EPITOPE, INC.
988,390 SHARES
EPITOPE, INC.
COMMON STOCK
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This prospectus covers the sale of up to 988,390 shares of our
common stock by the selling stockholders identified on page 9 of this
prospectus. The shares covered by this prospectus are issuable upon the exercise
of outstanding warrants originally sold in 1992. We are not selling any shares
of our common stock, and we will not receive any part of the proceeds from sales
of registered shares, other than the exercise price for the warrants.
The selling stockholders may sell the shares described in this
prospectus in a number of ways and at varying prices. For a more detailed
description of the manner in which the shares may be sold, you should refer to
the section entitled "Plan of Distribution" on page 12.
Our common stock is traded on the Nasdaq National Market under
the symbol "EPTO." On April 3, 2000, the last reported sale price for our shares
was $10.125.
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INVESTMENT IN OUR SHARES INVOLVES A HIGH DEGREE OF RISK. YOU
SHOULD CAREFULY CONSIDER THE RISK FACTORS DESCRIBED BEGINNING ON PAGE 3.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
CONTRARY REPRESENTATION IS A CRIMINAL OFFENSE.
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THE DATE OF THIS PROSPECTUS IS APRIL 3, 2000.
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You should rely only on the information contained or incorporated
by reference in this prospectus and any accompanying supplements. No one has
been authorized to provide you with any other information in respect of this
offering of shares. You should not assume that the information in this
prospectus or any supplement is current as of any date other than the date set
forth on the document.
TABLE OF CONTENTS
PAGE
RISK FACTORS.................................................................3
ABOUT THE COMPANY............................................................8
USE OF PROCEEDS..............................................................9
DIVIDEND POLICY..............................................................9
SELLING STOCKHOLDERS.........................................................9
PLAN OF DISTRIBUTION........................................................12
WHERE YOU CAN FIND MORE INFORMATION ABOUT US................................12
LEGAL MATTERS...............................................................13
EXPERTS.................................................................... 13
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RISK FACTORS
You should consider the following factors, among others discussed
in this prospectus or incorporated by reference from our other periodic
disclosures with the Securities and Exchange Commission, in making a decision
concerning the purchase of shares described in this prospectus.
WE HAVE A HISTORY OF LOSSES AND PROSPECTS FOR FUTURE
PROFITABILITY ARE UNCERTAIN.
We have experienced significant operating losses since our
incorporation. Our ability to increase revenues and consistently achieve
profitability and positive cash flows from operations will depend in substantial
part on successful commercialization of our OraSure(R) specimen collection
device for HIV and other diseases, for drugs of abuse, and other uses currently
under development. In addition, we will likely have to develop new products and
other uses for OraSure to achieve long-term success. Our development efforts may
or may not result in commercially viable products or expanded uses of OraSure.
Even if we do develop new products or new uses, we may not obtain required
regulatory clearances or approvals. Accordingly, it is not clear that we will be
able to achieve profitability in the future. We have not achieved positive cash
flows from our operations.
OUR ABILITY TO SELL OUR PRODUCTS IN INTERNATIONAL MARKETS MAY BE
LIMITED BY CERTAIN OBSTACLES, INCLUDING REGULATORY AND CULTURAL CONSTRAINTS.
We are devoting significant resources to international sales of
our products. In the past, we have had little direct experience with the
governmental regulatory agencies in many countries that control sale of our
products into those countries. We have experienced extended delays in obtaining
approvals to make sales in Argentina and Greece, demonstrating that compliance
with foreign regulatory requirements can be difficult and impede international
marketing efforts. In addition to economic and political issues, a number of
factors can slow or prevent international sales, including among others those
set forth below:
o Regulatory requirements in general or more stringent regulation
of testing products in particular may slow, limit, or prevent the
offering of our products in foreign jurisdictions;
o Cultural and political differences may make it difficult to
effectively market, sell and gain acceptance of our products in
foreign jurisdictions;
o Inexperience in international markets may slow or limit our
ability to sell our products in foreign countries; and
o Additional regulations and regulatory processes may affect sales
of our products.
Some of these factors may cause the costs of our international
sales to exceed significantly our domestic costs of doing business.
WE MAY BE DEPENDENT ON RAISING ADDITIONAL CAPITAL AND MAY FACE
DIFFICULTIES RAISING FINANCING.
