<PAGE>   1
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    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)     December 27, 1995
                                                            -----------------


                      TECHNICLONE INTERNATIONAL CORPORATION
       ------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)




            California              0-17085             95-3698422
   -------------------------------------------------------------------------
   (State or other jurisdiction   (Commission          (IRS Employer
         of incorporation)         File Number)         Identification No)




            14282 Franklin Avenue, Tustin, California      92680
           ---------------------------------------------------------
           (Address of principal executive offices)      (Zip Code)



      Registrant's telephone number, including area code (714) 838-0500
                                                         --------------



                                 Not Applicable
            ---------------------------------------------------------
          (Former name or former address, if changed since last report)

                                  Page 1 of 68
                             Exhibit Index on Page 5

                                                                               1

<PAGE>   2

ITEM 5.  OTHER EVENTS

ISSUANCE OF SERIES B CONVERTIBLE PREFERRED STOCK

         On December 27, 1995, Techniclone International Corporation (the
"Registrant") issued 7,700 shares of newly created Series B Convertible
Preferred Stock, at a price of $1,000 per share, and on December 29, 1995 issued
an additional 500 shares of Series B Convertible Preferred Stock, at a price of
$1,000 per share, for an aggregate issuance consideration of $8,200,000 to
sixteen (16) offshore investors pursuant to Regulation S promulgated under the
Securities Act of 1933. The Series B Convertible Preferred Stock is convertible,
commencing immediately after the Closing into Common Stock of Registrant. During
the first ninety days after the Closing the Preferred Stock may be converted in
multiples of $50,000 into that number of shares of Common Stock calculated by
dividing $1,000 by 110% of the Fixed Conversion Price which is the lower of (i)
$3.06875 per share of Common Stock or (ii) 85% of the fair market value of the
Common Stock on the date of conversion based on the average bid price during the
five trading days prior to the date of conversion. Beginning 91 days after the
Closing Date the number of shares issued upon conversion is determined by a
calculation contained in the Certificate of Determination of Series B
Convertible Preferred Stock (included herewith as Exhibit 3.1).

         In connection with the placement of the Series B preferred Stock the
Registrant paid to Swartz Investments, Inc. commissions of $656,000 and a
non-accountable expense allowance of $246,000. In addition, the Registrant
issued to Swartz Investments, Inc. two five year warrants to purchase an
aggregate of 240,210 shares of the Registrant's Common Stock at an exercise
price of $3.06875. The Common Stock issuable on exercise of the warrant and on
conversion of the Series B Convertible Preferred Stock (if not otherwise freely
tradeable) is subject to registration pursuant to a Registration Rights
Agreement.

         The Company intends to use the proceeds from the offering to support
its LYM-1, Oncolym(TM) manufacturing effort for the Phase III LYM-1,Oncolym(TM)
clinical trials, to fund additional development of its patented tumor necrosis
technology (TNT) and for working capital. The Company believes that the
additional capital resulting from this offering will be sufficient to support
the Company's relisting on NASDAQ. The Company plans to apply for relisting on
NASDAQ early in 1996.

                                                                               2

<PAGE>   3

ITEM 7.  EXHIBITS


<TABLE>
<CAPTION>
EXHIBIT NO.       DESCRIPTION
<S>               <C>
3.1(a)            Certificate of Determination, as filed with the California Secretary of State on
                  December 22, 1995

3.1(b)            Merger Agreement, as filed with the California Secretary of State on July 26,
                  1994

3.1(c)            Amended and Restated Articles of Incorporation, as filed with the California
                  Secretary of State on July 25, 1994

4.1               Form of Subscription Agreement entered into with each investor.

4.2               Registration Rights Agreement, dated December __, 1995.

4.3               Form of Warrant to Purchase Common Stock, issued to Swartz Investments, Inc.

99.1              Press Release dated December 29, 1995.
</TABLE>




                                                                               3

<PAGE>   4

                                    SIGNATURE

         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 thereunto duly authorized.


                                            TECHNICLONE INTERNATIONAL
                                            CORPORATION



Date:  January 22, 1996                     By:        /s/ WILLIAM V. MODING
                                                     -----------------------
                                                     William V. Moding
                                                     Chief Financial Officer

                                                                               4

<PAGE>   5

                                  EXHIBIT INDEX


<TABLE>
<CAPTION>
                                                                                           SEQUENTIAL
          EXHIBIT NO.              DESCRIPTION                                             PAGE NO.
          -----------              -----------                                             ----------
<S>                                <C>                                                           <C>
          3.1(a)                   Certificate of Determination, as filed                         6
                                   with the California Secretary of State
                                   on December 22, 1995.

          3.1(b)                   Merger Agreement, as filed with the                           19
                                   California Secretary of State on July 26,
                                   1994.

          3.1(c)                   Amended and Restated Articles                                 24
                                   of Incorporation, as filed with the
                                   California Secretary of State on
                                   July 25, 1994.

          4.1                      Form of Subscription Agreement                                34
                                   entered into with each investor

          4.2                      Registration Rights Agreement                                 51
                                   dated December __, 1995

          4.3                      Form of Warrant to Purchase                                   60
                                   Common Stock issued to
                                   Swartz Investments, Inc.

          99.1                     Press Release dated December 29, 1995                         68
</TABLE>





                                                                               5





<PAGE>   1
                          CERTIFICATE OF DETERMINATION
                                       OF
                       CLASS B CONVERTIBLE PREFERRED STOCK
                                       OF
                     TECHNICLONE INTERNATIONAL CORPORATION,
                            A CALIFORNIA CORPORATION

LON H. STONE and WILLIAM V. MODING hereby certify that:

         1.       They are the duly elected and acting President and Secretary,
respectively, of Techniclone International Corporation, a California corporation
(the "Corporation").

         2.       The Articles of Incorporation of the Corporation authorize the
issuance of One Hundred Thousand (100,000) shares of Preferred Stock of a par
value of One Dollar ($1.00) per share and vest in the Board of Directors of the
Corporation the authority provided therein to issue any or all of said shares in
one or more series and by resolution or resolutions to establish the
designation, number, full or limited voting powers, or the denial of voting
powers, preferences and relative, participating, optional, and other special
rights and the qualifications, limitations, restrictions, and other
distinguishing characteristics of each series to be issued.

         3.       The Board of Directors of the Corporation, pursuant to the
authority vested in it as aforesaid, has adopted the following resolutions
creating a Class B Convertible issue of Preferred Stock to be
 established
pursuant to amendment to the Corporation's Articles of Incorporation pursuant to
Section 401 of the California Corporations Code:

         "RESOLVED, that Ten Thousand (10,000) shares of the One Hundred
Thousand (100,000) authorized shares of Preferred Stock of the Corporation shall
be designated Class B Convertible Preferred Stock, $1.00 par value per share,
and shall possess the rights and privileges set forth below:

         SECTION 1.       DETERMINATION AND AMOUNT. The shares of such series 
shall be designated as "Class B Convertible Preferred Stock" (the "Class B
Convertible Preferred Stock") and the number of shares constituting the Class B
Convertible Preferred Stock shall be Ten Thousand (10,000). Such number of
shares may be increased or decreased by resolution of the Board of Directors;
provided, that no decrease shall reduce the number of shares of Class B
Convertible Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for issuance upon the exercise of
outstanding options, rights or warrants to acquire shares of Class B Convertible
Preferred Stock or upon the conversion of any outstanding securities issued by
the Corporation convertible into Class B Convertible Preferred Stock.

         SECTION 2.       RANK. The Class B Convertible Preferred Stock shall
rank: (i) on parity with all of the Corporation's Class A Convertible Preferred
Stock, (ii) junior to any other class or series of capital stock of the
Corporation hereafter created specifically ranking by its terms senior to the
Class B Convertible Preferred Stock (collectively, the "Senior Securities");
(iii) prior to all of the Corporation's Common Stock, no par value ("Common
Stock"); (iv) prior to any class or series of capital stock of the Corporation
hereafter created specifically ranking by its

                                 EXHIBIT 3.1(a)
                                                                               6

<PAGE>   2
terms junior to any Class B Convertible Preferred Stock of whatever subdivision
(collectively, with the Common Stock, "Junior Securities"); (v) on parity with
any class or series of capital stock of the Corporation hereafter created
specifically ranking by its terms on parity with the Class B Convertible
Preferred Stock ("Parity Securities") in each case as to distributions of assets
upon liquidation, dissolution or winding up of the Corporation, whether
voluntary or involuntary (all such distributions being referred to collectively
as "Distributions").

         SECTION 3.       DIVIDENDS.  The holders of the Class B Convertible 
Preferred Stock ("Holders") shall not be entitled to receive cash dividends on
the Class B Convertible Preferred Stock.

         SECTION 4.       LIQUIDATION PREFERENCE.

                           (a)      In the event of any liquidation, dissolution
or winding up of the Corporation, either voluntary or involuntary, the Holders
of shares of Class B Convertible Preferred Stock shall be entitled to receive,
immediately after any distributions to Senior Securities required by the
Corporation's Articles of Incorporation, as amended and restated, or any
certificate of designation of preferences, and prior and in preference to any
distribution to Junior Securities but in parity with any distribution of Parity
Securities, an amount per share equal to the sum of (i) One Thousand Dollars
($1,000) for each outstanding share of Class B Convertible Preferred Stock (the
"Original Class B Issue Price") and (ii) an amount equal to ten percent (10%) of
the Original Class B Issue Price per annum for the period that has passed since
the date of issuance of any Class B Convertible Preferred Stock (such amount
being referred to herein as the "Premium"). If upon the occurrence of such
event, and after payment in full of the preferential amounts with respect to the
Senior Securities, the assets and funds thus distributed among the Holders of
the Class B Convertible Preferred Stock and Parity Securities, respectively,
then the entire assets and funds of the Corporation legally available for
distribution shall be distributed among the Holders of the Class B Convertible
Preferred Stock and the Parity Securities, pro rata, based on the respective
liquidation amounts to which each such series of stock is entitled by the
Corporation's Articles of Incorporation, as amended and restated, and any
certificate of determination of preferences.

                           (b)      Upon the completion of the distribution
required by subsection 4(a), if assets remain in this Corporation, they shall be
distributed to holders of Junior Securities in accordance with the Corporation's
Articles of Incorporation, as amended and restated, including any duly adopted
certificate(s) of determination of preferences.

                           (c)      A consolidation or merger of the Corporation
with or into any other corporation or corporations, or a sale, conveyance or
disposition of all or substantially all of the assets of the Corporation or the
effectuation by the Corporation of a transaction or series of related
transactions in which more than fifty percent (50%) of the voting power of the
Corporation is disposed of (collectively referred to as a "Change in Control
Transaction"), shall be deemed to be a liquidation, dissolution or winding up
within the meaning of this Section 4; provided, however, that the Corporation
shall provide written notice to the Holders of the Class B Convertible Preferred
Stock of a Change in Control Transaction and the Holders of the Class B
Convertible Preferred Stock shall be entitled to convert the Class B Convertible
Preferred Stock held by such Holder pursuant to the provisions of Section 5
hereof, at any time before five (5) days prior to any Change in Control
Transaction.

                                                                               7

<PAGE>   3
         SECTION 5.       CONVERSION.  The record Holders of this Class B 
Convertible Preferred Stock shall have conversion rights as follows (the
"Conversion Rights"):

                           (a)      RIGHT TO CONVERT. Immediately after the date
of the last closing of a sale and purchase of Class B Convertible Preferred
Stock, which date shall not be later than January 15, 1996, (the "Last Closing
Date"), continuing through the first 90 days, each record Holder of Class B
Convertible Preferred Stock shall be entitled and subject to the Corporation's
right of redemption set forth in Section 6(a) and Section 6(b), at the office of
the Corporation or the transfer agent for the Class B Convertible Preferred
Stock, to convert portions of the Class B Convertible Preferred Stock held by
such Holder (but only in multiples of Fifty Thousand Dollars ($50,000)) into
that number of fully-paid and non-assessable shares of Common Stock of the
Corporation calculated in accordance with the following formula:

         110% of the Fixed Conversion Price (as defined herein).

         Beginning 91 days after the last closing date, each record Holder of
Class B Convertible Preferred Stock shall be entitled (at the times and in the
amounts set forth below), and, subject to the Corporation's right of redemption
set forth in Section 6(a) and Section 6(b), at the office of the Corporation or
the transfer agent for the Class B Convertible Preferred Stock, to convert
portions of the Class B Convertible Preferred Stock held by such Holder (but
only in multiples of Fifty Thousand Dollars ($50,000) into that number of
fully-paid and non-assessable shares of Common Stock of the Corporation
calculated in accordance with the following formula (the "Conversion Rate"):

         Number of shares issued upon conversion of one share of Class B
Convertible Preferred Stock

                        = (.10 (N/365) (1,000) + 1,000
                        ------------------------------
                                Conversion Price

where,

         N = the number of days between (i) the last closing date, as defined
         herein, and (ii) the applicable date of conversion for the shares of
         Class B Convertible Preferred Stock for which conversion is being
         elected, and

         Conversion Price = the lesser of (x) the average Closing Bid Price, as
         that term is defined below, for the five trading days ending on
         December 8, 1995 (which amount is $3.06875 and is referred to herein as
         the "Fixed Conversion Price"), or (y) X times the average Closing Bid
         Price, as that term is defined below, of the Corporation's Common Stock
         for the five (5) trading days immediately preceding the Date of
         Conversion, as defined below, where X shall equal .85 + (1-(the average
         Closing Bid Price of the Corporation's Common Stock for the five (5)
         trading days immediately preceding the Date of Conversion, as that term
         is defined below, divided by the average Closing Bid Price of the
         Corporation's Common Stock for the ten (10) trading days immediately
         preceding the Date of Conversion); provided that, in no event shall X
         be less than .85 or greater than 1.0.

                                                                               8

<PAGE>   4
         For purposes hereof, the term "Closing Bid Price" shall mean the
closing bid price on the over-the-counter market as reported by NASDAQ, or if
then traded on a national securities exchange, the NASDAQ Small Cap or the
National Market System, the closing bid price on the principal national
securities exchange, the NASDAQ Small Cap or the National Market System which it
is so traded.

                           (b)      MECHANICS OF CONVERSION. In order to convert
Class B Convertible Preferred Stock into full shares of Common Stock, the Holder
shall (i) fax a copy of the fully executed notice of conversion in the form
attached hereto ("Notice of Conversion") to the Company at such office that he
elects to convert the same, which Notice of Conversion shall specify the number
of shares of Class B Convertible Preferred Stock to be converted and shall
contain a calculation of the Conversion Rate (together with a copy of the first
page of each certificate to be converted) to the Company or its designated
transfer agent prior to Midnight, New York City time (the "Conversion Notice
Deadline") on the date of conversion specified on the Notice of Conversion and
(ii) surrender the original certificate or certificates therefor, duly endorsed,
and the original Notice of Conversion no later than the close of business (New
York City time) the next business day to a common courier, for either overnight
courier or 2-day courier, to the office of the Company and any transfer agent
for the Class B Convertible Preferred Stock; provided, however, that the Company
shall not be obligated to issue certificates evidencing the shares of Common
Stock issuable upon such conversion unless either the certificates evidencing
such Class B Convertible Preferred Stock are delivered to the Company or its
transfer agent as provided above, or the Holder notifies the Company or its
transfer agent that such certificates have been lost, stolen or destroyed.

                                     (i) LOST OR STOLEN CERTIFICATES. Upon
receipt by the Company of evidence of the loss, theft, destruction or mutilation
of a certificate or certificates ("Stock Certificates") representing shares of
Class B Convertible Preferred Stock, and (in the case of loss, theft or
destruction) of indemnity or security reasonably satisfactory to the Company,
and upon surrender and cancellation of the Stock Certificate(s), if mutilated,
the Company shall execute and deliver new Stock Certificate(s) of like tenor and
date.

                                    (ii) NO FRACTIONAL SHARES. If any
conversion of the Class B Convertible Preferred Stock would create a fractional
share of Common Stock or a right to acquire a fractional share of Common Stock,
such fractional share shall be disregarded and the number of shares of Common
Stock issuable upon conversion shall be the next higher number of shares. In the
case of a dispute as to the calculation of the Conversion Rate, the Company's
calculation shall be deemed conclusive absent manifest error.

                                   (iii) COMPANY TO REISSUE/DELIVER SHARES.
The Company shall use all reasonable efforts to issue and deliver within three
(3) business days after delivery to the Company of such certificates, or after
such agreement and indemnification, to such Holder of Class B Convertible
Preferred Stock at the address of the Holder on the Books of the Company, a
certificate or certificates for the number of shares of Common Stock to which
the Holder shall be entitled as aforesaid.

                                    (iv) DATE OF CONVERSION. The date on which
conversion occurs (the "Date of Conversion") shall be deemed to be the date set
forth in such Notice of Conversion,

                                                                               9

<PAGE>   5
provided (i) that the advance copy of the Notice of Conversion is faxed to the
Company before midnight, New York City time, on the Date of Conversion, and (ii)
that the original Stock Certificates representing the shares of Class B
Convertible Preferred Stock to be converted are surrendered no later than the
close of business (New York City time) the next business day to a common courier
for overnight or 2-day delivery, and received by the transfer agent or the
Company within five (5) business days thereafter. If the original Stock
Certificates representing the Class B Convertible Preferred Stock to be
converted are not received by the transfer agent or the Company within five (5)
business days after the Date of Conversion or if the facsimile of the Notice of
Conversion is not received by the Company or its designated transfer agent prior
to the Conversion Notice Deadline, the Notice of Conversion, at the Company's
option, may be declared null and void.

                                     (v) The person or persons entitled to
receive the shares of Common Stock issuable upon such conversion shall be
treated for all purposes as the record holder or holders of such shares of
Common Stock on such date.

         Following conversion of shares of Class B Convertible Preferred Stock,
such shares of Class B Convertible Preferred Stock will no longer be
outstanding.

                           (c)      RESERVATION OF STOCK ISSUABLE UPON
CONVERSION. The Corporation shall at all times reserve and keep available out of
its authorized but unissued shares of Common Stock, solely for the purpose of
effecting the conversion of the Class B Convertible Preferred Stock, such number
of its shares of Common Stock as shall from time to time be sufficient to effect
the conversion of all then outstanding Class B Convertible Preferred Stock; and
if at any time the number of authorized but unissued shares of Common Stock
shall not be sufficient to effect the conversion of all then outstanding shares
of Class B Convertible Preferred Stock, the Corporation will, subject to
shareholder approval, take all such corporate action as may be necessary to
increase its authorized but unissued shares of Common Stock to such number of
shares as shall be sufficient for such purpose.

                           (d)      AUTOMATIC CONVERSION. Each share of Class B
Convertible Preferred Stock outstanding on December 15, 1998 automatically shall
be converted into Common Stock on such date at the Conversion Rate then in
effect (calculated in accordance with the formula in Section 5(a) above) and
December 15, 1998 shall be deemed the Date of Conversion with respect to such
conversion.

                           (e)      ADJUSTMENT TO CONVERSION RATE.

                                    (A)      If, prior to the conversion of all
of the Class B Convertible Preferred Stock, the number of outstanding shares of
Common Stock is increased by a stock split, stock dividend, or other similar
event, the Conversion Rate shall be proportionately adjusted, or if the number
of outstanding shares of Common Stock is decreased by a combination or
reclassification of shares, or other similar event, the Conversion Rate shall be
proportionately adjusted.

