Dentalcorp Closes $100 Million Bought Deal Treasury Offering and Secondary Offering of Subordinate Voting Shares

TORONTO--(BUSINESS WIRE)--Dec 2, 2024--

dentalcorp Holdings Ltd. (“ Dentalcorp ” or the “ Company ”) (TSX: DNTL), Canada’s largest and fastest growing network of dental practices, today announced the closing of its previously announced “bought deal” treasury offering and secondary offering of an aggregate of 10,530,000 subordinate voting shares of the Company (“ Subordinate Voting Shares ”) at a price of $9.50 (the “ Offering Price ”) per Subordinate Voting Share (the “ Offering ”). The Offering included a treasury offering of 5,265,000 Subordinate Voting Shares by the Company for gross proceeds to the Company of approximately $50 million and a secondary offering of an aggregate of 5,265,000 Subordinate Voting Shares by GR BCM2 #2 Acquisition Limited Partnership (the “ Rosenberg Selling Shareholder ”), an affiliate of OPTrust (“ OPTrust Selling Shareholder ”), LC8 DCC Investment Borrower, L.P. (“ L Catterton Investor ”) and DCC Holdings CR LP and DCC Holdings NR LP (together, the “ Imperial Selling Shareholders ” and, collectively with the Rosenberg Selling Shareholder, OPTrust Selling Shareholder and L Catterton Investor, the “ Selling Shareholders ”) for gross proceeds to the Selling Shareholders of approximately $50 million.

The Selling Shareholders have also granted the Underwriters (as defined herein) an over-allotment option (the “ Over-Allotment Option ”), exercisable in whole or in part on the same terms as the Offering for a period of 30 days from the date hereof, to purchase up to an additional 1,579,500 Shares, representing up to 15% of the size of the Offering, for additional gross proceeds to the Selling Shareholders of up to approximately $15 million.

The Offering was made through a syndicate of underwriters led by TD Securities Inc. (“ TD ”), RBC Capital Markets (“ RBC ”), and Canaccord Genuity Corp. (“ Canaccord ” and together with TD and RBC, the “ Lead Underwriters ”), and including Merrill Lynch Canada Inc., Desjardins Securities Inc., BMO Nesbitt Burns Inc., Stifel Nicolaus Canada Inc., ATB Securities Inc., and National Bank Financial Inc. (collectively with the Lead Underwriters, the “ Underwriters ”).

In connection with the Offering, each of the Company and the Selling Shareholders and certain of their affiliates, agreed to a lock-up period of 90 days, during which time they will be restricted from disposing of any securities of Dentalcorp without the prior consent of the Lead Underwriters, on behalf of the Underwriters, subject to certain exemptions.

The Offering was completed in Canada by way of a final short form prospectus dated November 27, 2024 (the “ Prospectus ”) and filed with the securities regulatory authorities in each of the provinces and territories of Canada, copies of which are available under the Company’s profile on the System for Electronic Data Analysis and Retrieval + (“ SEDAR+ ”) at www.sedarplus.com. The Subordinate Voting Shares were also offered in the United States by way of private placement to “qualified institutional buyers” in reliance upon the exemption from registration provided by Rule 144A under the U.S. Securities Act of 1933 (the “ U.S. Securities Act ”).

No securities regulatory authority has either approved or disapproved the contents of this press release. The Subordinate Voting Shares have not been, and will not be, registered under the U.S. Securities Act, or any state securities laws. Accordingly, the Subordinate Voting Shares may not be offered or sold within the United States unless registered under the U.S. Securities Act and applicable state securities laws or pursuant to exemptions from the registration requirements of the U.S. Securities Act and applicable state securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Subordinate Voting Shares in any jurisdiction in which such offer, solicitation or sale would be unlawful.

Required Early Warning Disclosure

This additional disclosure is being provided pursuant to National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues, which also requires a report to be filed by each of the Rosenberg Group (as defined below) and L Catterton Investor with the regulatory authorities in each jurisdiction in which the Company is a reporting issuer containing information with respect to the foregoing matters. This disclosure has been provided by the Rosenberg Group and L Catterton Investor, as applicable.

The Rosenberg Group

The Underwriters have agreed to purchase 479,287 Subordinate Voting Shares from the Rosenberg Selling Shareholder at the Offering Price for aggregate gross proceeds of $4,553,226.50 to the Rosenberg Selling Shareholder (623,073 Subordinate Voting Shares if the Over-Allotment Option is exercised in full for aggregate gross proceeds of $5,919,193.50 to the Rosenberg Selling Shareholder), in each case, before deducting the Underwriters’ commission in connection with the Offering.

