John L. Erb
NuwellisAbout John L. Erb
John L. Erb, age 76, is Interim President & Chief Executive Officer (appointed February 23, 2025), Chairman of the Board (since October 2012), and director (since September 2012) of Nuwellis, Inc. He holds a B.A. in business administration (finance) from California State University, Fullerton and has 50+ years in medical devices, including prior CEO roles and extensive public board experience . Company performance context: cumulative TSR for a $100 initial investment was $0.40 (2022), $0.47 (2023), and $0.03 (2024), with net loss of $14.5M (2022), $20.2M (2023), and $11.2M (2024), and net sales growth of 7.9% (2022), 3.8% (2023), and -1.4% (2024) . The Board met 27 times in 2024 and all directors attended at least 75% of meetings .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| CHF Solutions, Inc. (prior owner of Aquadex) | Executive Chairman (2007); CEO (2001–2006) | 2001–2007 | Led development, manufacturing, and distribution of devices for congestive heart failure; direct relevance to Aquadex . |
| NuAx, Inc. (Cardia Access, Inc.) | CEO | 2007–2020 | Developed new devices for heart disease; leadership in medtech innovation . |
| IntraTherapeutics, Inc. | President & CEO | 1997–2001 | Built peripheral vascular stent business; operational leadership . |
| Schneider (Pfizer division) | VP, Worldwide Operations | 1991–1997 | Managed multi-national device operations; scale and execution experience . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| CorRen Medical, Inc. | Executive Chairman | Current | Diagnostic and therapeutic products for cardiorenal syndrome . |
| Osprey Medical, Inc. (ASX) | Chairman (former) | Prior service | Public board leadership; heart imaging procedures focus . |
| IR Medtek | Chairman of the Board | Current | Private oncology products developer . |
| Miromatrix (Nasdaq: MIRO) | Director (former) | Prior service | Acquired by United Therapeutics in 2023 . |
| Lymphatica Medtech SA | Director (former) | 2023–2024 | Private Swiss medtech focused on lymphatic disease . |
| AcQumenn Medical Inc. | Director | Current | Startup diagnostic hemodynamic analytics . |
| SenoRx, CryoCath Technologies, Vascular Solutions | Director; Chair roles at Vascular Solutions | 2000s–2019 | Public company board tenure; compensation and governance committee leadership . |
Fixed Compensation
| Component | 2024 | Notes |
|---|---|---|
| Board cash fees (Erb) | $49,300 | Board and committee fees were temporarily reduced in 2024 to cut burn; restored Nov 1, 2024 . |
| Director equity grant policy | Eligible for annual stock options equal to 0.40% of common shares outstanding; monthly vest over 12 months | Board declined 2024 grants; eligible again at 2025 annual meeting . |
Performance Compensation
| Metric | Weighting | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|
| Annual revenue | Not disclosed | Not disclosed | Company reported net sales growth -1.4% in 2024 | No executive bonus payouts authorized due to liquidity constraints | N/A |
| REVERSE-HF clinical sites active | Not disclosed | Not disclosed | Not disclosed | No payouts authorized (2024) | N/A |
| Pediatric dialysis device milestones | Not disclosed | Not disclosed | Not disclosed | No payouts authorized (2024) | N/A |
- Notes: The PEO’s (CEO) bonus design has been based solely on corporate objectives; non-PEO NEO bonuses combine corporate and discretionary components historically. Erb’s 2025 interim CEO compensation and incentive metrics are not disclosed in the 2025 proxy .
Equity Ownership & Alignment
| Metric | Mar 25, 2025 | Jun 9, 2025 |
|---|---|---|
| Beneficially owned shares | 0 | 26,191 |
| Percent of class | 1.6% (based on total “Right to Acquire” aggregated) | 19.99% (130,154 shares outstanding; post 1-for-42 split) |
| Rights to acquire via stock options | 67 shares | 458 shares (subject to beneficial ownership limits) |
| Rights to acquire via preferred conversion | 68,961 shares (Series F Convertible Preferred; assumes full conversion and rounding) | 13,498 shares (Series F-1 Convertible Preferred; subject to beneficial ownership limits) |
| Hedging/Pledging | Hedging and monetization transactions prohibited by Insider Trading Compliance Policy; 10b5-1 pre-clearance and blackout controls in place | No pledging disclosure found |
Employment Terms
- Interim CEO appointment date: February 23, 2025 .
- Dual role structure: CEO and Chairman roles combined; Board’s view is combination is appropriate given management changes and active CEO search underway .
- Contracts/severance: No Erb-specific employment agreement, severance, or change-of-control terms disclosed in 2025 proxy; company maintains change-in-control agreements and equity plan acceleration mechanics for certain officers, but Erb’s specifics are not disclosed .
