Form 4: Zynex Director's Shares Cancelled Post-Bankruptcy

Zynex Inc. Director Barry D. Michaels reports the cancellation of all common stock for no consideration following the company's Chapter 11 reorganization plan.

Summary

• Barry D. Michaels, a Director of ZYNEX INC, reported a change in beneficial ownership on March 26, 2026.
• 80,001 shares of ZYNEX INC common stock previously held by Mr. Michaels were disposed of at a price of $0 per share.
• Following this transaction, Mr. Michaels beneficially owns 0 shares of ZYNEX INC common stock.
• This action is a direct result of Zynex Inc.'s Third Amended Combined Disclosure Statement and Joint Chapter 11 Plan of Reorganization (the "Plan").
• The Plan was confirmed by the U.S. Bankruptcy Court for the Southern District of Texas on March 19, 2026, and became effective on March 26, 2026.
• Under the Plan, all outstanding shares of Zynex Inc. common stock, including shares issuable under equity awards, options, warrants, and other rights, were cancelled for no consideration, resulting in no recovery for shareholders.

Sentiment

Score: 1

Explanation: StockSavvy.ai views this as an extremely negative event, as existing equity has been completely wiped out with no recovery for shareholders due to a Chapter 11 reorganization.

Negatives

• All outstanding common stock of Zynex Inc. was cancelled for no consideration as part of a Chapter 11 reorganization.
• Shareholders, including Director Barry D. Michaels, received no recovery for their shares, indicating a complete loss of equity investment.
• The company underwent a Chapter 11 Plan of Reorganization, signifying severe financial distress.
• Director Barry D. Michaels' beneficial ownership of Zynex Inc. common stock is now 0 shares.

Risks

• Complete loss of investment for existing shareholders due to the Chapter 11 reorganization.
• The company's severe financial distress led to bankruptcy proceedings.
• Equity securities were cancelled for no consideration, indicating a severe restructuring that wiped out shareholder value.

Future Outlook

The filing does not provide forward-looking statements or guidance beyond the immediate effect of the reorganization plan. The cancellation of all existing equity implies a complete reset, with the future outlook dependent on the new capital structure post-reorganization, which is not detailed here.

Industry Context

StockSavvy.ai notes that Chapter 11 reorganizations typically result in significant or complete loss for existing equity holders, as creditors take precedence in the new capital structure. This event for Zynex Inc. aligns with the severe consequences often seen in bankruptcy proceedings for publicly traded companies, where equity is frequently wiped out to satisfy debt.

Comparison to Industry Standards

• In similar Chapter 11 reorganizations, such as the cases of General Motors (2009) or Lehman Brothers (2008), existing equity holders typically received little to no recovery. For instance, General Motors' pre-bankruptcy common stock was rendered worthless, with new equity issued to creditors and the U.S. Treasury.
• This outcome for Zynex Inc. shareholders, receiving $0 for their shares, is consistent with the most severe outcomes for equity in corporate bankruptcies, where the value is entirely absorbed by senior creditors.

Legal Proceedings

• The company underwent a Chapter 11 Plan of Reorganization, confirmed by the U.S. Bankruptcy Court for the Southern District of Texas on March 19, 2026.

Stakeholder Impact

• Shareholders: Existing shareholders, including Director Barry D. Michaels, experienced a complete loss of their investment as all common stock was cancelled for no consideration.
• Creditors: While not detailed in this filing, creditors would typically be the primary beneficiaries of a Chapter 11 reorganization, receiving new equity or debt in the reorganized entity.

Key Dates

Recommendation

The filing indicates that all outstanding common stock of Zynex Inc. has been cancelled for no consideration as part of a Chapter 11 reorganization. This means existing shares are worthless, and investors holding these shares have lost their entire investment. A "Strong Sell" recommendation is appropriate as the equity has been wiped out.

Keywords

Zynex Inc, ZYXI, Chapter 11, Bankruptcy, Stock Cancellation, Reorganization Plan, Beneficial Ownership, Form 4, Barry D. Michaels, Equity Loss