Document:

EX-10.4

 Exhibit 10.4 
 THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO
THE PROVISIONS OF ARTICLE 5 BELOW, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION. 
 WARRANT TO PURCHASE STOCK 
  

			
	 Company: Tetraphase Pharmaceuticals, Inc., a Delaware corporation
 Number of Shares: 777,907, subject to adjustment
 Class of Stock: Series C Convertible
Participating Preferred Stock, $0.001 par value per share
 Warrant Price: $0.2571, subject to adjustment

Issue Date: May 16, 2011
 Expiration Date: May
16, 2021

	Credit Facility:	 	This Warrant is issued in connection with that certain Loan and Security Agreement of even date herewith among Silicon Valley Bank, Oxford Finance LLC, Tetraphase Securities
Corporation and the Company.

 THIS WARRANT CERTIFIES THAT, for good and valuable consideration, SILICON VALLEY BANK (Silicon Valley
Bank, together with any successor or permitted assignee or transferee of this Warrant or of any shares issued upon exercise hereof, is referred to hereinafter as “Holder”) is entitled to purchase the number of fully paid and nonassessable
shares (the “Shares”) of the class of securities (the “Class”) of the above-named company (the “Company”) at the above-stated Warrant Price, all as set forth above and as adjusted pursuant to Article 2 of this
Warrant, subject to the provisions and upon the terms and conditions set forth in this Warrant. 
 ARTICLE 1. EXERCISE. 

1.1 Method of Exercise. Holder may exercise this Warrant by delivering the original of this Warrant together with a duly executed
Notice of Exercise in substantially the form attached as Appendix 1 to the principal office of the Company. Unless Holder is exercising the conversion right set forth in Article 1.2, Holder shall also deliver to the Company a certified or bank
check, wire transfer of immediately available funds (to an account designated by the Company), or other form of payment acceptable to the Company for the aggregate Warrant Price for the Shares being purchased. 

1.2 Conversion Right. In lieu of exercising this Warrant as specified in Article 1.1, Holder may from time to time elect to
convert this Warrant, in whole or in part, on a cashless basis by delivering the original of this Warrant together with a duly executed Notice of Exercise and by canceling a portion of this Warrant in payment of the Warrant Price payable in respect
of the number of Shares purchased upon such exercise. In the event of an exercise pursuant to this Article 1.2, the number of Shares 

 
issued to the holder shall be determined by dividing (a) the aggregate fair market value of the Shares for which this Warrant is being exercised (which shall include both the number of
Shares issued to the Holder and the number of Shares subject to the portion of the Warrant being cancelled) minus the aggregate Warrant Price of such Shares by (b) the fair market value of one Share. The fair market value of the Shares shall be
determined pursuant to Article 1.3. 
 1.3 Fair Market Value. If the Company’s common stock, $0.001 par value per
share (“Common Stock”) is traded in a public market and the Shares are Common Stock, the fair market value of a Share shall be the closing price of a share of Common Stock reported for the business day immediately before Holder delivers
this Warrant together with its Notice of Exercise to the Company (or in the instance where the Warrant is exercised immediately prior to the effectiveness of the Company’s initial public offering (“IPO”), the “price to
public” per share price specified in the final prospectus relating to such offering). If the Common Stock is traded in a public market and the Shares are preferred stock, the fair market value of a Share shall be the closing price of a share of
the Common Stock reported for the business day immediately before Holder delivers this Warrant together with its Notice of Exercise to the Company (or, in the instance where the Warrant is exercised immediately prior to the effectiveness of the IPO,
the initial “price to public” per share price specified in the final prospectus relating to such offering), in both cases, multiplied by the number of shares of the Common Stock into which a Share is convertible. If the Common Stock is not
traded in a public market, the Board of Directors of the Company shall determine fair market value in its reasonable good faith judgment. 
 1.4 Delivery of Certificate and New Warrant. Promptly after Holder exercises or converts this Warrant and, if applicable, the Company receives payment of the aggregate Warrant Price, the Company
shall deliver to Holder certificates for the Shares acquired and, if this Warrant has not been fully exercised or converted and has not expired, a new Warrant representing the Shares not so acquired. 

1.5 Replacement of Warrants. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation, on surrender and cancellation of this Warrant,
the Company shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor. 
 1.6 Treatment of Warrant Upon
Acquisition of Company. 
 1.6.1 “Acquisition”. For the purpose of this Warrant, “Acquisition”
means any sale, license, or other disposition of all or substantially all of the assets of the Company, or any reorganization, consolidation, merger or sale of outstanding capital stock of the Company where the holders of the Company’s
securities before the transaction beneficially own less than a majority of the outstanding voting securities of the surviving entity after the transaction. 
 1.6.2 Treatment of Warrant at Acquisition. 
 A) Holder agrees that, in the event of an
Acquisition in which the sole consideration is cash, Holder shall either (a) exercise its conversion or purchase right under this 

