Item 8.01. Other Events.
As previously disclosed, on May 6, 2020, Tetraphase Pharmaceuticals, Inc. (Tetraphase) received an unsolicited proposal from La Jolla
Pharmaceutical Company (La Jolla) to acquire Tetraphase for $22 million in cash, plus an additional $12.5 million in cash potentially payable under contingent value rights to be issued in the transaction (the La Jolla
Proposal). 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 7, 2020, the board of directors of
Tetraphase (the Tetraphase Board) determined in good faith, after consultation with its independent financial advisors and outside legal counsel, that the unsolicited La Jolla Proposal constitutes or 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
La Jolla, and (2) engage in or otherwise participate in discussions or negotiations with La Jolla in respect of the La Jolla 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 determined to consider the La Jolla Proposal, to enter into discussions and/or negotiations with
respect to the La Jolla Proposal and, subject to La Jolla entering into an acceptable confidentiality agreement, to furnish non-public information to La Jolla. There can be no assurances that any definitive
agreement or transaction will result from the La Jolla Proposal or Tetraphases discussions with La Jolla.
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 La Jolla Proposal.
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 La Jolla 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.
No Offer or Solicitation