DarioHealth Corp. - FORM 10-Q - November 14, 2014

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EXCEL - IDEA: XBRL DOCUMENT - DarioHealth Corp.	Financial_Report.xls
EX-31.2 - EXHIBIT 31.2 - DarioHealth Corp.	v392947_ex31-2.htm
EX-32.2 - EXHIBIT 32.2 - DarioHealth Corp.	v392947_ex32-2.htm
EX-32.1 - EXHIBIT 32.1 - DarioHealth Corp.	v392947_ex32-1.htm
EX-31.1 - EXHIBIT 31.1 - DarioHealth Corp.	v392947_ex31-1.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2014

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 333-186054

LabStyle Innovations Corp.

(Exact name of registrant as specified in its charter)

Delaware	45-2973162
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

9 Halamish Street
Caesarea Industrial Park, Israel	38900
(Address of Principal Executive Offices)	(Zip Code)

+972-4-7704055

(Registrant’s telephone number, including area code)

n/a

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

¨ Large accelerated filer	¨ Accelerated filer
¨ Non-accelerated filer	x Smaller reporting company

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ¨ No x

As of November 12, 2014, the registrant had 16,233,430 shares of common stock outstanding.

LabStyle Innovations Corp. and Subsidiary

Quarterly Report on Form 10-Q

TABLE OF CONTENTS

		Page

Cautionary Note Regarding Forward-Looking Statements		-ii-

PART 1-FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)

	Consolidated Balance Sheets as of September 30, 2014 (unaudited) and December 31, 2013	-F-2-

	Consolidated Statements of Comprehensive Loss (unaudited) for the three and nine months ended September 30, 2014 and 2013	-F-4-

	Statement of Changes in Stockholders’ Deficiency (unaudited) for the nine months ended September 30, 2014 and December 31, 2013	-F-5-

	Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, 2014 and 2013	-F-6-

	Notes to Condensed Consolidated Financial Statements	-F-7-

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	10

Item 4.	Control and Procedures	10

PART II-OTHER INFORMATION		11

Item 1.	Legal Proceedings	11

Item 1A.	Risk Factors	11

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	13

Item 3.	Defaults Upon Senior Securities	13

Item 4.	Mine Safety Disclosures	13

Item 5.	Other Information	13

Item 6.	Exhibits	13

SIGNATURES		15

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain information set forth in this Quarterly Report on Form 10-Q, including in Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere herein may address or relate to future events and expectations and as such constitutes “forward-looking statements” within the meaning of the Private Securities Litigation Act of 1995. Statements which are not historical reflect our current expectations and projections about our future results, performance, liquidity, financial condition, prospects and opportunities and are based upon information currently available to us and our management and their interpretation of what is believed to be significant factors affecting our business, including many assumptions regarding future events. Such forward-looking statements include statements regarding, among other things:

our ability to manufacture, market and generate sales of our Dario^TM Diabetes Management Solution;

our future financing plans;

our anticipated needs for working capital and estimates on when our current cash resources will be depleted;

our ability to obtain regulatory and insurance reimbursement approvals for Dario^TM;

our ability to obtain and maintain intellectual property protection for our inventions;

our ability to establish and maintain our brand;

our ability to attract and retain key members of our management team;

our ability to develop and introduce new products;

the anticipated trends in our industry;

our ability to expand operational capabilities;

competition existing today or that will likely arise in the future; and

our ability to establish a market for our common stock.

Forward-looking statements, which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by use of the words “may,” “should,” “would,” “could,” “scheduled,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “seek,” or “project” or the negative of these words or other variations on these words or comparable terminology. Actual results, performance, liquidity, financial condition and results of operations, prospects and opportunities could differ materially and perhaps substantially from those expressed in, or implied by, these forward-looking statements as a result of various risks, uncertainties and other factors. These statements may be found under the section of our Annual Report on Form 10-K for the year ended December 31, 2013 (filed on March 4, 2014) entitled “Risk Factors” as well as in our other public filings.

In light of these risks and uncertainties, and especially given the pre-revenue, start-up nature of our business, there can be no assurance that the forward-looking statements contained herein will in fact occur. Readers should not place undue reliance on any forward-looking statements. Except as expressly required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

INTERIM CONSOLIDATED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2014

UNAUDITED

INDEX

	Page

Consolidated Balance Sheets	F-2 - F-3

Consolidated Statements of Comprehensive Loss	F-4

Statements of Changes in Stockholders' Deficiency	F-5

Consolidated Statements of Cash Flows	F-6

Notes to Consolidated Financial Statements	F-7 - F-20

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands

	September 30,		December 31,
	2014		2013
	Unaudited

ASSETS

CURRENT ASSETS:
Cash and cash equivalents	$	4,170	$	2,263
Restricted cash		-		38
Short-term bank deposits		87		154
Inventories		109		-
Other accounts receivable and prepaid expenses		362		475

Total current assets		4,728		2,930

LEASE DEPOSIT		48		41

PROPERTY AND EQUIPMENT, NET		1,226		1,145

Total assets	$	6,002	$	4,116

The accompanying notes are an integral part of the consolidated financial statements.

- F-2 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands (except stock and stock data)

	September 30,			December 31,
	2014			2013
	Unaudited

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

CURRENT LIABILITIES:
Trade payables	$	1,276		$	586
Other accounts payable and accrued expenses		818			920

Total current liabilities		2,094			1,506

LIABILITY RELATED TO WARRANTS		3,053			2,696

COMMITMENTS AND CONTINGENT LIABILITIES

CONVERTIBLE PREFERRED SHARES:
Series A Preferred Stock of $0.0001 par value -
Authorized: 60,000 shares at September 30, 2014 (unaudited); Issued and Outstanding: 42,350 shares at September 30, 2014 (unaudited); Aggregate liquidation preference of $4,235 at September 30, 2014 (unaudited)		5,781			-

STOCKHOLDERS' DEFICIENCY:
Common Stock of $0.0001 par value -
Authorized: 80,000,000 and 45,000,000 shares at September 30, 2014 (unaudited) and December 31, 2013, respectively; Issued and Outstanding: 15,905,871 and 4,014,381 shares at September 30, 2014 (unaudited) and December 31, 2013, respectively		2			*	)
Preferred Stock of $0.0001 par value -
Authorized: 4,940,000 and 5,000,000 shares at September 30, 2014 (unaudited) and December 31, 2013, respectively; Issued and Outstanding: none at September 30, 2014 (unaudited) and December 31, 2013		-			-
Additional paid-in capital		27,646			19,917
Accumulated deficit		(32,574	)		(20,003	)

Total stockholders' deficiency		(4,926	)		(86	)

Total liabilities and stockholders' deficiency	$	6,002		$	4,116

*) Represent an amount lower than $1.

The accompanying notes are an integral part of the consolidated financial statements.

- F-3 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

U.S. dollars in thousands (except stock and stock data)

	Three months ended September 30,						Nine months ended September 30,
	2014			2013			2014			2013
	Unaudited						Unaudited

Revenues	$	-		$	-		$	-		$	-
Ramp up of manufacturing costs		585			-			1,611			-

Gross loss		585			-			1,611			-

Operating expenses:
Research and development	$	769		$	1,078		$	3,209		$	3,169
Marketing and pre-production costs		252			763			911			1,924
General and administrative		901			1,397			3,047			4,817

Total operating expenses		1,922			3,238			7,167			9,910

Operating loss		2,507			3,238			8,778			9,910

Financial expenses (income), net:
Revaluation of warrants		(2,606	)		192			(3,144	)		3,992
Other financial expense		3,176			41			3,681			83

Total financial expenses, net		570			233			537			4,075

Net loss	$	3,077		$	3,471		$	9,315		$	13,985

Deemed dividend related to exchange agreement (Note 4a)		279			-			279			-
Deemed dividend related to Series A Preferred Stock (Note 4b)		2,977			-			2,977			-

Net loss attributable to holders of Common Stock	$	6,333		$	3,471		$	12,571		$	13,985

Net loss per share

Basic loss per share	$	(0.66	)	$	(0.85	)	$	(2.03	)	$	(3.95	)
Weighted average number of Common Stock used in computing basic net loss per share		9,610,160			3,994,481			6,179,981			3,551,559

Diluted loss per share	$	(0.66	)	$	(0.85	)	$	(2.23	)	$	(3.95	)
Weighted average number of Common Stock used in computing diluted net loss per share		9,610,160			3,994,481			6,194,418			3,551,559

The accompanying notes are an integral part of the consolidated financial statements.

