ROBERT E. BLACKBURN, District Judge.
This matter is before me on the
WHEREAS, a consolidated class action is pending before the Court entitled Mishkin v. Zynex, Inc., et al., Civil Action No. 1:09-cv-00780-REB-KLM (the "Litigation");
WHEREAS, the Court has received the Stipulation of Settlement dated as of November, 8, 2011 (the "Stipulation"), that has been entered into by the Lead Plaintiffs and Defendants, and the Court has reviewed the Stipulation and its attached Exhibits;
WHEREAS, the parties having made an application, pursuant to Federal Rule of Civil Procedure 23(e), for an order preliminarily approving a settlement class and the settlement of this Litigation, in accordance with the Stipulation which, together with the Exhibits annexed thereto sets forth the terms and conditions for a proposed settlement of the Litigation and for dismissal of the Litigation with prejudice upon the terms and conditions set forth therein; and the Court having read and considered the Stipulation and the Exhibits annexed thereto; and
WHEREAS, all defined terms contained herein shall have the same meanings as set forth in the Stipulation;
NOW, THEREFORE, IT IS HEREBY ORDERED:
1. The Court does hereby preliminarily approve the Stipulation and the settlement set forth therein, subject to further consideration at the Settlement Hearing described below.
2. The Court hereby certifies a Class, for settlement purposes only, defined as: All Persons who purchased Zynex common stock between May 21, 2008 and March 31, 2009, inclusive. Excluded from the Class are Defendants, members of the immediate families of the Individual Defendants, any entity in which any Defendant has or had a controlling interest, current or former directors and officers of Zynex, and the legal representatives, heirs, successors, or assigns of any such excluded person or entity. Also excluded from the Class are those Persons who timely and validly request exclusion from the Class pursuant to the Notice of Pendency and Proposed Settlement of Class Action.
3. With respect to the Settlement Class, this Court finds that: (a) the Members of the Settlement Class are so numerous that joinder of all Settlement Class Members in the action is impracticable; (b) there are questions of law and fact common to the Settlement Class that predominate over any individual questions; (c) the claims of the Plaintiffs are typical of the claims of the Settlement Class; (d) Plaintiffs and their counsel have fairly and adequately represented and protected the interests of the Settlement Class Members; and (e) a class action is superior to other available methods for the fair and efficient adjudication of the controversy, considering: (i) the interests of the Members of the Settlement Class in individually controlling the prosecution of the separate actions; (ii) the extent and nature of any litigation concerning the controversy already commenced by Members of the Settlement Class; (iii) the desirability or undesirability of concentrating the litigation of these claims in this particular forum; and (iv) the difficulties likely to be encountered in the management of the action.
4. A hearing (the "Settlement Hearing") shall be held before this Court on
5. The Court approves, as to form and content, the Notice of Pendency and Proposed Settlement of Class Action (the "Notice"), the Proof of Claim and Release form (the "Proof of Claim"), and Summary Notice for publication annexed as Exhibits A-1, A-2 and A-3 hereto, and finds that the mailing and distribution of the Notice and publishing of the Summary Notice substantially in the manner and form set forth in ¶ 6 of this Order meet the requirements of Federal Rule of Civil Procedure 23 and due process, and is the best notice practicable under the circumstances and shall constitute due and sufficient notice to all Persons entitled thereto.
6. Pursuant to Rule 53(c) of the Federal Rules of Civil Procedure, the Court appoints Class Action Administration, Inc. ("Claims Administrator") to supervise and administer the notice procedure as well as the processing of claims as more fully set forth below:
(a) Not later than
(b) Not later than
(c) At least seven (7) calendar days prior to the Settlement Hearing, Lead Counsel shall cause to be served on Defendants' counsel and filed with the Court proof, by affidavit or declaration, of such mailing and publishing.
7. Nominees who held Zynex common stock purchased between May 21, 2008 and March 31, 2009, inclusive, for the benefit of another shall send the Notice and the Proof of Claim to all beneficial owners of such Zynex common stock within ten (10) days after receipt thereof, or send a list of the names and addresses of such beneficial owners to the Claims Administrator within ten (10) days of receipt thereof, in which event the Claims Administrator shall promptly mail the Notice and Proof of Claim to such beneficial owners. Lead Counsel shall, if requested, reimburse banks, brokerage houses or other nominees solely for their reasonable out-of-pocket expenses incurred in providing notice to beneficial owners who are Class Members out of the Class Notice and Administration Fund, which expenses would not have been incurred except for the sending of such notice, subject to further order of this Court with respect to any dispute concerning such compensation.
