EXHIBIT 10.3

FIRST AMENDMENT TO
RIGHTS AGREEMENT
BETWEEN
ORCHID BIOSCIENCES, INC.
AND
AMERICAN STOCK TRANSFER & TRUST COMPANY

This First Amendment to Rights Agreement (the “Amendment”) is made as of this
31st day of March, 2003 by and between Orchid BioSciences, Inc., a Delaware
corporation (the “Company”), and American Stock Transfer & Trust Company as
rights agent (the “Rights Agent”). Capitalized terms used but not defined herein
shall have the meanings given to such terms in the Purchase Agreement (as
defined below).

WHEREAS, the Company has entered into a Securities Purchase Agreement dated as
of March 31, 2003 by and among the Company and the Purchasers set forth on the
execution pages thereof (the “Purchase Agreement”), pursuant to which the
Company will issue and sell to the Purchasers units, each consisting of (i) one
share of the Company’s Series A Convertible Preferred Stock, par value $.001 per
share (the “Preferred Shares”), convertible into 22,222.22 shares of the
Company’s common stock, par value $.001 per share (the “Common Stock”), and (ii)
a warrant (the “Warrants”) to acquire 6,666.67 shares of Common Stock;

WHEREAS, the Company and the Rights Agent are parties to a Rights Agreement
dated as of July 27, 2001 (the “Rights Agreement”); and

WHEREAS, the parties desire to amend the Rights Agreement in connection with the
execution and delivery of the Purchase Agreement, the issuance and sale of the
Preferred Shares and Warrants and the issuance of Common Stock upon the
conversion of the Preferred Shares and the exercise of the Warrants, and the
Company and the Rights Agent have executed and delivered this Amendment.

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
herein set forth, the parties hereby agree as follows:

1.     The definition of “Acquiring Person” set forth in Section 1(a) of the
Rights Agreement is hereby amended by adding the following sentence to the end
of such definition:

“Notwithstanding the foregoing, none of SDS Capital Partners, SDS Merchant Fund,
LP, BayStar Capital II, L.P., DMG Legacy Fund LLC, DMG Legacy Institutional Fund
LLC or DMG Legacy International Ltd., or any affiliate thereof (each a
“Preferred Purchaser” and collectively, the “Preferred Purchasers”) shall be or
become an Acquiring Person by reason of (i) the execution or delivery of the
Securities Purchase Agreement dated as of March 31, 2003 by and among the
Company and the Purchasers set forth on the execution pages thereof (the
“Purchase Agreement”), (ii) the purchase of shares of Series A Convertible
Preferred Stock, par value $.001 per share, of the Company (the “Preferred
Shares”) pursuant to the terms and conditions of the Purchase Agreement, (iii)
the purchase of warrants to purchase shares of Common Stock of the Company (the
“Warrants”) pursuant to the terms and conditions of the Purchase Agreement, (iv)
the issuance of shares of Common Stock of the Company upon the conversion of
Preferred Shares purchased pursuant to the terms and conditions of the Purchase
Agreement, (v) the issuance of shares of Common Stock of the Company as a
dividend on the Preferred Shares purchased pursuant to the terms and conditions
of the Purchase Agreement or (vi) the issuance of shares of Common Stock of the
Company upon the exercise of Warrants purchased pursuant to the terms and
conditions of the Purchase Agreement.”

 

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2.     The definition of “Stock Acquisition Date” set forth in Section 1(nn) of
the Rights Agreement is hereby amended by adding the following sentence to the
end of such definition:

“Notwithstanding anything else set forth in this Agreement, a Stock Acquisition
Date shall not be deemed to have occurred by reason of (i) the execution or
delivery of the Purchase Agreement by each of the Preferred Purchasers, (ii) the
purchase of shares of Preferred Shares by each of the Preferred Purchasers
pursuant to the terms and conditions of the Purchase Agreement, (iii) the
purchase of Warrants by each of the Preferred Purchasers pursuant to the terms
and conditions of the Purchase Agreement, (iv) the issuance of shares of Common
Stock of the Company to each of the Preferred Purchasers upon the conversion of
Preferred Shares purchased pursuant to the terms and conditions of the Purchase
Agreement, (v) the issuance of shares of Common Stock of the Company to each of
the Preferred Purchasers as a dividend on the Preferred Shares purchased
pursuant to the terms and conditions of the Purchase Agreement or (vi) the
issuance of shares of Common Stock of the Company to each of the Preferred
Purchasers upon the exercise of Warrants purchased pursuant to the terms and
conditions of the Purchase Agreement.”

3.     The definition of “Triggering Event” set forth in Section 1(rr) of the
Rights Agreement is hereby amended by adding the following sentence to the end
of such definition:

“Notwithstanding anything else set forth in this Agreement, a Triggering Event
shall not be deemed to have occurred by reason of (i) the execution or delivery
of the Purchase Agreement by each of the Preferred Purchasers, (ii) the purchase
of shares of Preferred Shares by each of the Preferred Purchasers pursuant to
the terms and conditions of the Purchase Agreement, (iii) the purchase of
Warrants by each of the Preferred Purchasers pursuant to the terms and
conditions of the Purchase Agreement, (iv) the issuance of shares of Common
Stock of the Company to each of the Preferred Purchasers upon the conversion of
Preferred Shares purchased pursuant to the terms and conditions of the Purchase
Agreement, (v) the issuance of shares of Common Stock of the Company to each of
the Preferred Purchasers as a dividend on the Preferred Shares purchased
pursuant to the terms and conditions of the Purchase Agreement or (vi) the
issuance of shares of Common Stock of the Company to each of the Preferred
Purchasers upon the exercise of Warrants purchased pursuant to the terms and
conditions of the Purchase Agreement.”

4.     Section 3(a) of the Rights Agreement shall be amended by adding the
following sentence to the end thereof:

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“Notwithstanding anything else set forth in this Agreement, no Distribution Date
shall be deemed to have occurred by reason of (i) the execution or delivery of
the Purchase Agreement by each of the Preferred Purchasers, (ii) the purchase of
shares of Preferred Shares by each of the Preferred Purchasers pursuant to the
terms and conditions of the Purchase Agreement, (iii) the purchase of Warrants
by each of the Preferred Purchasers pursuant to the terms and conditions of the
Purchase Agreement, (iv) the issuance of shares of Common Stock of the Company
to each of the Preferred Purchasers upon the conversion of Preferred Shares
purchased pursuant to the terms and conditions of the Purchase Agreement, (v)
the issuance of shares of Common Stock of the Company to each of the Preferred
Purchasers as a dividend on the Preferred Shares purchased pursuant to the terms
and conditions of the Purchase Agreement or (vi) the issuance of shares of
Common Stock of the Company to each of the Preferred Purchasers upon the
exercise of Warrants purchased pursuant to the terms and conditions of the
Purchase Agreement.”

5.     The Rights Agreement, as amended by this Amendment, shall remain in full
force and effect in accordance with its terms, until terminated as provided in
the Rights Agreement as so amended.

6.     This Amendment shall be deemed to be a contract made 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. This Amendment may be executed in any
number of counterparts, each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together constitute
one and the same instrument. If any term, provision, covenant or restriction of
this Amendment is held by a court of competent jurisdiction or other authority
to be invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Amendment shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.

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IN WITNESS WHEREOF, the parties herein have caused this Amendment to be duly
executed and attested, all as of the date and year first above written.

Attest: ORCHID BIOSCIENCES, INC.     By: /s/ Brian P. Keane   By: /s/ Andrew P.
Savadelis    

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  Name:  Brian P. Keane Name:  Andrew P. Savadelis Title:  Counsel Title:  Sr.
Vice President & CFO     Attest:
AMERICAN STOCK TRANSFER &
TRUST COMPANY
    By: /s/ Susan Silber By: /s/ Herbert J. Lemmer  

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  Name: Susan Silber Name: Herbert J. Lemmer Title: Assistant Secretary Title:
Vice President

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