- F-4 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

U.S. dollars in thousands (except stock and stock data)

	Common stock					Additional paid-in			Accumulated			Total stockholders'
	Number		Amount			capital			deficit			deficiency

Balance as of December 31, 2012		2,909,554	$	*	)	$	5,002		$	(6,072	)	$	(1,070	)

Issuance of Common Stock and warrants in February and June 2013 at $5.00 per unit, net of issuance cost		200,005		*	)		996			-			996
Cost related to issuance of Common Stock to service provider		41,667		*	)		488			-			488
Cost related to issuance of warrants to service provider in March and May 2013		-		-			523			-			523
Issuance of Common Stock and warrants in April and May 2013 at $12.50 per unit, net of issuance cost		800,000		*	)		8,987			-			8,987
Exercise of warrants		60,155		*	)		708			-			708
Exercise of options		3,000		*	)		*	)		-			*	)
Stock-based compensation		-		-			3,213			-			3,213
Net loss		-		-			-			(13,931	)		(13,931	)

Balance as of December 31, 2013		4,014,381	$	*	)	$	19,917		$	(20,003	)	$	(86	)

Issuance of Common Stock and warrants in February 2014 at $2.75 per unit, net of issuance cost		445,392		*	)		1,013			-			1,013
Issuance of Common Stock in July 2014 upon reset price mechanism		496,884		*	)		*	)		-			*	)
Deemed dividend related to exchange agreement		-		-			279			(279	)		-
Issuance of additional shares upon Exchange Agreement in August 2014		10,806,190		2			4,556			-			4,558
Deemed dividend related to Series A Preferred Stock		-		-			-			(2,977	)		(2,977	)
Exercise of warrants		68,524		*	)		352			-			352
Exercise of options		74,500		*	)		7			-			7
Stock-based compensation		-		-			1,522			-			1,522
Net loss		-		-			-			(9,315	)		(9,315	)

Balance as of September 30, 2014 (unaudited)		15,905,871	$	2		$	27,646		$	(32,574	)	$	(4,926	)

*) Represent an amount lower than $1.

The accompanying notes are an integral part of the consolidated financial statements.

- F-5 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

U.S. dollars in thousands

	Nine months ended September 30,
	2014			2013
	Unaudited
Cash flows from operating activities:
Net loss	$	(9,315	)	$	(13,985	)
Adjustments required to reconcile net loss to net cash used in operating activities:
Stock-based compensation, warrants and restricted shares		1,522			3,605
Issuance cost related to warrants to investors and service provider		533			-
Depreciation		461			578
Decrease (increase) in other accounts receivable and prepaid expenses		117			(156	)
Increase in inventories		(109	)		-
Increase in trade payables		367			275
Increase in other accounts payable and accrued expenses		276			217
Consideration granted to the February 2014 Investors from Exchange Agreement		3,124			-
Revaluation of fair value of warrants to purchase shares of Common Stock		(3,144	)		3,992

Net cash used in operating activities		(6,168	)		(5,474	)

Cash flows from investing activities:
Investment in short-term bank deposits		(130	)		(105	)
Proceeds of maturities of short-term bank deposit		230			35
Investment in lease deposits		(6	)		(106	)
Purchase of property and equipment		(219	)		(1,308	)

Net cash used in investing activities		(125	)		(1,484	)

Cash flows from financing activities:
Proceeds from issuance of Common Stock and warrants, net of issuance cost		3,754			9,970
Proceeds from issuance of Series A Preferred Stock and warrants, net of issuance cost		4,096			-
Proceeds from exercise of options and warrants		350			226

Net cash provided by financing activities		8,200			10,196

Increase in cash and cash equivalents		1,907			3,238
Cash and cash equivalents at beginning of period		2,263			1,230

Cash and cash equivalents at end of period	$	4,170		$	4,468

Non-cash investing and financing and activities:

Receivable on account of shares	$	-		$	12

Purchase of property and equipment	$	323		$	29

Conversion of liability related to warrants to Common Stock	$	9		$	403

The accompanying notes are an integral part of the consolidated financial statements.

- F-6 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 1:-

GENERAL

LabStyle Innovations Corp. (the "Company") was incorporated in Delaware and commenced operations on August 11, 2011. The Company is a mobile health (mHealth) company developing and commercializing patented technologies to provide consumers with laboratory-testing capabilities using smart phones and other mobile devices. The Company’s initial product, Dario™, is a mobile, cloud-based, diabetes management solution which includes a pocket-sized blood glucose monitoring device (the "Dario™ Smart Meter") that, utilizing proprietary software, integrates with smart phones and other mobile devices to offer users the ability to record, save, track, analyze, manage and share diabetes related information.

The Company has a wholly owned subsidiary, LabStyle Innovation Ltd. ("Ltd."), incorporated and located in Israel, which commenced operations on September 14, 2011. Its principal business activity is to hold the Company’s intellectual property and to perform research and development, manufacturing, marketing and other business activities. Ltd. has a wholly-owned subsidiary, LabStyle Innovations US LLC, a Delaware limited liability company, which was established in 2014 in anticipation of U.S. operations for the Company.

During the nine month period ended September 30, 2014, the Company incurred operating losses and negative cash flows from operating activities amounting to $8,778 and $6,168, respectively. The Company will be required to obtain additional capital resources in the near term to support its products commercialization, ramp up manufacturing and maintain its research and development activities. The Company is addressing its liquidity needs by seeking for additional funding from public and/or private sources and by commencing its commercial sales. There are no assurances, however, that the Company will be able to obtain an adequate level of financial resources that are required for the short and long-term development and commercialization of its product.

According to management estimates, the Company has sufficient liquidity resources to continue its planned activity through March 2015. Failure of the Company to obtain additional funding would have a materially adverse effect on the Company’s results of operations, future operations and overall viability.

These conditions raise substantial doubt about the Company's ability to continue as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effects on recoverability and classification of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.

On March 20, 2014, the Company filed a registration statement (the "Third Registration Statement") with the Securities and Exchange Commission (the "SEC") covering the public resale of up to 779,436 shares of common stock, par value $0.0001 per share, of the Company (the "Common Stock") (including 334,044 shares of Common Stock underlying warrants) previously issued to the investors from the private placement occurred on February 2014 (the "February 2014 Private Placement") (see also Note 4a). The Third Registration Statement was declared effective on June 3, 2014.

- F-7 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 1:-

GENERAL (Cont.)

On May 1, 2014, the Company announced the receipt of a U.S Notice of Allowance for a key patent relating to how the Dario™ blood glucose monitor draws power from and transmits data to a smart phone via the audio jack port.

On June 17, 2014, the Company held its 2014 Annual Meeting of Stockholders in which, among other matters, Company stockholders approved an amendment to the Company's Certificate of Incorporation (the "COI") to increase the number of authorized shares of Common Stock from 45,000,000 to 80,000,000; to amend the Company's 2012 Equity Incentive Plan (the "2012 Plan") to increase the number of Common Stock authorized for issuance under the 2012 Plan by 500,000 shares from 1,000,000 to 1,500,000 (see also Note 4d) and to approve the amendment to the COI to effect a reverse stock split of the Common Stock at a ratio of between one-for-two and one-for-five with such ratio to be determined at the sole discretion of the Company's Board of Directors (the "Reverse Split") and with such Reverse Split to be effected at such time and date, if at all, as determined by the Board of Directors of the Company in its sole discretion.

On September 18, 2014, the Company's Board of Directors approved the Reverse Split at a ratio of one for five. Such Reverse Split was implemented on October 6, 2014. The amount of authorized Common Stock as well as the par value for the Common Stock was not affected. Any fractional shares resulting from the reverse stock split were rounded up to the nearest whole share (an additional 98 shares were issued during October 2014 to account for such rounding).

