SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D/A
(AMENDMENT No. 3 to SCHEDULE 13D)
Under the Securities Exchange Act of 1934
ARONEX PHARMACEUTICALS, INC.
-------------------------------------------------------------------------
(Name of Issuer)
Shares of Common Stock, par value $0.001 per share
-------------------------------------------------------------------------
(Title of Class of Securities)
042666206
-------------------------------------------------------------------------
(CUSIP NUMBER)
Paragon Associates and Paragon Associates II Joint Venture
The Bradbury Dyer Foundation
500 Crescent Court
Suite 260
Dallas, Texas 75201
Tel. No.: (214) 871-3700
-------------------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
- with copies to -
Ford Lacy, P.C.
Akin, Gump, Strauss, Hauer & Feld, L.L.P.
1700 Pacific Avenue, Suite 4100
Dallas, Texas 75201-4618
(214) 969-2800
February 23, 1999
(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4) check the following
box [ ]
The information required in the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934, as amended ("Act"), or otherwise subject to the
liabilities of that section of the Act but shall be subject to all other
provisions of the Act.
CUSIP No. 042666206 13D/A
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Paragon Associates and Paragon Associates II Joint Venture -
75-1956332
The Bradbury Dyer Foundation - 75-2629363
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Texas
NUMBER OF 7 SOLE VOTING POWER 1,827,611
SHARES
BENEFICIALLY 8 SHARED VOTING POWER 0
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER 1,827,611
REPORTING
PERSON WITH 10 SHARED DISPOSITIVE POWER 0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,827,611
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.15%
14 TYPE OF REPORTING PERSON*
OO
*SEE INSTRUCTIONS BEFORE FILLING OUT
AMENDMENT No. 3 to SCHEDULE 13D
This Amendment No. 3 to Schedule 13D is filed as an amendment to the
initial statement on Schedule 13D relating to shares of common stock, par
value $0.001 per share ("Common Stock"), of Aronex Pharmaceuticals, Inc.
(the "Issuer"), as filed with the Securities and Exchange Commission (the
"Commission") on October 20, 1997 and amended by Amendment No. 1 to
Schedule 13D filed with the Commission on December 3, 1997 and Amendment
No. 2 to Schedule 13D filed with the Commission on December 18, 1998 (as
amended, the "Amended Schedule 13D"). The Amended Schedule 13D is hereby
further amended and supplemented as follows:
ITEM 3. SOURCE AND AMOUNT OF FUNDS
Item 3 of the Amended Schedule 13D is hereby amended and restated in
its entirety to read as follows:
As of February 23, 1999, the Foundation and Paragon JV had invested
$7,308,620 in shares of Common Stock of Aronex Pharmaceuticals, Inc. (the
"Issuer") as described below in Item 5. The source of these funds was the
respective working capital of the Foundation and Paragon JV. On February
23, 1999 Paragon JV purchased 400,000 shares of Common Stock of the Issuer
with $875,000 of working capital of Paragon JV.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
Item 5 of the Amended Schedule 13D is hereby amended by amending and
restating Items 5(a), (b) and (c) as follows:
(a) According to the Issuer's Prospectus dated February 16, 1998 for
a registered public offering of 6,000,000 shares of Common Stock, after the
offering, 22,415,664 shares of Common Stock would be issued and
outstanding. As of the date hereof, Paragon JV (in carrying out the
purposes of Paragon and Paragon II) has beneficial ownership of 1,807,611
of such shares, representing approximately 8.06% of the Common Stock of the
Issuer. Under the terms of the joint venture agreement of Paragon JV, a
copy of which is herewith filed as Annex A and incorporated herein by
reference, Paragon and Paragon II have beneficial ownership of such shares
in proportion to their respective accounts in the joint venture. As of the
date hereof, the Foundation has beneficial ownership of 20,000 shares of
the Issuer's Common Stock, representing approximately 0.09% of the Common
Stock of the Issuer. Mr. Dyer does not have direct beneficial ownership of
any of the foregoing shares; however, Mr. Dyer, as president of the
Foundation, sole general partner of Paragon and Paragon II, and agent for
Paragon JV, may be deemed, for purposes of determining beneficial ownership
pursuant to Rule 13d-3, to have indirect beneficial ownership of such
shares.
(b) Paragon JV has the sole power to vote or to direct the vote of
and the sole power to dispose or to direct the disposition of a total of
1,807,611 shares of Common Stock of the Issuer; however, Paragon and
Paragon II, as co-venturers in Paragon JV, each hold an undivided interest
in such shares based on their respective accounts in Paragon JV, and may be
deemed, for purposes of determining beneficial ownership pursuant to Rule
13d-3, to have shared power with Paragon JV to vote or to direct the vote
of and to dispose or to direct the disposition of such shares. The
Foundation has the sole power to vote or direct the vote of and the sole
power to dispose or to direct the disposition of a total of 20,000 shares
of Common Stock of the Issuer. Mr. Dyer, as president of the Foundation,
sole general partner of Paragon and Paragon II and managing agent for
Paragon JV, may be deemed, for purposes of determining beneficial ownership
pursuant to Rule 13d-3, to have shared power with Paragon JV and the
Foundation to vote or to direct the vote of and to dispose or to direct the
disposition of such shares.
(c) The transactions in the Issuer's securities by the Foundation and
Paragon JV during the period of December 31, 1998 to February 23, 1999 are
listed on Annex B attached hereto and made apart hereof.