                                    (B)      If, prior to the conversion of all
Class B Convertible Preferred Stock, there shall be any merger, consolidation,
exchange of shares, recapitalization, reorganization, or other similar event, as
a result of which shares of Common Stock of the

                                                                              10

<PAGE>   6
Corporation shall be changed into the same or a different number of shares of
the same or another class or classes of stock or securities of the Corporation
or another entity, then the Holders of Class B Convertible Preferred Stock shall
thereafter have the right to purchase and receive upon conversion of Class B
Convertible Preferred Stock, upon the basis and upon the terms and conditions
specified herein and in lieu of the shares of Common Stock immediately
theretofore issuable upon conversion, such shares of stock and/or securities as
may be issued or payable with respect to or in exchange for the number of shares
of Common Stock immediately theretofore purchasable and receivable upon the
conversion of Class B Convertible Preferred Stock held by such Holders had such
merger, consolidation, exchange of shares, recapitalization or reorganization
not taken place, and in any such case appropriate provisions shall be made with
respect to the rights and interests of the Holders of the Class B Convertible
Preferred Stock to the end that the provisions hereof (including, without
limitation, provisions for adjustment of the Conversion Rate and of the number
of shares issuable upon conversion of the Class B Convertible Preferred Stock)
shall thereafter be applicable, as nearly as may be practicable in relation to
any shares of stock or securities thereafter deliverable upon the exercise
hereof. The Corporation shall not effect any transaction described in this
subsection 5(e) unless the resulting successor or acquiring entity (if not the
Corporation) assumes by written instrument the obligation to deliver to the
Holders of the Class B Convertible Preferred Stock such shares of stock and/or
securities as, in accordance with the foregoing provisions, the Holders of the
Class B Convertible Preferred Stock may be entitled to receive upon conversion
of the Class B Convertible Preferred Stock.

                                    (C)      If any adjustment under this
Section 5(e) would create a fractional share of Common Stock or a right to
acquire a fractional share of Common Stock, such fractional share shall be
disregarded and the number of shares of Common Stock issuable upon conversion
shall be the next higher number of shares.

         SECTION 6.        CASH REDEMPTION BY CORPORATION.

                           (a)      CORPORATION'S RIGHT TO REDEEM UPON RECEIPT
OF NOTICE OF CONVERSION. The Corporation shall have the right, in its sole
discretion, upon receipt of a Notice of Conversion pursuant to Section 5, to
redeem in whole or in part any Class B Convertible Preferred Stock submitted for
conversion, immediately prior to conversion. If the Corporation elects to redeem
some, but not all, of the Class B Convertible Preferred Stock submitted for
conversion, the Corporation shall redeem from among the Class B Convertible
Preferred Stock submitted by the various Holders thereof for conversion on the
applicable date, a pro-rata amount from each Holder so submitting Class B
Convertible Preferred Stock for conversion. The Corporation shall effect each
such redemption by giving notice ("Notice of Redemption Upon Receipt of Notice
of Conversion") of its election to redeem, by facsimile within one (1) business
day following receipt of a Notice of Conversion from a Holder, with a copy by
2-day courier, (A) to the Holders of Class B Convertible Preferred Stock
selected for redemption, at the address and facsimile number of such Holder
appearing in the Corporation's register for the Class B Convertible Preferred
Stock and (B) the Corporation's transfer agent. Such Notice of Redemption Upon
Receipt of Notice of Conversion shall indicate the number of shares of Holder's
Class B Convertible Preferred Stock that have been selected for redemption, the
Date of Redemption Upon Receipt of Notice of Conversion (as defined below) and
the applicable Redemption Price Upon Receipt of Notice of Conversion, as defined
below. If the Notice of Redemption Upon Receipt of Notice of Conversion is not
received within the times specified

                                                                              11

<PAGE>   7
above or does not meet the conditions specified above, the Notice of Redemption
Upon Receipt of Notice of Conversion shall become null and void (unless
otherwise agreed in writing by the Holder). The Corporation shall not be
entitled to send any Notice of Redemption upon Receipt of Notice of Conversion
and begin the redemption procedure unless it has (x) the full amount of the
Redemption Price Upon Receipt of Notice of Conversion, in cash, available in a
demand or other immediately available account in a bank or similar financial
institution or (y) immediately available credit facilities, in the full amount
of the Redemption Price Upon Receipt of Notice of Conversion, with a bank or
similar financial institution on the date the Notice of Redemption Upon Receipt
of Notice of Conversion is sent to the applicable Holder.

         The Redemption Price Upon Receipt of Notice of Conversion per share of
Class B Convertible Preferred Stock shall equal the Closing Bid Price on the
Date of Conversion, multiplied by the number of shares of Common Stock that
would otherwise have been issuable had the shares of Class B Convertible
Preferred Stock redeemed been converted on the Date of Conversion as to such
shares.

         For the purposes of the above formula, "N", "Closing Bid Price" and
"Conversion Price" shall have the meanings set forth in Section 5(a) and "Date
of Redemption" shall be deemed to be the Conversion Date (as that term is
defined in Section 5(b) above).

         The Redemption Price Upon Receipt of Notice of Conversion shall be paid
to the Holder of Class B Convertible Preferred Stock redeemed within ten (10)
business days of the delivery of the Notice of Redemption Upon Receipt of Notice
of Conversion to such Holder; provided, however, that the Corporation shall not
be obligated to deliver any portion of the Redemption Price Upon Receipt of
Notice of Conversion unless either the certificates evidencing the Class B
Convertible Preferred Stock redeemed are delivered to the Corporation or the
transfer agent as provided in Section 5(b), or the Holder notifies the transfer
agent that such certificates have been lost, stolen or destroyed and executes an
agreement satisfactory to the Corporation to indemnify the Corporation from any
loss incurred by it in connection with such certificates. Notwithstanding the
foregoing, in the event that the certificates evidencing the Class B Convertible
Preferred Stock delivered to the transfer agent as provided in Section 5(b), the
redemption of the Class B Convertible Preferred Stock pursuant to this Section
6(a) shall still be deemed effective as of the Date of Redemption Upon Receipt
of Notice of Conversion.

                           (b)      CORPORATION'S RIGHT TO REDEEM AT ITS
ELECTION. Commencing 91 days after the last closing date, the Corporation shall
have the right, in its sole discretion, to redeem, from time to time, any or all
of the Class B Convertible Preferred Stock; provided that, the Corporation shall
only be entitled to redeem shares of Class B Convertible Preferred Stock with an
aggregate Stated Value (as defined below) of at least One Million Five Hundred
Thousand Dollars ($1,500,000) on the first such redemption. If the Corporation
elects to redeem some, but not all, of the Class B Convertible Preferred Stock,
the Corporation shall redeem a pro-rata amount from each Holder of Class B
Convertible Preferred Stock. The Corporation shall effect each such redemption
by giving at least thirty (30) days prior written notice by overnight or 2-day
courier ("Notice of Redemption At Corporation's Election") to (A) the Holders of
Class B Convertible Preferred Stock selected for redemption, at the address and
facsimile number of such Holder appearing in the Corporation's register for the
Class B Convertible Preferred Stock and (B) the transfer agent, which Notice of
Redemption At Corporation's Election shall be deemed to have been delivered
three (3) business days after the

                                                                              12

<PAGE>   8
Corporation's mailing of such Notice of Redemption At Corporation's Election.
Such Notice of Redemption At Corporation's Election shall indicate the number of
shares of Holder's Class B Convertible Preferred Stock that have been selected
for redemption, the date which such redemption is to become effective (the "Date
of Redemption At Corporation's Election" and the applicable Redemption Price At
Corporation's Election, as defined below. The Corporation shall not be entitled
to send any Notice of Redemption At Corporation's Election and begin the
redemption ,procedure unless it has (x) the full amount of the Redemption Price
At Corporation's Election, in cash, available in a demand or other immediately
available account in a bank or similar financial institution or (y) immediately
available credit facilities, in the full amount of the Redemption At
Corporation's Election, with a bank or similar financial institution on the date
the Notice of Redemption At Corporation's Election is delivered to the
applicable Holder. Notwithstanding the above, the Holder may convert any or all
of its Class B Convertible Preferred Stock that is eligible for conversion,
which would otherwise be subject to redemption under this Section 6(b), by
submitting a Notice of Conversion prior to the effective date of such
redemption. Corporation is not entitled to require redemption under this Section
6(b) if the Corporation makes any planned press release either (a) on the
effective date of redemption or (b) prior to the close of trading on the
following business day. Additionally, the Corporation shall not be permitted to
elect redemption under this Section 6(b) if the Corporation has in its
possession material information concerning the Corporation which is required to
be publicly disclosed pursuant to the rules and regulations of the Securities
Exchange Act of 1934 or relevant self-regulatory organization and has not yet
been disclosed. In the event the Corporation is deemed to be in possession of
such undisclosed information subsequent to it providing Notice of Redemption,
the date upon which the Corporation can require the holders of the Class B
Convertible Preferred Stock to redeem shall be 15 days following the date of any
press release or other public disclosure.

         For purposes of this Section 6(b), "Stated Value" shall mean the
Original Class B Issue Price of the shares of Class B Convertible Preferred
Stock redeemed pursuant to this Section 6(b), plus the accrued but unpaid
Premium (as defined in Section 4(a)) on such shares of Class B Convertible
Preferred Stock, as of the date of Redemption At Corporation's Election.

         The Redemption Price At Corporation's Election shall be calculated as a
percentage of Stated Value of the shares of Class B Convertible Preferred Stock
redeemed pursuant to this Section 6(b), which percentage shall vary depending on
the date of delivery of the Notice of Redemption at Corporation's Election, and
shall be determined as follows:


<TABLE>
<CAPTION>
Date of Delivery of Notice of Redemption at Corporation's Election              % of Stated Value
- ------------------------------------------------------------------              -----------------
<S>                                                                                   <C>
91 days to 6 months following last closing date                                       130%
6 months and 1 day to 12 months following last closing date                           125%
12 months and 1 day to 18 months following last closing date                          120%
18 months and 1 day to 24 months following last closing date                          115%
24 months and 1 day to 30 months following last closing date                          110%
30 months and 1 day to 36 months following last closing date                          105%
</TABLE>


         The Redemption Price At Corporation's Election shall be paid to the
Holder of Class B Convertible Preferred Stock redeemed within ten (10) business
days of the Date of Redemption At Corporation's Election to such Holder;
provided, however, that the Corporation shall not be

                                                                              13

<PAGE>   9
obligated to deliver any portion of the Redemption Price At Corporation's
Election unless either the certificates evidencing the Class B Convertible
Preferred Stock redeemed are delivered to the transfer agent prior to the 10th
business day following the Date of Redemption At Corporation's Election, or the
Holder notifies the transfer agent that such certificates have been lost, stolen
or destroyed and executes an agreement satisfactory to the Corporation to
indemnify the Corporation from any loss incurred by it in connection with such
certificates. Notwithstanding the foregoing, in the event that the certificates
evidencing the Class B Convertible Preferred Stock redeemed are not delivered to
the transfer agent, prior to the 10th business day following the Date of
Redemption at Corporation's Election, the redemption of the Class B Convertible
Preferred Stock pursuant to this Section 6(b) shall still be deemed effective as
of the date of Redemption at Corporation's Election, and the Redemption Price At
Corporation's Election shall be paid to the Holder of Class B Preferred Stock
redeemed within 5 business days of the date the certificates evidencing the
Class B Preferred Stock redeemed are actually delivered to the transfer agent.

         SECTION 7.        ADVANCE NOTICE OF REDEMPTION.

                           (a)      HOLDER'S RIGHT TO ELECT TO RECEIVE NOTICE OF
CASH REDEMPTION BY CORPORATION. Holder shall have the right to require
Corporation to provide advance notice stating whether Corporation will elect to
redeem Holder's shares in cash, pursuant to Corporation's redemption rights
discussed in Section 6.

                           (b)      MECHANICS OF HOLDER'S ELECTION NOTICE.
Holder shall send notice to Corporation by facsimile ("Election Notice") stating
Holder's intention to require Corporation to disclose that if Holder were to
exercise his, her or its right of conversion (pursuant to section 5) whether
Corporation would elect to redeem Holder's convertible Security for cash in lieu
of issuing Common Stock. Corporation is required to disclose to Holder what
action Corporation would take over the subsequent five day period, including the
date Corporation receives such Election Notice.

                           (c)      CORPORATION'S RESPONSE. Corporation must
respond within one business day of receipt of Holder's Election Notice (1) via
facsimile and (2) via overnight courier. If Corporation does not respond to
Holder within one business day via facsimile and overnight courier, Corporation
shall be required to issue to Holder Common Stock upon Holder's conversion
within the subsequent five day period.

         SECTION 8.        VOTING RIGHTS. Except as otherwise provided by the
California General Corporation Law ("California Law"), the Holders of the Class
B Convertible Preferred Stock shall have no voting power whatsoever, and no
Holder of Class B Convertible Preferred Stock shall vote or otherwise
participate in any proceeding in which actions shall be taken by the Corporation
or the shareholders thereof or be entitled to notification as to any meeting of
the shareholders.

         To the extent that under California Law the vote of the Holders of the
Class B Convertible Preferred Stock, voting separately as a class, is required
to authorize a given action of the Corporation, the affirmative vote or consent
of the Holders of at least a majority of the outstanding shares of the Class B
Convertible Preferred Stock at a duly held meeting at which a quorum is present
or by written consent of a majority of the shares of Class B Convertible
Preferred Stock (except as otherwise maybe required under California Law) shall
constitute the

                                                                              14

<PAGE>   10
approval of such action by the class. To the extent that under California Law
the Holders of the Class B Convertible Preferred Stock are entitled to vote on a
matter with Holders of Common Stock, voting together as one class, each share of
Class B Convertible Preferred Stock shall be entitled to a number of votes equal
to the number of shares of Common Stock into which it is then convertible using
the record date for the taking of such vote of shareholders as the date as of
which the Conversion Price is calculated. Holders of the Class B Convertible
Preferred Stock shall be entitled to notice of all shareholder meetings or
written consents with respect to which they would be entitled to vote, which
notice would be provided pursuant to the Corporation's by-laws and applicable
statutes.

         SECTION 9.        PROTECTIVE PROVISIONS. So long as shares of Class B
Convertible Preferred Stock are outstanding, the Corporation shall not without
first obtaining the approval (by vote or written consent, as provided by
California Law) of the Holders of at least a majority of the then outstanding
shares of Class B Convertible Preferred Stock;

                           (a)      alter or change the rights, preferences or
privileges of the shares of Class B Convertible Preferred Stock or any Senior
Securities so as to affect adversely the Class B Convertible Preferred Stock;

                           (b)      create any new class or classes or series of
stock having a preference over the Class B Convertible Preferred Stock with
respect to Distributions (as defined in Section 2 above); or

                           (c)      do any act or thing not authorized or
contemplated by this Determination which would result in taxation of the Holders
of shares of the Class B Convertible Preferred Stock under Section 305 of the
Internal Revenue Code of 1986, as amended (or any comparable provision of the
Internal Revenue Code as hereafter from time to time amended).

         SECTION 10.       STATUS OF REDEEMED OR CONVERTED STOCK. In the event
any shares of Class B Convertible Preferred Stock shall be redeemed or converted
pursuant to Section 5 or Section 6 hereof, the shares so converted or redeemed
shall be canceled, shall return to the status of authorized but unissued
Preferred Stock of no designated series and shall not be issuable by the
Corporation as Class B Convertible Preferred Stock.

         SECTION 11.       PREFERENCE RIGHTS. Nothing contained herein shall be
construed to prevent the Board of Directors of the Corporation from issuing one
or more series of Preferred Stock with dividend and/or liquidation preferences
equal to or junior to the dividend and liquidation preferences of the Class B
Convertible Preferred Stock.

         FURTHER RESOLVED, that the statements contained in the foregoing
resolutions creating and designating the said Class B Convertible Preferred
Stock and fixing the number, powers, preferences and relative, optional,
participating, and other special rights and the qualifications, limitations,
restrictions, and other distinguishing characteristics thereof shall, upon the
effective date of said Class, be deemed to be included in and be a part of the
Articles of Incorporation, as amended and restated, of the Corporation pursuant
to the provisions of the California General Corporation Law."

                                                                              15

<PAGE>   11
         4.      The authorized number of shares of Class B Convertible
Preferred Stock is 10,000, none of which has been issued."

                                                                              16

<PAGE>   12
         We further declare under penalty of perjury under the laws of the State
of California that the matters set forth in this Certificate are true and
correct of our knowledge.

         IN WITNESS WHEREOF, the undersigned have executed this Certificate this
1st day of December, 1995.



                                           /s/ Lon H. Stone
                                           ------------------------------------
                                           Lon H. Stone, President




/s/ William V. Moding
- --------------------------------------
William V. Moding, Secretary

                                                                              17

<PAGE>   13
                              NOTICE OF CONVERSION

                    (To be Executed by the Registered Holder
                    in order to Convert the Preferred Stock)

The undersigned hereby irrevocably elects to convert _______________ shares of
Class B Convertible Preferred Stock, represented by stock certificate No(s).
______________ (the "Preferred Stock Certificates") into shares of common stock
("Common Stock") of Techniclone International Corporation, (the "Corporation")
according to the conditions of the Certificate of Determination of Class B
Convertible Preferred Stock, as of the date written below. If shares are to be
issued in the name of a person other than the undersigned, the undersigned will
pay all transfer taxes payable with respect thereto and is delivering herewith
such certificates. No fee will be charged to the Holder for any conversion,
except for transfer taxes, if any.

The undersigned represents and warrants that all offers and sales by the
undersigned of the shares of Common Stock issuable to the undersigned upon
conversion of the Class B Convertible Preferred Stock shall be made in
compliance with Regulation S, pursuant to registration of the Common Stock under
the Securities Act of 1933, as amended (the "Act") or pursuant to an exemption
from registration under the Act.


Conversion Calculations:                 ______________________________________
                                         Date of Conversion


                                         ______________________________________
                                         Applicable Conversion Price


                                         ______________________________________
                                         Signature


                                         ______________________________________
                                         Name

                                         Address:

                                         ______________________________________

                                         ______________________________________

* No shares of Common Stock will be issued until the original Class B
Convertible Preferred Stock Certificate(s) to be converted and the Notice of
Conversion are received by the Transfer Agent.

                                                                              18



<PAGE>   1
                                MERGER AGREEMENT

         THIS MERGER AGREEMENT ("Merger Agreement") is made and entered into as
of the 10th day of June 1994 by and between TECHNICLONE INTERNATIONAL
CORPORATION, a California corporation ("Company"), and CANCER BIOLOGICS
INCORPORATED, a California corporation ("CBI").

                                R E C I T A L S :

         A.       The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of California and has full
corporate powers and authority to carry on its business as presently conducted
and to enter into this Agreement.

         B.       CBI is a corporation duly organized, validly existing and in
good standing under the laws of California and has full corporate power and
authority to carry on its business as presently conducted and to enter into this
Agreement.

         C.       The respective boards of directors of Company and CBI deem it
advisable and in the best interests of Company and CBI and their respective
shareholders that CBI be merged with and into Company as authorized by the
provisions of this Merger Agreement and the laws of the State of California, and
each such board of directors has duly approved this Merger Agreement. The
Company, as the corporation surviving such merger, is hereinafter sometimes

referred to as the "Surviving Corporation."

         D.       The shareholders of CBI have duly approved, in accordance with
the applicable laws of the State of California, the principal terms and
provisions of (i) the Agreement and Plan of Merger dated January 18, 1994
between CBI and Company providing for certain representations, warranties,
covenants and conditions in connection with the merger (the "Agreement") and
(ii) this Merger Agreement.

         NOW, THEREFORE, in consideration of the promises and the mutual
covenants and agreements herein set forth and for the purpose of prescribing the
terms and conditions of such merger, the parties hereto agree as follows:

         1.       MERGER

                  CBI shall be merged into the Company, and the separate
existence of CBI shall cease upon consummation of the merger at the effective
time thereof (as defined in Section 2 hereof).

         2.       EFFECTIVE TIME

                  The merger shall become effective (the "Effective Time") at
the time of the filing, in the office of the Secretary of State of the State of
California, of an executed copy of this Agreement and all requisite accompanying
certificates.