  
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Warrant and such exercise will be deemed effective immediately prior to the closing of such Acquisition and any part of this Warrant not exercised by the closing of such Acquisition will expire
or (b) elect not to exercise its conversion or purchase right under this Warrant, in which case this Warrant will expire upon the closing of such Acquisition. The Company shall provide the Holder with written notice of any Acquisition (together
with such reasonable information as the Holder may request in connection with such Acquisition) not less than ten (10) days prior to the closing of the proposed Acquisition. 
 B) Holder agrees that, in the event of an Acquisition that is an “arms length” sale of all or substantially all of the Company’s assets to a third party that is not an Affiliate (as defined
below) of the Company (a “True Asset Sale”), Holder shall exercise its conversion or purchase right under this Warrant and such exercise will be deemed effective immediately prior to the closing of such Acquisition and any part of this
Warrant not exercised by the closing of such Acquisition will expire; provided, however, that if the Company continues as a going concern following the closing of any such True Asset Sale and Holder elects not to exercise the Warrant, this Warrant
will continue to be exercisable until the Expiration Date. The Company shall provide the Holder with such reasonable information as the Holder may request in connection with such contemplated Acquisition, which is to be delivered to Holder not less
than ten (10) days prior to the closing of the proposed Acquisition. 
 C) Upon the closing of any Acquisition other than those
particularly described in subsections (A) and (B) above, the successor entity shall assume the obligations of this Warrant, and this Warrant shall be exercisable for the same securities, cash, and property as would be payable for the
Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on the record date for the Acquisition and subsequent closing. The Warrant Price and/or number of Shares shall be adjusted accordingly.

 As used herein “Affiliate” shall mean any person or entity that owns or controls directly or indirectly ten percent
(10%) or more of the stock of Company, any person or entity that controls or is controlled by or is under common control with such persons or entities, and each of such person’s or entity’s officers, directors, joint venturers or
partners, as applicable. 
 ARTICLE 2. ADJUSTMENTS TO THE SHARES. 

2.1 Stock Dividends, Splits, Etc. If the Company declares or pays a dividend on the outstanding shares of the Class payable in
Common Stock or other securities, then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without cost to Holder, the total number and kind of securities to which Holder would have been entitled had Holder owned the Shares
as of the record date for the dividend. If the Company subdivides the outstanding shares of the Class by reclassification or otherwise into a greater number of shares or takes any other action which increase the amount of Common Stock into which the
one share of the Class is convertible, the number of Shares purchasable hereunder shall be proportionately increased and the Warrant Price shall be proportionately decreased. If the outstanding shares of the Class are combined or consolidated, by
reclassification or otherwise, into a lesser number of shares of the Class, the Warrant Price shall be proportionately increased and the number of Shares shall be proportionately decreased. 

  
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 2.2 Reclassification, Exchange, Combinations or Substitution. Upon any
reclassification, exchange, substitution, or other event that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant (other than those transactions contemplated by Article 1.6 or Article
2.1), Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the Shares if this Warrant had been exercised immediately before such
reclassification, exchange, substitution, or other event. Such an event shall include, without limitation, any automatic conversion of the outstanding or issuable securities of the Company of the same class or series as the Shares to Common Stock
pursuant to the terms of the Company’s Amended and Restated Certificate of Incorporation, as amended from time to time (the “Certificate of Incorporation”). The Company or its successor shall promptly issue to Holder an amendment to
this Warrant setting forth the number and kind of such new securities or other property issuable upon exercise or conversion of this Warrant as a result of such reclassification, exchange, substitution or other event that results in a change of the
number and/or class of securities issuable upon exercise or conversion of this Warrant. The amendment to this Warrant shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this
Article 2 including, without limitation, adjustments to the Warrant Price and to the number of securities or property issuable upon exercise of the new Warrant. The provisions of this Article 2.2 shall similarly apply to successive
reclassifications, exchanges, substitutions, or other events. 
 2.3 Adjustments for Diluting Issuances. The number of
shares of Common Stock issuable upon conversion of the Shares shall be subject to adjustment, from time to time in the manner set forth in the Certificate of Incorporation as if the Shares were issued and outstanding on and as of the date of any
such required adjustment. The provisions set forth for the Class in the Certificate of Incorporation relating to the above in effect as of the Issue Date may not be amended, modified or waived, without the prior written consent of Holder unless such
amendment, modification or waiver affects the rights associated with the Shares in the same manner as such amendment, modification or waiver affects the rights associated with all other shares of Class. 

2.4 No Impairment. The Company shall not, by amendment of its Certificate of Incorporation or through a reorganization, transfer
of assets, consolidation, merger, dissolution, issue, or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed under this Warrant by the Company, but
shall at all times in good faith assist in carrying out of all the provisions of this Article 2 and in taking all such action as may be necessary or appropriate to protect Holder’s rights under this Article against impairment. 

2.5 Fractional Shares. No fractional Shares shall be issuable upon exercise or conversion of the Warrant and the number of Shares
to be issued shall be rounded down to the nearest whole Share. If a fractional share interest arises upon any exercise or conversion of the Warrant, the Company shall eliminate such fractional share interest by paying Holder the amount computed by
multiplying the fractional interest by the fair market value of a full Share. 

