SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
September 12, 1997
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EPITOPE, INC.
(Exact name of Registrant as specified in charter)
Oregon
(State or other jurisdiction of incorporation)
1-10492
(Commission File No.)
93-0779127
(IRS Employer Identification No.)
8505 S.W. Creekside Place
Beaverton, Oregon 97008
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(503) 641-6115
<PAGE>
Item 5. Other Events.
On September 12, 1997, Epitope, Inc. ("Epitope") notified holders of
warrants to purchase approximately 2 million shares of Epitope common stock that
it will extend the deadline to exercise the warrants to September 30, 2000. The
warrants, which are exercisable at prices ranging from $16 to $20 per share,
were previously set to expire September 30, 1997.
As previously announced, Epitope's board of directors has approved a
proposal to spin off Agritope, Inc. Beginning 10 days after the spin-off,
Epitope will allow exercise of the warrants at a reduced purchase price. The
reduced purchase price will be equal to 110 percent of the average closing price
of Epitope common stock during the five trading days beginning on the date of
the spin-off.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Not applicable.
(b) Not applicable.
(c) Exhibits.
The exhibits filed herewith are listed in the exhibit index following the
signature page of this report.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
EPITOPE, INC.
Dated: September 12, 1997 By: /s/ Gilbert N. Miller
Gilbert N. Miller
Executive Vice President and Chief
Financial Officer
<PAGE>
EXHIBIT INDEX
4.1 Notice to warrantholders and current form of warrant certificate for
warrants issued in September 1991 offering.
4.2 Notice to warrantholders and current form of warrant certificate for
warrants issued in December 1992 offering.
4.3 Notice to warrantholders and current form of warrant certificate for
warrants issued in July 1993 offering.
4.4 Notice to warrantholders and current form of warrant certificate for
warrants issued in August 1993 offering.
[Form of Notice -- 1991 Warrants]
NOTICE TO WARRANTHOLDERS
THE WARRANTS REFERRED TO BELOW AND THE SHARES OF COMMON STOCK UNDERLYING THE
WARRANTS HAVE NOT BEEN REGISTERED FOR ISSUANCE TO THE WARRANTHOLDERS UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED ("1933 ACT"), AND MAY NOT BE
OFFERED, SOLD, TRANSFERRED, PLEDGED, OR OTHERWISE DISPOSED OF, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO A U. S. PERSON (AS SUCH
TERMS ARE DEFINED IN REGULATION S UNDER THE 1933 ACT), NOR MAY THE WARRANTS BE
EXERCISED IN THE UNITED STATES OR BY OR ON BEHALF OF A U. S. PERSON, UNLESS (i)
THE TRANSACTION IS REGISTERED UNDER THE 1933 ACT AND ANY APPLICABLE SECURITIES
LAWS OF ANY STATE, TERRITORY OR POSSESSION OF THE UNITED STATES OR THE DISTRICT
OF COLUMBIA ("STATE ACT"), OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE 1933
ACT OR ANY APPLICABLE STATE ACT IS AVAILABLE AND THE ISSUER HAS RECEIVED AN
OPINION OF COUNSEL TO SUCH EFFECT REASONABLY SATISFACTORY TO IT.
[Name and Address of Warrantholder]
Reference is made to the warrants ("Warrants") to purchase common
stock, no par value ("Common Stock"), of Epitope, Inc. (the "Company")
originally issued by the Company on September 26, 1991, and the related Warrant
Agreements ("Warrant Agreements") dated as of the same date containing the terms
of the Warrants. Capitalized terms used and not otherwise defined herein have
the same meanings as in the Warrant Agreements.
The Expiration Date for the Warrants, as previously extended, is
September 30, 1997. The Company hereby further extends the Expiration Date until
September 30, 2000.
The Company intends to effect a spin-off of Agritope, Inc.
("Agritope") by making a dividend distribution (the "Distribution") of Agritope
common stock to the Company's shareholders. Subject to and effective ten days
after occurrence of the Distribution, the Company will permit exercise of the
Warrants at a reduced exercise price per share equal to 110 percent of the
average closing price of the Common Stock on The Nasdaq Stock Market for the
five consecutive trading days beginning on the date of the Distribution.
Warrantholders will not receive Agritope common stock in the
Distribution with respect to shares of Common Stock issued upon exercise of
Warrants after the record date for the Distribution.
Please attach a copy of this notice to your Warrant Agreement.
Dated: September 12, 1997.
EPITOPE, INC.
By:-----------------------------------------
Executive Vice President and Chief
Financial Officer
<PAGE>
THESE WARRANTS AND THE SHARES OF COMMON STOCK UNDERLYING THESE WARRANTS MAY NOT
BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO A U.S. PERSON (AS SUCH
TERMS ARE DEFINED IN REGULATION S UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OF THE UNITED STATES OF AMERICA (THE "1933 ACT")), NOR MAY THESE WARRANTS BE
EXERCISED IN THE UNITED STATES OR BY OR ON BEHALF OF A U.S. PERSON, UNLESS (i)
THE TRANSACTION IS REGISTERED UNDER THE 1933 ACT AND ANY APPLICABLE SECURITIES
LAWS OF ANY STATE, TERRITORY OR POSSESSION OF THE UNITED STATES OF AMERICA OR
THE DISTRICT OF COLUMBIA ("STATE ACT"), OR (ii) AN EXEMPTION FROM REGISTRATION
UNDER THE 1933 ACT OR ANY APPLICABLE STATE ACT IS AVAILABLE AND THE ISSUER HAS
RECEIVED AN OPINION OF COUNSEL TO SUCH EFFECT REASONABLY SATISFACTORY TO IT.
VOID AFTER 5 P.M., PACIFIC TIME, ON SEPTEMBER 30, 2000,
WARRANTS TO PURCHASE COMMON STOCK
Warrant No. ___ ___ Warrants
EPITOPE, INC.
THIS CERTIFIES THAT
[Name of warrantholder]
or registered assigns, is the registered holder of the number of Warrants
("Warrants") set forth above. Each Warrant entitles the holder thereof (the
"Warrantholder") to purchase from Epitope, Inc., a corporation incorporated
under the laws of the state of Oregon ("Company"), United States of America, one
fully paid and nonassessable share of common stock, no par value, of the Company
("Common Stock") upon presentation and surrender of this Warrant Agreement with
the instructions for the registration and delivery of Common Stock filled in, at
any time prior to 5 P.M., Pacific time, on September 30, 2000, at the corporate
offices of the Company at 8505 S.W. Creekside Place, Beaverton, Oregon 97008,
United States of America, or at such other address as may be specified by the
Company pursuant to Section , accompanied by payment of the Exercise Price (as
defined herein) and any applicable taxes, either in cash or by certified or
official bank check, payable in lawful money of the United States of America to
the order of the Company.
Section 1. Exercise Price. Each Warrant entitles the Warrantholder to
purchase one share of Common Stock for U.S. $______ (the "Exercise Price"),
subject to adjustment as provided herein.
Section 2. Expiration. All Warrants not theretofore exercised shall expire
at 5 p.m., Pacific time, on September 30, 2000 (the "Expiration Date").
Section 3. Adjustments of Number and Kind of Shares Purchasable and
Exercise Price. The number and kind of securities or other property purchasable
upon exercise of a Warrant shall be subject to adjustment from time to time upon
the occurrence, after the date hereof, of the following events:
3.1 If the outstanding shares of the Company's Common Stock are
divided into a greater number of shares or a dividend in stock is paid on
the Common Stock, the number of shares of Common Stock issuable on
exercise of the Warrants shall be proportionately increased and the
Exercise Price in effect immediately prior to such subdivision or at the
record date of such dividend shall, simultaneously with the effectiveness
of such subdivision or immediately after the record date of such dividend,
be proportionately reduced; and, conversely, if the outstanding shares of
Common Stock are combined into a smaller number of shares of Common Stock,
the
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<PAGE>
number of shares of Common Stock issuable upon exercise of the Warrants
shall be proportionately reduced and the Exercise Price in effect
immediately prior to such combination shall, simultaneously with the
effectiveness of such combination, be proportionately increased. The
increases and reductions provided for in this subsection 3.1 shall be made
with the intent and, as nearly as practicable, the effect that neither the
percentage of the total equity of the Company issuable on exercise of the
Warrants nor the price payable for such percentage upon such exercise
shall be affected by any event described in this subsection 3.1.
3.2 No adjustment of the Exercise Price will be made if the amount
of the adjustment is less than one cent per share, but in that case any
adjustment that would otherwise be required to be made will be carried
forward and will be made at the time of and together with the next
adjustment of the Exercise Price which, together with any adjustment
carried forward, amounts to one cent per share or more.
3.3 In case of any change in the Common Stock of the Company through
merger, consolidation, reclassification, reorganization, partial or
complete liquidation, or other change in the capital structure of the
Company (not including a combination of shares or the issuance of
additional shares of Common Stock by the Company by stock split or stock
dividend), then, as a condition of the change in the capital structure of
the Company, provision shall be made so that the holder of this Warrant
Agreement will have the right thereafter to receive upon the exercise of
the Warrants the kind and amount of shares of stock or other securities or
property to which such holder would have been entitled if, immediately
prior to such merger, consolidation, reclassification, reorganization,
recapitalization, or other change in the capital structure, such holder
had held the number of shares of Common Stock issuable upon the exercise
of the Warrants. In any such case, appropriate adjustment shall be made in
the application of the provisions set forth herein with respect to the
rights and interest thereafter of the Warrantholder, to the end that the
provisions set forth herein shall thereafter be applicable, as nearly as
reasonably may be, in relation to any shares of stock or other property
thereafter deliverable upon the exercise of the Warrants. The Company will
not permit any change in its capital structure to occur unless the issuer
of the shares of stock or other securities to be received by the holder of
this Warrant Agreement, if not the Company, agrees to be bound by and
comply with the provisions of this Warrant Agreement.
3.4 When any adjustment is required to be made in the number of
shares of Common Stock, other securities, or the property purchasable upon
exercise of the Warrants, the Company shall promptly determine the new
number of shares or other securities or property purchasable upon exercise
of the Warrants and (i) prepare and retain on file a statement describing
in reasonable detail the method used in arriving at the new number of
shares or other securities or property purchasable upon exercise of the
Warrants and (ii) cause a copy of such statement to be mailed to the
Warrantholder within thirty (30) days after the date when the event giving
rise to the adjustment occurred.