                                EXHIBIT 3.1(b)                                19

<PAGE>   2
         3.       NAME OF SURVIVING CORPORATION

                  At the Effective Time, the name of the Surviving Corporation
shall be Techniclone International Corporation.

         4.       ARTICLES OF INCORPORATION

                  The Articles of Incorporation of Company, as in effect
immediately prior to the Effective Time of the merger, shall continue in effect
as the Articles of Incorporation of the Company following the merger.

         5.       BYLAWS

                  The Bylaws of the Company, as in effect immediately prior to
the Effective Time of the merger, shall continue in effect as the Bylaws of
Company after the merger.

         6.       OFFICERS AND DIRECTORS

                  (a)      The officers of the Company and CBI immediately prior
to the effectiveness of the merger shall, at the Effective Time, continue as
officers of Company, with appropriate changes in titles to eliminate
duplication.

                  (b)      At the Effective Time, the directors of Company,
prior to the merger, shall continue in their positions as directors of Company.

                  (c)      The directors of the Company shall serve until
removed as provided by law or until the election of their respective successors.
Any vacancy existing on the board of directors of the Company, after the
Effective Time of the merger, shall be filled in the manner provided by the
Bylaws of the surviving corporation.

         7.       CONVERSION OF SHARES

                  (a)      Each share of CBI Common Stock outstanding
immediately prior to the Effective Time of the merger, and all rights with
respect thereto, shall, by virtue of the merger and without any action on the
part of the holder thereof or any other person, be cancelled and cease to exist
as a share of CBI, and shall be converted into the right to receive one share of
fully paid and nonassessable Common Stock of the Company, without par value,
except for shares of CBI Company Stock held by Company, which shall be cancelled
at the Effective Time.

                  (b)      Each holder of a certificate representing shares of
CBI Common Stock, other than Company, shall, upon presentation of such
certificate for surrender to Company be entitled to receive in exchange
therefor, a certificate or certificates representing the number of shares of
Company Common Stock to which such holder shall be entitled as aforesaid. Until
so surrendered, each outstanding certificate which prior to the merger
represented shares of CBI Common Stock shall be deemed, for all corporate
purposes, to evidence ownership of the number of shares of Company Common Stock
into which such shares of CBI Common Stock have been converted pursuant to
paragraph 7(a) above, except that the holder thereof shall not be entitled to
exercise any rights of a shareholder of Company until such certificate shall be
surrendered. No dividends declared with

                                                                              20

<PAGE>   3
respect to such Company shares shall be paid to the holder of any unsurrendered
certificate of CBI Common Stock until such holder shall surrender such
certificate as aforesaid, at which time the holder shall be paid the amount of
dividends, if any, without interest, which theretofore became payable with
respect to the shares of Company Common Stock exchangeable for the shares of CBI
Common Stock evidenced by such certificate. Shares of Company Common Stock shall
be issued to the holders of lost or destroyed shares of CBI upon presentation to
Company of such evidence of ownership and agreement of indemnity as Company may
reasonably require.

                  (c)      The stock transfer books of CBI pertaining to CBI
Common Stock outstanding at the Effective Time of the merger shall be closed at
the Effective Time of the merger and thereafter no transfer of any such shares
of CBI Common Stock shall be recorded thereon. In the event a transfer of
ownership of shares of CBI Common Stock is not recorded on the stock transfer
books of CBI, a certificate or certificates representing the number of whole
shares of Company Common Stock into which such shares of CBI Common Stock shall
have been converted in connection with the merger may be issued to the
transferee of such shares of CBI Common Stock if on surrender thereof such
certificate is accompanied by all documents deemed necessary by Company to
evidence and effect such transfer of ownership of shares of CBI Common Stock and
by the payment of any applicable stock transfer tax with respect to such
transfer.

                  (d)      The shares of Company Common Stock outstanding
immediately prior to the Effective Time of the merger shall remain outstanding
and shall not be affected by the consummation of the merger.

         8.       EMPLOYEE STOCK OPTIONS

                  At the Effective Time, the Company will assume CBI's option
plan entitled Incentive Stock Option, Nonqualified Stock Option and Restricted
Stock Purchase Plan - 1987 (the "Plan), and all of the obligations thereunder,
including each of the outstanding stock options previously granted under the
Plan (each such option existing immediately prior to the Effective Time being an
"Existing Option" and each such option so assumed by the Company being called an
"Assumed Option"), by which such assumption the optionee shall have the right to
purchase one share of Company Common Stock for each share of Common Stock of CBI
the optionee was entitled to purchase under such Existing Option. Each Assumed
Option, subject to such modifications as may be required, shall constitute a
continuation of the Existing Option substituting the Company for CBI. The price
per share of Company Common Stock at which the Assumed Option (or any
installment) may be exercised shall be the same price as applicable to the
purchase of the CBI Common Stock pursuant to the Existing Option and all other
terms and conditions applicable to the Assumed Options shall, except as herein
provided, be unchanged. Each option granted under the Plan from and after the
Effective Time shall evidence a right to purchase shares of Common Stock of the
Company, rather than of CBI, and the Plan shall be so modified, otherwise that
Plan shall remain unchanged.

         9.       TRANSFER OF ASSETS

                  Under the provisions of this Agreement, Company shall continue
in existence and shall succeed, without the necessity of any other transfer, to
all the rights, privileges, powers and franchises of CBI and the properties of
CBI, real, personal and mixed, and shall be subject to all of the debts and
liabilities of CBI in the same manner as if it had itself incurred them.

                                                                              21

<PAGE>   4
         10.      TERMINATION

                  This Agreement may be abandoned at any time before or after
adoption or approval thereof by the outstanding shares of CBI, but not after the
Effective Time of the merger and only by the consent of the respective boards of
directors of CBI and Company. This Merger Agreement shall automatically be
terminated if prior to the Effective Time of the merger, the Agreement is
terminated in accordance with Section 4.2 thereof.

         11.      OTHER PROVISIONS WITH RESPECT TO THE MERGER

                  (a)      The Company and CBI, by mutual consent of their
respective boards of directors, to the extent permitted by law, may amend,
modify, supplement and interpret this Merger Agreement in such manner as may be
mutually agreed upon by them in writing at any time and, in the case of an
interpretation, the actions of such boards of directors shall be binding;
provided, however, that no amendment, modification or supplement shall affect
the rights of the shareholders of either CBI or Company in any manner which is
materially adverse to such shareholders in the judgment of such respective
boards of directors.

                  (b)      If at any time after the Effective Time of the merger
Company shall consider or be advised that any further assignment or assurance in
law or other action is necessary or desirable to vest, perfect or confirm, of
record or otherwise, in Company the title to any property or rights of either of
CBI acquired or to be acquired as a result of the merger, the proper officers
and directors of CBI immediately prior to the Effective Time of the merger shall
be, and they hereby are, severally and fully authorized to execute and deliver
such deeds, assignments and assurances in law and to take such other actions as
may be necessary or proper in the name of CBI to vest, perfect or confirm title
to such property or rights in Company, the surviving corporation, and otherwise
to carry out the purposes of this Merger Agreement.

                  (c)      The captions of this Merger Agreement are for
convenience of reference only and shall not restrict or modify the meaning of
any terms or provisions hereof.

                  (d)      Whenever the context of this Merger Agreement
requires, the gender of all words used herein shall include the masculine,
feminine and neuter, and the number of all words shall include the singular and
plural.

                  (e)      Unless otherwise provided in the Agreement or this
Merger Agreement, the terms and provisions of this Merger Agreement shall govern
in the event of any conflict between the terms and provisions of the Agreement
and this Merger Agreement.

                  (f)      This Merger Agreement may be executed in
counterparts, each of which when so executed shall be deemed an original and
such counterparts shall together constitute one and the same instrument.

                                                                              22

<PAGE>   5
         IN WITNESS WHEREOF, CBI and Company, pursuant to approval and authority
duly given by resolutions adopted by their respective boards of directors, have
each caused this Merger Agreement to be executed by its Chairman of the Board or
President.
 
                                        TECHNICLONE INTERNATIONAL
                                        CORPORATION, a California corporation
                                 
                                 
                                 
                                        By: /s/ Lon H. Stone
                                            -----------------------------------
                                            Lon H. Stone, Chairman of the Board
                             
/s/ R.C Shepard                                
- ---------------------------------
R.C. Shepard, Assistant Secretary

                                        CANCER BIOLOGICS INCORPORATED, a
                                        California corporation



                                        By: /s/ Lon H. Stone
                                            -----------------------------------
                                            Lon H. Stone, President

/s/ R.C Shepard                                
- ---------------------------------
R.C. Shepard, Assistant Secretary



                                                                              23



<PAGE>   1

                              AMENDED AND RESTATED
                            ARTICLES OF INCORPORATION

                                       OF
                     TECHNICLONE INTERNATIONAL CORPORATION,

                            A CALIFORNIA CORPORATION

         The undersigned, LON H. STONE and WILLIAM V. MODING, hereby certify as
follows:

         1. They are the duly elected and acting President and Secretary,
respectively, of TECHNICLONE INTERNATIONAL CORPORATION, a California corporation
(the "Corporation").

         2. The Articles of Incorporation of this Corporation are hereby amended
and restated to read in full as follows:

                                   "ARTICLE I

         The name of this Corporation is TECHNICLONE INTERNATIONAL CORPORATION.

                                   ARTICLE II

         The purpose of this Corporation is to engage in any lawful act or
activity for which a Corporation may be organized under the General Corporation
Law of California other than the banking business, the trust company business or
the practice of a profession permitted to be incorporated by the California
Corporations Code.

                                   ARTICLE III

         This Corporation is authorized to issue two classes of stock to be
designated "Common Stock" and "Preferred Stock", respectively. The total number
of shares that this Corporation is authorized to issue is Thirty Million One
Hundred Thousand (30,100,000) shares. Thirty Million (30,000,000) shares shall
be Common
 Stock, no par value, and One Hundred Thousand (100,000) shares shall
be Preferred Stock, $1.00 par value per share. The Preferred Stock shall be
divided into series. The first series shall consist of 10,000 shares and shall
be designated "Class A Convertible Preferred Stock" (the "Class A Stock").

         The remaining Preferred Stock may be issued from time to time in one or
more series. Subject to the rights as hereinafter set forth of the holders of
the Class A Stock the Board of Directors of the Corporation is hereby authorized
to determine the number of series into which the shares of Preferred Stock may
be divided, and (except to the extent such matters are fixed by the Articles of
Incorporation) to determine and alter the rights, preferences, privileges and
restrictions


                                EXHIBIT 3.1(C)                                24


<PAGE>   2
granted to or imposed upon any wholly unissued series of Preferred Stock, to fix
the designation and number of shares constituting any series prior to the issue
of shares of that series and to increase or decrease, within the limits stated
in any resolution or resolutions of the Board of Directors originally fixing the
number of shares constituting any series (but not below the number of shares of
such series then outstanding), the number of shares of any such series
subsequent to the issue of shares of that series.

         The powers, preferences and rights of, and the qualifications,
limitations or restrictions on, the Class A Stock are as follows:

         1. DIVIDENDS. The holders of Class A Stock shall be entitled to receive
out of funds legally available therefor, a dividend in an amount equal to any
dividends payable to holders of the Common Stock of the Corporation, based on
the largest number of full shares of Common Stock into which such holder's
shares of Class A Stock could be converted pursuant to the Articles of
Incorporation immediately prior to the record date for the payment of each such
dividend. No dividend may be declared and paid upon shares of Common Stock in
any fiscal year of the Corporation unless a dividend of an equal amount is
simultaneously declared and paid upon all shares of Class A Stock for such
fiscal year of the Corporation. Dividends shall not be cumulative and no
undeclared or unpaid dividend shall bear interest.

         2. LIQUIDATION, DISSOLUTION OR WINDING UP.

            (a) PREFERENCE - PREFERRED STOCK. In the event of any liquidation,
dissolution or winding up of the Corporation, whether voluntary or involuntary,
the holders of each share of Class A Stock shall be entitled to be paid out of
the assets of the Corporation available for distribution to holders of the
Corporation's capital stock of all classes, whether such assets are capital,
surplus, or earnings, before any sums shall be paid or any assets distributed
among the holders of shares of Common Stock, an amount equal to $60.00 per share
of Class A Stock plus any and all declared but unpaid dividends on such shares
(the "Class A Preference Price"). If the assets of the Corporation shall be
insufficient to permit the payment in full to all holders of the Class A Stock
of their full aforesaid preferential amounts, then the entire assets of the
Corporation available for such distribution shall be distributed ratably among
all of the holders of the Class A Stock in proportion to each such holder's full
preferential amount. After the Class A Preference Price shall have been paid in
full to the holders of the Class A Stock, or funds necessary for such payment
shall have been set aside by the Corporation in trust for the account of holders
of the Class A Stock so as to be available for such payment, the remaining
assets of the Corporation available for distribution to shareholders shall be
distributed among the holders of Common Stock and Class A Stock pro-rata based
on the number of shares of Common Stock they hold or have the right to obtain
upon conversion of their Preferred Stock.

            (b) CONSOLIDATION TREATED AS LIQUIDATION. A consolidation or merger,
other than a consolidation or merger in which the holders of voting securities
of the Corporation immediately before the consolidation or merger own
(immediately after the consolidation or merger) voting securities of the
surviving or acquiring corporation, or of a parent of such surviving or
acquiring corporation, possessing more than 60% of the voting power of such
surviving or acquiring corporation or parent of the corporation (a "Qualifying
Merger"), or a sale of all or substantially all of the assets of the Corporation
shall be regarded as a liquidation, dissolution or winding up of the affairs of
the Corporation within the meaning of this Section 2.

                                                                              25

<PAGE>   3
            (c) ELECTION. Each holder of Class A Stock shall have the right to
elect the benefits of the provisions of Section 4(h) hereof in lieu of receiving
payment in liquidation, dissolution or winding up of the Corporation pursuant to
Section 2(b). The election procedures shall be as provided in Section 4(h)
hereof.

            (d) PROPERTY. Whenever the distribution provided for herein shall be
paid in property other than cash, the value of such distribution shall be the
fair market value of such property as determined in good faith by the Board of
Directors of the Corporation.

         3. VOTING POWER. Except as otherwise required by law or as otherwise
set forth herein, the shares of Class A Stock shall be voted equally with the
shares of Common Stock upon the following basis: Each holder of Class A Stock
shall be entitled, notwithstanding any provision hereof, to notice of any
shareholders' meeting in accordance with the bylaws of this Corporation, and
shall be entitled to vote, together with holders of Common Stock as a single
class, with respect to any questions upon which holders of Common Stock have the
right to vote. Each holder of Class A Stock shall be entitled to that number of
votes equal to the largest number of whole shares of Common Stock into which
such holder's shares of Class A Stock could be converted, pursuant to the
provisions of Section 4 hereof, at the record date for the determination of
shareholders entitled to vote on such matter or, if no such record date is
established, at the date such vote is taken or any written consent of
shareholders is solicited.

         4. CONVERSION RIGHTS. The holders of the Class A Stock shall have the
following conversion rights:

            (a) GENERAL. Subject to and in compliance with the provisions of
this Section 4, any shares of the Class A Stock may, at the option of the
holder, be converted at any time or from time to time into fully-paid and
nonassessable shares (calculated as to each conversion to the largest whole
share) of Common Stock. The number of shares of Common Stock to which a holder
of Class A Stock shall be entitled upon conversion shall be the product obtained
by multiplying the applicable conversion rate (determined as provided in Section
4(b)) by the number of shares of Class A Stock being converted.

            (b) CONVERSION RATE. The conversion rate per share of Class A Stock
in effect at any time (the "Conversion Rate") shall be the quotient obtained by
dividing $60.00 by the Conversion Price, calculated as provided in Section 4(c).

            (c) CONVERSION PRICE. The initial Conversion Price shall be $1.50
(the "Conversion Price").

            (d) MECHANICS OF CONVERSION. Each holder of Class A Stock, who
desires to convert the same into shares of Common Stock, subject to the
provisions of this paragraph (d), shall surrender the certificate or
certificates therefor, duly endorsed, at the office of the Corporation or of any
transfer agent for the Common Stock, and shall give written notice to the
Corporation at its principal office that such holder elects to convert the same
and shall state therein the number of shares of Class A Stock being converted.
Thereupon the Corporation shall promptly issue and deliver at such office to
such holder a certificate or certificates for the number of shares of Common
Stock to which such holder is entitled and shall promptly pay in cash all
declared but unpaid dividends on the shares being converted or, if the
Corporation so elects or is legally or

                                                                              26

<PAGE>   4
financially unable to pay such dividends in cash, Common Stock (valued at the
Common Stock's fair market value at the time of surrender as determined in good
faith by the Board). Such conversion shall be deemed to have been made
immediately prior to the close of business on the date of such surrender of the
certificate representing the shares to be converted (the "Conversion Date"), and
the person entitled to receive the shares of Common Stock issuable upon such
conversion shall be treated for all purposes as the record holder of such shares
of Common Stock on such date. The Class A Stock may be converted in any multiple
of One Hundred (100) shares or more.

            (e) CASH IN LIEU OF FRACTIONAL SHARES. No fractional shares of
Common Stock or scrip representing fractional shares shall be issued upon the
conversion of shares of Class A Stock. Instead of any fractional shares of
Common Stock which would otherwise be issuable upon conversion of the Class A
Stock, the Corporation shall pay to the holder of the shares of Class A Stock
which were converted a cash adjustment in respect of such fractional shares in
an amount equal to the same fraction of the market price per share of the Common
Stock (as determined in a reasonable manner prescribed by the Board of
Directors) at the close of business on the Conversion Date. The determination as
to whether or not any fractional shares which are issuable shall be based upon
the total number of shares of Class A Stock being converted at any one time by
any holder thereof, not upon each share of Class A Stock being converted.

            (f) DIVIDENDS. In the event the Corporation shall make or issue, or
fix a record date for the determination of holders of Common Stock entitled to
receive, a dividend or other distribution payable in securities of the
Corporation other than shares of Common Stock or in assets (excluding cash
dividends or distributions), then and in each such event provision shall be made
so that the holders of the Class A Stock shall receive upon conversion thereof
in addition to the number of shares of Common Stock receivable thereupon, the
number of securities or such other assets of the Corporation which they would
have received had their Class A Stock been converted into Common Stock on the
date of such event and had they thereafter, during the period from the date of
such event to and including the Conversion Date, retained such securities or
such other assets receivable by them as aforesaid during such period, giving
application to all adjustments called for during such period under this Section
4 with respect to the rights of the holders of the Class A Stock.

            (g) RECAPITALIZATION OR RECLASSIFICATION. If the Common Stock of the
Corporation shall be changed into the same or different number of shares of any
class or classes of stock of the Corporation, whether by recapitalization,
reclassification or otherwise (other than a subdivision or combination of shares
or stock dividend provided for elsewhere in the Articles of Incorporation, as
amended, or a reorganization, merger, consolidation or sale of assets provided
for elsewhere in the Articles of Incorporation, as amended), then and in each
such event the holder of each share of Class A Stock shall have the right
thereafter to convert such shares into the kind and amount of shares of stock
and other securities and property receivable upon such reorganization,
reclassification or other change by holders of the number of shares of Common
Stock into which such share of Class A Stock would have been converted (taking
into account all accrued and unpaid dividends and interest with respect to such
Class A Stock) immediately prior to such reorganization, reclassification or
change, all subject to further adjustment as provided herein.

