Arena Pharmaceuticals, Inc. (NASDAQ:ARNA) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

Item 5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.

(d)Appointment of Jennifer Jarrett to our Board of Directors

On June 13, 2017, following our 2017 Annual Stockholders Meeting,
or Annual Meeting, our Board of Directors, or Board, increased
the size of the Board from nine directors to ten directors and
appointed Jennifer Jarrett, effective immediately, to serve as a
director until her successor is duly elected and qualified, or
until her earlier death, resignation, or removal. Ms. Jarrett has
also been appointed to serve on the Boards Audit Committee.

Ms. Jarrett has served as the Chief Business Officer and Chief
Financial Officer of Arcus Biosciences, a biotechnology company
developing next generation cancer immunotherapies, since March
2017. Prior to Arcus, Ms. Jarrett was the Chief Financial Officer
of Medivation from April 2016 to October 2016, when it was
acquired by Pfizer. Prior to Medivation, Ms. Jarrett spent 20
years in investment banking, including as Managing Director at
Citigroup from July 2010 to March 2016, where she was responsible
for managing their West Coast life sciences investment banking
practice, and, before that, at Credit Suisse and Donaldson,
Lufkin Jenrette. During her tenure as an investment banker, Ms.
Jarrett covered biotechnology and pharmaceutical companies,
primarily in the Bay Area. In 2014, Ms. Jarrett was named one of
the Most Influential Women in Bay Area Business by San Francisco
Business Times. Ms. Jarrett has a BA in Economics from Dartmouth
College and an MBA from Stanford Graduate School of Business.

There is no arrangement or understanding between Ms. Jarrett and
any other person to which Ms. Jarrett was selected as a director,
and there are no actual or proposed transactions between Ms.
Jarrett or any related person and us that would require
disclosure under Item 404(a) of Regulation S-K.

As a non-employee director, Ms. Jarrett is eligible to receive
compensation and participate in plans of the Company applicable
to the Companys non-employee directors. In accordance with such
plans, on the date of her appointment, Ms. Jarrett was granted an
initial award of options applicable to new directors joining the
Board and an annual award applicable to new and continuing
directors. The initial award of options is to purchase 75,000
shares of our common stock with an exercise price of $1.36 per
share, vesting over three years, and the annual award of options
is to purchase 150,000 shares of our common stock with an
exercise price of $1.36 per share, vesting over one year. The
options were granted under the Arena Pharmaceuticals, Inc. 2017
Long-Term Incentive Plan, which was approved by the Companys
stockholders at the Annual Meeting and is summarized under Item
5.02(e) below. Beginning on July 1, 2017, Ms. Jarrett will be
entitled to receive a retainer of $11,250 per quarter for her
service on our Board, and a retainer of $2,500 per quarter for
her service on our Boards Audit Committee.

We have also entered into our standard form of indemnification
agreement, or Indemnity Agreement, with Ms. Jarrett. The
Indemnity Agreement provides, among other things, that we will
indemnify Ms. Jarrett, under the circumstances and to the extent
provided therein, for certain expenses which she may be required
to pay in connection with certain claims to which she may be made
a party by reason of her service to us as a director, and
otherwise to the fullest extent under applicable law.

(e)Adoption of the Arena Pharmaceuticals, Inc. 2017 Long-Term
Incentive Plan

At the Annual Meeting on June 13, 2017, along with other items
discussed in Item 5.07 below, our stockholders approved our 2017
Long-Term Incentive Plan, or 2017 LTIP.

As of the stockholder approval of the 2017 LTIP, there were
30,086,950 shares of our common stock available for issuance
thereunder. This number may be increased or decreased as
described below, and this number will be adjusted to give effect
to the reverse stock split described under Item 5.03.

The shares under the 2017 LTIP may be granted as incentive stock
options, nonstatutory stock options, stock appreciation rights,
restricted stock awards, restricted stock unit awards and
performance awards. Performance awards may be based on the
achievement of operational, financial, research and development,
collaborative arrangements and other performance metrics provided
under the 2017 LTIP, such as total stockholder return, revenue,
research, development and regulatory achievements and strategic
and operational initiatives.

