Full Press Release Details
DarioHealth Announces
$25.6M Private Placement Positioning the Company to Execute on
Strategy Aiming to Reach Operational Cash Flow Positive Run Rate by the
NEW YORK, January 21, 2025 - DarioHealth
Corp. (Nasdaq: DRIO) ("Dario" or the "Company"), a prominent leader in the global digital health industry, announced
today the successful closing of a $25.6 million private placement of convertible preferred stock, priced in accordance with Nasdaq
market rules. The majority of the funds were secured from existing shareholders, with the remainder contributed by a network of leading
accredited healthcare investors and executives from the healthcare sector.
The result of this offering is expected to extend
Dario's cash runway and bolster its financial position enabling the Company to continue executing its current strategic plan which includes
achieving an operational cash flow positive run rate by the end of 2025 while continuing to build high-margin, scalable recurring revenues
across B2B and pharma channels. As a result, the Company's proforma cash balance, inclusive of the proceeds from the private placement,
is $40.6 million as of the end of the third quarter of 2024. The private placement closed on December 18, 2024, and January 14,
"Through the end of 2024, we demonstrated
the strong execution of our multi-year strategic plan to become a profitable provider of comprehensive chronic care management solutions.
Today, we are happy to announce the completion of a major milestone in this strategic plan that we believe can secure our projected operational
cash flow positive run rate by the end of 2025. I believe that the ongoing cost optimization efforts following the Twill merger, coupled
with steady revenue growth across multiple channels, have set us on a path to success. We are particularly pleased that more than half
of the newly issued convertible preferred shares were purchased by our existing shareholders, which we believe is a strong vote of confidence
in our strategy and performance. The remaining funds came from prominent accredited healthcare investors that we are thrilled to have
onboard as shareholders as well," commented Erez Raphael, Chief Executive Officer of Dario.
"I believe that this financing will empower
us to execute on our long-term growth strategy, which is centered on high-margin, scalable recurring revenues across our B2B and pharma
channels. I believe that these steps will enable us to maintain our growth trajectory and strengthen our position in the digital health
market," Commented Steven Nelson, Chief Commercial Officer of Dario.
Pursuant to the equity
offering, the Company issued shares of newly designated convertible preferred stock (the "Preferred Stock"). 18,805 shares of
Preferred Stock were sold at $1,000 per share, with a conversion price of $0.73 and 6,800 shares of Preferred Stock
were sold at $1,000 per share, with a conversion price of $0.83.
The Preferred Stock provides
that upon conversion to common stock, holders will be entitled to receive a 10% dividend payable in common stock each quarter for the
first four quarters, for an aggregate stock dividend of up to 40%. Each share of Preferred Stock will automatically convert into shares
of the Company's common stock at the applicable conversion price upon the 12-month anniversary of the respective closings. The conversion
of the Preferred Stock is subject to stockholder approval.
Company and certain purchasers in the offering that are holders of the Company's Series B Preferred Stock and Series C
Preferred Stock, executed lock up agreements (the "Lock Up Agreement"), pursuant to which the Company agreed to issue,
subject to stockholder approval, up to forty percent (40%) of the shares of Common Stock
underlying the Series B Preferred Stock and the Series C Preferred Stock held by such purchaser, including dividend shares of Common
Stock due upon conversion of these shares into shares of Common Stock, over the course of twelve (12) months (the "Additional
Shares"). Each holder shall be entitled to receive 10% of the Additional Shares for each three (3) month period each holder
agrees not to transfer or otherwise sell (subject to certain limitations) the shares of Common Stock issuable upon conversion of the
Series B Preferred Stock and Series C Preferred Stock and the dividend shares of Common Stock due upon conversion.
The securities described
herein have not been registered under the Securities Act of 1933, as amended, and may not be sold in the United States absent
registration or an applicable exemption from the registration requirements.
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 these securities in any state or
other jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities
laws of any such state or other jurisdiction.
Corp. (Nasdaq: DRIO) is a leading digital health company revolutionizing how people with chronic conditions manage their health through
a user-centric, multi-chronic condition digital therapeutics platform. Dario's platform and suite of solutions deliver personalized and
dynamic interventions driven by data analytics and one-on-one coaching for diabetes, hypertension, weight management, musculoskeletal
pain and behavioral health.
user-centric platform offers people continuous and customized care for their health, disrupting the traditional episodic approach to healthcare.
This approach empowers people to holistically adapt their lifestyles for sustainable behavior change, driving exceptional user satisfaction,
retention and results and making the right thing to do the easy thing to do.
provides its highly user-rated solutions globally to health plans and other payers, self-insured employers, providers of care and consumers.
To learn more about Dario and its digital health solutions, or for more information, visit http://dariohealth.com.
Note Regarding Forward-Looking Statements
news release and the statements of representatives and partners of DarioHealth Corp. related thereto contain or may contain
forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not
statements of historical fact may be deemed to be forward-looking statements. For example, the Company is using forward-looking
statements in this press release when it discusses the Company's anticipated cash runway following the private placement, the
belief that the result of the offering is a major milestone in its strategic plan and that it believes it can secure its
projected operational cash flow positive run rate by the end of 2025, and the belief that the financing
will empower it to execute on its long-term growth strategy, which is centered on high-margin, scalable recurring revenues
across our B2B and pharma channels, which will enable it to maintain its growth trajectory and strengthen its position in the
digital health market. Without limiting the generality of the foregoing, words such as
"plan," "project," "potential," "seek," "may," "will,"
"expect," "believe," "anticipate," "intend," "could," "estimate" or
"continue" are intended to identify forward-looking statements. Readers are cautioned that certain important factors may
affect the Company's actual results and could cause such results to differ materially from any forward-looking statements that may
be made in this news release. Factors that may affect the Company's results include, but are not limited to, regulatory approvals,
product demand, market acceptance, impact of competitive products and prices, product development, commercialization or
technological difficulties, the success or failure of negotiations and trade, legal, social and economic risks, and the risks
associated with the adequacy of existing cash resources. Additional factors that could cause or contribute to differences between
the Company's actual results and forward-looking statements include, but are not limited to, those risks discussed in the
Company's filings with the U.S. Securities and Exchange Commission. Readers are cautioned that actual results (including, without
limitation, the timing for and results of the Company's commercial and regulatory plans for Dario as described herein) may
differ significantly from those set forth in the forward-looking statements. The Company undertakes no obligation to publicly update
any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable
DarioHealth Corporate Contact
DarioHealth Investor Relations Contact
Investor Relations Manager