DarioHealth Corp. (NasdaqCM:DRIO) acquired Twill, Inc. for $34.4 million on February 15, 2024. Under the terms of the acquisition, Dario paid $10 million of cash and agreed to issue approximately 10 million shares of common stock in the form of pre-funded warrants for the benefit of Twill's debt holders and equity holders the warrants will vest in four equal amounts at 270 days, 360 days, 540 days and 720 days, post deal closing. Concurrent with the acquisition, Dario priced a $22.4 million private placement of convertible preferred stock, priced at the market under Nasdaq rules, with participation from investors from both companies. The transaction creates immediate scale, with three of the top eight national health plans, multiple Fortune 100 employers and several major pharmaceutical companies as customers. Twill employees will be integrated into DarioHealth. Tomer Ben-Kiki, will join Dario's leadership team as Chief Operating Officer and Twill co-founder Ofer Leidner, will join as an advisor to the commercial team to support company growth.

Respective Board of Directors of DarioHealth and Twill, Inc. approved the deal unanimously. The Shareholders of Twill, Inc. have duly and validly approved this Agreement. Dario intends to use the net proceeds from the offering for general corporate purposes. The acquisition is immediately accretive to revenue and gross margins and expected to accelerate path to profitability. The acquisition of Twill is expected to nearly double pro forma 2023 revenue, and gross margins are expected to reach approximately 80-85% by 2025 and the acquisition is expected to accelerate market penetration and drive greater sales opportunities as a direct result of the breadth of combined solutions, with an opportunity to increase revenue per customer through cross-selling into both companies' existing customer bases, which has almost no overlap.

Stifel acted as financial advisor to Dario on the acquisition, and Ben Armour of Sullivan & Worcester LLP acted as legal counsel to Dario in connection with the acquisition and the financing. TD Cowen acted as financial advisor, and Michael J. Lerner and Annie Nazarian Davydov of Lowenstein Sandler LLP acted as legal counsel, to Twill in connection with the transaction.

DarioHealth Corp. (NasdaqCM:DRIO) completed the acquisition of Twill, Inc. on February 15, 2024.