Surgalign Holdings, Inc. Announces Pricing of $20 Million Public Offering

Rhea-AI Summary

Surgalign Holdings, Inc. (NASDAQ: SRGA) announced a public offering of 43,478,264 shares of common stock at an effective price of $0.46 per share, along with warrants to purchase 32,608,698 additional shares. The offering aims to raise approximately $20 million, intended for working capital and the development of digital health solutions. The deal is expected to close around February 15, 2022, pending customary conditions. An underwriter option allows for an additional purchase of shares and warrants. H.C. Wainwright & Co. serves as the book-running manager.

Positive

• The offering aims to raise approximately $20 million for working capital and digital health development.
• Surgalign has granted underwriters an option to purchase additional shares, indicating strong market interest.

Negative

• The public offering may dilute current shareholder equity.
• The effective price per share is below market value, potentially raising concerns among investors.

DEERFIELD, Ill., Feb. 10, 2022 (GLOBE NEWSWIRE) -- Surgalign Holdings, Inc. (NASDAQ: SRGA) (“Surgalign”), a global medical technology company focused on elevating the standard of care by driving the evolution of digital health, today announced the pricing of its previously announced underwritten public offering of 43,478,264 shares of its common stock (or pre-funded warrants to purchase common stock in lieu thereof) and warrants to purchase up to an aggregate of 32,608,698 shares of common stock at a combined effective public offering price of $0.46 per share of common stock (or pre-funded warrant) and accompanying 0.75 of a warrant. Each whole warrant is exercisable immediately at an exercise price of $0.60 per share and will expire five years following the date of issuance. All of the securities being sold in the offering are being offered by Surgalign. The offering is expected to close on or about February 15, 2022, subject to satisfaction of customary closing conditions.

In addition, Surgalign has granted the underwriter a 30-day option to purchase up to an additional 6,521,736 shares of common stock and/or warrants to purchase up to an additional 4,891,302 shares of common stock at the public offering price, less the underwriting discounts and commissions.

H.C. Wainwright & Co. is acting as the sole book-running manager for this offering.

The gross proceeds from the offering to Surgalign, before deducting underwriting discounts and commissions and other offering expenses, excluding any proceeds that may be received upon the exercise of the option to purchase additional securities and any exercise of the warrants to purchase common stock, are expected to be approximately $20 million. Surgalign intends to use the net proceeds from the offering for working capital and general corporate purposes, including preparation for approval, utilization and ongoing development of its digital health offerings.

The offering is being made only by means of a prospectus supplement and accompanying base prospectus. Surgalign has filed a shelf registration on Form S-3 (File No. 333-259893) (including a base prospectus) with the U.S. Securities and Exchange Commission (“SEC”), which was declared effective on December 28, 2021. A preliminary prospectus supplement and accompanying base prospectus relating to the offering have been filed with the SEC and are available on the SEC’s website, located at www.sec.gov. Electronic copies of the final prospectus supplement and the accompanying base prospectus for the offering may be obtained, when available, by contacting H.C. Wainwright & Co., LLC, at 430 Park Ave., New York, New York 10022, by telephone at (212) 856-5711, or by email at placements@hcwco.com. Prospective investors should read the prospectus supplement and accompanying base prospectus and other documents Surgalign has filed or will file with the SEC for more complete information about Surgalign and the public offering.

This press release does not constitute an offer to sell or a solicitation of an offer to buy the securities in this offering, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.

About Surgalign Holdings, Inc.
Surgalign Holdings, Inc. is a global medical technology company committed to the promise of digital health to drive transformation across the surgical landscape. Uniquely aligned and resourced to advance the standard of care, the company is building technologies physicians and other health providers will look to for what is truly possible for their patients. Surgalign is focused on developing solutions that predictably deliver superior clinical and economic outcomes. Surgalign markets products throughout the United States and in more than 50 countries worldwide through an expanding network of top independent distributors. Surgalign is headquartered in Deerfield, IL, with commercial, innovation and design centers in San Diego, CA, Warsaw and Poznan, Poland and Wurmlingen, Germany.

Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements related to the completion of the public offering, the satisfaction of customary closing conditions related to the public offering and the intended use of proceeds from the public offering. These forward-looking statements are based on management’s current expectations, estimates and projections about our industry, our management’s beliefs and certain assumptions made by our management. Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” variations of such words and similar expressions are intended to identify such forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to various risks and uncertainties, including market and other conditions and the risks identified in Surgalign’s most recent Annual Report on Form 10-K and other filings with the SEC. Our actual results may differ materially from the anticipated results reflected in these forward-looking statements. Copies of Surgalign’s SEC filings may be obtained without charge by visiting Surgalign’s website at www.surgalign.com or the SEC’s website at www.sec.gov. We undertake no obligation to update these forward-looking statements except as may be required by law.

Investor Relations Contact:
Mike Vallie
T: 443-213-0499
IR@surgalign.com

FAQ

What is the purpose of Surgalign's public offering?

Surgalign intends to use the net proceeds for working capital and developing its digital health offerings.

How many shares is Surgalign offering?

Surgalign is offering 43,478,264 shares of common stock in this public offering.

When is the expected closing date for Surgalign's offering?

The expected closing date for the offering is around February 15, 2022.

What is the effective public offering price for Surgalign's shares?

The effective public offering price is $0.46 per share of common stock or pre-funded warrant.

Who is managing Surgalign's public offering?

H.C. Wainwright & Co. is acting as the sole book-running manager for the offering.