We have historically depended to a substantial degree on capital
raised through the sale of equity securities to fund our operations and may
again have to raise money in the future. Our future liquidity and capital
requirements will depend on various factors affecting our business. For
instance, if our efforts to develop new products are unsuccessful, or our
competitors introduce products that compete
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successfully with ours, we may need additional funds sooner than expected to
continue our operations. Similarly, if we decide that it is necessary to expand
our manufacturing capacity, to acquire other businesses, or to make additional
investments in sales and marketing, we would likely require additional
financing. We may seek to raise funds through the public or private sale of our
equity securities, through additional collaborative arrangements, or from other
sources. Equity financing may not be available on satisfactory terms or at all.
If we were, instead, to enter into collaborative arrangements, such
arrangements, if available, would likely require us to relinquish rights in
certain technologies or share product revenues.
IF WE DO NOT COMPLY WITH GOVERNMENT REGULATIONS, WE COULD BE
FORCED TO STOP MANUFACTURING OUR PRODUCTS.
We are permitted to manufacture and sell the OraSure device and
other regulated products, both in the U.S. and in some cases abroad, only if we
comply with regulations of government agencies such as the United States Food
and Drug Administration (FDA). We have implemented quality assurance and other
systems that are intended to comply with applicable regulations in the United
States. The FDA has issued a warning letter to us stating that we were not in
compliance with applicable Quality System Regulations, although no further
action has been taken. We have attempted to address concerns raised by the FDA
by improving and implementing new manufacturing and process control procedures.
In 1999, we hired an individual to serve as Vice President of Regulatory Affairs
and Quality Assurance. Although we believe that we are satisfactorily addressing
the points raised by the FDA, the FDA could force the Company to stop
manufacturing products if the FDA concludes that we are out of compliance with
applicable regulations. In addition, until the FDA agrees that we have resolved
all points raised in the warning letter, we may not be able to obtain regulatory
clearance certificates needed in some foreign countries.
OUR FUTURE FINANCIAL RESULTS DEPEND ON OUR ABILITY TO DEVELOP
PRODUCT DISTRIBUTION CHANNELS AND ARE LARGELY DEPENDENT ON THE EFFORTS OF THIRD
PARTIES.
We have marketed most of our products by collaborating with
pharmaceutical and diagnostic companies and distributors. For example, our
EPIblot(R) and OraSure HIV-1 Western blot confirmatory tests are distributed
through Organon Teknika Corporation, a member of the Akzo Pharma group of Akzo
Nobel, N.V. based in the Netherlands. In addition, the OraSure collection device
is distributed to the insurance industry through major insurance testing
laboratories, and we have entered into an agreement with STC Technologies, Inc.
to distribute the OraSure device for drugs-of-abuse testing under the trade name
Intercept(R) Drugs of Abuse. Except in the public health market, we do not
maintain a substantial sales or marketing force. As a result, our revenues are
largely derived from sales of our products within markets in which we are
dependent upon the efforts and capabilities of others to market our products.
Our partners may or may not have sufficient incentives to sell and market our
products, may be subject to financial or other difficulties affecting their
distribution ability, or may have other priorities. Our dependence on others may
affect our financial results and subject us to fluctuations in sales based on
sales and marketing efforts and inventory policies of our key marketing
partners.
WE RELY ON FOREIGN THIRD PARTY DISTRIBUTORS TO MARKET OUR
PRODUCTS AND ASSIST US IN FOREIGN MARKETS AND OUR INTERNATIONAL SALES COULD BE
IMPEDED IF WE LOSE DISTRIBUTORS OR IF OUR DISTRIBUTORS FAIL TO MEET OUR
EXPECTATIONS.
We rely on the cooperation of distributors to market our products
in foreign countries and to register and provide technical support for the
laboratory tests which may be used with OraSure. Problems with our distributor
relationships or changes in distributors can interfere with the sales process,
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particularly in cases in which regulatory approvals or registrations are in the
name of the former distributor.
OUR FINANCIAL SUCCESS WILL DEPEND ON OUR ABILITY TO EXPAND
PRODUCT USES AND DEVELOP NEW PRODUCTS.
