<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 25, 1997
REGISTRATION NO. 333-23211
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
SHAMAN PHARMACEUTICALS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 2834 94-3095806
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
</TABLE>
213 EAST GRAND AVENUE
SOUTH SAN FRANCISCO, CALIFORNIA 94080
(415) 952-7070
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF THE
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
LISA A. CONTE
PRESIDENT AND CHIEF EXECUTIVE OFFICER
SHAMAN PHARMACEUTICALS, INC.
213 EAST GRAND AVENUE
SOUTH SAN FRANCISCO, CALIFORNIA 94080
(415) 952-7070
(NAME AND ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA
CODE, OF AGENT FOR SERVICE)
------------------------
COPIES TO:
------------------------
J. STEPHAN DOLEZALEK, ESQ.
BROBECK, PHLEGER & HARRISON LLP
TWO EMBARCADERO PLACE
2200 GENG ROAD
PALO ALTO, CA 94301
(415) 424-0160
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after this Registration Statement becomes effective.
------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
------------------------
CALCULATION OF REGISTRATION FEE
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========================================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED PER SHARE(1) OFFERING PRICE(1) REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------
Common Stock, $0.001 par value per
share............................... 2,000,000 shares $4.6875 $9,375,000 $2,841
========================================================================================================================
</TABLE>
(1) The price of $4.6875 per share, which was the average of the high and low
bid prices of the Common Stock reported by The Nasdaq Stock Market on March
11, 1997, is set forth solely for the purpose of calculating the
registration fee in accordance with Rule 457(c) of the Securities Act of
1933, as amended.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THE REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION ACTING PURSUANT TO SAID SECTION 8(A)
MAY DETERMINE.
================================================================================
<PAGE> 2
PART I
INFORMATION NOT REQUIRED IN PROSPECTUS
The information required in this Part I is contained in Part I of the
Registrant's Statement on Form S-3 (Registration No. 333-23211), as filed with
the Securities and Exchange Commission on March 13, 1997, which is incorporated
herein by reference.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the various expenses expected to be incurred
by the Registrant in connection with the sale and distribution of the securities
being registered hereby. All amounts are estimated except the Securities and
Exchange Commission registration fee and the National Association of Securities
Dealers, Inc. filing fee.
<TABLE>
<S> <C>
SEC registration fee.............................................. $ 2,841
NNM listing fees.................................................. 17,500
Accounting fees and expenses...................................... 25,000
Legal fees and expenses........................................... 75,000
Printing and engraving expenses................................... 12,000
Miscellaneous fees and expenses................................... 67,659
--------
Total........................................................... $200,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law, as amended (the
"DGCL"), provides that a corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal or investigative
(other than an action by or in the right of the corporation) by reason of the
fact that he is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding, if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful.
Section 145 further provides that a corporation similarly may indemnify any such
person serving in any such capacity who was or is a party or is threatened to be
made a party to any threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor, against expenses
actually and reasonably incurred in connection with the defense or settlement of
such action or suit if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the corporation and
except that no indemnification shall be made in respect of any claim, issue or
matter as to which such person shall have been adjudged to be liable to the
corporation unless and only to the extent that the Delaware Court of Chancery or
such other court in which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
Section 102(b)(7) of the DGCL permits a corporation to include in its
certificate of incorporation a provision eliminating or limiting the personal
liability of a director to the corporation or its stockholders for monetary
damages for breach of fiduciary duty as a director, provided that such provision
shall not eliminate
II-1
<PAGE> 3
or limit the liability of a director (i) for any breach of the director's duty
of loyalty to the corporation or its stockholders, (ii) for acts or omissions
not in good faith or which involve intentional misconduct or a knowing violation
of law, (iii) under Section 174 of the DGCL (relating to unlawful payment of
dividends and unlawful stock purchase and redemption) or (iv) for any
transaction from which the director derived an improper personal benefit.
The Registrant's Restated Certificate of Incorporation provides that the
Registrant's directors shall not be liable to the Registrant or its stockholders
for monetary damages for breach of fiduciary duty as a director, except to the
extent that exculpation from liabilities is not permitted under the DGCL as in
effect at the time such liability is determined. The Registrant has entered into
indemnification agreements with all of its officers and directors, as permitted
by the DGCL.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
The exhibits listed in the Exhibit Index as filed as part of this
Registration Statement.
(a) EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------------- ------------------------------------------------------------------------
<S> <C>
1.1* Form of Escrow Agreement.
1.2* Form of Stock Purchase Agreement.
3.1(5) Restated Certificate of Incorporation, as filed with the Delaware
Secretary of State on October 1, 1993.
3.2(8) Amended and Restated By-Laws, as amended May 23, 1996.
4.1(8) Certificate of Designation of Preferences of Series A Preferred Stock of
the Registrant, as filed with the Delaware Secretary of State on July
27, 1996.
5.1** Opinion of Brobeck, Phleger & Harrison LLP.
10.1(1)(11) 1990 Stock Option Plan, as amended.
10.2(1)(11) 1992 Stock Option Plan.
10.3(1)(11) 401(k) Plan.
10.4(1)(11) Form of Stock Purchase Agreement.
