EX-10.6



 EXHIBIT 10.6 

Tetraphase Pharmaceuticals, Inc. 
 Incentive Stock Option Agreement  
 Granted Under 2006 Stock Incentive
Plan 
  

	1.	Grant of Option. 

 This
agreement evidences the grant by Tetraphase Pharmaceuticals, Inc., a Delaware corporation (the “Company”), on             , 200[    ] (the “Grant
Date”) to [                    ], an employee of the Company (the “Participant”), of an option to purchase, in whole or in
part, on the terms provided herein and in the Company’s 2006 Stock Incentive Plan (the “Plan”), a total of [                ] shares (the
“Shares”) of common stock, $0.001 par value per share, of the Company (“Common Stock”) at a price of $[        ] per Share. Unless earlier terminated, this option shall expire at
5:00 p.m., Eastern time, on [                    ] (the “Final Exercise Date”). 

It is intended that the option evidenced by this agreement shall be an incentive stock option as defined in Section 422 of the
Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder (the “Code”). Except as otherwise indicated by the context, the term “Participant”, as used in this option, shall be deemed to include any
person who acquires the right to exercise this option validly under its terms. 
  

	2.	Vesting Schedule. 

 This
option will become exercisable (“vest”) as to     % of the original number of Shares on the [first] anniversary of the Grant Date and as to an additional     % of the original number of
Shares at the end of each successive [three-month] period following the first anniversary of the Grant Date until the [fourth] anniversary of the Grant Date. 
 The right of exercise shall be cumulative so that to the extent the option is not exercised in any period to the maximum extent permissible it shall continue to be exercisable, in whole or in part, with
respect to all Shares for which it is vested until the earlier of the Final Exercise Date or the termination of this option under Section 3 hereof or the Plan. 
  

	3.	Exercise of Option. 

 (a)
Form of Exercise. Each election to exercise this option shall be in writing, signed by the Participant, and received by the Company at its principal office, accompanied by this agreement, and payment in full in the manner provided in the
Plan. The Participant may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share. 
 (b) Continuous Relationship with the Company Required. Except as otherwise provided in this Section 3, this option may not be exercised unless the Participant, at the time he or she exercises
this option, is, and has been at all times since the Grant Date, an employee or officer of, or consultant or advisor to, the Company or any parent or subsidiary of the Company as defined in Section 424(e) or (f) of the Code (an
“Eligible Participant”). 







 (c) Termination of Relationship with the Company. If the Participant ceases to be an
Eligible Participant for any reason, then, except as provided in paragraphs (d) and (e) below, the right to exercise this option shall terminate three months after such cessation (but in no event after the Final Exercise Date),
provided that this option shall be exercisable only to the extent that the Participant was entitled to exercise this option on the date of such cessation. Notwithstanding the foregoing, if the Participant, prior to the Final Exercise
Date, violates the non-competition or confidentiality provisions of any employment contract, confidentiality and nondisclosure agreement or other agreement between the Participant and the Company, the right to exercise this option shall terminate
immediately upon written notice to the Participant from the Company describing such violation. 
 (d) Exercise Period Upon
Death or Disability. If the Participant dies or becomes disabled (within the meaning of Section 22(e)(3) of the Code) prior to the Final Exercise Date while he or she is an Eligible Participant and the Company has not terminated such
relationship for “cause” as specified in paragraph (e) below, this option shall be exercisable, within the period of one year following the date of death or disability of the Participant, by the Participant (or in the case of death by
an authorized transferee), provided that this option shall be exercisable only to the extent that this option was exercisable by the Participant on the date of his or her death or disability, and further provided that this option shall
not be exercisable after the Final Exercise Date. 
 (e) Termination for Cause. If, prior to the Final Exercise Date, the
Participant’s employment is terminated by the Company for Cause (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such termination of employment. If the Participant is party to an
employment or severance agreement with the Company that contains a definition of “cause” for termination of employment, “Cause” shall have the meaning ascribed to such term in such agreement. Otherwise, “Cause” shall
mean willful misconduct by the Participant or willful failure by the Participant to perform his or her responsibilities to the Company (including, without limitation, breach by the Participant of any provision of any employment, consulting,
advisory, nondisclosure, non-competition or other similar agreement between the Participant and the Company), as determined by the Company, which determination shall be conclusive. The Participant shall be considered to have been discharged for
Cause if the Company determines, within 30 days after the Participant’s resignation, that discharge for cause was warranted. 
  