3.5 No fractional shares of Common Stock or other securities will be
issued in connection with the exercise of any Warrants, but the Company
shall pay, in lieu of fractional shares, a cash payment therefor on the
basis of the closing price on a national securities exchange on the day
immediately prior to exercise or if the Common Stock or other securities
are not traded on a national securities exchange on such day, on the basis
of the fair market value thereof as determined by the board of directors
of the Company, which determination shall be conclusive.
3.6 Notwithstanding anything herein to the contrary, there shall be
no adjustment made hereunder on account of the sale and issuance of the
shares of Common Stock or other securities purchasable upon exercise of
the Warrants.
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<PAGE>
Section 4. Rights of Warrantholder as Shareholder. No holder of this
Warrant Agreement shall, as such, be entitled to vote, receive dividends, or be
deemed the holder of Common Stock or any other securities of the Company that
may at any time be issuable on the exercise hereof for any purpose whatever, nor
shall anything contained herein be construed to confer upon the holder of this
Warrant Agreement, as such, any of the rights of a shareholder of the Company or
any right to vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof or give or withhold consent to any corporate
action (whether upon any matter submitted to shareholders at any meeting thereof
or otherwise) including, without limitation, giving or withholding consent to
any merger, recapitalization, issuance of stock, reclassification of stock,
change of par value or change of stock to no par value, consolidation or
conveyance, or to receive notice of meetings or other actions affecting
shareholders or to receive dividends or subscription rights or other
distributions.
Section 5. Payment of Certain Taxes and Charges. The Company shall not be
required to issue or deliver any certificate for shares of Common Stock or other
securities upon the exercise of Warrants evidenced by this Warrant Agreement or
to register the transfer of the Warrants evidenced hereby until any applicable
transfer tax and any other taxes or governmental charges that the Company may be
required by law to collect in respect of such exercise or transfer shall have
been paid, such tax being payable by the holder of this Warrant Agreement at the
time of surrender for exercise or transfer.
Section 6. Registration.
6.1 Registration Statement. The Company has prepared a registration
statement on Form S-3 (the "Registration Statement") under the 1933 Act
with respect to transfer by the Warrantholder of the Warrants covered by
this Warrant Agreement and the re-sale by the Warrantholder of the shares
of Common Stock issued or issuable upon exercise of this Warrant Agreement
(the "Warrant Shares"). A soon as practicable after the original issue
date of this Warrant Agreement (the "Original Issue Date"), the Company
shall file the Registration Statement with the United States Securities
and Exchange Commission and shall use its best efforts to cause the
Registration Statement to become effective under the 1933 Act as promptly
as practicable after the Original Issue Date. If required by applicable
law, the Company shall furnish to the initial Warrantholder such
reasonable number of copies of a prospectus, in conformity with the
requirements of the 1933 Act, and any amendments or supplements thereto
and such other documents as such Warrantholder may reasonably request in
order to facilitate the disposition of the Warrants and Warrant Shares
(the "Securities") after the Registration Statement has been declared
effective. The Company shall use reasonable efforts (i) to notify the
initial Warrantholder when a prospectus relating to the Securities is
required to be delivered under the 1933 Act, (ii) to notify the initial
Warrantholder of the happening of any event as a result of which the
prospectus included in the Registration Statement, as then in effect,
includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, (iii) to promptly file such amendments and supplements as may be
required on account of such event, and (iv) to use its best efforts to
cause each such amendment and supplement to become effective. The initial
Warrantholder shall not effect sales of the Securities after receipt of
notice from the Company that any such amendment or supplement is required
on account of any such event, until the amendment or supplement becomes
effective. The Company's obligations under this Section shall expire five
years after the Original Issue Date or on any earlier date by which the
initial Warrantholder has sold the Securities or on and after which the
initial Warrantholder may sell the Securities without registration under
the 1933 Act.
6.2 Warrantholder Information. It shall be a condition precedent to
the obligations of the Company to take any action pursuant to this Section
that Warrantholder shall furnish to the Company such information regarding
itself, the Securities, and the intended method of disposition of the
Securities as the Company shall reasonably request.
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<PAGE>
6.3 Expenses of Registration. The Company shall pay all expenses
(other than underwriting discounts and commissions, transfer taxes, if
any, and fees and disbursements of counsel to the Warrantholder) incurred
in connection with the Registration Statement.
Section 7. Transfer and Exchange.
7.1 Transfer. This Warrant Agreement is transferable on the registry
books of the Company subject to the restrictions on the first page hereof
and in Section . The Company may deem and treat the person in whose name
this Warrant Agreement is registered as the absolute owner hereof
(notwithstanding any notation of ownership or other writing thereon made
by anyone other than the Company) for all purposes whatever, and the
Company shall not be affected by any notice to the contrary.
7.2 Exchange. Subject to the provisions of Section , this Warrant
Agreement is exchangeable at the principal office of the Company for
Warrant Agreements to purchase the same aggregate number of shares of
Common Stock as are purchasable hereunder, each new Warrant Agreement to
represent the right to purchase such number of shares as the Warrantholder
shall designate at the time of such exchange.
7.3 Securities Act of 1933. The Warrantholder, by acceptance hereof,
agrees that this Warrant Agreement and the shares of Common Stock issued
or issuable upon exercise of this Warrant Agreement may not be offered or
sold except in compliance with the 1933 Act. The Warrantholder consents to
the Company's making a notation on its records and on the certificates for
any shares of Common Stock issued upon exercise hereof in order to
implement such restriction on transferability.
7.4 Minimum Warrant Agreement Amount. Notwithstanding the provisions
of Section 7.1 and Section 7.2, the Company shall not be required to issue
a Warrant Agreement for Warrants covering less than 1,000 shares of Common
Stock, except in the case of a partial exercise by the Warrantholder of
this Warrant Agreement that leaves Warrants exercisable to purchase less
than 1,000 shares that are to remain registered in the name of the
exercising Warrantholder, and any subsequent partial exercise, transfer,
or exchange of such Warrant Agreement.
Section 8. Lockup Agreement. The Warrantholder, if requested by the
Company and an underwriter of the Company's securities, shall agree not to sell
or otherwise transfer or dispose of any Warrant Shares for a specified period of
time (not to exceed 90 days) following the effective date of a registration
statement pursuant to which the Company proposes to sell its securities to the
public generally; provided, however, that all executive officers and directors
of the Company enter into similar agreements.
Section 9. Notices. All notices and other communications given pursuant to
this Warrant Agreement shall be in writing. Notices to the Company shall be
deemed to have been given when received by the Company. Notices to the
Warrantholder shall be deemed to have been given when personally delivered or,
if mailed, upon deposit in the United States mails, postage prepaid, addressed
at the address provided to the Company and set forth in the Company's registry
books. Notices mailed to the Warrantholder shall be sent via airmail if the
Warrantholder's address is outside the United States. Notices to the Company
should be addressed as follows:
Epitope, Inc.
8505 S.W. Creekside Place
Beaverton, Oregon 97008
Attention: President
With a copy (which shall not constitute notice) to:
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<PAGE>
Miller, Nash, Wiener, Hager & Carlsen LLP
3500 U. S. Bancorp Tower
111 S.W. Fifth Avenue
Portland, Oregon 97204
Attention: Erich W. Merrill, Jr.
Such addresses for notices may be changed by any party by notice to the other
party pursuant to this Section 9.
Section 10. Amendment. This Warrant Agreement may be amended only by an
instrument in writing signed by the Company and the Warrantholder.
Section 11. Law Governing. This Warrant Agreement shall be construed and
enforced in accordance with and governed by the laws of the state of Oregon,
United States of America, applicable to contracts to be performed in such state
between residents thereof, without regard to the conflicts of law provisions of
such state.
Dated as of ------------------.
EPITOPE, INC.
By------------------------------------------
Attest:
By------------------------------------------
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<PAGE>
ELECTION TO EXERCISE WARRANT
[NOTE: Unless the Warrant Shares have been registered under the 1933 Act
or are exempt from registration thereunder, this Election to Exercise
Warrant must be executed, and the Warrant Shares must be delivered,
outside of the United States of America, its territories and possessions.]
To: Epitope, Inc.
8505 Creekside Place
Beaverton, Oregon 97008
United States of America
The undersigned hereby exercises the within Warrant Agreement for
________ shares of the Common Stock of Epitope, Inc., and tenders payment
herewith in the amount of U.S. $_________ in accordance with the terms thereof.
The undersigned hereby certifies that (mark one of the two responses
below):
___ (i) It is the sole beneficial owner of the Warrants being
exercised, (ii) it is not a U.S. person, within the meaning of
Regulation S promulgated by the United States Securities and
Exchange Commission pursuant to the Securities Act of 1933
("1933 Act"), and (iii) it is not exercising Warrants for the
benefit of any U.S. person.
--OR--
___ The securities to be delivered upon exercise of the Warrant
("Warrant Shares") have been registered under the 1933 Act or
are exempt from registration thereunder and Epitope, Inc., has
been provided with a written opinion of counsel to that
effect. [A legal opinion regarding the registration of the
Warrant Shares will be obtained at the expense of Epitope,
Inc., by its designated legal counsel upon notice of exercise
of the Warrant Agreement by the Warrantholder at any time
after the effective date of a registration statement covering
the Warrant Shares; any other legal opinion shall be the
responsibility of the Warrantholder.]
Please deliver the certificate and a new Warrant Agreement for the
unexercised Warrants, if any, to:
------------------------------------
------------------------------------
------------------------------------
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Name and Title:
Dated: ---------------, 199--
Warrantholder: --------------------------------
Address: --------------------------------
--------------------------------
--------------------------------
<PAGE>
FORM OF ASSIGNMENT
[NOTE: Unless the Warrants have been registered under the 1933 Act or are
exempt from registration thereunder, this Assignment must be executed, and
the re-issued Warrants must be delivered, outside of the United States of
America, its territories and possessions.]
FOR VALUE RECEIVED, the undersigned registered owner of this Warrant
Agreement hereby sells, assigns, and transfers unto the Assignee(s) named below
all of the rights of the undersigned under the Warrant Agreement, with respect
to Warrants for the number of shares of Common Stock set forth below:
Name of Assignee Address No. of Shares*
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*Please note that the minimum denomination in which Warrant Agreements may
be issued is 1,000 shares of Common Stock.
Dated: --------------, 19--.
Warrantholder:------------------------------
By------------------------------------------
Title:
[Name of warrantholder must be identical to
name shown in the registry books of the
Company; signature must be guaranteed by a
bank or brokerage firm doing business in the
United States.]
