8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934 

Date of report (Date of earliest event reported):  March 31, 2008

SKYSTAR BIO-PHARMACEUTICAL COMPANY

(Exact name of registrant as specified in Charter)

Nevada	000-28153	33-0901534
(State or other jurisdiction of incorporation or organization)	(Commission File No.)	(IRS Employer Identification No.)

Rm. 10601, Jiezuo Plaza, No.4, Fenghui Road South,

Gaoxin District, Xian Province, P.R. China

(Address of Principal Executive Offices)

(8629) 8819-3188

 (Issuer Telephone Number)

N/A

 (Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On or about March 31, 2008, Skystar Bio-Pharmaceutical Company (the “Company”) entered into an Amendment and Waiver Agreement (the “Agreement”) with two institutional and accredited investors (the “Purchasers”) who acquired two of the Company’s 8% convertible debentures due February 28, 2009 (the “Debentures”) in a private transaction from the original holders of these Debentures. These Debentures were issued by the Company under the terms of a certain Securities Purchase Agreement dated on February 26, 2007 in a private placement pursuant to Regulation D under the Securities Act of 1933.  The Agreement amends certain terms and conditions of Debentures.  The transaction contemplated by the Agreement closed on April 21, 2008, upon the issuance of shares of the Company’s restricted common stock to the Purchasers pursuant to the terms of the Agreement.

Certain Terms and Conditions of the Debentures

The Debentures bear interest at 8% per year and are convertible into shares of the Company’s common stock at an original conversion price of $1.00 per share (the “Conversion Price”). The Company may require the conversion of the Debentures (“Mandatory Conversion”) provided that (a) certain equity conditions are met, which include, among other things, the effectiveness of a resale registration statement for the shares of common stock underlying the conversion of the Debentures (the “Registration Statement”), and that (b) for the 20 consecutive trading days prior to such election, the daily volume weighted average price exceeds $2.75 (as appropriately adjusted for any stock dividend, stock split, reverse stock split or other similar transaction) and the average trading volume equals or exceeds 45,000 shares of common stock (the “Trading Conditions for Mandatory Conversion”).

The foregoing summary of the Debentures is qualified in its entirety by the form of the Debentures included as an exhibit to the Company’s Current Report on Form 8-K that was filed with the SEC on March 5, 2007, and which are incorporated herein by reference.

The Amendment and Waiver Agreement

The Agreement amends the terms of the Debentures acquired by the Purchasers by: (a) changing the Conversion Price from $1.00 per share to $0.80 per share; (b) deleting the Trading Conditions for Mandatory Conversion; (c) granting the Company the right to Mandatory Conversion at any time, and (d) allowing the Company to designate the date for the Mandatory Conversion.

Additionally, the Agreement is deemed to be: (a) the Company’s notice (the “Conversion Notice”) to require conversion of the entire outstanding principal of the Debentures held by the Participating Purchasers and all accrued but unpaid interest thereto.

Pursuant to the Conversion Notice, we issued an aggregate of 1,227,503 shares of our common stock (the “Shares”) to the Purchasers in reliance on the exemptions for sales of securities not involving a public offering to accredited investors, as set forth in Rule 506 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), and in Section 4(2) of the Securities Act.

Lastly, the Agreement is deemed a waiver of any claim for default under the terms of the Securities Purchase Agreement, the Debentures and a certain Registration Rights Agreement entered into in connection with the Securities Purchase Agreement.

The foregoing summary of the Agreement is qualified in its entirety by the text of the Agreement, a form of which is included as an exhibit hereto and incorporated herein by reference.

Item 3.02 Unregistered Sales of Equity Securities

The disclosures under Item 1.01 are incorporated in this Item 3.02 by reference.

The Shares were issued to accredited investors in a private placement transaction exempt from registration under the Securities Act by virtue of Section 4(2) thereof and pursuant to Rule 506 of Regulation D promulgated thereunder. The Shares have not been registered under the Securities Act or applicable state securities laws and may not be offered or sold in the United States absent registration under the Securities Act and applicable state securities laws or an applicable exemption from registration requirements.

Item 3.03 Material Modification to Rights of Security Holders

The disclosures under Item 1.01 are incorporated in this Item 3.03 by reference.

Item 9.01 Financial Statements and Exhibits

Exhibit Number	Description
10.1	Form of the Amendment and Waiver Agreement dated March 31, 2008.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 23, 2008	Skystar Bio-Pharmaceutical Company (Registrant)
	By:	/s/ Weibing Lu
		Weibing Lu
		Chief Executive Officer

EX-10.1

AMENDMENT AND WAIVER AGREEMENT

THIS AMENDMENT AND WAIVER AGREEMENT (this “Amendment”) is made and entered into this as of the 31st day of March 2008, by and between Skystar Bio-Pharmaceutical Company, a Nevada corporation (the “Company”) on the one hand, [Names of Buyers] (collectively the “Buyers”). Capitalized terms used but not defined herein shall have the meanings set forth in that certain Securities Purchase Agreement, the Registration Rights Agreement, the Convertible Debentures, and the Transfer and Assignment Agreement (defined in the Recitals below).

