UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 22, 2018

ACHIEVE LIFE SCIENCES, INC.

(Exact name of Registrant as Specified in Its Charter)

Registrant’s Telephone Number, Including Area Code: (604) 736-3678

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

On May 22, 2018, Achieve Life Sciences, Inc., or the Company, executed employment agreements with Richard Stewart, its Chief Executive Officer, and Anthony Clarke, its President and Chief Scientific Officer.

Richard Stewart Employment Agreement

Pursuant to the employment agreement, Mr. Stewart will receive an annual base salary of $500,000. Mr. Stewart is also eligible to earn an annual bonus of up to an additional 50% of his annual base salary, of which 100% will be based on the satisfactory completion of certain corporate milestones. During Mr. Stewart’s employment, he is eligible to participate in the Company’s employee benefit plans available to other employees of the Company.

Upon termination, the Company has agreed to pay Mr. Stewart (i) all unpaid salary and other vested but unpaid cash entitlements accrued through the termination date, including unused vacation and unreimbursed documented business expenses and (ii) any other vested benefits earned under any employee benefit plans and arrangements maintained by the Company, in accordance with the terms of such plans and arrangements. Additionally, if (a) Mr. Stewart’s employment is involuntary terminated for any reason other than cause (as defined in the employment agreement) or he voluntarily resigns for good reason (as defined in his employment agreement), and (b) the Company has either completed one or more financing(s) totaling a minimum of $10 million in gross proceeds or 12 months have passed from the execution date of the agreement, then (c) the Company has agreed to pay him a lump sum payment in an amount equal to 18 months of his then-current monthly base salary and to continue paying his monthly health insurance premiums for a discretionary period to be decided by the Company, subject to certain limitations. The Company will also accelerate the vesting of Mr. Stewart’s then outstanding equity compensation awards (including awards that would otherwise vest only upon satisfaction of performance criteria) that would have time-vested over an 18-month period had he continued to provide services to the Company. To receive the foregoing benefits, Mr. Stewart must enter into and not revoke a release agreement with the Company.

Additionally, if Mr. Stewart is terminated for any reason other than cause (as defined in the employment agreement) or he voluntarily resigns for good reason (as defined in the employment agreement) within 12 months after a change of control of the Company, then he will be entitled to (i) a lump sum payment in an amount equal to 24 months of his then annual base compensation plus an amount equal to 100% of his target annual bonus for the year during which the termination occurs, (ii) continued payment by the Company of his health insurance premiums for a discretionary period to be decided by the Company, subject to certain limitations, and (iii) immediate vesting of all of his then outstanding unvested equity awards (including awards that would otherwise vest only upon satisfaction of performance criteria).

Under his employment agreement, Mr. Stewart agreed to standard non-solicitation, non-compete and non-disparagement provisions, and the Company agreed to indemnify Mr. Stewart to the maximum extent permitted by applicable law and the Company’s governance documents with respect to his service to the Company.

The employment agreement between the Company and Mr. Stewart is filed as Exhibit 10.1 to this Current Report on Form 8-K.

Anthony Clarke Employment Agreement

Pursuant to the employment agreement, Mr. Clarke will receive an annual base salary of $420,000. Mr. Clarke is also eligible to earn an annual bonus of up to an additional 40% of his annual base salary, of which 100% will be based on the satisfactory completion of certain corporate milestones. During Mr. Clarke’s employment, he is eligible to participate in the Company’s employee benefit plans available to other employees of the Company.

Upon termination, the Company has agreed to pay Mr. Clarke (i) all unpaid salary and other vested but unpaid cash entitlements accrued through the termination date, including unused vacation and unreimbursed documented business expenses and (ii) any other vested benefits earned under any employee benefit plans and arrangements maintained by the Company, in accordance with the terms of such plans and arrangements. Additionally, if (a) Mr. Clarke’s employment is involuntary terminated for any reason other than cause (as defined in the employment agreement) or he voluntarily resigns for good reason (as defined in his employment agreement), and (b) the Company has either completed one or more financing(s) totaling a minimum of $10 million in gross proceeds or 12 months have passed from the execution date of the agreement, then (c) the Company has agreed to pay him a lump sum payment in an amount equal to 12 months of his then-current monthly base salary and to continue paying his monthly health insurance premiums for a discretionary period to be decided by the Company, subject to certain limitations. The Company will also accelerate the vesting of Mr. Clarke’s then outstanding equity compensation awards (including awards that would otherwise vest only upon satisfaction of performance criteria) that would have time-vested over a 12-month period had he continued to provide services to the Company. To receive the foregoing benefits, Mr. Clarke must enter into and not revoke a release agreement with the Company.

