As Filed with the Securities and Exchange Commission on March 6, 2002
Registration No. 333-82414
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SONUS PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 95-4343413
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
22026 20TH AVENUE S.E., BOTHELL, WASHINGTON 98021
(425) 487-9500
(Address, including zip code, and telephone number, including area code of
registrant's principal executive offices)
RICHARD J. KLEIN
CHIEF FINANCIAL OFFICER
SONUS PHARMACEUTICALS, INC.
22026 20TH AVENUE S.E.
BOTHELL, WASHINGTON 98021
(425) 487-9500
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copy to:
K.C. SCHAAF, ESQ.
CHRISTOPHER D. IVEY, ESQ.
STRADLING YOCCA CARLSON & RAUTH,
A PROFESSIONAL CORPORATION
660 NEWPORT CENTER DRIVE, SUITE 1600
NEWPORT BEACH, CALIFORNIA 92660
Approximate date of commencement of proposed sale to public: FROM TIME
TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
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 any of 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. /X/
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. / /
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 this
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 Securities and Exchange
Commission, acting pursuant to said Section 8(a), may determine.
PROSPECTUS
SONUS PHARMACEUTICALS, INC.
2,489,300 SHARES OF COMMON STOCK
($0.001 PAR VALUE)
This prospectus relates to the offer and sale from time to time of up
to 1,929,000 shares of our outstanding common stock, and up to 560,300 shares of
our common stock issuable upon the exercise of warrants, which are held by
certain stockholders named in this prospectus.
The prices at which such stockholders may sell the shares in this
offering will be determined by the prevailing market price for the shares or in
negotiated transactions. We will not receive any of the proceeds from the sale
of the shares.
Our common stock is traded on The Nasdaq National Market under the
symbol "SNUS." On March 5, 2002, the last reported sale price of our common
stock was $5.30 per share.
SEE "RISK FACTORS" BEGINNING ON PAGE 3 TO READ ABOUT THE RISKS YOU SHOULD
CONSIDER CAREFULLY BEFORE BUYING SHARES OF OUR COMMON STOCK.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is March 6, 2002.
TABLE OF CONTENTS
PAGE
About Sonus Pharmaceuticals............................................... 1
Risk Factors.............................................................. 2
Forward-Looking Statements................................................ 8
Use of Proceeds........................................................... 8
Selling Stockholders...................................................... 9
Plan of Distribution...................................................... 10
Legal Matters............................................................. 12
Experts................................................................... 12
Where You Can Find Additional Information................................. 13
Incorporation by Reference................................................ 13
ABOUT SONUS PHARMACEUTICALS
In this prospectus, the terms "Sonus", the "Company", "we", "us", and
"our" refer to Sonus Pharmaceuticals, Inc.
We are a specialty pharmaceutical company focused on the development of
therapeutic drugs utilizing our proprietary TOCOSOL(TM) drug delivery
technology. The Company's lead product for cancer therapy, TOCOSOL Paclitaxel
(S-8184), is in a Phase I clinical study and has been developed with the goal of
overcoming a number of limitations of the currently marketed paclitaxel
products. Based upon the results of our Phase I study to date, we believe
TOCOSOL Paclitaxel has unique features that may reduce side effects from the
delivery vehicle, allow for a faster administration time and enhance the
efficacy of the active drug, paclitaxel. The Company expects to complete the
Phase I study in mid-2002 and initiate Phase 2 efficacy studies with TOCOSOL
Paclitaxel in early 2002. Sonus is also developing TOCOSOL Amiodarone (S-2646),
a cardiovascular product, and S-9156, an oxygen delivery product.
More comprehensive information about our products and us is available
through our World Wide Web site at www.sonuspharma.com. The information on our
Web site is not incorporated by reference into this prospectus. Our executive
offices are located at 22026 20th Avenue S.E., Bothell, Washington 98021;
telephone (425) 487-9500.
1
RISK FACTORS
Your investment in our common stock involves a high degree of risk. You
should consider the risks described below and the other information contained in
this prospectus and incorporated by reference in this prospectus carefully
before deciding to invest in our common stock. If any of the following risks
actually occur, our business, financial condition and operating results would be
harmed. As a result, the trading price of our common stock could decline, and
you could lose a part or all of your investment.
IF WE FAIL TO DEVELOP PRODUCTS, THEN WE MAY NEVER REALIZE REVENUE FROM
PRODUCT COMMERCIALIZATION.
A key element of our business strategy is to utilize our technologies
for the development and commercialization of drug delivery products. Our drug
delivery technology, TOCOSOL, is a new approach to the formulation of water
insoluble compounds for therapeutic applications. Significant expenditures in
additional research and development, clinical testing, regulatory,
manufacturing, and sales and marketing activities will be necessary in order for
us to demonstrate the efficacy of our products, or commercialize any products
developed with our technology. There can be no assurance that TOCOSOL Paclitaxel
or any of our other current products under development or any future product
will be safe or efficacious.
