Company to use non-dilutive capital for
working capital, M&A, investment in technology
Ontrak, Inc. (NASDAQ: OTRK, OTRKP) (“Ontrak” or
the “Company”), a leading AI-powered and telehealth enabled,
virtualized healthcare company, today announced that it has closed
its previously announced underwritten public offering of 1,730,000
shares of its 9.50% Series A Cumulative Perpetual Preferred Stock
(the “Series A Preferred Stock“) at $24.75 per share, for gross
proceeds to the Company of $42.8 million. The Company has granted
the underwriters a 30-day option to purchase up to an additional
259,500 shares of Series A Preferred Stock. The Series A Preferred
is listed on the Nasdaq Global Market under the symbol “OTRKP.”
After deducting underwriting fees and other offering expenses
payable by the Company, the net proceeds to the Company were
approximately $39.7 million prior to any exercise of the
underwriters’ option to purchase additional shares.
Mr. Terren Peizer, Chairman and CEO of Ontrak, stated: “Like our
August preferred stock offering, this financing was very well
received by the capital markets and has greatly enhanced
shareholder value. We now have in excess of $100 million in cash on
hand to execute on the strategic initiatives that we believe will
further accelerate our growth trajectory and commercial expansion.
This month Ontrak was ranked the fastest growing healthcare company
of its size and number 279 on Deloitte’s Technology Fast 500™, a
ranking of the 500 fastest-growing technology, media,
telecommunications, life sciences and energy tech companies in
North America. As the leading behavioral health company targeting
and successfully engaging the care avoidant 5.7% of the population
that Milliman found represented 44% of total medical expenditure
before the pandemic, we believe that Ontrak is uniquely well
positioned and very well capitalized to continue to be one of the
fastest growing technology and healthcare companies.”
The Company intends to use the net proceeds of this offering to
fund a segregated dividend account for the payment of dividends on
the Series A Preferred Stock through August 2022 and to use the
remaining net proceeds for general corporate purposes, which may
include working capital, M&A, and investments in
technology.
B. Riley Securities, Ladenburg Thalmann and William Blair acted
as book-running managers for the offering. Aegis Capital Corp., The
Benchmark Company, Incapital and Kingswood Capital Markets,
division of Benchmark Investments, Inc. acted as co-managers.
The offering of the Series A Preferred Stock was made under the
Company’s existing effective shelf registration statement (File No.
333-248770), which was filed with the Securities and Exchange
Commission (“SEC”). The offering was made by means of a prospectus
supplement and prospectus, which have been filed with the SEC. You
should read the applicable prospectus supplement and prospectus for
more complete information about the Company and the offering. You
may obtain these documents free of charge by visiting the SEC
website at www.sec.gov. Alternatively, you may obtain copies by
contacting B. Riley Securities, Inc. at 299 Park Avenue, New York,
New York 10171, by telephone at (703) 312-9580 or by email at
prospectuses@brileyfin.com.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of any securities in any state or jurisdiction in which
such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
state or jurisdiction.
About Ontrak, Inc.
Ontrak, Inc. (f/k/a Catasys, Inc.) is a leading AI-powered and
telehealth-enabled, virtualized healthcare company, whose mission
is to help improve the health and save the lives of as many people
as possible. The company’s PRE™ (Predict-Recommend-Engage) platform
predicts people whose chronic disease will improve with behavior
change, recommends effective care pathways that people are willing
to follow, and engages people who aren’t getting the care they
need. By combining predictive analytics with human engagement,
Ontrak delivers improved member health and validated outcomes and
savings to healthcare payers.
The company’s integrated, technology-enabled Ontrak™ solutions,
a critical component of the PRE platform, are designed to provide
healthcare solutions to members with behavioral conditions that
cause or exacerbate chronic medical conditions such as diabetes,
hypertension, coronary artery disease, COPD, and congestive heart
failure, which result in high medical costs.
Ontrak has a unique ability to engage these members, who do not
otherwise seek behavioral healthcare, leveraging proprietary
enrollment capabilities built on deep insights into the drivers of
care avoidance.
Ontrak integrates evidence-based psychosocial and medical
interventions delivered either in-person or via telehealth, along
with care coaching and in-market Community Care Coordinators who
address the social and environmental determinants of health,
including loneliness. The company’s programs improve member health
and deliver validated cost savings to healthcare payers of more
than 50 percent for enrolled members. Ontrak solutions are
available to members of leading national and regional health plans
in 30 states and in Washington, D.C.
Learn more at www.ontrak-inc.com
Forward-Looking Statements
Except for statements of historical fact, the matters discussed
in this press release are forward-looking and made pursuant to the
Safe Harbor provisions of the Private Securities Litigation Reform
Act of 1995. These forward-looking statements reflect numerous
assumptions and involve a variety of risks and uncertainties, many
of which are beyond our control, which may cause actual results to
differ materially from stated expectations. These risk factors
include, among others, the impact of the ongoing COVID 19 pandemic;
limited operating history; our inability to execute our business
plan; increase our revenue and achieve profitability; lower than
anticipated eligible members under our contracts; our inability to
recognize revenue; lack of outcomes and statistically significant
formal research studies; difficulty enrolling new members and
maintaining existing members in our programs; the risk that
treatment programs might not be effective; dependence on revenues
from our four largest customers, any or all of which may terminate
our services at any time; our dependence on third-party payors to
provide coverage and adequate payment rates for our programs;
difficulty in developing, exploiting and protecting proprietary
technologies; intense competition and substantial regulation in the
health care industry; changes in regulations or issuance of new
regulations or interpretations and the impact of healthcare reform
legislation; our dependence on the retention of key personnel; our
history of operating losses since our inception and significant
leverage; our ability to raise additional capital when needed, our
liquidity, and the risks associated with the adequacy of our
existing cash resources and our ability to continue as a going
concern. Forward looking statements may include statements
regarding our expectations regarding acceleration of our growth
trajectory and commercial expansion and our belief regarding our
position and capitalization to allow us to continue to be one of
the fastest growing technology and healthcare companies. You are
urged to consider statements that include the words "may," "will,"
"would," "could," "should," "believes," "estimates," "projects,"
"potential," "expects," "plan," "anticipates," "intends,"
"continues," "forecast," "designed," "goal," or the negative of
those words or other comparable words to be uncertain and
forward-looking. For a further list and description of the risks
and uncertainties we face, please refer to our most recent
Securities and Exchange Commission filings which are available on
its website at http://www.sec.gov. Such forward-looking statements
are current only as of the date they are made, and we assume no
obligation to update any forward-looking statements, whether as a
result of new information, future events or otherwise, except as
required by law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201221005175/en/
For Investors: Caroline Paul
Gilmartin Group investors@ontrak-inc.com
Ontrak (NASDAQ:OTRK)
Historical Stock Chart
From Aug 2024 to Sep 2024
Ontrak (NASDAQ:OTRK)
Historical Stock Chart
From Sep 2023 to Sep 2024