8. All Members of the Class shall be bound by all determinations and judgments in the Litigation concerning the settlement, whether favorable or unfavorable to the Class.
9. Class Members who wish to participate in the settlement shall complete and submit Proof of Claim forms in accordance with the instructions contained therein. Unless the Court orders otherwise, all Proof of Claim forms must be submitted no later than
10. Any Person who desires to request exclusion from the Class shall do so no later than
11. Any Member of the Class may enter an appearance in the Litigation, at their own expense, individually or through counsel of their own choice. If they do not enter an appearance, they will be represented by Lead Counsel.
12. Any Person falling within the definition of the Settlement Class may, upon request, be excluded from the Settlement Class. Any such Person must submit to the Claims Administrator a request for exclusion ("Request for Exclusion"), postmarked no later than
13. All papers in support of the settlement, the Plan of Allocation, and the application by Lead Counsel for attorneys' fees or expenses or by Lead Plaintiffs for expenses shall be filed and served
14. Any Member of the Class may appear and show cause, if he, she or it has any reason, why the proposed settlement of the Litigation should or should not be approved as fair, reasonable and adequate, why a judgment should or should not be entered thereon, why the Plan of Allocation should or should not be approved, or why attorneys' fees and expenses should or should not be awarded to Lead Counsel, or why the Lead Plaintiffs' expenses should or should not be reimbursed; provided, however, that no Class Member or any other Person shall be heard or entitled to contest the approval of the terms and conditions of the proposed settlement, or, if approved, the Judgment to be entered thereon approving the same, or the order approving the Plan of Allocation, the attorneys' fees and expenses to be awarded to Lead Counsel or the expenses to be reimbursed to Lead Plaintiffs, unless that Person has filed with the Clerk of the United States District Court for the District of Colorado, on or before
15. All funds held by the Escrow Agent shall be deemed and considered to be in custodia legis of the Court, and shall remain subject to the jurisdiction of the Court, until such time as such funds shall be distributed pursuant to the Stipulation and/or further order(s) of the Court.
16. Neither Defendants nor their Related Parties shall have any responsibility for or liability with respect to the Plan of Allocation or any application for attorneys' fees or expenses submitted by Lead Counsel or Lead Plaintiffs, and such matters will be considered separately from the fairness, reasonableness and adequacy of the settlement.
17. At or after the Settlement Hearing, the Court shall determine whether the Plan of Allocation proposed by Lead Counsel, and any application for attorneys' fees or expenses shall be approved.
18. All reasonable expenses incurred in identifying and notifying Class Members, as well as administering the Settlement Fund, shall be paid as set forth in the Stipulation. In the event the settlement is not approved by the Court, or otherwise fails to become effective, neither the Lead Plaintiffs nor Lead Counsel shall have any obligation to repay any amounts actually and properly disbursed from the Class Notice and Administration Fund.
19. Neither the Stipulation, nor any of its terms or provisions, nor any of the negotiations or proceedings connected with it, shall be construed as an admission or concession by Defendants or their Related Parties of the truth of any of the allegations in the Litigation, or of any liability, fault, or wrongdoing of any kind.
20. The Court reserves the right to adjourn the date of the Settlement Hearing without further notice to the Members of the Class, and retains jurisdiction to consider all further applications arising out of or connected with the proposed settlement. The Court may approve the settlement, with such modifications as may be agreed to by the Settling Parties, if appropriate, without further notice to the Class.
21. The
22. Lead counsel shall ensure that the Notice (Exhibit A-1), Proof of Claim (Exhibit A-2), and Summary Notice (Exhibit A-3) all contain accurate statements of the deadlines stated in this order, accurate mailing addresses for the claims administrator and for counsel named in the notice, and, in paragraph seven (7), an accurate phone number for the claims administrator.
IT IS SO ORDERED.
A federal court authorized this Notice. This is not a solicitation from a lawyer.
1.
Your legal rights are affected whether you act or choose not to act. Read this Notice carefully.
You or someone in your family may have purchased shares of Zynex common stock between May 21, 2008 and March 31, 2009, inclusive.
The Court sent you this Notice because you have a right to know about a proposed settlement of a class action lawsuit, and about all of your options, before the Court decides whether to approve the settlement. If the Court approves it and after any objections or appeals are resolved, the Claims Administrator appointed by the Court will make the payments that the settlement allows.
