Form 8-K - Current report

12/310001136174FALSE00011361742024-09-172024-09-17

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  September 17, 2024

Ontrak, Inc.

(Exact name of registrant as specified in its charter)

Delaware

001-31932

88-0464853

(State or other jurisdiction of incorporation)

(Commission File Number)

(IRS Employer Identification No.)

333 S. E. 2nd Avenue, Suite 2000, Miami, FL 33131

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code   [phone]

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):

☐   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common Stock, $0.0001 par value			OTRK			The NASDAQ Capital Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

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Item 3.03. Material Modification to Rights of Security Holders.

To the extent required by Item 3.03 of Form 8-K, the information in Item 5.03 of this report is incorporated herein by reference.

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

As previously reported in its Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on September 13, 2024, Ontrak, Inc. (“we,” “us,” “our” or the “Company”) held its annual meeting of stockholders on September 10, 2024 at which the Company’s stockholders approved the proposal to give the Company’s board of directors (the “Board”) the authority, at its discretion, to file a certificate of amendment to the Company’s certificate of incorporation to effect a reverse split of the Company’s issued common stock (the “Common Stock”), at a ratio not less than 1-for-2 and not greater than 1-for-15, without reducing the authorized number of shares of Common Stock, with the exact ratio to be selected by the Board in its discretion and to be effected, if at all, in the sole discretion of the Board at any time following stockholder approval of the proposal and before September 10, 2025 without further approval or authorization of the Company’s stockholders.

Subsequently, the Board determined to effect a reverse split of the Common Stock (the “Reverse Stock Split”) at a ratio of 1-for-15 (the “Reverse Stock Split Ratio”).

On September 17, 2024, the Company filed a certificate of amendment to the Company’s certificate of incorporation with the Secretary of State of the State of Delaware to effect the Reverse Stock Split (the “Charter Amendment”). The Reverse Stock Split will become effective at 12:01 a.m. Eastern Time on September 23, 2024, and the Common Stock is expected to begin trading on a split-adjusted basis at the opening of trading on The Nasdaq Capital Market on September 23, 2024. The Common Stock will continue to trade under its existing symbol “OTRK,” but the Common Stock has been assigned a new CUSIP number (683373 401).

When the Reverse Stock Split becomes effective, every 15 shares of Common Stock issued, including shares held by the Company in treasury, if any, will automatically be reclassified and combined into one share of Common Stock. No fractional shares will be issued as a result of the Reverse Stock Split. Stockholders who would otherwise be entitled to receive a fractional share will instead automatically have their fractional interests rounded up to the next whole share, after aggregating the fractional interests of a holder resulting from the Reverse Stock Split. The Reverse Stock Split will affect all stockholders uniformly and will not change any stockholder’s percentage ownership interest or any stockholder’s proportionate voting power, except for changes that may result from the treatment of fractional shares. The Reverse Stock Split will not change the number of authorized shares of Common Stock or the par value per share of the Common Stock.

The Reverse Stock Split will reduce the number of issued and outstanding shares of Common Stock from approximately 48.0 million to approximately 3.2 million.

In addition, as a result of the Reverse Stock Split, proportionate adjustments will made in accordance with the applicable terms of outstanding securities and the Company’s stock incentive plans to the (a) per share exercise prices of, and the number of shares underlying, the Company’s outstanding stock options, (b) number of shares available for the grant of awards under the Company’s stock incentive plans, and (c) per share exercise prices of, and the number of shares underlying, outstanding warrants to purchase shares of the Company’s common stock.

The foregoing description of the Charter Amendment does not purport to be complete and is qualified in its entirety by reference to the full text thereof, which is filed as an exhibit to this report and is incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

On September 19, 2024, the Company issued a press release announcing the Reverse Stock Split, a copy of which is furnished as an exhibit to this report.

The information in this Item 7.01, including Exhibit 99.1 to this report, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liability under that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). The information contained in this Item 7.01 and Exhibit 99.1 shall not be incorporated by reference into any filing under the Exchange Act or the Securities Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

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Item 8.01 Other Events.

The information in Item 5.03 of report is incorporated herein by reference.

The Company has registration statements on Form S-3 (File Nos. 333-121634, 333-123772, 333-128544, 333-128931, 333-140114, 333-140593, 333-140594, 333-145906, 333-147188, 333-153053, 333-158407, 333-230475, 333-248770, and 333-259329) and registration statements on Form S-8 (File Nos. 333-282112, 333-278847, 333-269341, 333-268928, 333-267316, 333-266467, 333-263942, 333-261976, 333-251965, 333-237566, 333-229717, 333-229117, 333-222276, 333-173662, 333-153054, 333-149766, 333-136446, and 333-123773) on file with the SEC (collectively, the “Registration Statements”). SEC regulations permit the Company to incorporate by reference future filings made with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the termination of the offerings covered by registration statements filed on Form S-3 and/or Form S-8. The information incorporated by reference is considered part of the prospectus included within each of those registration statements. Information in this Item 8.01 is intended to be automatically incorporated by reference into each of the active Registration Statements, thereby amending them. Pursuant to Rule 416(b) under the Securities Act of 1933, as amended, the amount of undistributed shares of Common Stock deemed covered by the Registration Statements are proportionately reduced as of the effective time of the Reverse Stock Split at the Reverse Stock Split Ratio.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.						Description
3.1						Certificate of Amendment of Certificate of Incorporation dated September 17, 2024
99.1						Press release issued on September 19, 2024
104						Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

						Ontrak, Inc.
Date: September 19, 2024						By:			/s/ James J. Park
									James J. Park
									Chief Financial Officer

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EXHIBIT 3.1

CERTIFICATE OF AMENDMENT
OF AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF ONTRAK, INC.

