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ITEM
5.02:
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APPOINTMENT
OF DIRECTORS
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The Board of Directors has appointed Messrs. Barry D. Michaels
and Michael Cress to serve as members of the Board of Directors of Zynex, Inc., a Nevada corporation (the “Company”).
The appointments are effective January 10, 2018.
The following is biographical information
on Mr. Michaels:
Mr. Michaels, age 67, is a retired senior
executive with both general and financial management experience in emerging growth companies. Mr. Michaels has more than 35 years
of financial and general management experience in the medical device and biotechnology industries with industry leaders including
Medtronic, Johnson and Johnson, and Baxter Healthcare. Mr. Michaels served as Chief Financial Officer of three private and four
publicly traded companies including Cardima, Inc., Lipid Sciences, Inc., ICN Biomedicals, Inc., IntraTherapeutics, Inc., VIA Medical,
and Webster Laboratories. In addition he served as President of a Johnson and Johnson division and acting Chief Executive Officer
of Lipid Sciences, Inc. He has raised nearly $800 million in capital within public and private market environments, has taken two
companies public, and has led three private companies to favorable liquidity events. He has also served as an independent consultant
to medical device and biotechnology companies since 1997 leveraging his strong mix of organizational, operational, and financial
management skills to advise senior management and directors. During his tenure in executive management Mr. Michaels has added over
1,100 jobs to the economy and increased shareholder value by more than $2 billion.
Mr. Michaels holds BA in Audiology and
an MBA in Finance from San Diego State University and is a graduate of the Executive Program at the University of California, Los
Angeles. In addition, he has completed the UCLA Director’s Education Program certification exam and has served as Corporate
Secretary to three publicly traded companies.
Mr. Michaels has also been appointed Audit
Committee Chair of the Company’s Audit Committee. Mr. Michaels qualifies as an audit committee financial expert within the
meaning of Section 407 of the Sarbanes-Oxley Act of 2002 and Item 407(d)(5) of Regulation S-K.
The following is biographical information
on Mr. Cress:
Mr. Cress, age 60, currently serves as Chairman and Managing
Partner of MD Cress Ventures, a national firm that owns, operates and advises companies within the healthcare sector. Mr.
Cress also serves as Chairman of Rainier Healthcare. Prior to MD Cress Ventures he served as the President and CEO of
the Cornerstone Healthcare Group which owns and manages hospitals throughout the country. Mr. Cress also served as Vice
President of Business Development for Kindred Healthcare, a publicly traded healthcare company that owns and operates
hospitals, nursing homes, rehabilitation, pharmacy and other segments of the healthcare continuum. He served as the CEO
of Vencor Hospital of San Diego and was also an Adjunct Professor for the Masters of Healthcare Administration program
at the University of Kansas. Mr. Cress currently serves on several not-for-profit boards including Rachel’s Challenge and
is a co-founder and board member for The Neighborhood as well as serving on the boards or advisory boards of several companies,
including Linley Capital, BankSNB, Rainier Hospice and Sleep Research.
Non-Employee Director Compensation Plan
Effective January
10, 2018, the Company’s Board of Directors adopted the Zynex, Inc. Non-Employee Director Compensation Plan (the “Plan”).
A copy of the Plan is filed herewith as Exhibit 10.1. The following is a summary of the Plan, which is qualified in its entirety
by reference to the Plan:
Under the terms of the Plan, each Non-Employee Director (“NED”),
as defined in the Plan, is entitled to receive:
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1.
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An Annual Retainer in the amount of $40,000. In addition,
an NED who serves as chairman of the Audit Committee will receive an additional $10,000 annually, and an NED who serves as chairman
of the Compensation Committee will receive an additional $5,000 annually (collectively the “Annual Retainer”). The
Annual Retainer will be paid in four equal quarterly installments, in arrears, subject to the NED continuing service on the Board.
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2.
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An equity award (“Award”) consisting of
20,000 shares of restricted Common Stock for the first year of service. For each subsequent year of service, an NED shall be entitled
to an additional Award of 10,000 shares. All Awards are subject to monthly ratable vesting over a period of 36 months.
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Each of Messrs. Michaels and Cress have accepted
the terms of the Plan and will be entitled to compensation in accordance with its terms.