SONUS PHARMACEUTICALS INC
EXHIBIT 10.42
<DOCUMENT>
<TYPE>EX-10.42
<SEQUENCE>3
<FILENAME>ex10-42.txt
<DESCRIPTION>EXHIBIT 10.42
<TEXT>

<PAGE>   1
                                                                   EXHIBIT 10.42
                          SONUS PHARMACEUTICALS, INC.

                             STOCK OPTION AGREEMENT

        TYPE OF OPTION (CHECK ONE): [ ] INCENTIVE  [ ] NONQUALIFIED

        This Stock Option Agreement (the "Agreement") is entered into as of
_____________, 200_, by and between SONUS PHARMACEUTICALS, INC., a Delaware
corporation (the "Company"), and _____________ (the "Optionee") pursuant to the
Company's 2000 Stock Incentive Plan (the "Plan"). Any capitalized term not
defined herein shall have the meaning ascribed to it in the Plan.

        1. GRANT OF OPTION. The Company hereby grants to Optionee an option (the
"Option") to purchase all or any portion of a total of________________(________)
shares (the "Shares") of the Common Stock of the Company at a purchase price of
_____________ ($________ ) per share (the "Exercise Price"), subject to the
terms and conditions set forth herein and the provisions of the Plan. If the box
marked "Incentive" above is checked, then this Option is intended to qualify as
an "incentive stock option" as defined in Section 422 of the Internal Revenue
Code of l986, as amended (the "Code"). If this Option fails in whole or in part
to qualify as an incentive stock option, or if the box marked "Nonqualified" is
checked, then this Option shall to that extent constitute a nonqualified stock
option.

        2. VESTING OF OPTION. The right to exercise this Option shall vest in
installments, and this Option shall be exercisable from time to time in whole or
in part as to any vested installment, as follows:

<TABLE>
<CAPTION>
                                                          This Option shall be
                   On or After:                            Exercisable as to
                   ------------                            -----------------
 <S>                                                          <C>
 (i)  the first anniversary of this Agreement:                       __ % of the Shares

 (ii) the second anniversary of this Agreement:        an additional __ % of the Shares

 (iii)  the third anniversary of this Agreement:       an additional __ % of the Shares

 (iv)  the fourth anniversary of this Agreement:       an additional __ % of the Shares

 (v)  the fifth anniversary of this Agreement:         an additional __ % of the Shares
</TABLE>

No additional shares shall vest after the date of termination of Optionee's
Continuous Service, as defined below, but this Option shall continue to be
exercisable in accordance with Section 3 hereof with respect to that number of
shares that have vested as of the date of termination of Optionee's Continuous
Service. As used in this Agreement, the term "Continuous Service" means (i)
employment by either the Company or any parent or subsidiary corporation of the
Company, or by a corporation or a parent or subsidiary of a corporation issuing
or assuming a stock option in a transaction to which Section 424(a) of the
Internal Revenue Code of 1986, as amended (the "Code") applies, which is
uninterrupted except for vacations, illness (except for permanent disability, as
defined in Section 22(e)(3) of the Code), or leaves of absence which are
approved in writing by the Company or any of such other employer corporations,
if applicable, (ii) service as a member of the Board of Directors or as an
officer of the Company until Optionee resigns, is removed from office, or
Optionee's term of office expires and he is not reelected, or (iii) so long as
Optionee is engaged as a consultant or service provider to the Company or other
corporation referred to in clause (i) above.



<PAGE>   2


        3. TERM OF OPTION. Optionee's right to exercise this Option shall
terminate immediately upon the first to occur of the following:

               (a) the expiration of ten (10) years from the date of this
Agreement;

               (b) termination of Optionee's Continuous Service if such
termination occurs for any reason other than permanent disability, death or
voluntary resignation;

               (c) the expiration of ___ (_) month from the date of termination
of Optionee's Continuous Service if such termination occurs due to voluntary
resignation; provided, however, that if Optionee dies during such one-month
period the provisions of Section 3(e) below shall apply;

               (d) the expiration of one (1) year from the date of termination
of Optionee's Continuous Service if such termination is due to permanent
disability of the Optionee (as defined in Section 22(e)(3) of the Code);

               (e) the expiration of one (1) year from the date of termination
of Optionee's Continuous Service if such termination is due to Optionee's death
or if death occurs during the one-month period following termination of
Optionee's Continuous Service pursuant to Section 3(c) above; or

               (f) upon the consummation of a "Change in Control" (as defined in
Section 2.5 of the Plan), unless otherwise provided pursuant to Section 11
below.