[Form of Notice -- 1992 Warrants]
NOTICE TO WARRANTHOLDERS
THE WARRANTS REFERRED TO BELOW AND THE SHARES OF COMMON STOCK UNDERLYING THE
WARRANTS HAVE NOT BEEN REGISTERED FOR ISSUANCE TO THE WARRANTHOLDERS UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED ("1933 ACT"), AND MAY NOT BE
OFFERED, SOLD, TRANSFERRED, PLEDGED, OR OTHERWISE DISPOSED OF, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO A U. S. PERSON (AS SUCH
TERMS ARE DEFINED IN REGULATION S UNDER THE 1933 ACT), NOR MAY THE WARRANTS BE
EXERCISED IN THE UNITED STATES OR BY OR ON BEHALF OF A U. S. PERSON, UNLESS (i)
THE TRANSACTION IS REGISTERED UNDER THE 1933 ACT AND ANY APPLICABLE SECURITIES
LAWS OF ANY STATE, TERRITORY OR POSSESSION OF THE UNITED STATES OR THE DISTRICT
OF COLUMBIA ("STATE ACT"), OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE 1933
ACT OR ANY APPLICABLE STATE ACT IS AVAILABLE AND THE ISSUER HAS RECEIVED AN
OPINION OF COUNSEL TO SUCH EFFECT REASONABLY SATISFACTORY TO IT.
[Name and Address of Warrantholder]
Reference is made to the warrants ("Warrants") to purchase common
stock, no par value ("Common Stock"), of Epitope, Inc. (the "Company")
originally issued by the Company on December 23, 1992, and the related Warrant
Agreements ("Warrant Agreements") dated as of the same date containing the terms
of the Warrants. Capitalized terms used and not otherwise defined herein have
the same meanings as in the Warrant Agreements.
The Expiration Date for the Warrants, as previously extended, is
September 30, 1997. The Company hereby further extends the Expiration Date until
September 30, 2000.
The Company intends to effect a spin-off of Agritope, Inc.
("Agritope") by making a dividend distribution (the "Distribution") of Agritope
common stock to the Company's shareholders. Subject to and effective ten days
after occurrence of the Distribution, the Company will permit exercise of the
Warrants at a reduced exercise price per share equal to 110 percent of the
average closing price of the Common Stock on The Nasdaq Stock Market for the
five consecutive trading days beginning on the date of the Distribution.
Warrantholders will not receive Agritope common stock in the
Distribution with respect to shares of Common Stock issued upon exercise of
Warrants after the record date for the Distribution.
Please attach a copy of this notice to your Warrant Agreement.
Dated: September 12, 1997.
EPITOPE, INC.
By ----------------------------------------------------------
Executive Vice President and Chief Financial Officer
<PAGE>
THESE WARRANTS AND THE SHARES OF COMMON STOCK UNDERLYING THESE WARRANTS HAVE NOT
BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
("1933 ACT"), AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED, OR OTHERWISE
DISPOSED OF, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES
OR TO A U.S. PERSON (AS SUCH TERMS ARE DEFINED IN REGULATION S UNDER THE 1933
ACT), NOR MAY THESE WARRANTS BE EXERCISED IN THE UNITED STATES OR BY OR ON
BEHALF OF A U.S. PERSON, UNLESS (i) THE TRANSACTION IS REGISTERED UNDER THE 1933
ACT AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE, TERRITORY OR POSSESSION OF
THE UNITED STATES OR THE DISTRICT OF COLUMBIA ("STATE ACT"), OR (ii) AN
EXEMPTION FROM REGISTRATION UNDER THE 1933 ACT OR ANY APPLICABLE STATE ACT IS
AVAILABLE AND THE ISSUER HAS RECEIVED AN OPINION OF COUNSEL TO SUCH EFFECT
REASONABLY SATISFACTORY TO IT.
COMMON STOCK PURCHASED PURSUANT TO THE EXERCISE OF THESE WARRANTS MAY NOT BE
SOLD OR OTHERWISE TRANSFERRED OR DISPOSED OF FOR A PERIOD OF 60 DAYS AFTER THE
DATE OF PURCHASE OF SUCH COMMON STOCK
VOID AFTER 5 P.M., UNITED STATES PACIFIC TIME,
ON SEPTEMBER 30, 2000
OR SUCH EARLIER DATE AS SPECIFIED HEREIN
WARRANTS TO PURCHASE COMMON STOCK
Warrant No. ___ ______________ Warrants
EPITOPE, INC.
THIS CERTIFIES THAT
[Name of warrantholder]
or registered assigns, is the registered holder of the number of Warrants (each,
a "Warrant," and collectively, "Warrants") set forth above. Each Warrant
represented by this certificate for Warrants ("Warrant Agreement") entitles the
registered holder thereof (the "Warrantholder") to purchase from Epitope, Inc.,
a corporation incorporated under the laws of the state of Oregon ("Company"),
United States of America ("U.S."), one fully paid and nonassessable share of
common stock, no par value, of the Company ("Common Stock") upon presentation
and surrender of this Warrant Agreement with the accompanying Election to
Exercise Warrants duly completed, at any time prior to 5 P.M., U.S. Pacific
time, on the Expiration Date (as defined in Section 2), at the corporate offices
of the Company at 8505 S.W. Creekside Place, Beaverton, Oregon 97008, or at such
other address as may be specified by the Company pursuant to Section ,
accompanied by payment of the Exercise Price (as defined herein) and any
applicable taxes, either in cash in U.S. funds or by certified or official bank
check in U.S. funds payable to the order of the Company. These Warrants are
issued pursuant to a Warrant Purchase Agreement ("Purchase Agreement") among the
Company and the Investors described therein dated as of November 25, 1992.
Section 1. Exercise Price. Each Warrant entitles the Warrantholder to
purchase one share of Common Stock for U.S. $_____ (the "Exercise Price"),
subject to adjustment as provided herein.
Section 2. Expiration. All Warrants not theretofore exercised shall expire
at 5 p.m., U.S. Pacific time, on the earlier of the following dates (the
"Expiration Date"): (a) September 30, 2000 and (b) the expiration of 120 days
after the first period of 20 consecutive trading days during which period the
average of the high and low sales prices of the Common Stock on The Nasdaq Stock
Market or any other exchange or national market system on which the Common Stock
is then traded, is at least $30.00.
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<PAGE>
Section 3. Adjustments of Number and Kind of Shares Purchasable and
Exercise Price. The number and kind of securities or other property purchasable
upon exercise of a Warrant shall be subject to adjustment from time to time upon
the occurrence, after the date hereof, of the following events:
3.1 If the outstanding shares of the Company's Common Stock are
divided into a greater number of shares or a dividend in Common Stock is
paid on the Common Stock, the number of shares of Common Stock issuable on
exercise of the Warrants shall be proportionately increased and the
Exercise Price in effect immediately prior to such subdivision or at the
record date of such dividend shall, simultaneously with the effectiveness
of such subdivision or immediately after the record date of such dividend,
be proportionately reduced; and, conversely, if the outstanding shares of
Common Stock are combined into a smaller number of shares of Common Stock,
the number of shares of Common Stock issuable upon exercise of the
Warrants shall be proportionately reduced and the Exercise Price in effect
immediately prior to such combination shall, simultaneously with the
effectiveness of such combination, be proportionately increased. The
increases and reductions provided for in this subsection 3.1 shall be made
with the intent and, as nearly as practicable, the effect that neither the
percentage of the total equity of the Company issuable on exercise of the
Warrants nor the price payable for such percentage upon such exercise
shall be affected by any event described in this subsection 3.1.
3.2 No adjustment of the Exercise Price will be made if the amount
of the adjustment is less than U.S. $.01 per share, but in that case any
adjustment that would otherwise be required to be made will be carried
forward and will be made at the time of and together with the next
adjustment of the Exercise Price which, together with any adjustment
carried forward, amounts to U.S. $.01 per share or more.
3.3 In case of any change in the Common Stock of the Company through
merger, consolidation, reclassification, reorganization, partial or
complete liquidation, or other change in the capital structure of the
Company (not including a combination of shares or the issuance of
additional shares of Common Stock by the Company by stock split or stock
dividend), then, as a condition of the change in the capital structure of
the Company, provision shall be made so that the holder of this Warrant
Agreement will have the right thereafter to receive upon the exercise of
the Warrants the kind and amount of shares of stock or other securities or
property to which such holder would have been entitled if, immediately
prior to such merger, consolidation, reclassification, reorganization,
recapitalization, or other change in the capital structure, such holder
had held the number of shares of Common Stock issuable upon the exercise
of the Warrants. In any such case, appropriate adjustment shall be made in
the application of the provisions set forth herein with respect to the
rights and interest thereafter of the Warrantholder, to the end that the
provisions set forth herein shall thereafter be applicable, as nearly as
reasonably may be, in relation to any shares of stock or other property
thereafter deliverable upon the exercise of the Warrants. The Company will
not permit any change in its capital structure to occur unless the issuer
of the shares of stock or other securities to be received by the holder of
this Warrant Agreement, if not the Company, agrees to be bound by and
comply with the provisions of this Warrant Agreement.
3.4 When any adjustment is required to be made in the number of
shares of Common Stock, other securities, or property purchasable upon
exercise of the Warrants, the Company shall promptly determine the new
number of shares or other securities or property purchasable upon exercise
of the Warrants and (a) prepare and retain on file a statement describing
in reasonable detail the method used in arriving at the new number of
shares or other securities or property purchasable upon exercise of the
Warrants and (b) cause a copy of such statement to be mailed to the
Warrantholder within thirty (30) days after the date when the event giving
rise to the adjustment occurred.
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<PAGE>
3.5 No fractional shares of Common Stock or other securities shall
be issued in connection with the exercise of any Warrants, but the Company
shall pay, in lieu of fractional shares, a cash payment therefor on the
basis of the closing price on a national securities exchange on the day
immediately prior to exercise or, if the Common Stock or other securities
are not traded on a national securities exchange on such day, on the basis
of the fair market value thereof as determined by the board of directors
of the Company, which determination shall be conclusive.
3.6 Notwithstanding anything herein to the contrary, there shall be
no adjustment made hereunder on account of the sale and issuance of the
shares of Common Stock or other securities purchasable upon exercise of
the Warrants.
Section 4. Rights of Warrantholder as Shareholder. No holder of this
Warrant Agreement shall, as such, be entitled to vote, receive dividends, or be
deemed the holder of Common Stock or any other securities of the Company that
may at any time be issuable on the exercise hereof for any purpose whatever, nor
shall anything contained herein be construed to confer upon the holder of this
Warrant Agreement, as such, any of the rights of a shareholder of the Company or
any right to vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof or give or withhold consent to any corporate
action (whether upon any matter submitted to shareholders at any meeting thereof
or otherwise) including, without limitation, giving or withholding consent to
any merger, recapitalization, issuance of stock, reclassification of stock,
exchange of stock, change of stock to par value, consolidation or conveyance, or
to receive notice of meetings or other actions affecting shareholders or to
receive dividends or subscription rights or other distributions.