  
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 2.6 Certificate as to Adjustments. Upon each adjustment of the Warrant Price, Class
and/or number of Shares, the Company shall promptly notify Holder in writing, and, at the Company’s expense, promptly compute such adjustment, and furnish Holder with a certificate of its Chief Financial Officer setting forth such adjustment
and the facts upon which such adjustment is based. The Company shall, upon written request, furnish Holder a certificate setting forth the Warrant Price, Class and number of Shares in effect upon the date thereof and the series of adjustments
leading to such Warrant Price, Class and number of Shares. 
 ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY. 

3.1 Representations and Warranties. The Company represents and warrants to, and agrees with, the Holder as follows, as of the
Issue Date: 
 (a) The initial Warrant Price referenced on the first page of this Warrant is not greater than the price per
share at which shares of the same class and series as the Shares were last issued in an arms-length transaction in which at least $500,000 of such shares were sold. 
 (b) All Shares which may be issued upon the exercise of the purchase right represented by this Warrant, and all securities, if any, issuable upon conversion of the Shares, shall, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws. 

(c) The Company’s capitalization table attached hereto as Schedule 1 is true and complete as of the Issue Date. 

3.2 Notice of Certain Events. If the Company proposes at any time (a) to declare any dividend or distribution upon the
outstanding shares of the same class and series as the Shares, whether in cash, property, stock, or other securities and whether or not a regular cash dividend; (b) to offer for subscription or sale pro rata to the holders of the outstanding
shares of the same class and series as the Shares any additional shares of any class or series of the Company’s stock (other than pursuant to contractual pre-emptive rights); (c) to effect any reclassification, reorganization or
recapitalization of any of its stock; (d) to effect an Acquisition or to liquidate, dissolve or wind up; or (e) offer holders of registration rights the opportunity to participate in an underwritten public offering of the company’s
securities for cash, then, in connection with each such event, the Company shall give Holder: (1) at least 10 days prior written notice of the date on which a record will be taken for such dividend, distribution, or subscription rights (and
specifying the date on which the holders of shares of the same class and series as the Shares will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (c) and (d) above; (2) in the
case of the matters referred to in (c) and (d) above at least 10 days prior written notice of the date when the same will take place (and specifying the date on which the holders of shares of the same class and series as the Shares will be
entitled to exchange their shares for the securities or other property deliverable upon the occurrence of such event); and (3) in the case of the matter referred to in (e) above, the same notice as is given to the holders of such
registration rights. 

  
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 3.3 Registration Under Securities Act of 1933, as amended. The Company agrees that
the Shares or, if the Shares are convertible into Common Stock of the Company, such Common Stock, shall have certain incidental, or “Piggyback,” and S-3 registration rights pursuant to and as set forth in the Registration Rights Agreement
dated as of May 14, 2010 among the Company and the other parties named therein (as amended from time to time, the “Rights Agreement”). Upon the written request of the Company, Holder agrees to become a party to, and be bound by, the
Rights Agreement for purposes of the foregoing registration rights. Until such time (if any) as Holder becomes a party to the Rights Agreement, the provisions set forth in the Rights Agreement relating to the foregoing registration rights in effect
as of the Issue Date may not be amended, modified or waived without the prior written consent of Holder unless such amendment, modification or waiver affects the rights associated with the Shares in the same manner as such amendment, modification,
or waiver affects the rights associated with all other shares of the same series and class as the Shares granted to the Holder. 

3.4 No Shareholder Rights. Except as provided in this Warrant, Holder will not have any rights as a shareholder of the Company
until the exercise of this Warrant. 
 3.5 Certain Information. At all times prior to the earlier to occur of
(i) the IPO, or (ii) the Acquisition of the Company by an entity subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended, the Company agrees to provide Holder at any
time and from time to time with such information as Holder may reasonably request for purposes of Holder’s compliance with regulatory, accounting and reporting requirements applicable to Holder. Holder agrees to treat and hold all such
information provided by the Company in confidence in accordance with the provisions of Section 12.9 of the Loan Agreement (regardless of whether the Loan Agreement is still then in force and effect). 

ARTICLE 4. REPRESENTATIONS, WARRANTIES OF THE HOLDER. The Holder represents and warrants to the Company as follows: 

4.1 Purchase for Own Account. This Warrant and the securities to be acquired upon exercise of this Warrant by Holder will be
acquired for investment for Holder’s account, not as a nominee or agent, and not with a view to the public resale or distribution within the meaning of the Act. Holder also represents that it has not been formed for the specific purpose of
acquiring this Warrant or the Shares. 
 4.2 Disclosure of Information. Holder has received or has had full access to all
the information it considers necessary or appropriate to make an informed investment decision with respect to the acquisition of this Warrant and its underlying securities. Holder further has had an opportunity to ask questions and receive answers
from the Company regarding the terms and conditions of the offering of this Warrant and its underlying securities and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable
effort or expense) necessary to verify any information furnished to Holder or to which Holder has access. 
 4.3 Investment
Experience. Holder understands that the purchase of this Warrant and its underlying securities involves substantial risk. Holder has experience as an investor in securities of companies in the development stage and

  
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acknowledges that Holder can bear the economic risk of such Holder’s investment in this Warrant and its underlying securities and has such knowledge and experience in financial or business
matters that Holder is capable of evaluating the merits and risks of its investment in this Warrant and its underlying securities and/or has a preexisting personal or business relationship with the Company and certain of its officers, directors or
controlling persons of a nature and duration that enables Holder to be aware of the character, business acumen and financial circumstances of such persons. 
 4.4 Accredited Investor Status. Holder is an “accredited investor” within the meaning of Regulation D promulgated under the Act. 