10.5(1)(11) Form of Stock Option Agreement.
10.6(1) Form of Confidentiality Agreement-Employees & Consultants.
10.7(1) Form of Confidentiality Agreement-Strategic Planning.
10.8(1) Form of Indemnification Agreement.
10.9(1)(11) Form of Employment Agreement.
10.10(1) Form of Agreement with Scientific Strategy Team Members.
10.11(1) Form of Proprietary Information and Inventions Agreement-Employees.
10.12(1) Form of Proprietary Information and Inventions Agreement-Consultants.
10.13(1) Letter Agreements dated December 8, 1989, May 30, 1990, June 21, 1990,
August 24, 1990 and July 22, 1991, between Shaman and National Institute
of Allergy and Infectious Diseases.
10.14(1)(10) License Agreement dated February 8, 1990, between Shaman and Dr. Michael
Tempesta.
10.15(1)(11) Stock Purchase Agreement dated June 15, 1990, between Shaman and Lisa A.
Conte.
10.16(1) Master Equipment Lease Agreement dated September 28, 1990, between
Shaman and MMC/GATX Partnership No. I, with related schedules.
10.17(1) Series B Preferred Stock Warrants dated September 28, 1990 and June 28,
1991, issued to MMC/GATX Partnership No. I.
10.18(1)(10) License Agreement dated December 5, 1990, as amended January 19, 1992,
between Shaman and the University of British Columbia.
10.19(1) Master Equipment Lease Agreement dated December 26, 1990, between Shaman
and Lease Management Services, Inc.
</TABLE>
II-2
<PAGE> 4
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------------- ------------------------------------------------------------------------
<S> <C>
10.20(1) Master Equipment Lease Agreement dated April 22, 1991, between Shaman
and Industrial Way I Limited Partnership.
10.21(1)(10) Contract Services Agreement dated May 23, 1991, February 1, 1992,
February 4, 1992, September 23, 1992 and October 30, 1992, between
Shaman and New Drug Services, Inc.
10.22(1)(10) License Agreement dated September 25, 1991, between Shaman and Inverni
della Beffa SpA.
10.23(1)(10) Manufacturing Agreement dated September 25, 1991 between Shaman and
Indena SpA.
10.24(1)(10) Master Clinical Trial Agreement dated September 30, 1991 between Shaman
and International Drug Registration, Inc.
10.25(1) Series D Preferred Stock Warrant dated February 3, 1992, issued to
MMC/GATX Partnership No. I.
10.26(1)(10) Supply Agreement dated June 1, 1992.
10.27(1)(10) Supply Agreement dated June 1, 1992.
10.28(2) Screening Agreement dated August 31, 1992, as amended June 2, 1993,
between Shaman and Merck Research Laboratories.
10.29(1)(10) Agreement dated October 16, 1992, between Shaman and International
Medical Technical Consultants, Inc.
10.30(4)(10) Research Agreement dated October 21, 1992, as amended April 27, 1994,
between Shaman and Eli Lilly and Company.
10.31(1) Registration Rights Agreement dated October 22, 1992, as amended
December 14, 1992, between Shaman and certain holders of preferred stock
of Shaman.
10.32(1) Industrial Lease Agreement dated January 1, 1993, between Shaman and
Grand/Roebling Investment Company.
10.33(1) Three Party Agreement dated as of January 1, 1993, by and among Berlex
Laboratories, Inc., Shaman and Grand/Roebling Investment Company.
10.34(2)(10) Letter Agreement dated March 1, 1993, between Shaman and Lederle-Praxis
Biologicals, Division of American Cynamide Corporation.
10.35(3) Contract Service Agreements dated May 10, 1993, between Shaman and R.C.
Benson & Sons, Inc.
10.36(3)(10) Clinical Trial Agreement dated July 21, 1993, between Shaman and the
University of Rochester.
10.37(3)(10) Letter Agreement dated August 24, 1993, between Shaman and University of
Michigan.
10.38(3)(10) Laboratory Services Agreement dated September 1, 1993, between Shaman
and Hazelton Washington, Inc.
10.39(3) Loan and Security Agreement dated September 27, 1993, between Shaman and
Household Commercial of California.
10.40(3) Master Equipment Lease Agreement dated September 30, 1993, between
Shaman and MMC/GATX Partnership No. I, with related schedules.
10.41(3) Common Stock Warrant dated September 30, 1993, issued to MMC/GATX
Partnership No. I.
10.42(3) Common Stock Warrant dated October 5, 1993, issued to Meier Mitchell &
Co.
10.43(5)(10) Joint Research and Product Development Agreement, dated May 24, 1995, by
and between Ono Pharmaceutical Co., Ltd. and Registrant.
10.43(a)(9) Amendment Agreement, dated December 4, 1996, to the Joint Research and
Product Development Agreement by and between Ono Pharmaceutical Co.,
Ltd. and Registrant.
10.44(5)(10) License Agreement, dated June 8, 1995, by and between Bayer AG and
Registrant.
10.45(6)(10) Development Agreement, dated January 11, 1996, by and between Abbott
Laboratories and Registrant.