	4.	Company Right of First Refusal. 

 (a) Notice of Proposed Transfer. If the Participant proposes to sell, assign, transfer, pledge, hypothecate or otherwise dispose of, by operation of law or otherwise (collectively,
“transfer”) any Shares acquired upon exercise of this option, then the Participant shall first give written notice of the proposed transfer (the “Transfer Notice”) to the Company. The Transfer Notice shall name the proposed
transferee and state the number of such Shares the Participant proposes to transfer (the “Offered Shares”), the price per share and all other material terms and conditions of the transfer. 

(b) Company Right to Purchase. For 30 days following its receipt of such Transfer Notice, the Company shall have the option to
purchase all or part of the Offered Shares at the 

  
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price and upon the terms set forth in the Transfer Notice. In the event the Company elects to purchase all or part of the Offered Shares, it shall give written notice of such election to the
Participant within such 30-day period. Within 10 days after his or her receipt of such notice, the Participant shall tender to the Company at its principal offices the certificate or certificates representing the Offered Shares to be purchased by
the Company, duly endorsed in blank by the Participant or with duly endorsed stock powers attached thereto, all in a form suitable for transfer of the Offered Shares to the Company. Promptly following receipt of such certificate or certificates, the
Company shall deliver or mail to the Participant a check in payment of the purchase price for such Offered Shares; provided that if the terms of payment set forth in the Transfer Notice were other than cash against delivery, the
Company may pay for the Offered Shares on the same terms and conditions as were set forth in the Transfer Notice; and provided further that any delay in making such payment shall not invalidate the Company’s exercise of its option
to purchase the Offered Shares. 
 (c) Shares Not Purchased By Company. If the Company does not elect to acquire all of
the Offered Shares, the Participant may, within the 30-day period following the expiration of the option granted to the Company under subsection (b) above, transfer the Offered Shares which the Company has not elected to acquire to the proposed
transferee, provided that such transfer shall not be on terms and conditions more favorable to the transferee than those contained in the Transfer Notice. Notwithstanding any of the above, all Offered Shares transferred pursuant to
this Section 4 shall remain subject to the right of first refusal set forth in this Section 4 and such transferee shall, as a condition to such transfer, deliver to the Company a written instrument confirming that such transferee shall be
bound by all of the terms and conditions of this Section 4. 
 (d) Consequences of Non-Delivery. After the time at
which the Offered Shares are required to be delivered to the Company for transfer to the Company pursuant to subsection (b) above, the Company shall not pay any dividend to the Participant on account of such Offered Shares or permit the
Participant to exercise any of the privileges or rights of a stockholder with respect to such Offered Shares, but shall, insofar as permitted by law, treat the Company as the owner of such Offered Shares. 

(e) Exempt Transactions. The following transactions shall be exempt from the provisions of this Section 4: 

(1) any transfer of Shares to or for the benefit of any spouse, child or grandchild of the Participant, or to a trust for their benefit;

 (2) any transfer pursuant to an effective registration statement filed by the Company under the Securities Act of 1933, as
amended (the “Securities Act”); and 
 (3) the sale of all or substantially all of the shares of capital stock of the
Company (including pursuant to a merger or consolidation); 
 provided, however, that in the case of a transfer pursuant to clause
(1) above, such Shares shall remain subject to the right of first refusal set forth in this Section 4 and such transferee shall, as a condition to such transfer, deliver to the Company a written instrument confirming that such transferee
shall be bound by all of the terms and conditions of this Section 4. 

  
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 (f) Assignment of Company Right. The Company may assign its rights to purchase
Offered Shares in any particular transaction under this Section 4 to one or more persons or entities. 
 (g)
Termination. The provisions of this Section 4 shall terminate upon the earlier of the following events: 
 (1) the
closing of the sale of shares of Common Stock in an underwritten public offering pursuant to an effective registration statement filed by the Company under the Securities Act; or 

(2) the sale of all or substantially all of the capital stock, assets or business of the Company, by merger, consolidation, sale of
assets or otherwise (other than a merger or consolidation in which all or substantially all of the individuals and entities who were beneficial owners of the Common Stock immediately prior to such transaction beneficially own, directly or
indirectly, more than 50% of the outstanding securities entitled to vote generally in the election of directors of the resulting, surviving or acquiring corporation in such transaction). 

