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COMMITMENTS AND CONTINGENCIES
9 Months Ended
Sep. 30, 2025
COMMITMENTS AND CONTINGENCIES  
COMMITMENTS AND CONTINGENCIES

(16)   COMMITMENTS AND CONTINGENCIES

See Note 14 for details regarding commitments under the Company’s long-term leases.

From time to time, the Company may become party to various legal, regulatory, administrative proceedings and other claims in the ordinary course of business. To the extent that such claims, proceedings and/or litigation arise, management would accrue the

estimated exposure for such events when losses are determined to be both probable and estimable. On occasion, the Company engages outside counsel related to a broad range of topics including employment law, third-party payer matters, intellectual property, and regulatory and compliance matters.

Other than described below, the Company is currently not a party to any pending legal proceedings that would give rise to potential loss contingences that would be material to the financial statements.

Certain Investigations and Other Matters

The Company regularly receives requests for information, including subpoenas, from regulators and governmental authorities such as the Securities and Exchange Commission (“SEC”), the Department of Justice (“DOJ”), and various local, state, and federal agencies. The ongoing requests for information include topics such as operations, compliance, finance, data privacy, and other matters related to the Company’s business, its personnel, and related parties. The Company routinely cooperates with such formal and informal requests for information, investigations, and other inquiries. The Company cannot predict the outcome or impact of any ongoing matters. Should the government decide to pursue an enforcement action, there exists the possibility of a material adverse impact on the Company’s business, results of operations, prospects, cash flows, financial position or brand.

Heid

On March 4, 2023, a class action complaint was filed against the Company in the California Superior Court, San Diego County, captioned Heid v. Zynex Medical, Inc., No. 37-2023-11832, alleging violations of the California Invasion of Privacy Act (“CIPA”), California Unfair Competition Law, invasion of privacy, intrusion upon seclusion, and seeking class certification. The complaint seeks class certification, damages and restitution, statutory damages, and costs. The Company has reached a preliminary settlement with the plantiffs that is pending court approval. The Company recorded an accrual related to this matter which is included in accounts payable and accrued expenses in the condensed consolidated balance sheets as of September 30, 2025.