Document:

Exhibit 4.3

 

AMENDMENT NO. 2 TO RIGHTS AGREEMENT

This Amendment No. 2, dated as of November 16, 2006 (the
“Amendment”), is between Arena
Pharmaceuticals, Inc., a Delaware corporation (the “Company”),
and Computershare Trust Company, Inc., as Rights Agent (the “Rights Agent”).

WHEREAS, the Company and the Rights Agent are
parties to a Rights Agreement dated as of October 30, 2002, as amended on
December 24, 2003 (as so amended, the “Rights
Agreement”); and

WHEREAS, pursuant to Section 27 of the Rights Agreement,
the Company and the Rights Agent desire to amend the Rights Agreement as set
forth below.

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

Section 1.  Amendments to
Section 1.

(a)       The
definition of “Acquiring Person” in Section 1(a)
of the Rights Agreement is hereby amended in its entirety to read as follows:

“(a)  “Acquiring
Person” shall mean any Person (as such term is hereinafter defined)
who or which, together with all Affiliates and Associates (as such terms are
hereinafter defined) of such Person, shall be the Beneficial Owner (as such
term is hereinafter defined) of 15% or more of the Common Shares of the Company
then outstanding, but shall not include the Company, any Subsidiary (as such
term is hereinafter defined) of the Company, any employee benefit plan of the
Company or any Subsidiary of the Company, or any entity holding Common Shares
of the Company for or pursuant to the terms of any such plan.  Notwithstanding
the foregoing, (i) following the Closing Date (as such term is hereinafter
defined), no Purchaser (as such term is hereinafter defined) shall be deemed an
Acquiring Person by virtue of such Purchaser being the Beneficial Owner of any
Securities (as such term is hereinafter defined) acquired pursuant to the terms
of any of the Transaction Documents (as such term is hereinafter defined); provided that if any Purchaser acquires Beneficial Ownership
of any Common Shares of the Company other than pursuant to the terms of any of
the Transaction Documents and, immediately following such acquisition, such
Purchaser Beneficially Owns 15% or more of the Common Shares of the Company
then outstanding (including by virtue of its Beneficial Ownership of
Securities), such Purchaser shall be deemed to have become an Acquiring Person
as a result of such acquisition, and (ii) no Person (including any Purchaser)
shall be or become an “Acquiring Person” as the result of an acquisition of
Common Shares of the Company by the Company which, by reducing the number of
shares outstanding, increases the proportionate number of shares beneficially
owned by such Person to 15% or more of the Common Shares of the Company then
outstanding; provided, however, that if a
Person shall be or become the Beneficial

 
  

Owner of 15% or more of the Common Shares of
the Company then outstanding by reason of share purchases by the Company and
shall thereafter become the Beneficial Owner of any additional Common Shares of
the Company (other than, in the case of any Purchaser, pursuant to the terms of
any Transaction Documents), then such Person shall be deemed to be an “Acquiring
Person.”  Notwithstanding the foregoing, if the Board of Directors of the
Company determines in good faith that a Person who would otherwise be an “Acquiring
Person,” as defined pursuant to the foregoing provisions of this paragraph (a),
has become such inadvertently, and such Person divests as promptly as
practicable a sufficient number of Common Shares of the Company so that such
Person would no longer be an “Acquiring Person,” as defined pursuant to the
foregoing provisions of this paragraph (a), then such Person shall not be
deemed to be an “Acquiring Person” for any purposes of this Agreement.”

(b)       The
definitions of “BVF” and “BVF
Percentage” in Sections 1(e) and (f) of the Rights Agreement are
hereby deleted in their entirety.

(c)       The definition
of “Securities Purchase Agreement” in
Section 1(t) of the Rights Agreement is hereby amended in its entirety to
read as follows:

“(t)          Securities Purchase
Agreement” shall mean the Securities Purchase Agreement dated as of
December 24, 2003, among the Company and the purchasers indicated on the
signature pages thereto (such Persons, together with their permitted assigns
under the Securities Purchase Agreement, are referred to herein as the “Purchasers”); capitalized terms used
herein without definition shall have the meanings ascribed to such terms in the
Securities Purchase Agreement.”

Section 2.       Amendment
to Section 3(c).  The first sentence
of the legend in Section 3(c) of the Rights Agreement is hereby amended in its
entirety to read as follows:

“This certificate also evidences and entitles the
holder hereof to certain rights as set forth in a Rights Agreement between
Arena Pharmaceuticals, Inc. (the “Company”) and
Computershare Trust Company, Inc. (the “Rights Agent”)
dated as of October 30, 2002, as amended on December 24, 2003
and November 16, 2006 (as so amended, the “Rights
Agreement”), the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal executive offices of
the Company.”

