SCHEDULE 13D/A: Major Shareholder Group Increases Stake in Ontrak, Inc. Through New Debt and Warrants

Acuitas Group Holdings, LLC and affiliated entities, led by Terren S. Peizer, have further solidified their dominant ownership in Ontrak, Inc. by acquiring an additional $1.3 million Demand Note and associated warrants.

Summary

• Acuitas Group Holdings, LLC, Acuitas Capital LLC, Humanitario Capital LLC, and Terren S. Peizer (collectively, the "Reporting Persons") filed Amendment No. 31 to their Schedule 13D, updating their beneficial ownership in Ontrak, Inc.
• The filing reports the purchase by Acuitas Capital of an additional Demand Note with a principal amount of $1,300,000 on May 27, 2025, funded by working capital.
• In connection with this Demand Note, Acuitas received a Demand Warrant to purchase up to 1,635,220 shares of Ontrak Common Stock, exercisable at an initial price of $1.59 per share.
• As of the filing date, Terren S. Peizer is deemed to have beneficial ownership of 55,897,441 shares, representing approximately 96.1% of the total shares outstanding (based on 58,177,676 deemed outstanding shares).
• Acuitas Group Holdings, LLC beneficially owns 37,808,412 shares (90.3% of 41,894,127 deemed outstanding).
• Acuitas Capital LLC beneficially owns 14,777,790 shares (77.8% of 18,995,638 deemed outstanding).
• Humanitario Capital LLC beneficially owns 18,089,029 shares (88.2% of 20,501,397 deemed outstanding).
• The beneficial ownership figures include shares currently owned, shares underlying New Keep Well Warrants, Private Placement Securities, Surviving Note conversions, outstanding Demand Notes conversions, Demand Warrants, and Conversion Warrants.
• Conversion prices for the Surviving Note, Demand Notes, and Conversion Warrants are assumed at $1.80 per share, with any accrued interest paid in cash.

Sentiment

Score: 6

Explanation: The sentiment is moderately positive. While the high concentration of ownership and reliance on debt financing could be seen as negatives, the continued financial support from a major shareholder group provides stability and indicates ongoing commitment, which is generally positive for a company that may be in need of capital.

Positives

• The continued investment by Acuitas Capital, a significant shareholder, provides ongoing financial support to Ontrak, Inc., indicating confidence from a key stakeholder.
• The $1.3 million capital injection from the Demand Note provides additional working capital for the company.

Negatives

• The high percentage of beneficial ownership by a single group (Terren S. Peizer and affiliates at 96.1%) could raise concerns about liquidity and public float for other investors.
• The issuance of additional notes and warrants suggests ongoing reliance on debt and dilutive instruments for financing.

Risks

• Significant concentration of ownership by the Reporting Persons could limit the influence of other shareholders and potentially impact corporate governance.
• The conversion of notes and exercise of warrants at specified prices could lead to substantial dilution for existing shareholders not part of the Reporting Persons group.
• The company's continued reliance on financing from Acuitas Capital via Demand Notes and Warrants may indicate ongoing financial challenges or limited access to other capital sources.

Future Outlook

The document primarily details past and current ownership structures and a recent financing transaction. It does not provide explicit forward-looking statements or guidance regarding the company's operational or financial performance, beyond the ongoing nature of the Keep Well Agreement.

Industry Context

This filing is a routine update on significant shareholder ownership and financing activities, typical for companies that rely on specific investors for capital. It does not provide broader industry context or trends.

Related Party Transactions

• The transactions involve Acuitas Capital LLC, a wholly-owned subsidiary of Acuitas Group Holdings, LLC, and Humanitario Capital LLC, all of which are controlled by Terren S. Peizer, who is also a significant beneficial owner of Ontrak, Inc. This indicates ongoing related-party financing and ownership arrangements.

Stakeholder Impact

• Shareholders: Existing shareholders not affiliated with the Reporting Persons may experience significant dilution due to the conversion of notes and exercise of warrants. The high concentration of ownership by the Reporting Persons could also limit liquidity and influence for other shareholders.
• Company (Ontrak, Inc.): Benefits from continued access to capital through the Demand Notes, supporting its operations and potentially its strategic initiatives.

Key Dates

Keywords

Ontrak Inc., Acuitas Group Holdings, Acuitas Capital, Humanitario Capital, Terren S. Peizer, Schedule 13D, Beneficial Ownership, Demand Note, Demand Warrant, Equity Dilution, Capital Raise, SEC Filing, Common Stock