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OpGen, Inc.

Retention Plan for Executives

(Effective September 21, 2018)

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Table of Contents

Article 1.	Establishment and Term of the Plan		1
	1.1	Establishment of the Plan	1
	1.2	Initial Term	1
	1.3	Successive Periods	1
	1.4	Change in Control Renewal	1
Article 2.	Definitions		2
Article 3.	Retention Benefits		6
	3.1	Issuance of Units	6
	3.2	Payment of Change-in-Control Benefits	7
	3.3	Coordination with Release and Delay Required by Code Section 409A	7
	3.4	Timing and Method of Payment	8
Article 4.	Other Agreements		8
Article 5.	Covenants and Agreements		8
	5.1	Covenants	8
	5.2	Assistance with Claims	9
Article 6.	Certain Change in Control Payments		9
Article 7.	Legal Fees and Notice		10
	7.1	Payment of Legal Fees	10
	7.2	Notice	10
Article 8.	Successors and Assignment		10
	8.1	Successors to the Company	10
	8.2	Assignment by the Executive	10
Article 9.	Plan Administration		10
	9.1	Plan Administrator	10
	9.2	Records, Reporting and Disclosure	10
	9.3	Discretion	11
Article 10.	Claims		12
Article 11.	Miscellaneous		12
	11.1	Indemnification	12
	11.2	Employment Status	12
	11.3	Entire Plan	12
	11.4	Severability	12
	11.5	Tax Withholding	12
	11.6	Beneficiaries	12
	11.7	Payment Obligation Absolute	13
	11.8	Contractual Rights to Benefits	13
	11.9	Modification	13
	11.10	Gender and Number	13
	11.11	Controlling Law	13

OPGEN, INC.
RETENTION PLAN FOR EXECUTIVES

The Company considers the establishment and maintenance of a sound and vital management team to be essential to protecting and enhancing the best interests of the Company and its stockholders.  In this connection, the Company recognizes that, as is the case with many publicly held corporations, the possibility of a Change in Control may arise and that such possibility, and the uncertainty and questions which it may raise among management, may result in the departure or distraction of management personnel to the detriment of the Company and its stockholders.

Accordingly, the Board has determined that appropriate steps should be taken to reinforce and encourage the continued attention and dedication of members of the Company's management to their assigned duties without distraction in circumstances arising from the possibility of a Change in Control of the Company.

 

 

Whenever used in this Plan, the following terms shall have the meanings set forth below.

 

 

In addition, if a Change in Control constitutes a payment event under this Plan that provides for the deferral of compensation and is subject to Code Section 409A, the transaction or event described in subsection (i), (ii) or (iii) with respect to such award (or portion thereof) must also constitute a "change in control event," as defined in Treasury Regulation Section 1.409A-3(i)(5) to the extent required by Code Section 409A.

The Board shall have full and final authority, which shall be exercised in its sole discretion, to determine conclusively whether a Change in Control has occurred pursuant to the above definition, and the date of the occurrence of such Change in Control and any incidental matters relating thereto; provided that any exercise of authority in conjunction with a determination of whether a Change in Control is a "change in control event" as defined in Treasury Regulation Section 1.409A-3(i)(5) shall be consistent with such regulation.  If the Board does not consist of at least a majority of directors in office at the Effective Date, or successors nominated by the then-existing Board (the "Continuing Directors"), the determination as to whether a Change in Control has occurred shall be made by the Continuing Directors only.

 

 

 

 

 

Amounts paid into escrow and contingent payments in connection with any Change in Control transaction, as the case may be, will be included as part of the economic value.  Any escrow agreement shall provide that compensation paid under issued Units shall be paid to the Executives at or prior to the payment of such amounts to the Company or its stockholders.  Any compensation arising from contingent consideration shall be made when the contingent consideration is paid to the Company or its stockholders.  Transaction Value also includes the aggregate amount of any (A) dividends or other distributions declared by the Company with respect to its stock after the date hereof, other than normal recurring cash dividends in amounts not materially greater than currently paid, and (B) amounts paid by the Company to repurchase any securities of the Company outstanding on the date hereof.

If any portion of the Change in Control transaction is paid in the form of securities, the value of such securities, for purposes of calculating the Transaction Value, will be determined as set forth in the definitive agreement or, if not so set forth, by the average of the last sales prices for such securities on the five trading days ending five days prior to the consummation of the Change in Control transaction.

Article 3. Retention Benefits

 

 

 

 

 

Nothing in this Plan shall diminish any benefits paid to the Executive under an existing employment or severance agreement with the Company.