(Pursuant to Section 242 of the
General Corporation Law of the State of Delaware)

Ontrak, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware (the “DGCL”), hereby certifies as follows:

FIRST: This Certificate of Amendment (this “Certificate of Amendment”) amends the provisions of the Corporation’s Amended and Restated Certificate of Incorporation filed with the Secretary of State on October 28, 2019, as amended by the Certificate of Amendment thereto filed with the Secretary of State on July 6, 2020, the Certificate of Amendment thereto filed with the Secretary of State on February 21, 2023, the Certificate of Amendment thereto filed with the Secretary of State on July 27, 2023, and the Certificate of Designations of Rights and Preferences filed with the Secretary of State on August 21, 2020 and Amendment No. 1 to Certificate of Designations of Rights and Preferences filed with the Secretary of State on October 15, 2020 (as amended to date, the “Certificate of Incorporation”).

SECOND: The Certificate of Incorporation is hereby amended by deleting paragraph 3 of Article FOURTH thereof in its entirety and substituting in lieu thereof a new paragraph 3 of Article FOURTH, which shall read in its entirety as follows:

“3. Effective at 12:01 a.m. Eastern Time on September 23, 2024 (the “Effective Time”), every fifteen (15) shares of Common Stock issued and outstanding or held by the Corporation in treasury stock, in each case immediately prior to the Effective Time, shall automatically be combined and reclassified into one (1) validly issued, fully paid and non-assessable share of Common Stock without any further action by the Corporation or the holder thereof (the “Reverse Stock Split”); provided, however, that no fractional shares of Common Stock shall be issued as a result of the Reverse Stock Split. In lieu thereof, any holder of Common Stock who would otherwise be entitled to a fractional share of Common Stock created as a result of the Reverse Stock Split (after taking into account all fractional share interests of the holder resulting from the Reverse Stock Split) shall be entitled to receive one (1) whole share of Common Stock. Any stock certificate that, immediately prior to the Effective Time, represented shares of Common Stock (an “Old Certificate”) shall thereafter, automatically and without the necessity of presenting the same for exchange, represent that number of shares of Common Stock into which the shares of Common Stock represented by the Old Certificate shall have been combined and reclassified, subject to the treatment of fractional share interests described above; provided, however, that each holder of record holding an Old Certificate shall receive, upon surrender of such certificate, a new certificate evidencing and representing the number of shares of Common Stock after the Effective Time into which the shares of Common Stock formerly represented by the Old Certificate shall have been combined and reclassified, subject to the treatment of fractional share interests described above. The Reverse Stock Split shall have no effect on the number of authorized shares designated as Common Stock, the number of authorized shares designated as Preferred Stock or the respective par values per share thereof, in each case as set forth in paragraph 1 of this Article Fourth.”

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THIRD: The amendment to the Certificate of Incorporation set forth in this Certificate of Amendment was duly adopted in accordance with the provisions of Section 242 of the DGCL.

FOURTH: All other provisions of the Certificate of Incorporation shall remain in full force and effect.

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Amendment to be executed by its duly authorized officer on this 17th day of September, 2024.

Ontrak, Inc.

By:     /s/ Brandon H. LaVerne            
Name: Brandon H. LaVerne
Title: Chief Executive Officer

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EXHIBIT 99.1

Ontrak, Inc. Announces Reverse Stock Split

Shares Expected to Begin Trading on Split-Adjusted Basis on September 23, 2024

Ontrak, Inc. (NASDAQ: OTRK), a leading AI-powered and technology-enabled behavioral healthcare company, today announced that it will implement a 1-for-15 reverse split of the issued shares of its common stock, effective at 12:01 a.m. Eastern Time on September 23, 2024. The Company's common stock is expected to begin trading on a split-adjusted basis when the market opens on September 23, 2024, and will continue to trade on The Nasdaq Capital Market under the symbol “OTRK.” The new CUSIP number for the common stock will be 683373 401.

The reverse stock split is intended to increase the bid price of the common stock to enable the Company to regain compliance with the $1.00 minimum bid price requirement for continued listing on The Nasdaq Capital Market. The Company’s stockholders authorized the reverse stock split at the Company’s annual meeting of stockholders held on September 10, 2024.