Our OraSure collection device is becoming recognized in the
insurance and public health markets as reliable and effective. Our long-term
strategy is based on continued expansion of existing markets for OraSure, the
creation of new markets for OraSure based on new uses, and the development of
new products. New products such as OraQuick(R) are in various stages of
development. We will be required to achieve difficult scientific or technical
objectives before the commercial or technological feasibility of our new
products can be demonstrated. Our products under development may not perform in
accordance with our expectations. Even if they do perform to expectations, there
is a risk that required regulatory approvals will not be obtained. Pricing
pressures also may make it difficult for us to profitably manufacture,
distribute, and sell new and existing products.
WE FACE PRESSURE FROM THE DEVELOPMENT OF COMPETING PRODUCTS THAT
MAY LIMIT MARGINS ON OUR PRODUCTS AND POSSIBLY MAKE OUR PRODUCTS RELATIVELY
UNATTRACTIVE TO OUR CUSTOMERS OR OBSOLETE.
Competition in the medical products business is intense and will
likely increase. We believe that the principal competition for OraSure will come
from blood-based and urine-based assays, and could also come from other
oral-fluid tests. New testing methods could be developed in the future that
render our products uneconomical or obsolete. Most of our competitors have
significantly greater financial resources than ours and are more experienced in
the sales, marketing, and development of medical products. We may experience
competitive pressures, particularly with respect to pricing, that could
adversely affect our ability to achieve and maintain profitability.
WE NEED PURCHASERS WITHIN THE MARKET FOR TESTING PRODUCTS TO
ACCEPT ORAL TESTING PRODUCTS AS AN ALTERNATIVE TO TRADITIONAL BLOOD-BASED OR
URINE-BASED TESTING.
We have made significant progress in gaining acceptance of oral
testing for HIV in the insurance and public health markets. We also anticipate
that oral testing for drugs-of-abuse will be accepted to some degree in
employment testing. Other markets, particularly the physician market, may resist
the adoption of oral testing as a replacement for other testing methods in use
today. Any failure to achieve broader market acceptance of our products may
limit our potential sales growth.
WE FACE EXTENSIVE GOVERNMENT REGULATION THAT MAY LIMIT OUR
ABILITY TO DEVELOP NEW PRODUCTS OR NEW USES FOR EXISTING PRODUCTS AND MAY AFFECT
THE COSTS INVOLVED IN CONDUCTING OUR OPERATIONS.
Human therapeutic and diagnostic products such as ours are
subject to government regulation, including pre-marketing approval by the FDA
and comparable agencies in foreign counties. The process of obtaining these
approvals varies according to the nature and use of the product and can involve
lengthy and detailed laboratory and clinical testing, sampling activities and
other costly and time-consuming procedures. Approval, if it can be obtained, may
take several years. In addition, we are subject to ongoing oversight by the FDA.
Compliance with relevant regulations and other requirements can be costly and
time-consuming, and we may not be able economically, if at all, to comply with
applicable requirements or obtain necessary approvals. Regulatory agencies may
at any time impose additional regulations on us that are costly to comply with
and disruptive to our operations.
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OUR BUSINESS COULD BE AFFECTED BY CHANGES IN FEDERAL OR STATE LAW
OR REGULATIONS.
Changes in government regulations could require us to undergo
additional trials or procedures and change our manufacturing process or that of
our partners, and could make it impractical or impossible for us to market our
products for certain uses or for sale in certain markets. Other changes in
government regulations, such as the adoption of the FDA's Quality System
Regulations, may not affect our products directly but may nonetheless adversely
affect our ability to achieve and maintain profitable operations by requiring
that we incur significant expenses changing or implementing new manufacturing
and process control procedures.
THIS AND OTHER OFFERINGS MAY ADVERSELY AFFECT THE MARKET PRICE
FOR OUR COMMON STOCK.
The number of shares of our common stock covered by this
prospectus or currently effective registration statements covering the sale of
shares issuable upon exercise of other outstanding warrants is 2,537,307 shares,
representing approximately 17.8 percent of the total shares of our common stock
outstanding as of December 31, 1999. There are no restrictions on the sale of
any of these shares other than a mandatory 60-day hold provision applicable to
certain warrants. A significant number of the outstanding warrants have been
exercised recently due to recent increases in the market price of our common
stock. Accordingly, a significant number of shares of our common stock may be
sold in the foreseeable future. If holders of outstanding warrants were to offer
a large number of shares simultaneously or at approximately the same time, the
market price of our common stock would likely decline.
WE ARE DEPENDENT ON OUR KEY PERSONNEL.
