ARENA PHARMACEUTICALS INC
EX-10.22
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<DESCRIPTION>EX-10.22
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<p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit 10.22</font></b></p>

<p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="right" style="margin:0in 0in .0001pt;text-align:right;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">T2</font></b></p>

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<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">TERMINATION PROTECTION AGREEMENT</font></b></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">AGREEMENT</font></b> effective
December 20, 2002, between Arena Pharmaceuticals, Inc. (the &#147;Company&#148;) and
[NAME] (&#147;Executive&#148;).</p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WHEREAS,
Executive has important management responsibilities and talents which benefit
the Company and its affiliates; and</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WHEREAS, the
Company believes that its best interests are served if Executive is encouraged
to remain with the Company and the Company has determined that Executive&#146;s
ability to perform Executive&#146;s responsibilities and utilize Executive&#146;s talents
for the benefit of the Company, and the Company&#146;s ability to retain Executive
as an employee, will be significantly enhanced if Executive is provided with
fair and reasonable protection from the risks associated with a change in
ownership or control of the Company; and</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">WHEREAS, the
Board has approved and authorized this Agreement at its meeting on November 14,
2002,</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">NOW,
THEREFORE, the Company and Executive hereby agree as follows:</font></p>

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<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Defined Terms</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Unless
otherwise indicated, capitalized terms used in this Agreement which are defined
in Schedule A shall have the meanings set forth in Schedule A.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Effective Date; Term</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Agreement
shall commence on December 20, 2002 (the &#147;Effective Date&#148;) and shall continue
in effect through December 31, 2005; <u>provided</u>, <u>however</u>, the term
of this Agreement shall automatically be extended for one additional year
beyond December 31, 2005 and for successive one year periods thereafter,
unless, not later than January 30 of each calendar year, commencing in 2003 for
the 2006 calendar year (e.g., 2004 for the 2007 calendar year, 2005 for the
2008 calendar year, etc.), the Company shall have given written notice that it
does not wish to extend this Agreement for an additional year, in which event
this Agreement shall continue to be effective until December 31 of the
applicable calendar year; <u>provided</u>, <u>further</u>, that,
notwithstanding any such notice by the Company not to extend, if a Change in
Control shall have occurred during the original or any extended term of this
Agreement, this Agreement shall remain in effect for a period of two (2) years
after such Change in Control.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Change in Control Benefits</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If Executive&#146;s
employment with the Company or its affiliates is terminated at any time within
two (2) years following a Change in Control by the Company or its affiliates
without Cause, or by Executive for Good Reason (the effective date of either
such termination hereafter </font></p>

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<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;">&nbsp;</p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">referred to as the &#147;Termination
Date&#148;), Executive shall be entitled to the benefits provided hereafter in this
Section 3 and as otherwise set forth in this Agreement.&#160; If Executive&#146;s employment is terminated
within one (1) year prior to a Change in Control, and Executive reasonably
demonstrates after such Change in Control that such termination was at the
request or suggestion of any individual or entity who or which ultimately
effects a Change in Control (an &#147;Anticipatory Termination&#148;), this Agreement
shall become effective upon such Change in Control involving such individual or
entity, and Executive&#146;s Termination Date shall be deemed to have occurred
immediately following the Change in Control, and therefore Executive shall be
entitled to the benefits provided hereafter in this Section 3 and as otherwise
set forth in this Agreement.&#160; In the
event that Executive&#146;s employment is terminated as a result of death or
Disability, Executive shall not be entitled to the benefits provided in this
Section 3.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Severance Benefits</u>.&#160; Within five business days after the
Termination Date, the Company shall pay Executive a lump sum amount, in cash,
equal to Executive&#146;s Annual Compensation.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Continued Health Insurance
Coverage</u>.&#160; Until the second
anniversary of the Termination Date, the Company shall, at its expense, provide
Executive with medical and dental insurance at the highest level provided to
Executive during the period beginning immediately prior to the Change in
Control and ending on the Termination Date; <u>provided</u>, <u>however</u>,
that if Executive becomes employed by a new employer, the coverages provided by
the Company pursuant to this sentence shall become secondary to those coverages
provided by the new employer.&#160; In
addition, Executive will be entitled to full COBRA continuation coverage
commencing on the second anniversary of the Termination Date.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Full Vesting of All Stock Options
and Restricted Shares</u>. Notwithstanding any provision to the contrary in the
Amended and Restated Arena Pharmaceuticals, Inc. 2000 Equity Compensation Plan
(the &#147;Option Plan&#148;) or any award agreement under&#160; he Option Plan, (i) any outstanding, unexercisable stock options
or unvested restricted shares shall become fully exercisable and vested as of
the Termination Date and (ii) any stock options shall remain exercisable until
the first anniversary of the Termination Date; <u>provided</u>, <u>however</u>,
that (x) in no event shall any stock option continue to be exercisable after
the expiration of the 10<sup>th</sup> anniversary of the grant date of any such
option and (y) this section shall not restrict the Company&#146;s ability to adjust
stock options pursuant to Section 3(b) of the Option Plan (or any successor
provision under the Option Plan or any similar provision in any other Company
option plan) or to require that optionees surrender their stock option pursuant
to Section 10(b) of the Option Plan (or any successor provision under the
Option Plan or any similar provision in any other Company option plan), so long
as, in any such adjustment or surrender, Executive is treated no less favorably
than any other employee of the Company.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Other Payments And Benefits</u>.&#160; Executive shall also be entitled to receive
any other payments or benefits Executive is entitled to pursuant to the terms
of any Company plans, programs or arrangements (other than severance benefits).</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2</font></p>