Even if we are successful in developing our products, there is no
assurance that such products will receive regulatory approval or that a
commercially viable market will develop. While it is our strategy to develop
additional products under our drug delivery technology by entering into
feasibility study agreements with companies who own active compounds, there can
be no assurance that we will enter into any feasibility studies. Moreover, there
can be no assurance that these feasibility studies will result in development or
license agreements. Without feasibility studies or development or license
agreements, we may need to scale back or terminate our efforts to develop other
products using our drug delivery technology.
WE HAVE A HISTORY OF OPERATING LOSSES, AND WE MAY NEVER BECOME
PROFITABLE.
We have experienced significant accumulated losses since our inception,
and are expected to incur net losses for the foreseeable future. These losses
have resulted primarily from expenses associated with our research and
development activities, including nonclinical and clinical trials, and general
and administrative expenses. We reported net income of $542,000 for the year
ended December 31, 2001, incurred a net loss of $2.1 million for the year ended
December 31, 2000 and net income of $435,000 for the year ended December 31,
1999. As of December 31, 2001, our accumulated deficit totaled $28.7 million. We
anticipate that our operating losses will continue as we further invest in
research and development for our products. We will not generate any product
revenues unless and until we receive regulatory approval which will not occur in
the near future. Even if we generate significant product revenues, there can be
no assurance that we will be able to achieve or sustain profitability. Our
results of operations have varied and will continue to vary significantly and
depend on, among other factors:
- The timing and costs of clinical trials and regulatory
approvals;
- Entering into new collaborative or product license agreements;
- The timing of payments, if any, under collaborative partner
agreements; and
2
- Costs related to obtaining, defending and enforcing patents.
GOVERNMENTAL REGULATORY REQUIREMENTS ARE LENGTHY AND EXPENSIVE AND
FAILURE TO OBTAIN NECESSARY APPROVALS WILL PREVENT US OR OUR COLLABORATORS FROM
COMMERCIALIZING A PRODUCT.
We are subject to uncertain governmental regulatory requirements and a
lengthy approval process for our products prior to any commercial sales of our
products. The development and commercial use of our products are regulated by
the U.S. Food and Drug Administration, or FDA, the European Medicines Evaluation
Agency, or EMEA, and comparable regulatory agencies in other countries. The
regulatory approval process for new products is lengthy and expensive. Before we
can file an application with the FDA and comparable international agencies, the
product candidate must undergo extensive testing, including animal studies and
human clinical trials that can take many years and require substantial
expenditures. Data obtained from such testing may be susceptible to varying
interpretations, which could delay, limit or prevent regulatory approval. In
addition, changes in regulatory policy for product approval may cause additional
costs in our efforts to secure necessary approvals.
Our drug delivery products are subject to significant uncertainty
because they are in the early stages of development and are subject to
regulatory approval. We have filed an Investigational New Drug Application, or
IND, with the FDA and initiated a Phase I human clinical study for the first
application of our TOCOSOL Paclitaxel drug delivery technology. We expect to
complete the initial Phase I study with TOCOSOL Paclitaxel in mid-2002 and
initiate Phase 2 studies in early 2002. There can be no assurance that the
clinical studies will demonstrate that TOCOSOL Paclitaxel will be safe or
efficacious or that we will file a new drug application. We are also currently
engaged in pre-clinical testing of a formulation of our TOCOSOL drug delivery
product for cardiovascular treatment and our oxygen delivery product. The
results of pre-clinical and clinical testing of our products are uncertain and
regulatory approval of our products may take longer or be more expensive than
anticipated, which could have a material adverse affect on our business,
financial condition and results of operations. We cannot predict if or when any
of our products under development will be commercialized.
WE DEPEND ON THIRD PARTIES FOR FUNDING, CLINICAL DEVELOPMENT,
MANUFACTURING AND DISTRIBUTION.
We are dependent, or may in the future be dependent, on third parties
for funding or performance of a variety of key activities including research,
clinical development, manufacturing, marketing, sales and distribution of our
products. If we are unable to establish these arrangements with third parties,
if they are terminated or the collaborations are not successful, we will be
required to identify alternative partners to fund or perform research, clinical
development, manufacturing, marketing, sales and/or distribution, which could
have a material adverse effect on our business, financial condition and results
of operations. Our success depends in part upon the performance by these
collaborators of their responsibilities under these arrangements. We have no
control over the resources that any potential partner may devote to the
development and commercialization of products under these collaborations and our
partners may fail to conduct their collaborative activities successfully or in a
timely manner.