</TABLE>
II-3
<PAGE> 5
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------------- ------------------------------------------------------------------------
<S> <C>
10.46(6) Loan Agreement, dated October 20, 1995, by and between The Daiwa Bank,
Limited and Registrant.
10.47(6) Assignment and Assumption, dated February 2, 1996, between The Daiwa
Bank, Limited and The Sumitomo Bank, Limited.
10.48(7) Letter dated March 29, 1996 from The Sumitomo Bank, Limited to the
Registrant amending the Loan Agreement dated October 20, 1995.
10.49(8)(10) Subscription Agreement dated July 25, 1996 by and between the Registrant
and Fletcher International Limited.
10.50(9)(10) Joint Research and Product Development and Commercialization Agreement
dated September 23, 1996, by and between Lipha, Lyonnaise Industrielle
Pharmaceutique s.a. and the Registrant.
10.51(9)(10) Stock Purchase Agreement dated September 23, 1996, by and between Lipha,
Lyonnaise Industrielle Pharmaceutique s.a. and the Registrant.
23.1* Consent of Ernst & Young LLP, Independent Auditors.
23.2** Consent of Brobeck, Phleger & Harrison LLP (included in the opinion
filed as Exhibit 5.1).
24.1** Power of Attorney (included in Part II of this Registration Statement
under the caption "Signatures").
</TABLE>
- ---------------
* Filed herewith.
** Previously filed.
(1) Incorporated by reference to exhibits filed with the Registrant's
Registration Statement on Form S-1, File No. 33-55892 which was declared
effective January 26, 1993.
(2) Incorporated by reference to exhibits filed with the Registrant's Quarterly
Report on Form 10-Q for the quarter ended March 31, 1993.
(3) Incorporated by reference to exhibits filed on November 10, 1993 with
Registrant's Registration Statement on Form S-1, File No. 33-71506.
(4) Incorporated by reference to exhibits filed with Registrant's Quarterly
Report on Form 10-Q for the quarter ended March 31, 1994.
(5) Incorporated by reference to exhibits filed with Registrant's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1995, as amended.
(6) Incorporated by reference to exhibits filed with Registrant's Annual Report
on Form 10-K for the year ended December 31, 1995.
(7) Incorporated by reference to exhibits filed with Registrant's Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996.
(8) Incorporated by reference to exhibits filed with Registrant's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1996, as amended.
(9) Incorporated by reference to exhibits filed with Registrant's Quarterly
Report on Form 10-Q for the quarter ended September 30, 1996, as amended.
(10) Confidential treatment has been granted with respect to certain portions of
these agreements.
(11) Management contract or compensation plan.
(b) FINANCIAL STATEMENT SCHEDULES
No financial statement schedules are included because they are not required
or the required information is included in the financial statements or notes
thereto.
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<PAGE> 6
ITEM 17. UNDERTAKINGS.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For purposes of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
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<PAGE> 7
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment to
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of South San Francisco, State of California, on the
24th day of March, 1997.
SHAMAN PHARMACEUTICALS, INC.
By: /s/ LISA A. CONTE
------------------------------------
Lisa A. Conte
President, Chief Executive Officer
and
Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the persons whose signatures
appear below, which persons have signed such Registration Statement in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
NAME TITLE DATE
- ----------------------------------------------- ------------------------------ ---------------
<C> <S> <C>
/s/ LISA A. CONTE Director, President, Chief March 24, 1997
- ----------------------------------------------- Executive Officer and Chief
Lisa A. Conte Financial Officer (Principal
Executive and Financial
Officer)
* Chairman of the Board March 24, 1997
- -----------------------------------------------
G. Kirk Raab
* Director March 24, 1997
- -----------------------------------------------
Herbert H. McDade, Jr.
* Director March 24, 1997
- -----------------------------------------------
M. David Titus
* Director March 24, 1997
- -----------------------------------------------
John A. Young
*By: /s/ LISA A. CONTE
- -----------------------------------------------
Lisa A. Conte
(Attorney-in-fact)
</TABLE>
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<PAGE> 1
EXHIBIT 1.1
ESCROW AGREEMENT
ESCROW AGREEMENT, dated as of March __, 1997, by and between
Shaman Pharmaceuticals, Inc., a Delaware corporation (the "Company"), and U.S.
Trust Company of California, N.A., a national banking institution incorporated
under the laws of the United States of America (the "Escrow Agent").
WHEREAS, the Company proposes to sell an aggregate of
2,000,000 shares of its common stock, par value $0.001 per share (the "Shares"),
as described in the Company's registration statement on Form S-3 (Registration
No. 333-23211) (which, together with all amendments or supplements thereto is
referred to herein as the "Registration Statement");
WHEREAS, the Shares are being offered directly by the Company
to various subscribers, principally institutions, whom the Company has contacted
directly, pursuant to registration under the Securities Act of 1933, as amended,
and pursuant to registration or exemptions from registration under state
securities laws;
WHEREAS, the offering of the Shares will terminate on _______,
1997 (the "Final Closing Date") and, in the event the offering of Shares is not
consummated, all payments made by subscribers will be refunded by the Escrow
Agent with interest earned thereon, if any; and
WHEREAS, with respect to all subscription payments received
from subscribers, the Company proposes to establish an escrow account with the
Escrow Agent at the office of its Escrow Administration, U.S. Trust Company of
California, N.A., 515 South Flower Street, Suite 2700, Los Angeles, California
90071-2291.