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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;">&nbsp;</p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Mitigation</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive
shall not be required to mitigate damages or the amount of any payment provided
for under this Agreement by seeking other employment or otherwise, and
compensation earned from such employment or otherwise shall not reduce the
amounts otherwise payable under this Agreement.&#160; No amounts payable under this Agreement shall be subject to
reduction or offset in respect of any claims which the Company (or any other
person or entity) may have against Executive.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Severance Benefit Cap</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">In the event
that any payment or benefit (the &#147;Payments&#148;) received or to be received by
Executive pursuant to the terms of this Agreement or in connection with
Executive&#146;s termination of employment or contingent upon a change in control of
the Company pursuant to any plan or arrangement or other agreement with the
Company (or any affiliate) would be subject to the excise tax (the &#147;Excise
Tax&#148;) imposed by Section 4999 of the Code, then Executive will receive whichever
of the following provides a greater after-tax benefit to Executive: (i) the
Payments, reduced by the minimum amount necessary so as not to be subject to
the Excise Tax, or (ii) the full amount of the Payments, with Executive liable
for any Excise Tax.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt 1.5in;text-autospace:none;text-indent:-.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u>Employment
Status; No Effect Prior to Change in Control; Termination for Cause</u>.</p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive and
the Company acknowledge and agree that prior to a Change in Control,
Executive&#146;s employment is &#147;at will&#148; and may be terminated at any time, by the
Company or by Executive, with or without Cause, subject to applicable law.&#160; In the event Executive&#146;s employment is
terminated for any reason prior to a Change in Control, other than in the case
of an Anticipatory Termination, Executive shall have no rights to any payments
or benefits under this Agreement and after any such termination, this Agreement
shall be of no further force or effect.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Following a
Change in Control, nothing in this Agreement shall be construed to prevent the
Company from terminating Executive&#146;s employment for Cause.&#160; In the event Executive is terminated for
Cause following a Change in Control, Executive shall have no rights to any
payments or benefits under this Agreement and after such termination, this Agreement
shall be of no further force or effect.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Indemnification; Director&#146;s and
Officer&#146;s Liability Insurance</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Until the
sixth anniversary of the Termination Date and for so long thereafter as any
claim for indemnification asserted on or prior to such date has not been fully
adjudicated (the &#147;Indemnification Period&#148;), the Company shall indemnify,
defend, and hold harmless Executive against all losses, claims, damages, costs,
expenses (including attorneys&#146; fees) or liabilities (including attorneys&#146; fees)
arising out of actions or omissions or alleged actions or omissions which have
occurred on or prior to the Termination Date to the same extent and on the same</font></p>