FUTURE U.S. OR INTERNATIONAL LEGISLATIVE OR ADMINISTRATIVE ACTIONS ALSO
COULD PREVENT OR DELAY REGULATORY APPROVAL OF OUR PRODUCTS.
3
Even if regulatory approvals are obtained, they may include significant
limitations on the indicated uses for which a product may be marketed. A
marketed product also is subject to continual FDA, EMEA and other regulatory
agency review and regulation. Later discovery of previously unknown problems or
failure to comply with the applicable regulatory requirements may result in
restrictions on the marketing of a product or withdrawal of the product from the
market, as well as possible civil or criminal sanctions. In addition, if
marketing approval is obtained, the FDA, EMEA or other regulatory agency may
require post-marketing testing and surveillance programs to monitor the
product's efficacy and side effects. Results of these post-marketing programs
may prevent or limit the further marketing of a product.
WE WILL NEED ADDITIONAL CAPITAL IN THE FUTURE, AND IF IT IS NOT
AVAILABLE ON TERMS ACCEPTABLE TO US, OR AT ALL, WE MAY NEED TO SCALE BACK OUR
DEVELOPMENT AND COMMERCIALIZATION ACTIVITIES.
Our development efforts to date have consumed and will continue to
require substantial amounts of cash, and we have generated only limited revenues
from payments received from our contractual agreements and from the assignment
of substantially all of our ultrasound contrast intellectual property. Based on
our current operating plan, including planned clinical trials and other product
development costs, we estimate that existing cash and marketable securities,
will be sufficient to meet our cash requirements through 2003. However, we will
need substantial additional capital to complete the development of TOCOSOL
Paclitaxel and to meet our other cash requirements in the future. Our future
capital requirements depend on many factors including:
- Our ability to obtain and retain funding from third parties
under contractual agreements;
- Our progress on research and development programs and clinical
trials;
- The time and costs required to gain regulatory approvals;
- The costs of manufacturing our products;
- The costs of marketing and distributing our products, if
approved;
- The costs of filing, prosecuting and enforcing patents, patent
applications, patent claims and trademarks;
- The status of competing products; and
- The market acceptance and third-party reimbursement of our
products, if approved.
Any future equity financing, if available, may result in substantial
dilution to existing stockholders, and debt financing, if available, may include
restrictive covenants. If we are unable to raise additional financing, we may
have to reduce our expenditures, scale back our development of new products or
license to others products that we otherwise would seek to commercialize
ourselves.
4
THE HEALTHCARE INDUSTRY IS EXTREMELY COMPETITIVE, AND IF WE FAIL TO
COMPETE EFFECTIVELY, IT WOULD NEGATIVELY IMPACT OUR BUSINESS.
The healthcare industry in general is characterized by extensive
research efforts and rapid technological change. Competition in the development
of pharmaceutical products is intense and expected to increase. We also believe
that other medical and pharmaceutical companies will compete with us in the
areas of research and development, acquisition of products and technology
licenses, and the manufacturing and marketing of our products. Success in these
fields will be based primarily on:
- Efficacy;
- Safety;
- Ease of administration;
- Breadth of approved indications; and
- Physician, healthcare payer and patient acceptance.
Several other companies are developing paclitaxel reformulations with a
goal of delivering a more effective and tolerable therapy than the approved
product, Taxol, or its generic equivalents. Companies that have paclitaxel
reformulations in clinical trials include American Biosciences, Inc., Cell
Therapeutics, Inc., Enzon, Inc., NeoPharm, Inc., and Protarga, Inc. Some of
these products are further in development than TOCOSOL Paclitaxel and may
achieve regulatory approval before TOCOSOL Paclitaxel. We expect that
competition will be based on safety, efficacy, ease of administration, breadth
of approved indications, reimbursement, and physician and patient acceptance.
Many of our competitors and potential competitors have substantially
greater financial, technical and human resources than we do and have
substantially greater experience in developing products, obtaining regulatory
approvals and marketing and manufacturing medical products. Accordingly, these
competitors may succeed in obtaining FDA approval for their products more
rapidly than us. In addition, other technologies or products may be developed
that have an entirely different approach that would render our technology and
products noncompetitive or obsolete. If we fail to compete effectively, it would
have a material adverse effect on our business, financial condition and results
of operations.
WE RELY ON THIRD PARTY SUPPLIERS AND MANUFACTURERS TO PRODUCE PRODUCTS
THAT WE DEVELOP AND FAILURE TO RETAIN SUCH SUPPLIERS AND MANUFACTURERS WOULD
ADVERSELY IMPACT OUR ABILITY TO COMMERCIALIZE OUR PRODUCTS.
