I wouldn't worry overmuch about "toning" right now... strength training (proper strength training, not the silly arm waving stuff JM does) is critical for preserving and improving lean muscle mass, but you can't lift away the arm fat. Where you body loses fat first is primarily determined by genetics. Because fat loss is a total body process, all the arm exercises in the world won't make the bat wings fly away. :)
Just overall fat loss can do that.