4.5 The Act. Holder understands that this Warrant and the Shares issuable upon exercise or conversion hereof have not been
registered under the Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the Holder’s investment intent as expressed herein. Holder understands that this Warrant and the
Shares issued upon any exercise or conversion hereof must be held indefinitely unless subsequently registered under the Act and qualified under applicable state securities laws, or unless exemption from such registration and qualification are
otherwise available. 
 ARTICLE 5. MISCELLANEOUS. 
 5.1 Term: This Warrant is exercisable in whole or in part at any time and from time to time on or before the Expiration Date. 

5.2 Legends. This Warrant and the Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if
any) shall be imprinted with a legend in substantially the following form: 
 THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE
NOT BEEN REGISTERED UNDER THE ACT, OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO THE PROVISIONS OF ARTICLE 5 OF THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED BY THE COMPANY TO SILICON VALLEY BANK DATED AS OF MAY 16, 2011, MAY
NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE
SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION. 
 5.3 Compliance with
Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise of this Warrant (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) may not be transferred or assigned in whole or in part
without compliance with applicable federal and state securities laws by the transferor and the transferee (including, without limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to the Company, as
reasonably requested by the Company). The Company shall not require 

  
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Holder to provide an opinion of counsel if the transfer is to SVB Financial Group (Silicon Valley Bank’s parent company) or any other affiliate of Holder, provided that any such transferee
is an “accredited investor” as defined in Regulation D promulgated under the Act. 
 5.4 Transfer Procedure.
After receipt by Silicon Valley Bank (“Bank”) of the executed Warrant, Bank will transfer all of this Warrant to SVB Financial Group, Holder’s parent company. Subject to the provisions of Article 5.3 and upon providing the Company
with written notice, SVB Financial Group and any subsequent Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant (or the securities issuable directly or indirectly, upon conversion of the Shares, if
any) to any transferee, provided, however, in connection with any such transfer, SVB Financial Group or any subsequent Holder will give the Company notice of the portion of the Warrant being transferred with the name, address and taxpayer
identification number of the transferee and Holder will surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable). The Company may refuse to transfer this Warrant or the Shares to any person who directly
competes with the Company, unless, in either case, the stock of the Company is publicly traded. 
 5.5 Notices. All
notices and other communications from the Company to the Holder, or vice versa, shall be deemed delivered and effective when given personally or mailed by first-class registered or certified mail, postage prepaid, at such address as may have been
furnished to the Company or Holder, as the case may (or on the first business day after transmission by facsimile) be, in writing by the Company or such holder from time to time. All notices to Holder shall be addressed as follows until the Company
receives notice of a change of address in connection with a transfer or otherwise: 
 SVB Financial Group 

Attn: Treasury Department 
 3003 Tasman Drive, HA 200 
 Santa Clara, CA 95054 

Telephone: 408-654-7400 
 Facsimile: 408-496-2405 
 Notice to the Company shall be addressed as follows
until Holder receives notice of a change in address: 
 Tetraphase Pharmaceuticals, Inc. 

Attn: Chief Operating Officer 
 480 Arsenal Street, Suite 110 
 Watertown, MA 02462 

Telephone: 617-715-3551 
 Facsimile: 617-715-3557 

  
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 5.6 Amendment and Waiver. This Warrant and any term hereof may be amended, waived,
discharged or terminated only by an instrument in writing signed by the Company and the Holder. 
 5.7 Attorney’s
Fees. In the event of any dispute between the parties concerning the terms and provisions of this Warrant, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including
reasonable attorneys’ fees. 
 5.8 Automatic Conversion upon Expiration. In the event that, upon the Expiration
Date, the fair market value of one Share (or other security issuable upon the exercise hereof) as determined in accordance with Article 1.3 above is greater than the Warrant Price in effect on such date, then this Warrant shall automatically be
deemed on and as of such date to be converted pursuant to Article 1.2 above as to all Shares (or such other securities) for which it shall not previously have been exercised or converted, and the Company shall promptly deliver a certificate
representing the Shares (or such other securities) issued upon such conversion to Holder. 
 5.9 Counterparts. This
Warrant may be executed in counterparts, all of which together shall constitute one and the same agreement. 
 5.10 Governing
Law. This Warrant shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to its principles regarding conflicts of law. 

 

			
	“COMPANY”
	
	TETRAPHASE PHARMACEUTICALS, INC.
		