We currently rely on third parties to supply the chemical ingredients
necessary for our drug delivery and oxygen delivery products. Currently, Indena
is our primary supplier of paclitaxel, the main ingredient in TOCOSOL
Paclitaxel. The chemical ingredients for our products are manufactured by a
limited number of vendors. The inability of these vendors to supply
medical-grade materials to us could delay the manufacturing of, or cause us to
cease the manufacturing of our products. We also rely on third parties to
manufacture our products for research and development and clinical trials. We
currently do not have a commercial manufacturing supplier of TOCOSOL Paclitaxel.
We are engaged in discussions with potential manufacturing partners and our
objective is to enter into a manufacturing supply agreement in 2002. There is no
assurance, however, that we will be successful in entering into any such
relationship. Suppliers and manufacturers of our products must operate under GMP
regulations, as required by the FDA, and there are a limited number of contract
manufacturers that operate under GMP regulations. If we are not able to identify
and qualify contract manufacturers, we may not be able to produce the required
amount of our products for research and development and clinical trials. Failure
to retain qualified suppliers and manufacturers will delay our research and
development efforts as well as the time it takes to commercialize our products,
which could materially adversely affect our business, financial condition and
results of operations.
5
IF WE FAIL TO SECURE ADEQUATE INTELLECTUAL PROPERTY PROTECTION OR
BECOME INVOLVED IN AN INTELLECTUAL PROPERTY DISPUTE, IT COULD SIGNIFICANTLY HARM
OUR FINANCIAL RESULTS AND ABILITY TO COMPETE.
Our success will depend, in part, on our ability to obtain and defend
patents and protect trade secrets. As of February 2002, we had 18 patent
applications filed in the United States pertaining to our TOCOSOL drug delivery
technology as well as counterpart filings in Europe and key countries in Asia
and Latin America. The patent position of medical and pharmaceutical companies
is highly uncertain and involves complex legal and factual questions. There can
be no assurance that any claims which are included in pending or future patent
applications will be issued, that any issued patents will provide us with
competitive advantages or will not be challenged by third parties, or that the
existing or future patents of third parties will not have an adverse effect on
our ability to commercialize our products. Furthermore, there can be no
assurance that other companies will not independently develop similar products,
duplicate any of our products or design around patents that may be issued to us.
Litigation may be necessary to enforce any patents issued to us or to determine
the scope and validity of others' proprietary rights in court or administrative
proceedings. Any litigation or administrative proceeding could result in
substantial costs to us and distraction of our management. An adverse ruling in
any litigation or administrative proceeding could have a material adverse effect
on our business, financial condition and results of operations.
OUR COMMERCIAL SUCCESS WILL DEPEND IN PART ON NOT INFRINGING PATENTS
ISSUED TO COMPETITORS.
There can be no assurance that patents belonging to competitors will
not require us to alter our products or processes, pay licensing fees or cease
development of our current or future products. Any litigation regarding
infringement could result in substantial costs to us and distraction of our
management, and any adverse ruling in any litigation could have a material
adverse effect on our business, financial condition and results of operations.
Further, there can be no assurance that we will be able to license other
technology that we may require at a reasonable cost or at all. Failure by us to
obtain a license to any technology that we may require to commercialize our
products would have a material adverse effect on our business, financial
condition and results of operations. In addition, to determine the priority of
inventions and the ultimate ownership of patents, we may participate in
interference, reissue or re-examination proceedings conducted by the U.S. Patent
and Trademark Office or in proceedings before international agencies with
respect to any of our existing patents or patent applications or any future
patents or applications, any of which could result in loss of ownership of
existing, issued patents, substantial costs to us and distraction of our
management.
THE SUCCESS OF OUR PRODUCTS WILL DEPEND ON THE ACCEPTANCE OF OUR
PRODUCTS BY THIRD PARTY PAYERS.
Our ability to successfully commercialize products that we develop will
depend, in part, upon the extent to which reimbursement of the cost of such
products will be available from domestic and international health administration
authorities, private health insurers and other payer organizations. Third party
payers are increasingly challenging the price of medical and pharmaceutical
products and services or restricting the use of certain procedures in an attempt
to limit costs. Further, significant uncertainty exists as to the reimbursement
status of newly approved healthcare products, and there can be no assurance
that adequate third party coverage will be available.
6
IF WE LOSE OUR KEY PERSONNEL OR ARE UNABLE TO ATTRACT AND RETAIN
QUALIFIED SCIENTIFIC AND MANAGEMENT PERSONNEL, WE MAY BE UNABLE TO BECOME
PROFITABLE.
