Item 8.01. Other Events.
As previously disclosed, on May 14, 2020, Tetraphase Pharmaceuticals, Inc.
("Tetraphase" or the "Company") 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. Also as previously disclosed, on
May 21, 2020, the Company received a further proposal from Melinta, accompanied
by a draft agreement and plan of merger, a draft form of contingent value rights
agreement and a draft support agreement. Under this proposal, Melinta would
acquire Tetraphase for approximately $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.
On May 27, 2020, the Company received a revised proposal from Melinta amending
its May 21, 2020 proposal to acquire the Company (the "Amended Melinta
Proposal"). Under the Amended Melinta Proposal, Melinta would acquire Tetraphase
for $34.0 million in cash, plus an additional $16.0 million in cash potentially
payable under contingent value rights to be issued in the transaction. Under the
Amended Melinta Proposal, the upfront cash consideration would be as follows:
(i) $1.52 per share of Tetraphase common stock (including common stock
underlying restricted stock units, performance-based stock units
and pre-funded warrants), (ii) $2.21 per share of Tetraphase common stock
underlying the common stock warrants issued by the Company in 2019, and (iii)
$2.21 per share of Tetraphase common stock underlying the common stock warrants
issued by the Company in 2020. In addition, the Amended Melinta Proposal does
not provide for a downward adjustment based on the Company's closing net cash
amount.
Previously, on May 27, 2020,Tetraphase had announced that it had entered into an
Amendment to Agreement and Plan of Merger (the "Amendment") amending the merger
agreement, dated as of March 15, 2020 by and among Tetraphase, AcelRx
Pharmaceuticals, Inc. ("AcelRx") and Consolidation Merger Sub, Inc. (the
"Original Merger Agreement", and as amended by the Amendment, the "AcelRx Merger
Agreement" 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) $0.2434 in cash and 0.7217 of a share
of AcelRx common stock, representing approximately $1.37 in upfront per share
value, based on the closing price of AcelRx's common stock as of the close of
trading on May 27, 2020, in each case subject to downward adjustment in the
event that the Company's closing net cash is less than $5.0 million, and (2) one
contingent value right, which would entitle the holders to receive potential
aggregate payments of up to $14.5 million in cash upon the achievement of
certain future XERAVA™ net sales milestones starting in 2021. Based on the
closing price of AcelRx common stock on May 27, 2020, the total upfront
consideration to be received by Tetraphase equityholders under the AcelRx Merger
Agreement at closing is valued at approximately $30.6 million, with
approximately $15.9 million of this amount allocated to the Company's
outstanding common stock warrants.
On May 27, 2020, the Company announced that its Board of Directors has
determined that the Amended Melinta Proposal to acquire the Company is a
"Superior Offer" under the terms of the AcelRx Merger Agreement. In connection
with this determination and in accordance with the terms of the AcelRx Merger
Agreement, the Company has given notice to AcelRx of such determination and of
its intention to consider changing its recommendation of the AcelRx Merger
Agreement or terminating the AcelRx Merger Agreement unless AcelRx proposes
revisions to the terms of the AcelRx Merger Agreement or makes another proposal
on or prior to Monday, June 1, 2020 that, if accepted, would result in the
Amended Melinta Proposal ceasing to be a Superior Offer. A copy of the press
release is attached as Exhibit 99.1 hereto and is incorporated herein by
reference.
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 Amended Melinta Proposal.
Additional Information and Where to Find it
In connection with the proposed transaction between Tetraphase and AcelRx
Pharmaceuticals, Inc. ("AcelRx"), AcelRx filed with the Securities and Exchange
Commission (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
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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 Therapeutics, Inc. ("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.
No Offer or Solicitation
This communication does not constitute an offer to sell, or the solicitation of
an offer to buy, any securities, nor a solicitation of any vote or approval,
with respect to the proposed transaction or otherwise. No offering of securities
shall be made except by means of a prospectus meeting the requirements of
Section 10 of the Securities Act of 1933, as amended, and otherwise in
accordance with applicable law. If a negotiated transaction between Tetraphase
and Melinta is agreed, Tetraphase and Melinta will prepare filing(s) related to
the proposed transaction (including a tender offer statement on Schedule TO,
including an offer to purchase, a related letter of transmittal and other tender
offer documents related to the transaction and any amendments thereto, and
Tetraphase would file a recommendation statement on Schedule 14D-9 with the SEC
and any amendments thereto), and Tetraphase will provide the filing(s) to its
stockholders. Tetraphase, and possibly Melinta, may also file other documents
with the SEC regarding the proposed transaction. This document is not a
substitute for any tender offer document or any other document which Tetraphase
or Melinta may file with the SEC in connection with the proposed transaction. If
a negotiated transaction between Tetraphase and Melinta is agreed, investors and
security holders are urged to read the filing(s) and the other relevant
materials with respect to the proposed transaction with Melinta carefully in
their entirety when they become available before making any voting or investment
decision with respect to any proposed transaction with Melinta, because they
will contain important information about any proposed transaction with Melinta.