All Common Stock, warrants, options and per share amounts set forth herein are presented to give retroactive effect to the Reverse Split for all periods presented.

On April 28, 2014 the Company received a national approval and regional reimbursement for the Dario™ in Italy.

On June 25, 2014 the Company received a reimbursement status for strips and lancets to be utilized together with the Dario™, effective September 1, 2014 in England, Wales, Scotland and Northern Ireland.

On July 2014, the Company received an approval from Israel's Ministry of Health to sell the Dario™ for diabetes in Israel as well as released the Dario™ App for Android smartphone users in select soft launch markets, including the United Kingdom and New Zealand.

- F-8 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 2:-

SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies applied in the annual financial statements of the Company as disclosed in the Company's Annual Report on Form 10-K for the period ended December 31, 2013 are applied consistently in these financial statements except:

In June 2014 the FASB issued Update No. 2014-10 Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation. The amendments in this Update remove the definition of a development stage entity from the Master Glossary of the Accounting Standards Codification, thereby removing the financial reporting distinction between development stage entities and other reporting entities from U.S. GAAP. In addition, the amendments eliminate the requirements for development stage entities to (1) present inception-to-date information in the statements of comprehensive loss, cash flows, and stockholder deficiency, (2) label the financial statements as those of a development stage entity, (3) disclose a description of the development stage activities in which the entity is engaged, and (4) disclose in the first year in which the entity is no longer a development stage entity that in prior years it had been in the development stage. The amendments are effective prospectively for reporting periods beginning after December 15, 2014 early adoption is permitted. Although the Company has elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the Jumpstart Our Business Act of 2012, since early adoption is permitted the Company chose to early adopt the update for June 30, 2014 consolidated financial statement.

In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (ASU 2014-09) "Revenue from Contracts with Customers" which supersedes the revenue recognition requirements in "Revenue Recognition"(Topic 605), and requires entities to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods and services. ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted. The Company is currently in the process of evaluating the impact of the adoption of ASU 2014-09 on its consolidated financial statements.

Series A Preferred Stock:

The Company classifies the Series A Preferred Stock (as defined in Note 4b) outside of Stockholders' deficiency because certain features of the Company's COI would require redemption of some or all of the Series A Preferred Stock upon events not solely within the control of the Company.

- F-9 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 3:-

UNAUDITED INTERIM FINANCIAL STATEMENTS

The accompanying unaudited interim consolidated financial statements as of September 30, 2014, have been prepared in accordance with U.S. generally accepted accounting principles and standards of the Public Company Accounting Oversight Board for interim financial information. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles in the United States for complete financial statements. In the opinion of management, the unaudited interim consolidated financial statements include all adjustments of a normal recurring nature necessary for a fair presentation of the Company's consolidated financial position as of September 30, 2014, the Company's consolidated results of operations and the Company's consolidated cash flows for the nine and three months ended September 30, 2014. Results for the nine and three months periods ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ended December 31, 2014.

NOTE 4:-

STOCKHOLDERS' DEFICIENCY

On February 18, 2014, the Company consummated the February 2014 Private Placement with institutional and other accredited investors (the "February 2014 Investors"), pursuant to which the Company issued units comprised of an aggregate of (i) 445,392 shares of common stock (the "February 2014 Shares") and (ii) warrants initially exercisable to purchase an aggregate of 334,044 shares of Common Stock (the "February 2014 Warrants"). The price per unit issued in this offering was $9.40, yielding proceeds of approximately $3,754 net of issuance costs.

The placement agent in the February 2014 Private Placement received in addition to cash fees, the right to receive 28,977 warrants to purchase Common Stock of the Company having the same terms and conditions as the February 2014 Warrants.

Pursuant to the terms of the February 2014 Private Placement, the Company was required to issue additional shares of Common Stock (the "Adjustment Shares") to the February 2014 Investors at a specified time in the event that the price per share of Common Stock issued in the February 2014 Private Placement was greater than the price per share of the Common Stock, calculated as 90% of the average of the ten lowest weighted average prices of the Common Stock during the twenty trading day period starting immediately following the earlier of the date on which the February 2014 Shares, shares of Common Stock underlying the February 2014 Warrants and Adjustment Shares were registered for resale with the SEC or were able to be sold without restriction under Rule 144 under the Securities Act (the "Reset Price"); provided, that, subject to the terms and conditions of the February 2014 Private Placement, the Company was required to issue further additional shares of Common Stock at one or more additional specified times if the shares of Common Stock issued in the February 2014 Private Placement were not freely tradable for certain specified minimum periods.

- F-10 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 4:-

STOCKHOLDERS' DEFICIENCY (Cont.)

The February 2014 Warrants were immediately exercisable at an exercise price of $11.75 per share and expire five years after the date that the shares of Common Stock underlying such warrants have been registered for resale with the SEC or are able to be sold without restriction under Rule 144 under the Securities Act. The February 2014 Warrants were subject to adjustment under certain circumstances, including "full ratchet" anti-dilution protection upon the issuance of any Common Stock (including the Adjustment Shares), securities convertible into Common Stock, or certain other issuances at a price below the then-existing exercise price, with certain exceptions. In addition, upon certain changes in control events, the holders of the warrants were granted the right to receive, subject to certain limitations and assumptions, cash equal to the Black-Scholes value of the outstanding warrants.

Based on the aforementioned terms the February 2014 Warrants have been accounted for as liability according to the provisions of ASC 815-40, "Derivatives and Hedging - Contracts in Entity's Own Equity" ("ASC 815-40").

In connection with the February 2014 Private Placement, the Company also entered into a Registration Rights Agreement (the "RRA") with the February 2014 Investors. Pursuant to the terms of the RRA, the Company granted to the February 2014 Investors certain registration rights related to the February 2014 Shares, Warrants and the Adjustment Shares issued and issuable in this private placement. According to the RRA, the Company was required to file a registration statement for the resale of the Shares, Common Stock underlying the February 2014 Warrants and Adjustment Shares within 30 days following the closing date of the February 2014 Private Placement and to use its reasonable best efforts to cause such registration statement to be declared effective within 60 days following the closing date (or 120 days following the closing date if the SEC reviewed the registration statement). The Company was subject to potential liquidated damages to each February 2014 Investor of up to nine percent (the "Registration Fee") of the pro-rata purchase price of the Shares for failure to meet its registration obligations under the RRA.

Following the effectiveness of the Company's Third Registration Statement on June 3, 2014 (see also Note 1c), and in accordance with the terms of the February 2014 Private Placement, on July 2, 2014 the Company issued 496,884 Adjustments Shares based on a reset price of $4.45 to the February 2014 Investors. In addition, the exercise price for the investors and placement agent warrants of the February 2014 Private Placement was adjusted to $4.45 and additional 549,338 and 47,653 warrants became eligible for issuance upon exercise of such warrants, respectively.

On August 15, 2014, the Company entered into a separate amendment and exchange agreements with the February 2014 Investors (each, an "Exchange Agreement") pursuant to which certain terms of the original investment agreements were eliminated and all of the aforesaid warrants were exchanged and terminated in consideration of the issuance on August 22, 2014 of an aggregate of 10,806,190 shares of Common Stock pursuant to the formula described in the Exchange Agreement.

- F-11 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 4:-

STOCKHOLDERS' DEFICIENCY (Cont.)

On September 22, 2014 and following to such Exchange Agreement, the Company entered into an agreement with the placement agent of the February 2014 Private Placement to terminate its right to receive warrants in exchange for 151,325 shares of Common Stock pursuant to the same formula as described in the Exchange Agreement. Such Common Stock were issued to the placement agent on October 7, 2014.