RECITALS:

WHEREAS, reference is made to that certain Securities Purchase Agreement dated as of February 26, 2007 (the “Securities Purchase Agreement”), by and among the Company and the Buyers, and the Registration Rights Agreement (the “Registration Rights Agreement”) dated as of February 26, 2007 by the same parties, and the 8% Convertible Debentures (the “Convertible Debentures”) issued pursuant thereto (collectively the “Transaction Documents”);

WHEREAS, further reference is made to that certain Convertible Debenture Transfer and Assignment Agreement dated as of March 31, 2008 (the “Transfer and Assignment Agreement”), pursuant to which (a) [Name of First Buyer] purchased from [Name of First Seller] the Company’s 8% Convertible Debenture Series 07-01, Class A, No. 07-01 A-5 (the [“First Note”]) for the purchase price of $304,713.50, and (b) [Name of Second Buyer] purchased from [Name of Second Seller] the Company’s 8% Convertible Debenture Series 07-01, Class A, No. 07-01 A-1 (the [“Second Note”], and with the [First Note], collectively the “Notes”) for the purchase price of $677,289.60;

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual agreements herein contained and for other good and valuable consideration, the parties hereto agree as follows:

A.           AMENDMENT; WAIVER.

(1)           (a)           Company and Buyers acknowledge and agree that the purchase prices paid by Buyers for the [First Note] in the amount of $304,713.50 and for the [Second Note] in the amount of $677,289.60 represent the total accrued and outstanding amount for each such Note as of the Closing Date.

 (b)           With respect to the total accrued and outstanding amount for each of the [First Note] and the [Second Note] as described in Section A(1)(a) above, each Buyer waives any claim for default under the terms of the Securities Purchase Agreement, the Registration Rights Agreement and the Convertible Debentures.

(2)           The Company and Buyers hereby agree to amend the terms of the Notes as described in Section (3) below (the “Amendments”). Buyers are not providing any other consideration for the Amendments and no fees are payable to any broker in connection with such

-1-

Amendments.  Buyers further agree that the Amendments shall not constitute a New Transaction (as that term is defined in the Securities Purchase Agreement).

(3)           Each of the Notes shall have the same terms as the outstanding Convertible Debenture, except as set forth in this Agreement, including without limitation as follows:

(a)  in Section 4(A)(iii), the definition of “Fixed Conversion Price” shall read in its entirety as follows:

“Fixed Conversion Price” means the amount equal to $0.80 (such amount is subject to adjustment as provided herein).

and

(b)  with respect to Section 4(G), (i) each of Sections 4(G)(ii) through (iv) are identified as “Intentionally omitted” and all references to those subsections are deemed deleted; (ii) the Company will have the right to issue a Mandatory Conversion Notice at any time, and (iii) if the Company issues a Mandatory Conversion Notice, the Company may designate any date on or after the date of such Mandatory Conversion Notice as the Mandatory Conversion Date.

(4)           The Company and Buyers hereby agree that this Amendment shall be deemed to be the Company’s issuance of a Mandatory Conversion Notice with respect to all of the outstanding principal, all accrued but unpaid interest and all other amounts owed on each of the Notes, as represented by the purchase prices described in Section A(1)(a) above.  Such conversion shall be effected at the Fixed Conversion Price as specified Section A(3)(a) above, such that the Company shall issue to [Name of First Buyer] 380,891 shares of the Company’s common stock with respect to the conversion of the [First Note], and issue to [Name of Second Buyer] 846,612 shares of the Company’s common stock with respect to the conversion of the [Second Note]. The date designated for such conversion shall be the effective date of this Amendment.

(5)           Except as expressly set forth herein, this Amendment shall not be deemed to be a waiver, amendment or modification of any provisions of the Transaction Documents, or of any right, power or remedy of  Buyers, or constitute a waiver, amendment or modification of any provision of the Transaction Documents (except to the extent herein set forth), or any other document, instrument and/or agreement executed or delivered in connection therewith, in each case whether arising before or after the date hereof or as a result of performance hereunder or thereunder, all of which (except as specified herein) remain in full force and effect.  Except as set forth herein, Buyers reserve all rights, remedies, powers, or privileges.

B.           CONFLICTS.  Except as expressly set forth in this Amendment, the terms and provisions of each of the Transaction Documents shall continue unmodified and in full force and effect.  In the event of any conflict between this Amendment and any one of the Transaction Documents, this Amendment shall control.

-2-

C.           GOVERNING LAW.  This Amendment shall be governed and construed under the laws of the State of New York, and shall be binding on and shall inure to the benefit of the parties and their respective successors and permitted assigns.

D.           COUNTERPARTS.  This Amendment may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument. A facsimile or other electronic transmission of this signed Amendment  shall be legal and binding on all parties hereto.

[Remainder of page left blank intentionally.]

-3-

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first set forth above.

COMPANY:

Skystar Bio-Pharmaceutical Company

By:           _____________________________

Name:

Title:

BUYERS:

[BUYER NAME]

By:           _____________________________

Name:

Title:

[BUYER NAME]

By:           _____________________________

Name:

Title:

-4-