This package explains the lawsuit, the settlement, your legal rights, what benefits are available, who is eligible for them, and how to get them.
The Court in charge of the case is the United States District Court for the District of Colorado, and the case is known as Mishkin v. Zynex, Inc., et al., Civil Action No. 1:09-cv-00780-REB-KLM. The people who sued are called the Lead Plaintiffs, and the company and the individuals they sued, Zynex, Inc., Thomas Sandgaard, and Fritz G. Allison, are called the Defendants.
The action is brought on behalf of those who purchased Zynex publicly traded securities between May 21, 2008 and March 31, 2009. Lead Plaintiffs allege that Defendants made false and misleading statements, assert claims for violations of the federal securities laws, and seek compensatory damages and other relief. The operative complaint is primarily based upon allegations of wrongdoing in connection with the Company's announcement of its intention to restate previously issued financial statements for the first three fiscal quarters ended of 2008.
The Defendants have denied and continue to deny each and all of the claims and contentions alleged by the Lead Plaintiffs in the lawsuit. Defendants assert they employed reasonable reserve estimates and that any changes in collection experience, which resulted in the restatement of previously issued financial statements, were the result of unanticipated developments. The Defendants expressly have denied and continue to deny all charges of wrongdoing or liability against them arising out of any of the conduct, statements, acts or omissions alleged, or that could have been alleged, in the lawsuit.
In a class action, one or more people called class representatives (in this case the Court-appointed Lead Plaintiffs, John Trommald, Heather Trommald, and Howard Makler), sue on behalf of people who have similar claims. Here, all these people are called a Class or Class Members. One court resolves the issues for all Class Members, except for those who timely and validly exclude themselves from the Class. Judge Robert E. Blackburn is in charge of this class action.
The Court did not decide in favor of Lead Plaintiffs or Defendants. Instead, both sides agreed to a settlement. That way, they avoid the cost and uncertainty of further litigation and a trial, and eligible Class Members who submit valid claims will receive compensation. The Lead Plaintiffs and their attorneys think the settlement is fair, reasonable, and adequate.
To see if you will receive money from this settlement, you first have to determine if you are a Class Member.
The Class includes all Persons who purchased Zynex common stock between May 21, 2008 and March 31, 2009, inclusive, except those persons and entities that are excluded, as described below.
You are not a Class Member if you are a Defendant, a member of the immediate family of one of the individual defendants, an entity in which any Defendant has or had a controlling interest, a current or former director or officer of Zynex, a legal representative, heir, successor, or assign of any excluded party.
If you sold Zynex common stock between May 21, 2008 and March 31, 2009, that alone does not make you a Class Member. You are a Class Member only if you purchased Zynex common stock between May 21, 2008 and March 31, 2009.
If you are still not sure whether you are included, you can ask for free help. You can call Class Action Administration, Inc. (the "Claims Administrator") at 1-800- ___ - ____ for more information. Or you can fill out and return the claim form described in question 10, to see if you qualify.
Defendants have agreed to pay $2.5 million in cash. The balance of this fund after payment of Court-approved attorneys' fees and expenses and Lead Plaintiffs' expenses and the costs of claims administration, including the costs of printing and mailing this Notice and the cost of publishing newspaper notice (the "Net Settlement Fund") will be divided among all eligible Class Members who send in valid claim forms.
The Net Settlement Fund will be distributed to Class Members who submit valid, timely Proof of Claim and Release forms ("Authorized Claimants") under the Plan of Allocation described below. The Plan of Allocation provides that you will be eligible to participate in the distribution of the Net Settlement Fund only if you have a net loss on all transactions in Zynex common stock during the Class Period.
For purposes of determining the amount an Authorized Claimant may recover under the Plan of Allocation, Lead Counsel have consulted with their damage consultants and the Plan of Allocation reflects an assessment of the damages that they believe could have been recovered had Lead Plaintiffs prevailed at trial.
To the extent there are sufficient funds in the Net Settlement Fund, each Authorized Claimant will receive an amount equal to the Authorized Claimant's claim, as defined below. If, however, the amount in the Net Settlement Fund is not sufficient to permit payment of the total claim of each Authorized Claimant, then each Authorized Claimant shall be paid the percentage of the Net Settlement Fund that each Authorized Claimant's claim bears to the total of the claims of all Authorized Claimants. Payment in this manner shall be deemed conclusive against all Authorized Claimants.