            (h) CAPITAL REORGANIZATION, MERGER OR SALE OF ASSETS. If at any time
or from time to time there shall be a capital reorganization of the Common Stock
or a merger or

                                                                              27

<PAGE>   5
consolidation of the Corporation with or into another corporation, or the sale
of all or substantially all of the Corporation's properties and assets to any
other person followed by a liquidation of the Corporation, then, as a part of
such transaction, provision shall be made so that the holders of each share of
the Class A Stock shall thereafter be entitled to receive the number of shares
of stock or other securities or property of the Corporation, or of the successor
corporation resulting from such merger or consolidation, to which a holder of
Common Stock issuable upon conversion of such share of Class A Stock would have
been entitled on such transaction. In any such case, appropriate adjustment
shall be made in the application of the provisions of this Section 4 with
respect to the rights of the holders of the Class A Stock after such transaction
to the end that the provisions of this Section 4 (including adjustment of the
Conversion Price then in effect and the number of shares purchasable upon
conversion of the Class A Stock) shall be applicable after that event in as
nearly equivalent a manner as may be practicable.

         Notwithstanding the preceding paragraph, each holder of Class A Stock,
upon the occurrence of a capital reorganization, merger or consolidation of the
Corporation, or the sale of all or substantially all its assets and properties,
which is deemed a liquidation pursuant to Section 2(b) above, shall have the
option of electing treatment of his shares of Class A Stock under either this
Section 4(h) or, to the extent applicable, Section 2 hereof. A notice of such
election shall be submitted in writing to the Corporation at its principal
offices no later than ten (10) days before the effective date of such event,
but, if a holder fails to make any election, he shall be deemed to have elected
the benefits of Section 2 hereof to the extent applicable.

            (i) SALE OF SHARES BELOW CONVERSION PRICE.

                         (1) If at any time from March 1, 1992 to February 28,
1995 the Corporation issues or sells, or is deemed by the express provisions of
this subparagraph (i) to have issued or sold, Additional Shares of Common Stock
(as hereinafter defined), other than as provided above or upon a subdivision or
combination of shares of Common Stock as provided in subparagraph (h) above, for
an Effective Price (as hereinafter defined) less than the then existing
Conversion Price for the Class A Stock (or, if an adjusted Conversion Price
shall be in effect for the Class A Stock by reason of a previous adjustment,
then less than such adjusted Conversion Price), then and in each such case the
then existing Conversion Price for the Class A Stock shall be reduced, as of the
opening of business on the date of such issue or sale, by the Corporation to the
Effective Price for each such share of Additional Shares of Common Stock so
issued.

                         (2) For the purpose of making any adjustment required
under this subparagraph (i), the consideration received by the Corporation for
any issue or sale of securities shall (A) to the extent it consists of cash be
computed at the net amount of cash received by the Corporation after the
deduction of any expenses payable by the Corporation and any underwriting or
similar commissions, compensation, or concessions paid or allowed by the
Corporation in connection with such issue or sale, (B) to the extent it consists
of property other than cash, be computed at the fair value of that property as
determined in good faith by the Board, and (C) if Additional Shares of Common
Stock, Convertible Securities (as hereinafter defined) or rights or options to
purchase either Additional Shares of Common Stock or Convertible Securities are
issued or sold together with other stock or securities or other assets of the
Corporation for a consideration which covers both, be computed as the portion of
the consideration so received that may be reasonably determined in good faith by
the Board to be allocable to such Additional Shares of Common Stock, Convertible
Securities or rights or options.

                                                                              28

<PAGE>   6
                         (3) For the purpose of the adjustment required under
this subparagraph (i), if the Corporation issues or sells any rights or options
for the purchase of, or stock or other securities convertible into, Additional
Shares of Common Stock (such convertible stock or securities being hereinafter
referred to as "Convertible Securities") and if the Effective Price of such
Additional Shares of Common Stock is less than the Conversion Price then in
effect for the Class A Stock, then in each case the Corporation shall be deemed
to have issued at the time of the issuance of such rights or options or
Convertible Securities the maximum number of Additional Shares of Common Stock
issuable upon exercise or conversion thereof and to have received as
consideration for the issuance of such shares an amount equal to the total
amount of the consideration, if any, received by the Corporation for the
issuance of such rights or options or Convertible Securities, plus, in the case
of such rights or options, the minimum amounts of consideration, if any, payable
to the Corporation upon the exercise of such rights or options, plus, in the
case of Convertible Securities, the minimum amounts of consideration, if any,
payable to the Corporation (other than by cancellation of liabilities or
obligations evidenced by such Convertible Securities) upon the conversion
thereof. No further adjustment of the Conversion Price for the Class A Stock
shall be made as a result of the actual issuance of Additional Shares of Common
Stock on the exercise of any such rights or options or the conversion of any
such Convertible Securities. If any such rights or options or the conversion
privilege represented by any such Convertible Securities shall expire or
otherwise terminate without having been exercised, the Conversion Price for the
Class A Stock adjusted upon the issuance of such rights, options or Convertible
Securities shall be readjusted to the Conversion Price for the Class A Stock
which would have been in effect had an adjustment been made on the basis that
the only Additional Shares of Common Stock so issued were the Additional Shares
of Common Stock, if any, actually issued or sold on the exercise of such rights
or options or rights of conversion of such Convertible Securities, and such
Additional Shares of Common Stock, if any, were issued or sold for the
consideration actually received by the Corporation upon such exercise, plus the
consideration, if any, actually received by the Corporation for the granting of
all such rights or options, whether or not exercised, plus the consideration
received for issuing or selling the Convertible Securities actually converted,
plus the consideration if any, actually received by the Corporation (other than
by cancellation of liabilities or obligations evidenced by such Convertible
Securities) on the conversion of such Convertible Securities.

                         (4) For the purpose of the adjustment required under
this paragraph (i), if the Corporation issues or sells any rights or options for
the purchase of Convertible Securities and if the Effective Price of the
Additional Shares of Common Stock underlying such Convertible Securities is less
than the Conversion Price then in effect for the Class A Stock, then in each
such case the Corporation shall be deemed to have issued at the time of the
issuance of such rights or options the maximum number of Additional Shares of
Common Stock issuable upon conversion of the total amount of Convertible
Securities covered by such rights or options and to have received as
consideration for the issuance of such Additional Shares of Common Stock an
amount equal to the amount of consideration, if any, received by the Corporation
for the issuance of such rights or options, plus the minimum amounts of
consideration, if any, payable to the Corporation upon the exercise of such
rights or options and plus the minimum amount of consideration, if any, payable
to the Corporation (other than by cancellation of liabilities or obligations
evidenced by such Convertible Securities) upon the conversion of such
Convertible Securities. No further adjustment of the Conversion Price shall be
made as a result of the actual issuance of the Convertible Securities upon the
exercise of such rights or options or upon the actual issuance of Additional
Shares of Common Stock upon the conversion of such Convertible Securities. The
provisions of subparagraph (3) above for the readjustment of the Conversion
Price for the Class

                                                                              29

<PAGE>   7
A Stock upon the expiration of rights or options or the rights of conversion of
Convertible Securities shall apply mutatis mutandis to the rights, options and
Convertible Securities referred to in this subparagraph (4).

                         (5) "Additional Shares of Common Stock" shall mean all
shares of Common Stock issued by the Corporation after the issuance date of the
Class A Stock, whether or not subsequently reacquired or retired by the
Corporation, other than (A) shares of Common Stock issued to employees or
directors of or consultants and advisers to the Corporation or any Subsidiary
pursuant to an existing stock purchase or stock option plans or other
arrangements approved by the Board so long as the aggregate number of shares
issued after the issuance date of the Class A Stock does not exceed 1,000,000
shares and (B) shares of Common Stock issued upon the exercise of warrants or
convertible debentures issued by the Corporation prior to the issuance date of
the Class A Stock. The "Effective Price" of Additional Shares of Common Stock
shall mean the quotient determined by dividing the total number of Additional
Shares of Common Stock issued or sold, or deemed to have been issued or sold by
the Corporation under this paragraph (i), into the aggregate consideration
received, or deemed to have been received by the Corporation for such issue
under this paragraph (i), for such Additional Shares of Common Stock. If, at any
time or from time to time after the issuance date of the Class A Stock the
Corporation effects a subdivision or combination of the outstanding Common Stock
or makes a dividend or other distribution payable in additional shares of Common
Stock, then the aggregate number of shares specifically excluded from the
definition of Additional Shares of Common Stock in (C) of this subparagraph (5)
shall be increased or decreased appropriately to reflect such subdivision,
combination, dividend, or other distribution.

            (j) ACCOUNTANT'S CERTIFICATE AS TO ADJUSTMENTS. In each case of an
adjustment or readjustment of the Conversion Rate, the Corporation will furnish
each holder of Class A Stock with a certificate, prepared by its chief financial
officer showing such adjustment or readjustment, and stating in detail the facts
upon which such adjustment or readjustment is based. Upon the request of the
holders of a majority of the Class A Stock, the Corporation will cause its
independent public accountants to confirm the accuracy of such adjustment or
readjustment.

            (k) PARTIAL CONVERSION. In the event some but not all of the shares
of Class A Stock represented by a certificate or certificates surrendered by a
holder are converted, the Corporation shall execute and deliver to or on the
order of the holder, at the expense of the Corporation, a new certificate
representing the number of shares of Class A Stock which were not converted.

            (l) RESERVATION OF COMMON STOCK. The Corporation shall at all times
reserve and keep available out of its authorized but unissued shares of Common
Stock, solely for the purpose of effecting the conversion of the shares of the
Class A Stock, such number of its shares of Common Stock as shall from time to
time be sufficient to effect the conversion of all outstanding shares of the
Class A Stock, and if at any time the number of authorized but unissued shares
of Common Stock shall not be sufficient to effect the conversion of all then
outstanding shares of the Class A Stock, the Corporation shall take such
corporate action as may be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such
purpose.

                                                                              30

<PAGE>   8
         5. AUTOMATIC CONVERSION.

            (a) PUBLIC OFFERING. Each share of Class A Stock shall automatically
be converted into shares of Common Stock based on the then effective Conversion
Rate for the Class A Stock immediately upon (A) the closing of an underwritten
public offering pursuant to an effective registration statement under the
Securities Act of 1933, as amended, covering the offering and sale of Common
Stock for the account of the Corporation in which the aggregate gross proceeds
received by the Corporation at the public offering price equals or exceeds
$5,000,000, the public offering price per share of which equals or exceeds a
price per share of Common Stock of Six Dollars ($6.00) and the obligation of the
underwriters with respect to which is that if any of the securities being
offered are purchased, all such securities must be purchased; (B) the
commencement date of the Phase III Clinical Trials for the Corporation's LYM-1
antibody; or (C) the closing of a consolidation or merger of the Corporation
with another corporation in which the Corporation is not the surviving entity,
provided that the holders of Common Stock receive in cash (or cash equivalents)
or marketable securities which are of a class of securities registered under
Section 12 of the Securities Exchange Act of 1934 and which are not restricted
as to resale under the Securities Act of 1933, a sum equal to or in excess of
Six Dollars ($6.00) per share; provided, however, that such conversion shall be
conditioned upon payment, or declaration and setting aside of a sum sufficient
for payment, by the Corporation of all declared but unpaid dividends on the
outstanding Class A Stock payable either in cash or Common Stock (valued at the
Common Stock's fair market value), or both.

            (b) MECHANICS OF CONVERSION. Upon the occurrence of either event
specified in paragraph (a) above, the outstanding shares of Class A Stock shall
be converted automatically without any further action by the holders of such
shares and whether or not the certificates representing such shares are
surrendered to the Corporation or its transfer agent; provided, however, that
the Corporation shall not be obligated to issue certificates evidencing the
shares of Common Stock issuable upon such conversion unless the certificates
evidencing such shares of Class A Stock are either delivered to the Corporation
or its transfer agent as provided below, or the holder notifies the Corporation
or its transfer agent that such certificates have been lost, stolen or destroyed
and executes an agreement satisfactory to the Corporation to indemnify the
Corporation from any loss incurred by it in connection with the certificates.
Upon the occurrence of such automatic conversion of Class A Stock, the holders
of Class A Stock shall surrender the certificates representing such shares at
the office of the Corporation or any transfer agent for the Common Stock.
Thereupon, there shall be issued and delivered to such holder promptly at such
office and in its name as shown on such surrendered certificate or certificates,
a certificate or certificates for the number of shares of Common Stock into
which the shares surrendered were convertible on the date on which such
automatic conversion occurred, and the Corporation shall promptly pay in cash or
Common Stock (taken at the Common Stock's fair market value as of the date of
such conversion), or both, all declared but unpaid dividends on the shares being
converted.

         6. NO REISSUANCE OF THE PREFERRED STOCK. No share or shares of the
Class A Stock acquired by the Corporation by reason of redemption, purchase,
conversion or otherwise shall be reissued. The Corporation may from time to time
take such appropriate corporate action as may be necessary to reduce the
authorized number of shares of the Class A Stock accordingly.

         7. RESTRICTIONS AND LIMITATIONS. So long as at least 50% of the shares
of the Class A Stock authorized upon the filing of this Certificate remain
outstanding, the Corporation shall

                                                                              31

<PAGE>   9
not, and shall not permit any subsidiary to, without the affirmative vote or
written consent by the holders of more than 50% of the outstanding shares of
Class A Stock, voting as a single class:

            (a) PURCHASES. Purchase, redeem or otherwise acquire (or pay into or
set aside for a sinking fund for such purpose) any of the Common Stock or
Preferred Stock junior to such series; provided, however, that this restriction
shall not apply to the repurchase of less than $100,000 during any one year of
shares of Common Stock from employees, consultants or other persons providing
services to the Corporation or any of its subsidiaries pursuant to an agreement
under which the Corporation has the option or the obligation to repurchase such
shares upon the occurrence of certain events, including the termination of
employment;

            (b) DIVIDENDS. Declare or pay any dividends on or declare or make
any other distribution, direct or indirect, (other than a dividend payable
solely in shares of Common Stock or rights or options to purchase Common Stock)
on account of the Common Stock or set apart any sum for any such purpose;

            (c) SALE OF ASSETS. Effect any sale, lease, assignment, transfer or
other conveyance of all or substantially all of the assets of the Corporation or
any corporation more than 50% of whose outstanding voting stock is owned by the
Corporation, or any consolidation or merger involving the Corporation or any of
its subsidiaries (excluding any merger or consolidation solely among the
Corporation and/or its wholly-owned subsidiaries and any merger in which the
Corporation is the surviving entity and the shareholders of the Corporation
immediately preceding the consummation of the merger hold more than 60% of the
voting power of the Corporation immediately following the consummation of the
merger), or any recapitalization, or any dissolution, liquidation or winding up,
of the Corporation, or make any agreement or become obligated to do so, unless
the obligations of the Corporation under such agreement are expressly
conditioned upon the approval required by this paragraph 7;

            (d) SUBSIDIARY. Except for the formation of foreign subsidiaries
whose primary purpose is the distribution of the Corporation's products or any
subsidiaries existing on the date hereof, acquire more than a five percent (5%)
interest in any other corporation or entity; or

            (e) ACCOUNTING. Adopt any material changes in the Corporation's
accounting policies and procedures other than those changes deemed necessary to
comply with generally accepted accounting principles consistently applied.

         8. NOTICES OF RECORD DATE. In the event of any taking by the
Corporation of a record of the holders of any class of securities for the
purpose of determining the holders thereof who are entitled to receive any
dividend or other distribution, or to receive any other right, or any capital
reorganization of the Corporation, any reclassification or recapitalization of
the capital stock of the Corporation, any merger or consolidation of the
Corporation, or any transfer of all or substantially all of the assets of the
Corporation to any other corporation, or any other entity or person, or any
voluntary or involuntary dissolution, liquidation or winding up of the
Corporation, then and in each such event the Corporation shall mail or cause to
be mailed to each holder of Class A Stock a notice specifying (i) the date on
which any such record is to be taken for the purpose of such dividend,
distribution or right and a description of such dividend, distribution or right,
(ii) the date on which any such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution, liquidation or
winding up is expected to become effective, (iii) the time, if any,

                                                                              32

<PAGE>   10
that is to be fixed, as to when the holders of record of Common Stock (or other
securities) shall be entitled to exchange their shares of Common Stock (or other
securities) for securities or other property deliverable upon such
reorganization, reclassification, recapitalization, transfer, consolidation,
merger, dissolution, liquidation or winding up. Such notice shall be mailed at
least 30 days prior to the date specified in such notice on which such action is
to be taken.

            9. COMMON STOCK. All rights accruing to the outstanding shares of
this Corporation not expressly provided for to the contrary herein shall be
vested in the Common Stock.

                                   ARTICLE IV

            The liability of the directors of this Corporation for monetary
damages shall be eliminated to the fullest extent permissible under California
law.

                                    ARTICLE V

            This Corporation is authorized to indemnify the directors and
officers of this Corporation to the fullest extent permissible under California
law and in excess of that otherwise permitted under Section 317 of the
California Corporations Code."

            3. The foregoing amendment and restatement of the articles of
incorporation has been duly approved by the Board of Directors of this
Corporation.

            4. The foregoing amendment and restatement of the articles of
incorporation has been duly approved by the required vote of shareholders in
accordance with Sections 902 and 903 of the California General Corporation Law.
The Corporation has two classes of stock outstanding and each class of stock is
entitled to vote with respect to the foregoing amendment and restatement of the
articles of incorporation. The total number of outstanding shares of Common
Stock of this Corporation is 14,112,613 and the total number of outstanding
shares of Class A Convertible Preferred Stock is 10,000. The number of shares
voting in favor of the amendment and restatement exceeded the vote required. The
percentage vote required was more than fifty percent (50%) with respect to the
Common Stock and more than fifty percent (50%) with respect to the Class A
Convertible Preferred Stock.

         The undersigned further declares under penalty of perjury that the
matters set forth in the foregoing Amended and Restated Articles of
Incorporation are true and correct of their own knowledge.

         Executed at Tustin, California, on June 30, 1994.


                                           /s/ Lon H. Stone
                                           --------------------------------
                                           Lon H. Stone, President

                                           /s/ William V. Moding
                                           --------------------------------
                                           William V. Moding, Secretary

                                                                              33



<PAGE>   1
                     TECHNICLONE INTERNATIONAL CORPORATION
                            A CALIFORNIA CORPORATION

                 REGULATION S SECURITIES SUBSCRIPTION AGREEMENT

         THE PREFERRED STOCK BEING SUBSCRIBED FOR HEREIN AND THE COMMON STOCK
ISSUABLE UPON CONVERSION OF THE PREFERRED STOCK (COLLECTIVELY THE "SECURITIES")
HAVE NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES A CT OF 193 3, A S AMENDED, (THE "ACT') OR THE
SECURITIES COMMISSION OF ANY STATE UNDER ANY STATE SECURITIES LAW THEY ARE BEING
OFFERED PURSUANT TO A SAFE HARBOR FROM REGISTRATION UNDER REGULATION S
("REGULATION S') PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED IN THE UNITED STATES OR TO U.S. PERSONS (AS SUCH
TERM IS DEFINED IN REGULATION S) UNLESS THE SECURITIES ARE REGISTERED UNDER THE
ACT AND APPLICABLE STATE SECURITIES LAWS, OR SUCH OFFERS, SALES AND TRANSFERS
ARE MADE PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THOSE LAWS.

         THIS SUBSCRIPTION AGREEMENT DOES NOT CONSTITUTE AN OFFER TO SELL, OR A
SOLICITATION OF AN OFFER TO BUY, ANY OF THE SECURITIES OFFERED HEREBY TO ANY
PERSON IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION WOULD BE
UNLAWFUL. INVESTMENT
 IN SUCH SECURITIES INVOLVES A HIGH DEGREE OF RISK IN MAKING
AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE
COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND THE RISKS
INVOLVED. THESE SECURITIES HAVE NOT BEEN RECOMMENDED, APPROVED OR DISAPPROVED BY
ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE,
THE FOREGOING AUTHORITIES HAVE NOT REVIEWED, PASSED UPON, CONFIRMED OR
DETERMINED THE ACCURACY OR ADEQUACY OF THIS DOCUMENT OR A NY INFORMATION
PROVIDED BY THE COMPANY TO POTENTIAL INVESTORS ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.

