DarioHealth Announces $28.6 Million Private Placement

News provided by

Jul 31, 2020, 11:15 ET

NEW YORK, July 31, 2020 /PRNewswire/ -- DarioHealth Corp. (Nasdaq: DRIO), a pioneer in the global digital therapeutics market, today announced that it closed a private placement transaction with accredited investors, including healthcare funds and institutions from the U.S. and Israel. The company received aggregate gross proceeds of approximately $28.6 million, before deducting placement agent fees and other offering expenses.

Capital from this financing combined with existing balance sheet cash positions the company in its best financial state since its founding. It is expected that these resources will be used to fund Dario's long term strategic operating plan, as it expands its focus from the direct-to-consumer channel to what it believes is the larger, more lucrative business-to-business-to-consumer channel, which is characterized by lower customer acquisition costs, higher margins and recurring revenues. In that regard, the primary use of proceeds will be to further fund the build out of the company's commercial infrastructure to assist it in securing contracts with health plans, self-insured employers and providers and to penetrate their vast member, employee and patient populations.

The company's largest existing shareholder, Nantahala Capital Management, LLC (on behalf of client funds and accounts), was joined by new investors including funds managed by Manchester Management Company LLC, Soleus Capital Management L.P. as well as leading Israeli institutional investors such as Phoenix insurance, Mor provident fund, Psagot investment house.

The company sold 2,969,266 shares of common stock and, to certain investors in lieu thereof, pre-funded warrants to purchase 824,689 shares of common stock at an exercise price of $0.0001 per share. The purchase price per share was equal to $7.47, or the "Minimum Price," pursuant to Nasdaq Rule 5635(d) as of July 28, 2020, and the purchase price of each pre-funded warrant was $7.4699. The company also sold 31,486 shares of common stock at a price per share equal to $7.94, or the "Minimum Price," pursuant to Nasdaq Rule 5635(d) as of July 30, 2020, The transaction closed on July 31, 2020.

"We are pleased to have the confidence of our largest shareholder and several new highly regarded healthcare investors as we expand our commercial to manage existing and anticipated near-term agreements with health care payers," said Erez Raphael, chief executive officer of Dario. "The adoption rate of digital therapeutics has been accelerated by the current pandemic. Dario's efficacious, value-oriented solution is well-positioned to compete in this largely untapped U.S. market."

SternAegis Ventures acted as the exclusive placement agent for this offering.

Rosario Capital acted as financial advisor in Israel.

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.

About DarioHealth Corp.

DarioHealth Corp. (Nasdaq: DRIO) is a leading, global digital therapeutics company revolutionizing the way people with chronic conditions manage their health. By delivering evidence-based interventions that are driven by data, high-quality software and coaching, we empower individuals to make healthy adjustments to their daily lifestyle choices to improve their overall health. Our cross-functional team operates at the intersection of life sciences, behavioral science and software technology to deliver highly engaging therapeutic interventions. Dario is one of the highest-rated diabetes solutions in the market, and its user-centric MyDario™ mobile app is loved by tens of thousands of consumers around the globe. DarioHealth is rapidly moving into new chronic conditions and geographic markets, using a performance-based approach to improve the health of users managing chronic disease. To learn more about DarioHealth and its digital health solutions, visit http://dariohealth.com.

About SternAegis Ventures

SternAegis Ventures is the management team within Aegis Capital Corp. that is responsible for venture capital and private equity financing. www.sternaegis.com

Cautionary Note Regarding Forward-Looking Statements

This news release and the statements of representatives and partners of DarioHealth Corp. (the "Company") 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. 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. For example, the Company is using forward-looking statements in this press release when it discusses its intended use of proceeds, its intention to expands its focus from the direct-to-consumer channel to what it believes is the larger, more lucrative business-to-business-to-consumer channel, which is characterized by lower customer acquisition costs, higher margins and recurring revenues, its belief that the adoption rate of digital therapeutics has been accelerated by the current pandemic and that its efficacious, value-oriented solution is well-positioned to compete in this largely untapped U.S. market. 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™) 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 law.

Logo - https://mma.prnewswire.com/media/544126/DarioHealth_Logo.jpg

DarioHealth Corporate Contact:
Claudia Levi
Content & Communications Manager
[email protected]
+1-347-767-4220

Media Inquiries:
Investor Relations Contact:
Chuck Padala
[email protected]
+1-646-627-8390

SOURCE DarioHealth Corp.