Catasys, Inc. (OTCMKTS:CATS) Files An 8-K Material Modification to Rights of Security Holders

Item 3.03.Material
Modification to Rights of Security
Holders.

The information set forth in Item 8.01 of this Form 8-K current
report is hereby incorporated by reference.

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

The information set forth in Item 8.01 of this Form 8-K current
report is hereby incorporated by reference.

Item 8.01.Other Events.

On April 21, 2017, Catasys, Inc. (the “Company”) filed a
certificate of amendment to its Certificate of Incorporation, as
amended and in effect, with the Secretary of State of the State
of Delaware implementing a 1-for-6 reverse stock splitof the
Company’s common stock, to which each 6 shares of issued and
outstanding common stock converted into 1 share of common stock.
Proportionate voting rights and other rights of common stock
holders will not be affected by the reverse stock split. No
fractional shares of common stock will be issued as a result of
the reverse stock split; stockholders will be paid cash in lieu
of any such fractional shares.

The 1-for-6 reverse stock split became effective at 5:00 p.m.,
Eastern Time, on April 24, 2017, and the Company’s common stock
will trade on the OTCQB Marketplace on a post-split basis at the
open of trading on April 25, 2017. The Company’s post-reverse
split common stock will have a new CUSIP number: 149049 504.
Other terms of the common stock are not affected by the reverse
stock split. The common stock will continue to trade under the
symbol “CATS.”

The Company has approximately 9.4 million post-split shares of
common stock outstanding as a result of the reverse stock split.

The Company’s transfer agent, American Stock Transfer, is acting
as exchange agent for the reverse stock split and will send
instructions to stockholders of record regarding the exchange of
certificates for common stock. Stockholders owning shares via a
broker or other nominee will have their positions automatically
adjusted to reflect the reverse stock split, subject to the
brokers’ particular processes, and will not be required to take
any action in connection with the reverse stock split.

All stock options and warrants to purchase common stock
outstanding and the Company’s common stock reserved for issuance
under the Company’s equity incentive plans immediately prior to
the reverse stock split will be appropriately adjusted by
dividing the number of affected shares of common stock by six
and, as applicable, multiplying the exercise price by six as a
result of the reverse stock split.

A copy of the certificate of amendment to Companys Certificate of
Incorporation, as amended and in effect, is being filed as
Exhibit 3.1 to this Current Report on Form 8-K and is
incorporated herein by reference as though fully set forth
herein.

Item9.01.Financial Statements and Exhibits.

(d)Exhibits.

Catasys, Inc. (OTCMKTS:CATS) Recent Trading Information

Catasys, Inc. (OTCMKTS:CATS) closed its last trading session at 1.48 with 257,270 shares trading hands.