This Amendment dated as of October 1, 2008 (Amendment) to the Preferred Shares Rights Agreement (Agreement), dated as of December 18, 2006, is between A.P. Pharma, Inc., a Delaware corporation (the Company), and Computershare Trust Company, N.A. (the Rights Agent).
Pursuant to Section 27 of the Agreement, this Amendment is being executed by the Company and the Rights Agent for the purpose of amending the Agreement as set forth below:
The Agreement is hereby amended as follows:
|1.||Section 1(a) shall be amended by inserting the following at the end of Section 1(a):|
Notwithstanding the foregoing or any provision to the contrary in this Agreement, none of Tang Capital Partners LP, or its Affiliates or Associates (the Tang Entities) is an Acquiring Person pursuant to this Agreement, unless such Person acquires Beneficial Ownership of 30% or more of the then outstanding shares of Common Stock.
|2.||Section 1(h) shall be amended by inserting the following at the end of Section 1(h):|
Notwithstanding the foregoing or any provision to the contrary in this Agreement, a Distribution Date shall not occur solely by reason of the Tang Entities acquiring Beneficial Ownership of more than 20% but less than 30% of the then outstanding shares of Common Stock.
3. This Amendment shall be deemed to be entered into under the laws of the State of Delaware and for all purposes shall be governed by and construed in accordance with the laws of such State applicable to contracts to be made and performed entirely within such State.
4. This Amendment may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.
5. As amended hereby, the Agreement shall remain in full force and effect.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment to Rights Agreement as of the date and year first above written.
A.P. PHARMA, INC.
By: /s/ Gregory Turnbull
Name: Gregory Turnbull
Title: Chief Financial Officer
COMPUTERSHARE TRUST COMPANY
AS RIGHTS AGENT
By: /s/ Katherine Anderson
Signature of Authorized Signatory