A claim will be calculated as follows:
For shares of common stock purchased between May 21, 2008 and March 31, 2009, inclusive:
A. For shares held at the end of trading on June 29, 2009, the Recognized Loss shall be that number of shares multiplied by the lesser of:
B. For shares sold between May 21, 2008 and March 31, 2009, inclusive, the Recognized Loss shall be that number of shares multiplied by the lesser of:
C. For shares sold between April 1, 2009 and June 29, 2009, the Recognized Loss shall be the lesser of:
The date of purchase or sale is the "contract" or "trade" date as distinguished from the "settlement" date.
For Class Members who held Zynex common stock at the beginning of the Class Period or made multiple purchases or sales during the Class Period, the first-in, first-out ("FIFO") method will be applied to such holdings, purchases and sales for purposes of calculating a claim. Under the FIFO method, sales of shares during the Class Period will be matched, in chronological order, first against securities held at the beginning of the Class Period. The remaining sales of securities during the Class Period will then be matched, in chronological order, against securities purchased during the Class Period.
A Class Member will be eligible to receive a distribution from the Net Settlement Fund only if a Class Member had a net loss, after all profits from transactions in Zynex common stock during the Class Period are subtracted from all losses. However, the proceeds from sales of securities which have been matched against stock held at the beginning of the Class Period will not be used in the calculation of such net loss. No distributions will be made to Authorized Claimants who would otherwise receive a distribution of less than $10.00.
The Court has reserved jurisdiction to allow, disallow or adjust the claim of any Class Member on equitable grounds.
Payment pursuant to the Plan of Allocation set forth above shall be conclusive against all Authorized Claimants. No Person shall have any claim against Lead Counsel or any claims administrator or Defendants or other person designated by Lead Counsel or Defendants or Defendants' counsel based on distributions made substantially in accordance with the Stipulation and the settlement contained therein, the Plan of Allocation, or further orders of the Court. All Class Members who fail to complete and submit a valid and timely Proof of Claim and Release form shall be barred from participating in distributions from the Net Settlement Fund (unless otherwise ordered by the Court), but otherwise shall be bound by all of the terms of the Stipulation, including the terms of any judgment entered and the releases given.
To qualify for payment, you must be an eligible Class Member, send in a valid claim form, and properly document your claim as requested in the claim form. A claim form is enclosed with this Notice. Read the instructions carefully, fill out the form, include all the documents the form asks for, sign it, and mail it in the enclosed envelope postmarked no later than ____________, 2012.
The Court will hold a hearing on _________, 2012, to decide whether to approve the settlement. If Judge Blackburn approves the settlement, there may be appeals. It is always uncertain whether these appeals can be resolved, and resolving them can take time, perhaps several years. Everyone who sends in a claim form will be informed of the determination with respect to their claim. Please be patient.
Unless you timely and validly exclude yourself, you are staying in the Class, and that means that you cannot sue, continue to sue, or be part of any other lawsuit against the Defendants about the Released Claims in this case. It also means that all of the Court's orders will apply to you and legally bind you and you will release your claims in this case against the Defendants. The terms of the release are included in the claim form that is enclosed.
If you do not want a payment from this settlement, but you want to keep the right to sue or continue to sue the Defendants on your own for the Released Claims in this case, then you must take steps to get out of the Class. This is called excluding yourself or is sometimes referred to as opting out of the Class.
To exclude yourself from the Class, you must send a letter by mail stating that you want to be excluded from Mishkin v. Zynex, Inc., et al., Civil Action No. 1:09-cv-00780-REB-KLM. You must include your name, address, telephone number, your signature, and the number of shares of Zynex stock you purchased between May 21, 2008 and March 31, 2009, the number of shares sold during this time period, if any, and the dates of such purchases and sales. You must mail your exclusion request postmarked no later than ________, 2012 to:
You cannot exclude yourself on the phone or by e-mail. If you ask to be excluded, you are not eligible to receive any settlement payment, and you cannot object to the settlement. You will not be legally bound by anything that happens in this lawsuit.
No. Unless you timely and validly exclude yourself, you give up any right to sue the Defendants for the Released Claims in this settlement. If you have a pending lawsuit against any of the Defendants, speak to your lawyer in that case immediately. Remember, the exclusion deadline is _________, 2012.
No. If you exclude yourself, do not send in a claim form. But, you may be able to sue, continue to sue, or be part of a different lawsuit involving the Released Claims against the Defendants.
