CATS Catasys Inc

Issuer:

Ontrak, Inc.

Securities:

9.50% Series A Cumulative Perpetual Preferred Stock (the “Series A Preferred Stock”)

Number of Shares:

1,730,000 shares of Series A Preferred Stock

Option to Purchase Additional Shares:

Up to 259,500 Shares

Trade Date:

December 16, 2020

Settlement Date:

December 18, 2020

Listing:

NASDAQ “OTRKP”

Offering size:

$42,817,500

Overallotment Option:

Up to $6,422,625

Maturity Date:

Perpetual (unless redeemed by Issuer on or after August 25, 2025 or in connection with a change of control or delisting event).

Rating:

The Series A Preferred Stock is not rated.

Dividend Rate (Cumulative):

We will pay cumulative cash dividends on the Series A Preferred Stock, when and as declared by our Board of Directors, at the rate of 9.50% of the $25.00 liquidation preference per year (equivalent to $2.375 per share).

Dividend Payment Dates:

Dividends will be payable quarterly in arrears, every February 28, May 30, August 31, and November 30; provided that if any dividend payment date is not a business day, then the dividend which would otherwise have been payable on that dividend payment date may be paid on the next succeeding business day, and no interest, additional dividends or other sums will accumulate. Dividends will accumulate and be cumulative from, and including, the date of original issuance.

Price to the Public:

$24.75

Day Count:

30/360

Liquidation Preference:

The liquidation preference of each share of Series A Preferred Stock is $25.00. Upon liquidation, Series A Preferred Stock shareholders will be entitled to receive the liquidation preference with respect to their shares of Series A Preferred Stock plus an amount equal to accumulated but unpaid dividends with respect to such shares.

Optional Redemption:

Series A Preferred Stock is redeemable by the Issuer on or after August 25, 2025. On or after August 25, 2025, the Issuer may redeem the Series A Preferred Stock, in whole or from time to time in part, for cash at a redemption price equivalent to $25.00 per share, plus accumulated and unpaid dividends to, but not including, the redemption date.

Special Optional Redemption Upon a Change of Control or Delisting Event:

Special optional redemption by the Company upon a change of control or delisting event, in whole or in part, for $25.00 per share, plus accrued but unpaid dividends, to, but not including, the redemption date (the “Redemption Right”). The circumstances that will constitute a “change of control” and a “delisting event” are set forth in the documents governing the Series A Preferred Stock.

Special Exchange Right Upon a Change of Control or Delisting Event:

Upon the occurrence of a change of control or delisting event, in the event the Company does not exercise the Redemption Right, holders of the Series A Preferred Stock will have the right to exchange some or all of the Series A Preferred Stock held by such holder into a number of common shares at a predetermined ratio.

DRD/QDI Eligible:

Yes

Minimum Denomination / Multiples:

$25.00/$25.00

CUSIP/ISIN:

683373 203/US6833732034

Book-Running Managers:

B. Riley Securities, Ladenburg Thalmann and William Blair

Co-Managers:

Aegis Capital Corp., The Benchmark Company, Incapital, Kingswood Capital Markets, division of Benchmark Investments, Inc.