- Insider Trading Compliance: Quarterly blackouts, pre-clearance, Rule 10b5-1 cooling-off, and prohibition on hedging/monetization; special blackout periods allowed .
Board Governance
- Committees: Erb is not listed as a member of Audit, Compensation, or Nominating & Corporate Governance committees; he serves as Chairman of the Board .
- Committee composition: Audit (Chair Waller; members McCormick, McDonald), Compensation (Chair Georgiou; members Waller), Nominating & Corporate Governance (Chair McCormick; members McDonald, Costanzo) .
- Board independence: Majority independent; Erb is non-independent due to executive role; Board annually assesses independence and committee qualifications .
- Board meeting cadence/attendance: 27 Board meetings in 2024; directors ≥75% attendance; executive sessions held without management .
Director Compensation (Erb-specific)
| Year | Cash Fees | Option Awards | Outstanding Director Options (12/31/2024) |
|---|---|---|---|
| 2024 | $49,300 | $0 (Board declined annual grants) | 67 shares underlying outstanding options |
- Policy detail: Annual cash $45,000; Chair add’l $15,000; Lead Independent Director add’l $10,000; Committee chairs/members paid per committee (Audit: $15,000/$7,500; Compensation/Nominating: $10,000/$5,000) .
- Equity vesting under director policy: 1/12 monthly vest over one year when granted .
Compensation Structure Analysis
- Mix shift and austerity: 2024 saw reduced cash compensation for senior management and Board fees to cut burn ~40%; equity grants to directors skipped in 2024; restoration of Board fees and executive salaries effective November 1, 2024 .
- Bonus discipline: Despite assessed objectives, no executive cash bonuses were authorized for 2024 due to liquidity, indicating pay-for-performance tempered by capital constraints .
- Consultant usage: Compensation Committee used FW Cook in 2022 for 2023 benchmarking (16-company peer group); no consultant retained in 2024 .
Performance & Track Record
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Cumulative TSR value of $100 investment | $0.40 | $0.47 | $0.03 |
| Net loss ($) | $14,525,000 | $20,209,000 | $11,165,000 |
| Net sales growth (%) | 7.9% | 3.8% | -1.4% |
- Governance risk context: Company confronted Nasdaq compliance issues, multiple reverse splits (1-for-35 on June 27, 2024; 1-for-42 on July 3, 2025), authorized share increase proposals, and warrant-related dilution mechanics—material for trading dynamics and equity incentives .
Risk Indicators & Red Flags
- Dual-role governance: CEO + Chairman combined; Board sees benefits given transition, but typical investor concern on independence remains .
- Nasdaq listing pressure: Mandatory panel monitor; risk of delisting and penny stock consequences; reverse splits within two years constrain compliance periods—heightened volatility and financing risk .
- Dilution vectors: Significant warrants and preferred conversions outstanding; special meeting sought stockholder approval for warrant exercises and authorized share increase—potential dilution and selling pressure overhang .
- Hedging prohibited: Reduces misalignment risk; no disclosure of pledging—monitor for any future pledging updates .
Equity Ownership & Alignment Implications
- Skin-in-the-game: Erb’s beneficial stake was 19.99% as of June 9, 2025, a high alignment signal; additional options and preferred convertibles exist but are subject to beneficial ownership limits, moderating immediate selling pressure .
- Vesting schedules: Director equity, when granted, vests monthly over 12 months; plan-level option vesting typically 25% at year one, then monthly over 36 months for awards under employee plans .
Employment Terms (Severance & Change-of-Control Economics)
- Not disclosed for Erb as interim CEO in current proxy filings; company’s standard change-in-control agreements provide 12 months’ salary, prior-year bonus, 12 months healthcare, and equity acceleration for covered officers under double-trigger circumstances—Erb’s inclusion not disclosed .
Investment Implications
- Alignment: A ~20% beneficial stake supports pay-for-performance alignment; hedging ban reduces adverse alignment behaviors .
- Governance and liquidity risks: Combined CEO/Chair role amid a CEO search, active Nasdaq compliance monitoring, reverse split history, and ongoing authorization proposals signal elevated governance and capital market risk—likely higher stock volatility and potential dilution from warrants and preferred conversions .
- Compensation clarity: Limited disclosure on 2025 interim CEO package creates uncertainty on incentive structures; 2024 restraint on bonuses and director equity suggests cash conservation over retention incentives—monitor for updated employment terms, equity grants, and any 10b5-1 plans .
- Trading signals: Warrant exercise approvals, reset features, and reverse split dynamics can catalyze short-term price moves and liquidity events; panel monitoring period increases delisting event risk if equity thresholds slip—important for positioning and risk management around corporate actions .