The Court appointed The Shuman Law Firm and Glancy, Binkow & Goldberg LLP to represent you and other Class Members.
These lawyers are called Lead Counsel. You will not be charged for these lawyers. If you want to be represented by your own lawyer, you may hire one at your own expense.
Lead Counsel will ask the Court for attorneys' fees of 30% of the Settlement Fund and for payment of their expenses up to $137,000.00 (an average cost of $0.11per share of common stock), which were incurred in connection with the litigation. Lead Plaintiffs may also request payment for their expenses (including lost wages) incurred in representing the Class in an amount not to exceed $8,000. Such sums as may be approved by the Court will be paid from the Settlement Fund. Class Members are not personally liable for any such fees or expenses.
The attorneys' fees and expenses requested will be the only payment to Lead Counsel for their efforts in achieving this settlement and for their risk in undertaking this representation on a wholly contingent basis. To date, Lead Counsel have not been paid for their services in conducting this litigation on behalf of the Lead Plaintiffs and the Class, nor for their substantial expenses. The fee requested will compensate Lead Counsel for their work in achieving the Settlement Fund and is within the range of fees awarded to class counsel under similar circumstances in other cases of this type. The Court may award less than this amount.
You can tell the Court that you do not agree with the settlement or some part of it.
If you are a Class Member, you can object to the settlement if you do not like any part of it, including the Plan of Allocation and the request for attorneys' fees and expenses. In order to object, you must file with the Clerk of the United States District Court for the District of Colorado, on or before ________, 2012: (i) a statement submitted under penalty of perjury of the number of shares of Zynex common stock you purchased and sold during the Class Period, including the date(s) of acquisition or disposition of any such stock with proof thereof; (ii) a statement of your specific objections to the settlement and the judgment to be entered thereon, and/or the award of attorneys' fees and expenses to Plaintiffs' counsel; and (iii) all other documents, writing and other evidence that you desire the Court to consider. You must also must deliver these documents by hand no later than ___________________, or send them by first class mail so that the documents arrive no later than ________________, to each of the following counsel of record: The Shuman Law Firm, Kip B. Shuman, 885 Arapahoe Avenue, Boulder, Colorado 80302; and Fulbright & Jaworski L.L.P., William J. Leone, 370 17
Objecting is simply telling the Court that you do not like something about the settlement. You can object
The Court will hold a hearing to decide whether to approve the settlement. You may attend and you may ask to speak, but you do not have to.
The Court will hold a fairness hearing at ____ __.m., on __________, 2012, at the Alfred A. Arraj United States Courthouse, 901 19th Street, Denver, Colorado. At this hearing the Court will consider whether the settlement is fair, reasonable, and adequate. If there are objections, the Court will consider them. Judge Blackburn will listen to people who have asked to speak at the hearing. The Court will also consider how much to pay to Lead Counsel and the Lead Plaintiffs. The Court may decide these issues at the hearing or take them under consideration. We do not know how long these decisions will take.
No. Lead Counsel will answer questions Judge Blackburn may have. But, you are welcome to come at your own expense. If you send an objection, you do not have to come to Court to talk about it. As long as you mailed your written objection on time, the Court will consider it. You may also pay your own lawyer to attend, but it is not necessary.
You may ask the Court for permission to speak at the fairness hearing. To do so, you must send a letter saying that it is your intention to appear in Mishkin v. Zynex, Inc., et al., Civil Action No. 1:09-cv-00780-REB-KLM. Be sure to include your name, address, telephone number, your signature, the number of shares of Zynex stock purchased and sold between May 21, 2008 and March 31, 2009, inclusive. Your notice of intention to appear must be received no later than __________, 2012, and be sent to the Clerk of the Court, Lead Counsel, and Defendants' counsel, at the addresses listed in question 18. You cannot speak at the hearing if you exclude yourself from the Class.
If you do nothing, you will be a Settlement Class Member, but you will not receive any money from this settlement because it is necessary to submit a valid claim form. But, unless you exclude yourself, you won't be able to start a lawsuit, continue with a lawsuit, or be part of any other lawsuit against the Defendants about the Released Claims in this case.
This Notice summarizes the proposed settlement. More details are in the Stipulation of Settlement dated as of November 8, 2011 ("Stipulation"). You can obtain a copy of the Stipulation on the internet at http://www.classactionadmin.com, or from the Clerk's office at the United States District Court for the District of Colorado, 901 19th Street, Denver, Colorado during regular business hours.