	By:	 	 /s/ David Lubner

		
	Name:	 	 David Lubner

		 	(Print)
	Title:	 	SVP, CEO
	
	“HOLDER”
	
	SILICON VALLEY BANK
		
	By:	 	 /s/ Kathleen Welsh

		
	Name:	 	 Kathleen Welsh

		 	(Print)
	Title:	 	Relationship Manager

  
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 APPENDIX 1 
 NOTICE OF EXERCISE 
 1. Holder elects to purchase
                 shares of the Common/Series          Preferred [strike one] Stock of
                     pursuant to the terms of the attached Warrant, and tenders payment of the purchase price of the shares in full. 

[or] 
 1.
Holder elects to convert the attached Warrant into Shares/cash [strike one] in the manner specified in the Warrant. This conversion is exercised for
                     of the Shares covered by the Warrant. 
 [Strike paragraph that does not apply.] 
 2. Please issue a certificate or
certificates representing the shares in the name specified below: 
  

	
	  

	 Holders Name

	
	  

	
	  

	 (Address)

 3. By its execution below and for the benefit of the Company, Holder hereby restates each of the
representations and warranties in Article 4 of the Warrant as the date hereof. 
  

			
	HOLDER:	 	
	
	  

			
		
	By:	 	  

		
	Name:	 	  

		
	Title:	 	  

		
	(Date):	 	  

  
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 SCHEDULE 1 
 Company Capitalization Table 
 See attached 

  
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 Tetraphase Pharmaceuticals, Inc. 

Capitalization Table 
  

									
	 Type of Security
	  	Number of Authorized
Shares	 	  	Number of
Outstanding Shares	 
	 Common Stock
	  	 	316,358,161	  	  	 	8,410,372	  
			
	 Series A-1 Convertible Participating Preferred Stock
	  	 	10,072,000	  	  	 	10,040,000	  
			
	 Series A-2 Convertible Participating Preferred Stock
	  	 	13,095,646	  	  	 	13,095,646	  
			
	 Series B Convertible Participating Preferred Stock
	  	 	57,471,225	  	  	 	57,471,225	  
			
	 Series C Convertible Participating Preferred Stock
	  	 	176,973,937	  	  	 	175,418,122	  

  
 12EX-10.5

 Exhibit 10.5 
 TETRAPHASE PHARMACEUTICALS, INC. 
 2006 STOCK INCENTIVE
PLAN1 

1. Purpose 
 The purpose
of this 2006 Stock Incentive Plan (the “Plan”) of Tetraphase Pharmaceuticals, Inc., a Delaware corporation (the “Company”), is to advance the interests of the Company’s stockholders by enhancing the Company’s ability to
attract, retain and motivate persons who are expected to make important contributions to the Company and by providing such persons with equity ownership opportunities and performance-based incentives that are intended to align their interests with
those of the Company’s stockholders. Except where the context otherwise requires, the term “Company” shall include any of the Company’s present or future parent or subsidiary corporations as defined in Sections 424(e) or
(f) of the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder (the “Code”) and any other business venture (including, without limitation, joint venture or limited liability company) in which the
Company has a controlling interest, as determined by the Board of Directors of the Company (the “Board”). 
 2. Eligibility

 All of the Company’s employees, officers, directors, consultants and advisors are eligible to receive options,
restricted stock, restricted stock units and other stock-based awards (each, an “Award”) under the Plan. Each person who receives an Award under the Plan is deemed a “Participant”. 

3. Administration and Delegation 
 (a) Administration by Board of Directors. The Plan will be administered by the Board. The Board shall have authority to grant Awards and to adopt, amend and repeal such administrative rules,
guidelines and practices relating to the Plan as it shall deem advisable. The Board may correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Award in the manner and to the extent it shall deem expedient to carry
the Plan into effect and it shall be the sole and final judge of such expediency. All decisions by the Board shall be made in the Board’s sole discretion and shall be final and binding on all persons having or claiming any interest in the Plan
or in any Award. No director or person acting pursuant to the authority delegated by the Board shall be liable for any action or determination relating to or under the Plan made in good faith. 

(b) Appointment of Committees. To the extent permitted by applicable law, the Board may delegate any or all of its powers under
the Plan to one or more committees or subcommittees of the Board (a “Committee”). All references in the Plan to the “Board” shall mean the Board or a Committee of the Board or the officers referred to in Section 3(c) to the
extent that the Board’s powers or authority under the Plan have been delegated to such Committee or officers. 
  