Upon stockholder approval of the 2017 LTIP, our 2013 Long-Term
Incentive Plan, or 2013 LTIP, was terminated. However,
notwithstanding such termination or the previous termination of
our 2012 Long-Term Incentive Plan, 2009 Long-Term Incentive Plan,
and 2006 Long-Term Incentive Plan, as amended, which together
with the 2013 LTIP are referred to as the Prior Plans, all
outstanding awards under the Prior Plans will continue to be
governed under the terms of the Prior Plans. The number of shares
of common stock authorized for issuance under the 2017 LTIP may
be increased by the number of shares subject to any stock awards
under the Prior Plans that are forfeited, expire or otherwise
terminate without the issuance of such shares and would otherwise
be returned to the share reserve under the Prior Plans but for
their termination and as otherwise provided in the 2017 LTIP.

Some key features of the 2017 LTIP are summarized below. Except
as specified otherwise, all figures are pre-split and subject to
adjustment upon the effectiveness of the reverse stock split
described under Item 5.03.

Shares Available for Awards. The aggregate number of shares of
our common stock that initially may be issued to stock awards
granted under the 2017 LTIP is 30,600,000 shares, less 1 share
for every share that was subject to an option or stock
appreciation right granted under the Companys 2013 LTIP after
March 30, 2017 and prior to the effective date of the 2017 LTIP
and 1.6 shares for every 1 share that was subject to an award
other than an option or stock appreciation right granted under
the Companys 2013 LTIP after March 30, 2017 and prior to the
effective date of the 2017 LTIP. Shares issued to the exercise of
stock options and stock appreciation rights granted under the
2017 LTIP reduce the available number of shares by 1 share for
every share issued while awards other than stock options and
stock appreciation rights granted under the 2017 LTIP reduce the
available number of shares by 1.6 shares for every share issued.

In addition, shares that, after March 30, 2017, are released from
awards granted under the Prior Plans because the awards expire,
are forfeited or are settled for cash will increase the number of
shares available under the 2017 LTIP by 1 share for each share
released from a stock option or stock appreciation right and by
1.6 shares for each share released from a restricted stock award
or restricted stock unit award.

The following shares shall not be added to the number of shares
available under the 2017 LTIP: (a) shares tendered by the
participant or withheld by us in payment of the purchase price of
an option granted under the 2017 LTIP or the Prior Plans, or to
satisfy any tax withholding obligation with respect to any award
granted under the 2017 LTIP or the Prior Plans, (b) shares
subject to a stock appreciation right granted under the 2017 LTIP
or the Prior Plans that are not issued in connection with the
stock settlement of the stock appreciation right on exercise
thereof, and (c) shares reacquired by us on the open market or
otherwise using cash proceeds from the exercise of options
granted under the 2017 LTIP or the Prior Plans.

Shares issued under awards granted in assumption of or in
substitution for awards previously granted by a company acquired
by us or with which we or any subsidiary combines, will not
reduce the shares authorized for issuance under the 2017 LTIP.
Shares issued under the 2017 LTIP may consist of authorized and
unissued shares, treasury shares or shares purchased in the open
market or otherwise. The Company will keep available at all times
the number of Shares reasonably required to satisfy
then-outstanding stock awards.

Eligibility; Awards to be Granted to Certain Individuals and
Groups. Awards may be granted under the 2017 LTIP to any
employee, non-employee member of our Board of Directors,
consultant or advisor who provides us service, except for
incentive stock options, which may be granted only to our
employees or employees of our subsidiaries.

Certain Limits on Shares Subject to Awards. The 2017 LTIP
provides that, subject to adjustment as provided in the plan, no
participant may be granted (a) options or stock appreciation
rights during any calendar year with respect to more than
8,000,000 shares of common stock or (b) restricted stock awards,
performance awards and/or restricted stock unit awards during any
calendar year that are denominated in shares of common stock and
are intended to comply with the performance-based exception under
Code Section 162(m) under which more than 8,000,000 shares of
common stock may be earned. Shares subject to a cancelled award
continue to count against the applicable limit. In addition to
the foregoing, during any calendar year no participant may be
granted performance awards that are intended to comply with the
performance-based exception under Code Section 162(m) and are
denominated in cash under which more than $10,000,000 may be
earned. The dollar value of a cancelled award will continue to
count against the $10,000,000 limit.