Section 5. Payment of Certain Taxes and Charges. The Company shall not be
required to issue or deliver any certificate for shares of Common Stock or other
securities upon the exercise of Warrants evidenced by this Warrant Agreement or
to register the transfer of the Warrants evidenced hereby until any applicable
transfer tax and any other taxes or governmental charges that the Company may be
required by law to collect in respect of such exercise or transfer shall have
been paid, such tax being payable by the holder of this Warrant Agreement at the
time of surrender for exercise or transfer.
Section 6. Registration. The Company has prepared a registration statement
on Form S-3 (the "Registration Statement") under the 1933 Act with respect to
transfer by the Warrantholder of the Warrants covered by this Warrant Agreement
and the re-sale by the Warrantholder of the shares of Common Stock issued or
issuable upon exercise of this Warrant Agreement (the "Warrant Shares"). As soon
as practicable after the original issue date of this Warrant Agreement (the
"Original Issue Date"), the Company shall file the Registration Statement with
the U.S. Securities and Exchange Commission and shall use its best efforts to
cause the Registration Statement to become effective under the 1933 Act as
promptly as practicable after the Original Issue Date as provided for in, and in
accordance with, the terms and conditions of the Purchase Agreement.
Section 7. Transfer and Exchange.
7.1 Transfer. This Warrant Agreement is transferable on the registry
books of the Company subject to the restrictions on the first page hereof
and in Section . The Company may deem and treat the person or entity in
whose name this Warrant Agreement is registered as the absolute owner
hereof (notwithstanding any notation of ownership or other writing thereon
made by anyone other than the Company) for all purposes whatever, and the
Company shall not be affected by any notice to the contrary.
7.2 Exchange. Subject to the provisions of Section and the
restrictions on the first page hereof, this Warrant Agreement is
exchangeable at the principal office of the Company for Warrant Agreements
to purchase the same aggregate number of shares of Common Stock as are
purchasable hereunder, each new Warrant Agreement to represent the right
to purchase such number of shares as the Warrantholder shall designate at
the time of such exchange.
- 3 -
<PAGE>
7.3 Securities Act of 1933. The Warrantholder, by acceptance hereof,
agrees that this Warrant Agreement and the shares of Common Stock issued
or issuable upon exercise of this Warrant Agreement may not be offered or
sold except in compliance with the 1933 Act. The Warrantholder consents to
the Company's making a notation on its records and on the certificates for
any shares of Common Stock issued upon exercise hereof in order to
implement such restriction on transferability.
7.4 Minimum Warrant Agreement Amount. Notwithstanding the provisions
of Section and Section , the Company shall not be required to issue a
Warrant Agreement for Warrants covering less than 1,000 shares of Common
Stock, except in the case of a partial exercise by the Warrantholder of
this Warrant Agreement that leaves Warrants exercisable to purchase less
than 1,000 shares that are to remain registered in the name of the
exercising Warrantholder, and any subsequent partial exercise, transfer,
or exchange of such Warrant Agreement.
7.5 No Transfer of Common Stock for 60 Days. Common Stock purchased
pursuant to the exercise of these Warrants may not be sold or otherwise
transferred or disposed of for a period of 60 days after the date of
purchase of such Common Stock.
Section 8. Holdback Agreement. The Warrantholder, if requested by the
Company and an underwriter of the Company's securities, shall agree not to sell
or otherwise transfer or dispose of any Warrants or Warrant Shares for a
specified period of time (not to exceed 90 days) following the effective date of
a registration statement pursuant to which the Company proposes to sell its
securities to the public generally; provided, however, that all executive
officers and directors of the Company enter into similar agreements.
Section 9. Notices. Any notice, request, or other communication required
or permitted hereunder shall be in writing and shall be deemed to have been duly
given if delivered personally, by international courier service, or by
registered mail, airmail postage prepaid, return receipt requested, to: (a) the
Company at 8505 S.W. Creekside Place, Beaverton, Oregon 97008, U.S.A., Attn:
Secretary, with a copy to Miller, Nash, Wiener, Hager & Carlsen LLP, 3500 U. S.
Bancorp Tower, 111 S.W. Fifth Avenue, Portland, Oregon 97204, U.S.A., Attn:
Erich W. Merrill, Jr., or at such other addresses as may be specified by the
Company by notice given to the Warrantholders in accordance with this Section 9,
and (b) to the Warrantholders at the addresses set forth in the registry books
of the Company referred to in Section 7.1, with copies to Michel de Beaumont,
American Equities Overseas (U.K.) Ltd., 16 Old Bond Street, London W1X 3DB,
United Kingdom, and Jack H. Halperin, Esq., 361 Silver Court, Woodmere, New York
11598, U.S.A. Any notice, request or other communication (other than an Election
to Exercise Warrants) given by registered airmail shall be deemed given 10 days
after the mailing date; notices, requests, or other communications given in any
other manner and any Election to Exercise Warrants shall be deemed given when
received.
Section 10. Amendment. This Warrant Agreement may be amended or its
provisions waived only by an instrument in writing signed by the Company and the
Warrantholder as provided in the Purchase Agreement.
Section 11. Certain Definitions. Rules 9.02(o) and 9.02(p) of Regulation S
promulgated under the 1933 Act defining "U.S. person" and "United States,"
respectively, are set forth in Appendix 1.
Section 12. Law Governing. This Warrant Agreement shall be governed by and
construed in accordance with the laws of the state of Oregon, without giving
effect to choice of laws principles thereof.
Dated as of ---------------------.
EPITOPE, INC.
By ---------------------------------------------
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<PAGE>
APPENDIX 1
to
Warrant Agreement
Set forth below is the text of Rule 902(o) promulgated under the
1933 Act which defines "U.S. person" as follows:
(o) U.S. Person.
(1) "U.S. person" means:
(i) Any natural person resident in the United States;
(ii) Any partnership or corporation organized or incorporated under
the laws of the United States;
(iii) Any estate of which any executor or administrator is a U.S.
person;
(iv) Any trust of which any trustee is a U.S. person;
(v) Any agency or branch of a foreign entity located in the United
States;
(vi) Any nondiscretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary for the benefit or
account of a U.S. person;
(vii) Any discretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary organized,
incorporated, or (if an individual) resident in the United States; and
(viii) Any partnership or corporation if: (A) organized or
incorporated under the laws of any foreign jurisdiction; and (B) formed by
a U.S. person principally for the purpose of investing in securities not
registered under the 1933 Act, unless it is organized or incorporated, and
owned, by accredited investors (as defined in Rule 501(a)) who are not
natural persons, estates or trusts.
(2) Notwithstanding paragraph (o)(1) of this rule, any discretionary
account or similar account (other than an estate or trust) held for the benefit
or account of a non-U.S. person by a dealer or other professional fiduciary
organized, incorporated, or (if an individual) resident in the United States
shall not be deemed a "U.S. person."
(3) Notwithstanding paragraph (o)(1), any estate of which any
professional fiduciary acting as executor or administrator is a U.S. person
shall not be deemed a U.S. person if:
(i) An executor or administrator of the estate who is not a U.S.
person has sole or shared investment discretion with respect to the assets
of the estate; and
(ii) The estate is governed by foreign law.
(4) Notwithstanding paragraph (o)(1), any trust of which any
professional fiduciary acting as trustee is a U.S. person shall not be deemed a
U.S. person if a trustee who is not a U.S. person has sole or shared
- i -
<PAGE>
investment discretion with respect to the trust assets, and no beneficiary of
the trust (and no settlor if the trust is revocable) is a U.S. person.
(5) Notwithstanding paragraph (o)(1), an employee benefit plan
established and administered in accordance with the law of a country other than
the United States and customary practices and documentation of such country
shall not be deemed a U.S. person.
(6) Notwithstanding paragraph (o)(1), any agency or branch of a U.S.
person located outside the United States shall not be deemed a "U.S. person" if:
(i) The agency or branch operates for valid business reasons; and
(ii) The agency or branch is engaged in the business of insurance or
banking and is subject to substantive insurance or banking regulation,
respectively, in the jurisdiction where located.
(7) The International Monetary Fund, the International Bank for
Reconstruction and Development, the Inter-American Development Bank, the Asian
Development Bank, the African Development Bank, the United Nations, and their
agencies, affiliates and pension plans, and any other similar international
organizations, their agencies, affiliates and pension plans shall not be deemed
"U.S. persons."
Set forth below is the text of Rule 9.02(p) promulgated under the
1933 Act which defines "United States" as follows:
(p) "United States" means the United States of America, its
territories and possessions, any State of the United States, and the District of
Columbia.
- ii -
<PAGE>
ELECTION TO EXERCISE WARRANTS
[NOTE: Unless the transaction has been registered under the 1933 Act or is
exempt from registration thereunder, this Election to Exercise Warrants
must be executed, and the Warrant Shares must be delivered, outside of the
U.S., its territories and possessions.]
To: Epitope, Inc.
8505 S.W. Creekside Place
Beaverton, Oregon 97008
U.S.A.
The undersigned hereby exercises Warrants represented by the within
Warrant Agreement for ________ shares of the Common Stock of Epitope, Inc.
("Warrant Shares"), and tenders payment herewith in the amount of U.S.
$_________ in accordance with the terms thereof.
The undersigned hereby certifies that (mark one of the two responses
below):
___ (i) It is the sole beneficial owner of the Warrants being exercised,
(ii) it is not a U.S. person, as defined in Appendix 1 to the within
Warrant Agreement and within the meaning of Regulation S promulgated
by the U.S. Securities and Exchange Commission pursuant to the
Securities Act of 1933 ("1933 Act"), and (iii) it is not exercising
Warrants for the benefit of any U.S. person.
--OR--
___ The transaction in which the Warrant Shares will be delivered upon
exercise of the Warrant has been registered under the 1933 Act or is
exempt from registration thereunder and Epitope, Inc., has been
provided with a written opinion of counsel to that effect or has
waived the requirement for an opinion. A legal opinion regarding the
registration of the transaction will be obtained at the expense of
Epitope, Inc., by its designated legal counsel upon notice of
exercise of the Warrant Agreement by the Warrantholder at any time
after the effective date of a registration statement covering the
transaction; any other legal opinion shall be the responsibility of
the Warrantholder.