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Section 3.       Amendment to
Section 26.  The address and
person to whom a copy of the notice or demand given or made to or on the
Company is hereby amended in its entirety to read as follows:

“Milbank, Tweed, Hadley & McCloy LLP

One Chase Manhattan Plaza

New York, New York 10005

Fax No:  (212) 822-5680

Attention:
Robert S. Reder, Esq.’’

Section 4.       Amendment
to Exhibit B.  The first sentence of
the first paragraph of Exhibit B of the Rights Agreement is hereby amended
in its entirety to read as follows:

“This certifies that
                               ,
or registered assigns, is the registered owner of the number of Rights set
forth above, each of which entitles the owner thereof, subject to the terms,
provisions and conditions of the Rights Agreement, dated as of October 30,
2002, as amended on December 24, 2003 and November 16, 2006 (as so
amended, the “Rights Agreement”), between Arena
Pharmaceuticals, Inc., a Delaware corporation (the “Company”),
and Computershare Trust Company, Inc., as Rights Agent (the “Rights Agent”), to purchase from the Company at any time
after the Distribution Date (as such term is defined in the Rights Agreement)
and prior to 5:00 P.M., Eastern time, on October 30, 2012 at the
principal office of the Rights Agent, or at the office of its successor as
Rights Agent, one one-hundredth of a fully paid non-assessable share of Series
A Junior Participating Preferred Stock, par value $.0001 per share (the “Preferred Shares”), of the Company, at a purchase price of
$36 per one one-hundredth of a Preferred Share (the “Purchase Price”),
upon presentation and surrender of this Right Certificate with the Form of
Election to Purchase duly executed.”

Section 5.       Amendments
to Exhibit C.

(a)       The
last sentence of the first paragraph of Exhibit C of the Rights Agreement
is hereby amended in its entirety to read as follows:

“The description and terms of the Rights are set forth
in a Rights Agreement dated as of October 30, 2002, as amended on December 24, 2003
and November 16, 2006 (as so amended, the “Rights
Agreement”) between the Company and Computershare Trust Company,
Inc., as Rights Agent (the “Rights Agent”).”

(b)       The
second paragraph of Exhibit C of the Rights Agreement is hereby amended in its
entirety to read as follows:

“Until the earlier to occur of (i) 10 days
following a public announcement

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that a person or group of affiliated or associated persons have
acquired beneficial ownership of 15% or more of the outstanding Common Shares
of the Company (an “Acquiring Person”)
or (ii) 10 business days (or such later date as may be determined by action of the
Board of Directors prior to such time as any person or group of affiliated
persons becomes an Acquiring Person) following the commencement of, or
announcement of an intention to make, a tender offer or exchange offer the
consummation of which would result in the beneficial ownership by a person or
group of 15% or more of the outstanding Common Shares (the earlier of such
dates being called the “Distribution Date”),
the Rights will be evidenced, with respect to any of the Common Share certificates
outstanding as of the Record Date, by such Common Share certificate with a copy
of this Summary of Rights attached thereto.”

(c)           The thirteenth
paragraph of Exhibit C of the Rights Agreement is hereby amended in its
entirety to read as follows:

“At any time prior to the acquisition by a person or
group of affiliated or associated persons of beneficial ownership of 15% or
more of the outstanding Common Shares, the Board of Directors of the Company
may redeem the Rights in whole, but not in part, at a price of $.01 per Right
(the “Redemption Price”).  The redemption of the Rights may be made
effective at such time on such basis with such conditions as the Board of
Directors in its sole discretion may establish.”

Section 6.       Severability. 
If any term, provision, covenant or restriction of this Amendment is held by a
court of competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Amendment shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.

Section 7.       Governing
Law.  This Amendment shall be deemed to be a contract made under the
laws of the State of New York and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts
made and to be performed entirely within such State.

Section 8.       Counterparts. 
This Amendment may be executed by facsimile and in any number of counterparts
and each of such counterparts shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the
same instrument.

Section 9.       Effect
of Amendment.  Except as expressly modified herein, the Rights
Agreement shall remain in full force and effect.

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

	
  

  	
  ARENA PHARMACEUTICALS,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Jack Lief

  	
   

  
	
   

  	
  Name:  Jack Lief

  
	
   

  	
  Title:    President
  and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  COMPUTERSHARE TRUST
  COMPANY, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Kellie
  Gwinn

  	
   

  
	
   

  	
  Name:  Kellie
  Gwinn

  
	
   

  	
  Title:   Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Ian Yewer

  	
   

  
	
   

  	
  Name:  Ian Yewer

  
	
   

  	
  Title:   PresidentPrepared and filed by St Ives Financial

Exhibit 10.1

FIRST AMENDMENT TO
EMPLOYMENT AGREEMENT

  FIRST AMENDMENT, dated as of November 15,
      2006 (this “Amendment”) to EMPLOYMENT AGREEMENT, dated
      as of June 1, 2006 (as heretofore amended, the “Employment Agreement”)
      between A. C. Moore Arts & Crafts, Inc., a Pennsylvania corporation
      (“Company”), and Rick A. Lepley (“Executive”).
      Capitalized terms used herein and not defined herein shall have the respective
      meanings set forth for such terms in the Employment Agreement.

