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Private Investor Buys $3M of OpGen Preferred Stock; New CEO Named

NEW YORK – OpGen announced Monday that it has entered a securities purchase agreement with private investor David Lazar to acquire 3 million shares of the firm's Series E Convertible Preferred stock for $1.00 per share. 

The $3.0 million in aggregate proceeds will be used to repay and settle the firm's outstanding indebtedness and liabilities and for general corporate and operating purposes, OpGen said in a statement. On Monday, Lazar paid an initial $200,000 for 200,000 shares of preferred stock. Lazar will pay an additional $200,000 on or before April 8, subject to the satisfaction of certain additional closing conditions. The final $2.6 million will be paid no later than May 1, OpGen said. 

Lazar will become OpGen's CEO after the deal's completion, replacing Oliver Schacht, who will continue as executive VP of corporate development. Lazar was also appointed to the firm's board of directors. The rest of the company's prior board of directors have resigned, replaced by Avraham Ben-Tzvi, Matthew McMurdo, and David Natan, who were appointed to the board, effective as of the initial closing on Monday.

Rockville, Maryland-based OpGen also entered into settlement agreements with the European Investment Bank (EIB), as well as OpGen subsidiary Curetis and Curetis' trustee in insolvency to settle outstanding liabilities. After the closing of the securities purchase agreement, the company will pay $2.0 million of the proceeds from the financing to settle all outstanding debt of the company to EIB and Curetis. 

In December, the company disclosed in documents filed with the US Securities and Exchange Commission that Curetis was in default of its contract with the EIB after failing to repay certain outstanding debts. 

"With Curetis and Ares Genetics businesses and assets being sold by the respective trustees in Germany and Austria to strategic acquirors, this financing transaction provides an opportunity for OpGen to settle its outstanding liabilities with its major creditors," Schacht said in a statement. "We believe the transaction also offers future opportunities for OpGen stockholders to participate in possible future strategic transactions under the leadership of David Lazar and the new members of the board." 

Curetis and Ares Genetics filed for bankruptcy in Europe in November. Last month, OpGen retained its listing on the Nasdaq after requesting a hearing with the stock exchange. It has until June 3 to regain compliance with the exchange's minimum bid price requirement.