	1 	 As amended May 14, 2010. 

 (c) Delegation to Officers. To the extent permitted by applicable law, the Board may
delegate to one or more officers of the Company the power to grant Awards to employees or officers of the Company or any of its present or future subsidiary corporations and to exercise such other powers under the Plan as the Board may determine,
provided that the Board shall fix the terms of the Awards to be granted by such officers (including the exercise price of such Awards, which may include a formula by which the exercise price will be determined) and the maximum number of shares
subject to Awards that the officers may grant; provided further, however, that no officer shall be authorized to grant Awards to any “executive officer” of the Company (as defined by Rule 3b-7 under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)) or to any “officer” of the Company (as defined by Rule 16a-1 under the Exchange Act). 
 4.
Stock Available for Awards. Subject to adjustment under Section 8, Awards may be made under the Plan for up to 53,745,353 shares of common stock, $0.001 par value per share, of the Company (the “Common Stock”). If any Award
expires or is terminated, surrendered or canceled without having been fully exercised or is forfeited in whole or in part (including as the result of shares of Common Stock subject to such Award being repurchased by the Company at the original
issuance price pursuant to a contractual repurchase right) or results in any Common Stock not being issued, the unused Common Stock covered by such Award shall again be available for the grant of Awards under the Plan. Further, shares of Common
Stock tendered to the Company by a Participant to exercise an Award shall be added to the number of shares of Common Stock available for the grant of Awards under the Plan. However, in the case of Incentive Stock Options (as hereinafter defined),
the foregoing provisions shall be subject to any limitations under the Code. Shares issued under the Plan may consist in whole or in part of authorized but unissued shares or treasury shares. 
 5. Stock Options 
 (a) General. The Board may grant options to
purchase Common Stock (each, an “Option”) and determine the number of shares of Common Stock to be covered by each Option, the exercise price of each Option and the conditions and limitations applicable to the exercise of each Option,
including conditions relating to applicable federal or state securities laws, as it considers necessary or advisable. An Option which is not intended to be an Incentive Stock Option (as hereinafter defined) shall be designated a “Nonstatutory
Stock Option”. 
 (b) Incentive Stock Options. An Option that the Board intends to be an “incentive stock
option” as defined in Section 422 of the Code (an “Incentive Stock Option”) shall only be granted to employees of Tetraphase Pharmaceuticals, Inc., any of its present or future parent or subsidiary corporations as defined in
Sections 424(e) or (f) of the Code, and any other entities the employees of which are eligible to receive Incentive Stock Options under the Code, and shall be subject to and shall be construed consistently with the requirements of
Section 422 of the Code. The Company shall have no liability to a Participant, or any other party, if an Option (or any part thereof) that is intended to be an Incentive Stock Option is not an Incentive Stock Option or for any action taken by
the Board pursuant to Section 9(f), including without limitation the conversion of an Incentive Stock Option to a Nonstatutory Stock Option. 

  
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 (c) Exercise Price. The Board shall establish the exercise price of each Option and
specify such exercise price in the applicable option agreement. 
 (d) Duration of Options. Each Option shall be
exercisable at such times and subject to such terms and conditions as the Board may specify in the applicable option agreement. 

(e) Exercise of Option. Options may be exercised by delivery to the Company of a written notice of exercise signed by the proper
person or by any other form of notice (including electronic notice) approved by the Board together with payment in full as specified in Section 5(f) for the number of shares for which the Option is exercised. Shares of Common Stock subject to
the Option will be delivered by the Company following exercise either as soon as practicable or, subject to such conditions as the Board shall specify, on a deferred basis (with the Company’s obligation to be evidenced by an instrument
providing for future delivery of the deferred shares at the time or times specified by the Board). 
 (f) Payment Upon
Exercise. Common Stock purchased upon the exercise of an Option granted under the Plan shall be paid for as follows: 
 (1)
in cash or by check, payable to the order of the Company; 
 (2) except as the Board may otherwise provide in an option
agreement, by (i) delivery of an irrevocable and unconditional undertaking by a creditworthy broker to deliver promptly to the Company sufficient funds to pay the exercise price and any required tax withholding or (ii) delivery by the
Participant to the Company of a copy of irrevocable and unconditional instructions to a creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the exercise price and any required tax withholding; 

(3) when the Common Stock is registered under the Exchange Act, by delivery of shares of Common Stock owned by the Participant valued at
their fair market value as determined by (or in a manner approved by) the Board (“Fair Market Value”), provided (i) such method of payment is then permitted under applicable law, (ii) such Common Stock, if acquired directly from
the Company, was owned by the Participant for such minimum period of time, if any, as may be established by the Board in its discretion and (iii) such Common Stock is not subject to any repurchase, forfeiture, unfulfilled vesting or other
similar requirements; 
 (4) to the extent permitted by applicable law and by the Board, by (i) delivery of a promissory
note of the Participant to the Company on terms determined by the Board, or (ii) payment of such other lawful consideration as the Board may determine; or 
 (5) by any combination of the above permitted forms of payment. 
 (g)
Substitute Options. In connection with a merger or consolidation of an entity with the Company or the acquisition by the Company of property or stock of an entity, the Board may grant Options in substitution for any options or other stock or
stock-based awards granted by such entity or an affiliate thereof. Substitute Options may be granted on such terms as the Board deems appropriate in the circumstances, notwithstanding any limitations on Options contained in the other sections of
this Section 5 or in Section 2. Substitute Options shall not count against the overall share limit set forth in Section 4(a), except as may be required by reason of Section 422 and related provisions of the Code. 

