Exhibit 10-S

INDEMNIFICATION AGREEMENT

This Agreement is made as of                     , between A.P. Pharma, Inc., a
Delaware corporation (the “Company”), and                          (the
“Indemnitee”).

RECITALS

Both the Company and Indemnitee recognize that highly competent persons have
become more reluctant to serve publicly-held corporations as directors or in
other capacities unless they are provided with adequate protection through
insurance or adequate indemnification against inordinate risks of claims and
actions against them arising out of their service to and activities on behalf of
the Company.

In recognition of Indemnitee’s need for substantial protection against personal
liability in order to enhance Indemnitee’s continued service to the Company in
an effective manner and Indemnitee’s reliance on the provisions of the Company’s
Certificate of Incorporation, as amended (“Certificate of Incorporation”) and
the Company’s Bylaws (the “Bylaws”) requiring indemnification of the Indemnitee
to the fullest extent permitted by law, and in part to provide Indemnitee with
specific contractual assurance that the protection promised by such Certificate
of Incorporation and Bylaws will be available to Indemnitee (regardless of,
among other things, any amendment to or revocation of such Certificate of
Incorporation or Bylaws or any change in the composition of the Company’s Board
of Directors or acquisition transaction relating to the Company), the Company
wishes to provide in this Agreement for the indemnification of and the advancing
of expenses to Indemnitee to the fullest extent (whether partial or complete)
permitted by law and as set forth in this Agreement.

The Certificate of Incorporation, the Bylaws and the General Corporation Law of
the State of Delaware (“DGCL”) expressly provide that the indemnification
provisions set forth therein are not exclusive and thereby contemplate that
contracts may be entered into between the Company and members of the board of
directors, officers and other persons with respect to indemnification.

It is reasonable, prudent and necessary for the Company contractually to
obligate itself to indemnify, and to advance expenses on behalf of, such persons
to the fullest extent permitted by applicable law so that they will serve or
continue to serve the Company free from undue concern that they will not be so
indemnified.

This Agreement is a supplement to and in furtherance of the Certificate of
Incorporation and Bylaws and any resolutions adopted pursuant thereto and shall
not be deemed a substitute therefor, nor to diminish or abrogate any rights of
Indemnitee thereunder.

--------------------------------------------------------------------------------

AGREEMENT

In consideration of the premises and of Indemnitee agreeing to serve or
continuing to serve the Company directly or, at its request, with another
enterprise, and intending to be legally bound hereby, the parties hereto agree
as follows:

1. Indemnification. (a) Subject to Section 3 of this Agreement, the Company
shall indemnify, to the full extent that it shall have power under applicable
law to do so and in a manner permitted by such law, any person who is made or
threatened to be made a party to or is otherwise involved (as a witness or
otherwise) in any threatened, pending, or completed action, suit, or proceeding,
whether civil, criminal, administrative, or investigative (hereinafter, a
“Proceeding”), by reason of the fact that such person is or was a director or
officer of the Company, or while serving as a director or officer of the
Company, is or was serving at the request of Company as a director, officer,
employee, or agent of another corporation, partnership, joint venture, trust, or
other enterprise, including service with respect to an employee benefit plan
(collectively, “Another Enterprise”) (such person hereinafter, a “Mandatory
Indemnitee”), against expenses (including attorneys’ fees), judgments, fines
(including ERISA excise taxes or penalties) and amounts paid in settlement
actually and reasonably incurred by him or her in connection with such
Proceeding if he or she acted in good faith and in a manner he or she reasonably
believed to be in or not opposed to the best interests of the Company, and, with
respect to any criminal action or proceeding, had no reasonable cause to believe
his or her conduct was unlawful.

(b) The Company may indemnify, to the full extent that it shall have power under
applicable law to do so and in a manner permitted by such law, any person who is
made or threatened to be made a party to or is otherwise involved (as a witness
or otherwise) in any threatened, pending, or completed Proceeding, by reason of
the fact that such person is or was an employee or agent of the Company, or
while not serving as a director or officer of the Company, is or was serving at
the request of the Company as a director, officer, employee, or agent of Another
Enterprise (such person hereinafter, a “Permissive Indemnitee”), against
expenses (including attorneys’ fees), judgments, fines (including ERISA excise
taxes or penalties) and amounts paid in settlement actually and reasonably
incurred by him or her in connection with such Proceeding if he or she acted in
good faith and in a manner he or she reasonably believed to be in or not opposed
to the best interests of the Company, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his or her conduct was
unlawful.

