Agritope, Inc., a wholly owned subsidiary of Epitope, Inc. (NASDAQ: EPTO) today announced that it has entered into a stock purchase agreement and a research and development agreement with Vilmorin & Cie (Vilmorin), a majority owned subsidiary of Groupe Limagrain Holdings, Chappes, France. Vilmorin shares are traded on the Paris stock exchange.

Agritope has filed a registration-statement with the Securities and Exchange Commission with respect to Epitope's previously announced intention to spin off Agritope. After the registration statement is declared effective, Epitope plans to effect the spin-off through a dividend distribution to Epitope shareholders of all Agritope common stock held by Epitope. The distribution is expected to consist of one share of Agritope common stock for every five shares of Epitope common stock outstanding, for an aggregate distribution of approximately 2.7 million shares. Upon completion of the spin-off, Agritope will cease to be a wholly owned subsidiary of Epitope and will operate as an independent public company. Epitope shareholders will not have to pay for any shares of Agritope stock received in the distribution or take any action to receive shares.

Following the spin-off, Agritope has agreed to sell 1,343,704 shares of Agritope common stock in a private placement to certain foreign investors, at a price of $7 per share ($9.4 million). Under terms of its stock purchase agreement, Vilmorin will purchase 214,285 shares of Agritope preferred stock for $1.5 million in a private placement and will have an option until January 15, 1998 to purchase up to 785,715 additional shares of preferred stock for $5.5 million. The preferred stock is convertible into common stock on a share-for-share basis. Other than the right to elect a director and preemptive rights, the preferred stock has rights substantially equivalent to those applicable to common stock.

Under terms of its research and development agreement, Vilmorin will provide proprietary seed varieties for use by Agritope in projects to be funded by Vilmorin, in which both Agritope and Vilmorin technology may be applied. Vilmorin will also have a right of first refusal to fund research projects involving the genetic modification of specified vegetables and flowers.

Founded in 1743, Vilmorin specializes in the worldwide breeding, production and distribution of vegetable and flower seeds to the home garden and professional markets. It is the largest company in the world serving the home garden market and the second largest in the world serving the professional vegetable seed market. Vilmorin's U.S. subsidiary, Harris Moran Seed Company of Modesto, California and Agritope have been working together for several years to develop cantaloupe with a longer shelf life.

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