We are a relatively small company with few executive officers,
and we therefore depend to a large extent on the abilities and continued
participation of our executive officers and scientific personnel. Robert D.
Thompson, our new president and chief executive officer, and William D. Block,
our vice president of sales and marketing, are expected to play a key role in
our future operations. Andrew S. Goldstein, vice president, J. Richard George,
chief scientific officer, and Charles E. Bergeron, chief financial officer, have
been with us for extended periods and are key to the scientific and financial
aspects of our operations and implementation of our business plan. The loss of
any of these key personnel could adversely affect our business. Competition for
management and scientific staff in the medical products field is intense. We may
experience difficulties attracting and retaining personnel with sufficient
experience and expertise to satisfy our needs.
OUR PATENTS AND PROPRIETARY INFORMATION MAY NOT STOP COMPETITORS.
We have obtained certain patents, have or may in the future
acquire license rights under other patents, and have filed and may file in the
future other patent applications. Patents that we have applied for may not be
obtained, and patents are always subject to challenge. Patents that we obtain
may not result in any material advantage over competitors because competitors
may be able to produce products competing with a patented product without
infringing on our patent rights. Even if we have a patent that we believe is
infringed, the cost of enforcing our patent rights in court would be high. If we
need to defend ourselves against infringement charges by other patent holders,
the defense would likely be expensive and interfere with our operations. We
intend to obtain patent protection in only a limited number of foreign
countries. The requirements for a patent and degree of protection afforded by a
patent in foreign countries may differ from those in the United States.
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WE FACE RISKS RELATING TO PRODUCT LIABILITY AND PRODUCT RECALLS.
We could be subject to claims for personal injuries or other
damages resulting from our products or services, or product recalls. In
particular, we face litigation risk in the event of false positive or false
negative results resulting from our oral testing products. A successful claim or
series of claims or a recall of our products could severely damage our financial
position. We carry liability insurance against the negligent acts of our
employees and a general liability insurance policy that includes coverage for
product liability. The insurance is expensive, may not be available in the
future on acceptable terms, if at all, and may not adequately protect us against
all such liabilities. In addition, we may require increased product liability
coverage as new products are commercially developed.
OUR SHARE PRICE IS VOLATILE AND WE DO NOT PAY DIVIDENDS ON OUR
COMMON STOCK.
The market prices for our stock, and for the securities of
medical technology companies in general, historically have been volatile. Many
factors, including those described below, may lead to fluctuations:
o announcements of technological innovations or new commercial
products by us or our competitors;
o changes in governmental regulations making it more difficult to
market our products in the United States or abroad or that enable
competitors to market competing products;
o developments with respect to patent or proprietary rights;
o additions or departures of key personnel;
o success or failure in opening new international markets for our
products and completing sales; and
o regulatory actions affecting our operations.
In addition, market conditions in general may have a significant
impact on the market price for our stock. As a result, it may be difficult for
you to plan for sales of our stock or sell your stock at a desired time or
price. We have not paid cash dividends on our common stock to date, and we do
not anticipate paying cash dividends in the foreseeable future.
ANTI-TAKEOVER CONSIDERATIONS COULD MAKE AN ACQUISITION BY A
THIRD-PARTY DIFFICULT, LIMITING THE ABILITY OF STOCKHOLDERS TO OBTAIN A PREMIUM
FOR THEIR STOCK AS A RESULT OF A CHANGE IN CONTROL.
Oregon corporate law contains provisions that could make it more
difficult for a third party to acquire, or discourage a third party from
attempting to acquire, control of the company without the approval of our board
of directors. Our articles of incorporation contain provisions designed to
prevent sudden changes in the composition of the board of directors, and we have
adopted a shareholder rights plan which could have the effect of discouraging
the sale of the company or bids for our common stock. Also, many stock options
under our stock awards plan will vest in full immediately in the event of a
change in control of the company or similar event. All of these considerations
may discourage tender offers or other bids for our common stock and make it more
difficult for you to obtain a premium for the sale of your shares in connection
with a change in control of the company.
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ABOUT THE COMPANY
Below is a brief summary of our business. You should carefully
review the section in this prospectus entitled "Risk Factors" and our periodic
reports filed with the Securities and Exchange Commission, including our Annual
Report on Form 10-K for the year ended September 30, 1999, and our Quarterly
Report on Form 10-Q for the quarter ended December 31, 1999, for more
information about our business.