THE UNDERSIGNED HEREBY AGREES NOT TO SELL OR OTHERWISE TRANSFER OR DISPOSE
OF THE WARRANT SHARES FOR A PERIOD ENDING 60 DAYS AFTER THE DATE OF PURCHASE OF
THE WARRANT SHARES.
Please deliver the certificate and a new Warrant Agreement for the
unexercised Warrants, if any, to:
------------------------------------
------------------------------------
------------------------------------
Warrantholder:--------------------------------------
By--------------------------------------------------
Title:
Dated: --------------, 19-- [Name of Warrantholder must be identical to name
shown in the registry books of the Company;
signature must be guaranteed by a bank or
brokerage firm doing business in the U.S.]
Warrantholder: -----------------------------------
Address: -----------------------------------
-----------------------------------
-----------------------------------
<PAGE>
FORM OF ASSIGNMENT
[NOTE: Unless the transaction has been registered under the 1933 Act or is
exempt from registration thereunder, this Assignment must be executed, and
the re-issued Warrants must be delivered, outside of the U.S., its
territories and possessions.]
FOR VALUE RECEIVED, the undersigned registered owner of this Warrant
Agreement hereby sells, assigns, and transfers to the Assignee(s) named below
all of the rights of the undersigned under the Warrant Agreement, with respect
to Warrants for the number of shares of Common Stock set forth below:
Name of Assignee Address No. of Shares*
- ---------------- ------- --------------
*Please note that the minimum denomination in which Warrant Agreements may
be issued is 1,000 shares of Common Stock.
Dated: ------------, 19--.
Warrantholder:--------------------------------------
By-------------------------------------
Title:
[Name of Warrantholder must be identical to
name shown in the registry books of the
Company; signature must be guaranteed by a
bank or brokerage firm doing business in the
U.S.]
[Form of Notice -- 1993 Warrants]
NOTICE TO WARRANTHOLDERS
THE WARRANTS REFERRED TO BELOW AND THE SHARES OF COMMON STOCK UNDERLYING THE
WARRANTS HAVE NOT BEEN REGISTERED FOR ISSUANCE TO THE WARRANTHOLDERS UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED ("1933 ACT"), AND MAY NOT BE
OFFERED, SOLD, TRANSFERRED, PLEDGED, OR OTHERWISE DISPOSED OF, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO A U. S. PERSON (AS SUCH
TERMS ARE DEFINED IN REGULATION S UNDER THE 1933 ACT), NOR MAY THE WARRANTS BE
EXERCISED IN THE UNITED STATES OR BY OR ON BEHALF OF A U. S. PERSON, UNLESS (i)
THE TRANSACTION IS REGISTERED UNDER THE 1933 ACT AND ANY APPLICABLE SECURITIES
LAWS OF ANY STATE, TERRITORY OR POSSESSION OF THE UNITED STATES OR THE DISTRICT
OF COLUMBIA ("STATE ACT"), OR (ii) AN EXEMPTION FROM REGISTRATION UNDER THE 1933
ACT OR ANY APPLICABLE STATE ACT IS AVAILABLE AND THE ISSUER HAS RECEIVED AN
OPINION OF COUNSEL TO SUCH EFFECT REASONABLY SATISFACTORY TO IT.
[Name and Address of Warrantholder]
Reference is made to the warrants ("Warrants") to purchase common
stock, no par value ("Common Stock"), of Epitope, Inc. (the "Company")
originally issued by the Company on July 23, 1993, and the related Warrant
Agreements ("Warrant Agreements") dated as of the same date containing the terms
of the Warrants. Capitalized terms used and not otherwise defined herein have
the same meanings as in the Warrant Agreements.
The Expiration Date for the Warrants, as previously extended, is
September 30, 1997. The Company hereby further extends the Expiration Date until
September 30, 2000.
The Company intends to effect a spin-off of Agritope, Inc.
("Agritope") by making a dividend distribution (the "Distribution") of Agritope
common stock to the Company's shareholders. Subject to and effective ten days
after occurrence of the Distribution, the Company will permit exercise of the
Warrants at a reduced exercise price per share equal to 110 percent of the
average closing price of the Common Stock on The Nasdaq Stock Market for the
five consecutive trading days beginning on the date of the Distribution.
Warrantholders will not receive Agritope common stock in the
Distribution with respect to shares of Common Stock issued upon exercise of
Warrants after the record date for the Distribution.
Please attach a copy of this notice to your Warrant Agreement.
Dated: September 12, 1997.
EPITOPE, INC.
By ------------------------------------------------------
Executive Vice President and Chief Financial Officer
<PAGE>
THESE WARRANTS AND THE SHARES OF COMMON STOCK UNDERLYING THESE WARRANTS HAVE NOT
BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
("1933 ACT"), AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED, OR OTHERWISE
DISPOSED OF, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES
OR TO A U.S. PERSON (AS SUCH TERMS ARE DEFINED IN REGULATION S UNDER THE 1933
ACT), NOR MAY THESE WARRANTS BE EXERCISED IN THE UNITED STATES OR BY OR ON
BEHALF OF A U.S. PERSON, UNLESS (i) THE TRANSACTION IS REGISTERED UNDER THE 1933
ACT AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE, TERRITORY OR POSSESSION OF
THE UNITED STATES OR THE DISTRICT OF COLUMBIA ("STATE ACT"), OR (ii) AN
EXEMPTION FROM REGISTRATION UNDER THE 1933 ACT OR ANY APPLICABLE STATE ACT IS
AVAILABLE AND THE ISSUER HAS RECEIVED AN OPINION OF COUNSEL TO SUCH EFFECT
REASONABLY SATISFACTORY TO IT.
COMMON STOCK PURCHASED PURSUANT TO THE EXERCISE OF THESE WARRANTS MAY NOT BE
SOLD OR OTHERWISE TRANSFERRED OR DISPOSED OF FOR A PERIOD OF 60 DAYS AFTER THE
DATE OF PURCHASE OF SUCH COMMON STOCK.
VOID AFTER 5 P.M., UNITED STATES PACIFIC TIME,
ON SEPTEMBER 30, 2000
OR SUCH EARLIER DATE AS SPECIFIED HEREIN
WARRANTS TO PURCHASE COMMON STOCK
Warrant No. ___ ______________ Warrants
EPITOPE, INC.
THIS CERTIFIES THAT
[name of warrantholder]
or registered assigns, is the registered holder of the number of Warrants (each,
a "Warrant," and collectively, "Warrants") set forth above. Each Warrant
represented by this certificate for Warrants ("Warrant Agreement") entitles the
registered holder thereof (the "Warrantholder") to purchase from Epitope, Inc.,
a corporation incorporated under the laws of the state of Oregon ("Company"),
United States of America ("U.S."), one fully paid and nonassessable share of
common stock, no par value, of the Company ("Common Stock") upon presentation
and surrender of this Warrant Agreement with the accompanying Election to
Exercise Warrants duly completed, at any time after the Common Stock issuable
upon exercise of this Warrant has been approved for quotation on The Nasdaq
Stock Market, and prior to 5 P.M., U.S. Pacific time, on the Expiration Date (as
defined in Section 2), at the corporate offices of the Company at 8505 S.W.
Creekside Place, Beaverton, Oregon 97008, or at such other address as may be
specified by the Company pursuant to Section 9, accompanied by payment of the
Exercise Price (as defined herein) and any applicable taxes, either in cash in
U.S. funds or by certified or official bank check in U.S. funds payable to the
order of the Company. These Warrants are issued pursuant to a 1993 Warrant
Purchase Agreement ("Purchase Agreement") among the Company and the Investors
described therein dated as of July 6, 1993.
Section 1. Exercise Price. Each Warrant entitles the Warrantholder to
purchase one share of Common Stock for U.S. $_____ (the "Exercise Price"),
subject to adjustment as provided herein.
Section 2. Expiration. All Warrants not theretofore exercised shall expire
at 5 p.m., U.S. Pacific time, on the earlier of the following dates (the
"Expiration Date"): (a) September 30, 2000, and (b) the expiration of 120
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<PAGE>
days after the first period of 20 consecutive trading days during which period
the average of the high and low sales prices of the Common Stock on The Nasdaq
Stock Market, or any other exchange or national market system on which the
Common Stock is then traded, is at least $30.00.
Section 3. Adjustments of Number and Kind of Shares Purchasable and
Exercise Price. The number and kind of securities or other property purchasable
upon exercise of a Warrant shall be subject to adjustment from time to time upon
the occurrence, after the date hereof, of the following events:
3.1 If the outstanding shares of the Company's Common Stock are
divided into a greater number of shares or a dividend in Common Stock is
paid on the Common Stock, the number of shares of Common Stock issuable on
exercise of the Warrants shall be proportionately increased and the
Exercise Price in effect immediately prior to such subdivision or at the
record date of such dividend shall, simultaneously with the effectiveness
of such subdivision or immediately after the record date of such dividend,
be proportionately reduced; and, conversely, if the outstanding shares of
Common Stock are combined into a smaller number of shares of Common Stock,
the number of shares of Common Stock issuable upon exercise of the
Warrants shall be proportionately reduced and the Exercise Price in effect
immediately prior to such combination shall, simultaneously with the
effectiveness of such combination, be proportionately increased. The
increases and reductions provided for in this subsection 3.1 shall be made
with the intent and, as nearly as practicable, the effect that neither the
percentage of the total equity of the Company issuable on exercise of the
Warrants nor the price payable for such percentage upon such exercise
shall be affected by any event described in this subsection 3.1.
3.2 No adjustment of the Exercise Price will be made if the amount
of the adjustment is less than U.S. $.01 per share, but in that case any
adjustment that would otherwise be required to be made will be carried
forward and will be made at the time of and together with the next
adjustment of the Exercise Price which, together with any adjustment
carried forward, amounts to U.S. $.01 per share or more.
3.3 In case of any change in the Common Stock of the Company through
merger, consolidation, reclassification, reorganization, partial or
complete liquidation, or other change in the capital structure of the
Company (not including a combination of shares or the issuance of
additional shares of Common Stock by the Company by stock split or stock
dividend), then, as a condition of the change in the capital structure of
the Company, provision shall be made so that the holder of this Warrant
Agreement will have the right thereafter to receive upon the exercise of
the Warrants the kind and amount of shares of stock or other securities or
property to which such holder would have been entitled if, immediately
prior to such merger, consolidation, reclassification, reorganization,
recapitalization, or other change in the capital structure, such holder
had held the number of shares of Common Stock issuable upon the exercise
of the Warrants. In any such case, appropriate adjustment shall be made in
the application of the provisions set forth herein with respect to the
rights and interest thereafter of the Warrantholder, to the end that the
provisions set forth herein shall thereafter be applicable, as nearly as
reasonably may be, in relation to any shares of stock or other property
thereafter deliverable upon the exercise of the Warrants. The Company will
not permit any change in its capital structure to occur unless the issuer
of the shares of stock or other securities to be received by the holder of
this Warrant Agreement, if not the Company, agrees to be bound by and
comply with the provisions of this Warrant Agreement.