We are highly dependent on our key executives. The loss of any of these
key executives or the inability to recruit and retain qualified scientific
personnel to perform research and development and qualified management personnel
could have a material adverse effect on our business, financial condition and
results of operations. We do not have employment contracts with any of our key
personnel and we do not maintain insurance policies that would compensate us for
the loss of their services. There can be no assurance that we will be able to
attract and retain such personnel on acceptable terms, if at all, given the
competition for experienced scientists and other personnel among numerous
medical and pharmaceutical companies, universities and research institutions.
FAILURE TO SATISFY NASDAQ NATIONAL MARKET LISTING REQUIREMENTS MAY
RESULT IN OUR STOCK BEING DELISTED FROM THE NASDAQ NATIONAL MARKET.
Our common stock is currently listed on The Nasdaq National Market
under the symbol "SNUS." For continued inclusion on The Nasdaq National Market,
we must maintain among other requirements net tangible assets of at least $4.0
million, a minimum bid price of $1.00 per share, and a market value of our
public float of at least $5.0 million. Effective November 1, 2002, we must
maintain stockholders' equity of at least $10.0 million or market capitalization
of at least $50.0 million for continued inclusion on The Nasdaq National Market.
In the event that we fail to satisfy the listing standards on a continuous
basis, our common stock may be removed from listing on The Nasdaq National
Market. If our common stock is delisted from The Nasdaq National Market, trading
of our common stock, if any, would be conducted in the over-the-counter market
in the so-called "pink sheets" or, if available, the NASD's "Electronic Bulletin
Board." As a result, stockholders could find it more difficult to dispose of, or
to obtain accurate quotations as to the value of, our common stock, and the
trading price per share could be reduced.
THE VALUE OF OUR COMMON STOCK COULD CHANGE SIGNIFICANTLY OVER A SHORT
PERIOD OF TIME.
The market price of our common stock has fluctuated significantly. In
the first quarter of 2001, the price of our common stock closed as high as $2.84
per share and as low as $.58 per share. In the second quarter of 2001, the price
of our common stock closed as high as $3.68 per share and as low as $.94 per
share. In the third quarter of 2001, the price of our common stock closed as
high as $4.50 per share and as low as $2.85 per share. In the fourth quarter of
2001, our common stock closed as high as $8.31 per share and as low as $3.75 per
share. The market price of our common stock may continue to fluctuate
significantly and these fluctuations may be unrelated to operating performance.
Announcements by us or our perceived competitors concerning clinical
trial results, technological innovations, new products, proposed governmental
regulations or actions, developments or disputes relating to patents or other
proprietary rights, and other factors that affect the market generally could
significantly impact our business and the market price of our common stock.
7
FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference into this
prospectus contain forward-looking statements that are based on current
expectations, estimates and projections about our industry, management's
beliefs, and assumptions made by management. Words such as "anticipates,"
"expects," "intends," "plans," "believes," "seeks," "estimates," and variations
of such words and similar expressions are intended to identify such
forward-looking statements. These statements are not guarantees of future
performance and are subject to certain risks, uncertainties and assumptions that
are difficult to predict; therefore, actual results may differ materially from
those expressed or forecasted in any forward-looking statements. The risks and
uncertainties include those noted in "Risk Factors" above and in the documents
incorporated by reference. We undertake no duty to update any of these
forward-looking statements.
USE OF PROCEEDS
The proceeds from the sale of each selling stockholder's common stock
will belong to that selling stockholder. We will not receive any proceeds from
such sales.
8
SELLING STOCKHOLDERS
We issued 1,929,000 shares of common stock and warrants to purchase an
additional 385,800 shares of common stock on January 18, 2002 in a private
placement to certain stockholders set forth below. Pursuant to a Registration
Rights Agreement dated January 18, 2002, we agreed to file a registration
statement of which this prospectus is a part with the Securities and Exchange
Commission to register the resale of the shares of our common stock we issued,
and which we will issue upon exercise of warrants, to those stockholders and to
keep the registration statement effective until either the shares registered
hereunder are sold or the shares registered hereunder can be sold without
registration and without restriction. The registration statement of which this
prospectus is a part also registers for resale up to 174,500 shares of our
common stock issuable upon the exercise of warrants issued on June 15, 2001
pursuant to registration rights granted to the holders of such warrants. None of
the selling stockholders have any position, office or material relationship with
the Company.
The following table sets forth: (1) the name of each of the selling
stockholders for whom we are registering the resale of shares under this
registration statement; (2) the number of shares of our common stock owned by
each such selling stockholder prior to this offering; (3) the number of shares
of our common stock being offered pursuant to this prospectus; and (4) the
number of shares, and (if one percent or more) the percentage of the total of
the outstanding shares, of our common stock to be owned by each such selling
stockholder after this offering.