You can call or write to Class Action Administration, Inc., or visit the website at http://www.classactionadmin.com.
The Court has ordered that if you hold or held shares of Zynex common stock purchased between May 21, 2008 and March 31, 2009, inclusive, as nominee for a beneficial owner, then, within ten (10) days after you receive this Notice, you must either: (1) send a copy of this Notice by first class mail to all such Persons; or (2) provide a list of the names and addresses of such Persons to the Claims Administrator:
If you choose to mail the Notice and Proof of Claim yourself, you may obtain from the Claims Administrator (without cost to you) as many additional copies of these documents as you will need to complete the mailing.
Regardless of whether you choose to complete the mailing yourself or elect to have the mailing performed for you, you may obtain reimbursement for or advancement of reasonable administrative costs actually incurred or expected to be incurred in connection with forwarding the Notice and which would not have been incurred but for the obligation to forward the Notice, upon submission of appropriate documentation to the Claims Administrator.
1. To recover as a Member of the Class based on your claims in the action entitled Mishkin v. Zynex, Inc., et al., Civil Action No. 1:09-cv-00780-REB-KLM (the "Litigation"), you must complete and, on page ___ hereof, sign this Proof of Claim and Release. If you fail to file a properly addressed (as set forth in paragraph 3 below) Proof of Claim and Release, your claim may be rejected and you may be precluded from any recovery from the Settlement Fund created in connection with the proposed settlement of the Litigation.
2. Submission of this Proof of Claim and Release, however, does not assure that you will share in the proceeds of settlement in the Litigation.
3. YOU MUST MAIL YOUR COMPLETED AND SIGNED PROOF OF CLAIM AND RELEASE POSTMARKED ON OR BEFORE ________, 2012, ADDRESSED AS FOLLOWS:
If you are NOT a Member of the Class, as defined in the Notice of Pendency and Proposed Settlement of Class Action ("Notice"), DO NOT submit a Proof of Claim and Release form.
4. If you are a Member of the Class, you are bound by the terms of any judgment entered in the Litigation, WHETHER OR NOT YOU SUBMIT A PROOF OF CLAIM AND RELEASE FORM.
1. "Defendants" means Zynex and the Individual Defendants.
2. "Individual Defendants" means Thomas Sandgaard and Fritz G. Allison.
3. "Litigation" means the securities class actions consolidated under the caption Mishkin v. Zynex, Inc. et al., Case No. 09-cv-780-REB-KLM, that are pending in the Federal District Court for the District of Colorado.
4. "Released Persons" means each and all of the Defendants and each and all of their Related Parties.
1. If you purchased Zynex securities and held the certificate(s) in your name, you are the beneficial purchaser as well as the record purchaser. If, however, the certificate(s) were registered in the name of a third party, such as a nominee or brokerage firm, you are the beneficial purchaser and the third party is the record purchaser.
2. Use Part I of this form entitled "Claimant Identification" to identify each purchaser of record ("nominee"), if different from the beneficial purchaser of Zynex securities which form the basis of this claim. THIS CLAIM MUST BE FILED BY THE ACTUAL BENEFICIAL PURCHASER OR PURCHASERS, OR THE LEGAL REPRESENTATIVE OF SUCH PURCHASER OR PURCHASERS OF THE ZYNEX SECURITIES UPON WHICH THIS CLAIM IS BASED.
3. All joint purchasers must sign this claim. Executors, administrators, guardians, conservators and trustees must complete and sign this claim on behalf of Persons represented by them and their authority must accompany this claim and their titles or capacities must be stated. The Social Security (or taxpayer identification) number and telephone number of the beneficial owner may be used in verifying the claim. Failure to provide the foregoing information could delay verification of your claim or result in rejection of the claim.
1. Use Part II of this form entitled "Schedule of Transactions in Zynex Securities" to supply all required details of your transaction(s) in Zynex securities. If you need more space or additional schedules, attach separate sheets giving all of the required information in substantially the same form. Sign and print or type your name on each additional sheet.
2. On the schedules, provide all of the requested information with respect to
3. List each transaction in the Class Period separately and in chronological order, by trade date, beginning with the earliest. You must accurately provide the month, day and year of each transaction you list.
4. Broker confirmations or other documentation of your transactions in Zynex securities should be attached to your claim. Failure to provide this documentation could delay verification of your claim or result in rejection of your claim.
