SmileDirectClub to execute comprehensive recapitalization, files Chapter 11

SmileDirectClub announced a process to implement a comprehensive recapitalization transaction. The additional capital and stronger financial position from this recapitalization is intended to bolster the company’s balance sheet and fuel growth initiatives to allow SmileDirectClub to thrive as an international oral care leader for many years to come. SmileDirectClub will seek to recapitalize through a transaction where the company’s founders have committed to invest at least $20M to bolster the company’s balance sheet and to protect its near- and long-term financial health. Up to $60M of additional capital is available upon satisfaction of certain conditions, including the favorable conclusion of a marketing process. The founders’ investment in the company reflects their commitment to SmileDirectClub’s mission of democratizing access to premium oral care, as well their conviction in the success of the recently launched SmileMaker Platform and CarePlus growth initiatives. To effectuate the transaction, SmileDirectClub has voluntarily filed for protection under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Texas. During this restructuring process, SmileDirectClub intends to continue to provide affordable and accessible oral care to its customers without disruption. The additional liquidity the company received from its founders, coupled with its normal operating cash flows, is intended to ensure SmileDirectClub is able to continue meeting commitments to stakeholders without disruption throughout this process.