PERCENTAGE OF
COMMON STOCK COMMON STOCK COMMON STOCK
COMMON STOCK BEING OFFERED OWNED UPON OWNED UPON
OWNED PRIOR TO PURSUANT TO COMPLETION OF COMPLETION OF
NAME THE OFFERING THIS PROSPECTUS THIS OFFERING THIS OFFERING
---- ------------ --------------- ------------- -------------
S.A.C. Capital Associates, 662,851 662,851 0 0
LLC (1)
S.A.C. Healthco Fund, LLC (2) 662,851 662,851 0 0
Narragansett Offshore, Ltd. 209,640 209,640 0 0
(3)
Leaf Investment Partners L.P. 170,213 170,213 0 0
(4)
Welch Life Sciences Fund, LP 123,888 123,888 0 0
(5)
Welch Entrepreneurial Fund, 106,942 106,942 0 0
LP (6)
Yale University (7) 102,127 102,127 0 0
Narragansett I, LP (8) 94,186 94,186 0 0
Evolution Capital, Inc. (9) 87,250 87,250 0 0
9
Domain Public Equity Partners 85,106 85,106 0 0
L.P. (10)
Wayne P. Rothbaum (9) 43,625 43,625 0 0
Mitchell D. Silber (9) 43,625 43,625 0 0
Welch Entrepreneurial Fund, 40,224 40,224 0 0
Ltd. (11)
Welch Life Sciences Fund, 32,772 32,772 0 0
Ltd. (12)
Symmetry Capital Management 24,000 24,000 0 0
LLC (13)
Total 2,489,300 2,489,300 0 0
========= =========
(1) Includes 110,475 shares subject to warrants which are currently
exercisable.
(2) Includes 110,475 shares subject to warrants which are currently
exercisable.
(3) Includes 34,940 shares subject to warrants which are currently
exercisable.
(4) Includes 28,369 shares subject to warrants which are currently
exercisable.
(5) Includes 20,648 shares subject to warrants which are currently
exercisable.
(6) Includes 17,824 shares subject to warrants which are currently
exercisable.
(7) Includes 17,021 shares subject to warrants which are currently
exercisable.
(8) Includes 15,698 shares subject to warrants which are currently
exercisable.
(9) Consists solely of those shares of common stock issuable upon the
exercise of warrants issued to such investors as part of a private
placement on June 15, 2001, which warrants are currently exercisable.
(10) Includes 14,184 shares subject to warrants which are currently
exercisable.
(11) Includes 6,704 shares subject to warrants which are currently
exercisable.
(12) Includes 5,462 shares subject to warrants which are currently
exercisable.
(13) Includes 4,000 shares subject to warrants which are currently
exercisable.
PLAN OF DISTRIBUTION
We will not receive any part of the proceeds from the sale of common
stock offered pursuant to this prospectus. The shares of our common stock
offered pursuant to this prospectus may be offered and sold from time to time by
the selling stockholders listed in the preceding section, or their
10
donees, transferees, pledgees or other successors in interest that receive such
shares as a gift or other non-sale related transfer. These selling stockholders
will act independently of us in making decisions with respect to the timing,
manner and size of each sale. All or a portion of the common stock offered by
this prospectus may be offered for sale from time to time on The Nasdaq National
Market or on one or more exchanges, or otherwise at prices and terms then
obtainable, or in negotiated transactions. The distribution of these securities
may be effected in one or more transactions that may take place on the
over-the-counter market, including, among others, ordinary brokerage
transactions, privately negotiated transactions or through sales to one or more
dealers for resale of such securities as principals, at market prices prevailing
at the time of sale, at prices related to such prevailing market prices or at
negotiated prices. Usual and customary or specifically negotiated brokerage fees
or commissions may be paid by the selling stockholders.
To the extent required, this prospectus may be amended or supplemented
from time to time to describe a specific plan of distribution. In effecting
sales, broker-dealers engaged by the selling stockholders may arrange for other
broker-dealers to participate in the resales. Broker-dealers or agents may
receive compensation in the form of commissions, discounts or concessions from
the selling stockholders. Broker-dealers or agents may also receive compensation
from the purchasers of the shares for whom they act as agents or to whom they
sell as principals, or both. Compensation as to a particular broker-dealer might
be in excess of customary commissions and will be in amounts to be negotiated in
connection with the sale. Broker-dealers or agents and any other participating
broker-dealers or the selling stockholders may be deemed to be "underwriters"
within the meaning of Section 2(11) of the Securities Act of 1933 in connection
with sales of the shares offered pursuant to this prospectus. Accordingly, any
such commission, discount or concession received by them and any profit on the
resale of the shares purchased by them may be deemed to be underwriting
discounts or commissions under the Securities Act of 1933. Because the selling
stockholders may be deemed to be "underwriters" within the meaning of Section
2(11) of the Securities Act of 1933, the selling stockholders will be subject to
the prospectus delivery requirements of the Securities Act of 1933.