3.4 When any adjustment is required to be made in the number of
shares of Common Stock, other securities, or property purchasable upon
exercise of the Warrants, the Company shall promptly determine the new
number of shares or other securities or property purchasable upon exercise
of the Warrants and (a) prepare and retain on file a statement describing
in reasonable detail the method used in arriving at the new number of
shares or other securities or property
- 2 -
<PAGE>
purchasable upon exercise of the Warrants and (b) cause a copy of such
statement to be mailed to the Warrantholder within thirty (30) days after
the date when the event giving rise to the adjustment occurred.
3.5 No fractional shares of Common Stock or other securities shall
be issued in connection with the exercise of any Warrants, but the Company
shall pay, in lieu of fractional shares, a cash payment therefor on the
basis of the closing price on a national securities exchange on the day
immediately prior to exercise or, if the Common Stock or other securities
are not traded on a national securities exchange on such day, on the basis
of the fair market value thereof as determined by the board of directors
of the Company, which determination shall be conclusive.
3.6 Notwithstanding anything herein to the contrary, there shall be
no adjustment made hereunder on account of the sale and issuance of the
shares of Common Stock or other securities purchasable upon exercise of
the Warrants.
Section 4. Rights of Warrantholder as Shareholder. No holder of this
Warrant Agreement shall, as such, be entitled to vote, receive dividends, or be
deemed the holder of Common Stock or any other securities of the Company that
may at any time be issuable on the exercise hereof for any purpose whatever, nor
shall anything contained herein be construed to confer upon the holder of this
Warrant Agreement, as such, any of the rights of a shareholder of the Company or
any right to vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof or give or withhold consent to any corporate
action (whether upon any matter submitted to shareholders at any meeting thereof
or otherwise) including, without limitation, giving or withholding consent to
any merger, recapitalization, issuance of stock, reclassification of stock,
exchange of stock, change of stock to par value, consolidation or conveyance, or
to receive notice of meetings or other actions affecting shareholders or to
receive dividends or subscription rights or other distributions.
Section 5. Payment of Certain Taxes and Charges. The Company shall not be
required to issue or deliver any certificate for shares of Common Stock or other
securities upon the exercise of Warrants evidenced by this Warrant Agreement or
to register the transfer of the Warrants evidenced hereby until any applicable
transfer tax and any other taxes or governmental charges that the Company may be
required by law to collect in respect of such exercise or transfer shall have
been paid, such tax being payable by the holder of this Warrant Agreement at the
time of surrender for exercise or transfer.
Section 6. Registration. The Company has prepared a registration statement
on Form S-3 (the "Registration Statement") under the 1933 Act with respect to
the resale by the Warrantholder of the Warrants covered by this Warrant
Agreement and of the shares of Common Stock issued or issuable upon exercise of
this Warrant Agreement (the "Warrant Shares"). As soon as practicable after the
original issue date of this Warrant Agreement (the "Original Issue Date"), the
Company shall file the Registration Statement with the U.S. Securities and
Exchange Commission and shall use its best efforts to cause the Registration
Statement to become effective under the 1933 Act as promptly as practicable
after the Original Issue Date as provided for in, and in accordance with, the
terms and conditions of the Purchase Agreement.
Section 7. Transfer and Exchange.
7.1 Transfer. This Warrant Agreement is transferable on the registry
books of the Company subject to the restrictions on the first page hereof
and in Section 7.4. The Company may deem and treat the person or entity in
whose name this Warrant Agreement is registered as the absolute owner
hereof (notwithstanding any notation of ownership or other writing thereon
made by anyone other than the Company) for all purposes whatever, and the
Company shall not be affected by any notice to the contrary.
7.2 Exchange. Subject to the provisions of Section 7.4 and the
restrictions on the first page hereof, this Warrant Agreement is
exchangeable at the principal office of the Company
- 3 -
<PAGE>
for Warrant Agreements to purchase the same aggregate number of shares of
Common Stock as are purchasable hereunder, each new Warrant Agreement to
represent the right to purchase such number of shares as the Warrantholder
shall designate at the time of such exchange.
7.3 Securities Act of 1933. The Warrantholder, by acceptance hereof,
agrees that this Warrant Agreement and the shares of Common Stock issued
or issuable upon exercise of this Warrant Agreement may not be offered or
sold except in compliance with the 1933 Act. The Warrantholder consents to
the Company's making a notation on its records and on the certificates for
any shares of Common Stock issued upon exercise hereof in order to
implement such restriction on transferability.
7.4 Minimum Warrant Agreement Amount. Notwithstanding the provisions
of Section 7.1 and Section 7.2, the Company shall not be required to issue
a Warrant Agreement for Warrants covering less than 1,000 shares of Common
Stock, except in the case of a partial exercise by the Warrantholder of
this Warrant Agreement that leaves Warrants exercisable to purchase less
than 1,000 shares that are to remain registered in the name of the
exercising Warrantholder, and any subsequent partial exercise, transfer,
or exchange of such Warrant Agreement.
7.5 No Transfer of Common Stock for 60 Days. Common Stock purchased
pursuant to the exercise of these Warrants may not be sold or otherwise
transferred or disposed of for a period of 60 days after the date of
purchase of such Common Stock.
Section 8. Holdback Agreement. The Warrantholder, if requested by the
Company and an underwriter of the Company's securities, shall agree not to sell
or otherwise transfer or dispose of any Warrants or Warrant Shares for a
specified period of time (not to exceed 90 days) following the effective date of
a registration statement pursuant to which the Company proposes to sell its
securities to the public generally; provided, however, that all executive
officers and directors of the Company enter into similar agreements.
Section 9. Notices. Any notice, request, or other communication required
or permitted hereunder shall be in writing and shall be deemed to have been duly
given if delivered personally, by international courier service, or by
registered mail, airmail postage prepaid, return receipt requested, to: (a) the
Company at 8505 S.W. Creekside Place, Beaverton, Oregon 97008, U.S.A., Attn:
Secretary, with a copy to Miller, Nash, Wiener, Hager & Carlsen LLP, 3500 U. S.
Bancorp Tower, 111 S.W. Fifth Avenue, Portland, Oregon 97204, U.S.A., Attn:
Erich W. Merrill, Jr., or at such other addresses as may be specified by the
Company by notice given to the Warrantholders in accordance with this Section 9,
and (b) to the Warrantholders at the addresses set forth in the registry books
of the Company referred to in Section 7.1, with copies to Michel de Beaumont,
American Equities Overseas (U.K.) Ltd., 16 Old Bond Street, London W1X 3DB,
United Kingdom, and Jack H. Halperin, Esq., 361 Silver Court, Woodmere, New York
11598, U.S.A. Any notice, request or other communication (other than an Election
to Exercise Warrants) given by registered airmail shall be deemed given ten days
after the mailing date; notices, requests, or other communications given in any
other manner and any Election to Exercise Warrants shall be deemed given when
received.
Section 10. Amendment. This Warrant Agreement may be amended or its
provisions waived only by an instrument in writing signed by the Company and the
Warrantholder as provided in the Purchase Agreement.
Section 11. Certain Definitions. Rules 9.02(o) and 9.02(p) of Regulation S
promulgated under the 1933 Act defining "U.S. person" and "United States,"
respectively, are set forth in Appendix 1.
- 4 -
<PAGE>
Section 12. Law Governing. This Warrant Agreement shall be governed by and
construed in accordance with the laws of the state of Oregon, without giving
effect to choice of laws principles thereof.
Dated as of --------------.
EPITOPE, INC.
By -----------------------------------------
- 5 -
<PAGE>
APPENDIX 1
to
Warrant Agreement
Set forth below is the text of Rule 902(o) promulgated under the
1933 Act which defines "U.S. person" as follows:
(o) U.S. Person.
(1) "U.S. person" means:
(i) Any natural person resident in the United States;
(ii) Any partnership or corporation organized or incorporated under
the laws of the United States;
(iii) Any estate of which any executor or administrator is a U.S.
person;
(iv) Any trust of which any trustee is a U.S. person;
(v) Any agency or branch of a foreign entity located in the United
States;
(vi) Any nondiscretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary for the benefit or
account of a U.S. person;
(vii) Any discretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary organized,
incorporated, or (if an individual) resident in the United States; and
(viii) Any partnership or corporation if: (A) organized or
incorporated under the laws of any foreign jurisdiction; and (B) formed by
a U.S. person principally for the purpose of investing in securities not
registered under the 1933 Act, unless it is organized or incorporated, and
owned, by accredited investors (as defined in Rule 501(a)) who are not
natural persons, estates or trusts.
(2) Notwithstanding paragraph (o)(1) of this rule, any discretionary
account or similar account (other than an estate or trust) held for the benefit
or account of a non-U.S. person by a dealer or other professional fiduciary
organized, incorporated, or (if an individual) resident in the United States
shall not be deemed a "U.S. person."
(3) Notwithstanding paragraph (o)(1), any estate of which any
professional fiduciary acting as executor or administrator is a U.S. person
shall not be deemed a U.S. person if:
(i) An executor or administrator of the estate who is not a U.S.
person has sole or shared investment discretion with respect to the assets
of the estate; and
(ii) The estate is governed by foreign law.
- i -
<PAGE>
(4) Notwithstanding paragraph (o)(1), any trust of which any
professional fiduciary acting as trustee is a U.S. person shall not be deemed a
U.S. person if a trustee who is not a U.S. person has sole or shared investment
discretion with respect to the trust assets, and no beneficiary of the trust
(and no settlor if the trust is revocable) is a U.S. person.
(5) Notwithstanding paragraph (o)(1), an employee benefit plan
established and administered in accordance with the law of a country other than
the United States and customary practices and documentation of such country
shall not be deemed a U.S. person.
(6) Notwithstanding paragraph (o)(1), any agency or branch of a U.S.
person located outside the United States shall not be deemed a "U.S. person" if:
(i) The agency or branch operates for valid business reasons; and
(ii) The agency or branch is engaged in the business of insurance or
banking and is subject to substantive insurance or banking regulation,
respectively, in the jurisdiction where located.
(7) The International Monetary Fund, the International Bank for
Reconstruction and Development, the Inter-American Development Bank, the Asian
Development Bank, the African Development Bank, the United Nations, and their
agencies, affiliates and pension plans, and any other similar international
organizations, their agencies, affiliates and pension plans shall not be deemed
"U.S. persons."
