The PR's Good News:
• DRIO closed a $4.2 million private placement offering.
- Private placements can be a key source of capital for businesses, especially small or start-up companies.
• DRIO did not use a placement agent for this financing.
- That means DRIO did not need to hire an individual or firm for the purpose of finding people who are interested in investing in the company. So apparently finding investors wasn't a time consuming hassle for them. And I guess we now know why DRIO had missed that last investor microcap conference, they already had investors lined up!
• DRIO expects to secure net proceeds of approximately $4.1 million from this financing.
- That would technically be $300,000 more from their first February 2014 private placement closing, which raised $3.8 million in net proceeds.
• DRIO intends to use the net proceeds from the offering to ramp up 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.
- I fully expect them to put this new raised monies right back into the expanding operations of the company, just like they did with their previous, first raised proceeds to start the roll out of Dario's soft launch in European markets.
• The lead investor in the offering is Dicilyon Consulting and Investment Ltd., an affiliate of Israeli investor David Edery, which has invested $3.0 million in the financing. The remaining investors were all institutional or accredited investors.
- Of the $4.2 million private placement offering, $3.0 million of it, the vast majority, is/was invested by one single investor, leaving only $1,200,000 million that was invested by institutional or accredited investors.
• As of the closing, LabStyle's board has appointed Mr. Rami Yehudiha, the Founder and Chief Executive Officer of LEAD, a top 10 Israeli advertising and marketing agency. Mr. Yehudiha is an appointee of Mr. Edery.
- Already Mr. David Edery is making moves with/for his investment. LabStyle is now and has been stacked with top level businesspeople of/in Israel.
• Commenting on the financing Mr. Edery stated, "After thorough due diligence, we are very pleased to make this fundamental and strategic investment in LabStyle. The Dario Diabetes Management Solution is a novel and cutting edge mobile health software and medical device platform that represents a significant evolution in the diabetes management market. I believe that LabStyle has the right product at the right time to be an important player in digital health market. LabStyle's prospects are driven by significant worldwide market potential, current and pending regulatory approvals, patented intellectual property and the company's strong team of professionals. We are optimistic that this investment will help meet LabStyle's near term requirements."
- This majority investor, David Edery, did thorough due diligence and is/was pleased to invest $3.0 million dollars of his money into DRIO as a fundamental and strategic investment. He clearly sees and knows the incredible potential Dario has in the worldwide diabetes management market.
• In order to accommodate the number of shares of common stock underlying the preferred stock and warrants issued in the financing, LabStyle announced that it will, under authority previously granted by the company's stockholders, effect a 5 for 1 reverse stock split of its outstanding common stock. This stock split will implemented within two weeks, and the company will make a further announcement regarding the exact timing for the stock split.
- This is not a detrimental stock split. And we have a completely open and transparent company notifying shareholders in advance with a timetable of implementation.
• "FDA" is/was dropped 3 times within this one PR.
- It's always good to get an "FDA" drop, but three, I love it! :)
