CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS AND SUMMARY RISK FACTORS
This Annual Report on Form 10-K, or the Annual Report, contains “forward-looking statements,” which includes information relating to future events, future financial performance, financial projections, strategies, expectations, competitive environment and regulation. Words such as “may,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” and similar expressions, as well as statements in future tense, identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and may not be accurate indications of when such performance or results will be achieved. Forward-looking statements are based on information we have when those statements are made or management’s good faith belief as of that time with respect to future events, and are subject to significant risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to:
| ● | our current and future capital requirements and our ability to satisfy our capital needs through financing transactions or otherwise; |
| ● | our ability to meet the requirements of our existing debt facility; |
| ● | our product launches and market penetration plans; |
| ● | the execution of agreements with various providers for our solution; |
| ● | our ability to maintain our relationships with key partners, including Sanofi U.S. Services Inc. (“Sanofi”); |
| ● | our ability to complete required clinical trials of our product and obtain clearance or approval from the United States Food and Drug Administration (the “FDA”), or other regulatory agencies in different jurisdictions; |
| ● | our ability to maintain or protect the validity of our U.S. and other patents and other intellectual property; |
| ● | our ability to retain key executive members; |
| ● | our ability to internally develop new inventions and intellectual property; |
| ● | general market, political and economic conditions in the countries in which we operate, including those related to recent unrest and actual or potential armed conflict in Israel and other parts of the Middle East, such as the recent attack by Hamas and other terrorist organizations from the Gaza Strip and Israel’s war against them; |
| ● | interpretations of current laws and the passages of future laws; and |
| ● | acceptance of our business model by investors. |
The foregoing does not represent an exhaustive list of matters that may be covered by the forward-looking statements contained herein or risk factors that we are faced with that may cause our actual results to differ from those anticipated in our forward-looking statements. Please see “Risk Factors” for additional risks that could adversely impact our business and financial performance.
Moreover, new risks regularly emerge and it is not possible for our management to predict or articulate all the risks we face, nor can we assess the impact of all risks on our business or the extent to which any risk, or combination of risks, may cause actual results to differ from those contained in any forward-looking statements. All forward-looking statements included in this Annual Report are based on information available to us on the date of this Annual Report. Except to the extent required by applicable laws or rules, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and
oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained above and throughout this Annual Report.
When used in this Annual Report, the terms “Dario,” “DarioHealth,” “the Company,” “we,” “our,” and “us” refer to DarioHealth Corp., a Delaware corporation and our subsidiary LabStyle Innovation Ltd., an Israeli company, PsyInnovations Inc., a Delaware company, Twill, Inc., a Delaware company, and DarioHealth India Services Pvt. Ltd., an Indian company. “Dario” is registered as a trademark in the United States, Israel, China, Canada, Hong Kong, South Africa, Japan, Costa Rica, and Panama. “DarioHealth” is registered as a trademark in the United States and Israel.
Summary of Risk Factors
Our business is subject to a number of risks, including risks that may adversely affect our business, financial condition and results of operations. These risks are discussed more fully below and include, but are not limited to, risks related to:
| ● | Risks associated with our relatively new business; |
| ● | our future capital needs and their potential impact on our existing stockholders; |
| ● | our history of losses and stockholder’s inability to rely upon our historical operating performance; |
Risks Related to Our Business
| ● | the acceptance of our products in the market and our exposure to market trends; |
| ● | our risks of basing our business on the sale of our principal technology; |
| ● | our reliance on manufacturers and distributors; |
| ● | the impact of a failure of our digital marketing efforts; |
| ● | our reliance on the Apple App Store and Google’s Android platform; |
| ● | the risks associated with conducting business internationally; |
| ● | potential errors in our business processes and product offerings; |
| ● | our reliance on the performance of key members of our management team and our need to attract highly skilled personnel; |
| ● | the integration of Upright and PsyInnovations into our business; |
| ● | the volatility of capital markets and other macroeconomic factors, including due to inflationary pressures, geopolitical tensions or the outbreak of hostilities or war; |
| ● | the expense and time required to obtain regulatory clearance of our products; |
| ● | our limited clinical studies and the susceptibility to varying interpretations of such studies; |
| ● | our ability to complete clinical trials; |
| ● | the failure to comply with the FDA’s Quality System Regulation or any applicable state equivalent; |
| ● | our reliance on third parties to conduct clinical trial work; |
| ● | the impact of legislation and federal, state and foreign laws on our business, including protecting the confidentiality of patient health information; |
| ● | the potential impact of product liability suits; |
Risks Related to Our Intellectual Property
| ● | the risks relating to obtaining or maintaining our intellectual property; |
| ● | potential litigation relating to the protection of our intellectual property; |
| ● | our limited foreign intellectual property rights; |
| ● | Our reliance on confidentiality agreements and the difficulty in enforcing such agreements; |
Risks Related to Our Industry
| ● | the intense competition we face in the markets we operate; |
| ● | our need to respond quickly to technological developments; |
| ● | the risks relating to obtaining or maintaining our intellectual property; |
| ● | the risks relating to third-party payors not providing for adequate coverage and reimbursement for our products; |
Risks Related to Our Operations in Israel
| ● | the risks relating to the political, economic and military instability that may exist in Israel; |
| ● | the potential for operations to be disrupted as a result of obligations of Israeli citizens to perform military service; |
| ● | the difficulty in enforcing judgements against us or certain of our executive officers and directors; |
Risks Related to the Ownership of Our Common Stock and Warrants
| ● | the ability for our officers, directors and founding stockholders to exert influence over our affairs; |
| ● | the potential lack of liquidity, or volatility, of our common stock and warrants; |
| ● | the impact of analysts not publishing research or reports about us; |
| ● | the expense relating to our requirements as a U.S. public company; |
| ● | the potential failure to maintain effective internal controls over financial reporting; |
| ● | the existence of anti-takeover provisions in our charter documents and Delaware law; and |
| ● | that we do not intend to pay dividends on our common stock. |
