Israel’s LabStyle Innovations, the maker of the Dario smart meter for diabetics, announced that it raised $1.6 million in a private placement offering consisting of shares of common stock and warrants.
LabStyle intends to use the net proceeds from the offering to fund continuing manufacturing and sales efforts in existing and new markets and to continue ongoing regulatory work associated with its pending FDA 510(k) application for Dario, as well as for general working capital.
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The investors were all institutional or accredited investors.
LabStyle issued 9, 064, 222 shares of common stock at $0.18 per share, representing a 5.9% premium to the closing price of LabStyle’s publicly traded common stock on February 24, 2015. Such price is not subject to any future adjustments.
Investors were also issued two warrants exercisable for an aggregate of 4, 532, 114 shares of common stock (or 50% warrant coverage, or 25% coverage for each warrant) as follows: one warrant carries an exercise price per share $0.24 an expires on the nine month anniversary of the closing, and the second warrant carries an exercise price per share $0.30 and expires on the 36-month anniversary of the closing.
Erez Raphael, president and chief executive officer of LabStyle, stated, “We are very pleased to have accomplished this financing, as it allows us to continue our efforts to introduce the world to our revolutionary Dario diabetes management platform that we believe creates the potential to improve diabetic patient care. Our 2014 soft launch provided us with excellent feedback from patients, and we are now confident that Dario has the potential to make a real difference in lives of diabetic patients and help them stabilize and improve their medical condition.”
Zvi Ben-David, chief financial officer of LabStyle, who participated in this round as an investor, stated, “This financing helps us to continue our regulatory and marketing efforts during 2015. In addition, the structure of the 9 month warrant also provides us with the potential of some additional funding during this year. In the near term, we will use this funding to continue to improve operating efficiencies and cost reductions as we seek to continue or sales efforts with Dario and complete our regulatory clearance efforts with FDA.”
LabStyle separately announced that Dr. Peter Kash, who was appointed as member of the company’s board of directors in November 2014, will be resigning from the board due to increased schedule demands from his other commitments and will join LabStyle’s advisory board, were he will continue to contribute his extensive knowledge and experience to LabStyle.