NOW, THEREFORE, it is agreed as follows:
1. Establishment of Escrow. The Escrow Agent hereby agrees to
receive and disburse the proceeds from the offering of the Shares and any
interest earned thereon in accordance herewith.
2. Deposit and Investment of Escrowed Property. The Company,
on behalf of the subscribers for the Shares, shall from time to time, but in no
event later than 12:00 noon on the date following the date of receipt by the
Company, cause to be wired to or deposited with, or cause the subscribers for
the Shares to wire or deposit with, the Escrow Agent funds or checks of the
subscribers (the "Escrowed Property") delivered in payment for Shares. Any
checks delivered to the Escrow Agent pursuant to the terms hereof shall be made
payable to the order of the Escrow Agent. Such checks must be (a) delivered to
the Escrow Agent so as to be received not later than two business days before
the Closing; (b) certified; and (c) payable in same or next day funds. The
Escrow Agent upon receipt of such checks shall present such checks for payment
<PAGE> 2
by the drawee-bank under such checks. Any checks not honored by the drawee-bank
thereunder after the first presentment for payment shall be returned to the
Company, on behalf of such subscriber, in the same manner notices are delivered
pursuant to Section 5. Upon receipt of funds or checks from the Company, the
Escrow Agent shall credit such funds and the amount of such checks to Trust #
75570747 (the "Escrow Account") pursuant to Rule 15c2-4 promulgated by the
Securities and Exchange Commission under the Securities Exchange Act of 1934, as
amended. Funds in the Escrow Account shall be invested in Federated Investors
U.S. Treasury Cash Reserves. The Escrow Agent shall in no event be liable for
any loss resulting from any change in interest rates applicable to proceeds
invested pursuant to this Section 2. Interest on proceeds invested pursuant to
this Section shall accrue from the date of investment of such proceeds or, in
the case of checks, from the date on which such check amounts are paid by the
drawee bank, until the termination of such investment pursuant to the terms
hereof and shall be paid as set forth in Section 4.
3. List of Subscribers. The Company shall furnish or cause to
be furnished to the Escrow Agent, at the time of each deposit of funds or checks
pursuant to Section 2, a list, containing the name of, the address of, the
number of Shares subscribed for by, the subscription amount delivered to the
Escrow Agent on behalf of, and the social security or taxpayer identification
number, if applicable, of each subscriber whose funds are being deposited, and
to which is attached a completed W-9 form (or, in the case of any subscriber who
is not a United States citizen or resident, a W-8 form) for each listed
subscriber. The Escrow Agent shall notify the Company of any discrepancy between
the subscription amounts set forth on any list delivered pursuant to this
Section 3 and the subscription amounts received by the Escrow Agent. The Escrow
Agent is authorized to revise such list to reflect the actual subscription
amounts received and the release of any subscription amounts pursuant to Section
4; provided, however, that the Escrow Agent must notify the Company in writing
prior to making any such revisions.
4. Withdrawal of Subscription Amounts. (a) If the Escrow Agent
shall receive a notice, substantially in the form of Exhibit A hereto (an
"Offering Termination Notice"), from the Company, the Escrow Agent shall (i)
promptly after receipt of such Offering Termination Notice and the clearance of
all checks received by the Escrow Agent as Escrowed Property, liquidate any
investments that shall have been made pursuant to Section 2 and send to each
subscriber listed on the list held by the Escrow Agent pursuant to Section 3
whose total subscription amount shall not have been released pursuant to
paragraph (b) or (c) of this Section 4, in the manner set forth in paragraph (e)
of this Section 4, a check to the order of such subscriber in the amount of the
remaining subscription amount held by the Escrow Agent as set forth on such list
held by the Escrow Agent, and (ii) promptly after the fourth business day of the
month, or upon receipt, if later, immediately following the month in which the
investments made pursuant to Section 2 were terminated pursuant to this
paragraph, send, in the manner set forth in paragraph (e) of this Section 4, a
check to the order of each such subscriber in the amount of interest and other
income earned and not yet paid with respect to any investment of such
subscriber's funds. The Escrow Agent shall notify the Company in writing of the
distribution of
2.
<PAGE> 3
such funds to the subscribers.