The exchange to the February 2014 Investors and placement agent is considered as a modification of the terms of the February 2014 Private Placement. The incremental value that was generated from the aforementioned exchanged warrants (including other eliminated rights) and the fair value of new shares of Common Stock that were issued, amounted to $3,403 and was allocated to the exchanged warrants and eliminated reset feature based on their relative fair value which was determined by the Company's management by assistance of third party appraiser. Therefore, $279 out of the above amount was allocated to the eliminated reset feature and was accounted for as deemed dividend in the Statement of Changes in Shareholders’ Deficiency. The remaining amount of $3,124 was allocated to the exchanged warrants and was recorded as part of the finance expenses in the consolidated statement of comprehensive loss.

On September 23, 2014, the Company entered into and closed the transactions contemplated by a definitive Securities Purchase Agreement (the "September 2014 Private Placement") with institutional and accredited investors (the "September 2014 Investors") pursuant to which the Company raised approximately $4,100 in net proceeds by issuance of aggregate 42,350 units which consist of 42,350 shares of newly designated Series A Convertible Preferred Stock (the "Series A Preferred Stock") which are convertible into 10,683,662 Common Stock and 5,341,834 warrants to purchase shares of Common Stock with an exercise price of $0.48 per share.

The warrants issued in the September 2014 Private Placement are exercisable immediately upon issuance and may be exercised at any time prior to September 23, 2018. They also are eligible for "cashless exercise" only if the underlying shares of Common Stock are not registered for resale. If the Company fails to timely deliver registered shares of Common Stock to the September 2014 Investors upon exercise, it would be subject to certain "buy in" and liquidated damages penalties and therefore these warrants are classified as a liability according to the provisions of ASC 815-40.

The Series A Preferred Stock have certain rights and privileges among others, a liquidation preference which might be applied in certain deemed liquidation events such as changes in control of the Company and therefore are classified out of the Company's equity, as mezzanine according to the provisions of ASC 480-10-S99 "Distinguishing Liabilities from Equity".

- F-12 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 4:-

STOCKHOLDERS' DEFICIENCY (Cont.)

In addition, based on the fair value of each Series A Preferred Stock and Common stock as of September 23, 2014 and subject to the conversion right pursuant to which each Series A Preferred Stock shall be converted into shares of Common Stock at a ratio of 1 to 252 at any time by election of the September 2014 Investors, the Company has measured a beneficial conversion feature in a total amount of $2,977 which was accounted as deemed dividend and was recorded as additional mezzanine during the nine and three months period ended September 30, 2014.

The Company is obligated to file a registration statement registering all of such Common Stock underlying the above warrants and Series A Preferred Stock (the "Registrable shares") within 30 days following the closing date of the September 2014 Private Placement and cause such registration statement to become effective within 60 days (or 120 days following the closing date if the SEC determines to review the registration statement) after such filing and ensure that after the applicable effective dates, all the Registrable Shares are able to be sold (whether pursuant to a registration statement or otherwise). Failure to comply with any one of these registration requirements (subject to applicable grace periods) triggers certain liquidated damages payable by the Company to each of the September 2014 Investors.

Subsequent to the balance sheet date, on October 15, 2014, the Company filed a registration statement covering the public resale of up to 10,683,662 shares of Common Stock underlying the Series A Preferred Stock and 5,341,834 shares of Common Stock underlying warrants, sold in the September 2014 Private Placement (the "Fourth Registration Statement"). Such registration statement was declared effective on October 30, 2014.

The Exchange Agreement and the September 2014 Private Placement triggered the anti-dilution mechanism of the warrants issued in the Company’s private placement which closed in March 2012 (the "2011-2012 Private Placement") by adjusting the current exercise price of the warrants for the investors and placement agent from $6.50 to $1.23 and additional 2,297,624 and 437,537 shares became subject to such warrants, respectively. In addition, the exercise price for the placement agent warrants of the 2011-2012 Private Placement, with a current exercise price of $5.00 was adjusted to $1.00 and additional 338,099 warrants were issued (see also Note 5a).

Stock-based compensation:

On June 17, 2014, the Company’s majority stockholders (with the prior recommendation and approval of the Board of Directors) approved an increase in the size of the 2012 Plan from 1,000,000 shares of Common Stock to 1,500,000 shares of Common Stock.

- F-13 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 4:-

STOCKHOLDERS' DEFICIENCY (Cont.)

On July 7, 2014, the Company's Board of Directors approved the grant of 220,000 and 79,000 options to employees and non-employees, respectively, at an exercise price of $4.90 per share. Such options shall vest in 8 quarterly instalments over a period of 2 years commencing the above date. The options have a cashless exercise feature and a ten years contractual term, unless otherwise approved by the Compensation Committee of the Board of Directors, and shall be issued under the 2012 Plan.

In addition on the same date, the Board of Directors approved a one-time grant of fully-vested 30,000 options to a new non-employee director. These options have an exercise price of $4.90, have a cashless exercise feature and a ten years contractual term. The non-employee director options were not issued under the Company’s 2012 Equity Incentive Plan and shall be deemed to have been issued under an "employee benefit plan" as defined in Rule 405 promulgated under the Securities Act.

As of September, 30, 2014, 374,900 options to purchase Common Stock are available for future grants under the 2012 Plan to employees, advisors, consultants and service providers of the Company or Ltd.

The total compensation cost related to all of the Company's equity-based awards, recognized during the period of nine and three months ended September 30, 2014 was comprised as follows:

	Three months ended September 30, 2014			Nine months ended September 30, 2014
	Unaudited

Ramp up of manufacturing costs	$	(1	)	$	35
Research and development		62			342
Sales and marketing		11			17
General and administrative		251			1,128

	$	323		$	1,522

As of September 30, 2014, the total amount of unrecognized stock-based compensation expenses was approximately $894 which will be recognized over a weighted average period of 0.75 years.

During the nine months ended September 30, 2014, proceeds from warrants and options exercise amounted to $343 and $7 following the issuance of 68,524 and 74,500 Common Stock, respectively.

- F-14 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 5:-

FAIR VALUE MEASURMENTS

ASC 820, "Fair Value Measurements and Disclosures" ("ASC 820"), defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions and risk of nonperformance.

ASC 820 also establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument's categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. ASC 820 establishes three levels of inputs that may be used to measure fair value:

Level 1 -

quoted prices in active markets for identical assets or liabilities;

Level 2 -

inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; or

Level 3 -

unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The following financial instruments are being accounted for as a liability:

On March 30, 2012, the Company consummated the 2011-2012 Private Placement pursuant to which the investors purchased an aggregate of 492,200 shares of Common Stock and warrants to purchase 492,200 shares of Common Stock at the exercise price of $7.50 for total consideration of $2,461.

The placement agent for the 2011-2012 Private Placement and its permitted designees were granted warrants to purchase an aggregate of (i) 96,440 shares of Common Stock at the exercise price of $5.00 per share and (ii) 96,440 shares of Common Stock at the exercise price of $7.50 per share.

Subsequent to the issuance of the 2011-2012 Private Placement warrants the original exercise price of the warrants for the investors and placement agent was adjusted from $7.50 to $1.23 and additional 2,371,827 and 452,028 warrants were issued, respectively. In addition, the exercise price for the placement agent warrants of the 2011-2012 Private Placement, with an original exercise price of $5.00 was adjusted to $1.00 and additional 338,099 warrants were issued.

On February 18, 2014, the Company consummated the February 2014 Private Placement (see Note 4a).

- F-15 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 5:-

FAIR VALUE MEASURMENTS (Cont.)

On September 23, 2014, the Company consummated the September 2014 Private Placement (see Note 4c).

The warrants of 2011-2012 Private Placement and February 2014 Private Placement contain non-standard anti-dilution protection provisions and the warrants of September 2014 Private Placement contain certain “buy in” and liquidated damages penalties and therefore the Company accounts for such warrants as a liability according to the provisions of ASC 815-40. The Company measures the above mentioned warrants by using the Binomial option-pricing model in each reporting period until the warrants are exercised or expired, with changes in the fair values being recognized in the Company’s statement of comprehensive loss as financial income or expense.

