DarioHealth collects about $21.3 mln in private placement

New York City-based DarioHealth, a digital therapeutics company, has raised about $21.3 million in a private placement.

New York City-based DarioHealth, a digital therapeutics company, has raised about $21.3 million in a private placement. SternAegis Ventures was the placement agent.

PRESS RELEASE

NEW YORK, Dec. 20, 2019 /PRNewswire/ — DarioHealth Corp. (Nasdaq: DRIO) (“DarioHealth” or the “Company”), a pioneer in the global digital therapeutics market, announced today that it has closed on a private placement of convertible preferred stock to institutional and private investors. The Company received aggregate gross proceeds of approximately $21.3 million, before deducting placement agent fees and other offering expenses payable by the Company.

The capital raised from both existing and new investors will fund DarioHealth’s strategic plan, which includes accelerating the Company’s initiatives in the Business-to-Business (B2B) channel while continuing to support our direct-to-consumer (D2C) sales and marketing initiatives. The proceeds will be primarily used for the expansion of DarioHealth’s U.S. sales and marketing infrastructure that is expected to result in additional B2B contracts while, at the same time, allowing further penetration of accounts already under contract. In addition, the Company plans to use the funding to increase the breadth of chronic conditions addressed by DarioHealth’s digital therapeutics platform, which delivers personalized, evidence-based interventions to users that are driven by precision data analytics, high quality software and one-on-one coaching. This includes supporting the ongoing launch of the digital therapeutics (DTx) platform and expansion into other large chronic disease market opportunities.

“We are excited to complete this transformative financing, which exceeded our initial funding expectations,” said Erez Raphael, CEO of DarioHealth. “As we continue our strategic push into the B2B channel, we believe this funding will enable us to expand our relationships with payers, employers, providers, and distributors on a much larger scale.”

As a part of the private placement offering, the Company issued a total of 21,375 shares of newly designated Convertible Preferred Stock (the “Preferred Stock”). Each share of Preferred Stock was sold at $1,000 per share. The Preferred Stock are convertible into shares of common stock, at the option of the holder, subject to certain beneficial ownership limitations, and are mandatorily convertible three years after the respective issuance dates or upon the consent of a majority of the holders of each respective class of Preferred Stock. The Preferred Stock also provides for holders of Preferred Stock to receive dividends payable in common stock on the one, two, and three-year anniversaries of their issuance. Other material terms of the Preferred Stock are described in the Company’s Current Reports on Form 8-K filings made with the Securities and Exchange Commission on December 3, 2019, December 6, 2019 and December 19, 2019.

“We believe that the strong investor response to this private placement is a testament to DarioHealth’s unique positioning and business strategy as well as the global demand to invest in the growth of digital health therapies,” added Adam Stern, CEO of SternAegis Ventures and Head of Private Equity Banking of Aegis Capital.

SternAegis Ventures acted as the exclusive placement agent for this offering. Participants in the offering included existing investors, new investors and affiliates of the placement agent.
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, please go to: http://mydario.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