BEAVERTON, Ore., May 6 /PRNewswire/ -- Epitope, Inc. (Nasdaq: EPTO) today announced that it has signed an agreement with the former owners of Andrew and Williamson Sales Co. (A&W) to rescind its December 1996 acquisition of A&W. The former owners will return all 520,000 shares of Epitope common stock in exchange for the A&W common stock Epitope received in the December transaction. Epitope will also receive A&W Class A and Class B nonvoting preferred stock with a liquidation preference of $5.7 million, in satisfaction of intercompany loans in that amount. The preferred stock will receive dividends equal to any dividends paid on the common stock. A&W will redeem all Class A shares for $2.2 million, payable in annual installments of $440,000 beginning April 15, 2000. A&W may redeem the 100 Class B shares at its option for $28,000 per share until April 15, 2002, and for $31,500 per share thereafter. Two former owners will operate the business and will guaranty the $6.5 million line of credit provided by A&W's bank. The credit line, under which loans of approximately $3 million are currently outstanding, is secured by A&W accounts receivable and inventory. Epitope will continue its guaranty of the facility through November 1, 1998. Epitope, A&W and the former A&W owners will release each other from liabilities arising from events occurring before the rescission, including claims asserted in a lawsuit Epitope filed against A&W and the former owners in April 1997. A&W will indemnify Epitope for certain third party claims. The agreement is subject to the satisfaction of certain conditions which are expected to be satisfied in the near future. "Recent events have convinced us that A&W is no longer a suitable distribution arm for the fruit and vegetable products we are developing," said Adolph J. Ferro, president and chief executive officer of Epitope. "It was imperative that we rescind the acquisition transaction and recover the Epitope stock used to acquire A&W. We are pleased to have accomplished those goals so quickly, avoiding the distraction and costs of extended litigation to force rescission." Epitope, Inc. is a biotechnology company that develops and markets medical diagnostic products through its Epitope Medical Products group. Its Agritope group is focused on the development and commercialization of novel agricultural products using plant genetic engineering and other modern methods.
Source: EPITOPE Inc.
Content of this page is copyright and reprinted here for educational and historical information.