When the reverse stock split becomes effective, every 15 shares of the Company’s common stock issued and outstanding or held by the Company in treasury will automatically be combined and reclassified into one share of common stock. No fractional shares will be issued as a result of the reverse stock split. Stockholders who would otherwise be entitled to receive a fractional share will instead automatically have their fractional interests rounded up to the next whole share, after aggregating all the fractional interests of a holder resulting from the reverse stock split. The reverse stock split will affect all stockholders uniformly and will not change any stockholder’s percentage ownership interest or any stockholder’s proportionate voting power, except for immaterial changes that may result from the treatment of fractional shares. The reverse stock split will not change the number of authorized shares of the Company’s common stock or the par value per share of the Company’s common stock.

The reverse stock split will reduce the number of issued and outstanding shares of the Company’s common stock from approximately 48.0 million to approximately 3.2 million.

As a result of the reverse stock split, proportionate adjustments will be made to the per share exercise prices of, and the number of shares underlying, the Company’s outstanding stock options, as well as to the number of shares available for future awards granted under the Company’s stock incentive plans. In addition, proportionate adjustments will be made to the per share exercise prices of, and the number of shares underlying, outstanding warrants to purchase shares of the Company’s common stock.

The combination of, and reduction in, the issued shares of common stock as a result of the reverse stock split will occur automatically at the effective time of the reverse stock split without any additional action on the part of the Company’s stockholders. The Company's transfer agent, Equiniti Trust Company, LLC, is acting as the exchange agent for the reverse stock split and will send stockholders of record holding their shares electronically in book-entry form a transaction notice indicating the number of shares of common stock held after the reverse stock split. Stockholders who hold their shares through a broker, bank, or other nominee will have their positions adjusted to reflect the reverse stock split, subject to their broker, bank, or other nominee’s particular processes, and are not expected to be required to take any action in connection with the reverse stock split.

Additional information regarding the reverse stock split can be found in the Company’s definitive proxy statement for the annual meeting of stockholders of the Company held on September 10, 2024, which was filed with the U.S. Securities and Exchange Commission on July 29, 2024, a copy of which is available at www.sec.gov and on the Company's website.

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About Ontrak

Ontrak, Inc. (Nasdaq: OTRK) is a leading AI and technology-enabled behavioral healthcare company whose mission is to help improve health and save the lives of as many people as possible. Ontrak identifies, engages, activates, and provides care pathways to treatment for the most vulnerable members of the behavioral health population who would otherwise fall through the cracks of the healthcare system. We engage individuals with anxiety, depression, substance use disorder, and chronic disease through personalized care coaching and customized care pathways that help them receive the treatment and advocacy they need, despite the socioeconomic, medical, and health system barriers that exacerbate the severity of their comorbid illnesses. The company's integrated intervention platform uses AI, predictive analytics, and digital interfaces combined with dozens of care coach engagements to deliver improved member health, better healthcare system utilization, and durable outcomes and savings to healthcare payors.

Forward-Looking Statements

The Company cautions you that all statements, other than statements of historical facts, contained in this press release, are forward-looking statements. Forward-looking statements, in some cases, can be identified by terms such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “design,” “intend,” “expect,” “could,” “plan,” “potential,” “predict,” “seek,” “should,” “would,” “contemplate,” “project,” “target,” “objective,” or the negative version of these words and similar expressions. In this press release, forward-looking statements include, but are not limited to, statements relating to the timing, completion and effect of the reverse stock split and the Company’s ability to regain compliance with Nasdaq’s minimum bid price requirement and continue to have its common stock listed on The Nasdaq Capital Market. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements in this press release, including, without limitation, the risk that Nasdaq may not process the reverse stock split on the expected timeline; the risk that after the reverse stock split the closing bid price of the Company’s common stock is not at least $1.00 per share for a minimum of ten consecutive trading sessions; the potential for Nasdaq to suspend trading in or to delist the Company’s common stock. Forward-looking statements are based upon the Company’s current expectations and involve assumptions that may never materialize or may prove to be incorrect. All forward-looking statements are expressly qualified in their entirety by these cautionary statements. For a detailed description of risks and uncertainties the Company faces, you are encouraged to review the documents the Company files with the SEC including the Company’s recent filings on Form 8-K, Form 10-K and Form 10-Q. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they were made. The Company undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.

Company Contact:

Brandon LaVerne

Chief Executive Officer

[e-mail]

Investor Relations:

Ryan Halsted

Gilmartin Group

[e-mail]

Cover	Sep. 17, 2024
Cover [Abstract]
Document Type	8-K
Document Period End Date	Sep. 17, 2024
Entity Registrant Name	Ontrak, Inc.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-31932
Entity Tax Identification Number	88-0464853
Entity Address, Address Line One	333 S. E. 2nd Avenue
Entity Address, Address Line Two	Suite 2000
Entity Address, City or Town	Miami
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33131
City Area Code	310
Local Phone Number	444-4300
Title of 12(b) Security	Common Stock, $0.0001 par value
Trading Symbol	OTRK
Security Exchange Name	NASDAQ
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Entity Central Index Key	0001136174
Amendment Flag	false
Current Fiscal Year End Date	--12-31

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