R E C I T A L S:

  WHEREAS, Company and Executive
      have mutually agreed that certain provisions of the Employment Agreement
      be amended, as set forth herein.

  NOW, THEREFORE, intending to be
      legally bound hereby, it is agreed as follows:

	Section 1.      Amendment
        to Paragraph 4(b). Immediately after the tenth word of the first
        sentence, which is the word “terminated”, Paragraph 4(b)
    is amended to include the following parenthetical:

	 	 	 
	 	 	“(including, without limitation, pursuant to the six month notice under Paragraph 4(a))”

	 
	Section 2.      Amendment
        to Section 6(a)(iii) of Appendix I. Section 6(a)(iii) of Appendix
    I is hereby amended and restated to read as follows:

	 	 	 
	 	 	“(iii)      all options to purchase common stock in the Company to which Executive would be entitled to be granted pursuant to the terms of this Agreement  shall immediately be deemed granted, vested and become exercisable on the Date of Termination. Executive shall have 18 months after the Date of Termination to exercise such options, subject to the provisions of the plans under which they were granted.”

	 
	Section 3.      Amendment
        to Appendix I. Appendix I is amended to include the following Section
    9:

	 	 	 
	 	 	“Options.  All options to purchase common stock in the Company held by Executive on the date of a Change of Control shall immediately be deemed vested and become exercisable on the date of the Change in Control and Executive shall have until the end of the applicable original term of each such option to exercise such options; provided, however, that in the event that Executive’s employment with the Company is terminated for any reason (other than Cause) after the Change in Control, Executive shall have until the earlier of (1) the end of the applicable original term of each such option and (2) 18 months after the Date of Termination to exercise such options post-termination.  In the event that Executive’s employment with
the Company is terminated for Cause, all options held by Executive shall terminate immediately.”

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	Section 4.      Amendment
        to Paragraph 3(i)(2). Paragraph 3(i)(2) is amended and restated to
    read as follows:

	 	 	 
	 	 	“(2)      For each calendar year, after December 31, 2006, during the Employment Term (each, an “Annual Option Year”), Executive shall be granted a non-qualified option to purchase 100,000 shares of common stock of the Company (each, an “Annual Option”) on the day (each, a “Management Grant Date”) of each such calendar year that the Board otherwise annually grants options or other equity to management of the Company, if Executive is  employed by Company pursuant to this Agreement on such Management Grant Date of such calendar year; provided however, if Executive is employed by the Company pursuant to this Agreement on June 1 of an Annual Option Year (each, an “Option
Entitlement Date”), Executive shall be granted an Annual Option on the Management Grant Date of such year, irrespective of whether Executive is employed by the Company pursuant to this Agreement on the Management Grant Date of such year; and if there is no Management Grant Date of such year, Executive shall be granted an Annual Option on December 31 of such year, irrespective of whether Executive is employed by the Company pursuant to this Agreement on December 31 of such year.  In accordance with Executive’s Stock Option Agreements evidencing the Annual Options and Appendix I of this Agreement, Executive shall have the right to exercise the Annual Options within certain time periods (each, a "Period") after death, disability or other terminations of employment, including
without limitation  for three months after the date of termination of employment without Cause.  If the grant date of an Annual Option is made after both (x) the Option Entitlement Date and (y) the date of termination of Executive’s employment under the Agreement, then notwithstanding anything to the contrary in this Agreement or the Stock Option Agreements, the grant date of such Annual Option, rather than the date of termination of employment, shall serve as the first day of the applicable Period for such Annual Option.”

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	Section 5.      Effectiveness.
    This Amendment shall be become effective as of the date hereof.

	 
	Section 6.      Status
        of Employment Agreement. This Amendment is limited solely for the
        purposes and to the extent expressly set forth herein, and, except as
        expressly set forth herein all of the terms, provisions and conditions
        of the Employment Agreement shall continue in full force and effect and
    are not effected by this Amendment.

  IN WITNESS WHEREOF, the parties
      hereto have caused this First Amendment to Employment Agreement to be duly
      executed and delivered as of the date first written above.

	 	/s/ Rick A. Lepley
	 	

    
	 	RICK A. LEPLEY
	 	 
	 	 
	 	A.C. MOORE ARTS & CRAFTS, INC.
	 	 	 
	 	By:	/s/ Michael J. Joyce
	 	 	

  
	 	 	Michael J. Joyce
	 	 	Chairman of the Board of Directors

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