Engine Capital’s Slate of Director Candidates Issues Letter to Dye & Durham Employees Regarding the Path to a Better Future

NEW YORK--(BUSINESS WIRE)--Dec 4, 2024--

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 issued an open letter to Dye & Durham employees from its slate of directors expressing their enthusiasm for bringing stability to the Company and improving the culture for the benefit of all its stakeholders.

Engine is seeking to elect six highly qualified and independent candidates to Dye & Durham’s seven-member Board of Directors (the “Board”) at the 2024 Annual Meeting of Shareholders to be held on December 17, 2024. While the Board seems intent on issuing slanderous and misleading communications regarding Engine’s intentions, we prefer to focus on the merits of ourvalue creation plan, the wide-ranging experience of our director candidates and the superior path forward for Dye & Durham.

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Dear Dye & Durham Employees,

First, we would like to thank each of you for your service to Dye & Durham. Over the last several months, we have had the opportunity to speak with current and former employees and have been impressed with your breadth of knowledge and belief in Dye & Durham’s potential. We have also heard directly from you about your significant concerns with the Company’s high turnover and unsatisfactory work environment. We are troubled by the deluge of negative employee ratings we have seen online, including reports of “archaic” leadership practices, a “toxic” culture, the Company’s constantly changing strategic direction and its disregard for employee wellbeing from the very top. 1

Engine has invested significant capital in Dye & Durham and today owns 7.1% of the Company’s shares, making it one of the Company’s largest shareholders. Engine nominated us as director candidates based on its belief that Dye & Durham is an incredibly valuable business that is currently being mismanaged by outgoing CEO Matt Proud. We want to change the culture at Dye & Durham for the better. We hope you will not be misled by the Company’s falsehoods that we are planning layoffs at Dye & Durham, particularly among the senior executive team. This is simply not the case. Our issues lie not with you, but solely with the leadership of the current Board, which has recently resorted to low-blow attacks against Engine. 2 We have overseen many business turnarounds and successful CEO transitions, so we know the retention of institutional knowledge throughout the organization is essential – especially during a CEO transition period.

Since we haven’t had the opportunity to meet each of you yet, we encourage you to visit www.LetsFixDND.com/Director-Candidates to read more about our backgrounds and get in touch if you’re interested in speaking directly. We are senior executives from some of the most successful software and fintech companies in Canada and the U.S., so we understand what it takes to establish a winning culture and deliver strong performance. We have backgrounds in legal technology, software operations, corporate governance, business transformation, CEO succession planning and capital allocation. Drawing on our experience from organizations like Constellation Software, Shopify, Thomson Reuters, LexisNexis, Equifax and Global Payments, we are excited to bring financial discipline, next-level customer insights, a clear understanding of the customer experience and track records of successful product integration to Dye & Durham.

In terms of what we plan to deliver if elected: recruit a world-class CEO who values transparency and ensures you have the business performance information you need to do your jobs well. We are focused on promoting a culture that prizes a winning strategy, employee welfare, superior products and stellar customer service. If we are elected, our goal will be to regain your trust and confidence. We will retain Dye & Durham’s highly skilled employees and ensure you are compensated such that when the Company succeeds, you too will reap the rewards.

For these reasons, we believe employees, customers and shareholders will all benefit from having our perspectives in the boardroom. Please know that if you own Dye & Durham stock, your vote in the upcoming election is extremely important and completely confidential. This means you can vote for whoever you believe is best suited to lead the Company, without fear of retaliation from current leadership.

We thank you for your commitment to Dye & Durham and look forward to working alongside you. We will continue to advocate for your interests and keep you apprised of our efforts.

You can visit www.LetsFixDND.com to learn how to vote for our full slate on the BLUE proxy card. You can also contact our proxy solicitor by calling 1-888-777-2094 or emailing assistance@sodali.com. Your conversations will be kept completely confidential.

Sincerely,

The Engine Capital Slate

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Additional information is available in Engine’s recently filed Information Circular and presentation, both of which can be found on SEDAR+ under Dye & Durham’s profile at www.sedarplus.ca and on the website, www.LetsFixDND.com.

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.

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1 Publicly available reviews on Glassdoor.
2 Dye & Durham falsely claimed in its December 4 press release that Arnaud Ajdler “was boasting about walking multiple executives out of the building the day after he won.” Mr. Ajdler has never said this and is disappointed the Company is resorting to spreading falsehoods about Engine and its director candidates.

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CONTACT: For Investors:

Engine Capital LP

212-321-0048

info@enginecap.comSodali & Co.

North American Toll-Free Number: 1-888-777-2094

Outside North America (collect calls accepted): 1-289-695-3075

assistance@sodali.comFor Media:

Longacre Square Partners

Charlotte Kiaie / Bela Kirpalani, 646-386-0091

engine-DND@longacresquare.com

KEYWORD: UNITED STATES NORTH AMERICA NEW YORK

INDUSTRY KEYWORD: PROFESSIONAL SERVICES FINANCE

SOURCE: Engine Capital LP

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