        4. EXERCISE OF OPTION. On or after the vesting of any portion of this
Option in accordance with Sections 2 or 11 hereof, and until termination of the
right to exercise this Option in accordance with Section 3 above, the portion of
this Option which has vested may be exercised in whole or in part by the
Optionee (or, after his or her death, by the person designated in Section 5
below) upon delivery of the following to the Company at its principal executive
offices:

               (a) a written notice of exercise which identifies this Agreement
and states the number of Shares then being purchased (but no fractional Shares
may be purchased);

               (b) a check or cash in the amount of the Exercise Price (or
payment of the Exercise Price in such other form of lawful consideration as the
Administrator may approve from time to time under the provisions of Section 5.3
of the Plan);

               (c) a check or cash in the amount reasonably requested by the
Company to satisfy the Company's withholding obligations under federal, state or
other applicable tax laws with respect to the taxable income, if any, recognized
by the Optionee in connection with the exercise of this Option (unless the
Company and Optionee shall have made other arrangements for deductions or
withholding from Optionee's wages, bonus or other compensation payable to
Optionee, or by the withholding of Shares issuable upon exercise of this Option
or the delivery of Shares owned by the Optionee in accordance with Section 11.1
of the Plan, provided such arrangements satisfy the requirements of applicable
tax laws); and

               (d) a letter, if requested by the Company, in such form and
substance as the Company may require, setting forth the investment intent of the
Optionee, or person designated in Section 5 below, as the case may be.



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<PAGE>   3
        5. DEATH OF OPTIONEE; NO ASSIGNMENT. The rights of the Optionee under
this Agreement may not be assigned or transferred except by will or by the laws
of descent and distribution, and may be exercised during the lifetime of the
Optionee only by such Optionee. Any attempt to sell, pledge, assign,
hypothecate, transfer or dispose of this Option in contravention of this
Agreement or the Plan shall be void and shall have no effect. If the Optionee's
Continuous Service terminates as a result of his or her death, and provided
Optionee's rights hereunder shall have vested pursuant to Section 2 hereof,
Optionee's legal representative, his or her legatee, or the person who acquired
the right to exercise this Option by reason of the death of the Optionee
(individually, a "Successor") shall succeed to the Optionee's rights and
obligations under this Agreement. After the death of the Optionee, only a
Successor may exercise this Option.

        6. REPRESENTATIONS AND WARRANTIES OF OPTIONEE.

               (a) Optionee represents and warrants that this Option is being
acquired by Optionee for Optionee's personal account, for investment purposes
only, and not with a view to the distribution, resale or other disposition
thereof.

               (b) Optionee acknowledges that the Company may issue Shares upon
the exercise of the Option without registering such Shares under the Securities
Act of l933, as amended (the "Securities Act"), on the basis of certain
exemptions from such registration requirement. Accordingly, Optionee agrees that
his or her exercise of the Option may be expressly conditioned upon his or her
delivery to the Company of an investment certificate including such
representations and undertakings as the Company may reasonably require in order
to assure the availability of such exemptions, including a representation that
Optionee is acquiring the Shares for investment and not with a present intention
of selling or otherwise disposing thereof and an agreement by Optionee that the
certificates evidencing the Shares may bear a legend indicating such
non-registration under the Securities Act and the resulting restrictions on
transfer. Optionee acknowledges that, because Shares received upon exercise of
an Option may be unregistered, Optionee may be required to hold the Shares
indefinitely unless they are subsequently registered for resale under the
Securities Act or an exemption from such registration is available.