(b) In the event that (i) the Shares have been subscribed
for and funds in respect thereof shall have been deposited with the Escrow Agent
on or before the Final Closing Date and (ii) no Offering Termination Notice
shall have been delivered to the Escrow Agent. The Company shall deliver to the
Escrow Agent a notice, substantially in the form of Exhibit B hereto (a "Closing
Notice"), designating the date on which Shares are to be sold and delivered to
the subscribers thereof (the "Closing Date"), which date shall not be earlier
than the clearance of any checks received by the Escrow Agent as Escrowed
Property, the proceeds of which are to be distributed on such Closing Date, and
identifying the subscribers and the number of Shares to be sold to each thereon
on such Closing Date, not less than one nor more than three business days prior
to such Closing Date. The Escrow Agent, after receipt of such Closing Notice,
and the Escrowed Property:
(i) on or prior to the Closing Date identified
in such Closing Notice, shall liquidate any investments that shall have been
made pursuant to Section 2 to the extent of the subscription amount to be
distributed pursuant to the immediately succeeding clause (ii);
(ii) on such Closing Date, pay to the Company, in
federal or other immediately available funds and otherwise in the manner and
amounts specified by the Company in such Closing Notice, an amount equal to the
aggregate of the subscription amounts paid by the subscribers identified in such
Closing Notice for the Shares to be sold on such Closing Date as set forth on
the list held by the Escrow Agent pursuant to Section 3; and
(iii) promptly after the fourth business day of
the month immediately following the month in which the investments made pursuant
to Section 2 were terminated pursuant to such Closing Notice, shall send, in the
manner set forth in paragraph (e) of this Section 4, a check to the order of the
Company in the amount of interest and other income earned and not yet paid with
respect to any investment of the Escrowed Property distributed on such Closing
Date.
(c) If at any time and from time to time prior to the
release of any subscriber's total subscription amount pursuant to paragraph (a)
or (b) of this Section 4 from escrow, the Company shall deliver to the Escrow
Agent a notice, substantially in the form of Exhibit C hereto (a "Subscription
Termination Notice"), to the effect that any or all of the subscription of such
subscriber or subscribers have been rejected by the Company (a "Rejected
Subscription"), the Escrow Agent (i) promptly after receipt of such Subscription
Termination Notice and, if such subscriber delivered a check in payment of its
Rejected Subscription, after the clearance of such check, shall liquidate, to
the extent of the sum of such subscriber's Rejected Subscription amount as set
forth in the Subscription Termination Notice, any investments that shall have
been made pursuant to Section 2 and send to such subscriber, in the manner set
forth
3.
<PAGE> 4
in paragraph (e) of this Section 4, a check to the order of such subscriber in
the amount of such Rejected Subscription amount, and (ii) promptly after the
fourth business day of the month, or upon receipt, if later, immediately
following the month in which the investments made pursuant to Section 2 were
terminated pursuant to this paragraph, shall send to such subscriber, in the
manner set forth in paragraph (e) of this Section 4, a check to the order of
such subscriber in the amount of interest and other income earned and not yet
paid with respect to any investment of such subscriber's Rejected Subscription
amount. At the time of such transfer, the Escrow Agent shall identify in
writing to the Company the amount of the interest earned for the account of
each subscriber and the date such subscription was received.
(d) On a date following the transfer of any interest
earned for the account of each subscriber pursuant to Section 4(a) or (c), but
not later than January 31, 1998, the Escrow Agent shall provide each subscriber
with tax form 1099 setting forth the amount of such interest.
(e) For the purpose of this Section 4, any check that the
Escrow Agent shall be required to send to any subscriber shall be sent to such
subscriber by first class mail, postage prepaid, at such subscriber's address
furnished to the Escrow Agent pursuant to Section 3.
5. Notices. Except for any Offering Termination Notice or any
Closing Notice, which may be delivered by facsimile transmission, any notice or
other communication required or permitted to be given hereunder shall be in
writing and shall be (a) delivered by hand or (b) sent by mail, registered or
certified, with proper postage prepaid, and addressed as follows:
If to the Company, to:
Shaman Pharmaceuticals, Inc.
213 East Grand Avenue
South San Francisco, California 94080
Attention: Lisa A. Conte
With a copy to:
Brobeck, Phleger & Harrison LLP
Two Embarcadero Place
2200 Geng Road
Palo Alto, California 94303
Attention: J. Stephan Dolezalek, Esq.
If to the Escrow Agent, to:
U.S. Trust Company of California, N.A.
4.
<PAGE> 5
515 South Flower Street, Suite 2700
Los Angeles, California 90071-2291
Attention: Corporate Trust Department
or to such other address as the person to whom notice is to be given may have
previously furnished to the others in the above-referenced manner. All such
notices and communications, if mailed, shall be effective when deposited in the
mails, except that notices and communications to the Escrow Agent and notices of
changes of address shall not be effective until received.
6. Concerning the Escrow Agent. To induce the Escrow
Agent to act hereunder, it is further agreed by the Company that:
(a) The Escrow Agent shall not be under any duty
to give the Escrowed Property held by it hereunder any greater degree of care
than it gives its own similar property and shall not be required to invest any
funds held hereunder except as directed in this Escrow Agreement. Uninvested
funds held hereunder shall not earn or accrue interest.
(b) This Escrow Agreement expressly sets forth
all the duties of the Escrow Agent with respect to any and all matters pertinent
hereto. No implied duties or obligations shall be read into this Escrow
Agreement against the Escrow Agent. The Escrow Agent shall not be bound by the
provisions of any agreement of the Company except this Escrow Agreement.