The aggregate maximum number of shares of common stock that may
be issued under the 2017 LTIP to the exercise of incentive stock
options is 30,600,000 shares, subject to adjustment for certain
corporate events, including mergers and stock splits.

Administration. The 2017 LTIP will be administered by the
Compensation Committee of the Board. The Compensation Committee
has the authority to select the participants who will receive
awards under the 2017 LTIP, to determine the type and terms of
the awards, and to interpret and administer the 2017 LTIP. The
Compensation Committee may delegate the right to make grants and
otherwise take action on the Compensation Committees behalf under
the 2017 LTIP to a committee of one or more directors and, to the
extent permitted by law and NASDAQ Stock Market rules and
regulation, to an executive officer or a committee of executive
officers the right to grant awards to employees who are not our
executive officers (subject to the limitation on the total number
of shares that may be subject to such awards as specified by the
Compensation Committee).

Exercise Price. The exercise price of options granted under the
2017 LTIP is determined by the Compensation Committee at the time
the options are granted. The exercise price of an option may not
be less than 50% of the fair market value of the common stock on
the date such option is granted, except in the case of substitute
awards granted in connection with an acquisition; provided,
however, that in the case of an incentive stock option granted to
a participant who, at the time of the grant, owns stock
representing more than 10% of the voting power of all of our
classes of stock, the option price per share will be no less than
110% of the fair market value of one share of our common stock on
the date of grant. The fair market value of the common stock is
generally determined with reference to the closing price for the
common stock on the NASDAQ Stock Market on the date the option is
granted (or if there was no reported closing price on such date,
on the last preceding date on which the closing price was
reported).

No Repricing. The 2017 LTIP prohibits option and stock
appreciation right repricings (other than to reflect stock
splits, spin-offs or other corporate events described under
Adjustments upon Changes in Capitalization below) unless
stockholder approval is obtained. For purposes of the 2017 LTIP,
a repricing means a reduction in the exercise price of an option
or the grant price of a stock appreciation right, the
cancellation of an option or stock appreciation right in exchange
for cash or another award (except for awards granted in
assumption of or in substitution for awards previously granted by
a company acquired by us or with which we combine) under the 2017
LTIP if the exercise price of the cancelled option or grant price
of the cancelled stock appreciation right is greater than the
fair market value of the common stock, or any other action with
respect to an option or stock appreciation right that may be
treated as a repricing under the NASDAQ Stock Market rules.

Adjustments upon Changes in Capitalization. In the event of any
merger, reorganization, consolidation, recapitalization, dividend
or distribution (whether in cash, shares or other property, other
than a regular cash dividend), stock split, reverse stock split,
spin-off or similar transaction or other change in our corporate
structure affecting our common stock or the value thereof,
appropriate adjustments shall be made, in the discretion of the
Compensation Committee, in the number and class of shares of
stock subject to the 2017 LTIP, the number and class of shares of
awards outstanding under the 2017 LTIP, the limits on the number
of awards that any person may receive and the exercise price of
any outstanding option or stock appreciation right.

Change in Control. The Compensation Committee may, in its
discretion, determine that, upon our change in control (as
defined in the 2017 LTIP or otherwise defined in the agreement
evidencing an award), options and stock appreciation rights
outstanding as of the date of the change in control shall be
cancelled and terminated without payment therefor if the fair
market value of one share of our common stock as of the date of
the change in control is less than the per share option exercise
price or stock appreciation right grant price.

To the extent provided in an award agreement, in the event of a
change in control in which the successor company assumes or
substitutes for an option, stock appreciation right, restricted
stock award or restricted stock unit award (or in which we are
the ultimate parent corporation and continue the award), if a
participants employment with such successor company (or us) or a
subsidiary thereof terminates within the period following such
change in control set forth in the award agreement (or prior if
applicable) under the circumstances set forth in the award
agreement, each award held by such participant at the time of
such termination of employment will be fully vested, and options
and stock appreciation rights may be exercised during the period
following such termination set forth in the award agreement. If
the successor company does not assume or substitute for such
outstanding awards held by participants at the time of the change
in control, then unless otherwise provided in the award
agreement, the awards will become fully vested immediately prior
to the change in control and will terminate immediately after the
change in control.