               (c) Optionee acknowledges receipt of a copy of the Plan and
understands that all rights and obligations connected with this Option are set
forth in this Agreement and in the Plan.

        7. RIGHT OF FIRST REFUSAL.

               (a) The Shares acquired pursuant to the exercise of this Option
may be sold by the Optionee only in compliance with the provisions of this
Section 7, and subject in all cases to compliance with the provisions of Section
6(b) hereof. Prior to any intended sale, Optionee shall first give written
notice (the "Offer Notice") to the Company specifying (i) his or her bona fide
intention to sell or otherwise transfer such Shares, (ii) the name and address
of the proposed purchaser(s), (iii) the number of Shares the Optionee proposes
to sell (the "Offered Shares"), (iv) the price for which he or she proposes to
sell the Offered Shares, and (v) all other material terms and conditions of the
proposed sale.

               (b) Within thirty (30) days after receipt of the Offer Notice,
the Company or its nominee(s) may elect to purchase all or any portion of the
Offered Shares at the price and on the terms and conditions set forth in the
Offer Notice by delivery of written notice (the "Acceptance Notice") to the
Optionee specifying the number of Offered Shares that the Company or its
nominees



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<PAGE>   4
elect to purchase. Within fifteen (15) days after delivery of the Acceptance
Notice to the Optionee, the Company and/or its nominee(s) shall deliver to the
Optionee payment of the amount of the purchase price of the Offered Shares to be
purchased pursuant to this Section 7, against delivery by the Optionee of a
certificate or certificates representing the Offered Shares to be purchased,
duly endorsed for transfer to the Company or such nominee(s), as the case may
be. Payment shall be made on the same terms as set forth in the Offer Notice or,
at the election of the Company or its nominees(s), by check or wire transfer of
funds. If the Company and/or its nominee(s) do not elect to purchase all of the
Offered Shares, the Optionee shall be entitled to sell the balance of the
Offered Shares to the purchaser(s) named in the Offer Notice at the price
specified in the Offer Notice or at a higher price and on the terms and
conditions set forth in the Offer Notice; provided, however, that such sale or
other transfer must be consummated within 60 days from the date of the Offer
Notice and any proposed sale after such 60-day period may be made only by again
complying with the procedures set forth in this Section 7.

               (c) The Optionee may transfer all or any portion of the Shares to
a trust established for the sole benefit of the Optionee and/or his or her
spouse or children without such transfer being subject to the right of first
refusal set forth in this Section 7, provided that the Shares so transferred
shall remain subject to the terms and conditions of this Agreement and no
further transfer of such Shares may be made without complying with the
provisions of this Section 7.

               (d) Any Successor of Optionee pursuant to Section 5 hereof, and
any transferee of the Shares pursuant to this Section 7, shall hold the Shares
subject to the terms and conditions of this Agreement and no further transfer of
the Shares may be made without complying with the provisions of this Section 7
and the Plan.

               (e) The provisions of this Section 7 shall not apply to a sale of
the Shares to the Company pursuant to Section 8 below.

               (f) The rights provided the Company and its nominee(s) under this
Section 7 shall terminate upon the closing of the initial public offering of
shares of the Company's Common Stock pursuant to a registration statement filed
with and declared effective by the Securities and Exchange Commission under the
Securities Act.

        8. COMPANY'S REPURCHASE RIGHT.

               (a) The Company shall have the right (but not the obligation) to
repurchase (the "Repurchase Right") any or all of the Shares acquired pursuant
to the exercise of this Option in the event that the Optionee's Continuous
Service should terminate for any reason whatsoever, including without limitation
Optionee's death, disability, voluntary resignation or termination by the
Company with or without cause. Upon exercise of the Repurchase Right, the
Optionee shall be obligated to sell his or her Shares to the Company, as
provided in this Section 8. The Repurchase Right may be exercised by the Company
at any time during the period commencing on the date of termination of
Optionee's Continuous Service and ending one-hundred twenty (120) days after the
last to occur of the following:

                      (i)    the termination of Optionee's Continuous Service;

                      (ii)   the expiration of Optionee's right to exercise this
Option pursuant to Section 3 hereof; or



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<PAGE>   5
                      (iii)  in the event of Optionee's death, receipt by the
Company of notice of the identity and address of Optionee's Successor (as
defined in Section 5 hereof).

