Item 8.01. Other Events.
On May 14, 2020, Tetraphase Pharmaceuticals, Inc. (Tetraphase) received an unsolicited proposal from Melinta Therapeutics, Inc.
(Melinta) to acquire Tetraphase for $27.0 million in cash, plus an additional $12.5 million in cash potentially payable under contingent value rights to be issued in the transaction. Tetraphase also previously announced that it
had entered into a merger agreement, dated as of March 15, 2020 (the AcelRx Merger Agreement), with AcelRx Pharmaceuticals, Inc. (AcelRx) and Consolidation Merger Sub, Inc. with respect to the acquisition of Tetraphase
by AcelRx, pursuant to which each outstanding share of Tetraphase common stock would be automatically converted into the right to receive (1) a number of shares of the Parents common stock equal to 0.6303 (the Exchange Ratio);
provided that if the Companys closing net cash (the Closing Net Cash) is less than $5,000,000, the Exchange Ratio shall be adjusted to the ratio determined as follows: (a) (i) $20,000,000, minus (ii) the dollar amount by which
the Closing Net Cash is less than $5,000,000, minus (iii) $10,265,292, divided by (b) (i) 10,800,166, divided by (ii) $1.43, and (2) one contingent value right per share representing the right to receive certain consideration based on the
achievement of net sales milestones.
On May 14, 2020 the Tetraphase Board determined in good faith, after consultation with its independent
financial advisors and outside legal counsel, that the Melinta Proposal could reasonably be expected to lead to a superior offer as defined in the AcelRx Merger Agreement, and that the failure to (1) furnish, pursuant to an acceptable
confidentiality agreement, information (including non-public information) to Melinta, and (2) engage in or otherwise participate in discussions or negotiations with Melinta in respect of the Melinta
Proposal could reasonably be expected to be inconsistent with the fiduciary duties of the Tetraphase Board to Tetraphases stockholders under applicable legal requirements. Accordingly, in accordance with the AcelRx Merger Agreement, the
Tetraphase Board has determined to consider the Melinta Proposal, to enter into discussions and/or negotiations with respect to the Melinta Proposal and, subject to Melinta entering into an acceptable confidentiality agreement, to furnish non-public information to Melinta. There can be no assurances that any definitive agreement or transaction will result from the Melinta Proposal or Tetraphases discussions with Melinta.
The Tetraphase Board is evaluating the Melinta Proposal and has not made a determination as to whether the proposal constitutes a superior offer under the
terms of the AcelRx Merger Agreement. Further, the Tetaphase Board continues to evaluate the previously disclosed proposal from La Jolla Pharmaceutical Company (La Jolla) to acquire Tetraphase for $22.3 million in cash, plus an
additional $12.5 million in cash potentially payable under contingent value rights to be issued in that transaction, and has not made a determination as to whether such proposal constitutes a superior offer under the terms of the AcelRx Merger
Agreement. At this time, the Tetraphase Board (1) continues to recommend the AcelRx Merger Agreement with AcelRx to its stockholders, (2) is not modifying or withdrawing its recommendation with respect to the AcelRx Merger Agreement and
the merger, or proposing to do so, and (3) is not making any recommendation with respect to the Melinta Proposal or the Melinta Merger Agreement.
Janney Montgomery Scott LLC is acting as financial advisor to Tetraphase and Wilmer Cutler Pickering Hale and Dorr LLP is acting as legal advisor.
Additional Information and Where to Find it
In
connection with the proposed transaction between Tetraphase and AcelRx, AcelRx filed with the SEC the Registration Statement containing a document constituting a prospectus of AcelRx and a proxy statement of Tetraphase. The Registration Statement
was declared effective by the SEC on April 24, 2020, and Tetraphase commenced mailing the definitive proxy statement/prospectus to stockholders of Tetraphase on April 28, 2020. Tetraphase and AcelRx also plan to file other relevant
documents with the SEC regarding the proposed transaction. Investors and security holders are urged to read the definitive proxy statement/prospectus and other relevant documents filed with the SEC carefully and in their entirety because they
contain important information.
Investors and security holders can obtain free copies of the proxy statement/prospectus and other documents filed
with the SEC by Tetraphase, AcelRx and/or Melinta through the web site maintained by the SEC at www.sec.gov. In addition, investors and security holders can obtain free copies of the proxy statement/prospectus from Tetraphase by written request to
Tetraphase Pharmaceuticals, Inc., 480 Arsenal Way, Watertown, Massachusetts 02472, Attn: Secretary or by calling (617) 715-3600.