[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
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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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
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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
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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.
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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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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.
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(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.
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:
------------------------------------
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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: -------------------------------------
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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*
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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 U.S.]
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