On November 19, 2019, Nuvectra Corporation began to implement a reduction in force plan that is expected to result in the termination of 89 of the Company's employees. The reduction in force is being implemented for cost-saving purposes as the Company proceeds through its previously-announced reorganization under Chapter 11 of the U.S. Bankruptcy Code (the “Chapter 11 Case”). The Company expects that the reduction in force will be completed within approximately 60 days after it was initiated. As a result of the reduction in force, the Company expects to generate pre-tax savings within sales and marketing, general and administrative and research and development expenses of approximately $15.9 million on an annualized basis. The Company expects to incur total non-recurring restructuring charges of approximately $0.2 million on a pre-tax basis for severance costs.

Due to the streamlined function of the Board of Directors of the Company (the “Board”) in the Chapter 11 Case, Jon Tremmel, Thomas Zelibor, Christopher Chavez and Jane Song each resigned from the Board shortly following the commencement of the Chapter 11 Case. The size of the Board is expected to remain at four members for the remainder of the Chapter 11 Case.