         This Regulation S Securities Subscription Agreement (the "Agreement")
is executed by the undersigned (the "Subscriber") in connection with the offer
and subscription by the undersigned for 10% Class B Convertible Preferred Stock
$ 1. 00 par value per share (the "Preferred Stock") of Techniclone International
Corporation, a California corporation (the "Company"). The Preferred Stock is
being offered in increments of at least 50 shares, at a purchase price of $1,000
per Preferred Share or $50,000 up to a maximum amount of 10,000 shares of
Preferred Stock or $10.0 million (the "Offering"). The terms of the Preferred
Stock, including the terms on which the Preferred Stock may be converted into
common stock, no par value of the Company (the "Common Stock"), are set forth in
the Certificate of Determination of Class B Convertible Preferred Stock (the
"Certificate of Determination"), in substantially the form attached hereto as
Exhibit A. The solicitation of this Subscription and, if accepted by the
Company, the offer and sale of Preferred Stock, are being made in reliance upon
the provisions of Regulation S ("Regulation S") promulgated under the United
States Securities Act of 1933, as amended (the "Act"). The Preferred Stock, and
the Common Stock issuable upon conversion thereof (the "Shares"), are sometimes
referred to herein collectively as the "Securities." The

                                  EXHIBIT 4.1                                 34

<PAGE>   2
Subscriber wishes to subscribe for Preferred Stock in the amount set forth in
Section 17 in accordance with the terms and conditions of the form of Preferred
Shares and this Agreement. It is agreed as follows:

1.       Offer to Subscribe; Purchase Price and Closing; and Placement Fees

         The Subscriber hereby offers to subscribe for and purchase Preferred
         Stock, for the aggregate purchase price set out in Section 17 of this
         Agreement. Subscriber agrees that Company may reduce the aggregate
         amount of Preferred Stock subscribed for pursuant hereto if, in the
         Company's discretion, the Offering is over-subscribed. Assuming that
         the minimum placement amount of $5 million (or less, if accepted by the
         Company) and corresponding subscription agreements accepted by the
         Company are received into the Company's designated escrow account for
         this Offering (the "Escrow Account") no later than December 22, 1995
         (the "Offering Termination Date"), the closing as to each Subscriber
         (the"Closing") shall be deemed to occur when this Agreement has been
         executed by both the Subscriber and the Company and payment shall have
         been made by the Subscriber, by wire transfer, as directed in writing
         by the Company, to the Company's designated escrow account, for payment
         in consideration for the Company's delivery of certificates
         representing the Preferred Stock subscribed for. If the Closing does
         not occur on or prior to December 22, 1995, the Escrow Agent will be
         instructed to release to Subscriber its subscription payment, with
         interest accrued from receipt of such payment into the Escrow Account
         under the terms of the Escrow Account, as soon as practicable
         thereafter in accordance with wire instructions provided by Subscriber.
         The parties hereto acknowledge that Swartz Investments, Inc, is acting
         as placement agent (the "Placement Agent") for this Offering, and will
         be compensated by the Company.

2.       Representations; Access to Information; Independent Information;
         Independent Investigation

         2.1     Offshore Transaction. The Subscriber represents and warrants to
                 the Company that (i) the Subscriber is not a "U.S. person" as
                 that term is defined in Rule 902(o) of Regulation S (a copy of
                 which definition is attached as Exhibit B) including, without
                 limitation if a business organization, such as a corporation or
                 partnership, (a) it is organized under the laws of a
                 jurisdiction other than the United States and (b) if organized
                 by a "U.S. Person" principally for the purpose of investing in
                 securities not registered under the Act, it was organized and
                 is owned by accredited investors (as defined in Rule 501 (a) of
                 Regulation D under the Act) who are not natural persons,
                 estates or trusts; (ii) the Securities were not offered to the
                 Subscriber in the United States and at the time of the
                 execution of this Subscription Agreement and the time of any
                 offer to the Subscriber to purchase the Securities hereunder,
                 the Subscriber was physically outside the United States; (iii)
                 the Subscriber is purchasing the Securities for its own account
                 and not on behalf of or for the benefit of any U.S. person and
                 the sale and resale of the Securities have not been prearranged
                 with any U.S. person or buyer in the United States; (iv) the
                 Subscriber agrees, and to the best knowledge of the Subscriber
                 each distributor, if any, participating in the offering of the
                 Securities, has agreed, that all offers and sales of the
                 Securities prior to the expiration of a period commencing on
                 the date of the last Closing of a sale and purchase of

                                                                              35

<PAGE>   3
                 Preferred Stock (the "Last Closing") and ending ninety days
                 thereafter (the "Restricted Period") shall not be made to U.S.
                 persons or for the account or benefit of U.S. persons.
                 Subscriber is not a distributor or dealer with respect to the
                 Securities.

         2.2     Subscriber's Independent Investigation. The Subscriber, in
                 offering to subscribe for the Securities hereunder, has relied
                 solely upon an independent investigation made by it and its
                 representatives, if any, and has, prior to the date hereof,
                 been given access to and the opportunity to examine all books
                 and records of the Company, and all material contracts and
                 documents of the Company which have been filed as exhibits to
                 the Company's filings made under the Act and the Securities
                 Exchange Act of 1934, as amended. In making its investment
                 decision to purchase the Preferred Stock, the Subscriber is not
                 relying on any oral or written representations or assurances
                 from the Company or any other person or any representation of
                 the Company or any other person other than as set forth in this
                 Agreement, or on any information other than that contained in
                 the Company's Annual Report on Form 10-K for the year ended
                 April 30, 1995 and (ii) Quarterly Report on Form I O-Q for the
                 quarter ended July 31. 1995. The Subscriber has relied upon a
                 representation of Swartz Investments, Inc. that Swartz did not
                 offer the Preferred Stock to any Subscribers in the U.S. or to
                 any person in the U.S. (unless they have signed the required
                 fiduciary certificate), or any U.S. person. The Subscriber has
                 such experience in business and financial matters that it is
                 capable of evaluating the risk of its investment and
                 determining the suitability of its investment. The Subscriber
                 is an accredited investor as defined in Rule 501 of Regulation
                 D, a copy of which definition is attached hereto as Exhibit C.

         2.3     Subscriber's Economic Risk. The Subscriber understands and
                 acknowledges that an investment in the Securities involves a
                 high degree of risk. The Subscriber represents that the
                 Subscriber is able to bear the economic risk of an investment
                 in the Securities, which Subscriber acknowledges are currently
                 illiquid and may remain illiquid indefinitely, including a
                 possible total loss of investment. in making this statement the
                 Subscriber hereby represents and warrants to the Company that
                 the Subscriber has adequate means of providing for the
                 Subscriber's current needs and contingencies; the Subscriber is
                 able to afford to hold the Securities for an indefinite period
                 and the Subscriber further represents that the Subscriber has
                 such knowledge and experience in financial and business matters
                 that the Subscriber is capable of evaluating the merits and
                 risks of the investment in the Securities to be received by the
                 Subscriber. Further, the Subscriber represents, as of the date
                 of signing this Agreement, that the Subscriber has no present
                 need for liquidity in the Securities and the Subscriber is
                 willing to accept such investment risks.

         2.4     No Government Recommendation or Approval. The Subscriber
                 understands that no United States federal or state agency, or
                 similar agency of any other country, has reviewed, approved,
                 passed upon or made any recommendation or endorsement of the
                 Company, the Offering or the subscription of the Securities.

                                                                              36

<PAGE>   4
         2.5     No Directed Selling Efforts in Regard to this Transaction. To
                 the best of the knowledge of the Subscriber and Company,
                 neither the Company nor any distributor participating in the
                 Offering, nor any person acting for the Company or any such
                 distributor, has conducted any "directed selling efforts" in
                 the United States as the term "directed selling efforts" is
                 defined in Rule 902 of Regulation S (without the subscriber
                 having undertaken any investigation or inquiry), which in
                 general, means any activity undertaken for the purpose of, or
                 that could reasonably be expected to have the effect of,
                 conditioning the market in the United States for any of the
                 Securities being offered. Such activity includes, without
                 limitation, the mailing of printed material to investors
                 residing in the United States, the holding of promotional
                 seminars in the United States, and the placement of
                 advertisements with radio or television stations broadcasting
                 in the United States or in publications with a general
                 circulation in the United States, which discuss the offering of
                 the Securities.

         2.6     Company's Reliance on Representations of Subscribers. This
                 Agreement is made by the Company with each Subscriber in
                 reliance upon such Subscriber's representations and covenants
                 made in this Section 2, which reliance by his execution of this
                 Agreement the Subscriber hereby confirms.

         2.7     Securities Not Registered Under Securities Act. Subscriber
                 understands that the Preferred Stock and the Common Stock
                 issuable upon conversion of the Preferred Stock (the "Shares")
                 have not been registered under the Act or any state securities
                 laws ("State Acts") and are being offered and sold pursuant to
                 Regulation S based in part upon the representations of
                 Subscriber contained herein. The Common Stock does, however,
                 carry certain registration rights as set forth in the
                 Registration Rights Agreement executed by the parties hereto.

         2.8     No Public Solicitation. Subscriber knows of no public
                 solicitation or advertisement of an offer in connection with
                 the proposed issuance and sale of the Securities.

         2.9     Investment Intent (Including No Present Intent to Sell
                 Securities at PreDetermined Time). Subscriber is acquiring the
                 Preferred Stock to be issued and sold hereunder (and the Shares
                 issuable upon conversion of the Preferred Stock) for his, her
                 or its own account (or a trust account if such Subscriber is a
                 trustee) for investment and not as a nominee and not with a
                 view to the distribution thereof Subscriber understands that
                 Subscriber must bear the economic risk of this investment
                 indefinitely unless such Preferred Stock or such Shares are
                 registered pursuant to the Act and any applicable State Acts,
                 or an exemption from such registration is available, and that
                 the Company has no present intention of registering any such
                 sale of the Preferred Stock or such Shares, Subscriber
                 represents and warrants to the Company that as of the date of
                 this Agreement, Subscriber has no present plan or intention to
                 sell the Preferred Stock or the Shares in the United States at
                 any predetermined time, and has made no predetermined
                 arrangements to sell the Preferred Stock or the Shares.
                 Subscriber covenants that neither Subscriber nor its affiliates
                 nor any person acting on its or their behalf has entered, has
                 the intention of entering, or will enter into any put

                                                                              37

<PAGE>   5
                 option, short position or other similar instrument or position
                 in the U.S. with respect to the Preferred Stock or Common Stock
                 of the Company anytime after receipt of the term sheet from
                 Swartz Investments concerning this Regulation S Offering until
                 the end of the Restricted Period, or for purposes of lowering
                 the price at which the Preferred Stock are convertible into
                 Shares and neither Subscriber nor any of its affiliates nor any
                 person acting on its or their behalf will at any time use
                 Shares acquired upon conversion of the Preferred Stock to
                 settle/cover any put option, short position or other similar
                 instrument or position.

         2.10    Subscriber Not to Sell or Transfer Securities in Violation of
                 the Securities Laws. Subscriber covenants that he, she or it
                 will not make any sale, transfer or other disposition of the
                 Preferred Stock or the Shares in violation of the Act
                 (including Regulation S), the Securities Exchange Act of 1934,
                 as amended (the "Exchange Act"), any applicable State Acts or
                 the rules and regulations of the Securities and Exchange
                 Commission (the "Commission") or of any state securities
                 commissions or similar state authorities promulgated under any
                 of the foregoing.

         2.11    Subscriber's Power and Authority. Subscriber has the full power
                 and authority to execute, deliver and perform this Agreement.
                 This Agreement, when executed and delivered by Subscriber, will
                 constitute a valid and legally binding obligation of
                 Subscriber, enforceable in accordance with its terms.

         2.12    Signatory's Representation. The signatory to this Agreement
                 hereby represents and warrants that he, she or it is:

                 (a) not a U. S. Person (as defined in Regulation S), and is not
                 located in the U. S. at the time of signing this Agreement.

                 If the signatory to this Agreement does not meet the
                 requirement in sub-section (a) herein, signatory represents he,
                 she or it is:

                 (b) a professional fiduciary of Subscriber (as described in
                 Section (o)(2) through (o)(4) of Rule 902 of Regulation S),
                 acting solely in his capacity as holder of such account, as a
                 fiduciary, executor or trustee, and has completed and signed
                 the accompanying Certificate (Exhibit D) and forwarded it to
                 Swartz Investments, Inc.

         2.13    No Tax Advice From Company. Subscriber has reviewed with his,
                 her or its own tax advisors the foreign, U.S. federal, state
                 and local tax consequences of this investment, and the
                 transactions contemplated by this Agreement. Subscriber is
                 relying solely on such advisors and not on any statements or
                 representations of the Company or any of its agents and
                 understands that Subscriber (and not the Company) shall be
                 responsible for the Subscriber's own tax liability that may
                 arise as a result of this investment or the transactions
                 contemplated by this Agreement.

         2.14    No Legal Advice from Company. Subscriber acknowledges that he,
                 she, or it has had the opportunity to review this Agreement and
                 the transactions contemplated by this Agreement with his, or
                 her or its own legal counsel. Subscriber is relying solely on
                 such counsel and not on any statements or representations of
                 the

                                                                              38

<PAGE>   6
                 Company or any of its agents for legal advice with respect to
                 this investment or the transactions contemplated by this
                 Agreement, except for the representations, warranties and
                 covenants set forth herein and in the opinion provided for in
                 paragraph 7.3 herein.

         2.15    Offering Material Statements. Subscriber acknowledges and
                 agrees that all offering materials and documents used in
                 connection with the offers and sales of the Securities to it
                 included statements to the effect of those contained in the
                 first fall capitalized paragraph of this Agreement.

         2.16    No Scheme to Evade Registration. Subscriber's acquisition of
                 the Securities is not a transaction (or any element of a series
                 of transactions) that is part of a plan or scheme to evade the
                 registration provisions of the Act.

3.       Resales of Securities by Subscriber

         Subscriber acknowledges, covenants and agrees that the Securities may
and will only be resold by it (a) in compliance with Regulation S and applicable
State Acts, if any; or (b) pursuant to an exemption from registration under the
Act and applicable State Acts, if any; or c) pursuant to an effective and
current Registration Statement under the Act. In addition, in connection with
any resale of the Preferred Stock in accordance with clause (a) or (b), above,
the subscriber will deliver to the Company and will cause the purchaser to
deliver to the Company following documents:

         3.1     Documents to be Delivered for Offshore Regulation S Resales. If
                 the shares of Preferred Stock are being resold in compliance
                 with Regulation S:

                 1.       Sales Agreement, executed by Subscriber and Purchaser
                          (in the form of Exhibit E);
                 2.       Seller Representation Letter (in the form of Exhibit
                          F);
                 3.       Assignment Separate from Certificate (in the form of
                          Exhibit G) (or endorsed Certificates);
                 4.       Seller's Instruction Letter (in the form of Exhibit
                          H); and
                 5.       Purchaser Representation Letter (in the form of
                          Exhibit 1).

         3.2     Documents to be Delivered for Resales into the United States.
                 If the shares of Preferred Stock are being resold pursuant to
                 an exemption from registration under the Act other than
                 Regulation S:

                 1.       Sales Agreement, executed by both Subscriber and
                          Purchaser (in the form of Exhibit E);
                 2.       Seller Representation Letter (in the form of Exhibit
                          J);
                 3.       Assignment Separate from Certificate (in the form of
                          Exhibit G) (or endorsed Certificates);
                 4.       Seller's Instruction Letter (in the form of Exhibit
                          H); and
                 5.       Purchaser Representation Letter (in the form of
                          Exhibit 1).

                                                                              39

<PAGE>   7
         Upon receipt of the executed documents listed above, the Company will
effect the transfer of the Preferred Stock on the Company's books and will issue
and deliver new Preferred Stock in the purchaser's name within three (3)
business days of such receipt. The provisions of this Section 3 shall not apply
to subsequent resales of Preferred Stock that have been sold by Subscriber in
compliance with this Section 3.

4.       Legends; Subsequent Sale of Securities

         4.1     The certificates representing the Preferred Stock shall bear
                 the first legend set forth in Section 4.1 (a), 4.1 (b) and 4.1
                 (c) below and any other legend or legends as reasonably
                 required to comply with the state, U.S. federal or foreign law.

                 (a)      THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
                          SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY STATE
                          SECURITIES LAW. THEY ARE BEING OFFERED PURSUANT TO A
                          SAFE HARBOR FROM REGISTRATION UNDER REGULATION S
                          ("REGULATION S") PROMULGATED UNDER THE SECURITIES ACT
                          OF 1933, AS AMENDED ("THE ACT"). THE SECURITIES MAY
                          NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
                          UNITED STATES OR TO U.S, PERSONS (AS SUCH TERM IS
                          DEFINED IN REGULATION S) UNLESS THE SECURITIES ARE
                          REGISTERED UNDER THE ACT AND APPLICABLE STATE
                          SECURITIES LAWS, OR SUCH OFFERS, SALES AND TRANSFERS
                          ARE MADE PURSUANT TO AN AVAILABLE EXEMPTION OR SAFE
                          HARBOR FROM THE REGISTRATION REQUIREMENTS OF THOSE
                          LAWS.

                 (b)      THESE SECURITIES MAY NOT BE OFFERED OR SOLD TO OR FOR
                          THE BENEFIT OR ACCOUNT OF A "U.S. PERSON," AS THAT
                          TERM IS DEFINED IN RULE 902(o) OF REGULATIONS, PRIOR
                          TO THE EXPIRATION OF A PERIOD COMMENCING ON THE DATE
                          OF THE LAST CLOSING OF A SALE AND PURCHASE OF THE
                          SECURITIES AND ENDING NINETY DAYS THEREAFTER.

                 (c)      THE ISSUER WILL FURNISH, WITHOUT CHARGE, TO THE HOLDER
                          OF THIS CERTIFICATE, UPON REQUEST, THE POWERS,
                          DESIGNATIONS, PREFERENCES AND RELATIVE PARTICIPATING,
                          OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS AND
                          SERIES OF STOCK OF THE CORPORATION AND THE
                          QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH
                          PREFERENCES AND/OR RIGHTS.

         4.2     Prior to the forty (40) day period following the Last Closing,
                 any Preferred Shoes submitted to the transfer agent to be
                 converted into shares of Common Stock shall bear the Regulation
                 S legend set forth at Section 4.1 (a) of this Agreement.

                                                                              40

<PAGE>   8
                 (a)      Except for Sections 2.1 and 2.9 of this Agreement,
                          which sections are not applicable, each Subscriber
                          asserts that the representations and warranties made
                          by the Subscribers in the Subscription Agreement are
                          true on the date the Subscriber presents the Preferred
                          Shares for transfer, including the fact that he, she
                          or it is not or was not engaged in a plan or scheme to
                          evade the registration provisions of the Securities
                          Act of 1933, as amended, then at any time after the
                          forty (40) day period following the date of Last
                          Closing, any Subscriber issued Preferred Shares
                          pursuant to a Subscription Agreement is entitled to
                          submit its certificate representing the Preferred
                          Shares ("Stock Certificates") to the Transfer Agent to
                          either have the Regulation S restrictive legend set
                          forth in Section 4.1 (a) of the Subscription Agreement
                          ("Regulation S Restrictive Legend") removed or (ii) to
                          convert such Subscribers's Preferred Shares into
                          shares of Converted Stock, the certificates for which
                          shall bear no Regulation S Restrictive Legend.