(c) Anything in this Section 1 to the contrary notwithstanding, if a person was
or is a party or was or is threatened to be made a party to any Proceeding by or
in the right of the Company to procure a judgment in its favor by reason of the
fact that such person is or was a director, officer, employee, or agent of the
Company, or is or was serving at the request of the Company as a director,
officer, employee, or agent of Another Enterprise, then the Company shall not
indemnify such person for any judgment, fines, or amounts paid in settlement to
the Company in connection with such Proceeding. The Company shall indemnify any
such person who is a Mandatory Indemnitee, and may indemnify any such person who
is a Permissive Indemnitee, in each case to the full extent that it shall have
power under applicable law to do so and in a manner permitted by such law, and
subject to Section 3 of this Agreement, against

 

-2-

--------------------------------------------------------------------------------

expenses (including attorneys’ fees) actually and reasonably incurred by such
person in connection with the defense or settlement of such Proceeding if he or
she acted in good faith and in a manner he or she reasonably believed to be in
or not opposed to the best interests of the Company; provided, however, that no
indemnification for such expenses shall be made in respect of any claim, issue,
or matter in such Proceeding as to which the person shall have been adjudged
liable to the Company unless (and only to the extent that) the Court of Chancery
of the State of Delaware or the court in which such Proceeding was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses that the Court of Chancery or such other
court shall deem proper.

(d) To the extent that a present or former director or officer of the Company
has been successful on the merits or otherwise in defense of any threatened,
pending, or completed Proceeding referred to in Section 145(a) or (b) of the
General Corporation Law of the State of Delaware, or in defense of any claim,
issue, or matter therein, he or she shall be indemnified against expenses
(including attorneys’ fees) actually and reasonably incurred by him or her in
connection therewith.

(e) The termination of any Proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendre or its equivalent, shall not, of
itself, create a presumption that the person seeking indemnification did not act
in good faith and in a manner he or she reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to any criminal
action or proceeding, had reasonable cause to believe that his or her conduct
was unlawful.

2. Advancement of Expenses. (a) Subject to Section 3 of this Agreement, with
respect to any person who is made or threatened to be made a party to or is
otherwise involved (as a witness or otherwise) in any threatened, pending, or
completed Proceeding, by reason of the fact that such person is or was a
director or officer of the Company or while serving as a director or officer of
the Company, is or was serving at the request of the Company as a director,
officer, employee, or agent of Another Enterprise, the Company shall pay the
expenses (including attorneys’ fees) incurred by such person in defending any
such Proceeding in advance of its final disposition (hereinafter an “advancement
of expenses”); provided, however, that, if required by law, any advancement of
expenses shall be made only upon receipt of an undertaking (hereinafter an
“undertaking”) by such person to repay all amounts advanced if it shall
ultimately be determined by final judicial decision from which there is no
further right to appeal that such person is not entitled to be indemnified for
such expenses under this Agreement or otherwise.

(b) With respect to any person who is made or threatened to be made a party to
or is otherwise involved (as a witness or otherwise) in any threatened, pending,
or completed Proceeding, by reason of the fact that such person is or was an
employee or agent of the Company, or while not serving as a director or officer
of the Company, is or was serving at the request of the Company as a director,
officer, employee, or agent of Another Enterprise, the Company may, in its
discretion and upon such terms and conditions, if any, as the Company deems
appropriate, pay the expenses (including attorneys’ fees) incurred by such
person in defending any such Proceeding in advance of its final disposition.

 

-3-

--------------------------------------------------------------------------------

3. Actions Initiated Against The Company. Anything in Section 1(a) or
Section 2(a) of this Agreement to the contrary notwithstanding, except as
provided in Section 5(b) of this Agreement, with respect to a Proceeding
initiated against the Company by a director or officer of the Company (whether
initiated by such person in such capacity or in any other capacity, including as
a director, officer, employee, or agent of Another Enterprise), the Company
shall not be required to indemnify or to advance expenses (including attorneys’
fees) to such person in connection with prosecuting such Proceeding (or part
thereof) or in defending any counterclaim, cross-claim, affirmative defense, or
like claim of the Company in such Proceeding (or part thereof) unless such
Proceeding was authorized by the Board of Directors of the Company.

4. Contract Rights. With respect to any person who is made or threatened to be
made a party to or is otherwise involved (as a witness or otherwise) in any
threatened, pending, or completed Proceeding, by reason of the fact that such
person is or was a director or officer of the Company, or while serving as a
director or officer of the Company, is or was serving at the request of the
Company as a director, officer, employee, or agent of Another Enterprise, the
rights to indemnification and to the advancement of expenses conferred in
Sections 1(a) and 2(a) of this Agreement shall be contract rights. Any
amendment, repeal, or modification of, or adoption of any provision inconsistent
with, this Agreement (or any provision hereof) shall not adversely affect any
right to indemnification or advancement of expenses granted to any person
pursuant hereto with respect to any act or omission of such person occurring
prior to the time of such amendment, repeal, modification, or adoption
(regardless of whether the Proceeding relating to such acts or omissions is
commenced before or after the time of such amendment, repeal, modification, or
adoption).