In estimating the warrants’ fair value, the Company used the following assumptions:

Investors’ warrants in 2011-2012 Private Placement:

	September 30, 2014			December 31, 2013

Risk-free interest rate (1)		0.62	%		0.70	%
Expected volatility (2)		52.31	%		52.09	%
Expected life (in years) (3)		2.08			2.82
Expected dividend yield (4)		0	%		0	%

Fair value per warrant	$	0.40		$	3.70

Placement agent's warrants 2011-2012 Private Placement:

	September 30, 2014			December 31, 2013

Risk-free interest rate (1)		0.36	%		0.50	%
Expected volatility (2)		49.55	%		50.91	%
Expected life (in years) (3)		1.52			2.25
Expected dividend yield (4)		0	%		0	%

Fair value per warrant	$	0.30-0.35		$	3.35-4.15

- F-16 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 5:-

FAIR VALUE MEASURMENTS (Cont.)

Investors and placement agent's warrants in February 2014 Private Placement:

	August 15, 2014			Issuance date

Risk-free interest rate (1)		1.48	%		1.63	%
Expected volatility (2)		51.21	%		61.49	%
Expected life (in years) (3)		4.8			5.20
Expected dividend yield (4)		0	%		0	%

Fair value per warrant	$	1.10		$	8.90

Investors' warrants in September 2014 Private Placement:

	September 30, 2014			Issuance date

Risk-free interest rate (1)		1.42	%		1.42	%
Expected volatility (2)		48.85	%		48.75	%
Expected life (in years) (3)		3.98			4.0
Expected dividend yield (4)		0	%		0	%

Fair value per warrant	$	0.30		$	0.25

(1)

Risk-free interest rate - based on yield rates of non-index linked U.S. Federal Reserve treasury bonds.

(2)

Expected volatility - was calculated based on actual historical stock price movements of companies in the same industry over a term that is equivalent to the expected term of the option.

(3)

Expected life - the expected life was based on the expiration date of the warrants.

(4)

Expected dividend yield - was based on the fact that the Company has not paid dividends to its shareholders in the past and does not expect to pay dividends to its shareholders in the future.

- F-17 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 5:-

FAIR VALUE MEASURMENTS (Cont.)

The changes in Level 3 liabilities associated with the 2011-2012 Private Placement, the February 2014 Private Placement and September 2014 Private Placement warrants are measured at fair value on a recurring basis. The following tabular presentation reflects the components of the liability associated with such warrants as of September 30, 2014:

	Fair value of liability related to warrants

Balance at December 31, 2013	$	2,696
Fair value of warrants to investors and placement agent in the February 2014 Private Placement		3,230
Exchange of the warrants from issuance of Common Stock in the February 2014 Private Placement (Note 4a)		(1,056	)
Fair value of warrants to investors and placement agent in the September 2014 Private Placement (Note 4b)		1,336
Change in fair value of warrants during the period		(3,144	)
Exercise of warrants (*)		(9	)

Balance at September 30, 2014 (unaudited)	$	3,053

(*) During the nine month period ended September 30, 2014, the placement agent exercised 1,824 warrants for a total amount of 1,824 shares of Common Stock of the Company, respectively.

As of September 30, 2014, there were outstanding warrants to purchase 9,141,163 shares of Common Stock from the above issuances which were recorded as a liability.

- F-18 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 6:-

SELECTED STATEMENTS OF OPERATIONS DATA

General and administrative:

	Three months ended September 30				Nine months ended September 30
	2014		2013		2014		2013
	Unaudited

Payroll, office and related	$	194	$	374	$	754	$	908
Legal and professional fees		335		423		788		892
Stock-based compensation		251		569		1,128		1,927
Issuance of Common Stock and warrants to service provider		-		-		-		1,011
Other		121		31		377		79

Total General and administrative	$	901	$	1,397	$	3,047	$	4,817

Financial expenses (income), net:

	Three months ended September 30					Nine months ended September 30
	2014			2013		2014			2013
	Unaudited

Bank charges	$	6		$	5	$	13		$	19
Foreign currency adjustments losses		2			36		11			64
Issuance cost related to warrants to investors and service provider		44			-		533			-
Consideration granted to the February 2014 Investors from Exchange Agreement		3,124			-		3,124			-
Revaluation of warrants		(2,606	)		192		(3,144	)		3,992

Total Financial expenses (income), net	$	570		$	233	$	537		$	4,075

- F-19 -

LABSTYLE INNOVATIONS CORP. AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands (except stock and stock data)

NOTE 6:-

SELECTED STATEMENTS OF OPERATIONS DATA (Cont.)

Net loss per share:

The following table sets forth the computation of basic and diluted net loss per share:

	Three months ended September 30				Nine months ended September 30
	2014		2013		2014		2013
	Unaudited

Numerator:

Numerator for basic net loss per share	$	6,333	$	3,471	$	12,571	$	13,985

Effect of dilutive securities:
Warrants issued to investors and placement agent		-		-		1,236		-

Numerator for dilutive net loss per share	$	6,333	$	3,471	$	13,807	$	13,985

Denominator:

Denominator for basic net loss per share - weighted average number of Common Stock		9,610,160		3,994,481		6,179,981		3,551,559

Effect of dilutive securities:
Warrants issued to investors and placement agent		-		-		14,437		-

Denominator for diluted net loss per share - adjusted weighted average number of Common Stock		9,610,160		3,994,481		6,194,418		3,551,559

NOTE 7:-

SUBSEQUENT EVENTS

On October 15, 2014, the Company filed the Fourth the Registration Statement (See Note 4b). Such registration statement was declared effective on October 30, 2014.

- F-20 -

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following financial data in this narrative are expressed in thousands, except for stock and stock data.

On October 6, 2014, we affected a 1-for-5 reverse stock split of our outstanding common stock, which we refer to herein as the "reverse split". Our authorized common stock and the par value of our common stock were not impacted by the reverse split. References in this Quarterly Report to our capitalization and other matters pertaining to our common stock relate to our capitalization and common stock after giving effect to the reverse split.

The following discussion should be read in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and the consolidated financial statements and related notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2013.

This discussion contains certain forward-looking statements that involve risks and uncertainties. Our actual results and the timing of certain events could differ materially from those discussed in these forward-looking statements as a result of certain factors, including, but not limited to, those set forth herein and elsewhere in this Quarterly Report and in our other filings with the Securities and Exchange Commission. See “Cautionary Note Regarding Forward Looking Statements.”

Overview

We are a mobile health (mHealth) company developing and commercializing patented technology providing consumers with laboratory-testing capabilities using smart phones and other mobile devices. We were formed in August 2011 as a Delaware corporation.

Our initial product is Dario™, a mobile, cloud-based, diabetes management solution which includes novel software applications combined with a stylish, “all-in-one”, pocket-sized, blood glucose monitoring device (which we call our Dario™ Smart Meter) that will compete in the estimated $12 billion dollar worldwide market for patient self-monitoring of blood glucose (which we refer to as SMBG) products. Dario™ is a comprehensive system incorporating patented technology that combines a cutting edge software application and cloud-based data services with a novel all-in-one Dario™ Smart Meter consisting of a lancet (to obtain a blood sample), a device-specific disposable test strip cartridge and a smartphone-driven glucose reader adaptor.

On September 23, 2013, we announced our receipt of CE Mark certification to market Dario™. The receipt of the CE Mark allows Dario™ to be marketed and sold in 32 countries across Europe as well as in certain other countries worldwide. On March 5, 2014, MDSS, our European Authorized Representative, completed the registration of the Dario™ Smart Meter with the German Authority as required by Article 10 of Directive 98/79/EC on in vitro diagnostic medical devices. We are currently pursing regulatory approval for Dario™ in the United States and are expecting to receive clearance from the U.S. Food and Drug Administration on our 510(k) application by mid 2015.

In January 2014, the Dario™ test strips (manufactured for us by a third party supplier) were evaluated by an independent German research institution. The aim of this study was to collect measurement data from capillary blood with defined distribution of glucose concentrations in order to perform system accuracy evaluation according to ISO 15197:2013, the current international standard requirements for SMBG systems. The results of this study showed that the Dario™ strips are well within the limits for system accuracy defined by ISO 15197:2013 in that 100% of results fell within zones A and B of the Consensus Error Grid for all systems, which means that the system accuracy requirements of the ISO 15197:2013 have been met.

