File No. 333-120262
Filed under Rule 424(b)(3)
PROSPECTUS SUPPLEMENT NO. 2 DATED DECEMBER 14, 2005
To the Prospectus dated November 5, 2004 as supplemented by Prospectus
Supplement No. 1 dated July 20, 2005
CYTOGEN CORPORATION
--------------------------------------------------------------------------------
This prospectus supplement supplements, and should be read in conjunction with,
the prospectus, dated November 5, 2004, as supplemented by Prospectus Supplement
No. 1 dated July 20, 2005, relating to $70,000,000 of debt securities, common
stock, preferred stock, warrants and units that we may offer and sell from time
to time. We will receive all of the proceeds from any securities sold. The
prospectus was filed as part of our registration statement on Form S-3 (No.
333-120262).
We are offering up to 3,729,556 shares of our common stock and warrants to
purchase 932,389 shares of our common stock to one or more institutional
investors pursuant to this prospectus supplement and the accompanying
prospectus. The common stock and warrants will be purchased at the negotiated
unit price of $3.56 per unit. We are also offering warrants to purchase 186,478
shares of our common stock that are being issued as compensation to the
placement agent in the transaction.
Our common stock is quoted on the Nasdaq National Market under the symbol
"CYTO." On December 12, 2005, the last reported sale price of our common stock
on the Nasdaq National Market was $3.54 per share.
Rodman & Renshaw, LLC has been retained to act as placement agent for us in
connection with the arrangement of this transaction. We have agreed to pay
Rodman & Renshaw, LLC the aggregate placement agent fees set forth in the table
below. The placement agent is not required to sell any specific number or dollar
amount of shares, but will use reasonable efforts to arrange for the sale of all
3,729,556 of the shares and all 932,389 of the warrants. See "Plan of
Distribution" in this prospectus supplement.
Per Maximum
Unit Offering
------ -----------
Price to the public $ 3.56 $13,277,219
Placement agent fees $ 0.178 $ 663,861
Proceeds, before expenses, to Cytogen $ 3.382 $12,613,358
We expect total offering expenses, including placement agent fees, to be
approximately $750,000 for all sales pursuant to the prospectus supplemented by
this prospectus supplement.
--------------------------------------------------------------------------------
INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS"
BEGINNING ON PAGE 4 OF THE PROSPECTUS.
--------------------------------------------------------------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS SUPPLEMENT IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
--------------------------------------------------------------------------------
No dealer, salesperson or any other person has been authorized to give any
information or make any representations not contained in this prospectus
supplement or the prospectus, as previously supplemented, and, if given or made,
the information or representations must not be relied upon as having been
authorized by us. This prospectus supplement and the prospectus, as previously
supplemented, do not constitute an offer to sell, or a solicitation of an offer
to buy, any securities to any person in any jurisdiction where such an offer or
solicitation would be unlawful. Neither the delivery of this prospectus
supplement or the prospectus, as previously supplemented, nor any sale made
hereunder or thereunder shall, under any circumstance, create any implication
that the information contained herein or therein is correct as of any time
subsequent to the date hereof.
--------------------------------------------------------------------------------
This prospectus supplement and the accompanying prospectus, dated November 5,
2004, relate to the offer by us of up to 3,729,556 shares of our common stock
and warrants to purchase 1,118,867 shares of our common stock. You should read
this prospectus supplement along with the accompanying prospectus carefully
before making a decision to invest in our common stock. These documents contain
important information you should consider when making your investment decision.
This prospectus supplement contains information about the common stock offered
hereby and the prospectus contains information about our securities generally.
This prospectus supplement may add, update or change information in the
prospectus. You should rely only on the information provided in this prospectus
supplement and the accompanying prospectus or documents incorporated by
reference in the accompanying prospectus. We have not authorized anyone to
provide you with any other information.
Issuance of Common Stock
------------------------
On December 13, 2005, we entered into a securities purchase agreement for the
sale of an aggregate of 3,729,556 shares of our common stock and warrants to
purchase 932,389 shares of our common stock to certain institutional investors
for an aggregate purchase price of approximately $13,300,000. The prospectus
provides for the sale of up to $70,000,000 in registered securities of our
common stock.
Terms of Warrants
-----------------
The warrants include the following terms:
o a term of five years;
o an exercise price of $4.25 per share;
o a cashless exercise provision; and
o the warrants cannot be exercised until six months and one day have
elapsed from the date of issuance.
2
--------------------------------------------------------------------------------
THE OFFERING
Common stock offered in this offering: 3,729,556 shares
Common stock underlying warrants: 932,389 shares
Common stock underlying placement agent warrants: 186,478 shares
Common stock outstanding before this offering: 18,741,488 shares
Common stock to be outstanding after this offering: 22,471,044 shares
Use of proceeds: See "Use of Proceeds" on page 24 of the prospectus.
Nasdaq National Market symbol: CYTO
The information above is based on 18,741,488 shares of our common stock
outstanding as of September 30, 2005. It does not include:
o 1,229,513 shares of our common stock issuable upon the exercise of
stock options outstanding as of September 30, 2005 at a weighted
average exercise price of $8.067 per share;
o 2,684,218 shares of common stock issuable upon the exercise of
warrants outstanding as of September 30, 2005 at a weighted average
exercise price of $9.78 per share; and
o 601,924 shares of common stock reserved for future awards under our
stock incentive plans and stock purchase plan as of September 30,
2005.
In June 2005, the Company awarded an aggregate of 161,600 shares of restricted
common stock to employees of the Company pursuant to the terms of the Company's
2004 Stock Incentive Plan. Such restricted shares are subject to future vesting
and will be issued upon the satisfaction of such vesting provisions and other
terms and conditions related thereto.
3
PLAN OF DISTRIBUTION
We are offering the shares of common stock and the warrants through a placement
agent. Rodman & Renshaw, LLC have agreed to act as placement agent for the sale
of up to 3,729,556 shares of our common stock and warrants to purchase 932,389
shares of our common stock. The placement agent is not purchasing or selling any
shares by this prospectus supplement and the accompanying prospectus, nor are
they required to arrange the purchase or sale of any specific number or dollar
amount of the shares, but have agreed to use reasonable efforts to arrange for
the sale of all 3,729,556 shares of common stock and all warrants to purchase
932,389 shares of our common stock.
The placement agent has arranged for the sale to one or more purchasers of the
shares of common stock and warrants offered pursuant to this prospectus
supplement and the accompanying prospectus through direct purchase agreements
between the purchasers and us. We will pay the placement agents a total
commission equal to 5% of the gross proceeds of the sales of shares of common
stock and warrants and issue to the placement agent warrants to purchase 186,478
shares of our common stock.
The following table shows the per unit and total commissions we will pay to the
placement agent in connection with the sale of the shares and warrants offered
pursuant to this prospectus supplement and the accompanying prospectus, assuming
the purchase of all of the shares offered hereby.
Per unit $ 0.178
Maximum Offering Total $ 663,861
Our obligation to issue and sell shares to the purchasers is subject to the
conditions set forth in the purchase agreements, which may be waived by us in
our discretion. A purchaser's obligation to purchase shares is subject to
conditions set forth in the purchase agreement as well, which also may be
waived.
It is expected that the sale of 3,729,556 shares of our common stock and
warrants to purchase 932,389 shares of our common stock will be completed on or
about December 14, 2005. We estimate the total expenses of this offering which
will be payable by us, excluding the commissions, will be approximately $86,000.
We have agreed to indemnify the placement agent against certain liabilities,
including liabilities under the Securities Act of 1933, as amended.
The engagement agreement with Rodman & Renshaw, LLC is included as an exhibit to
our Current Report on Form 8-K/A that was filed with the Securities and Exchange
Commission in connection with this offering.
We have agreed to a 30-day "lock up" with respect to shares of our common stock
and other of our securities, including securities that are convertible into
shares of common stock and securities that are exchangeable or exercisable for
shares of common stock. This means that, subject to certain exceptions, for a
period of 30 days following the date of this prospectus supplement, we may not
offer, sell, pledge or otherwise dispose of these securities without the prior
written consent of Rodman & Renshaw, LLC.
December 14, 2005
4