(c) The Escrow Agent shall not be liable, except
for its own negligence or willful misconduct, and, except with respect to claims
based upon such negligence or willful misconduct that are successfully asserted
against the Escrow Agent, and the Company shall indemnify and hold harmless the
Escrow Agent (and any successor Escrow Agent) from and against any and all
losses, liabilities, claims, actions, damages and expenses, including reasonable
attorneys' fees and disbursements arising out of and in connection with this
Escrow Agreement other than as a result of the Escrow Agent's negligence or
willful misconduct. Without limiting the foregoing, the Escrow Agent shall in no
event be liable in connection with its investment or reinvestment of any cash
held by it hereunder in good faith, in accordance with the terms hereof,
including without limitation any liability for any delays (not resulting from
gross negligence or willful misconduct) in the investment or reinvestment of the
Escrowed Property, or any loss of interest incident to any such delays.
(d) The Escrow Agent shall be entitled to rely
upon any order, judgment, certification, demand, notice, instrument or other
writing delivered to it hereunder without being required to determine the
authenticity or the correctness of any fact stated therein or the propriety or
validity of the service thereof. The Escrow Agent may act in reliance upon an
instrument or signature believed by it in good faith to be genuine and may
assume, if in good faith, that any person purporting to give notice or receipt
or advice or make any statement or
5.
<PAGE> 6
execute any document in connection with the provisions hereof has been duly
authorized to do so.
(e) The Escrow Agent may act pursuant to the advice of counsel
with respect to any matter relating to this Escrow Agreement and shall not be
liable for any action taken or omitted in good faith and in accordance with such
advice.
(f) The Escrow Agent does not have any interest in the
Escrowed Property deposited hereunder but is serving as escrow holder only. Any
payments of income from the Escrow Account shall be subject to withholding
regulations then in force with respect to United States taxes. The Company will
provide the Escrow Agent with appropriate W-9 forms for tax identification
number certification or nonresident alien certifications.
This paragraph (f) and paragraph (c) of this Section 6 shall survive
notwithstanding any termination of this Escrow Agreement or the resignation of
the Escrow Agent.
(g) The Escrow Agent makes no representation as to the
validity, value, genuineness or the collectibility of any security or other
document or instrument held by or delivered to it.
(h) The Escrow Agent shall not be called upon to advise any
party as to the wisdom of selling or retaining or taking or refraining from any
action with respect to any securities or other property deposited hereunder.
(i) The Escrow Agent (and any successor escrow agent) at any
time may be discharged from its duties and obligations hereunder by the delivery
to it of notice of termination signed by the Company or at any time may resign
by giving written notice to such effect to the Company.
Upon any such termination or resignation, the Escrow Agent shall deliver the
Escrowed Property to any successor escrow agent designated by the Company in
writing, or to any court of competent jurisdiction if no such successor escrow
agent is designated, whereupon the Escrow Agent shall be discharged of and from
any and all further obligations arising in connection with this Escrow
Agreement. The termination or resignation of the Escrow Agent shall take effect
on the earlier of (i) the appointment of a successor (including a court of
competent jurisdiction) or (ii) the day that is 30 days after the date of
delivery (A) to the Escrow Agent of the Company's notice of termination or (B)
to the Company of the Escrow Agent's written notice of resignation. If at that
time the Escrow Agent has not received a designation of a successor escrow
agent, the Escrow Agent's sole responsibility after that time shall be to keep
the Escrowed Property safe until receipt of a designation of successor escrow
agent or a written disposition instruction by the Company or any enforceable
order of a court of competent jurisdiction.
(j) The Escrow Agent shall have no responsibility for the
contents
6.
<PAGE> 7
of any writing of any third party contemplated herein as a means to resolve
disputes and may rely without any liability upon the contents thereof.
(k) In the event of any disagreement among or between the
Company and the subscribers of the Shares resulting in adverse claims or demands
being made in connection with the Escrowed Property, or in the event that the
Escrow Agent in good faith is in doubt as to what action it should take
hereunder, the Escrow Agent shall be entitled to retain the Escrowed Property
until the Escrow Agent shall have received (i) a final and nonappealable order
of a court of competent jurisdiction directing delivery of the Escrowed Property
or (ii) a written agreement executed by the other parties hereto and consented
to by the subscribers directing delivery of the Escrowed Property, in which
event the Escrow Agent shall disburse the Escrowed Property in accordance with
such order or agreement. Any court order referred to in (i) above shall be
accompanied by a legal opinion by counsel for the presenting party satisfactory
to the Escrow Agent to the effect that said court order is final and
nonappealable. The Escrow Agent shall act on such court order and legal opinion
without further question.
(l) As consideration for its agreement to act as Escrow Agent
as herein described, the Company agrees to pay the Escrow Agent fees determined
in accordance with the terms set forth on Exhibit D hereto (made a part of this
Escrow Agreement as if herein set forth). In addition, the Company agrees to
reimburse the Escrow Agent for all reasonable expenses, disbursements and
advances incurred or made by the Escrow Agent in performance of its duties
hereunder (including reasonable fees, expenses and disbursements of its
counsel).
(m) The Company irrevocably (i) submits to the jurisdiction of
any California or federal court sitting in California in any action or
proceeding arising out of or relating to this Escrow Agreement, (ii) agrees that
all claims with respect to such action or proceeding shall be heard and
determined in California or federal court, and (iii) waives, to the fullest
extent possible, the defense of an inconvenient forum. The Company hereby
consents to and grants any such court jurisdiction over the persons of such
party and over the subject matter of any such dispute and agrees that delivery
or mailing of process or other papers in connection with any such action or
proceeding in the manner provided hereinabove, or in such other manner as may be
permitted by law, shall be valid and sufficient service thereof.
