Item 1.01 Entry into a Definitive Material Agreement
As previously reported, on November 23, 2020, OpGen, Inc. (the "Company")
entered into a Securities Purchase Agreement (the "Purchase Agreement") with an
institutional investor (the "Holder"), pursuant to which the Company issued to
the Investor, securities of the Company, including warrants (the "Existing
Warrants") to purchase up to 4,842,615 shares of common stock, par value $0.01
per share (the "Common Stock"), of the Company (the "Warrant Shares"). The
Existing Warrants were exercisable six months after their issuance at an
exercise price of $1.94 per share and expire on the fifth and a half year
anniversary of the date of issuance.
On March 9, 2021, the Company entered into a Warrant Exercise Agreement (the
"Exercise Agreement") with the Holder. Pursuant to the Exercise Agreement, in
order to induce the Holder to exercise all of the remaining 4,842,615
outstanding Existing Warrants for cash, pursuant to the terms of and subject to
beneficial ownership limitations contained in the Existing Warrants, the Company
agreed to issue to the Holder, new warrants (the "New Warrants") to purchase
0.65 shares of Common Stock for each share of Common Stock issued upon such
exercise of the remaining 4,842,615 outstanding Existing Warrants pursuant to
the Exercise Agreement or an aggregate of 3,147,700 New Warrants. The terms of
the New Warrants will be substantially similar to those of the Existing
Warrants, except that the New Warrants will have an exercise price of $3.56. The
New Warrants will be immediately exercisable and will expire five years from the
date of the Exercise Agreement. The Holder will pay an aggregate of $314,770 to
the Company for the purchase of the New Warrants. The Company expects to receive
aggregate gross proceeds before expenses of approximately $9.71 million from the
exercise of all of the remaining 4,842,615 outstanding Existing Warrants held by
the Holder and the payment of the purchase price for the New Warrants.
Pursuant to the Exercise Agreement, the Holder has agreed, until the date that
no Existing Warrants are held by such Holder (i) not to purchase any shares of
Common Stock, other than pursuant to exercises of the Existing Warrants and (ii)
not to transfer any Existing Warrants other than to transferees who assume the
obligations under the Exercise Agreement.
The Warrant Shares were registered for resale pursuant to a registration
statement on Form S-3 (File No. 333-250983), filed with the Securities and
Exchange Commission (the "SEC") under the Securities Act of 1933, as amended
(the "Securities Act"), on November 25, 2020, which became effective on December
4, 2020. Pursuant to the terms of the Exercise Agreement, the Company has agreed
to file a registration statement to register for resale the shares of Common
Stock underlying the New Warrants within 45 days of the final exercise of the
Existing Warrants.
In connection with the Exercise Agreement, the Company entered into a financial
advisory agreement (the "Letter Agreement") with A.G.P./Alliance Global Partners
("A.G.P."), pursuant to which A.G.P. acted as exclusive financial advisor to the
Company in this transaction and will receive a cash fee of $300,000 upon full
cash exercise of the Existing Warrants. As additional compensation, A.G.P. will
receive a cash fee equal to $200,000 upon the cash exercise in full of the New
Warrants.
Pursuant to the Exercise Agreement, the Company agreed that through May 8, 2021,
subject to certain exceptions, not to directly or indirectly, offer, sell, grant
any option to purchase, or otherwise dispose of (or announce any offer, sale,
grant or any option to purchase or other disposition of) any of its or its
subsidiaries' debt, equity or equity equivalent securities.
The description of terms and conditions of the New Warrants, the Exercise
Agreement, and the Letter Agreement set forth herein do not purport to be
complete and are qualified in their entirety by reference to the full text of
the form of New Warrants, the form of Exercise Agreement, and the Letter
Agreement which are attached hereto as Exhibits 4.1, 10.1, and 10.2,
respectively, and are incorporated by reference herein.
Item 3.02 Unregistered Sales of Equity Securities
The description of the Existing Warrants and the New Warrants set forth under
Item 1.01 is incorporated herein by reference.
The Company will issue the New Warrants and the shares of Common Stock
underlying the New Warrants to the Holder in reliance on the exemption from
registration provided for under Section 4(a)(2) of the Securities Act. The
Company relied on this exemption from registration for private placements based
in part on the representations made by the Holder, including the representations
with respect to the Holder's status as an "accredited investor," as such term is
defined in Rule 501(a) of the Securities Act, and the Holder's investment
intent.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
4.1 Form of New Warrant.
10.1 Form of Warrant Exercise Agreement, dated as of March 9, 2021, by and
between OpGen, Inc. and the Holder.
10.2 Letter Agreement, dated as of March 9, 2021, by and between
A.G.P./Alliance Global Partners and OpGen, Inc.
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