Why Is Penny Stock OpGen Trading Higher On Tuesday?

Tuesday, OpGen Inc OPGN shares are trading higher after the company entered into a securities purchase agreement with a private investor, David Lazar, to acquire 3 million shares of Series E Convertible Preferred Stock at $1.00 per share for aggregate gross proceeds of $3.0 million.

The shares are trading higher on a strong session volume of 1.42 million compared to an average volume of 288.651K, as per data from Benzinga Pro.

The company will use the proceeds to repay and settle outstanding indebtedness and liabilities for other general corporate and operating purposes.

On March 25, 2024, Mr. Lazar paid $200,000 at the initial closing of the transactions in exchange for 200,000 Series E Preferred Stock shares. 

Subject to the satisfaction of certain additional closing conditions, Mr. Lazar will pay an additional $200,000 on or before April 8, 2024, and the balance of $2.6 million will be paid no later than May 1, 2024. 

Each Series E Preferred Stock share is convertible into 24 shares of the company’s common stock. 

In connection with the transactions, Mr. Lazar was also appointed to the Board of Directors of OpGen and, following closing, will be appointed CEO. 

In addition, effective as of the initial closing, each of the prior members of the company’s board of directors resigned, and Oliver Schacht resigned as CEO. 

In connection with the foregoing transaction, OpGen entered into settlement agreements with the European Investment Bank and Curetis, the company’s subsidiary and Curetis’ trustee in insolvency, under which the company settled outstanding liabilities amongst the parties. 

Under the settlement agreements and the securities purchase agreement with Mr. Lazar, following the closing of the securities purchase agreement, the company will pay $2 million of the proceeds from the financing to settle all outstanding debt of the company to each of EIB and Curetis.

Price Action: OPGN shares are up 50.1% at $0.71 on the last check Tuesday.