- Significant participation from existing shareholders and
accredited healthcare investors, which the company believes
underscores confidence in its strategy
- Financing supports execution of long-term growth initiatives
focused on high-margin, scalable recurring revenues across B2B
(Business-to-Business) and pharma channels
NEW
YORK, Jan. 21, 2025 /PRNewswire/
-- 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, 2025.
"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.
Transaction Details
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.
In addition, the 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.
About DarioHealth Corp.
DarioHealth 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.
Dario's 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.
Dario 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.
Cautionary Note Regarding Forward-Looking Statements
This 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 law.
DarioHealth Corporate Contact
Mary Mooney
VP Marketing
mary@dariohealth.com
+1-312-593-4280
DarioHealth Investor Relations Contact
Kat
Parrella
Investor Relations Manager
kat@dariohealth.com
+315-378-6922
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SOURCE DarioHealth Corp.