                 (b)      Except for Sections 2.1 and 2.9 of this Agreement,
                          which sections are not applicable, the representations
                          and warranties made by the Subscribers in the
                          Subscription Agreement remain true upon presentation
                          of the Preferred Shares for transfer, including the
                          fact that he, she or it is not or was not engaged in a
                          plan or scheme to evade the registration provisions of
                          the Securities Act of 1933, as amended, then, at any
                          time after the ninety (90) day period following the
                          date of Last Closing (the "Unrestricted Conversion
                          Period"), any Subscriber issued Preferred Shares
                          pursuant to a Subscription Agreement is entitled to
                          submit its certificate representing the Preferred
                          Shares to the Transfer Agent to either (i) have the
                          Regulation S and contractual restrictive legends set
                          forth in Section 4.1 (a) and (b) of the Subscription
                          Agreement ("Contractual Legend") removed or (ii) to
                          convert such Subscriber's Preferred Shares into shares
                          of Converted Stock, the certificates for which shall
                          bear no Contractual Legend.

                 (c)      Any conversion of the Preferred Shares shall be at the
                          conversion prices (the "Conversion Price") specified
                          in Section 5 of the Certificate of Determination
                          (which Section is set forth in the Irrevocable
                          Instructions Agreement at Exhibit A). Any such
                          conversion shall be accomplished by delivering the
                          Stock Certificates, duly executed for transfer, to be
                          converted along with the notice required by said
                          Section 5 ("Notice of Conversion") to the Transfer
                          Agent. The Preferred Shares so delivered will be
                          converted into shares of Converted Stock (but only in
                          multiples of $50,000).

                 (d)      The Company and Subscribers have agreed that Company
                          will provide the Transfer Agent with irrevocable
                          instructions to convert one or more of any
                          Subscriber's Preferred Shares into shares of Converted
                          Stock upon receipt of valid Notice of Conversion from
                          a Subscriber and the Stock Certificates, duly executed
                          for transfer. The number of shares of Converted Stock
                          into which the Preferred Shares may be converted is
                          hereinafter referred to as the "Conversion Rate" for
                          such Preferred Shares.

                                                                              41

<PAGE>   9
5.       Notice of Issuance of Securities

         The Company will not issue any debt or equity securities for cash in
         public or private capital raising transactions ("Future Offerings") for
         a period of seventy five (75) days after the Last Closing without
         obtaining the prior written approval of Subscribers holding a majority
         of the purchase price of Preferred Stock then outstanding. Furthermore,
         the Company will not conduct any Future Offerings for a period of two
         hundred and forty (240) days after the Last Closing without delivering
         to the Subscriber, at least seven (7) days prior to the closing of such
         issuance, written notice describing the proposed issuance and the terms
         upon which such securities are being issued, and providing the
         Subscriber the option during such seven (7) day period to purchase the
         securities being offered in the Future Offerings on the same terms as
         contemplated by such Future Offerings and in the amount set forth below
         (the limitations referred to in this and the immediately preceding
         sentence are collectively referred to as the "Capital Raising
         Limitation"). The Capital Raising Limitation shall not apply to any
         transaction involving the Company's commercial banking arrangements or
         issuances of securities in connection with a merger, consolidation or
         sale of assets, or in connection with or as part of the same
         transaction as a joint venture or other acquisition or disposition of a
         business, a product or a license by the Company or exercise of options
         by employees, consultants or directors or any transaction with a
         strategic corporate partner. The Capital Raising Limitation also shall
         not apply to the issuance of securities upon exercise or conversion of
         the Company's options, warrants or other convertible securities
         outstanding as of November 24, 1995, or to the grant of additional
         options or warrants, or the issuance of additional securities, under
         any Company stock option or restricted stock plan. The amount of
         securities which a Subscriber is entitled to purchase in such a Future
         Offering shall be a number obtained by multiplying the aggregate amount
         of securities being offered in the Future Offering by a fraction, the
         numerator of which is the purchase price of the Preferred Stock
         purchased by the Subscriber pursuant to this Agreement and the
         denominator of which is the aggregate dollar amount of Preferred Stock
         placed in this Offering.

6.       Representations and Warranties of Company

         Company represents and warrants to Subscriber as follows:

         6.1     Organization, Good Standing, and Qualification. The Company is
                 a corporation duly organized, validly existing and in good
                 standing under the laws of the State of California, USA and has
                 all requisite corporate power and authority to carry on its
                 business as now conducted and as proposed to be conducted. The
                 Company is duly qualified to transact business and is in good
                 standing in each jurisdiction in which the failure to so
                 qualify would have a material adverse effect on the business or
                 properties of the Company and its subsidiaries taken as a
                 whole. The Company, to its knowledge is not the subject of any
                 pending or threatened investigation or administrative or legal
                 proceeding by the Internal Revenue Service, the taxing
                 authorities of any state or local jurisdiction, or the
                 Securities and Exchange Commission which have not been
                 disclosed in the reports referred to in Section 6.5 below.

                                                                              42

<PAGE>   10
         6.2     Corporate Condition. The Company's condition was, in all
                 material respects, as described in the Company's reports filed
                 pursuant to the Exchange Act and provided to Subscriber in
                 accordance with Section 2.2 above as of the dates of such
                 reports. There have been no material adverse changes in the
                 Company's financial condition or business since the date of the
                 latest report, except as described in the Company's press
                 releases, copies of which have been provided to Subscriber.

         6.3     Authorization. All corporate action on the part of the Company
                 by its officers, directors and shareholders necessary for the
                 authorization, execution and delivery of this Agreement, the
                 performance of all obligations of the Company hereunder and the
                 authorization, issuance (or reservation for issuance) and
                 delivery of the Preferred Stock being sold hereunder and
                 issuance of the Common Stock obtainable on conversion of the
                 Preferred Stock have been taken, and this Agreement and the
                 Registration Rights Agreement constitutes a valid and legally
                 binding obligation of the Company, enforceable in accordance
                 with its terms.

         6.4     Valid Issuance of Preferred Stock and Common Stock. The
                 Preferred Stock, when issued, sold and delivered in accordance
                 with the terms hereof for the consideration expressed herein,
                 will be validly issued, fully paid and nonassessable and, based
                 in part upon the representations of the Subscriber in this
                 Agreement, will be issued in compliance with all applicable
                 U.S. federal and state securities laws. The Common Stock
                 issuable upon conversion of the Preferred Stock when issued in
                 accordance with the terms of the Preferred Stock shall be duly
                 and validly issued and outstanding, fully paid and
                 nonassessable, and based in part on the representations and
                 warranties of Subscriber and any transferee of the Preferred
                 Stock, will be issued in compliance with all applicable U.S.
                 federal and state securities laws.

         6.5     Current Public Information. The Company represents and warrants
                 to the Subscriber that the Company is a "reporting issuer" as
                 defined in Rule 902(l) of Regulation S and it has a class of
                 securities registered under Section 12(b) or 12(g) of the
                 Exchange Act or is required to file reports pursuant to Section
                 15(d) of the Exchange Act, and has filed all the materials
                 required to be filed as reports pursuant to the Exchange Act
                 for a period of at least twelve months preceding the date
                 hereof (or for such shorter period as the Company was required
                 by law to file such material), and all such filings have been
                 made on a timely basis. The Company undertakes to furnish the
                 Subscriber with copies of such information as may be reasonably
                 requested by the Subscriber prior to consummation of this
                 Offering.

         6.6     No Securities Offered in U.S. or to any U.S. Person. The
                 Company represents that the Preferred Stock was not offered to
                 a Subscriber in the U.S. or, to any person in the United States
                 or any U.S. Person (as defined in Regulation S), and has relied
                 upon a representation of Swartz Investments, Inc. that Swartz
                 did not offer the Preferred Stock to any Subscribers in the
                 U.S. or to any person in the U.S. (unless they have signed the
                 required fiduciary certificate), or any U.S. person.

                                                                              43

<PAGE>   11
         6.7     Capitalization Structure of the Company. The capitalization of
                 Company, as of the date of the Closing, as set forth in
                 Exhibit L.

         6.8     Termination Date of Offering. In no event shall the Last
                 Closing of a sale of a Preferred Stock occur later than
                 December 22, 1995.

         6.9     Use of Proceeds. As of the date hereof, the Company expects to
                 use the proceeds from this Offering (less fees and expenses)
                 for the purposes and in the approximate amounts set forth in
                 Exhibit M hereto. These purposes and amounts are estimates and
                 are subject to change.

         6.10    Liquidated Damages for Late Conversion. As set forth in the
                 Certificate of Designation, the Company shall use all
                 reasonable efforts to issue and deliver, within three (3)
                 business days after the Subscriber has fulfilled all conditions
                 and submitted all necessary documents duly executed and in
                 proper form, required for conversion (the "Deadline"), to such
                 Holder of Class B Convertible Preferred Stock at the address of
                 the Holder on the books of the Company, a certificate or
                 certificates for the number of shares of Common Stock to which
                 the Holder shall be entitled upon submission of a notice of
                 conversion. The Company understands that a delay in the
                 issuance of the Shares of Common Stock beyond the Deadline
                 could result in economic loss to the Holder. As compensation to
                 the Holder for such loss, the Company agrees to pay liquidated
                 damages to the Holder for late issuance of Shares upon
                 Conversion in accordance with the following schedule (where
                 "No. Business Days Late" is defined as the number of business
                 days beyond 5 business days from the date of receipt by the
                 Company of a notice of conversion and the transfer agent of all
                 necessary documentation duly executed and in proper form
                 required for conversion, including the original certificate
                 representing the Preferred Shares to be converted, all in
                 accordance with the subscription documents and the requirements
                 of the transfer agent):


<TABLE>
<CAPTION>
                 No. Business Days Late         Liquidated Damages
                 ----------------------         ------------------
                 <S>                            <C>
                               1                     $500
                               2                     $1,000
                               3                     $1,500
                               4                     $2,000
                               5                     $2,500
                               6                     $3,000
                               7                     $3,500
                               8                     $4,000
                               9                     $4,500
                              10                     $5,000
                 Greater than 10                     $5,000 + $1,000 for each
                                                     Business Day Late beyond 10 days
</TABLE>


                 The Company shall pay any liquidated damages incurred under
                 this Section by check within 7 business days from the date of
                 issuance of Shares.



                                                                              44

<PAGE>   12
         6.11    Payment of Accrued Interest on Funds in Escrow. The Company
                 shall pay interest to each Subscriber prior to the Last Closing
                 in an amount equal to 10% per annum of interest of the Original
                 Class B Issue Price (which is $1,000 per share) per annum for
                 the period commencing on the date that, in connection with the
                 consummation of the initial purchase by Subscriber of its
                 shares of Convertible Class B Preferred Stock from the Company,
                 the escrow agent first had in its possession funds representing
                 full payment for such shares of Class B Convertible Preferred
                 Stock and ending on the Last Closing Date. Such payment shall
                 be made by the Company to Subscriber, by check, within 7 days
                 of the date of the Last Closing.

         6.12    Company To Be Listed On NASDAQ Within 120 Days. Company
                 represents that it intends to utilize a portion of the proceeds
                 from this offering so it can be listed on NASDAQ's small
                 capitalization market or NASDAQ's national market system. The
                 Company shall use its best efforts to obtain such listing as
                 soon as practicable, including filing for NASDAQ listing no
                 later than 30 days following the date of Last Closing. If
                 Company fails to obtain the aforementioned NASDAQ listing
                 within 120 days from the date of Last Closing, Company shall be
                 obligated to pay to Subscriber (or any subsequent holder) in
                 Convertible Class B Stock an amount equal to 1.5% per month
                 until such listing is obtained.

         6.13    Planned Increase in Authorized Common Stock

                 Company agrees to recommend to its shareholder at its annual
                 meeting on or before August 1, 1996 that the company increase
                 the authorized number of shares of common stock to 50 million
                 shares.

7.       Covenants of Company

         7.1     Independent Auditors. The Company shall, until at least
                 December 6, 1998, maintain as its independent auditors an
                 accounting firm authorized to practice before the SEC.

         7.2     Corporate Existence and Taxes. The Company shall, until at
                 least the earlier of December 15, 1998, or the conversion or
                 redemption of the Preferred Stock purchased pursuant to this
                 Agreement maintain its corporate existence in good standing
                 (provided, however, that the foregoing covenant shall not
                 prevent the Company from entering into any merger or corporate
                 reorganization as long as the surviving entity in such
                 transaction, if not the Company, assumes the Company's
                 obligations with respect to the Preferred Stock) and shall pay
                 all its taxes when due except for taxes which the Company
                 disputes.

         7.3     Opinion of Counsel. Subscriber shall, upon purchase of the
                 Preferred Stock, receive an opinion letter from outside counsel
                 to the Company, to the effect that (i) the Company is duly
                 incorporated and validly existing under the laws of California;
                 (ii) this Agreement, the Registration Rights Agreement, the
                 issuance of the Preferred Stock, and (assuming there are
                 sufficient authorized shares) the issuance of the Common Stock
                 upon conversion of the Preferred Stock have been



                                                                              45

<PAGE>   13
                 duly authorized by all required corporate action, and that all
                 such Shares, upon delivery, shall be validly issued and
                 outstanding, fully paid and nonassessable; (iii) this Agreement
                 constitutes valid and binding obligations of the Company,
                 enforceable in accordance with their terms, except as
                 enforceability of any indemnification provisions may be limited
                 by principles of public policy, and subject to laws of general
                 application relating to bankruptcy, insolvency and the relief
                 of debtors and rules of laws governing specific performance and
                 other equitable remedies; and (iv) based upon the
                 representations and warranties of the Subscribers contained in
                 the Regulation S Subscription Agreements entered into in
                 connection with the Offering, and assuming that no Subscriber
                 is engaged in a plan or scheme to evade the registration
                 requirements of the Act, the issuance of the Preferred Stock
                 has been effected in compliance with Regulation S, and the
                 issuance of the Shares upon conversion of the Preferred Stock
                 in accordance with their terms by the holders of the Preferred
                 Stock (assuming that no commission or other remuneration is
                 paid or given, directly or indirectly, for soliciting such
                 conversion) will not be subject to the registration provisions
                 of the Act.

         7.4     Registration Rights. The Company will grant Subscriber the
                 registration rights covering the Common Stock issuable on
                 conversion of the Preferred Stock on substantially the terms of
                 the Registration Rights Agreement attached hereto as Exhibit N.

         7.5     Notification of Final Closing Date & Restricted Period by
                 Company. Within five (5) business days after the Last Closing,
                 the Company shall notify the Subscriber in writing that the
                 final Closing has occurred, the date of the final Closing, the
                 date upon which the 40 day restricted period and the ninety
                 (90) day contractual restricted period will terminate with
                 respect to the Securities, and the value of the fixed strike
                 price, as that term is defined in the Preferred Shares.

8.       Governing Law

         This Agreement shall be governed by and construed in accordance with
the laws of the State of California, U.S.A., applicable to agreements made in
and wholly to be performed in that jurisdiction, except for matters arising
under the Act or the Exchange Act which matters shall be construed and
interpreted in accordance with such laws. Any action brought to enforce, or
otherwise arising out of, this Agreement shall be heard and determined only in
either a federal or state court sitting in the County of Orange in the State of
California, U.S.A.

9.       Entire Agreement; Written Amendments Required

         This Agreement, the Preferred Stock, the Registration Rights Agreement
and the other documents delivered pursuant hereto constitute the full and entire
understanding and agreement between the parties with regard to the subjects
hereof and thereof, and no party shall be liable or bound to any other party in
any manner by any warranties, representations or covenants except as
specifically set forth herein or therein. Except as expressly provided herein,
neither this Agreement nor any term hereof may be amended, waived, discharged or
terminated other than by written instrument signed by the party against whom
enforcement of any such amendment, waiver, discharge or termination is sought.



                                                                              46

<PAGE>   14
10.      Written Notices, Etc.

         Any notice, demand or request required or permitted to be given by
either the Company or the Subscriber pursuant to the terms of this Agreement
shall be in writing and shall be deemed given when delivered personally, or by
facsimile (with a hard copy to follow by two day courier), addressed to the
parties at the addresses and/or facsimile telephone number of the parties set
forth at the end of this Agreement or such other address as a party may request
by notifying the other in writing.

11.      Execution in Counterparts Permitted

         This Agreement may be executed in any number of counterparts, each of
which shall be enforceable against the parties actually executing such
counterparts, and all of which together hall constitute one instrument.

12.      Severability of Agreement

         In the event that any provision of this Agreement becomes or is
declared by a court of competent jurisdiction to be illegal, unenforceable or
void, this Agreement shall continue in full force and effect without said
provision; provided that no such severability shall be effective if it
materially changes the economic benefit of this Agreement to any party.

13.      Titles and Subtitles; Gender

         The titles and subtitles used in this Agreement are used for
convenience only and are not to be considered in construing or interpreting this
Agreement. The use in this Agreement of a masculine, feminine or neither pronoun
shall be deemed to include a reference to the others.

14.      Exact Registered Name of Security Holder; Offshore Delivery
         Instructions

         Subscriber agrees to provide Company with the exact name in which it
wishes the securities to be registered by providing that information on the
accompanying signature page of his Agreement. Additionally, Subscriber also
agrees to provide Company with detailed delivery instructions to an offshore
addressee and will also provide that information on the accompanying signature
page of this Agreement.

15.      Subscriber to Forward Original Signed Subscription Agreement to Company

         Subscriber agrees to courier to Company his, her or its original inked
signed Subscription Agreement within 2 days of faxing said signed agreement to
placement agent, Swartz Investments, Inc.

16.      Assignment.

         Neither party to this Agreement may assign this Agreement without the
written consent of the other (which may be withheld for any reason). This
provision does not limit the Subscriber's right to transfer the Securities
pursuant to the terms of the Preferred Shares and this Agreement.




                                                                              47

<PAGE>   15
[See following page for provisions regarding the amount of your subscription,
the exact name in which the security is to be issued, and offshore delivery
instructions.]

17.      Amount

         The undersigned hereby subscribes for $___________ purchase price 
of Preferred Stock, and pays herewith funds in the amount of ___________ U.S 
Dollars ($___________ U.S.).

         The undersigned acknowledges that this Agreement and the subscription
represented hereby shall not be effective unless accepted by the Company as
indicated below.

Dated this      day of                     , 1995.


<TABLE>
<S>                                                       <C>
- ---------------------------------------------             -----------------------------------------------
Your Signature                                            EXACT NAME IN WHICH YOU WANT
                                                          THE SECURITIES TO BE REGISTERED
                                                          (Please Print Exact Registered Name)

- ---------------------------------------------             OFFSHORE DELIVERY INSTRUCTIONS:
Name:  Please Print

                                                                Please type or print address where your
                                                                security is to be delivered

                                                                ATTN:               
                                                                     ------------------------------------
                                                                                                          
- ---------------------------------------------                   -----------------------------------------
Title/Representative Capacity (if applicable)                   Street Address

                                                                                                          
- ---------------------------------------------                   -----------------------------------------
Name of Company You Represent (if applicable)                   Street Address


- ---------------------------------------------                   -----------------------------------------         
Place of Execution of this Agreement                            City, State or Province, Country

                                                                                                          
                                                                -----------------------------------------
                                                                Offshore Postal Code

                                                                ----------------------------------------- 
                                                                Phone Number (For Federal Express)

                                                                ----------------------------------------- 
                                                                Facsimile Number (re: Notice)

</TABLE>



                                                                              48



<PAGE>   16

         THIS SUBSCRIPTION IS ACCEPTED BY THE COMPANY ON THE     DAY OF       
               1995.