(n) Except for this Escrow Agreement, no printed or other
matter in any language (including, without limitation, the Registration
Statement, notices, reports and promotional material) which mentions the Escrow
Agent's name or the rights, powers or duties of the Escrow Agent shall be issued
by the Company or on such party's behalf unless the Escrow Agent shall first
have given its specific written consent thereto. The Escrow Agent hereby
consents to the use of its name and the reference to the escrow arrangement in
the Registration Statement and Prospectus.
7. Miscellaneous.
7.
<PAGE> 8
(a) This Escrow Agreement shall be binding upon and inure
solely to the benefit of the parties hereto and their respective successors and
assigns, heirs, administrators and representatives, and the subscribers of the
Shares and shall not be enforceable by or inure to the benefit of any other
third party except as provided in paragraph (i) of Section 6 with respect to the
termination of, or resignation by, the Escrow Agent. No party may assign any of
its rights or obligations under this Escrow Agreement without the prior written
consent of the other party.
(b) This Escrow Agreement shall be construed in accordance
with and governed by the internal law of the State of California (without
reference to its rules as to conflicts of law).
(c) This Escrow Agreement may only be modified by a writing
signed by all of the parties hereto and consented to by the subscribers of the
Shares adversely affected by such modifications. No waiver hereunder shall be
effective unless in a writing signed by the party to be charged.
(d) This Escrow Agreement shall terminate upon the payment
pursuant to Section 4 of all amounts held in the Escrow Account.
(e) The section headings herein are for convenience only and
shall not affect the construction thereof. Unless otherwise indicated,
references to Sections are to Sections contained herein.
(f) This Escrow Agreement may be executed in one or more
counterparts but all such separate counterparts shall constitute but one and the
same instrument; provided that, although executed in counterparts, the executed
signature pages of each such counterpart may be affixed to a single copy of this
Agreement which shall constitute an original.
IN WITNESS WHEREOF, the parties hereto have caused this Escrow
Agreement to be executed as of the day and year first above written.
U.S TRUST COMPANY OF SHAMAN PHARMACEUTICALS, INC.
CALIFORNIA, N.A.
By __________________________________ By _________________________________
Name: Name: Lisa A. Conte
Title: Title: President, Chief Executive
Officer and Chief Financial
Officer
8.
<PAGE> 9
EXHIBIT A
[Form of Offering Termination Notice]
U.S. Trust Company of California, N.A.
515 South Flower Street, Suite 2700
Los Angeles, California 90071-2291
Attention: ________________
Dear Mr. ________:
Pursuant to Section 4(a) of the Escrow Agreement dated as of
March __, 1997 (the "Escrow Agreement") among Shaman Pharmaceuticals, Inc., a
Delaware corporation (the "Company"), and you, the Company hereby notifies you
of the termination of the offering of the Shares (as that term is defined in the
Escrow Agreement) and directs you to make payments to subscribers as provided
for in Section 4(a) of the Escrow Agreement.
Very truly yours,
SHAMAN PHARMACEUTICALS, INC.
By: __________________________________
Name:
Title:
<PAGE> 10
EXHIBIT B
[Form of Closing Notice]
U.S. Trust Company of California, N.A.
515 South Flower Street, Suite 2700
Los Angeles, California 90071-2291
Attention: ________________
Dear Mr. ________:
Pursuant to Section 4(b) of the Escrow Agreement dated as of
March __, 1997 (the "Escrow Agreement"), among Shaman Pharmaceuticals, Inc., a
Delaware corporation (the "Company"), and you, the Company hereby certifies that
it has received subscriptions for the Shares (as that term is defined in the
Escrow Agreement) and the Company will sell and deliver Shares to the
subscribers thereof at a closing to be held on ________________________, 1997
(the "Closing Date").
Please accept these instructions as standing instructions for
the closing to be held on the Closing Date. The parties hereto certify that they
do not wish a call back regarding these instructions.
We hereby request that the aggregate subscription amount of
$_______________ plus interest earned thereon be paid to us via wire transfer in
accordance with the attached wire instructions.
Very truly yours,
SHAMAN PHARMACEUTICALS, INC.
By: _______________________________
Name:
Title:
B-1
<PAGE> 11
EXHIBIT C
[Form of Subscription Termination Notice]
U.S. Trust Company of California, N.A.
515 South Flower Street, Suite 2700
Los Angeles, California 90071-2291
Attention: ________________
Dear Mr. ________:
Pursuant to Section 4(c) of the Escrow Agreement dated as of
March __, 1997 (the "Escrow Agreement") among Shaman Pharmaceuticals, Inc., a
Delaware corporation (the "Company"), and you, the Company hereby notifies you
that the following subscription(s) have been rejected:
Amount of Dollar
Subscribed Amount of
Name of Shares Rejected
Subscriber Rejected Subscription
---------- -------- ------------
Very truly yours,
SHAMAN PHARMACEUTICALS, INC.
