Close · Dental Practice Management

Indemnification for Dental Practice Management Independent Sponsors

Drafting Indemnification on dental practice management deals, with the structure protection and capital connectivity an independent sponsor actually needs.

EV range $10M to $130M EV EBITDA $2.5M to $22M Audience Buy-side / Sponsor
The deal context

An independent sponsor closing dental practice management transactions in the $10M to $130M EV range has a defined set of moves at the Indemnification stage. Most of them are not in a generic M&A textbook.

The typical dental practice management platform sits at $10M to $130M EV with EBITDA in the $2.5M to $22M range. The thesis runs on DSO buy-up under an MSO. Insurance mix dictates valuation. Read the PPO contracts before the EBITDA.

The moves

How Indemnification actually gets structured.

  1. Set general indemnity survival at 18 months, fundamental reps for the full statute of limitations.

  2. Build a basket at 0.5 percent of EV, with a deductible structure, not a tipping basket.

  3. Cap general indemnity at 10 percent of EV, with R&W insurance carrying the layer above.

  4. Carve out fraud, tax, and intentional breach from any cap.

  5. In dental practice management, layer in MSO model documented per state as part of the Indemnification workstream.

The common mistake

Negotiating caps and baskets without first reading the disclosure schedules. The schedules dictate the real exposure.

Jason's take
"Indemnification only matters when the deal goes wrong. Draft it as if it will."
Jason Powell · Indemnification
Capital after close

The deal is one thing. The capital that opens up after close is another.

After close, the call list for refinancing, recapitalization, and growth equity gets short and known. Jason carries that list.

MONTH 18
Senior refi
MONTH 24
Dividend recap
MONTH 36
Growth equity
YEAR 4–5
Strategic exit
ENGAGE THE PRACTICE

Indemnification for Dental Practice Management, on independent sponsor terms.

Independent sponsor counsel that already speaks fluent deal-by-deal economics, structures clean LPAs, and travels with capital markets relationships for what comes after close.