Participants in the Solicitation
Tetraphase and its directors and executive officers may be deemed to be
participants in the solicitation of proxies from Tetraphase stockholders in
respect of the transactions contemplated by the merger agreement, dated as of
March 15, 2020 (the "AcelRx Merger Agreement") with AcelRx and Consolidation
Merger Sub, Inc. or the Amended Melinta Proposal. Information about Tetraphase's
directors and executive officers is included in Tetraphase's Annual Report on
Form 10-K for the year ended December 31, 2019, which was filed with the SEC on
March 12, 2020. Other information regarding the participants in the solicitation
of proxies in respect of the transactions contemplated by the AcelRx Merger
Agreement, or the transactions contemplated by the Amended Melinta Proposal, as
applicable, and a description of their direct and indirect interests, by
security holdings or otherwise, will be contained in any registration statement,
prospectus, proxy statement and other relevant materials to be filed with the
SEC if and when they become available.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
99.1 Press Release, dated May 27, 2020
Forward-Looking Statements
Statements in this Form 8-K contain various forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements include, but are not limited to, those regarding the
transactions contemplated by the AcelRx Merger Agreement and any proposed
transaction contemplated by Melinta, the expected timetable for completing the
transactions, future financial and operating results, benefits and synergies of
the transactions, future opportunities for the combined company and any other
statements about future
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expectations, plans and prospects for Tetraphase. The words "anticipate,"
"believe," "continue," "could," "estimate," "expect," "intend," "may," "plan,"
"potential," "predict," "project," "should," "target," "would" and similar
expressions are intended to identify forward-looking statements, although not
all forward-looking statements contain these identifying words.
The following factors, among others, could cause actual results to differ
materially from those described in these forward-looking statements: the
determinations made by the Board of Directors of Tetraphase regarding the
Amended Melinta Proposal; actions of AcelRx or any other party in response to
any discussions with Melinta; the results of discussions with Melinta; the
impact of actions of other parties with respect to any discussions and the
potential consummation of the proposed transactions with AcelRx or Melinta; the
outcome of any legal proceedings that could be instituted against Tetraphase or
its directors related to the discussions, the Amended Melinta Proposal or the
AcelRx Merger Agreement; changes in the Amended Melinta Proposal; the risk that
the transactions contemplated by the AcelRx Merger Agreement or the Amended
Melinta Proposal may not be completed in a timely manner, or at all, which may
adversely affect Tetraphase's business and the price of its common stock; the
failure to satisfy all of the closing conditions of the transactions
contemplated by the AcelRx Merger Agreement, including the approval of the
AcelRx Merger Agreement by Tetraphase's stockholders, or with respect to any
definitive agreements for the Amended Melinta Proposal; the occurrence of any
event, change or other circumstance that could give rise to the termination of
the AcelRx Merger Agreement; the effect of the announcement or pendency of the
transactions contemplated by the AcelRx Merger Agreement or the definitive
agreements for the Amended Melinta Proposal on Tetraphase's business, operating
results, and relationships with customers, suppliers, competitors and others;
risks that the transactions contemplated by the AcelRx Merger Agreement or the
Amended Melinta Proposal may disrupt Tetraphase's current plans and business
operations; risks related to the diverting of management's attention from
Tetraphase's ongoing business operations; the outcome of any legal proceedings
that may be instituted against Tetraphase related to the AcelRx Merger Agreement
or the transactions contemplated by the AcelRx Merger Agreement or the Amended
Melinta Proposal or the transactions contemplated thereby; risks relating to
Tetraphase's ability to successfully commercialize Xerava; concerns with or
threats of, or the consequences of, pandemics, contagious diseases or health
epidemics, including COVID-19; generaleconomic and market conditions and the
risk factors set forth under the caption "Risk Factors" in Tetraphase's
Quarterly Report on Form 10-Q for the period ended March 31, 2020 filed with the
SEC on May 7, 2020 and in any other subsequent filings made by Tetraphase with
the SEC. Any forward-looking statements contained in this Form 8-K speak only as
of the date hereof, and Tetraphase specifically disclaims any obligation to
update any forward-looking statements, whether as a result of new information,
future events or otherwise.
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