Set forth below is the text of Rule 9.02(p) promulgated under the
1933 Act which defines "United States" as follows:
(p) "United States" means the United States of America, its
territories and possessions, any State of the United States, and the District of
Columbia.
<PAGE>
ELECTION TO EXERCISE WARRANTS
[NOTE: Unless the transaction has been registered under the 1933 Act or is
exempt from registration thereunder, this Election to Exercise Warrants
must be executed, and the Warrant Shares must be delivered, outside of the
U.S., its territories and possessions.]
To: Epitope, Inc.
8505 S.W. Creekside Place
Beaverton, Oregon 97008
U.S.A.
The undersigned hereby exercises Warrants represented by the within
Warrant Agreement for ________ shares of the Common Stock of Epitope, Inc.
("Warrant Shares"), and tenders payment herewith in the amount of U.S.
$_________ in accordance with the terms thereof.
The undersigned hereby certifies that (mark one of the two responses
below):
___ (i) It is the sole beneficial owner of the Warrants being exercised,
(ii) it is not a U.S. person, as defined in Appendix 1 to the within
Warrant Agreement and within the meaning of Regulation S promulgated
by the U.S. Securities and Exchange Commission pursuant to the
Securities Act of 1933 ("1933 Act"), and (iii) it is not exercising
Warrants for the benefit of any U.S. person.
--OR--
___ The transaction in which the Warrant Shares will be delivered upon
exercise of the Warrant has been registered under the 1933 Act or is
exempt from registration thereunder and Epitope, Inc., has been
provided with a written opinion of counsel to that effect or has
waived the requirement for an opinion. A legal opinion regarding the
registration of the transaction will be obtained at the expense of
Epitope, Inc., by its designated legal counsel upon notice of
exercise of the Warrant Agreement by the Warrantholder at any time
after the effective date of a registration statement covering the
transaction; any other legal opinion shall be the responsibility of
the Warrantholder.
THE UNDERSIGNED HEREBY AGREES NOT TO SELL OR OTHERWISE TRANSFER OR DISPOSE
OF THE WARRANT SHARES FOR A PERIOD ENDING 60 DAYS AFTER THE DATE OF PURCHASE OF
THE WARRANT SHARES.
Please deliver the certificate and a new Warrant Agreement for the
unexercised Warrants, if any, to:
------------------------------------
------------------------------------
------------------------------------
Warrantholder:----------------------------------------------
By----------------------------------------------------------
Title:
Dated: ----------------, 199-
[Name of Warrantholder must be identical to name shown in
the registry books of the Company; signature must be
guaranteed by a bank or brokerage firm doing business in the
U.S.]
Warrantholder: -------------------------------------
Address: -------------------------------------
-------------------------------------
-------------------------------------
<PAGE>
FORM OF ASSIGNMENT
[NOTE: Unless the transaction has been registered under the 1933 Act or is
exempt from registration thereunder, this Assignment must be executed, and
the re-issued Warrants must be delivered, outside of the U.S., its
territories and possessions.]
FOR VALUE RECEIVED, the undersigned registered owner of this Warrant
Agreement hereby sells, assigns, and transfers to the Assignee(s) named below
all of the rights of the undersigned under the Warrant Agreement, with respect
to Warrants for the number of shares of Common Stock set forth below:
Name of Assignee Address No. of Shares*
- ---------------- ------- --------------
*Please note that the minimum denomination in which Warrant Agreements may
be issued is 1,000 shares of Common Stock.
Dated: ------------, 19---.
Warrantholder:--------------------------------------
By-----------------------------------
Title:
[Name of Warrantholder must be identical to name
shown in the registry books of the Company;
signature must be guaranteed by a bank or brokerage
firm doing business in the U.S.]
- iv -
[Form of Notice -- Technology Transfer Warrants]
NOTICE TO WARRANTHOLDERS
THE WARRANTS REFERRED TO BELOW AND THE SHARES OF COMMON STOCK UNDERLYING THE
WARRANTS HAVE NOT BEEN REGISTERED FOR ISSUANCE TO THE WARRANTHOLDERS UNDER THE
SECURITIES ACT OF 1933, AS AMENDED ("1933 ACT"), AND MAY NOT BE OFFERED, SOLD,
PLEDGED, OR OTHERWISE TRANSFERRED AND THE WARRANTS MAY NOT BE EXERCISED UNLESS
THE TRANSACTION IS REGISTERED UNDER THE 1933 ACT AND APPLICABLE STATE SECURITIES
LAWS OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE AND THE ISSUER IS
FURNISHED A SATISFACTORY OPINION OF COUNSEL THAT SUCH REGISTRATION IS NOT
REQUIRED.
[Name and Address of Warrantholder]
Reference is made to the warrants ("Warrants") to purchase common
stock, no par value ("Common Stock"), of Epitope, Inc. (the "Company")
originally issued by the Company on August 1, 1993, and the related Warrant
Agreements ("Warrant Agreements") dated as of the same date containing the terms
of the Warrants. Capitalized terms used and not otherwise defined herein have
the same meanings as in the Warrant Agreements.
The Expiration Date for the Warrants, as previously extended, is
September 30, 1997. The Company hereby further extends the Expiration Date until
September 30, 2000.
The Company intends to effect a spin-off of Agritope, Inc.
("Agritope") by making a dividend distribution (the "Distribution") of Agritope
common stock to the Company's shareholders. Subject to and effective ten days
after occurrence of the Distribution, the Company will permit exercise of the
Warrants at a reduced exercise price per share equal to 110 percent of the
average closing price of the Common Stock on The Nasdaq Stock Market for the
five consecutive trading days beginning on the date of the Distribution. The
Company waives payment of the additional Cash Purchase Consideration referenced
in the Warrant Agreements.
Warrantholders will not receive Agritope common stock in the
Distribution with respect to shares of Common Stock issued upon exercise of
Warrants after the record date for the Distribution.
Please attach a copy of this notice to your Warrant Agreement.
Dated: September 12, 1997.
EPITOPE, INC.
By-------------------------------------------------------
Executive Vice President and Chief Financial Officer
<PAGE>
THESE WARRANTS AND THE SHARES OF COMMON STOCK UNDERLYING THESE WARRANTS HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("1933 ACT"), AND
MAY NOT BE OFFERED, SOLD, PLEDGED, OR OTHERWISE TRANSFERRED UNLESS THEY ARE
REGISTERED UNDER THE 1933 ACT AND APPLICABLE STATE SECURITIES LAWS OR UNLESS AN
EXEMPTION FROM REGISTRATION IS AVAILABLE AND THE ISSUER IS FURNISHED A
SATISFACTORY OPINION OF COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.
COMMON STOCK PURCHASED PURSUANT TO THE EXERCISE OF THESE WARRANTS MAY NOT BE
SOLD OR OTHERWISE TRANSFERRED OR DISPOSED OF FOR A PERIOD OF 60 DAYS AFTER THE
DATE OF PURCHASE OF SUCH COMMON STOCK.
VOID AFTER 5 P.M., UNITED STATES PACIFIC TIME,
ON SEPTEMBER 30, 2000
OR SUCH EARLIER DATE AS SPECIFIED HEREIN
WARRANTS TO PURCHASE COMMON STOCK
Warrant No. _______________
_______________ Warrants
EPITOPE, INC.
THIS CERTIFIES THAT
[Name of Warrantholder]
or registered assigns is the registered holder of the number of Warrants (each,
a "Warrant," and collectively, "Warrants") set forth above. Each Warrant
represented by this certificate for Warrants ("Warrant Agreement") entitles the
registered holder thereof (the "Warrantholder") to purchase from Epitope, Inc.,
a corporation incorporated under the laws of the state of Oregon ("Company"),
United States of America ("U.S."), one fully paid and nonassessable share of
common stock, no par value, of the Company ("Common Stock") upon presentation
and surrender of this Warrant Agreement with the accompanying Election to
Exercise Warrants duly completed, at any time prior to 5 P.M., U.S. Pacific
time, on the Expiration Date (as defined in Section 2), at the corporate offices
of the Company at 8505 S.W. Creekside Place, Beaverton, Oregon 97008, or at such
other address as may be specified by the Company pursuant to Section ,
accompanied by payment of the Exercise Price (as defined herein) and any
applicable taxes, either in cash in U.S. funds or by certified or official bank
check in U.S. funds payable to the order of the Company. These Warrants are
issued pursuant to a 1993 Technology Transfer Warrant Issuance Agreement
("Issuance Agreement") among the Company and the Investors described therein
dated as of June 15, 1993.
Section 1. Exercise Price. Each Warrant entitles the Warrantholder to
purchase one share of Common Stock for U.S. $_____ (the "Exercise Price"),
subject to adjustment as provided herein.
Section 2. Expiration. All Warrants not theretofore exercised shall expire at
5 p.m., U.S. Pacific time, on the earlier of the following dates (the
"Expiration Date"): (a) September 30, 2000, and (b) the expiration of 120 days
after the first period of 20 consecutive trading days during which period the
average of the high and low sales prices of the Common Stock on The Nasdaq Stock
Market, or any other exchange or national market system on which the Common
Stock is then traded, is at least $30.00.
- 1 -
<PAGE>
Section 3. Adjustments of Number and Kind of Shares Purchasable and Exercise
Price. The number and kind of securities or other property purchasable upon
exercise of a Warrant shall be subject to adjustment from time to time upon the
occurrence, after the date hereof, of the following events:
3.1 If the outstanding shares of the Company's Common Stock are divided
into a greater number of shares or a dividend in Common Stock is paid on the
Common Stock, the number of shares of Common Stock issuable on exercise of
the Warrants shall be proportionately increased and the Exercise Price in
effect immediately prior to such subdivision or at the record date of such
dividend shall, simultaneously with the effectiveness of such subdivision or
immediately after the record date of such dividend, be proportionately
reduced; and, conversely, if the outstanding shares of Common Stock are
combined into a smaller number of shares of Common Stock, the number of
shares of Common Stock issuable upon exercise of the Warrants shall be
proportionately reduced and the Exercise Price in effect immediately prior to
such combination shall, simultaneously with the effectiveness of such
combination, be proportionately increased. The increases and reductions
provided for in this subsection 3.1 shall be made with the intent and, as
nearly as practicable, the effect that neither the percentage of the total
equity of the Company issuable on exercise of the Warrants nor the price
payable for such percentage upon such exercise shall be affected by any event
described in this subsection 3.1.
