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Zynex, inc – Investor Newsletter
$250 Million Competitor Closes

The electrotherapy industry experienced a significant development when our largest competitor DJO/Empi announced the closure of their Empi electrotherapy division effective December 2015. Empi previously held a large share of the electrotherapy market with approximately $250 million in annual revenue.

The closure of DJO’s Empi division affected the availability of Empi TENS products at many clinics. We experienced a large uptick in orders immediately. With the hiring of former Empi reps, we saw a significant increase in orders over the following months.

Zynex, Inc. Announces FDA Filing for Blood Volume Monitor
LONE TREE, Colo., September 23, 2015

Zynex (OTCQB: ZYXI), an innovative medical technology company specializing in the manufacture and sale of non-invasive medical devices for pain management, stroke rehabilitation, cardiac and neurological diagnostics, announced today that its wholly-owned subsidiary,
Zynex Monitoring Solutions Inc., has filed an application with the Food and Drug Administration pursuant to Section 510(k) of the Food, Drug and Cosmetic Act for clearance of its new CM1500 monitoring device. The CM1500 is capable of monitoring a patient’s
fluid levels, including blood loss, during surgery and in recovery.

Thomas Sandgaard, Zynex CEO stated: “We are excited to have reached the point of applying for FDA clearance for our revolutionary device that will enable surgical personnel to non-invasively monitor blood loss in real time. We have begun placing initial production
units in hospitals for field testing and validation.” Sandgaard went on to say, “Undetected blood loss continues to be a significant risk during surgery and recovery, and current approaches are either too invasive or lacking precision and early predictive
capability for blood loss and intervention. The CM1500 will reduce the risk of blood loss going undetected.”

Zynex Reports Increase in Electrotherapy Orders for March
LONE TREE, Colo. – April 8, 2016 

Zynex,Inc. (OTCBB: ZYXI), announced today March orders for the electrotherapy product line.
Thomas Sandgaard, Founder and CEO of Zynex said: “In March we processed 3,006 patient files, primarily for our NexWave electrotherapy device. This represents about a 7%, month over month, increase from our February 2016 order level for electrotherapy products.

We are still experiencing bottlenecks keeping pace with the increased level of new orders, as well as providing demo units for clinics that our many new sales reps have been servicing for years while they were previously representing Empi. We are working diligently
with our lenders to obtain additional funds to support the higher activity level.”

Revenue from the placement of a NexWave electrotherapy unit is normally derived over time from monthly billings for the sale or rental, and from monthly supplies during the treatment period after the initial patient order.

Zynex First Quarter 2016 Results
LONE TREE, Colo. – May 25, 2016 

Zynex, Inc. (OTCQB: ZYXI), net revenue was $3,477,000 for the first quarter of 2016, compared to $3,183,000 for the first quarter of 2015. Revenue in the first quarter was negatively impacted by significant inertia in getting the many new files billed due to
lack of billing personnel. As well, a large payment from an insurance company was not recorded in revenue but rather reserved in the balance sheet’s liabilities as a precaution in case the money would be taken back – an event that is common in our industry.
Gross profit margin in the quarter was 72%.

The Company reported Selling, General and Administrative (“SG&A”) expenses of $2,844,000 for the first quarter of 2016, compared to $2,710,000 for the quarter ended March 31, 2015, an increase of $134,000 primarily attributed to a significant increase in sales

For the first quarter 2016, the Company reported a net loss of $444,000, or $0.01 per share, compared to a net loss of $896,000, or $0.03 per share in the same period of 2015. For the nine months ended September 30, 2015, the Company reported a net loss of
$1,711,000, or $0.05 per share, compared to a net loss of $6,724,000, or $0.22 per share in 2014.
Cash provided by operations in the first quarter 2016 was $666,000 versus $163,000 in the first quarter of 2015.

The Company’s line of credit balance as of March 31, 2016 was $3,362,000, a reduction of $640,000 since December 31, 2015.

Zynex Recognized in Top 100 Public 
Companies by ColoradoBiz

LONE TREE, Colo. – June 17, 2016 

Zynex (OTCQB: ZYXI), an innovative medical technology company specializing in the manufacture and sale of non-invasive medical devices for pain management, stroke rehabilitation, neurodiagnostic equipment, cardiac and blood volume monitoring, announces today
that ColoradoBiz Magazine has recognized Zynex in Top100 Public Companies in its May 2016 issue.