We develop, manufacture, and market oral specimen collection
devices and diagnostic products primarily for the detection of antibodies to the
Human Immunodeficiency Virus (HIV), the cause of AIDS, and for the detection of
cocaine and tobacco use. Our lead product is the patented OraSure(R) collection
device. OraSure is used in conjunction with an oral specimen diagnostic test. We
market the device in the United States and certain foreign countries for use in
screening life insurance applicants and for public health use. On February 2,
2000, we began marketing OraSure for drugs-of-abuse testing in collaboration
with STC Technologies, Inc., under STC's trademark Intercept(TM) Drugs of Abuse.
The OraSure device consists of a small, treated cotton-fiber pad
on a nylon handle that is placed in the patient's mouth for two minutes. The
device collects oral mucosal transudate (OMT), a serum-derived fluid that
contains higher concentrations of antibodies than saliva, including HIV
antibodies in people infected with the virus. As a result, OMT testing is a
highly accurate method for detecting HIV infection. Because OraSure uses a
noninvasive, needle-free collection method without need for privacy during the
collection process, we believe that oral fluid testing has several significant
advantages over blood or urine-based tests for both healthcare professionals and
patients.
We have developed and introduced other products, including the
Orasure HIV-1 Western blot and EPIblot(R) tests used to confirm positive initial
screening tests. The OraSure HIV-1 Western blot confirmatory test kit is used in
conjunction with oral-specimen based screening tests, while EPIblot is used in
conjunction with blood-based screening tests. The Western blot test kits are
distributed worldwide under an exclusive agreement with Organon Teknika
Corporation. We are developing a new product called OraQuick(R), a rapid-format
oral specimen and blood-based test designed to provide results in approximately
15 minutes, and are exploring the potential use of our technologies and products
for DNA collection and other applications.
We were incorporated under the laws of the state of Oregon in
1981. Our principal executive offices and laboratories are located at 8505 S.W.
Creekside Place, Beaverton, Oregon 97008 and our telephone number is (503)
641-6115. Our website can be found at www.epitope.com. Information contained on
our website is not part of this prospectus.
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USE OF PROCEEDS
We will not receive any proceeds from the sale of the shares of
common stock offered by the selling stockholders.
DIVIDEND POLICY
We have never declared or paid cash dividends on our common
stock, and we do not intend to pay dividends in the foreseeable future.
SELLING STOCKHOLDERS
The common stock registered for sale pursuant to this prospectus
is issuable upon exercise of outstanding warrants originally sold to investors
in 1992. The warrants were originally sold to investors in a sale of securities
exempt from registration under Regulation S of the Securities Act of 1933. We
will not receive any proceeds from the sale of shares of common stock by the
selling stockholders, other than the exercise price for the warrants.
The following table sets forth information as of February 1,
2000, relating to the beneficial ownership of our common stock by each selling
stockholder. The number and percentages of shares beneficially owned set forth
below are based on 14,261,887 shares outstanding at December 31, 1999, and have
been determined in accordance with Rule 13d-3 under the Securities Exchange Act
of 1934. Under this rule, beneficial ownership includes any shares as to which a
person has sole or shared voting or dispositive power or may, within 60 days of
December 31, 1999, acquire such power. In accordance with Rule 416 under the
Securities Act, this prospectus also covers an undetermined number of additional
shares as may become issuable as a result of adjustments in the exercise price
of the warrants to prevent dilution. The information in the table below was
supplied by the selling stockholders.