3.2 No adjustment of the Exercise Price will be made if the amount of
the adjustment is less than U.S. $.01 per share, but in that case any
adjustment that would otherwise be required to be made will be carried
forward and will be made at the time of and together with the next adjustment
of the Exercise Price which, together with any adjustment carried forward,
amounts to U.S. $.01 per share or more.
3.3 In case of any change in the Common Stock of the Company through
merger, consolidation, reclassification, reorganization, partial or complete
liquidation, or other change in the capital structure of the Company (not
including a combination of shares or the issuance of additional shares of
Common Stock by the Company by stock split or stock dividend), then, as a
condition of the change in the capital structure of the Company, provision
shall be made so that the holder of this Warrant Agreement will have the
right thereafter to receive upon the exercise of the Warrants the kind and
amount of shares of stock or other securities or property to which such
holder would have been entitled if, immediately prior to such merger,
consolidation, reclassification, reorganization, recapitalization, or other
change in the capital structure, such holder had held the number of shares of
Common Stock issuable upon the exercise of the Warrants. In any such case,
appropriate adjustment shall be made in the application of the provisions set
forth herein with respect to the rights and interest thereafter of the
Warrantholder, to the end that the provisions set forth herein shall
thereafter be applicable, as nearly as reasonably may be, in relation to any
shares of stock or other property thereafter deliverable upon the exercise of
the Warrants. The Company will not permit any change in its capital structure
to occur unless the issuer of the shares of stock or other securities to be
received by the holder of this Warrant Agreement, if not the Company, agrees
to be bound by and comply with the provisions of this Warrant Agreement.
3.4 When any adjustment is required to be made in the number of shares
of Common Stock, other securities, or property purchasable upon exercise of
the Warrants, the Company shall promptly determine the new number of shares
or other securities or property purchasable upon exercise of the Warrants and
(a) prepare and retain on file a statement describing in reasonable detail
the method used in arriving at the new number of shares or other securities
or property purchasable upon exercise of the Warrants and (b) cause a copy of
such statement to be mailed to the Warrantholder within thirty (30) days
after the date when the event giving rise to the adjustment occurred.
3.5 No fractional shares of Common Stock or other securities shall be
issued in connection with the exercise of any Warrants, but the Company shall
pay, in lieu of fractional shares, a cash payment therefor on the basis of
the closing price on a national securities exchange on the day immediately
prior to exercise or, if the Common Stock or other securities are not traded
on a national securities exchange
- 2 -
<PAGE>
on such day, on the basis of the fair market value thereof as determined by
the board of directors of the Company, which determination shall be
conclusive.
3.6 Notwithstanding anything herein to the contrary, there shall be no
adjustment made hereunder on account of the sale and issuance of the shares
of Common Stock or other securities purchasable upon exercise of the
Warrants.
Section 4. Rights of Warrantholder as Shareholder. No holder of this Warrant
Agreement shall, as such, be entitled to vote, receive dividends, or be deemed
the holder of Common Stock or any other securities of the Company that may at
any time be issuable on the exercise hereof for any purpose whatever, nor shall
anything contained herein be construed to confer upon the holder of this Warrant
Agreement, as such, any of the rights of a shareholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof or give or withhold consent to any corporate
action (whether upon any matter submitted to shareholders at any meeting thereof
or otherwise) including, without limitation, giving or withholding consent to
any merger, recapitalization, issuance of stock, reclassification of stock,
exchange of stock, change of stock to par value, consolidation or conveyance, or
to receive notice of meetings or other actions affecting shareholders or to
receive dividends or subscription rights or other distributions.
Section 5. Payment of Certain Taxes and Charges. The Company shall not be
required to issue or deliver any certificate for shares of Common Stock or other
securities upon the exercise of Warrants evidenced by this Warrant Agreement or
to register the transfer of the Warrants evidenced hereby until any applicable
transfer tax and any other taxes or governmental charges that the Company may be
required by law to collect in respect of such exercise or transfer shall have
been paid, such tax being payable by the holder of this Warrant Agreement at the
time of surrender for exercise or transfer.
Section 6. Registration. The Company has prepared a registration statement on
Form S-3 (the "Registration Statement") under the 1933 Act with respect to the
resale by the Warrantholder of the shares of Common Stock issued or issuable
upon exercise of this Warrant Agreement (the "Warrant Shares"). As soon as
practicable after the original issue date of this Warrant Agreement (the
"Original Issue Date"), the Company shall file the Registration Statement with
the U.S. Securities and Exchange Commission and shall use its best efforts to
cause the Registration Statement to become effective under the 1933 Act as
promptly as practicable after the Original Issue Date as provided for in, and in
accordance with, the terms and conditions of the Issuance Agreement.
Section 7. Transfer and Exchange.
7.1 Transfer. This Warrant Agreement is transferable on the registry
books of the Company subject to the restrictions on the first page hereof and
in Section 7.4. The Company may deem and treat the person or entity in whose
name this Warrant Agreement is registered as the absolute owner hereof
(notwithstanding any notation of ownership or other writing thereon made by
anyone other than the Company) for all purposes whatever, and the Company
shall not be affected by any notice to the contrary.
7.2 Exchange. Subject to the provisions of Section and the restrictions
on the first page hereof, this Warrant Agreement is exchangeable at the
principal office of the Company for Warrant Agreements to purchase the same
aggregate number of shares of Common Stock as are purchasable hereunder, each
new Warrant Agreement to represent the right to purchase such number of
shares as the Warrantholder shall designate at the time of such exchange.
7.3 Securities Act of 1933. The Warrantholder, by acceptance hereof,
agrees that this Warrant Agreement and the shares of Common Stock issued or
issuable upon exercise of this Warrant Agreement may not be offered or sold
except in compliance with the 1933 Act. The Warrantholder consents to the
Company's making a notation on its records and on the certificates for any
shares of Common Stock issued upon exercise hereof in order to implement such
restriction on transferability.
- 3 -
<PAGE>
7.4 Minimum Warrant Agreement Amount. Notwithstanding the provisions of
Section 7.1 and Section , the Company shall not be required to issue a
Warrant Agreement for Warrants covering less than 1,000 shares of Common
Stock, except in the case of a partial exercise by the Warrantholder of this
Warrant Agreement that leaves Warrants exercisable to purchase less than
1,000 shares that are to remain registered in the name of the exercising
Warrantholder, and any subsequent partial exercise, transfer, or exchange of
such Warrant Agreement.
7.5 No Transfer of Common Stock for 60 Days. Common Stock purchased
pursuant to the exercise of these Warrants may not be sold or otherwise
transferred or disposed of for a period of 60 days after the date of purchase
of such Common Stock.
Section 8. Holdback Agreement. The Warrantholder, if requested by the Company
and an underwriter of the Company's securities, shall agree not to sell or
otherwise transfer or dispose of any Warrants or Warrant Shares for a specified
period of time (not to exceed 90 days) following the effective date of a
registration statement pursuant to which the Company proposes to sell its
securities to the public generally; provided, however, that all executive
officers and directors of the Company enter into similar agreements.
Section 9. Notices. Any notice, request, or other communication required or
permitted hereunder shall be in writing and shall be deemed to have been duly
given if delivered personally or by certified mail, postage prepaid, return
receipt requested, to: (a) the Company at 8505 S.W. Creekside Place, Beaverton,
Oregon 97008, Attn: Secretary, with a copy to Miller, Nash, Wiener, Hager &
Carlsen, 3500 U.S. Bancorp Tower, 111 S.W. Fifth Avenue, Portland, Oregon
97204-3699, Attn: Erich W. Merrill, Jr. and (b) to the Warrantholders at the
addresses set forth in the registry books of the Company referred to in Section
7.1. Any notice, request, or other communication given by certified mail shall
be deemed given 10 days after the mailing date; notices, requests, or other
communications given in any other manner shall be deemed given when received.
Section 10. Amendment. This Warrant Agreement may be amended or its
provisions waived only by an instrument in writing signed by the Company and the
Warrantholder as provided in the Issuance Agreement.
Section 11. Law Governing. This Warrant Agreement shall be governed by and
construed in accordance with the laws of the state of Oregon, without giving
effect to choice of laws principles thereof.
Dated as of _______________.
EPITOPE, INC.
By----------------------------------------
- 4 -
<PAGE>
ELECTION TO EXERCISE WARRANT
To: Epitope, Inc.
8505 S.W. Creekside Place
Beaverton, Oregon 97008
The undersigned hereby exercises the within Warrant Agreement for
________ shares of the Common Stock of Epitope, Inc. ("Warrant Shares"), and
tenders payment herewith in the amount of U.S. $_________ in accordance with the
terms thereof.
THE WARRANTS MAY NOT BE EXERCISED UNLESS THE TRANSACTION IS REGISTERED UNDER THE
1933 ACT AND APPLICABLE STATE SECURITIES LAWS OR UNLESS AN EXEMPTION FROM
REGISTRATION IS AVAILABLE AND THE ISSUER IS FURNISHED A SATISFACTORY OPINION OF
COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.
THE UNDERSIGNED HEREBY AGREES NOT TO SELL OR OTHERWISE TRANSFER OR DISPOSE OF
THE WARRANT SHARES FOR A PERIOD ENDING 60 DAYS AFTER THE DATE OF PURCHASE OF THE
WARRANT SHARES.
Please deliver the certificate and a new Warrant Agreement for the
unexercised Warrants, if any, to:
------------------------------------
------------------------------------
------------------------------------
Warrantholder:--------------------------------------
By--------------------------------------------------
Title:
[Name of Warrantholder must be identical to name
shown in the registry books of the Company;
signature must be guaranteed by a bank or brokerage
firm doing business in the United States.]
Dated: -------------, 199--.
Warrantholder: -------------------------------------
Address: -------------------------------------------
-------------------------------------------
-------------------------------------------
<PAGE>
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned registered owner of this Warrant
Agreement hereby sells, assigns, and transfers to the Assignee(s) named below
all of the rights of the undersigned under the Warrant Agreement, with respect
to Warrants for the number of shares of Common Stock set forth below:
Name of Assignee Address No. of Shares*
- ---------------- ------- --------------
*Please note that the minimum denomination in which Warrant Agreements may be
issued is 1,000 shares of Common Stock.
The undersigned agrees to furnish to the Company upon request a
satisfactory opinion of counsel to the effect that the transfer requested above
is exempt from the Securities Act of 1933, as amended, and applicable state
securities laws.
Dated: --------------, 19---.
Warrantholder: ------------------------------------
By--------------------------------------------------
Title:
[Name of Warrantholder must be identical to name
shown in the registry books of the Company;
signature must be guaranteed by a bank or brokerage
firm doing business in the United States.]
- 6 -