In December 2013, we began offering free downloads of the Dario™ software application in selected jurisdictions, and in March 2014, we commenced our global multi-market soft launch of the Dario™ Smart Meter in selected jurisdictions. The first shipments were sent to distributers in late March 2014.

In April 2014, we announced the receipt of reimbursement coverage for the use of the Dario™ Smart Meter in Italy, making 600,000 Italians eligible for reimbursement coverage. We are pursuing reimbursement coverage in other jurisdictions.

In June 2014, we were granted (effective September 1, 2014) reimbursement status in England, Wales, Scotland and Northern Ireland for strips and lancets to be utilized together with the Dario™ Smart Meter. We are actively pursuing reimbursement coverage in other jurisdictions.

In July 2014, we received approval from Israel’s Ministry of Health to sell the Dario™ Smart Meter for diabetes in Israel as well as released the Dario™ Diabetes Management App for Android smartphone users. The mobile application will have the same user interface and features as the iOS Dario™ Application and will be available in select soft launch markets, including the United Kingdom and New Zealand.

In addition, since 2013, we have worked to secure distribution partnerships in a number of jurisdictions, including the United Kingdom, Italy, Australia, New Zealand, the Netherlands and Canada. These partnerships, along with our own online marketing programs, will be key to our sales and distributions efforts for Dario™.

We are presently pursuing patent applications in multiple jurisdictions covering the specific processes related to blood glucose level measurement as well as more general methods of rapid tests of body fluids using mobile devices and cloud-based services. On August 5, 2014, we were issued a U.S. patent (No. 8,797,180) relating to how the Dario™ blood glucose monitor draws power from and transmits data to a smart phone via the audio jack port. We believe this represents a critical intellectual property recognition and a significant initial validation of our intellectual property efforts.

Readers are cautioned that, according to our management’s estimates, based on our budget and the initial launch of our commercial sales we believe that we will have sufficient resources to continue our activity only into March 2015. This includes a small amount of anticipated initial inflows from sales of Dario™ through distribution partners. As such, we have a significant present need for capital. If we are unable to scale up our commercial launch of Dario™ or meet our commercial sales targets (or if we are unable to generate any revenue at all), and if we are unable to obtain additional capital resources in the near term, we may be unable to continue activities, absent a material alternations in our business plans and our business might fail.

Critical Accounting Policies

Our financial statements are prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States (or US GAAP). Our fiscal year ends December 31.

This Management’s Discussion and Analysis of Financial Condition and Results of Operations discuss our financial statements, which have been prepared in accordance with US GAAP. The preparation of these financial statements requires making estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported revenues and expenses for the reporting periods. On an ongoing basis, we evaluate such estimates and judgments. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ (perhaps significantly) from these estimates under different assumptions or conditions.

While all the accounting policies impact the financial statements, certain policies may be viewed to be critical. Our management believes that the accounting policies which involve more significant judgments and estimates used in the preparation of our consolidated financial statement include warrants liability, stock-based compensation, accounting for production equipment and its related useful life.

Revenue recognition

We will derive revenues from the sale of our device-specific disposables test strip cartridges, lancets and, in a small number of select jurisdictions, sales of Dario™ Smart Meters through distributers. The Dario™ software application is offered for a free download and we do not have a recurring hosting commitment with our end users relating specifically to the application.

Revenues from product sales are recognized in accordance with ASC 605-10 "Revenue Recognition", when delivery has occurred, persuasive evidence of an agreement exists, the vendor’s fee is fixed or determinable, no further obligation exists and collectability is probable. The Company generally does not grant a right of return. We assess whether the fee is fixed or determinable based on the nature of the fee charged for the products delivered, the existing contractual arrangements and the distributor’s consistency of payments. When evaluating collectability, we consider whether we have sufficient history to reliably estimate the distributor's payment patterns.

Through September 30, 2014, product sales to distributors are only recognized as revenue upon receipt of payment. We will continue to do so until we will have sufficient historical experience with each distributor in order to conclude that fee is fixed or determinable and collectability is probable.

Warrant liability

The fair value of the liability for certain warrants issued to investors and our previous placement agents in connection with our financings to date was calculated using the Binomial model. We accounted for these warrants according to the provisions of ASC 815, “Derivatives and Hedging - Contracts in Entity’s Own Equity” and, based on the anti-dilution protections contained in part of the warrants and the "buy in" rights contained in other warrants, we classified them as liabilities, measured at fair value each reporting period until they will be exercised or expired, with changes in the fair values being recognized in our statement of comprehensive loss as financial income or expense. The anti-dilution protection for warrants with anti-dilution protection was valued by calculating a put option. The value of these warrants was calculated using the call option value in addition with the put option value, which reflects the anti-dilution protection, multiplied by the probability that a down round will occur. The value of warrants which includes certain "buy in" and liquidated damages penalties and do not include anti-dilution provision was calculated using a call option value.

Fair value for each reporting period was calculated based on the following assumptions:

(1)

Risk-free interest rate - based on yield rates of non-index linked U.S. Federal Reserve treasury bonds.

(2)

Expected volatility - was calculated based on actual historical stock price movements of companies in the same industry over a term that is equivalent to the expected term of the option.

(3)

Expected life - the expected life was based on the expiration date of the warrants.

(4)

Expected dividend yield - the Company has not paid dividends to its shareholders in the past and does not expect to pay dividends to its shareholders in the future and therefore was measured as 0%.

Exercised warrants are being measured at fair value as of their exercise date and subsequently reclassified from liability to additional paid in capital. Our net loss for the nine months ended September 30, 2014 and 2013 included finance expenses (income) in the amount of ($3,144) and $3,992, respectively, with connection to the above-mentioned warrants.

Stock-Based Compensation

We account for stock-based compensation in accordance with ASC 718 “Compensation- stock compensation” which requires companies to estimate the fair value of equity-based payment awards on the date of grant using the Black-Scholes option-pricing model.

The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in our consolidated income statements.

We recognize compensation expenses for the value of awards granted based on the straight line method over the requisite service period of each of the awards, net of estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The term “forfeitures” is distinct from “cancellations” or “expirations” and represents only the unvested portion of the surrendered option. Ultimately, the actual expenses recognized over the vesting period will only be for those shares that vest.

We selected the Black-Scholes option pricing model as the most appropriate fair value method for stock-option awards based on the market value of the underlying shares at the date of grant. This option-pricing model requires a number of assumptions, of which the most significant are the expected stock price volatility and the expected option term. Expected volatility was calculated based upon historical volatilities of similar entities in the related sector index. The expected option term represents the period that the Company’s stock options are expected to be outstanding and is determined based on the simplified method until sufficient historical exercise data will support using expected life assumptions. The risk-free interest rate is based on the yield from U.S. treasury bonds with an equivalent term. The Company has historically not paid dividends and has no foreseeable plans to pay dividends.

Our net loss for the nine months ended September 30, 2014 includes stock-based compensation costs, with respect to options granted to employees and directors of our company, in the amount of $1,332 as compared to $2,456 for the nine months period ended September 30, 2013. The decrease from 2014 to 2013 is mainly due to decrease in our Common Stock market value which resulted in fair value decrease of new awards granted during the third quarter of 2014.

We apply ASC 718 and ASC 505-50 “Equity-Based Payments to Non-Employees”, with respect to options and warrants issued to non-employees. ASC 718 requires the use of option valuation models to measure the fair value of the options and warrants at the measurement date.

In connection with options granted to non-employees for services received for the nine month period ended September 30, 2014 and 2013, and our determination of the fair value of our common shares, we have recorded stock-based compensation expense of $190 and $137, respectively, which represent the fair value of non-employee options grants. Increase from 2014 to 2013 was mainly driven due to options granted to our scientific advisory board during the second quarter of 2014.

Production Equipment

Capitalization of Costs. We capitalize direct incremental costs of third party manufacturers related to our production equipment. We cease construction cost capitalization relating to our production equipment once it is ready for its intended use and held available for occupancy. All renovations and betterments that extend the economic useful lives of assets and / or improve the performance of the production equipment are capitalized.