               (b) The purchase price for Shares repurchased hereunder (the
"Repurchase Price") shall be the Fair Market Value per share of Common Stock
(determined in accordance with Section 2.12 of the Plan) as of the date of
termination of Optionee's Continuous Service.

               (c) Written notice of exercise of the Repurchase Right, stating
the number of Shares to be repurchased and the Repurchase Price per Share, shall
be given by the Company to the Optionee or his or her Successor, as the case may
be, during the period specified in Section 8(a) above.

               (d) The Repurchase Price shall be payable, at the option of the
Company, by check or by cancellation of all or a portion of any outstanding
indebtedness of Optionee to the Company, or by any combination thereof. The
Repurchase Price shall be paid without interest within sixty (60) days after
delivery of the notice of exercise of the Repurchase Right, against delivery by
the Optionee or his or her Successor of a certificate or certificates
representing the Shares to be repurchased, duly endorsed for transfer to the
Company.

               (e) The rights provided the Company under this Section 8 shall
terminate upon the closing of the initial public offering of shares of the
Company's Common Stock pursuant to a registration statement filed with and
declared effective by the Securities and Exchange Commission under the
Securities Act.

        9. RESTRICTIVE LEGENDS.

               (a) Optionee hereby acknowledges that federal securities laws and
the securities laws of the state in which he or she resides may require the
placement of certain restrictive legends upon the Shares issued upon exercise of
this Option, and Optionee hereby consents to the placing of any such legends
upon certificates evidencing the Shares as the Company, or its counsel, may deem
necessary or advisable.

               (b) In addition, all stock certificates evidencing the Shares
shall be imprinted with a legend substantially as follows:

        THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
        CERTAIN RESTRICTIONS ON TRANSFER, REPURCHASE RIGHTS AND A RIGHT OF FIRST
        REFUSAL IN FAVOR OF THE CORPORATION AND/OR ITS NOMINEE(S), AS SET FORTH
        IN A STOCK OPTION AGREEMENT. TRANSFER OF THESE SHARES MAY BE MADE ONLY
        IN COMPLIANCE WITH THE PROVISIONS OF SAID AGREEMENT, A COPY OF WHICH IS
        ON FILE AT THE PRINCIPAL OFFICE OF SAID CORPORATION. SUCH TRANSFER
        RESTRICTIONS, REPURCHASE RIGHTS AND RIGHT OF FIRST REFUSAL ARE BINDING
        ON TRANSFEREES OF THESE SHARES.

        10. ADJUSTMENTS UPON CHANGES IN CAPITAL STRUCTURE. In the event that the
outstanding shares of Common Stock of the Company are hereafter increased or
decreased or changed into or exchanged for a different number or kind of shares
or other securities of the Company by reason of a



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recapitalization, stock split, combination of shares, reclassification, stock
dividend or other similar change in the capital structure of the Company, then
appropriate adjustment shall be made by the Administrator to the number of
Shares subject to the unexercised portion of this Option and to the Exercise
Price per share, in order to preserve, as nearly as practical, but not to
increase, the benefits of the Optionee under this Option, in accordance with the
provisions of Section 4.2 of the Plan.