                               TECHNICLONE INTERNATIONAL CORPORATION
                                    A California Corporation

                                  By:                                  
                                     ------------------------------------

                                  Print Name:                          
                                             ----------------------------
                                  Title:                               
                                        ---------------------------------
                                                                                

                                                                              49

<PAGE>   17
                   FIDUCIARY, EXECUTOR OR TRUSTEE CERTIFICATE

         Nature of Signatory. The signatory to this Agreement hereby represents
         and warrants that if he, she or it is a U.S. Person (as defined in
         Regulation S) or is located in the U.S. at the time of signing this
         Agreement, then he, she or it is: 

         a professional fiduciary of Subscriber (as described in Section o(2)
         through (o)(4) of Rule 902 of Regulation S), acting solely mi his
         capacity as holder of such account, in which case:

         (i)     After due inquiry the Subscriber is not a U.S. Person (as
                 defined in Regulation S); and

         (ii)    either (sign either A, B or C, as applicable):

                 A. The account for which the Securities are being purchased by
                 Subscriber is a discretionary account which the undersigned
                 manages and holds for the benefit or account of Subscriber and
                 the Subscriber is not located in the U.S. at the time of
                 signing this Agreement;

                                                                     (signature)
                                              -----------------------

                 OR

                 B. The account for which the Securities are being purchased by
                 Subscriber is the account of an estate of which the undersigned
                 acts as executor, provided that an executor or administrator
                 who is not a U.S. person has sole or shared investment
                 discretion with respect to the assets of the estate, and the
                 estate is governed by foreign law and provided further that the
                 Subscriber is not located in the U.S. at the time of signing
                 this Agreement;

                                                                     (signature)
                                              -----------------------

                 OR

                 C. The account for which the securities are being purchased by
                 Subscriber is the account of a trust of which the undersigned
                 acts as trustee, provided that a trustee who is not a U.S.
                 Person (as defined in Regulation S) 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 (as defined in Regulation S) and
                 provided further that the Subscriber is not located in the U.S.
                 at the time of signing this Agreement.

                                                                     (signature)
                                              -----------------------


- ---------------------------            -----------------------------------------
Print Your Name                        Person or Entity for Whom You are Signing



                                                                              50



<PAGE>   1
            TECHNICLONE INTERNATIONAL: REGISTRATION RIGHTS AGREEMENT

         THIS REGISTRATION RIGHTS AGREEMENT ("Agreement") is entered into as of
December   , 1995, by and among Techniclone International Corporation, a
California corporation ("Company") Swartz Investments, Inc., a Georgia
corporation ("Swartz") and the subscribers ("Investors") to the Company's
offering ("Offering") of up to Ten Million Dollars U.S. ($10,000,000 U.S.) of
Class B Convertible Preferred Stock (the "Preferred Stock") pursuant to
Regulation S.

         WHEREAS, Company desires to provide to Investors the right to obtain
unrestricted and unlegended shares of stock under limited circumstances if
Regulation S were to be deemed invalid or if for any reason Investor is
precluded from removing the Regulation S restrictive legend or converting,
selling or transferring its Preferred Stock after the forty 40 day Regulation S
restricted period, and immediately after the ninety (90) day contractual period
set forth in the Certificate of Determination governing the rights of the
Preferred Stock; and

         WHEREAS, Investors desire the assurance that Company would take the
steps necessary to effectuate a registration in such limited circumstances;

         THEREFORE, the parties
 agree to be bound by the following terms of this
Registration Rights Agreement.

         1.      DEFINITIONS.  For purposes of this Agreement:

                 (a) The term "register", "registered," and "registration"
refers to a registration effected by preparing and filing a registration
statement or similar document in compliance with the Securities Act of 1933 (the
"Act"), and the declaration or ordering of effectiveness of such registration
statement or document;

                 (b) The term "Shares" means the Common Stock of the Company
issuable or issued upon conversion of the Preferred Stock issued to Investors in
the Offering;

                 (c) The number of shares of "Shares Then Outstanding" shall be
determined by the number of shares of Common Stock which have been issued or are
issuable upon conversion of the Preferred Stock or upon exercise of the Warrant
at the time of such determination;

                 (d) The term "Holder" means any person owning or having the
right to acquire Shares or Warrant Shares, or any permitted assignee thereof;

                 (e) The term "Warrant" means the warrant granted to Swartz
Investments in connection with the Offering; and

                 (f) The term "Warrant Shares" means the Common Stock of the
Company issued upon the exercise of the Warrant.

                                 EXHIBIT 4.2



                                                                              51



<PAGE>   2
         2.      REQUEST FOR REGISTRATION.

                 (a) If, Regulation S is deemed to be invalid or if for any
reason Holder is precluded from removing the Regulation S restrictive legend,
converting, selling or transferring its Preferred Stock and which precluded
removal of legend, conversion, sale or transfer would have otherwise been
allowed had Regulation S remained in full force and effect as it was on the date
of the last purchase and sale of Preferred Stock ("Last Closing"), and if such
change in law or the fact that Holder does not meet the requirements of another
exemption precludes Holder from obtaining Shares without the Regulation S
restrictive legend (set forth in Section 4.1(a) of the Subscription Agreement)
after the forty 40 day Regulation S restricted period, and if, at any time after
ninety 90 days after the Last Closing, the Company shall receive written
request(s) from the Holders of Shares obtained or obtainable upon conversion of
at least $1,000,000 of Preferred Stock (the "Initiating Holders"), for the
Company to file a registration statement under the Act covering the registration
of at least twenty percent (20%) of the number of Shares and Warrant Shares then
outstanding, then the Company shall, within ten (10) days of the receipt
thereof, give written notice of such request to all Holders and shall, subject
to the limitations of subsection 2(b), effect as soon as practicable, and in any
event within seventy-five 75 days of the receipt of such request, the
registration under the Act of all Shares and Warrant Shares which the Holders
request, by notice given to the Company within ten (10) days of receipt of the
Company's notice, to be registered as expeditiously as reasonably possible after
the mailing of such notice by the Company (a "Demand Registration").

                 (b) If the Initiating Holders intend to distribute the Shares
covered by their request by means of an underwriting, they shall so advise the
Company as a part of their request made pursuant to this Section 2 and the
Company shall include such information in the written notice referred to in
subsection 2(a). In such event, the right of any Holder to include his Shares
and Warrant Shares in such registration shall be conditioned upon such Holder's
participation in such underwriting and the inclusion of such Holder's Shares and
Warrant Shares in the underwriting (unless otherwise mutually agreed by a
majority in interest of the Initiating Holders and such Holder) to the extent
provided herein. All Holders proposing to distribute their securities through
such underwriting shall (together with the Company as provided in subsection
5(f)) enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by a majority in
interest of the Initiating Holders, and reasonably acceptable to the Company.

                 (c) The Company is obligated to effect only one Demand
Registration pursuant to Section 2 of this Agreement. Company agrees to include
all Shares and Warrant Shares held by all Holders (that are initiating Holders
or have notified the Company of their desire to be included in the registration
statement pursuant to 2(a) above) in such registration statement without cutback
or reduction. In the event the Company breaches its obligation of the preceding
sentences, any Holders of the Shares and Warrant Shares which were not included
in such registration statement shall be entitled to a second Demand Registration
for such excluded securities and shall keep the registration statement effective
as required by Section 5.

                 (d) If in the opinion of the Company's counsel registration
under the Act is not required, then the Company is not obligated to effect a
demand registration under this Section 2 unless the Initiating Holders engage
(1) at Company's sole expense, outside counsel, whose reputation and fee
structure shall be reasonably acceptable to Company, or (2) at their own
expense,



                                                                              52



<PAGE>   3
outside counsel, whose reputation is reasonably acceptable to Company, who
opines that registration under the Act is required (i.e. there are no exemptions
from registration under the Act which are available to the Holders of the
Shares) for the immediate transfer of the Shares. Based on opinion of outside
counsel, Company shall begin the registration of the Shares in accordance with
Section 1(a) of this Agreement.

         3.      COMPANY REGISTRATION. If (but without any obligation to do so) 
the Company proposes to register (including for this purpose a registration
effected by the Company for shareholders other than the Holders) any of its
Common Stock under the Act in connection with the public offering of such
securities solely for cash (other than a registration relating solely to the
sale of securities to participants in a Company stock plan or a registration on
Form S-4 promulgated under the Act or any successor or similar form registering
stock issuable upon a reclassification, upon a business combination involving an
exchange of securities or upon an exchange offer for securities of the issuer or
another entity), the Company shall, at such time, promptly give each Holder
written notice of such registration. Upon the written request of each Holder
given by fax within twenty (20) days after mailing of such notice by the
Company, which request shall state the intended method of disposition of such
Shares by such Holder, the Company shall cause to be registered under the Act
all of the Shares and Warrant Shares that each such Holder has requested to be
registered (a "Piggyback Registration").

         4.      LIMITATION ON OBLIGATIONS TO REGISTER.

                 In the case of a Piggyback Registration in an underwritten
public offering by the Company, if the managing underwriter determines and
advises in writing that the Shares and Warrant Shares to be included in such
offering would interfere with the successful marketing of the securities
proposed to be registered by the Company, then the number of such Shares and
Warrant Shares to be included in the registration statement shall be allocated
among all Holders who had requested Piggyback Registration, in the proportion
that the number of Shares and Warrant Shares which each such Holder [including
Swartz Investments] seeks to register bears to the total number of Shares and
Warrant Shares sought to be included by all Holders [including Swartz
Investments].

         5.      OBLIGATIONS OF THE COMPANY. Whenever required under this 
Agreement to effect the registration of any Shares and Warrant Shares the 
Company shall, as expeditiously as reasonably possible:

                 (a) Prepare and file with the SEC a registration statement with
respect to such Shares and Warrant Shares and use its most reasonable business
efforts to cause such registration statement to become effective.

                 (b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Act with respect to the disposition of all securities covered
by such registration statement.

                 (c) Use best efforts to keep such registration statement
effective for a period of at least two hundred seventy 270 days.



                                                                              53


<PAGE>   4
                 (d) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as they may reasonably request
in order to facilitate the disposition of Shares owned by them.

                 (e) Use its most reasonable business efforts to register and
qualify the Shares and Warrant Shares covered by such registration statement
under such other securities or Blue Sky laws of such jurisdictions as shall be
reasonably requested by the Holders of the Shares and Warrant Shares covered by
such registration statement, provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do business or to
file a general consent to service of process in any such states or
jurisdictions.

                 (f) In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.

                 (g) At any time when a prospectus relating thereto is required
to be delivered under the Act, notify each Holder of Shares and Warrant Shares
covered by such registration statement of the happening of any event, the result
of which event, would cause the prospectus included in such registration
statement, as then in effect, to include 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.

                 (h) At the request of any Holder requesting registration of
Shares and Warrant Shares pursuant to this Agreement, on the date that such
Shares and Warrant Shares are delivered to the underwriters for sale in
connection with a registration pursuant to this Agreement, if such securities
are being sold through underwriters, or, if such securities are not being sold
through underwriters, on the date that the registration statement with respect
to such securities becomes effective, (i) in the event of any underwritten
public offering, furnish an opinion, dated such date, of the counsel
representing the Company for the purposes of such registration, in form and
substance as is customarily given to underwriters in an underwritten public
offering, addressed to the underwriters, if any, and to the Holders requesting
registration of Shares and Warrant Shares; and, in the event of a public
offering without an underwriter, an opinion, dated such date, of the counsel
representing the Company for the purposes of such registration, to the effect
that the registration statement has been declared effective, the Shares and
Warrant Shares of the applicable Holders have been included, and such Holders
may sell the Shares and Warrant Shares so covered by the registration statement
(ii) in the event of any underwritten public offering, a letter dated such date,
from the independent certified public accountants of the Company, in form and
substance as is customarily given by independent certified public accountants to
underwriters in an underwritten public offering, addressed to the underwriters
and to the Holders requesting registration of Shares and Warrant Shares.

                 (i) Company shall be obligated to allow a Holder the right to
conduct at Holder's expense a reasonable due diligence inquiry in connection
with any offering conducted pursuant to this Agreement, Company further agrees
to provide to Holder copies of the registration statement prior to its filing
with the SEC.



                                                                              54

<PAGE>   5
       6.        FURNISH INFORMATION. It shall be a condition precedent to
the obligations of the Company to take any action pursuant to this Agreement
that the selling Holders shall furnish to the Company such information regarding
themselves, the Shares or Warrant Shares held by them, and the intended method
of disposition of such securities as shall be required to effect the
registration of their Shares or Warrant Shares or to determine that registration
is not required pursuant to Regulation S, or other applicable provisions of the
Act.

         7.      EXPENSES OF DEMAND REGISTRATION. All expenses other than
underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications pursuant to Section 2, including
(without limitation) all registration, filing and qualification fees, printers'
and accounting fees, fees and disbursements of counsel for the Company and
including the reasonable fees and disbursements incurred of only one counsel (up
to a maximum of $5,000 for such counsel fees and disbursements), for the selling
Holders, shall be borne by the Company; provided, however, that the Company
shall not be required to pay for any expenses of any registration proceeding
begun pursuant to Section 2 if the registration request is subsequently
withdrawn at the request of the Holders of a majority of the Shares and Warrant
Shares to be registered (in which case all Holders who had requested such
registration shall bear such expenses); provided further, however, that if at
the time of such withdrawal, the Holders have learned of a material adverse
change in the condition, business, or prospects of the Company from that known
to the Holders at the time of their request, then the Holders shall not be
required to pay any of such expenses and shall retain their rights pursuant to
Section 2.

         8.      EXPENSES OF COMPANY REGISTRATION. The Company shall bear and
pay all expenses incurred in connection with any registration, filing or
qualification of Shares and Warrant Shares with respect to the registrations
pursuant to Section 3 for each Holder, including (without limitation) all
registration fees, filing and qualification fees, printing fees and accounting
fees relating or apportionable thereto (and including the reasonable fees and
disbursements incurred of only one counsel for the selling Holders selected by
them, up to a maximum of $5,000 for such counsel fees), but excluding
underwriting discounts and commissions relating to Shares.

         9.      INDEMNIFICATION.  In the event any Shares and Warrant Shares 
are included in a registration statement under this Agreement:

                 (a) To the extent permitted by law, the Company will indemnify
and hold harmless each Holder, the officers and directors of each Holder, any
underwriter (as defined in the Act) for such Holder and each person, if any, who
controls such Holder or underwriter within the meaning of the Act or the
Securities Exchange Act of 1934, as amended (the "1934 Act"), against any
losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Act, the 1934 Act or other federal or state law,
insofar as such losses, claims, damages, or liabilities (or actions in respect
thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "Violation"): (i) any untrue statement
or untrue statement of a material fact contained in such registration statement,
including any preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto, (ii) the omission or alleged omission to
state therein a material fact required to be stated therein, or necessary to
make the statements therein not misleading, or (iii) any violation or violation
by the Company of the Act, the 1934 Act, any state securities law or any rule or
regulation promulgated under the Act, the 1934 Act or any state securities law;
and the Company will reimburse each such Holder, officer or director,
underwriter or controlling person for any legal or other expenses



                                                                              55

<PAGE>   6

reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability, or action; provided, however, that the
indemnity agreement contained in this subsection 9(a) shall not apply to amounts
paid in settlement of any such loss, claim, damage, liability, or action if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld), nor shall the Company be liable in any such case
for any such loss, claim, damage, liability, or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by any such Holder, officer, director, underwriter or
controlling person.

                 (b) To the extent permitted by law, each selling Holder will
indemnify and hold harmless the Company, each of its directors, each of its
officers who have signed the registration statement, each person, if any, who
controls the Company within the meaning of the Act, any underwriter and any
other Holder selling securities in such registration statement or any of its
directors or officers or any person who controls such Holder, against any
losses, claims, damages, or liabilities (joint or several) to which the Company
or any such director, officer, controlling person, or underwriter or controlling
person, or other such Holder or director, officer or controlling person may
become subject, under the Act, the 1934 Act or other federal or state law,
insofar as such losses, claims, damages, or liabilities (or actions in respect
thereto) arise out of or are based upon any Violation, in each case to the
extent (and only to the extent) that such Violation occurs in reliance upon and
in conformity with written information furnished by such Holder expressly for
use in connection with such registration; and each such Holder will reimburse
any legal or other expenses reasonably incurred by the Company and any such
director, officer, controlling person, underwriter or controlling person, other
Holder, officer, director, or controlling person in connection with
investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this subsection
9(b) shall not apply to amounts paid in settlement of any such loss, claim,
damage, liability or action if such settlement is effected without the consent
of the Holder, which consent shall not be unreasonably withheld; provided, that,
in no event shall any indemnity under this subsection 9(b) exceed the gross
proceeds from the offering received by such Holder.

                 (c) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 9, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that all indemnified parties
shall have the right to retain their own counsel, who shall represent all such
indemnified parties and who shall be reasonably acceptable to the indemnifying
party, with the reasonably incurred fees and expenses to be paid by the
indemnifying party, if representation of such indemnified parties by the counsel
retained by the indemnifying party would be inappropriate due to actual or
potential differing interests between any indemnified party and any other party
represented by such counsel in such proceeding. The failure to deliver written
notice to the indemnifying party within a reasonable time of the commencement of
any such action, if prejudicial to its ability to defend such action, shall
relieve such indemnifying party of any liability to the indemnified party under
this Section 9, but the omission so to deliver written notice to the
indemnifying party will not relieve it of any liability that it may have to any
indemnified party otherwise than under this Section 9.



                                                                              56

<PAGE>   7
                 (d) The obligations of the Company and Holders under this
Section 9 shall survive the redemption and conversion, if any, of the Preferred
Stock, the completion of any offering of Shares and Warrant Shares in a
registration statement under this Agreement, and otherwise.

         10.     REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934. With a view
to making available to the Holders the benefits of Rule 144 promulgated under
the Act and any other rule or regulation of the SEC that may at any time permit
a Holder to sell securities of the Company to the public without registration,
the Company agrees to:

                 (a) make and keep public information available, as those terms
are understood and defined in SEC Rule 144;

                 (b) file with the SEC in a timely manner all reports and other
documents required of the Company under the Act and the 1934 Act; and

                 (c) furnish to any Holder, so long as the Holder owns any
Shares, forthwith upon request (i) a written statement by the Company, if true,
that it has complied with the reporting requirements of SEC Rule 144 (at any
time after ninety (90) days after the effective date of the first registration
statement filed by the Company), the Act and the 1934 Act (at any time after it
has become subject to such reporting requirements), (ii) a copy of the most
recent annual or quarterly report of the Company and such other reports and
documents so filed by the Company, and (iii) such other information as may be
reasonably requested in availing any Holder of any rule or regulation of the SEC
which permits the selling of any such securities without registration.

         11.     AMENDMENT OF REGISTRATION RIGHTS. Any provision of this
Agreement may be amended and the observance thereof may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the holders of
a majority of the Shares. Any amendment or waiver effected in accordance with
this paragraph shall be binding upon each Holder, each future Holder, and the
Company.

         12.     MISCELLANEOUS.

                 (a) This Agreement constitutes the entire agreement among the
parties with regard to the subjects hereof. The terms and conditions of this
Agreement shall inure to the benefit of, and be binding upon, the respective
successors and assigns of the parties. Nothing in this Agreement is intended to
confer on any third party any rights, liabilities or obligations, except as
specifically provided.

                 (b) The titles and subtitles used in this Agreement are for
convenience only and are not to be used in construing or interpreting the
Agreement.

         13.      NOTICES. All notices required or permitted under this
Agreement shall be made in writing signed by the party making the same, shall
specify the section under this agreement pursuant to which it is given, and
shall be addressed to (i) The Company Attn: President, 14282 Franklin Avenue
Tustin, CA 92680, Telephone No. (714) 838-0500, Telecopy No. (714) 838-9433, and
(ii) the Holder at their respective last address as the party shall have
furnished in writing as a new address to be entered on such register. Any
notice, except as otherwise provided in this Agreement, shall be made by fax an
shall be deemed given at the time of transmission of such fax.


                                                                              57


<PAGE>   8
         14.       TERMINATION. This Agreement shall terminate on the date
that is three years from the date of this Agreement; but without
prejudice to (i) the parties' rights and obligations arising for breaches of
this Agreement occurring prior to such termination or (ii) other indemnification
obligation under this Agreement.