In addition, any securities covered by this prospectus which qualify
for sale pursuant to Rule 144 promulgated under the Securities Act of 1933 or
other exemption from registration may be sold under Rule 144 or other exemption
rather than pursuant to this prospectus. There is no underwriter or coordinating
broker acting in connection with the proposed sale of shares by the selling
stockholders. The shares will be sold only through registered or licensed
brokers or dealers if required under applicable state securities laws. In
addition, in certain states the shares may not be sold unless they have been
registered or qualified for sale in the applicable state or an exemption from
the registration or qualification requirement is available and is complied with.
Under current applicable rules and regulations of the Securities
Exchange Act of 1934, any person engaged in the distribution of the shares may
not simultaneously engage in market making activities with respect to our common
stock for a period of two business days prior to the commencement of such
distribution. In addition, each selling stockholder will be subject to
applicable provisions of the Securities Exchange Act of 1934 and the associated
rules and regulations under the Securities Exchange Act of 1934, including
Regulation M, which provisions may limit the timing of purchases and sales of
shares of our common stock by the selling stockholders. We will make copies of
this prospectus available to the selling stockholders and have informed them of
the need for delivery of copies of this prospectus to purchasers at or prior to
the time of any sale of the shares being offered pursuant to this prospectus.
11
The selling security holders are not obligated to, and there is no
assurance that the selling security holders will, sell any or all of the shares.
We will bear all costs, expenses and fees in connection with the
registration of the resale of the shares covered by this prospectus. The selling
stockholders will pay any applicable underwriters' commissions and expenses,
brokerage fees or transfer taxes. The selling stockholders may agree to
indemnify any broker-dealer or agent that participates in transactions involving
sales of the shares against certain liabilities, including liabilities arising
under the Securities Act of 1933.
LEGAL MATTERS
The validity of the shares of common stock offered hereby will be
passed on by Stradling Yocca Carlson & Rauth, a Professional Corporation,
Newport Beach, California.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our financial
statements included in our Annual Report on Form 10-K for the year ended
December 31, 2001, as set forth in their report, which is incorporated by
reference in this prospectus and elsewhere in the registration statement. Our
financial statements are incorporated by reference in reliance on Ernst & Young
LLP's report, given on their authority as experts in accounting and auditing.
12
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We have filed a registration statement on Form S-3 with the Securities
and Exchange Commission relating to the common stock offered by this prospectus.
This prospectus does not contain all of the information set forth in the
registration statement and the exhibits and schedules thereto. Statements
contained in this prospectus as to the contents of any contract or other
document referred to are not necessarily complete and in each instance reference
is made to the copy of such contract or other document filed as an exhibit to
the registration statement, each such statement being qualified in all respects
by such reference. For further information with respect to us and the common
stock offered hereby, reference is made to such registration statement, exhibits
and schedules.
We are subject to the information and periodic reporting requirements
of the Securities Exchange Act of 1934, as amended, and in accordance therewith
file reports, proxy statements and other information with the Securities and
Exchange Commission. Such reports, proxy statements, other information and a
copy of the registration statement may be inspected by anyone without charge and
copies of these materials may be obtained upon the payment of the fees
prescribed by the Securities and Exchange Commission, at the Public Reference
Room maintained by the Securities and Exchange Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549. The public may obtain information on the operation
of the Public Reference Room by calling the Securities and Exchange Commission
at 1-800-SEC-0330. The registration statement and the reports, proxy statements
and other information filed by us are also available through the Securities and
Exchange Commission's website on the World Wide Web at the following address:
http://www.sec.gov.
INCORPORATION BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with the Securities and Exchange Commission,
which means that we can disclose important information to you by referring to
those documents. We incorporate by reference the documents listed below and any
additional documents filed by us with the Securities and Exchange Commission
under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
until this offering of securities is terminated. The information we incorporate
by reference is an important part of this prospectus, and any information that
we file later with the Securities and Exchange Commission will automatically
update and supersede this information.
We hereby incorporate by reference the following documents:
1. Our Annual Report on Form 10-K for the fiscal year ended
December 31, 2001 filed with the SEC on March 5, 2002;
13
2. The description of our common stock contained in our
Registration Statement on Form 8-A, filed with the SEC under
Section 12 of the Securities Exchange Act of 1934, including
any amendment or report filed for the purpose of updating such
description; and
3. All other reports filed by us pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934
prior to the termination of the offering.