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SELLING SHAREHOLDERS COMMON STOCK OWNED COMMON STOCK COMMON STOCK
PRIOR TO OFFERING OFFERED OWNED AFTER
OFFERING (1)(2)
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<S> <C> <C> <C>
Samisa Investment Corp. (3) 328,650 146,750 181,900
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Societe de Bourse Ferri Ref: 242,940 142,940 100,000
Financiere de l'Echiquier (4)
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Republic New York Securities 110,500 110,500 -
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Rush & Co. (5) 140,000 100,000 40,000
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Vitali Maritime Corp. (6) 104,385 67,500 36,885
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Simark & Co. 45,600 45,600 -
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Erem SA (7) 73,280 43,280 30,000
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Mizebourne Investment Corp. (8) 48,425 37,500 10,925
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Savill Ltd. (9) 34,300 34,000 300
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John Watling (10) 37,000 31,000 6,000
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Banque Finama (11) 46,000 28,000 18,000
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Aegis Trust Ltd. 22,320 22,320 -
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SELLING SHAREHOLDERS COMMON STOCK OWNED COMMON STOCK COMMON STOCK
PRIOR TO OFFERING OFFERED OWNED AFTER
OFFERING (1)(2)
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Bittar International (12) 101,000 20,000 81,000
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Societe Financier Privee 12,500 12,500 -
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Hare & Co. 12,400 12,400 -
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Brown Brothers Harriman & Co. (13) 11,500 11,000 500
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Cogeval SA 10,000 10,000 -
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Eldorado Navegacion 10,000 10,000 -
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Glebe Investment Corp. (14) 60,000 10,000 50,000
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J. Vontobel & Co. 10,000 10,000 -
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Fidelidad Compania Naveria SA 8,000 8,000 -
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Camforin Ltd. (15) 41,518 7,500 34,018
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Taragona Ltd. (16) 43,016 7,500 35,516
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Trackway Ltd. (17) 43,016 7,500 35,516
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Marpresagio Compania a Naviera 11,650 7,000 4,650
SA (18)
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Maison Antoine Baud 6,000 6,000 -
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Pluvalca Management (19) 14,800 5,500 9,300
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Codista SA 5,000 5,000 -
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Grangethorpe Pension Scheme 5,000 5,000 -
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Pictet & Cie 5,000 5,000 -
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Banque Privee Edmond de Rothschild 4,000 4,000 -
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Erik H. Loudon 3,000 3,000 -
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Prime Grieb & Co. Ltd. 3,000 3,000 -
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Bank Audi (Geneva) 2,500 2,500 -
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Emerge Capital (20) 125,000 2,000 123,000
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Societe de Bourse Ferri 1,900 1,900 -
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Eric Edelfelt 1,700 1,700 -
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Sigler & Co. 1,000 1,000 -
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</TABLE>
(1) Assumes the sale of all securities listed in the "Common Stock Offered"
column. Also assumes that none of the Selling Shareholders sell
securities not listed in such column or purchase additional securities.
(2) Except as otherwise noted, no selling shareholder will beneficially own
greater than 1 percent of the outstanding common stock following
completion of this offering.
(3) Includes 29,900 shares of common stock issuable upon exercise of other
warrants originally purchased in 1991 ("1991 Warrants"), 102,000 shares
issuable upon exercise of warrants
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originally purchased in 1993 ("1993 Warrants") and 50,000 shares
issuable upon exercise of other warrants issued to the selling
stockholder. Samisa Investment Corp. will beneficially own 1.3 percent
of our outstanding common stock following completion of this offering.
(4) Includes 100,000 shares issuable upon exercise of 1993 Warrants.
(5) Includes 40,000 shares issuable upon exercise of 1993 Warrants.
(6) Includes 10,450 shares issuable upon exercise of 1991 Warrants, 7,500
shares issuable upon exercise of 1993 Warrants, and 18,935 shares of
common stock.
(7) Includes 30,000 shares issuable upon exercise of 1993 Warrants.
(8) Includes 3,425 shares issuable upon exercise of 1993 Warrants and 7,500
shares issuable upon exercise of 1993 Warrants.
(9) Includes 300 shares issuable upon exercise of 1991 Warrants.
(10) Includes 6,000 shares issuable upon exercise of 1993 Warrants.
(11) Includes 18,000 shares issuable upon exercise of 1993 Warrants.
(12) Includes 81,000 shares issuable upon exercise of 1993 Warrants.
(13) Includes 500 shares issuable upon exercise of 1991 Warrants.
(14) Includes 50,000 shares issuable upon exercise of 1993 Warrants.
(15) Includes 2,350 shares issuable upon exercise of 1991 Warrants and 31,668
shares issuable upon exercise of 1993 Warrants.
(16) Includes 3,850 shares issuable upon exercise of 1991 Warrants and 31,666
shares issuable upon exercise of 1993 Warrants.
(17) Includes 3,850 shares issuable upon exercise of 1991 Warrants and 31,666
shares issuable upon exercise of 1993 Warrants.
(18) Includes 4,650 shares issuable upon exercise of 1991 Warrants.
(19) Includes 9,300 shares issuable upon exercise of 1991 Warrants.