5. The above requests are designed to provide the minimum amount of information necessary to process the most simple claims. The Claims Administrator may request additional information as required to efficiently and reliably calculate your losses. In some cases where the Claims Administrator cannot perform the calculation accurately or at a reasonable cost to the Class with the information provided, the Claims Administrator may condition acceptance of the claim upon the production of additional information and/or the hiring of an accounting expert at the Claimant's cost.
C. Sales of Zynex Access securities (May 21, 2008-March 31, 2009, inclusive):
D. Number of shares of Zynex securities held at close of trading on March 31, 2009: __________
INSERT POA COMMON STOCKS
If you require additional space, attach extra schedules in the same format as above. Sign and print your name on each additional page.
YOU MUST READ AND SIGN THE RELEASE ON PAGE ____.
FOR CALL OPTIONS ZYNEX COMMON STOCK:
INSERT POA CALLS
FOR PUT OPTIONS ON ZYNEX COMMON STOCK:
INSERT POA PUTS
SUBMISSION TO JURISDICTION OF COURT AND ACKNOWLEDGEMENTS
I (We) submit this Proof of Claim and Release under the terms of the Stipulation of Settlement dated as of November 8, 2011 ("Stipulation"), described in the Notice. I (We) also submit to the jurisdiction of the United States District Court for the District of Colorado, with respect to my claim as a Class Member (as defined in the Notice) and for purposes of enforcing the release set forth herein. I (We) further acknowledge that I am (we are) bound by and subject to the terms of any judgment that may be entered in the Litigation. I (We) agree to furnish additional information to Lead Counsel to support this claim if required to do so. I (We) have not submitted any other claim covering the same purchases or sales of Zynex securities during the Class Period and know of no other Person having done so on my (our) behalf.
1. I (We) hereby acknowledge full and complete satisfaction of, and do hereby fully, finally and forever settle, release, relinquish and discharge, all of the Released Claims against each and all of the Defendants and each and all of their "Related Parties," defined as each of a Defendant's past or present directors, officers, employees, partners, insurers, co-insurers, reinsurers, agents, controlling shareholders, attorneys, accountants or auditors, advisors, investment advisors, personal or legal representatives, predecessors, successors, parents, subsidiaries, divisions, joint ventures, assigns, spouses, heirs, related or affiliated entities, any entity in which a Defendant has a controlling interest, any members of an Individual Defendant's immediate family, or any trust of which the Individual Defendant is the settlor or which is for the benefit of the Individual Defendant's family.
2. "Released Claims" means and includes any and all claims, debts, demands, controversies, obligations, losses, rights or causes of action or liabilities of any kind or nature whatsoever (including, but not limited to, any claims for damages (whether compensatory, special, incidental, consequential, punitive, exemplary or otherwise), injunctive relief, declaratory relief, rescission or rescissionary damages, interest, attorneys' fees, expert or consulting fees, costs, expenses, or any other form of legal or equitable relief whatsoever), whether based on federal, state, local, statutory or common law or any other law, rule or regulation, whether fixed or contingent, accrued or un-accrued, liquidated or unliquidated, at law or in equity, matured or unmatured, whether class or individual in nature, including both known claims and Unknown Claims (as defined below) that: (i) have been asserted in this Litigation by Lead Plaintiffs on behalf of the Class and its Class Members against any of the Released Persons, or (ii) have been or could have been asserted in any forum by Lead Plaintiffs, Class Members or any of them against any of the Released Persons, which arise out of, relate to or are based upon the allegations, transactions, facts, matters, occurrences, representations or omissions involved, set forth, or referred to in the Complaint, including any claim that arises out of or relates to the purchase of Zynex common stock by any Lead Plaintiff or any Class Member during the Class Period. Released claims shall also include any claims, debts, demands, controversies, obligations, losses, rights or causes of action that Lead Plaintiffs, Class Members or any of them may have against the Released Persons which involve or relate in any way to the defense of the Litigation or the settlement of the Litigation. Released claims shall include, without limitation, claims for negligence, gross negligence, breach of duty of care and/or breach of duty of loyalty, fraud, breach of fiduciary duty, or violations of any state or federal statutes, rules or regulations. Notwithstanding the foregoing, Released Claims does not include claims to enforce the provisions of this Stipulation or the settlement. Excluded from this release are any and all claims or causes of action which will be or have been brought in the case captioned Steven T. Hatch, derivatively on behalf of Nominal Defendant, Zynex, Inc. v. Thomas Sandgaard, et. al., Case No. 11-CV-01964 (RBJ-KLM) (Colo.).