ANNEX A
JOINT OPERATION AND
ACCOUNTING PROCEDURES AGREEMENT
AGREEMENT dated as of January 1, 1984 by and among Bradbury Dyer III
(hereinafter called "Dyer"), an individual residing in Dallas, Texas,
Paragon Associates (hereinafter called "Old Paragon"), a Texas limited
partnership of which Dyer is the general partner, and Paragon Associates II
(hereinafter called "Paragon II"), a Texas limited partnership of which
Dyer is the general partner. The address of Dyer, Old Paragon and Paragon
II is Suite 2340, One Dallas Centre, 350 North St. Paul, Dallas, Texas
75201.
Note: The Introductory Statement to this Agreement has been deleted
because it does not govern the terms of the joint operation of the parties
hereto and does contain certain information which the reporting persons
desire to hold in confidence.
AGREEMENT
1. Old Paragon and Paragon II hereby form a joint venture for the
purpose of jointly carrying out the purposes set forth in the Limited
Partnership Agreements of Old Paragon and Paragon II and accounting for
their commingled assets and liabilities exclusive of the contingent
liabilities of the Metropolitan Claims which shall be retained by, and
remain solely the obligation of, Old Paragon. Each party hereto may
withdraw from the joint venture its share of the assets subject to its
share of the liabilities at any time.
2. Old Paragon confirms to Paragon II that Old Paragon intends
solely to retain and does retain any and all liability which it might have
with respect to the Metropolitan Claims and Old Paragon hereby indemnifies
the joint venture and Paragon II and each person or entity who is at any
time a limited partner of Paragon II against any loss or liability with
respect to, or resulting from, the Metropolitan Claims and any and all
costs and expenses, including attorney's fees, which any of them may incur
in connection with the defense thereof or the enforcement of this
provision. Dyer will not permit capital withdrawals from Old Paragon which
would impair its ability to satisfy any liability which it might have with
respect to the Metropolitan Claims or with respect to obligations under
this paragraph 2.
3. Dyer, as agent for the joint venture, hereby is authorized to
open any and all bank, brokerage or other accounts necessary or useful for
the joint operation of Old Paragon and Paragon II. Any bank, broker or
other person may conclusively rely on this agreement as evidence of Dyer's
authority to so act.
4. Old Paragon shall have a _______% interest in the joint venture
and Paragon II shall have a ________% interest in the joint venture. Such
interests are based upon Old Paragon's net worth (net of withdrawals) at
December 31, 1983 of $_______________ and Paragon II's net worth as of
January 1, 1984 of $______________. These sharing ratios will be adjusted
to reflect any contributions or withdrawals by either Old Paragon or
Paragon II. Each of Old Paragon and Paragon II hereby assumes through the
joint venture a pro rata interest in each contributed asset and liability
of the other, it is being understood and agreed that no liability with
respect to the Metropolitan Claims is being assumed through the joint
venture or otherwise. Further, Old Paragon and Paragon II each agree that
any gain or loss realized for federal income tax purposes which is
attributable to unrealized gain or loss existing on January 1, 1984 shall
be included in the gain or loss of the contributing party.
5. Old Paragon and Paragon II agree that each will separately
account for its interest in the joint venture and each will separately
prepare and file all appropriate tax returns.
6. Dyer, as agent for the joint venture, will make any and all tax
filings and elections for the joint venture as appropriate to reflect the
separate and distinct nature of the interests of Old Paragon and Paragon II
in the joint venture.
7. The authority of Dyer, as agent for the accounts of the joint
venture, shall be the same as his authority with respect to the separate
assets and liabilities of Old Paragon and Paragon II under the Limited
Partnership Agreement for Paragon Associates (as amended) and the Limited
Partnership Agreement for Paragon Associates II.
8. This Agreement shall be effective as of January 1, 1984. Any
activity in any account of Old Paragon or Paragon II since that date will
be deemed to be for the account of the joint venture.
9. Paragraph 2 of this Agreement may not be amended or terminated
without the prior written consent of each person or entity which becomes a
limited partner of Paragon II any time on or after January 1, 1984.
10. Nothing in this Agreement shall prevent Bradbury Dyer III from
causing the termination of the joint venture when there is no longer
pending or threatened against Bradbury Dyer III or Paragon Associates any
Metropolitan Claim.
[SIGNATURE PAGE FOLLOWS]
EXECUTED at Dallas, Texas as of the day and year first above written.
PARAGON ASSOCIATES
By: /S/ BRADBURY DYER III
------------------------------------
Bradbury Dyer III
General Partner
PARAGON ASSOCIATES II
By: /S/ BRADBURY DYER III
------------------------------------
Bradbury Dyer III
General Partner
/S/ BRADBURY DYER III
------------------------------------
Bradbury Dyer III
ANNEX B
PARAGON JV
Transaction Quantity Price per
Date Transaction (shares) Share ($)
----------- ------------ -------- ---------
12/31/98 Distribute shares to (16,889) N/A
Limited Partners of
Paragon Associates and
Paragon Associates II
2/23/99 Buy 400,000 2.1875
-------
383,111
=======
THE FOUNDATION
Transaction Quantity Price per
Date Buy/Sell (shares) Share ($)
----------- -------- --------- ---------
No transactions
Signature
After reasonable inquiry and to the best of my knowledge and belief,
the undersigned certifies that the information set forth in this statement
is true, complete and correct.
Dated: February 26, 1999
Paragon Associates and Paragon Associates II
Joint Venture
By: /S/ BRADBURY DYER III
------------------------------------
Bradbury Dyer III, Authorized Agent
The Bradbury Dyer Foundation
By: /S/ BRADBURY DYER III
------------------------------------
Bradbury Dyer III, President