 

 

Notwithstanding any provision of the Plan to the contrary, if any payments or benefits an Executive would receive from the Company under the Plan or otherwise in connection with the Change in Control (the "Total Payments") (a) constitute "parachute payments" within the meaning of Code Section 280G, and (b) but for this Article 6, would be subject to the excise tax imposed by Code Section 4999, then such Executive will be entitled to receive either (i) the full amount of the Total Payments or (ii) a portion of the Total Payments having a value equal to One Dollar ($1) less than three (3) times such individual's "base amount" (as such term is defined in Code Section 280G(b)(3)(A)), whichever of (i) and (ii), after taking into account applicable Federal, state, local income and employment taxes and the excise tax imposed by Code Section 4999, results in the receipt by such employee on an after-tax basis, of the greatest portion of the Total Payments.  Any determination required under this Article 6 shall be made in writing by the Company's independent certified public accountants appointed prior to any change in ownership (as defined under Code Section 280G(b)(2)) or tax counsel selected by such accountants (the "Accountants"), whose determination shall be conclusive and binding for all purposes upon the applicable Executive and the Company.  For purposes of making the calculations required by this Article 6, the Accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good-faith interpretations concerning the application of Code Sections 280G and 4999.  If there is a reduction pursuant to this Article 6 of the Total Payments to be delivered to the applicable Executive, the payment reduction contemplated by the preceding sentence shall be implemented by determining the Parachute Payment Ratio (as defined below) for each "parachute payment" and then reducing the "parachute payments" in order beginning with the "parachute payment" with the highest Parachute Payment Ratio.  For "parachute payments" with the same Parachute Payment Ratio, such "parachute payments" shall be reduced based on the time of payment of such "parachute payments," with amounts having later payment dates being reduced first.  For "parachute payments" with the same Parachute Payment Ratio and the same time of payment, such "parachute payments" shall be reduced on a pro rata basis (but not below zero) prior to reducing "parachute payments" with a lower Parachute Payment Ratio.  For purposes hereof, the term "Parachute Payment Ratio" shall mean a fraction the numerator of which is the value of the applicable "parachute payment" for purposes of Code Section 280G and the denominator of which is the actual present value of such payment.

 

 

 

 

9.3       Discretion. Any decisions, actions or interpretations to be made under the Plan by the Committee shall be made in its sole and absolute discretion, subject to the terms of the Plan and applicable law, and need not be uniformly applied and such decisions, actions or interpretations shall be final, binding and conclusive upon all parties, with respect to denied claims for Change in Control Benefits. Not in limitation, but in amplification of the foregoing and of the authority conferred upon the Committee, the Company specifically intends that the Committee and its duly authorized delegates have the greatest permissible discretion to construe the terms of the Plan and to determine all questions concerning eligibility, participation, and benefits. The decisions by the Committee or any delegates shall be conclusive and binding, and any interpretation, determination, or other action by them is intended to be subject to the most deferential standard of review. Such standard of review is not to be affected by any real or alleged conflict of interest on the part of the Committee or its delegates. In addition to the duties and powers described hereunder and elsewhere in this Plan, the Committee or its delegate is specifically given the discretionary authority and such powers as are necessary for the proper administration of the Plan, including, but not limited to, the following:  (i) to resolve ambiguities or inconsistencies; (ii) to supply omissions and the like; (iii) to make determinations, grants, or denials of the amount, manner, and time of payment of any Change in Control Benefits under the terms of the Plan; (iv) to authorize its agents or delegates to execute or deliver any instrument or make payments on the Committee's behalf or with respect to the Plan; (v) to select and retain counsel, service providers and vendors, employ agents, and provide for such clerical, accounting, actuarial, legal, consulting and/or claims processing services as it deems necessary or desirable to assist the Committee in the administration of the Plan; (vi) to prepare and distribute, in such manner as the Committee determines to be appropriate, summary plan descriptions and other information explaining the Plan; (viii) to furnish the Company, upon request, such annual reports with respect to the administration of the Plan as the Committee deems reasonable and appropriate; (ix) to receive, review and keep on file, as the Committee deems necessary or appropriate, reports of Plan payments and reports of disbursements for expenses; and (x) in general to decide and/or settle questions and disputes, and all such authorizations, interpretations, determinations, decisions and settlements shall be  final and binding for purposes of the Plan.

 

Notwithstanding any of the foregoing, if a dispute arises with respect to the payment of Change in Control Benefits after a Change in Control, the standard of review shall be de novo in any court proceeding.

 

 

If an Executive believes that he is entitled to benefits under the Plan which are not being paid, the Executive may submit a written claim for payment to the Committee.  The Executive must make an initial claim within sixty (60) days of termination of employment in order to be eligible for benefits.  Any claim for benefits must be in writing, addressed to the Committee and must be sufficient to notify the Committee of the benefit being claimed.  If the claim is denied, the Committee shall, within a reasonable period of time, provide the Executive with a written notice of denial.  The notice will include the specific reasons for denial, the provisions of the Plan on which the denial is based, and the procedure for a review of the denied claim.  Where appropriate, it will also include a description of any additional material or information necessary to complete or perfect the claim and an explanation of why that material or information is necessary.  The Executive may request in writing a review of a claim denied by the Committee and may review pertinent documents and submit issues and comments in writing to the Committee.  The Committee shall provide the Executive with a written decision upon such request for review of a denied claim.  The decision of the Committee upon such review shall be final; provided, however, the Executive shall have the right to pursue adjudication of a claim in a court of competent jurisdiction once this appeal process is complete.