing price on the Toronto Stock Exchange on June 27, 2025.
• This Canadian dollar price was converted to US$0.6 per DSU using the Bank of Canada exchange rate of C$1.3676 = US$1.00 on June 27, 2025.

Sentiment

Score: 7

Explanation: The acquisition of additional equity by a director is generally a positive signal, indicating confidence in the company's future. However, it's a routine compensation-related transaction rather than a significant strategic move.

Positives

• Director Scott C. Ryan increased his beneficial ownership in the company by acquiring 32,835 Deferred Share Units, indicating continued alignment with shareholder interests.
• The acquisition of DSUs, which are tied to the company's common shares, suggests management's confidence in the future performance of DIRTT Environmental Solutions Ltd.

Risks

• The value of Deferred Share Units (DSUs) is directly tied to the performance of DIRTT Environmental Solutions Ltd.'s common shares, meaning their value can fluctuate with market conditions.

Future Outlook

The acquisition of Deferred Share Units by a director, which vest upon cessation of service, aligns the director's long-term interests with the company's future performance and shareholder value.

Management Comments

• The Deferred Share Units (DSUs) are granted pursuant to the DIRTT Environmental Solutions Ltd. Third Amended and Restated Long Term Incentive Plan.
• Each DSU is the economic equivalent of one common share and settles following the cessation of service and employment with the Issuer.

Industry Context

This Form 4 filing reflects a standard practice of executive compensation through equity-based incentives, common across various industries, including environmental solutions and construction technology, to align management interests with long-term company performance.

Comparison to Industry Standards

• The use of Deferred Share Units (DSUs) as a component of director compensation is a common practice in publicly traded companies, aligning director incentives with long-term shareholder value, similar to practices observed in companies like Steelcase Inc. (SCS) or Knoll, Inc. (KNL) within the commercial interiors and modular construction sectors.
• The grant size of 32,835 DSUs for a director should be evaluated in the context of the company's overall compensation philosophy and market capitalization, though specific comparable grants would require detailed compensation disclosures from peer companies.

Stakeholder Impact

• Shareholders: The acquisition of DSUs by a director aligns their interests with shareholders, potentially fostering long-term value creation.

Next Steps

• Continued monitoring of future insider transactions by Scott C. Ryan and other DIRTT Environmental Solutions Ltd. insiders.
• Review of DIRTT Environmental Solutions Ltd.'s upcoming financial reports for performance updates that may impact the value of these DSUs.

Key Dates

Keywords

DIRTT Environmental Solutions, DRTTF, SEC Form 4, Insider Trading, Deferred Share Units, DSU, Director Compensation, Equity Acquisition, Share Ownership, Corporate Governance