(20) Includes 75,000 shares issuable upon exercise of 1991 Warrants and
48,000 shares issuable upon exercise of 1993 Warrants.
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PLAN OF DISTRIBUTION
The shares of common stock being offered pursuant to this
prospectus will be issued upon exercise of outstanding warrants and may be sold
from time to time by the selling stockholders, or by pledgees, donees,
transferees, or other successors in interest. The shares may be sold on The
Nasdaq Stock Market or otherwise at prices and at terms then prevailing or in
negotiated transactions. The shares may be sold by one or more of the following:
(a) a block trade in which the broker or dealer effecting the
trade will attempt to sell the securities as agent but may
purchase and resell a portion of the block as principal to
facilitate the transaction;
(b) a purchase by a dealer as principal and resale by the
dealer for its account; and
(c) in ordinary brokerage transactions and transactions in
which the broker solicits purchasers, which may include
put or call option transactions, short sales or other
methods of sale.
Brokers or dealers may receive commissions or discounts in amounts to be
negotiated prior to the sale. Brokerage commissions and similar selling expenses
will be borne by the selling stockholders.
The selling stockholders and any broker-dealers that act in
connection with the sale of shares may be deemed "underwriters" within the
meaning of Section 2(11) of the Securities Act of 1933 and any commissions
received by such broker-dealers and any profit on the resale of shares sold by
them while acting as principals might be deemed underwriting discounts or
commissions under the Securities Act. The selling stockholders have been
informed that they will be required to deliver a prospectus in connection with
sales of shares. Selling stockholders may also resell any portion of their
shares in open market transactions in reliance upon and in compliance with Rule
144 once the requirements of the rule have been met.
Each selling stockholder and any person participating in a
distribution will be subject to the Securities Exchange Act of 1934, which may
limit the timing of purchases and sales of shares and the ability of
participants to engage in certain market activities.
We have agreed to indemnify the selling stockholders against
certain liabilities in connection with the distribution of the securities
offered in this prospectus, including liabilities under the Securities Act of
1933. Under agreements that may be entered into by a selling stockholder,
dealers who participate in the distribution of shares may be entitled to
indemnification by the selling stockholder against certain liabilities,
including liabilities under the Securities Act.
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WHERE YOU CAN FIND MORE INFORMATION ABOUT US
This prospectus is part of a registration statement that we have
filed with the Securities and Exchange Commission. This prospectus does not
contain all of the information that can be found in the registration statement.
Please see the registration statement for additional information about us.
We file annual, quarterly and current reports, proxy statements,
and other information with the SEC. You may read and copy any information we
file with the SEC at the SEC's public reference room at 450 Fifth Street, N.W.,
Washington, D.C. 20549. You may receive copies of these documents from the SEC
by writing the SEC and paying a fee for copying costs, and you can obtain
information on the operation of the public reference room by calling the SEC at
1-800-732-0330. Our SEC filings are also available to the public on the SEC
internet site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" into this
prospectus certain information contained in our publicly-filed documents. This
means that important information is disclosed to you by referring you to those
documents. The information that is incorporated by reference is considered to be
a part of this prospectus, and information that we file later with the SEC will
automatically update and supersede previously filed information in this
prospectus and in other documents.
We incorporate by reference the documents listed below:
(1) Our Annual Report on Form 10-K for the year ended September 30,
1999;
(2) Our Quarterly Report on Form 10-Q for the quarter ended December
31, 1999;
(3) Our current report on Form 8-K dated October 1, 1999; and
(4) Our description of our common stock which is contained in Exhibit
99.1 to our Current Report on Form 8-K dated December 24, 1997.
In addition, all documents filed by us pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after the date
of this prospectus will also be incorporated by reference.
You may request free copies of all of these filings (without
exhibits) by writing or telephoning us. You should direct requests to Andrew S.
Goldstein, Secretary, Epitope, Inc., 8505 S.W. Creekside Place, Beaverton,
Oregon 97008; telephone - (503) 641-6115.
LEGAL MATTERS
The validity of the shares of common stock offered in this
prospectus has been passed upon by Miller Nash LLP, Portland, Oregon.
EXPERTS
The financial statements incorporated in this Prospectus by
reference to the Annual Report on Form 10-K for the year ended September 30,
1999, have been so incorporated in reliance upon the report of
PricewaterhouseCoopers LLP, independent accountants, given upon the authority of
said firm as experts in auditing and accounting.
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