  
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 (h) Repricing of Options. The Board may, without stockholder approval, amend any
outstanding Option granted under the Plan to provide an exercise price per share that is lower than the then-current exercise price per share of such outstanding Option. The Board may also, without stockholder approval, cancel any outstanding option
(whether or not granted under the Plan) and grant in substitution therefor new Awards under the Plan covering the same or a different number of shares of Common Stock and having an exercise price per share lower than the then-current exercise price
per share of the cancelled option. 
 6. Restricted Stock; Restricted Stock Units 

(a) General. The Board may grant Awards entitling recipients to acquire shares of Common Stock (“Restricted Stock”),
subject to the right of the Company to repurchase all or part of such shares at their issue price or other stated or formula price (or to require forfeiture of such shares if issued at no cost) from the recipient in the event that conditions
specified by the Board in the applicable Award are not satisfied prior to the end of the applicable restriction period or periods established by the Board for such Award. Instead of granting Awards for Restricted Stock, the Board may grant Awards
entitling the recipient to receive shares of Common Stock to be delivered at the time such shares of Common Stock vest (“Restricted Stock Units”) (Restricted Stock and Restricted Stock Units are each referred to herein as a
“Restricted Stock Award”). 
 (b) Terms and Conditions. The Board shall determine the terms and conditions of a
Restricted Stock Award, including the conditions for repurchase (or forfeiture) and the issue price, if any. 
 (c) Stock
Certificates. Any stock certificates issued in respect of a Restricted Stock Award shall be registered in the name of the Participant and, unless otherwise determined by the Board, deposited by the Participant, together with a stock power
endorsed in blank, with the Company (or its designee). At the expiration of the applicable restriction periods, the Company (or such designee) shall deliver the certificates no longer subject to such restrictions to the Participant or if the
Participant has died, to the beneficiary designated, in a manner determined by the Board, by a Participant to receive amounts due or exercise rights of the Participant in the event of the Participant’s death (the “Designated
Beneficiary”). In the absence of an effective designation by a Participant, “Designated Beneficiary” shall mean the Participant’s estate. 
 7. Other Stock-Based Awards 
 Other Awards of shares of Common Stock, and
other Awards that are valued in whole or in part by reference to, or are otherwise based on, shares of Common Stock or other property, may be granted hereunder to Participants (“Other Stock Unit Awards”), including without limitation stock
appreciation rights and Awards entitling recipients to receive shares of Common Stock to be delivered in the future. Such Other Stock Unit Awards shall also be available as a form of payment in the settlement of other Awards granted under the Plan
or as payment in lieu of compensation to which a Participant is otherwise entitled. Other Stock Unit Awards may be 

  
 4 

 
paid in shares of Common Stock or cash, as the Board shall determine. Subject to the provisions of the Plan, the Board shall determine the conditions of each Other Stock Unit Award, including any
purchase price applicable thereto. 
 8. Adjustments for Changes in Common Stock and Certain Other Events 

(a) Changes in Capitalization. In the event of any stock split, reverse stock split, stock dividend, recapitalization, combination
of shares, reclassification of shares, spin-off or other similar change in capitalization or event, or any distribution to holders of Common Stock other than an ordinary cash dividend, (i) the number and class of securities available under this
Plan, (ii) the number and class of securities and exercise price per share of each outstanding Option, (iii) the repurchase price per share subject to each outstanding Restricted Stock Award, and (iv) the terms of each other
outstanding Award shall be appropriately adjusted by the Company (or substituted Awards may be made, if applicable) to the extent determined by the Board. 
 (b) Reorganization Events 
 (1) Definition. A “Reorganization
Event” shall mean: (a) any merger or consolidation of the Company with or into another entity as a result of which all of the Common Stock of the Company is converted into or exchanged for the right to receive cash, securities or other
property or is cancelled, (b) any exchange of all of the Common Stock of the Company for cash, securities or other property pursuant to a share exchange transaction or (c) any liquidation or dissolution of the Company. 

(2) Consequences of a Reorganization Event on Awards Other than Restricted Stock Awards. In connection with a Reorganization
Event, the Board shall take any one or more of the following actions as to all or any outstanding Awards on such terms as the Board determines: (i) provide that Awards shall be assumed, or substantially equivalent Awards shall be substituted,
by the acquiring or succeeding corporation (or an affiliate thereof), (ii) upon written notice to a Participant, provide that the Participant’s unexercised Options or other unexercised Awards shall become exercisable in full and will
terminate immediately prior to the consummation of such Reorganization Event unless exercised by the Participant within a specified period following the date of such notice, (iii) provide that outstanding Awards shall become realizable or
deliverable, or restrictions applicable to an Award shall lapse, in whole or in part prior to or upon such Reorganization Event, (iv) in the event of a Reorganization Event under the terms of which holders of Common Stock will receive upon
consummation thereof a cash payment for each share surrendered in the Reorganization Event (the “Acquisition Price”), make or provide for a cash payment to a Participant equal to (A) the Acquisition Price times the number of shares of
Common Stock subject to the Participant’s Options or other Awards (to the extent the exercise price does not exceed the Acquisition Price) minus (B) the aggregate exercise price of all such outstanding Options or other Awards, in exchange
for the termination of such Options or other Awards, (v) provide that, in connection with a liquidation or dissolution of the Company, Awards shall convert into the right to receive liquidation proceeds (if applicable, net of the exercise price
thereof) and (vi) any combination of the foregoing. 

