22NW Fund Files 11th Amendment to DIRTT 13D

TL;DR

**Activist investor 22NW Fund just updated its DIRTT stake, watch for potential strategy shifts!**

AI Summary

22NW Fund, LP filed Amendment No. 11 to its Schedule 13D for DIRTT Environmental Solutions Ltd. on January 23, 2024, indicating a change in their beneficial ownership. This amendment was triggered by an event on January 9, 2024, and updates previous disclosures. This matters to investors because 22NW Fund, LP is a significant activist investor in DIRTT, and changes in their holdings or intentions can signal shifts in their strategy or outlook for the company, potentially influencing stock performance.

Why It Matters

This filing signals an update in the activist investor 22NW Fund's position or intentions regarding DIRTT Environmental Solutions, which could impact future corporate actions or stock valuation.

Risk Assessment

Risk Level: medium — Changes in activist investor positions can introduce volatility and uncertainty, depending on the nature of their updated intentions.

Analyst Insight

Investors should monitor subsequent filings from 22NW Fund, LP for DIRTT Environmental Solutions Ltd. to understand the specific changes in their ownership percentage or stated intentions, as this amendment only signals an update, not the details of the change itself.

Key Players & Entities

• 22NW Fund, LP (company) — the filing person and activist investor
• DIRTT Environmental Solutions Ltd. (company) — the subject company (issuer)
• ARON R. ENGLISH (person) — contact person for 22NW, LP
• RYAN NEBEL (person) — contact person for legal counsel Olshan Frome Wolosky LLP
• January 9, 2024 (date) — date of the event requiring this filing
• January 23, 2024 (date) — date the filing was made

FAQ

Key Financial Figures

• $44,335,026 — gregate purchase price of approximately $44,335,026, excluding brokerage commissions, (ii)
• $0.40 — reholder approval, at a deemed price of $0.40 per Share as reimbursement for legal fe
• $30.0 million — iption rights under the Issuer’s C$30.0 million rights offering (the “Rights Offe
• $0.35 — ing”) at a subscription price of C$0.35 per Share, and (iv) 8,440,252 of such S
• $17,262,885 — regate purchase price of approximately C$17,262,885. Of the 7,470,167 Shares directly owne
• $994,199 — gregate purchase price of approximately $994,199, excluding brokerage commissions, and (
• $1,763 — gregate purchase price of approximately $1,763, excluding brokerage commissions, and (
• $2,780 — gregate purchase price of approximately $2,780, excluding brokerage commissions, and (

Filing Documents

• sc13da1110680012_01232024.htm (SC 13D/A) — 205KB
• 0000921895-24-000110.txt ( ) — 207KB

Source and Amount of Funds or Other Consideration

Item 3. Source and Amount of Funds or Other Consideration .

is hereby amended

Item 3 is hereby amended and restated to read as follows: Of the 58,395,297 Shares beneficially owned by 22NW Fund, (i) 21,981,043 of such Shares were purchased with working capital (which may, at any given time, include margin loans made by brokerage firms in the ordinary course of business) and have an aggregate purchase price of approximately $44,335,026, excluding brokerage commissions, (ii) 3,899,745 of such Shares were granted by the Issuer, following shareholder approval, at a deemed price of $0.40 per Share as reimbursement for legal fees and other expenses incurred by 22NW Fund in connection with the contested director election at the Issuer’s 2022 annual and special meeting, (iii) 24,074,257 1 of such Shares were purchased pursuant to the exercise of 22NW Fund’s subscription rights under the Issuer’s C$30.0 million rights offering (the “Rights Offering”) at a subscription price of C$0.35 per Share, and (iv) 8,440,252 of such Shares are currently issuable upon the conversion of certain of the Issuer’s outstanding 6.00% convertible unsecured subordinated debentures (the “January 2026 Convertible Debentures”) and 6.25% convertible unsecured subordinated debentures (the “December 2026 Convertible Debentures,” and, together with the January 2026 Convertible Debentures, the “Convertible Debentures”), which Convertible Debentures have an aggregate purchase price of approximately C$17,262,885. Of the 7,470,167 Shares directly owned by Mr. English, (i) 1,777,369 were purchased with personal funds (which may, at any given time, include margin loans made by brokerage firms in the ordinary course of business) and have an aggregate purchase price of approximately $994,199, excluding brokerage commissions, and (ii) 5,692,798 2 of such Shares were purchased pursuant to the exercise of Mr. English’s subscription rights under the Rights Offering at a subscription price of C$0.35 per Share. Of

Interest in Securities of the Issuer

Item 5. Interest in Securities of the Issuer . Items 5(a) and (c) are hereby amended and restated as follows: (a) The aggregate percentage of Shares reported owned by each person named herein is based upon 191,091,952 Shares outstanding as of January 9, 2024, which is the total number of Shares outstanding as reported in the Issuer’s Current Report on Form 8-K announcing the results of the Rights Offering and filed with the Securities and Exchange Commission on January 9, 2024, plus the number of Shares underlying the Convertible Debentures as reported herein, as applicable. 1 Inclusive of the internal transfer of 4,117,741 Shares from 22NW Fund to Mr. English, as further described in Item 5. 2 Inclusive of the internal transfer of 4,117,741 Shares from 22NW Fund to Mr. English, as further described in Item 5. 9 CUSIP No. 25490H106 As of the date hereof, 22NW Fund directly beneficially owned 58,395,297 Shares, constituting approximately 29.3% of the Shares outstanding, including 8,440,252 Shares issuable upon conversion of the Convertible Debentures owned by 22NW Fund. As of the date hereof, Mr. English directly beneficially owned 7,470,167 Shares, constituting approximately 3.9% of the Shares outstanding. As of the date hereof, Mr. Hirai-Hadley directly beneficially owned 2,272 Shares, constituting less than 1% of the Shares outstanding. As of the date hereof, Mr. Jones directly beneficially owned 2,181 Shares, constituting less than 1% of the Shares outstanding. 22NW, as the investment manager of 22NW Fund, may be deemed to beneficially own the 58,395,297 Shares beneficially owned by 22NW Fund, constituting approximately 29.3% of the Shares outstanding. 22NW GP, as the general partner of 22NW Fund, may be deemed to beneficially own the 58,395,297 Shares beneficially owned by 22NW Fund, constituting approximately 29.3% of the Shares outstanding. 22NW Inc., as the general partner of 22NW, may be deemed to beneficially own the 58,395,297 Shares ben

SIGNATURES

SIGNATURES After reasonable inquiry and to the best of his knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: January 23, 2024 22NW FUND, LP By: 22NW Fund GP, LLC General Partner By: /s/ Aron R. English Name: Aron R. English Title: Manager 22NW, LP By: 22NW GP, Inc. General Partner By: /s/ Aron R. English Name: Aron R. English Title: President and Sole Shareholder 22NW FUND GP, LLC By: /s/ Aron R. English Name: Aron R. English Title: Manager 22NW GP, INC. By: /s/ Aron R. English Name: Aron R. English Title: President and Sole Shareholder /s/ Aron R. English ARON R. ENGLISH Individually and as attorney-in-fact for Bryson O. Hirai-Hadley and Alexander B. Jones 12

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