Electromed Announces Grant of Inducement Equity Awards

NEW PRAGUE, Minn.--(BUSINESS WIRE)--Electromed, Inc. (“Electromed”) (NYSE American: ELMD), a leader in innovative airway clearance technologies, today announced that it granted equity awards on July 1, 2023 as a material inducement to employment of James L. Cunniff, the newly appointed President and Chief Executive Officer of Electromed.

As previously disclosed, Electromed and Mr. Cunniff entered into an employment agreement in connection with Mr. Cunniff’s appointment as President and Chief Executive Officer. Pursuant to the employment agreement, the following equity awards were approved for issuance to Mr. Cunniff by the Personnel and Compensation Committee of the Board of Directors of Electromed in reliance on the employment inducement award exemption under the NYSE American LLC Company Guide Section 711(a): (i) 175,000 performance-based restricted stock units and (ii) an option to purchase 175,000 shares of common stock of Electromed, each in the form of inducement awards on terms substantially similar to Electromed’s 2017 Omnibus Incentive Plan and effective as of July 1, 2023. The option will vest with respect to 25% of the shares on the first anniversary of the date of grant and then quarterly over the remaining three years in twelve substantially equal increments. The performance-based restricted stock units will be eligible to vest and settle into shares of common stock on a 1-for-1 basis with respect to one-half of the shares upon achieving a total shareholder return of 50% and the remaining shares upon a total shareholder return of 100%, in each case within four years of the date of grant.

This press release is being issued by Electromed pursuant to the requirements of the NYSE American.

About Electromed, Inc.

Electromed, Inc. manufactures, markets, and sells products that provide airway clearance therapy, including the SmartVest® Airway Clearance System, to patients with compromised pulmonary function. It is headquartered in New Prague, Minnesota, and was founded in 1992. Further information about Electromed can be found at www.smartvest.com.

Cautionary Statements

Certain statements in this press release constitute forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can generally be identified by words such as “anticipate,” “assume,” “believe,” “continue,” “expect,” “may,” “potential,” “should,” “will,” and similar expressions, including the negative of these terms, but they are not the exclusive means of identifying such statements. Forward-looking statements cannot be guaranteed, and actual results may vary materially due to the uncertainties and risks, known or unknown associated with such statements. Examples of risks and uncertainties for Electromed include, but are not limited to, component or raw material shortages, changes to lead times or significant price increases, changes to Medicare, Medicaid, or private insurance reimbursement policies; the duration, extent and severity of the COVID-19 pandemic, including its effects on Electromed’s business, supply chain, operations and employees as well as its impact on its customers and distribution channels and on economies and markets more generally; the competitive nature of Electromed’s market; changes to state and federal health care laws; changes affecting the medical device industry; Electromed’s ability to develop new sales channels for its products such as the homecare distributor channel; Electromed’s need to maintain regulatory compliance and to gain future regulatory approvals and clearances; new drug or pharmaceutical discoveries; general economic and business conditions; Electromed’s ability to renew its line of credit or obtain additional credit as necessary; Electromed’s ability to protect and expand its intellectual property portfolio; the risks associated with expansion into international markets, as well as other factors Electromed may describe from time to time in Electromed’s reports filed with the Securities and Exchange Commission (including Electromed’s most recent Annual Report on Form 10-K, as amended from time to time, and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K). Investors should not consider any list of such factors to be an exhaustive statement of all of the risks, uncertainties or potentially inaccurate assumptions investors should take into account when making investment decisions. Shareholders and other readers should not place undue reliance on “forward-looking statements,” as such statements speak only as of the date of this press release. Electromed undertakes no obligation to update them in light of new information or future events.

Brad Nagel, Chief Financial Officer
(952) 758-9299
investorrelations@electromed.com