The Compensation Committee, in its discretion, may also determine
that, upon the occurrence of a change in control, each option and
stock appreciation right outstanding shall terminate within a
specified number of days after notice to the participant, and/or
that each participant shall receive, with respect to each share
of common stock subject to such option or stock appreciation
right, an amount equal to the excess, if any, of the fair market
value of such share immediately prior to the occurrence of such
change in control over the exercise price per share of such
option and/or stock appreciation right; such amount to be payable
in cash, in one or more kinds of stock or property, or in a
combination thereof, as the Compensation Committee, in its
discretion, will determine.

Amendment and Termination of the 2017 LTIP. Our Board of
Directors may alter, amend, suspend or terminate the 2017 LTIP,
from time to time as it deems advisable, subject to any
requirement of applicable law or the rules and regulations of the
NASDAQ Stock Market for stockholder approval. However, our Board
of Directors may not amend the 2017 LTIP without stockholder
approval to increase the number of shares available for awards
under the 2017 LTIP, expand the types of awards available under
the 2017 LTIP, materially expand the class of persons eligible to
participate in the 2017 LTIP, permit the grant of options or
stock appreciation rights with an exercise or grant price of less
than 50% of fair market value on the date of grant (except for
substitute awards granted in connection with an acquisition),
increase the maximum term of the plan or of any options and stock
appreciation rights, increase the limits on shares subject to
awards or the dollar value payable with respect to performance
awards, or take any action with respect to an option or stock
appreciation right that may be treated as a repricing under the
NASDAQ Stock Market rules (including a reduction in the exercise
price of an option or stock appreciation right or the exchange of
an option or stock appreciation right for cash or another award
if the option or grant price is greater than the fair market
value of the common stock). No such action by our Board of
Directors may alter or impair any award previously granted under
the 2017 LTIP without the

written consent of the participant. The 2017 LTIP will expire on
the 10th anniversary of its effective date, except with respect
to awards then outstanding, and no further awards may be granted
thereafter.

Item 5.03 Amendments to Articles of Incorporation or Bylaws;
Change in Fiscal Year.

(a)Amendment of Articles of Incorporation to Effect Reverse Stock
Split

As described in Item 5.07 below, on June 13, 2017, our
stockholders approved (i) a series of alternate amendments to our
Amended and Restated Certificate of Incorporation to effect, at
the option of the Board, a reverse split of our common stock at a
ratio ranging from one-for-six (1:6) to one-for-ten (1:10),
inclusive, with the effectiveness of one of such amendments and
the abandonment of the other amendments, or the abandonment of
all amendments, to be determined by the Board prior to the date
of our 2018 Annual Meeting of Stockholders, and (ii) a series of
alternate amendments to our Amended and Restated Certificate of
Incorporation to effect a reduction in the total number of
authorized shares of our common stock in the event that such a
reverse split was implemented.

On June 14, 2017, the Company filed a Certificate of Amendment,
referred to as the Amendment, with the Secretary of State of the
State of Delaware to amend the Companys Fifth Amended and
Restated Certificate of Incorporation (a) to effect a one-for-ten
reverse stock split of its outstanding common stock, and (b) to
effect a reduction in the number of authorized shares of common
stock from 367,500,000 shares to 73,500,000 shares. The Amendment
will be effective at 5:00 p.m. Eastern Time on June 16, 2017. A
series of alternate amendments to effect a reverse stock split
and a concurrent authorized common share reduction were approved
by the Companys stockholders at its Annual Meeting of
Stockholders held on June 13, 2017, and the specific one-for-ten
reverse split ratio and corresponding authorized common share
reduction to 73,500,000 shares were subsequently approved by the
Companys Board of Directors on June 13, 2017.