You may request a copy of these filings, at no cost, by writing or
calling us at Sonus Pharmaceuticals, Inc., 22026 20th Avenue S.E., Bothell,
Washington 98021, telephone number (425) 487-9500.
14
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth all costs and expenses, other than
underwriting discounts and commissions, payable by us in connection with the
sale of the common stock being registered hereunder. All of the amounts shown
are estimates except for the SEC registration fee.
TO BE PAID BY
SONUS PHARMACEUTICALS
---------------------
SEC registration fee...................................... $ 1,273
Nasdaq National Market listing fee........................ 24,893
Legal fees................................................ 15,000
Accounting fees........................................... 10,000
Miscellaneous expenses.................................... 5,000
-------------
Total............................................ $ 56,166
=============
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
(a) As permitted by the Delaware General Corporation Law, our
Certificate of Incorporation eliminates the liability of directors to the
Company or its stockholders for monetary damages for breach of fiduciary duty as
a director, except to the extent otherwise prohibited by the Delaware General
Corporation Law.
(b) Our Certificate of Incorporation provides that we will indemnify
each person who was or is made a party to any proceeding by reason of the fact
that such person is or was a director or officer of the Company against all
expense, liability and loss reasonably incurred or suffered by such person in
connection therewith to the fullest extent authorized by the Delaware General
Corporation Law. Our Bylaws provide for a similar indemnity to our directors and
officers to the fullest extent authorized by the Delaware General Corporation
Law.
(c) Our Certificate of Incorporation also gives us the ability to enter
into indemnification agreements with each of our officers and directors. We have
entered into indemnification agreements with each of our directors and executive
officers. The indemnification agreements provide for the indemnification of
directors and officers against any and all expenses, judgements, fines,
penalties and amounts paid in settlement, to the fullest extent permitted by
law.
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ITEM 16. EXHIBITS
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
5.1 Opinion of Stradling Yocca Carlson & Rauth.*
10.1 Supply Agreement dated January 22, 2002 between Indena SpA and Sonus Pharmaceuticals, Inc.*
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of Stradling Yocca Carlson & Rauth (see Exhibit 5.1).*
24.1 Power of Attorney.*
* PREVIOUSLY FILED
ITEM 17. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
registration statement; and
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement;
provided, however, that clauses (i) and (ii) do not apply if
the information required to be included in a post-effective amendment by those
clauses is confirmed in our periodic reports filed with or furnished to the
Commission pursuant to Section 13 of Section 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment 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.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities
16
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) 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.
(c) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act of 1933, to treat 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 of 1933 as part of this
registration statement as of the time it was declared effective.
(2) For purposes of determining any liability under the
Securities Act of 1933, 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 as
the initial bona fide offering thereof.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of 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 of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by us
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, we will, unless in the opinion of our counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question of whether such indemnification by us is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant 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 No. 1 to registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Bothell, State of
Washington, on the 6th day of March, 2002.
SONUS PHARMACEUTICALS, INC.
By: /s/ Richard J. Klein
-----------------------------------------------
Richard J. Klein
Vice President, Finance and Chief Financial
Officer
(Principal Financial and Accounting Officer)
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Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Michael A. Martino* President, Chief Executive Officer March 6, 2002
- --------------------------------------- and Director
Michael A. Martino (Principal Executive Officer)
/s/ Richard J. Klein Vice President, Finance and March 6, 2002
- --------------------------------------- Chief Financial Officer
Richard J. Klein (Principal Financial and Accounting Officer)
/s/ George W. Dunbar, Jr. Director, Co-Chairman of the Board of March 6, 2002
- --------------------------------------- Directors
George W. Dunbar, Jr.
/s/ Christopher S. Henney Director March 6, 2002
- ---------------------------------------
Christopher S. Henney, Ph.D, D. Sc.
/s/ Robert E. Ivy Director, Co-Chairman of the Board of March 6, 2002
- --------------------------------------- Directors
Robert E. Ivy
/s/ Dwight Winstead* Director March 6, 2002
- ---------------------------------------
Dwight Winstead
* By: /s/ Richard J. Klein March 6, 2002
---------------------------------
Richard J. Klein
as Attorney-in-Fact
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EXHIBIT INDEX
Exhibit Sequential
Number Description Page Number
- ------ ----------- -----------
5.1 Opinion of Stradling Yocca Carlson & Rauth, a Professional Corporation.* --
10.1 Supply Agreement dated January 22, 2002 between Indena SpA and Sonus --
Pharmaceuticals, Inc.*
23.1 Consent of Ernst & Young LLP, Independent Auditors. --
--
23.2 Consent of Stradling Yocca Carlson & Rauth, a Professional
Corporation (included in the Opinion filed as Exhibit 5.1).*
24.1 Power of Attorney.* --
* Previously Filed
20