3. "Unknown Claims" shall collectively mean all claims, demands, rights, liabilities, and causes of action of every nature and description which any Lead Plaintiff or Class Member does not know or suspect to exist in his, her or its favor at the time of the release of the Released Persons which, if known by him, her or it, might have affected his, her or its settlement with and release of the Released Persons, or might have affected his, her or its decision not to object to this settlement. With respect to any and all Released Claims, the Settling Parties stipulate and agree that, upon the Effective Date, the Lead Plaintiffs shall expressly waive, and each of the Class Members shall be deemed to have waived, and by operation of the Judgment shall have waived, the provisions, rights and benefits of California Civil Code § 1542, which provides:
5. This release shall be of no force or effect unless and until the Court approves the Stipulation and it becomes effective on the Effective Date.
6. I (We) hereby warrant and represent that I (we) have not assigned or transferred or purported to assign or transfer, voluntarily or involuntarily, any matter released pursuant to this release or any other part or portion thereof.
7. I (We) hereby warrant and represent that I (we) have included information about all of my (our) transactions in Zynex securities that occurred during the Class Period as well as the number of shares of Zynex securities held by me (us) at the opening of trading on May 21, 2008, and at the close of trading on March 31, 2009.
If you are exempt from backup withholding, enter your correct TIN in Part I and write "exempt" on the following line: _________________________
UNDER THE PENALTY OF PERJURY, I (WE) CERTIFY THAT:
NOTE: If you have been notified by the Internal Revenue Service that you are subject to backup withholding, you must cross out Item 2 above.
SEE ENCLOSED FORM W-9 INSTRUCTIONS
The Internal Revenue Service does not require your consent to any provision of this document other than the certification required to avoid backup withholding.
I declare under penalty of perjury under the laws of the United States of America that the foregoing information supplied by the undersigned is true and correct.
Reminder Checklist:
8. Please sign the above release and declaration.
9. Remember to attach supporting documentation, if available.
10. Do not send original stock certificates.
11. Keep a copy of your claim form for your records.
12. If you desire an acknowledgment of receipt of your claim form, please send it Certified Mail, Return Receipt Requested.
13. If you move, please send us your new address.
TO: ALL PERSONS WHO PURCHASED ZYNEX INCORPORATED ("ZYNEX") COMMON STOCK BETWEEN MAY 21, 2008 AND MARCH 31, 2009
YOU ARE HEREBY NOTIFIED, pursuant to an Order of the United States District Court for the District of Colorado, that a hearing will be held on ___________, 2012, at ____ __.m., before the Honorable Judge Robert E. Blackburn at the Alfred A. Arraj United States Courthouse, 901 19th Street, Denver, Colorado for the purpose of determining (1) whether the proposed settlement of the claims in the Litigation for the sum of $2,500,000 in cash should be approved by the Court as fair, reasonable and adequate; (2) whether, thereafter, this Litigation should be dismissed with prejudice as set forth in the Stipulation of Settlement dated as of November 8, 2011; (3) whether the Plan of Allocation is fair, reasonable and adequate and therefore should be approved; and (4) whether the application of Lead Counsel for the payment of attorneys' fees and expenses and the Lead Plaintiffs' expenses incurred in connection with this Litigation should be approved.
If you purchased Zynex common stock between May 21, 2008 and March 31, 2009, your rights may be affected by the settlement of this Litigation. If you have not received a detailed Notice of Pendency and Proposed Settlement of Class Action ("Notice") and a copy of the Proof of Claim and Release, you may obtain copies by writing to ZYNEX Securities Litigation, Claims Administrator, Class Action Administration, Inc. Class Action Administration, Inc. 10875 Dover Street, Suite 300 Westminster, CO 80021; www.classactionadmin.com. If you are a Class Member, in order to share in the distribution of the Net Settlement Fund, you must submit a Proof of Claim and Release postmarked no later than ____________, 2012, establishing that you are entitled to recovery.
If you desire to be excluded from the Class, you must submit a request for exclusion postmarked by ______________, 2012, in the manner and form explained in the detailed Notice referred to above. All Members of the Class who have not requested exclusion from the Class will be bound by any judgment entered in the Litigation pursuant to the Stipulation of Settlement.
Any objection to the settlement must be mailed or delivered such that it is received by each of the following no later than _________, 2012:
