At-the-Market Offerings

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ATM Offering

At-the-market offerings provide issuers with several advantages over traditional follow-on offerings, including the following:

• Minimal market impact: Issuers can quickly raise capital by selling newly issued shares into the natural trading flow of the market, without having to market and/or announce the offering. As a result, shares are able to “trickle” into the market, without impacting the issuer’s stock price. Investors cannot short the issuer’s stock in advance of the offering since the timing of any particular takedown is not known.

• Flexibility: Sales can be effected on an agency or principal basis, and the terms of each sale are agreed upon between the issuer and the agent, including its timing and size, at the issuer’s discretion. This enables an issuer to match its capital structure to its ongoing needs. For example, an issuer can implement a limit price below which sales will not occur and/or a percentage limitation on daily sales to reduce downward price pressure on its stock, as well as dilution.

• Low cost: The distribution costs for at-the-market offerings (usually 1-3%) typically are less than for traditional follow-on offerings, and the absence of an issuer commitment to sell means that there will be no sales below acceptable share prices.

• Minimal management involvement: At-the-market offerings require no “roadshows” and involve only limited prospectus preparation and delivery requirements.                  

    
 

Opexa Therapeutics(NASDAQ:OPXA)

At-the-Market Offering of 2,000 Shares

JANUARY 5, 2011

EG&S acted as counsel to Rodman & Renshaw LLC

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