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Item 5.02
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
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On March 1, 2020, each
of Yadin Shemmer and Adam Stern were appointed as members of the Board of Directors, or the Board, of DarioHealth Corp., or the
Company, by the existing Board, to fill existing vacancies on the Board.
Mr. Shemmer, age 44,
has served in several senior operating roles across the digital health industry. From 2017 until 2019, Mr. Shemmer served as Chief
Executive Officer of Mango Health, a mobile platform for medication management and patient support. Prior to Mango Health, Mr.
Shemmer was President of the consumer business at Everyday Health (NYSE: EVDY), a leading provider of digital health and wellness
solutions. Previously, Yadin co-founded Better2Know, a digital platform enabling access to diagnostic services in the United Kingdom.
Mr. Shemmer began his career at Broadview International, a boutique investment bank serving the information technology industry. He
holds an M.B.A from London Business School and a B.A from the University of Pennsylvania.
As remuneration for
his service as a director, in lieu of receiving the same fees as the Company’s other non-executive directors, Mr. Shemmer
will receive an annual board fee of $75,000. In addition, upon his appointment, Mr. Shemmer will be granted a stock option to purchase
up to 90,000 shares of common stock, with such option vesting over a 3 year period with 15,000 shares vesting upon the six month
anniversary of the date of grant and the balance vesting ratably over ten quarterly installments after the six month anniversary
of the date of grant. Except as otherwise set forth herein, there is no arrangement or understanding between Mr. Shemmer and any
other person pursuant to which he was elected as a director, and there are no transactions in which Mr. Shemmer has an interest
requiring disclosure under Item 404(a) of Regulation S-K.
Mr. Stern was nominated
to the Board by Aegis Capital Corp., or Aegis, the placement agent from the Company’s preferred stock offering that commenced
on November 27, 2019, or the Offering. Pursuant to the placement agency agreement between the Company and Aegis, dated October
22, 2019, the Company granted Aegis the right to nominate an individual to the Board for a period of three years, which resulted
in the appointment of Mr. Stern as described herein. As a result of the Offering, the Company paid Aegis placement agent fees in
the total aggregate amount of $2,404,202 and warrants to purchase an aggregate of 719,243 shares of the Company’s common
stock at a weighted average exercise price of $4.31 per share.
Mr. Stern, age 55,
has been the head Private Equity Banking at Aegis Capital Corp. and CEO of SternAegis Ventures since 2012 and was a member of our
board of directors between October 2011 and May 2014. Prior to Aegis, from 1997 to November 2012, he was with Spencer Trask Ventures,
Inc., most recently as a Senior Managing Director, where he managed the structured finance group focusing primarily on the technology
and life science sectors. Mr. Stern held increasingly responsible positions from 1989 to 1997 with Josephthal & Co., Inc.,
members of the New York Stock Exchange, where he served as Senior Vice President and Managing Director of Private Equity Marketing.
He has been a FINRA licensed securities broker since 1987 and a General Securities Principal since 1991. Mr. Stern is a director
of Aerami Therapeutics Holdings (formerly Dance Biopharm, Inc.), Matinas BioPharma Holdings, Inc. Adgero Biopharmaceuticals Holdings
and Hydrofarm Holdings Group, Inc. Mr. Stern is a former director of InVivo Therapeutics Holdings Corp. (OTCQB: NVIV), Organovo
Holdings, Inc. (NYSE MKT: ONVO) and PROLOR Biotech Ltd., which was sold to Opko Health, Inc. (NYSE: OPK) for approximately $600
million in 2013. Mr. Stern holds a Bachelor of Arts degree with honors from The University of South Florida in Tampa.
As remuneration for
his service as a director, Mr. Stern will receive the same fees as the Company’s other non-executive directors. Except as
otherwise set forth herein, there is no arrangement or understanding between Mr. Stern and any other person pursuant to which he
was elected as a director, and except as otherwise described herein, there are no transactions in which Mr. Stern has an interest
requiring disclosure under Item 404(a) of Regulation S-K.