Zynex was ranked as number 93 based on 2015 revenue of $11.6 million and was the year before listed as number 87 based on $11.1 million in revenue. Zynex has previously estimated 2016 revenue to come in above $16 million and is currently facing cash constraints
that limit production and order growth. Orders have more than doubled since the beginning of the year after the closure of the largest competitor in the electrotherapy industry.

Zynex Reports 2015 Year End Results
LONE TREE, Colo. –  April 1, 2016  

Zynex, Inc. (OTCBB: ZYXI), net revenue increased 5% to $11,642,000 for 2015, compared to $11,117, 000 for the year ended December 31, 2014. The increase was primarily due to better collections in insurance billing while electrotherapy orders remained relatively
flat during 2014 and 2015. 10% of the revenue in both 2014 and 2015 stemmed from the sale of compound pain creams.
The Company reported Selling, General and Administrative (“SG&A”) expenses of $9,185,000 for 2015, compared to $11,397,00 for the year ended December 31, 2014. Decreases in the Company’s SG&A expenses during 2014 were primarily attributable reduced operating
expenses and headcount reductions during the year.
The Company reported a net loss of $2.9 million or nine cents per share for the full year of 2015 compared to a net loss of $6.2 million in 2014 or twenty cents per share.
The Company’s cash and line of credit balance as of December 31, 2015 was $8,000 and $4,002,000, respectively, as compared to cash and line of credit balance as of December 31, 2014 of $63,000 and $4,442,000. The line of credit balance was reduced further down
to $3.3 million by the end of March this year.

Zynex Appoints Distributor in Taiwan
LONE TREE, Colo. – December 21, 2015

Zynex (OTCQB: ZYXI), announced today that it has appointed Deltason Medical as its distributor in Taiwan for its NeuroMove(TM) product line.

CEO, Thomas Sandgaard, said: “We have done business with Deltason in Hong Kong and China for several years and have been very impressed by their professionalism and their ability to promote our NeuroMove devices. We agreed to expand their territory to also
include Taiwan and Macau.”

The NeuroMove(TM) is a FDA cleared device for Stroke Rehab that has been proven effective in many clinical studies. The NeuroMove technique assists patients in teaching healthy parts of the brain after a stroke to take over lost functionality through Neuroplasticity.
Many stroke and spinal cord injured patients in the US and abroad have experienced dramatic results with the device. NeuroMove works by detecting the attempts to move a muscle group sent from the brain, combining muscle contraction, visual and sensory feedback
to assist the patient with relearning the movement.

Zynex Executive News
June 1, 2016

Zynex (ZYXI), announces today the hire of Rick Luckenbill as Vice President of Finance. Paul Oberman, interim CFO consultant since October 2015 will still be available for the Company on an as-needed basis. Mr. Luckenbill has more than 20 years’ experience
in multiple industries with proven leadership in finance, accounting and system integration roles. Mr. Luckenbill’s work experience includes debt restructure, cash flow optimization, profitability improvement and system integration. Prior to joining Zynex,
Mr. Luckenbill, during 2015 and 2016, served as Chief Financial Officer / Vice President of Finance with CPP, Inc., an engineering consulting business in Fort Collins, CO. Previously, Mr. Luckenbill served in various accounting roles with Medtronic, Inc. (2013-2015),
Thermo Fisher Scientific, Inc (2009-2011), Omnitrax, Inc (2009) and Motorola, Inc. (1996-2009) and as director of systems integration with Motorola Solutions, Inc. (2011-2013). Mr. Luckenbill holds an MBA, Finance from the Keller Graduate School of Management
of DeVry University, Scottsdale, AZ and a BS, Finance/Organizational Development, Elmhurst College, Elmhurst, IL.

June 6, 2016

Zynex (ZYXI), announces today the hire of David “Skip” Mogill as Vice President of Operations. Robert Cozart that had served in this position for over 9 years retired at the end of May this year. Mr. Mogill has more than 30 year of experience in the medical
device industry with proven leadership in production, supply chain and operational process efficiency roles. Prior to joining Zynex, Mr. Mogill served as Vice President of Operations with Surgical Technologies Sector SQE and Solta Medical/SST. Previously,
Mr. Mogill served in various operations management positions with Glucon Inc., Dentsply International and various other medical device manufacturing companies including Covidien between 1986 and 2006. Mr. Mogill holds a BS in Mechanical Engineering Technology
from Metro State University of Denver.