(h) No Obligation to Recognize Invalid Transfer. The Company shall not be required (1) to transfer on its books any of the
Shares which shall have been sold or transferred in violation of any of the provisions set forth in this Section 4, or (2) to treat as owner of such Shares or to pay dividends to any transferee to whom any such Shares shall have been so
sold or transferred. 
 (i) Legends. The certificate representing Shares shall bear a legend substantially in the
following form (in addition to, or in combination with, any legend required by applicable federal and state securities laws and agreements relating to the transfer of the Company securities): 

“The shares represented by this certificate are subject to a right of first refusal in favor of the Company, as provided in a certain
stock option agreement with the Company.” 
 (j) Other Obligations. Notwithstanding any of the provisions of this
Section 4 to the contrary, the provisions of this Section 4, other than subsections (e), (h) and (i), shall not be effective and shall not apply to the Employee or the Shares if and for so long as the Employee is bound by and subject
to the provisions set forth in Section 3 of the Stockholders Agreement, dated July [    ], 2006, by and among the Company and the entities and individuals party thereto, as amended from time to time. 

 

	5.	Agreement in Connection with Public Offering. 

 The Participant agrees, in connection with the initial underwritten public offering of the Company’s securities pursuant to a registration statement under the Securities Act, (i) not to sell,
make short sale of, loan, grant any options for the purchase of, or otherwise dispose of any shares 

  
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of Common Stock held by the Participant (other than those shares included in the offering) without the prior written consent of the Company or the underwriters managing such initial underwritten
public offering of the Company’s securities for a period of 180 days from the effective date of such registration statement, and (ii) to execute any agreement reflecting clause (i) above as may be requested by the Company or the
managing underwriters at the time of such offering. 
  

	6.	Tax Matters. 

 (a)
Withholding. No Shares will be issued pursuant to the exercise of this option unless and until the Participant pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes
required by law to be withheld in respect of this option. 
 (b) Disqualifying Disposition. If the Participant disposes
of Shares acquired upon exercise of this option within two years from the Grant Date or one year after such Shares were acquired pursuant to exercise of this option, the Participant shall notify the Company in writing of such disposition.

  

	7.	Nontransferability of Option. 

 This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Participant, either voluntarily or by operation of law, except by will or the laws of descent and distribution,
and, during the lifetime of the Participant, this option shall be exercisable only by the Participant. 
  

	[8.	Delivery of Shares; Compliance with Securities Laws. Etc. 

 (a) General. The Company shall, upon payment of the option price for the number of Shares purchased and paid for, make prompt delivery of such Shares to the Participant, provided that if any law or
regulation requires the Company to take any action with respect to such Shares before the issuance thereof, then the date of delivery of such Shares shall be extended for the period necessary to complete such action. 

(b) Listing, Qualification, Etc. This option shall be subject to the requirement that if, at any time, counsel to the Company
shall determine that the listing, registration or qualification of the Shares subject hereto upon any securities exchange or under any state or federal law, or the consent or approval of any governmental or regulatory body, or that the disclosure of
nonpublic information or the satisfaction of any other condition is necessary as a condition of, or in connection with, the issuance or purchase Of shares hereunder, this option may not be exercised, in whole or in part, unless such listing,
registration, qualification, consent or approval, disclosure or satisfaction of such other condition shall have been effected or obtained on terms acceptable to the Board of Directors. Nothing herein shall be deemed to require the Company to apply
for, effect or obtain such listing, registration, qualification, or disclosure, or to satisfy such other condition. 

  
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 (c) Legends on Stock Certificates. All stock certificates representing Shares issued
to the Participant upon exercise of this option shall have affixed thereto legends substantially in the following forms, in addition to any other legends required by applicable state law: 

“The shares of stock represented by this certificate have not been registered under the Securities Act of 1933 and may not be
transferred, sold or otherwise disposed of in the absence of an effective registration statement with respect to the shares evidenced by this certificate, filed and made effective under the Securities Act of 1933, or an opinion of counsel
satisfactory to the Company to the effect that registration under such Act is not required.” 
 “The shares of stock
represented by this certificate are subject to certain restrictions on transfer contained in an Option Agreement, a copy of which will be furnished upon request by the issuer.”] 

 

	[8/9].  Provisions	of the Plan. 

 This option
is subject to the provisions of the Plan, a copy of which is furnished to the Participant with this option. 
 IN WITNESS
WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument. 

 

							
		 		 	TETRAPHASE PHARMACEUTICALS, INC.
				
	Dated:                     	 		 	By:	 	  

		 		 	Name:	 	  

		 		 	Title:	 	  



  
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 PARTICIPANT’S ACCEPTANCE 

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof. The undersigned hereby acknowledges
receipt of a copy of the Company’s 2006 Stock Incentive Plan. 
  

			
	PARTICIPANT:
	
	  

		
	Address:	 	  

		
		 	  




  
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