5. Claims. (a) If (X) a claim under Section 1(a) of this Agreement with respect
to any right to indemnification is not paid in full by the Company within sixty
days after a written demand has been received by the Company or (Y) a claim
under Section 2(a) of this Agreement with respect to any right to the
advancement of expenses is not paid in full by the Company within twenty days
after a written demand has been received by the Company, then the person seeking
to enforce a right to indemnification or to an advancement of expenses, as the
case may be, may at any time thereafter bring suit against the Company to
recover the unpaid amount of the claim.

(b) If successful in whole or in part in any suit brought pursuant to
Section 5(a) of this Agreement, or in a suit brought by the Company to recover
an advancement of expenses (whether pursuant to the terms of an undertaking or
otherwise), the person seeking to enforce a right to indemnification or an
advancement of expenses hereunder or the person from whom the Company sought to
recover an advancement of expenses, as the case may be, shall be entitled to be
paid by the Company the reasonable expenses (including attorneys’ fees) of
prosecuting or defending such suit.

(c) In any suit brought by a person seeking to enforce a right to
indemnification hereunder (but not a suit brought by a person seeking to enforce
a right to an advancement of expenses hereunder), it shall be a defense that the
person seeking to enforce a right to indemnification has not met any applicable
standard for indemnification under applicable law. With respect to any suit
brought by a person seeking to enforce a right to indemnification or

 

-4-

--------------------------------------------------------------------------------

right to advancement of expenses hereunder or any suit brought by the Company to
recover an advancement of expenses (whether pursuant to the terms of an
undertaking or otherwise), neither (i) the failure of the Company to have made a
determination prior to commencement of such suit that indemnification of such
person is proper in the circumstances because such person has met the applicable
standards of conduct under applicable law, nor (ii) an actual determination by
the Company that such person has not met such applicable standards of conduct,
shall create a presumption that such person has not met the applicable standards
of conduct or, in a case brought by such person seeking to enforce a right to
indemnification, be a defense to such suit.

(d) In any suit brought by a person seeking to enforce a right to
indemnification or to an advancement of expenses hereunder, or by the Company to
recover an advancement of expenses (whether pursuant to the terms of an
undertaking or otherwise), the burden shall be on the Company to prove that the
person seeking to enforce a right to indemnification or to an advancement of
expenses or the person from whom the Company seeks to recover an advancement of
expenses is not entitled to be indemnified, or to such an advancement of
expenses, under this Agreement or otherwise.

6. Determination of Entitlement to Indemnification. Any indemnification required
or permitted under this Agreement (unless ordered by a court) shall be made by
the Company only as authorized in the specific case upon a determination that
indemnification of the present or former director, officer, employee or agent is
proper in the circumstances because he or she has met all applicable standards
of conduct set forth in this Agreement and Section 145 of the General
Corporation Law of the State of Delaware. Such determination shall be made, with
respect to a person who is a director or officer of the Company at the time of
such determination, (i) by a majority vote of the directors who are not parties
to such action, suit or proceeding, even though less than a quorum; (ii) by a
committee of such directors designated by majority vote of such directors, even
though less than a quorum; (iii) if there are no such directors, or if such
directors so direct, by independent legal counsel in a written opinion; or
(iv) by the stockholders. Such determination shall be made, with respect to any
person who is not a director or officer of the Company at the time of such
determination, in the manner determined by the Board of Directors (including in
such manner as may be set forth in any general or specific action of the Board
of Directors applicable to indemnification claims by such person) or in the
manner set forth in any agreement to which such person and the Company are
parties.

7. Non-Exclusive Rights. The indemnification and advancement of expenses
provided herein shall not be deemed exclusive of any other rights to which any
person may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors, or otherwise, both as to action in such person’s
official capacity and as to action in another capacity while holding such
office, and shall continue as to a person who has ceased to be such director,
officer, employee, or agent and shall inure to the benefit of the heirs,
executors, and administrators of such person.

8. Insurance. The Company may purchase and maintain insurance on behalf of any
person who is or was a director, officer, employee, or agent of the Company, or
is or was serving at the request of the Company as a director, officer,
employee, or agent of Another Enterprise against any liability asserted against
such person and incurred by such person in any such capacity, or arising out of
such person’s status as such, whether or not the Company would have the power to
indemnify such person against such liability under the provisions of this
Agreement or otherwise.

 

-5-

--------------------------------------------------------------------------------

9. Severability. If any provision or provisions of this Agreement shall be held
to be invalid, illegal, or unenforceable for any reason whatsoever: (1) the
validity, legality, and enforceability of the remaining provisions of this
Agreement (including, without limitation, each portion of any paragraph or
clause containing any such provision held to be invalid, illegal, or
unenforceable, that is not itself held to be invalid, illegal, or unenforceable)
shall not in any way be affected or impaired thereby; and (2) to the fullest
extent possible, the provisions of this Agreement (including, without
limitation, each such portion of any paragraph or clause containing any such
provision held to be invalid, illegal, or unenforceable) shall be construed so
as to give effect to the intent manifested by the provision held invalid,
illegal, or unenforceable.