The NexWave™ incorporates IFC, TENS & NMES in one easy to use device. This unique 3-modalities-in-1 device is designed to break the pain cycle by:
•    Managing symptomatic relief of chronic intractable pain, post-traumatic pain & post-surgical pain
•    Relaxing muscle spasms
•    Increasing local blood circulation
•    Maintaining or increasing ROM
•    Preventing or retarding disuse atrophy
•    Re-educating muscles 

CM-1500 Blood Volume Monitor

The Zynex Blood Volume Monitor is the first device to non-invasively indicate fluid balance and blood loss in the OR and potential internal bleeding in the Recovery Room.
Zynex has filed an application with the Food and Drug Administration pursuant to Section 510(k) of the Food, Drug and Cosmetic Act for clearance – September 23, 2015.


The NeuroMove® is a re-learning tool. Once a stroke has occurred, the brain has lost neurons that cause paralysis to limbs and other body functions. The NeuroMove® is used to train healthy neurons to assume functions lost by damaged
brain cells. This rehabilitation tool can be used on all paralyzed muscles even when there is no movement available. It works with Traumatic Brain Injury and Spinal Cord Injury patients. It is sophisticated enough to use in the clinic yet simple enough for
patients to use at home. Thirty minutes a day in four to five months can provide dramatic results. 

Letter from the CEO, Thomas Sandgaard
July, 2016

I am very excited about the two huge opportunities in front of us – the $250 million gap in the electrotherapy market and the upcoming introduction of our unique Blood Volume Monitor.

Zynex has experienced tremendous order growth in the first half of 2016 compared to the past two years in the market for home electrotherapy. The US market for home electrotherapy was nearly half a billion annually when DJO decided to close their Empi division
late last year. We have hired many of their seasoned sales reps and instantly grew orders to more than twice last year’s level. Only a lack of funding to build an increasing amount of NexWave devices and increasing sales commission is holding us back from
growing orders past the 25,000 orders per month that DJO/Empi traditionally experienced. We still operate under a default forbearance with our lender and even though our cash flow has allowed us to pay down the balance from $4.8 million to $3.3 million over
the past two years, we only have limited funds available for operations.

Our non-invasive Blood Volume Monitor has been tested in numerous settings by now, including blood donations where our proprietary Index clearly show a strong correlation with blood lost even at levels less than 500 ml. We submitted our application to the FDA
in the fall of last year and are in a dialog with the FDA about clearing the device for sale in the US. This is a very unique device that will allow hospitals an easy-to-use tool for better fluid management.

We have previously estimated 2016 revenue to come in at $16 million and positive net income, a 35% revenue increase over 2015.

Thomas Sandgaard
Founder, Chairman and CEO

About Zynex

Zynex, founded in 1996, markets and sells its own design of electrotherapy medical devices used for pain management and rehabilitation; and the company’s proprietary NeuroMove device designed to help recovery of stroke and spinal cord injury patients. Zynex
is also developing a new blood volume monitor for use in hospitals and surgery centers. For additional information, please visit:

Safe Harbor Statement 
Certain statements in this release are “forward-looking” and as such are subject to numerous risks and uncertainties. Actual results may vary significantly from the results expressed or implied in such statements. Factors that could cause actual results to
materially differ from forward-looking statements include, but are not limited to, the need to obtain additional capital or augment our liquidity in order to continue our business, the success of our compound pharmacy and international expansion efforts, our
ability to engage additional sales representatives, the success of such additional sales representatives, the need to obtain FDA clearance and CE marking of new products, the acceptance of new products as well as existing products by doctors and hospitals,
larger competitors with greater financial resources, the need to keep pace with technological changes, our dependence on the reimbursement from insurance companies for products sold or rented to our customers, acceptance of our products by health insurance
providers, our dependence on third party manufacturers to produce our goods on time and to our specifications, implementation of our sales strategy including a strong direct sales force, the uncertain outcome of pending material litigation and other risks
described in our filings with the Securities and Exchange Commission including the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2015.

Copyright © 2016 Zynex, Inc., All rights reserved.