The Amendment provides that, at the effective time of the
Amendment, (a) every ten shares of the Companys issued and
outstanding common stock will automatically be combined into one
issued and outstanding share of common stock, without any change
in par value per share, and (b) the number of authorized shares
of common stock will be reduced to 73,500,000 shares. The reverse
stock split will affect all shares of the Companys common stock
outstanding immediately prior to the effective time of the
Amendment. As a result of the reverse stock split, proportionate
adjustments will be made to the per share exercise price and/or
the number of shares issuable upon the exercise or vesting of all
stock options, restricted stock units and warrants issued by the
Company and outstanding immediately prior to the effective time
of the Amendment, which will result in a proportionate decrease
in the number of shares of the Companys common stock reserved for
issuance upon exercise or vesting of such stock options,
restricted stock units and warrants, and, in the case of stock
options and warrants, a proportionate increase in the exercise
price of all such stock options and warrants. In addition, the
number of shares reserved for issuance under the Companys equity
compensation plans immediately prior to the effective time of the
Amendment will be reduced proportionately.

No fractional shares will be issued as a result of the reverse
stock split. Stockholders of record who would otherwise be
entitled to receive a fractional share will receive a cash
payment in lieu thereof. The reverse stock split will affect all
stockholders proportionately and will not affect any stockholders
percentage ownership of the Companys common stock (except to the
extent that the reverse stock split results in any stockholder
owning only a fractional share).

The Companys common stock will begin trading on The NASDAQ Global
Select Market on a split-adjusted basis when the market opens on
June 19, 2017. The new CUSIP number for the Companys common stock
following the reverse stock split is 040047 607.

The foregoing description is qualified in its entirety by the
Amendment, which is attached as Exhibit 3.1 to this Current
Report on Form 8-K and is incorporated herein by reference.

Item 5.07 Submission of Matters to a Vote of Security Holders.

We held our Annual Meeting on June 13, 2017. At the Annual
Meeting, our stockholders:

The tables below set forth the results of the vote of our
stockholders for the annual meeting.

Proposal 1: The election of directors

Proposal 2: The approval, on a non-binding, advisory basis, of
the compensation of our named executive officers, as disclosed in
the proxy statement for the annual meeting

Proposal 3: The indication, on a non-binding, advisory basis, the
preferred frequency of stockholder advisory votes on the
compensation of our named executive officers

Based on these results, and consistent with the recommendation of
our Board of Directors, we have determined that we will hold a
non-binding, advisory vote on the compensation of our named
executive officers every year.

Proposal 4: The approval of a series of alternate amendments to
our Amended and Restated Certificate of Incorporation to effect,
at the option of the Board of Directors, a reverse split of our
common stock

Proposal 5: The approval of a series of alternate amendments to
our Amended and Restated Certificate of Incorporation to effect,
if Proposal 4 is implemented, a reduction in the total number of
authorized shares of our common stock

Proposal 6: The approval of the Arena Pharmaceuticals, Inc. 2017
Long-Term Incentive Plan

Proposal 7: Ratification of the Appointment of KPMG LLP

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Forward-Looking Statements

Statements in this report on Form 8-K that are not statements of
historical fact are forward-looking statements, which involve a
number of risks and uncertainties. Such statements include
statements about the reverse stock split and can be identified by
using the word will. For such statements, we claim the protection
of the Private Securities Litigation Reform Act of 1995. Actual
events or results may differ materially from our expectations.
Factors that could cause actual results to differ materially from
the forward-looking statements include delays in regulatory
approvals and those disclosed in our filings with the Securities
and Exchange Commission. These forward-looking statements
represent our judgment as of the time of this report on Form 8-K.
We disclaim any intent or obligation to update these
forward-looking statements, other than as may be required under
applicable law.

About Arena Pharmaceuticals, Inc. (NASDAQ:ARNA)

Arena Pharmaceuticals, Inc. is a biopharmaceutical company focused on discovering, developing and commercializing small molecule drugs that target G protein-coupled receptors (GPCRs). The Company’s drug, Lorcaserin, is approved for marketing in the United States and South Korea for the indication of weight management, and is being commercialized under the brand name, BELVIQ. The Company’s drug candidates in clinical development include APD334 for autoimmune diseases, ralinepag for vascular diseases and APD371 for pain. APD334 is an orally available modulator of the sphingosine 1-phosphate subtype 1 (S1P1) receptor intended for the treatment of multiple sclerosis, psoriasis, inflammatory bowel diseases and rheumatoid arthritis. The Company’s programs under collaboration include nelotanserin for dementia-associated psychosis, temanogrel for thrombotic diseases and an undisclosed orphan GPCR for central nervous system indication(s).