Additionally, if Mr. Clarke is terminated for any reason other than cause (as defined in the employment agreement) or he voluntarily resigns for good reason (as defined in the employment agreement) within 12 months after a change of control of the Company, then he will be entitled to (i) a lump sum payment in an amount equal to 15 months of his then annual base compensation plus an amount equal to 100% of his target annual bonus for the year during which the termination occurs, (ii) continued payment by the Company of his health insurance premiums for a discretionary period to be decided by the Company, subject to certain limitations, and (iii) immediate vesting of all of his then outstanding unvested equity awards (including awards that would otherwise vest only upon satisfaction of performance criteria).

Under his employment agreement, Mr. Clarke agreed to standard non-solicitation, non-compete and non-disparagement provisions, and the Company agreed to indemnify Mr. Clarke to the maximum extent permitted by applicable law and the Company’s governance documents with respect to his service to the Company.

The employment agreement between the Company and Mr. Clarke is filed as Exhibit 10.1 to this Current Report on Form 8-K.

On May 22, 2018, in each case as approved by the Company’s stockholders on May 22, 2018, the Company filed (i) a certificate of amendment to its Second Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect a reverse stock split of the Company’s common stock at a ratio of 1-for-10 and (ii) a certificate of amendment to its Second Amended and Restated Certificate of Incorporation to increase the number of authorized shares of common stock from 75,000,000 to 150,000,000.

The Certificates of Amendment are filed as Exhibits 3.1 and 3.2 to this Current Report on Form 8-K.

The Annual Meeting of Stockholders of the Company was held on May 22, 2018. The following is a brief description of each matter voted upon and the certified voting results.

(1)    Election of seven directors to serve until the Company’s next annual meeting or until the directors’ successors are duly elected and qualified:

Pursuant to the foregoing votes, the nominees listed above were elected as directors to serve on the Company’s board of directors.

(2)    Ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2018:

Pursuant to the foregoing votes, the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2018 was ratified.

(3)    Approval of the issuance of 20% or more of the Company’s issued and outstanding common stock to Lincoln Park Capital Fund LLC:

Pursuant to the foregoing, this matter was approved.

(4)    Approval of an amendment to the Company’s Certificate of Incorporation, as amended, to effect a reverse stock split by a ratio not to exceed 1-for-10:

Pursuant to the foregoing, this matter was approved.

(5)    Approval of an amendment to the Company’s Certificate of Incorporation, as amended, to increase the number of authorized shares of common stock of the Company:

Pursuant to the foregoing, this matter was approved.

The Company’s board of directors has determined to set the reverse stock split ratio at 1-for-10. The effective date of the reverse stock split is May 23, 2018, and the shares will begin trading on a split-adjusted basis on May 24, 2018.

Upon the effectiveness of the reverse stock split on May 23, 2018, every ten shares of the Company’s issued and outstanding common stock will be automatically combined and reclassified into one issued and outstanding share of common stock. The reverse stock split will not affect any stockholder’s ownership percentage of the Company’s common stock, alter the par value of the Company’s common stock, or modify any voting rights or other terms of the common stock.

At the market open on May 24, 2018, the Company’s common stock will continue to trade on The Nasdaq Capital Market under the symbol “ACHV,” but will be assigned a new CUSIP number (004468203) and will trade on a split-adjusted basis.

On May 23, 2018, the Company issued a press release announcing the foregoing. A copy of the press release is filed as Exhibit 99.1 to this report.

(d)    Exhibits

SIGNATURES

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