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<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">terms and conditions (including
with respect to advancement of expenses) as permitted under applicable law and
the Company&#146;s certificate of incorporation and by-laws as in effect immediately
prior to the Change in Control.&#160; In
addition, the Company shall maintain Director&#146;s and Officer&#146;s liability
insurance on behalf of Executive, at the level in effect immediately prior to
the Change in Control, for the Indemnification Period.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Confidential Information</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive
acknowledges that the Proprietary Information and Inventions Agreement
previously entered into by Executive and the Company remains in full force and
effect and survives the termination of his or her employment with the Company; <u>provided</u>
that nothing contained in such agreement or this Section 8 shall prevent
Executive from being employed by a competitor of any of the Company or
utilizing Executive&#146;s general skills, experience, and knowledge, including
those developed while employed by any of the Company or its affiliates.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Disputes</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Any dispute or
controversy arising under or in connection with this Agreement shall be settled
exclusively by arbitration in San Diego, California or, at the option of
Executive, in the county where Executive then resides, in accordance with the
Rules of the American Arbitration Association then in effect, except that
Executive may, at Executive&#146;s option, bring that action in a court of competent
jurisdiction, even if the Company has earlier instituted an action
hereunder.&#160; Judgment may be entered on
an arbitrator&#146;s award relating to this Agreement in any court having
jurisdiction.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">10.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Costs of Proceedings</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Company
shall pay for all costs and expenses of Executive, at least monthly, including
attorneys&#146; fees and disbursements, in connection with any legal proceeding
(including arbitration), whether instituted by the Company or by Executive,
relating to the interpretation or enforcement of any provision of this
Agreement, except that if Executive instituted the proceeding and the judge,
arbitrator or other individual presiding over the proceeding affirmatively
finds that Executive instituted the proceeding in bad faith, then Executive
shall be required to pay all costs and expenses of Executive, including
attorney&#146;s fees and disbursements, and shall not be entitled to
reimbursement.&#160; The Company shall pay
prejudgment interest on any money judgment obtained by Executive as a result of
such a proceeding, calculated at the prime rate of interest as reported in the
Wall Street Journal, as in effect from time to time, from the date that payment
should have been made to Executive under this Agreement.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">11.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Successors And Assigns</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Except as
otherwise provided herein, this Agreement shall be binding upon, inure to the
benefit of and be enforceable by the Company and Executive and their respective
heirs, legal representatives, successors and assigns. &#160;If the Company shall be merged into or </font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4</font></p>


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<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;">&nbsp;</p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">consolidated with another
entity, the provisions of this Agreement shall be binding upon and inure to the
benefit of the entity surviving such merger or resulting from such
consolidation.&#160; The Company shall
require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business or
assets of the Company, by agreement in form and substance satisfactory to
Executive, to expressly assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform it
if no such succession had taken place.&#160;
The provisions of this Section 11 shall continue to apply to each
subsequent employer of Executive in the event of any subsequent merger,
consolidation or transfer of assets of such subsequent employer.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">12.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Withholding</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notwithstanding
the provisions of Sections 4 and 5 hereof, the Company may, to the extent
required by law, withhold applicable federal, state and local income and other
taxes from any payments due to Executive hereunder.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">13.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Applicable Law</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Agreement
shall be governed by and construed in accordance with the laws of the State of
California applicable to contracts made and to be performed therein.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">14.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Entire Agreement</u>.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">This Agreement
constitutes the entire agreement between the parties regarding the subject
matter hereof.&#160; This Agreement may be
changed only by a written agreement executed by the Company and Executive.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">15.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Notice</u>.&#160; Notices and all other communications
provided for in this Agreement shall be in writing and shall be deemed to have
been duly given when personally delivered, delivered by a nationally recognized
overnight delivery service, or sent by certified mail, return receipt
requested, postage prepaid, addressed to the respective addresses last given by
each party to the other, provided that all notices to the Company shall be
directed to the attention of the Board with a copy to the Secretary of the
Company.&#160; All notices and communications
shall be deemed to have been received on the date of delivery thereof or on the
third business day after the mailing thereof, except that notice of change of
address shall be effective only upon receipt.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">16. &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; <u>Severability</u>.&#160; The provisions of this Agreement shall be
deemed severable, and the invalidity or unenforceability of any provision
hereof shall not affect the validity or enforceability of the other provisions
hereof.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5</font></p>


