Surgalign Holdings, Inc., the successor company to RTI Surgical, led by industry veteran Terry Rich who led Surgalign into the world of artificial intelligence, augmented reality and surgical robotics, has initiated bankruptcy proceedings.
In mid-June, Surgalign Holdings, Inc. and seven affiliated debtors filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas.
The affiliated debtors include the following: Surgalign Spine Technologies, Inc.; Pioneer Surgical Technology NewCo Inc.; Spinal Transition and Professional Services LLC; Andi’s Belmarall, LCC; Fourth Dimension Spine, LLC; Holo Surgical Inc.; and HoloSurgical Technology Inc.
Surgalign Holdings has also entered into an asset purchase agreement with Xtant Medical Holdings, Inc. to “sell substantially all of its [Surgalign Holdings] U.S. hardware and biomaterials assets and the equity interests in non-Debtor entities related to the Debtors’ hardware business outside of the U.S.” for $5 million. The sale will occur through the Chapter 11 proceedings.
In conjunction with the bankruptcy proceedings, Surgalign Holdings has also filed a motion “seeking authorization to pursue an auction and sale process under section 363 of the U.S. Bankruptcy Code pursuant to which Xtant will be designated as the stalking horse bidder.” A stalking horse bidder is an initial bidder on the assets of a bankrupt company. The planned sale process will include other assets of Surgalign Holdings that are not part of the asset purchase agreement.
There are a number of motions currently pending with the Bankruptcy Court. These motions, according to the company, are to “ensure the continuation of normal operations during this process.” Surgalign Holdings “believes that it has sufficient liquidity to conduct its businesses in an uninterrupted manner and fund the chapter 11 proceedings.”
Over the years, Surgalign CEO Terry Rich and his team have built a significant portfolio of advanced AI, navigation and imaging technologies which culminated in winning the 2022 Best Technology award for the world’s first artificial intelligence (AI) driven augmented reality (AR) guidance system for spine, called the HOLO Portal™. For OTW’s complete coverage of the technology, see “Best New Spine Technologies for 2022.”