Useful Lives of Assets. We are required to make subjective assessments as to the useful lives of our production equipment for purposes of determining the amount of depreciation to record on an annual basis with respect to our construction of the production equipment. These assessments have a direct impact on our net income (loss). Production equipment are usually depreciated on a straight-line basis over a period of up to five years, except any renovations and betterments which are depreciated over the remaining life of the production equipment.

Extended Transition Period for “Emerging Growth Companies.” We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the Jumpstart Our Business Act of 2012 (known as the JOBS Act). This election allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates. Consequently, our financial statements may not be comparable to companies that comply with public company effective dates. Because our financial statements may not be comparable to companies that comply with public company effective dates, investors may have difficulty evaluating or comparing our business, performance or prospects in comparison to other public companies, which may have a negative impact on the value and liquidity of our common stock.

Results of Operations

Three and Nine months ended September 30, 2014 and 2013 (in thousands)

Revenues

We commenced our initial “soft” commercial launch of the Dario™ Smart Meter in late March 2014 with first shipments occurring during April 2014. In connection with our sales activities during the three and nine month ended September 30, 2014, we made initial shipments of Dario™ Smart Meters and test strip cartridges to our distribution partners amounting to approximately $66 and $113, respectively. In accordance with US GAAP, we did not recognize revenues from such activities. We expect to recognize our initial revenues, which we expect will be comprised of recurring orders of test strip cartridges, lancets and, in a small number of select jurisdictions, sales of Dario™ Smart Meters, during the fourth quarter of 2014 upon receipt of payment.

Ramp up of manufacturing costs

During the period of three and nine month ended September 30, 2014 we recorded costs related to ramp up of manufacturing costs in the amount of $585 and $1,611, respectively. No ramp up of manufacturing costs was recorded during the same periods in 2013. The increase is due to the commencement of our initial commercial sales efforts during March 2014, with first shipments occurring during April 2014.

Ramp up of manufacturing costs consists mainly of depreciation costs relating to our production equipment, payroll expenses to employees involved in production activities and inventory write-offs provided to cover market prices lower than cost as well as obsolete items.

Research and development expenses

Our research and development expenses decreased to $769 for the third quarter of 2014 from $1,078 for the third quarter of 2013. Research and development expenses increased to $3,209 for the first nine months of 2014 from $3,169 for the first nine months of 2013. The decrease in the third quarter of 2014 was mainly due to decrease in product engineering and software development expenses due to the increased focus in production as well as sales and marketing efforts with relation to our commencement of initial commercial sales, offset by increase in number of employees in regulation and product development teams with connection to our product localization efforts and related regulation requirements in different jurisdictions.

Research and development expenses consist mainly of payroll expenses to employees involved in research and development activities, expenses related to our Dario™ software application and related Dario™ Smart Meter, software related subcontractors and engineering expenses, depreciation and maintenance fees related to equipment and software tools used in research and development, and facilities expenses associated with and allocated to research and development activities.

Marketing and pre-production costs

Our marketing and pre-production costs decreased to $252 for the third quarter of 2014 from $763 for the third quarter of 2013. Marketing and pre-production costs decreased to $911 for the first nine months of 2014 from $1,924 for the first nine months of 2013. This decrease is mainly due to pre-production costs which were recorded during 2013. During 2014, we began to ramp up manufacturing and commenced initial shipments to distributors and therefore did not record any more pre-production costs.

Marketing and pre-production costs consist mainly of payroll expenses of sales and marketing employees, travel expenses related to such employees, trade show expenses as well as other online and offline marketing expenses. During 2013 pre-production costs were also allocated to marketing and pre-production costs and included relevant employees expenses and depreciation of our production equipment.

General and administrative expenses

Our general and administrative costs decreased to $901 for the third quarter of 2014 from $1,397 for the third quarter of 2013. General and administrative costs decreased to $3,047 for the first nine months of 2014 from $4,817 for the first nine months of 2013. This decrease was driven by cost reduction efforts, including a decrease in management compensation, overhead costs and outsourcing consulting expenses, as well as decrease in option compensation driven from decrease in our common stock market value which resulted in fair value decrease of new awards granted during the third quarter of 2014.

Our general and administrative expenses consist mainly of payroll expenses for management and employees, accounting and legal fees, expenses related to investor relations, as well as our office expenses.

Finance expenses, net

Our finance expenses, net for the third quarter of 2014 were $570 compared to $233 for the same period in 2013 or $537 for the first nine months of 2014 compared to $4,075 for the same period in 2013. Finance expenses includes mainly the results of revaluation of warrants to investors and a service providers, that are recorded as liability and presented at fair value each reporting period, issuance cost related to warrants to investors and such service provider as well as consideration granted to investors from our February 2014 Private Placement, as described below.

Net loss

Net loss for the three and nine months periods ended September 30, 2014 was $6,333 and $12,571, respectively. Net loss for the three and nine months periods ended September 30, 2013 was $3,471 and $13,985, respectively. The decrease from the nine month period ended September 30, 2014 was mainly due to income from revaluation of warrants to investors and former placement agents as described above of (3,144) versus expenses from such revaluation during 2013 amounted to $3,992 as well as decrease in operating loss. This was offset by deemed dividend expenses derived from our Series A Preferred Stock issued on September 23, 2014 (which included a beneficial conversion feature amounting to $2,977), a deemed dividend of $279 derived from the issuance of additional common stock to current investors from the February 2014 Private Placement with relation to a warrant exchange transaction which closed in September 2014, and $3,124 of finance expenses derived from the cancelation of warrants in such transaction.

Plan of Operation

We commenced a commercial launch of the free Dario^TM app in selected jurisdictions in late 2013 and commenced an initial soft launch of the full Dario^TM solution (including the software and the Smart Meter) in selected jurisdictions in March 2014 with the goal of collecting customer feedback to refine our longer-term roll-out strategy. Over time, we expect to add additional features and functionality in making Dario^TM the new standard of care in diabetes data management.

Through our Israeli subsidiary, LabStyle Innovation Ltd., our plan of operations is to continue the development of our software and hardware offerings and related technology.

For the remainder of 2014, we expect to continue with the soft launch of Dario^TM, expanding the soft launch to other jurisdictions, and to prepare for our longer-term roll-out of Dario^TM. In support of these goals, we will utilize our funds for the following activities:

	·	ramp up of mass production, marketing and distribution and sales efforts related to Dario^TM software, Smart Meters and test strips;

	·	continued product development and related activities (including costs associated with application development and data storage capabilities as well as any necessary design modifications to the various elements of the Dario^TM solution);

	·	continued work on registration of our patents worldwide;

	·	regulatory matters (including work on the regulatory approval of Dario^TM in the U.S.);

	·	professional fees associated with being a publicly reporting company; and

	·	general and administrative matters.

Liquidity and Capital Resources

Since our inception, we have generated significant losses and expect to continue to generate losses for the foreseeable future. There is no assurances that we will be able to obtain an adequate level of financing needed for our near term requirements or the long-term development and commercialization of our products. These conditions raise substantial doubt about our ability to continue as a “going concern”.

As of September 30, 2014 we had $4,170 in cash and cash equivalents. During the nine months ended September 30, 2014, we raised net proceeds in an aggregate of approximately $8,200 through private placement transactions and the exercise of outstanding warrants. We may receive funds from the exercise of other outstanding warrants in the future, but there is a risk that such warrants will not be exercised.

According to our management’s estimates, based on our budget and the initial launch of our commercial sales, we believe that we will have sufficient resources to continue our activity into March 2015. This includes a small amount of anticipated initial revenues from sales of Dario™ through distribution partners. However, if we are not unable to scale up our commercial launch Dario™ or meet our commercial sales targets (or if we are unable to generate any revenue at all), and if we are unable to obtain additional capital resources, we may be unable to continue activities beyond that time, absent a material alternations in our business plans.