By: _______________________________
Name:
Title:
C-1
<PAGE> 12
EXHIBIT D
U.S. TRUST COMPANY OF CALIFORNIA, N.A.
IMPOUND AGENT FOR
Shaman Pharmaceuticals, Inc.
TRUST # ___________
FEE SCHEDULE
$ ______.__ IMPOUND AGENT FEE
$ ______.__ PER CLOSING DATE EXTENSION
$ ______.__ PER RETURNED SUBSCRIPTION FUNDS
CHECK IF IMPOUND NOT COMPLETED
<PAGE> 1
SHAMAN PHARMACEUTICALS, INC.
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement"), dated as of _________,
is entered into by and between each of the parties who are designated as
Purchasers on the signature page to this Agreement (each, a "Purchaser" and
collectively, the "Purchasers") and Shaman Pharmaceuticals, Inc., a Delaware
corporation (the "Company").
The Company has offered to sell, and each of the Purchasers has agreed
to purchase, the number of shares of the Company's Common Stock, $.001 par
value per share, set forth opposite their names on Schedule I attached hereto
(the "Shares") pursuant to a prospectus dated ____________ (the "Prospectus").
In connection therewith, the Company and each of the Purchasers, severally and
not jointly, hereby agree as follows:
1. Purchase and Sale of Shares. Subject to the terms set forth
herein, the Company agrees to sell the Shares to each of the Purchasers at a
purchase price of $____ per share (the "Purchase Price") and to deliver such
Shares on the Closing Date (as hereinafter defined), and upon the basis of the
representations and warranties, and subject to the terms set forth herein, each
of the Purchasers agrees, severally and not jointly, to purchase the number of
Shares set forth opposite its name on Schedule I attached hereto from the
Company for an amount equal to the Purchase Price multiplied by such number of
Shares set forth in Schedule I (the "Total Purchase Price").
2. Closing. The closing of the purchase and sale of the Shares (the
"Closing") shall take place no later than 4:30 p.m., New York City time, on
________, or at such other time as the Company and the Purchasers may agree
upon in writing (such time and date of the closing being referred to herein as
the "Closing Date").
3. Representations and Warranties of the Company.
3.1 Organization; Good Standing; Qualification. The Company is a
corporation duly organized, validly existing, and in good standing under the
laws of the State of Delaware, has all requisite corporate power and authority
to own and operate its properties and assets and to carry on its business as
now conducted and as proposed to be conducted,, to execute and deliver this
Agreement, to issue and sell the Shares, and to carry out the provisions of
this Agreement.
3.2 Authorization. All corporate action on the part of the
Company, its officers, directors, and stockholders necessary for the
authorization, execution and delivery of this Agreement, the performance of all
obligations of the
<PAGE> 2
Company hereunder and the authorization, issuance (or reservation for issuance),
sale, and delivery of the Shares has been taken or will be taken prior to the
Closing, and this Agreement constitutes the valid and legally binding obligation
of the Company, enforceable in accordance with its terms except (i) as limited
by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws
of general application affecting enforcement of creditors' rights generally, and
(ii) as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies.
3.3 Valid Issuance of Common Stock. The Shares that are being
purchased by the Purchaser hereunder, when issued, sold and delivered in
accordance with the terms of this Agreement for the consideration expressed
herein, will be duly and validly issued, fully paid, and nonassessable, will be
issued in compliance with all applicable federal and state securities laws and
will be free of restriction on transfer other than under applicable state and
federal securities laws.
4. Miscellaneous.
a. This Agreement may be executed in two or more counterparts, and
such counterparts shall constitute one and the same agreement.
b. This Agreement shall inure to the benefit of and be binding
upon the signatories hereto and no other person shall have any right or
obligation hereunder. This Agreement may not be assigned by either party
hereto.
c. This Agreement, together with the schedules hereto, constitutes
the complete agreement between the parties hereto with respect to the subject
matter hereof and may be amended only in a writing which is executed by the
Company and the Purchasers.
d. The Company and the Purchasers agree to cooperate with each
other to deliver such additional documents and instruments and take such
further actions as shall be necessary or appropriate under the terms of this
Agreement to effectuate the transactions contemplated hereby.
5. Governing Law. This Agreement shall be governed by the internal
laws of the State of California, without giving effect to the conflict of laws
principles thereof.
<PAGE> 3
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the date and year first above written.
THE PURCHASERS:
- -----------------------------------
(Name of Entity)
By:
--------------------------------
Title:
-----------------------------
SHAMAN PHARMACEUTICALS, INC.
By:
--------------------------------
Title:
-----------------------------
<PAGE> 1
EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the captions "Selected
Financial Data" and "Experts" in Amendment No. 1 to the Registration Statement
(Form S-3) and related prospectus of Shaman Pharmaceuticals, Inc. for the
registration of 2,000,000 shares of its common stock and to the incorporation by
reference therein of our report dated January 20, 1997, with respect to the
financial statements of Shaman Pharmaceuticals, Inc. included in its Annual
Report (Form 10-K) for the year ended December 31, 1996, filed with the
Securities and Exchange Commission.
ERNST & YOUNG LLP
Palo Alto, California
March 24, 1997