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<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;">&nbsp;</p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">IN WITNESS WHEREOF</font></b>,
the parties have executed this Agreement on the dates set forth below.</p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="13%" valign="top" style="padding:0in .7pt 0in .7pt;width:13.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="28%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:28.48%;">
  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">ARENA
  PHARMACEUTICALS, INC.</font></p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.9%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.1%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="29%" valign="top" style="padding:0in .7pt 0in .7pt;width:29.28%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="13%" valign="top" style="padding:0in .7pt 0in .7pt;width:13.26%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="28%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:28.48%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.9%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.1%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="29%" valign="top" style="padding:0in .7pt 0in .7pt;width:29.28%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="13%" valign="top" style="padding:0in .7pt 0in .7pt;width:13.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="3%" valign="top" style="padding:0in .7pt 0in .7pt;width:3.76%;">
  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="24%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:24.72%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.9%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.1%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="29%" valign="top" style="padding:0in .7pt 0in .7pt;width:29.28%;">
  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Dated:&#160; December 20, 2002</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" valign="top" style="padding:0in .7pt 0in .7pt;width:13.26%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="28%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:28.48%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt 40.0pt;text-autospace:none;text-indent:-10.0pt;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.9%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.1%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="29%" valign="top" style="padding:0in .7pt 0in .7pt;width:29.28%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="13%" valign="top" style="padding:0in .7pt 0in .7pt;width:13.26%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="28%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:28.48%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt 40.0pt;text-autospace:none;text-indent:-10.0pt;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.9%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.1%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="29%" valign="top" style="padding:0in .7pt 0in .7pt;width:29.28%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="13%" valign="top" style="padding:0in .7pt 0in .7pt;width:13.26%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="28%" colspan="2" valign="top" style="padding:0in .7pt 0in .7pt;width:28.48%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.9%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.1%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="29%" valign="top" style="padding:0in .7pt 0in .7pt;width:29.28%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="13%" valign="top" style="padding:0in .7pt 0in .7pt;width:13.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="28%" colspan="2" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in .7pt 0in .7pt;width:28.48%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.9%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.1%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="29%" valign="top" style="padding:0in .7pt 0in .7pt;width:29.28%;">
  <p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Dated:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
  200&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
  </td>
 </tr>
 <tr>
  <td width="13%" valign="top" style="padding:0in .7pt 0in .7pt;width:13.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="28%" colspan="2" valign="top" style="border:none;padding:0in .7pt 0in .7pt;width:28.48%;">
  <p style="margin:0in 0in .0001pt 40.0pt;text-autospace:none;text-indent:-10.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive</font></p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.9%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="14%" valign="top" style="padding:0in .7pt 0in .7pt;width:14.1%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
  <td width="29%" valign="top" style="padding:0in .7pt 0in .7pt;width:29.28%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;text-autospace:none;">&nbsp;</p>
  </td>
 </tr>
 <tr height="0">
  <td width="96" style="border:none;"></td>
  <td width="27" style="border:none;"></td>
  <td width="178" style="border:none;"></td>
  <td width="108" style="border:none;"></td>
  <td width="102" style="border:none;"></td>
  <td width="211" style="border:none;"></td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6</font></p>


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<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;">&nbsp;</p>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font style="font-weight:bold;">Schedule A</font></b></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">CERTAIN DEFINITIONS</font></b></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">As used in
this Agreement, and unless the context requires a different meaning, the
following terms, when capitalized, have the meaning indicated:</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;<u>Annual
Compensation</u>&#148; means the sum of (i) Executive&#146;s annual rate of base salary
in effect on the date of the Change in Control or the Termination Date,
whichever is higher, and (ii)&#160; any bonus
paid or payable to Executive for the year preceding the Change in Control or
the year preceding the Termination Date, whichever is higher.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;<u>Board</u>&#148;
means the Company&#146;s Board of Directors.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;<u>Cause</u>&#148;
shall mean Executive&#146;s termination of employment due to:</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i) the willful and continued failure of Executive to substantially
perform Executive&#146;s duties with the Company (other than any such failure
resulting from incapacity due to physical or mental illness), after a written
demand for substantial performance is delivered to Executive by the Chief
Executive Officer of the Company which specifically identifies the manner in
which the Chief Executive Officer believes that Executive has not substantially
performed Executive&#146;s duties; or</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii) (A) Executive&#146;s conviction of, or plea of guilty or nolo contendere
to, a felony or (B) the willful engaging by Executive in gross misconduct which
is materially and demonstrably injurious to the Company.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;<u>Chan</u>g<u>e
in Control</u>&#148; shall mean any of the following events:</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i) any person or group of persons acting in concert (excluding Company
benefit plans) becoming the beneficial owner of securities of the Company
having at least 30% of the voting power of the Company&#146;s then outstanding
securities (unless the event causing the 30% threshold to be crossed is an
acquisition of voting common securities directly from the Company); or</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii) any merger or other business combination of the Company, any sale
or lease of the Company&#146;s assets or any combination of the foregoing
transactions (the &#147;<u>Transactions</u>&#148;) other than a Transaction immediately
following which the shareholders of the Company immediately prior to the
Transaction own at least 60% of the voting power, directly or indirectly, of
(A) the surviving corporation in any such merger or other business combination;
(B) the purchaser or lessee of the Company&#146;s assets; or (C) both the surviving
corporation and the purchaser or lessee in the event of any combination of
Transactions; or</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-1</font></p>