Readers are advised that available resources may be consumed more rapidly than currently anticipated, resulting in the need for additional funding sooner than expected. Should this occur during the remainder of 2014 or in 2015, we will need to seek additional capital to fund (i) our manufacturing, marketing, distribution and other commercial efforts with Dario™, (ii) our efforts to obtain regulatory approvals necessary to be able to commercially launch Dario™ in new jurisdictions, and (iii) general working capital. Such funding may be unavailable to us on acceptable terms, or at all.

Off-Balance Sheet Arrangements

As of September 30, 2014, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4) of Regulation S-K.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are a smaller reporting company and therefore are not required to provide the information for this item for Form 10-Q.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Report, our Chief Executive Officer and Chief Financial Officer (the “Certifying Officers”), conducted evaluations of our disclosure controls and procedures. As defined under Sections 13a – 15(e) and 15d – 15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the term “disclosure controls and procedures” means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (“SEC”). Disclosure controls and procedures include without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including the Certifying Officers, to allow timely decisions regarding required disclosures.

Based on their evaluation, the Certifying Officers concluded that, as of September 30, 2014, our disclosure controls and procedures were designed at a reasonable assurance level and were therefore effective.

Changes in internal control over financial reporting.

There were no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2014 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on the Effectiveness of Internal Controls

Readers are cautioned that our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will necessarily prevent all fraud and material error. An internal control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our control have been detected. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any control design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.

PART II- OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

Factors that could cause our actual results to differ materially from those in this report are any of the risks described in our Annual Report on Form 10-K for the year ended December 31, 2013 filed with the SEC on March 4, 2014. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations.

The following is an update to our risk factors for our Annual Report on Form 10-K for the year ended December 31, 2013:

Given our lack of revenue and cash flow, we will need to raise additional capital, which may be unavailable to us or, even if consummated, may cause dilution or place significant restrictions on our ability to operate.

According to our management’s estimates, based on our current cash on hand and further based on our budget and the assumption that initial commercial sales will commence during our anticipated timeframes, we believe that we will have sufficient resources to continue our activities only into March 2015.

Since we might be unable to generate sufficient, if any, revenue or cash flow to fund our operations for the foreseeable future, we will need to seek additional equity or debt financing to provide the capital required to maintain or expand our operations. We may also need additional funding for developing products and services, increasing our sales and marketing capabilities, promoting brand identity, and acquiring complementary companies, technologies and assets, as well as for working capital requirements and other operating and general corporate purposes. Moreover, the regulatory compliance arising out of being a publicly registered company has dramatically increased our costs.

We do not currently have any arrangements or credit facilities in place as a source of funds, and there can be no assurance that we will be able to raise sufficient additional capital on acceptable terms, or at all. If such financing is not available on satisfactory terms, or is not available at all, we may be required to delay, scale back or eliminate the development of business opportunities and our operations and financial condition may be materially adversely affected.

If we raise additional capital by issuing equity securities, the percentage ownership of our existing stockholders may be reduced, and accordingly these stockholders may experience substantial dilution. We may also issue equity securities that provide for rights, preferences and privileges senior to those of our common stock. Given our need for cash and that equity raising is the most common type of fundraising for companies like ours, the risk of dilution is particularly significant for stockholders of our company.

Debt financing, if obtained, may involve agreements that include liens on our assets, covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, could increase our expenses and require that our assets be provided as a security for such debt. Debt financing would also be required to be repaid regardless of our operating results.

If we raise additional funds through collaborations and licensing arrangements, we may be required to relinquish some rights to our technologies or candidate products, or to grant licenses on terms that are not favorable to us.

Funding from any source may be unavailable to us on acceptable terms, or at all, particularly due to certain offering participation rights afforded to investors in a private placement which closed in February 2014 as well as preemptive rights held by the lead investor in a private placement which closed in September 2014. If we do not have sufficient capital to fund our operations and expenses, we may not be able to achieve or maintain competitiveness, which could lead to the failure of our business and the loss of your investment.

Shares eligible for future sale may adversely affect the market for our common stock.

We have a material number of shares of common stock underlying outstanding warrants and options of our company as well as underlying the shares of our Series A Convertible Preferred Stock issued in a private placement which closed in September 2014, the future sale of which could depress the price of our publicly-traded stock. As of the date of September 30, 2014: (i) 1,377,500 shares of common stock are issuable upon exercise of outstanding stock options at a weighted average exercise price of $6.81 per share; (ii) 9,922,025 shares of common stock issuable upon exercise of our outstanding warrants at a weighted average exercise price of $2.09 per share and (iii) 10,683,662 shares of common stock are issuable upon the conversion of our Series A Convertible Preferred Stock. If and when these securities are exercised or converted into shares of our common stock, our shares outstanding will increase. Such increase in our outstanding securities, and any sales of such shares, could have a material adverse effect on the market for our common stock and the market price of our common stock.

In addition, from time to time, certain of our stockholders may be eligible to sell all or some of their shares of common stock by means of ordinary brokerage transactions in the open market pursuant to Rule 144, promulgated under the Securities Act of 1933, as amended, which we refer to herein as the Securities Act, subject to certain limitations. In general, pursuant to Rule 144, after satisfying a six month holding period: (i) affiliated stockholder (or stockholders whose shares are aggregated) may, under certain circumstances, sell within any three month period a number of securities which does not exceed the greater of 1% of the then outstanding shares of common stock or the average weekly trading volume of the class during the four calendar weeks prior to such sale and (ii) non-affiliated stockholders may sell without such limitations, provided we are current in our public reporting obligations. Rule 144 also permits the sale of securities by non-affiliates that have satisfied a one year holding period without any limitation or restriction. Any substantial sale of our common stock pursuant to Rule 144 or pursuant to any resale report may have a material adverse effect on the market price of our securities.

The right of the investors in our February 2014 private placement and the lead investor in our September 2014 private placement to participate in future financings of ours could impair our ability to raise capital.

Under the securities purchase agreement with the investors in our February 2014 private placement, as amended, for a period ending on February 12, 2016, in the event that we seek to raise money through the offer and sale of debt or equity securities, we must first offer such investors a right to participate in at least 35% of the securities we propose to offer in such funding. In addition, under the securities purchase agreement with the investors in our September 2014 private placement, an affiliate of David Edery, the lead investor in such private placement, holds preemptive rights until September 23, 2016 allowing such investor to participate in future financings of our company in an amount necessary to maintain its fully-diluted percentage interest in our company. The existence of such right of participation or preemptive rights, or the exercise of such rights, may in the deter potential investors from providing us needed financing, or may deter investment banks from working with, which would have a material adverse effect on our ability to finance our company which, in turn, could lead to our inability to continue our business.

Dicilyon Consulting and Investment Ltd., an affiliate of investor David Edery, has the right to appoint up to three members of our Board of Directors, which affords such investor the potential for control over our business.

Dicilyon Consulting and Investment Ltd., an affiliate of investor David Edery (who was the lead investor in our September 2014 private placement), has the right, for so long as such investor holds 25%, 15% and 10% of our outstanding shares of common stock, such investor shall have the right to appoint, respectively, three, two or one member of our seven person Board of Directors. Mr. Edery is the sole shareholder of Dicilyon Consulting and Investment Ltd. To date, such investor has appointed one member of our Board of Directors (Rami Yehudiha), and to fully enforce such right, such investor has the right to cause up to two members of our current Board of Directors to resign and to fill the resulting vacancies with appointees of its choice. As a result, such investor has significant influence over the composition of our Board of Directors which, in turn, affords such investor the potential for material control over our business.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Not applicable.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

None.

Item 6. Exhibits.

No.		Description of Exhibit
31.1		Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS		XBRL Instance Document
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
101.SCH		XBRL Taxonomy Extension Schema Document
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Labels Linkbase Document
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: November 14, 2014		LabStyle Innovations Corp.

		By: /s/ Erez Raphael
		Name: Erez Raphael
		Title: President and Chief Executive Officer

		By: /s/ Gadi Levin
		Name: Gadi Levin
		Title: Chief Financial Officer, Secretary and Treasurer

DarioHealth Corp. - FORM 10-Q - November 14, 2014

Attached files

DarioHealth Corp. Reports