10. Miscellaneous. For purposes of this Agreement: (a) references to serving at
the request of the Company as a director or officer of Another Enterprise shall
include any service as a director or officer of the Company that imposes duties
on, or involves services by, such director or officer with respect to an
employee benefit plan; (b) references to serving at the request of the Company
as a employee or agent of Another Enterprise shall include any service as an
employee or agent of the Company that imposes duties on, or involves services
by, such employee or agent with respect to an employee benefit plan; (c) a
person who acted in good faith and in a manner such person reasonably believed
to be in the interest of the participants and beneficiaries of an employee
benefit plan shall be deemed to have acted in a manner not opposed to the best
interests of the Company; and (d) references to a director of Another Enterprise
shall include, in the case of any entity that is not managed by a board of
directors, such other position, such as manager or trustee or member of the
governing body of such entity, that entails responsibility for the management
and direction of such entity’s affairs, including, without limitation, general
partner of any partnership (general or limited) and manager or managing member
of any limited liability company.

11. Amendments, Termination; Waiver; Integration. No supplement, modification,
amendment or termination of this Agreement shall be binding unless executed in
writing by both of the parties hereto. No waiver of any of the provisions of
this Agreement shall be deemed or shall constitute a waiver of any other
provisions hereof (whether or not similar) nor shall such waiver constitute a
continuing waiver. This Agreement supersedes and replaces any prior or
contemporaneous understanding between the parties, whether written or oral,
related to the subject matter hereof, including but not limited to any
indemnification agreement previously entered into between the parties hereto.

12. Contribution. If the indemnification provided in Sections 1 and 3 is
unavailable, then, in respect of any Claim in which the Company is jointly
liable with Indemnitee (or would be if joined in the Claim), the Company shall
contribute to the amount of Expenses, judgments, fines, penalties and amounts
paid in settlement as appropriate to reflect: (i) the relative benefits received
by the Company, on the one hand, and Indemnitee, on the other hand, from the
transaction from which the Claim arose, and (ii) the relative fault of the
Company, on the one hand, and of Indemnitee, on the other, in connection with
the events which resulted in such

 

-6-

--------------------------------------------------------------------------------

Expenses, judgments, fines, penalties and amounts paid in settlement, as well as
any other relevant equitable considerations. The relative fault of the Company,
on the one hand, and of Indemnitee, on the other, shall be determined by
reference to, among other things, the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent the circumstances
resulting in such Expenses and Liabilities. The Company agrees that it would not
be just and equitable if contribution pursuant to this Section 12 were
determined by pro rata allocation or any other method of allocation which does
not take account of the equitable considerations described in this Section 12.

13. Subrogation. In the event of payment under this Agreement, the Company shall
be subrogated to the extent of such payment to all of the rights of recovery of
Indemnitee, who shall execute all papers required and shall do everything that
may be necessary to secure such rights, including the execution of such
documents necessary to enable the Company effectively to bring suit to enforce
such rights.

14. No Duplication of Payments. The Company shall not be liable under this
Agreement to make any payment in connection with any Claim made against
Indemnitee to the extent Indemnitee has otherwise actually received payment
(under insurance policy, Certificate of Incorporation or otherwise) of the
amounts otherwise identifiable hereunder.

15. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors, assigns, including any direct or indirect successor by purchase,
merger, consolidation or otherwise to all or substantially all of the business
and/or assets of the Company, spouse, heirs, and personal and legal
representatives. This Agreement shall continue in effect regardless of whether
Indemnitee continues to serve as a director or officer (or in one of the
capacities enumerated in Section 10(d) hereof) of the Company or of any other
enterprise at the Board of Director’s request.

16. Severability. The provisions of this Agreement shall be severable in the
event that any of the provisions hereof (including any provision within a single
section, paragraph or sentence) are held by a court of competent jurisdiction to
be invalid, void or otherwise unenforceable, and the remaining provisions shall
remain enforceable to the fullest extent permitted by law.

17. Applicable Law. This Agreement and the legal relations among the parties
shall be governed by, and construed and enforced in accordance with, the laws of
the State of Delaware, without regard to its conflict of laws rules.

 

-7-

--------------------------------------------------------------------------------

18. Identical Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original
but all of which together shall constitute one and the same Agreement. Only one
such counterpart signed by the party against whom enforceability is sought needs
to be produced to evidence the existence of this Agreement.

 

 

A.P. PHARMA, INC. By:       President and Chief Executive Officer

  Indemnitee

 

-8-