        11. CHANGE IN CONTROL. In the event of a Change in Control of the
Company, (i) the vesting of this Option pursuant to Section 2 above shall
automatically accelerate immediately prior to the consummation of such Change in
Control if the Administrator does not take the action described in subitem (C)
of this Section 11, and (ii) the Administrator in its discretion may take one or
more of the following actions: (A) provide for the purchase or exchange of this
Option for an amount of cash or other property having a value equal to the
difference, or spread, between (x) the value of the cash or other property that
the Optionee would have received pursuant to such Change in Control transaction
in exchange for the shares issuable upon exercise of this Option had this Option
been exercised immediately prior to such Change in Control transaction and (y)
the Exercise Price, (B) adjust the terms of this Option in a manner determined
by the Administrator to reflect the Change in Control, (C) cause this Option to
be assumed, or new rights substituted therefor, by another entity, through the
continuance of the Plan and the assumption of this Option, or the substitution
for this Option of a new option of comparable value covering shares of a
successor corporation, with appropriate adjustments as to the number and kind of
shares and Exercise Price, in which event the Plan and this Option, or the new
option substituted therefor, shall continue in the manner and under the terms so
provided, or (D) make such other provision as the Administrator may consider
equitable. If the Administrator does not take any of the forgoing actions, this
Option shall terminate upon the consummation of the Change in Control and the
Administrator shall cause written notice of the proposed transaction to be given
to the Optionee not less than fifteen (15) days prior to the anticipated
effective date of the proposed transaction.

        12. NO EMPLOYMENT CONTRACT CREATED. Neither the granting of this Option
nor the exercise hereof shall be construed as granting to the Optionee any right
with respect to continuance of employment by the Company or any of its
subsidiaries. The right of the Company or any of its subsidiaries to terminate
at will the Optionee's employment at any time (whether by dismissal, discharge
or otherwise), with or without cause, is specifically reserved.

        13. RIGHTS AS SHAREHOLDER. The Optionee (or transferee of this option by
will or by the laws of descent and distribution) shall have no rights as a
shareholder with respect to any Shares covered by this Option until the date of
the issuance of a stock certificate or certificates to him or her for such
Shares, notwithstanding the exercise of this Option.

        14. "MARKET STAND-OFF" AGREEMENT. Optionee agrees that, if requested by
the Company or the managing underwriter of any proposed public offering of the
Company's securities, Optionee will not sell or otherwise transfer or dispose of
any Shares held by Optionee without the prior written consent of the Company or
such underwriter, as the case may be, during such period of time, not to exceed
180 days following the effective date of the registration statement filed by the
Company with respect to such offering, as the Company or the underwriter may
specify.

        15. INTERPRETATION. This Option is granted pursuant to the terms of the
Plan, and shall in all respects be interpreted in accordance therewith. The
Administrator shall interpret and construe this Option and the Plan, and any
action, decision, interpretation or determination made in good faith by the
Administrator shall be final and binding on the Company and the Optionee. As
used in this



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Agreement, the term "Administrator" shall refer to the committee of the Board of
Directors of the Company appointed to administer the Plan, and if no such
committee has been appointed, the term Administrator shall mean the Board of
Directors.

        16. NOTICES. Any notice, demand or request required or permitted to be
given under this Agreement shall be in writing and shall be deemed given when
delivered personally or three (3) days after being deposited in the United
States mail, as certified or registered mail, with postage prepaid, and
addressed, if to the Company, at its principal place of business, Attention: the
Chief Financial Officer, and if to the Optionee, at his or her most recent
address as shown in the employment or stock records of the Company.

        18. GOVERNING LAW. The validity, construction, interpretation, and
effect of this Option shall be governed by and determined in accordance with the
laws of the State of California.

        19. SEVERABILITY. Should any provision or portion of this Agreement be
held to be unenforceable or invalid for any reason, the remaining provisions and
portions of this Agreement shall be unaffected by such holding.

        20. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall be deemed one instrument.

        21. CALIFORNIA CORPORATE SECURITIES LAW. The sale of the shares that are
the subject of this Agreement has not been qualified with the Commissioner of
Corporations of the State of California and the issuance of such shares or the
payment or receipt of any part of the consideration therefor prior to such
qualification is unlawful, unless the sale of such shares is exempt from such
qualification by Section 25100, 25102 or 25105 of the California Corporate
Securities Law of l968, as amended. The rights of all parties to this Agreement
are expressly conditioned upon such qualification being obtained, unless the
sale is so exempt.

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

SONUS PHARMACEUTICALS, INC.            "OPTIONEE"


By:_______________________             __________________________
                                               (Signature)

Its:______________________             __________________________
                                          (Type or print name)



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