         15.     ASSIGNMENT. No assignment, transfer or delegation, whether
by operation of law or otherwise, of any rights or obligations under this
Agreement by the Company or any Holder respectively, shall be made without the
prior written consent of the majority in interest of the Holders or the Company,
respectively; provided that the rights of a Holder may be transferred to a
subsequent holder of the Holder's Shares and Warrant Shares (provided such
transferee shall provide to the Company, together with or prior to such
transferee's request to have such Shares and Warrant Share included in a Demand
Registration or Piggyback Registration, a writing executed by such transfers
agreeing to be bound as a Holder by the terms of this Agreement); and provided
further that the Company may transfer its rights and obligations under this
Agreement to a purchaser of all or substantial portion of its business if the
obligations of the Company under this Agreement are assume in connection with
such transfer, either by merger or other operation of law (which may include
without limitation a transaction whereby the Shares and Warrant Shares are
converted into securities of the successor in interest) or by specific
assumption executed by the transferee.

         16.     GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California, U.S.A.
applicable to agreements made in and wholly to be performed in that
jurisdiction, except for matters arising under the Act or the Securities
Exchange Act of 1934, which matters shall be construed and interpreted in
accordance with such laws. Any action brought to enforce, or otherwise arising
out of, this Agreement shall be heard an determined only in either a federal or
state court sitting in the county of Orange in the State of California, U.S.A.

         IN WITNESS WHEREOF, the undersigned have executed this Registration
Rights Agreement as of the date first above written.

         COMPANY                                 INVESTOR(S)

TECHNICLONE INTERNATIONAL
CORPORATION

                                                 -------------------------------
                                                 (Print Investor's Name)

By:                                              By:                       
   ---------------------------------                ----------------------------
         Lon Stone                                           (Signature)
         President and CEO

Address:                                                    Address:

14282 Franklin Avenue                               ----------------------------
Tustin, CA 92640                                    ----------------------------



                                                                              58



<PAGE>   9
Telephone No. (714) 838-0500                        ----------------------------
Telecopy No. (714) 838-9433                         ----------------------------
                                                    Telephone No. (   ) 
                                                                       ---------
                                                    Telecopy No. (   )     
                                                                       ---------



                                                                              59



<PAGE>   1
THIS CERTIFICATE AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAW, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF UNTIL EITHER (I) A REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS SHALL HAVE BECOME EFFECTIVE
WITH REGARD THERETO, OR (II) THE CORPORATION SHALL HAVE RECEIVED AN OPINION OF
COUNSEL ACCEPTABLE TO THE CORPORATION AND ITS COUNSEL THAT AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS IS
AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER.

Warrant to Purchase
________________ shares

                       WARRANT TO PURCHASE COMMON STOCK OF
                      TECHNICLONE INTERNATIONAL CORPORATION

         THIS CERTIFIES that Swartz Investments, Inc. ("Holder") or any
subsequent holder hereof, has the right to purchase from Techniclone
International Corporation, a California Corporation (the "Company"), not more
than _______ fully paid and nonassessable shares of the Company's Common Stock,
no par value ("Common Stock"), at a price of $3.06875 per share subject to
adjustment as provided below (the "Exercise Price"), at any time on or before
5:00
 p.m., Atlanta, Georgia time, on December 28, 2000 ("Warrant").

         The holder of this Warrant agrees with the Company that this Warrant is
issued and all rights hereunder shall be held subject to all of the conditions,
limitations and provisions set forth herein.

         1.      Date of Issuance.

                 This Warrant shall be deemed to be issued on December 18, 1995.

         2.      Exercise.

                 This Warrant may be exercised as to all or any lesser number of
full shares of Common Stock covered hereby upon surrender of this Warrant, with
the Subscription Form attached hereto duly executed, together with the full
Exercise Price (as hereinafter defined) in cash, or by certified or official
bank check payable in California Clearing House Funds for each share of Common
Stock as to which this Warrant is exercised, at the office of the Company,
Techniclone International Corporation, 14282 Franklin Avenue, Tustin, CA 92680,
or at such other office or agency as the Company may designate in writing, by
overnight mail, with an advance copy of the Subscription Form by facsimile (such
surrender and payment hereinafter called the "Exercise of this Warrant"). The
"Date of Exercise" of the Warrant shall be defined as the date that the advance
copy of the Subscription Form is sent by facsimile to the Company, provided that
the original Warrant, Subscription Form, and the Exercise Price are received by
the Company within five (5) business days thereafter. The original Warrant,
Subscription Form, and

                                   EXHIBIT 4.3                                60

<PAGE>   2
the Exercise Price must be received within five (5) business days of the Date of
Exercise, or the Subscription Form shall be considered void. This Warrant shall
be canceled upon its exercise, and, as soon as practical thereafter, the holder
hereof shall be entitled to receive a certificate or certificates for the number
of shares of Common Stock purchased upon such exercise and a new Warrant or
Warrants (containing terms identical to this Warrant) representing any
unexcercised portion of this Warrant. Each person in whose name any certificate
for shares of Common Stock is issued shall, for all purposes, be deemed to have
become the holder of record of such shares on the Date of Exercise of this
Warrant, irrespective of the date of delivery of such certificate. Nothing in
this Warrant shall be construed as conferring upon the holder hereof any rights
as a shareholder of the Company.

         3.      Payment of Warrant Exercise Price.

                 Payment of the Exercise Price may be made by any of the
following, or a combination thereof, at the election of Holder.

                 (i)  cash, certified check or cashiers check or wire transfer;
or

                 (ii) surrender of this Warrant at the principal office of the
Company together with notice of election, in which event the Company shall issue
Holder a number of shares of Common Stock computed using the following formula;

                                  X = Y(A-B)/A

where:           X = the number of shares of Common Stock to be issued to Holder
                 (not to exceed the number of shares set forth on the cover page
                 of this Warrant, as adjusted pursuant to the provisions of
                 Section 4 of this Warrant).

                 Y = the number of shares of Common Stock for which this Warrant
                 is being exercised.

                 A = the Market Price of one share of Common Stock (for purposes
                 of this Section 2(ii), the "Market Price" shall be defined as
                 the average closing bid price of the Common Stock for the five
                 trading days prior to the Date of Exercise of this Warrant (the
                 "Average Closing Bid Price"), as reported by the National
                 Association of Securities Dealers Automated Quotation System
                 ("NASDAQ"), or if the Common Stock is not traded on NASDAQ, the
                 Average Closing Bid Price in the over-the-counter market;
                 provided, however, that if the Common Stock is listed on a
                 stock exchange, the Market Price shall be the Average Closing
                 Bid Price on such exchange). If actual sales price information
                 is not available on any such trading day, then the Closing Bid
                 Price on that such date will be the Closing Bid Price on the
                 last reported date.

                 B = The Exercise Price, $3.06875 per share (subject to
                 adjustment).

It is intended that the Common Stock issuable upon exercise of this Warrant in a
cashless exercise transaction shall be deemed to have been acquired at the time
this Warrant was issued, for purposes of Rule 144(d)(3)(ii).

                                                                              61

<PAGE>   3
         4.      Transfer and Registration.

                 Subject to the provisions of Section 7 of this Warrant, this
Warrant may be transferred on the books of the Company, wholly or in part, in
person or by attorney, upon surrender of this Warrant properly endorsed, with
signature guaranteed. This Warrant shall be canceled upon such surrender and, as
soon as practicable thereafter, the person to whom such transfer is made shall
be entitled to receive a new Warrant or Warrants as to the portion of this
Warrant transferred, and the holder of this Warrant shall be entitled to receive
a new Warrant or Warrants as to the portion hereof retained. The Common Stock
issuable upon the exercise of this Warrant constitute "Warrant Shares" under
that certain Registration Rights Agreement dated December ___ between the
Company and certain investors and, accordingly, has the benefit of the
registration rights pursuant to that agreement.

         5.      Anti-Dilution Adjustments.

         (a)     If the Company shall at any time declare a dividend payable in
shares of Common Stock, then the holder hereof, upon exercise of this Warrant
after the record date for the determination of holders of Common Stock entitled
to receive such dividend, shall be entitled to receive upon Exercise of this
Warrant, in addition to the number of shares of Common Stock as to which this
Warrant is exercised, such additional shares of Common Stock as such holder
would have received had this Warrant been exercised immediately prior to such
record date.

         (b)     If the Company shall at any time effect a recapitalization or
reclassification of such character that the shares of Common Stock shall be
changed into or become exchangeable for a larger or smaller number of shares,
then upon the effective date thereof, the number of shares of Common Stock which
the holder hereof shall be entitled to purchase upon Exercise of this Warrant
shall be increased or decreased, as the case may be, in direct proportion to the
increase or decrease in the number of shares of Common Stock by reason of such
recapitalization or reclassification, and the Exercise Price shall be, in the
case of an increase in the number of shares, proportionately decreased and, in
the case of a decrease in the number of shares, proportionally increased.

         (c)     If the Company shall at any time distribute to holders of 
Common Stock cash, evidences of indebtedness or other securities or assets
(other than cash dividends or distributions payable out of earned surplus or net
profits for the current or preceding year) then, in any such case, the holder of
this Warrant shall be entitled to receive, upon exercise of this Warrant, with
respect to each share of Common Stock issuable upon such exercise, the amount of
cash or evidences of indebtedness or other securities or assets which such
holder would have been entitled to receive with respect to each such share of
Common Stock as a result of the happening of such event had this Warrant been
exercised immediately prior to the record date or other date fixing shareholders
to be affected by such event (the "Determination Date") or, in lieu thereof, if
the Board of Directors of the Company should so determine at the time of such
distribution, a reduced Exercise Price determined by multiplying the Exercise
Price on the Determination Date by a fraction, the numerator of which is the
result of such Exercise Price reduced by the value of such distribution
applicable to one share of Common Stock (such value to be determined by the
Board in its discretion) and the denominator of which is such Exercise Price.

                                                                              62

<PAGE>   4
         (d)     If the Company shall at any time consolidate or merge with any
other corporation or transfer all or substantially all of its assets, then the
Company shall deliver written notice to the Holder of such merger, consolidation
or sale of assets at least thirty (30) days prior to the closing of such merger,
consolidation or sale of assets and this Warrant shall terminate and expire
immediately prior to the closing of such merger, consolidation or sale of
assets.

         (e)     As used in this Warrant, the term "Exercise Price" shall mean
the purchase price per share specified in this Warrant until the occurrence of
an event stated in subsection (b) or (c) of this Section 4 and thereafter shall
mean said price as adjusted from time to time in accordance with the provisions
of said subsection. No such adjustment shall be made unless such adjustment
would change the Exercise Price at the time by $.01 or more; provided, however,
that all adjustments not so made shall be deferred and made when the aggregate
thereof would change the Exercise Price at the time by $.01 or more. No
adjustment made pursuant to any provision of this Section 4 shall have the
effect of increasing the total consideration payable upon Exercise of this
Warrant in respect of all the Common Stock as to which this Warrant may be
exercised.

         (f)     In the event that at any time, as a result of an adjustment
made pursuant to this Section 4, the holder of this Warrant shall, upon Exercise
of this Warrant, become entitled to receive shares and/or other securities or
assets (other than Common Stock) then, wherever appropriate, all references
herein to shares of Common Stock shall be deemed to refer to and include such
shares and/or other securities or assets; and thereafter the number of such
shares and/or other securities or assets shall be subject to adjustment from
time to time in a manner and upon terms as nearly equivalent as practicable to
the provisions of this Section 4.

         6.      Fractional Interests.

                 No fractional shares or scrip representing fractional shares
shall be issuable upon the Exercise of this Warrant, but on Exercise of this
Warrant, the holder hereof may purchase only a whole number of shares of Common
Stock. The Company shall make a payment in cash in respect of any fractional
shares which might otherwise be issuable upon Exercise of this Warrant,
calculated by multiplying the fractional share amount by the market price of the
Company's Common Stock on the Date of Exercise as reported by the NASDAQ
National Market or such other exchange as Company's Common Stock is traded on in
accordance with provision 3.

         7.      Reservation of Shares.

                 The Company shall at all times reserve for issuance such number
of authorized and unissued shares of Common Stock (or other securities
substituted therefor as herein above provided) as shall be sufficient for
Exercise of this Warrant. The Company covenants and agrees that upon Exercise of
this Warrant, all shares of Common Stock issuable upon such Exercise shall be
duly and validly issued, fully paid, nonassessable and not subject to preemptive
rights of any shareholders.

         8.      Restrictions on Transfer.

                 This Warrant and the Common Stock issuable on Exercise hereof
have not been registered under the Securities Act of 1933, as amended, and may
not be sold, transferred,

                                                                              63

<PAGE>   5
pledged, hypothecated or otherwise disposed of in the absence of registration or
the availability of an exemption from registration under said Act, and, in the
event a holder believes an exemption from the registration requirements of the
Act is available, the holder must deliver a legal opinion satisfactory in form
and substance, to the Issuer and its counsel, stating that such exemption is
available. All shares of Common Stock issued upon Exercise of this Warrant shall
bear an appropriate legend to such effect.

         9.      Benefits of this Warrant.

                 Nothing in this Warrant shall be construed to confer upon any
person other than the Company and the holder of this Warrant any legal or
equitable right, remedy or claim under this Warrant and this Warrant shall be
for the sole and exclusive benefit of the Company and the holder of this
Warrant.

         10.     Applicable Law.

                 This Warrant is issued under and shall for all purposes be
governed by and construed in accordance with the laws of the state of Georgia.
Jurisdiction for any dispute regarding this Warrant lies in North Fulton County,
Georgia.

         11.     Loss of Warrant.

                 Upon receipt by the Company of evidence of loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of indemnity or security reasonably satisfactory to the Company,
and upon surrender and cancellation of this Warrant, if mutilated, the Company
shall execute and deliver a new Warrant of like tenor and date.

         12.     Notice to Company.

                 Notices or demands pursuant to this Warrant to be given or made
by the holder of this Warrant to or on the Company shall be sufficiently given
or made if sent by certified or registered mail, return receipt requested,
postage prepaid, and addressed, until another address is designated in writing
by the Company, Techniclone International Corporation, 14282 Franklin Avenue,
Tustin, CA 92680 (714) 838-0500, Attention: Chief Executive Officer. Notices or
demands pursuant to this Warrant to be given or made by the Company to or on the
holder of this Warrant shall be sufficiently given or made if sent by certified
or registered mail, return receipt requested, postage prepaid, and addressed,
Attn: Mr. Eric Swartz, Swartz Investments, Inc., 200 Roswell Summit, Suite 285,
1080 Holcomb Bridge Road, Roswell, GA 30076.

                                                                              64

<PAGE>   6
         IN WITNESS WHEREOF, this Warrant is hereby executed effective as of the
date set forth below.

Dated as of:  December ___, 1995  TECHNICLONE INTERNATIONAL CORPORATION

                                           By: ________________________________
                                           Print Name: ________________________
                                           Title: _____________________________

                                                                              65

<PAGE>   7
                                SUBSCRIPTION FORM

                    TO: TECHNICLONE INTERNATIONAL CORPORATION

         The undersigned hereby irrevocably exercises the right to purchase
___________ of the shares of Common Stock of Techniclone International
Corporation, a California corporation, evidenced by the attached Warrant, and
herewith makes payment of the Exercise Price with respect to such shares in
full, all in accordance with the conditions and provisions of said Warrant.

         The undersigned agrees not to offer, sell, transfer or otherwise
dispose of any of such Common Stock, except in accordance with the provisions of
Section 7 of the Warrant, and consents that the following legend may be affixed
to the certificates for the Common Stock hereby subscribed for, if such legend
is applicable:

         "The securities represented by this certificate have not been
         registered under the Securities Act of 1933, as amended (the
         "Securities Act"), or any state securities law, and may not be sold,
         transferred, pledged, hypothecated or otherwise disposed of until
         either (i) a registration statement under the Securities Act and
         applicable state securities laws shall have become effective with
         regard thereto, or (ii) the corporation shall have received an opinion
         of counsel acceptable to the corporation and its counsel that an
         exemption from registration under the Securities Act or applicable
         state securities laws is available in connection with such offer, sale
         or transfer."

         The undersigned requests that certificates for such shares be issued,
and a warrant representing any unexercised portion thereof be issued, pursuant
to the Warrant in the name of the Registered Holder and delivered to the
undersigned at the address set forth below:

Dated:


________________________________________________________________________________
                         Signature of Registered Holder


________________________________________________________________________________
                        Name of Registered Holder (Print)


________________________________________________________________________________
                                     Address

The attached Warrant and the securities issuable on exercise thereof have not
been registered under the Securities Act of 1933, as amended, and may not be
sold, transferred, pledged, hypothecated or otherwise disposed of in the absence
of registration or the availability of an exemption from registration under said
Act.
________________________________________________________________________________

                                                                              66

<PAGE>   8
                                   ASSIGNMENT

                    (To be executed by the registered holder
                        desiring to transfer the Warrant)

FOR VALUE RECEIVED, the undersigned holder of the attached Warrant hereby sells,
assigns and transfers unto the person or persons below named the right to
purchase ______ shares of the Common Stock of TECHNICLONE INTERNATIONAL
CORPORATION evidenced by the attached Warrant and does hereby irrevocably
constitute and appoint _________________ attorney to transfer the said Warrant
on the books of the Company, with full power of substitution in the premises.

Dated:                                             ____________________________
                                                   Signature

Fill in for new Registration of Warrant:


____________________________________________
                 Name


____________________________________________
                Address

                                                   
____________________________________________
Please print name and address of assignee
(including zip code number)

________________________________________________________________________________

NOTICE

The signature to the foregoing Subscription Form or Assignment must correspond
to the name as written upon the face of the attached Warrant in every
particular, without alteration or enlargement or any change whatsoever.

                                                                              67



<PAGE>   1
                                   SUMMARY:   TECHNICLONE INTERNATIONAL
                                              CORPORATION ANNOUNCES THAT IT HAS
                                              RAISED $8.2 MILLION WITH SALE OF
                                              8,200 SHARES OF ITS PREFERRED
                                              STOCK

contact:  Trudy M. Self (818) 880-5437      or     Lon H. Stone
          Self & Associates or                     Chairman & CEO, Techniclone
          Ellen Friedberg (310) 286-2741           (714) 838-0500



         Tustin, Calif., December 29, 1995--Techniclone International
Corporation (NNOTC: TCLN) announced today that it has raised approximately
$8,200,000 by selling 8,200 shares of its preferred stock to offshore
institutional investors. The preferred stock is convertible into common stock at
an effective conversion price of $3.069 per share of common stock, or 85% of the
fair market value of the common stock at the time of conversion, whichever is
lower. The sale of the preferred stock was arranged by Swartz Investments, Inc.
of Roswell, Georgia.

         TCLN intends to use the proceeds from the offering to support its
Oncolym(TM) manufacturing effort for the final Oncolym(TM) clinical trials, to
fund additional development of its patented tumor necrosis technologies (TNT)
and for working capital.

         The Company believes that the additional capital resulting from this
offering will be sufficient to support the Company's relisting on NASDAQ. TCLN
plans
 to apply for relisting on NASDAQ early in 1996.

         TCLN intends to seek approval from the U.S. FDA to commence clinical
trials for TNT in 1996. TNT is a broad spectrum antibody with the ability to
enhance tumor dosing or targeting across a wide spectrum of solid tumor types,
including lung, colon, breast, prostate and pancreatic cancers, without
affecting adjacent healthy tissue. Techniclone believes that the potential to
treat cancer without injuring surrounding healthy tissue may reduce both the
cost and adverse side effects of conventional cancer therapy.

         TCLN, located in Tustin, California, was established in 1982 to
discover and develop innovative antibodies technologies. The primary programs at
TCLN are directed toward the development of monoclonal antibodies for the
treatment of cancer.

                                 EXHIBIT 99.1                                 68