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</font></div>

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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;">&nbsp;</p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii) within any 24 month period, the persons who were directors
immediately before the beginning of such period (the &#147;<u>Incumbent Directors</u>&#148;)
shall cease to constitute at least a majority of the Board or the board of
directors of a successor to the Company.&#160;
For this purpose, any director who was not a director at the beginning
of such period shall be deemed to be an Incumbent Director if such director was
elected to the Board by, or on the recommendation of or with the approval of,
at least three-quarters of the directors who then qualified as Incumbent
Directors (so long as such director was not nominated by a person who has
expressed an intent to effect a Change in Control or engage in a proxy or other
control contest).</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;<u>Code</u>&#148;
means the Internal Revenue Code of 1986, as amended.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;<u>Company</u>&#148;
means Arena Pharmaceuticals, Inc. and its successors and assigns.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;<u>Disability</u>&#148;
means an illness or injury which prevents Executive from performing his or her
duties, as they existed immediately prior to the illness or injury, on a full
time basis for 180 consecutive business days.</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#147;<u>Good
Reason</u>&#148; means any of the following actions, without Executive&#146;s express
prior written approval, other than due to Executive&#146;s permanent disability or
death:</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)&#160; any reduction in
Executive&#146;s annual base salary;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(ii)&#160; any material reduction in
Executive&#146;s target bonus level or bonus opportunities;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iii)&#160; Executive&#146;s duties,
titles or responsibilities are materially diminished in comparison to the
duties, titles and responsibilities enjoyed by Executive immediately prior to
the Change in Control;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(iv)&#160; the assignment to
Executive of any duties materially inconsistent with his position;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(v)&#160; in the event Executive is a
member of the Board, any failure to elect Executive to or Executive&#146;s removal
from the Board or, if the Company is not publicly-held following a Change in
Control, to the board of directors of the Company&#146;s ultimate publicly-held
parent;</font></p>

<p style="margin:0in 0in .0001pt .5in;text-autospace:none;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vi)&#160; any significant reduction,
in the aggregate, in the employee benefit programs made available to Executive
other than a reduction in such employee benefit programs affecting all
employees of the Company substantially equally;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(vii)&#160; the relocation of
Executive&#146;s principal place of business to a location outside the San Diego,
California metropolitan area; or</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-2</font></p>


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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;text-autospace:none;">&nbsp;</p>

<p style="margin:0in 0in .0001pt .6in;text-autospace:none;text-indent:.4in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(viii)&#160; the failure of the
Company to obtain a satisfactory agreement from any successor to assume and
agree to perform the Agreement, as contemplated in Section 11 of this
Agreement.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Executive&#146;s continued employment
shall not constitute consent to, or a waiver of rights with respect to, any
circumstances constituting Good Reason hereunder.</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A-3</font></p>


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<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Schedule 1</font></b></p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<h2 style="margin:0in 0in .0001pt;page-break-after:auto;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;">Participating
Officers:</font></b></h2>

<h2 style="margin:0in 0in .0001pt;page-break-after:auto;text-autospace:none;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:normal;">&nbsp;</font></b></h2>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-autospace:ideograph-numeric ideograph-other;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Nigel Beeley</p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-autospace:ideograph-numeric ideograph-other;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Paul Maffuid</p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-autospace:ideograph-numeric ideograph-other;text-indent:-.25in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.</font><font size="1" style="font-size:3.0pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Michael Lerner</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;text-autospace:none;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


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