Immediately prior to the closing of the Offering, Graham Rosenberg, Founder, Chief Executive Officer and Chairman of the Board of Directors of the Company, and entities owned and/or controlled, directly or indirectly, by him, including the Rosenberg Selling Shareholder (together, the “ RosenbergGroup ”), held 9,183,822 multiple voting shares of the Company (the “ Multiple Voting Shares ”) and 62,146 Subordinate Voting Shares representing an equity interest of approximately 4.8% and a voting interest of approximately 33.6%, in each case, on a non-diluted basis. The Subordinate Voting Shares held by the Rosenberg Group represented approximately 0.034% of the outstanding Subordinate Voting Shares and the Multiple Voting Shares represented 100.0% of the outstanding Multiple Voting Shares, in each case, on a non-diluted basis. Prior to the Offering, Mr. Rosenberg held 2,750,000 options to acquire Subordinate Voting Shares (each an “ Option ”), 121,977 restricted share units (“ RSUs ”) 134,268 performance voting shares (“ PSUs ”), each exercisable or settled for Subordinate Voting Shares.

Following closing of the Offering (assuming no exercise of the Over-Allotment Option), the Rosenberg Group holds 62,146 Subordinate Voting Shares and 8,704,535 Multiple Voting Shares representing an equity interest of approximately 4.5%, and a voting interest of approximately 31.7%, in each case, on a non-diluted basis. The Subordinate Voting Shares held by the Rosenberg Group represent 0.033% of the outstanding Subordinate Voting Shares and the Multiple Voting Shares held by the Rosenberg Group represent 100.0% of the outstanding Multiple Voting Shares. Mr. Rosenberg continues to hold 2,750,000 Options, 121,977 RSUs and 134,268 PSUs, each exercisable or settled for Subordinate Voting Shares, following closing of the Offering.

Each Multiple Voting Share represents ten votes on all matters upon which holders of shares in the capital of the Company are entitled to vote and is convertible into one Subordinate Voting Share at any time at the sole option of the holder.

The Rosenberg Group may, depending on market conditions, acquire additional Subordinate Voting Shares or dispose of Multiple Voting Shares or Subordinate Voting Shares in the future whether in transactions over the open market or through privately negotiated arrangements or otherwise, subject to a number of factors, including general market conditions and investment diversification.

A copy of the Rosenberg Group’s early warning report will be filed under the Company’s profile on SEDAR+ and further information and/or a copy of the Rosenberg Group’s early warning report may be obtained from the contacts below. The head office of the Rosenberg Selling Shareholder is 181 Bay Street, Suite 2600 Toronto, Ontario M5J 2T3.

The L Catterton Investor

Pursuant to the Offering, the L Catterton Investor disposed of 3,822,601 Subordinate Voting Shares to the Underwriters, representing approximately 2.1% of the issued and outstanding Subordinate Voting Shares as of the date of the Prospectus. Immediately prior to the Offering, the L Catterton Investor held 73,742,046 Subordinate Voting Shares, representing approximately 40.6% of the issued and outstanding subordinate voting shares as of the date of the Prospectus. Immediately after the Offering, the L Catterton Investor holds 69,919,445 Subordinate Voting Shares, representing approximately 37.3% of the issued and outstanding Subordinate Voting Shares. The Underwriters purchased the Subordinate Voting Shares from the L Catterton Investor at the Offering Price for aggregate gross proceeds of $36,314,709.50 to the L Catterton Investor, before deducting the Underwriters' commission in connection with the Offering.

The Subordinate Voting Shares were disposed of by the L Catterton Investor as a result of investment considerations including price, market conditions, availability of funds, evaluation of alternative investments and other factors. The L Catterton Investor may further dispose, hold, vote, trade, purchase or otherwise deal in the securities of the Company, in such manner as it deems advisable from time to time.

A copy of the L Catterton Investor’s early warning report will be filed under the Company’s profile on SEDAR+ and further information and/or a copy of the L Catterton Investor’s early warning report may be obtained from the contacts below. The L Catterton Investor’s head office is located at 599 West Putnam Avenue, Greenwich, CT 06830.

About Dentalcorp

Dentalcorp is Canada's largest and one of North America's fastest growing networks of dental practices, committed to advancing the overall well-being of Canadians by aiming to deliver the best clinical outcomes and unforgettable experiences. Dentalcorp acquires leading dental practices, uniting its network in a common goal: to be Canada's most trusted healthcare network. Leveraging its industry-leading technology, know-how and scale, Dentalcorp offers professionals the unique opportunity to retain their clinical autonomy while unlocking their potential for future growth. To learn more, visit dentalcorp.ca. Dentalcorp’s head office is located at 181 Bay Street, Suite 2600, Toronto, Ontario, M5J 2T3.

Source: Dentalcorp Holdings Ltd.

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CONTACT: For more information, please contact:Investor Relations

Nick Xiang

Senior Director, Corporate Finance

nick.xiang@dentalcorp.ca

(647) 220-4905Media

Sebastien Bouchard

Vice President, Corporate Communications

sebastien.bouchard@dentalcorp.ca

(437) 216-0733

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