  
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 For purposes of clause (i) above, an Option shall be considered assumed if, following
consummation of the Reorganization Event, the Option confers the right to purchase, for each share of Common Stock subject to the Option immediately prior to the consummation of the Reorganization Event, the consideration (whether cash, securities
or other property) received as a result of the Reorganization Event by holders of Common Stock for each share of Common Stock held immediately prior to the consummation of the Reorganization Event (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of the outstanding shares of Common Stock); provided, however, that if the consideration received as a result of the Reorganization Event is not solely common stock of the
acquiring or succeeding corporation (or an affiliate thereof), the Company may, with the consent of the acquiring or succeeding corporation, provide for the consideration to be received upon the exercise of Options to consist solely of common stock
of the acquiring or succeeding corporation (or an affiliate thereof) equivalent value (as determined by the Board) to the per share consideration received by holders of outstanding shares of Common Stock as a result of the Reorganization Event.

 To the extent all or any portion of an Option becomes exercisable solely as a result of clause (ii) above, the Board may
provide that upon exercise of such Option the Participant shall receive shares subject to a right of repurchase by the Company or its successor at the Option exercise price; such repurchase right (x) shall lapse at the same rate as the Option
would have become exercisable under its terms and (y) shall not apply to any shares subject to the Option that were exercisable under its terms without regard to clause (ii) above. 

(3) Consequences of a Reorganization Event on Restricted Stock Awards. Upon the occurrence of a Reorganization Event other than a
liquidation or dissolution of the Company, the repurchase and other rights of the Company under each outstanding Restricted Stock Award shall inure to the benefit of the Company’s successor and shall apply to the cash, securities or other
property which the Common Stock was converted into or exchanged for pursuant to such Reorganization Event in the same manner and to the same extent as they applied to the Common Stock subject to such Restricted Stock Award. Upon the occurrence of a
Reorganization Event involving the liquidation or dissolution of the Company, except to the extent specifically provided to the contrary in the instrument evidencing any Restricted Stock Award or any other agreement between a Participant and the
Company, all restrictions and conditions on all Restricted Stock Awards then outstanding shall automatically be deemed terminated or satisfied. 

9. General Provisions Applicable to Awards 
 (a) Transferability of Awards. Except as the Board may otherwise determine or provide in an Award, Awards shall not be sold, assigned, transferred, pledged or otherwise encumbered by the person to
whom they are granted, either voluntarily or by operation of law, except by will or the laws of descent and distribution or, other than in the case of an Incentive Stock Option, pursuant to a qualified domestic relations order, and, during the life
of the Participant, shall be exercisable only by the Participant. References to a Participant, to the extent relevant in the context, shall include references to authorized transferees. 

  
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 (b) Documentation. Each Award shall be evidenced in such form (written, electronic or
otherwise) as the Board shall determine. Each Award may contain terms and conditions in addition to those set forth in the Plan. 
 (c) Board Discretion. Except as otherwise provided by the Plan, each Award may be made alone or in addition or in relation to any other Award. The terms of each Award need not be identical, and the
Board need not treat Participants uniformly. 
 (d) Termination of Status. The Board shall determine the effect on an
Award of the disability, death, retirement, authorized leave of absence or other change in the employment or other status of a Participant and the extent to which, and the period during which, the Participant, or the Participant’s legal
representative, conservator, guardian or Designated Beneficiary, may exercise rights under the Award. 
 (e) Withholding.
Each Participant shall pay to the Company, or make provision satisfactory to the Company for payment of, any taxes required by law to be withheld in connection with an Award to such Participant. Except as the Board may otherwise provide in an Award,
for so long as the Common Stock is registered under the Exchange Act, Participants may satisfy such tax obligations in whole or in part by delivery of shares of Common Stock, including shares retained from the Award creating the tax obligation,
valued at their Fair Market Value; provided, however, except as otherwise provided by the Board, that the total tax withholding where stock is being used to satisfy such tax obligations cannot exceed the Company’s minimum statutory withholding
obligations (based on minimum statutory withholding rates for federal and state tax purposes, including payroll taxes, that are applicable to such supplemental taxable income). Shares surrendered to satisfy tax withholding requirements cannot be
subject to any repurchase, forfeiture, unfulfilled vesting or other similar requirements. The Company may, to the extent permitted by law, deduct any such tax obligations from any payment of any kind otherwise due to a Participant. 

(f) Amendment of Award. The Board may amend, modify or terminate any outstanding Award, including but not limited to, substituting
therefor another Award of the same or a different type, changing the date of exercise or realization, and converting an Incentive Stock Option to a Nonstatutory Stock Option, provided that the Participant’s consent to such action shall be
required unless the Board determines that the action, taking into account any related action, would not materially and adversely affect the Participant. 
 (g) Conditions on Delivery of Stock. The Company will not be obligated to deliver any shares of Common Stock pursuant to the Plan or to remove restrictions from shares previously delivered under
the Plan until (i) all conditions of the Award have been met or removed to the satisfaction of the Company, (ii) in the opinion of the Company’s counsel, all other legal matters in connection with the issuance and delivery of such
shares have been satisfied, including any applicable securities laws and any applicable stock exchange or stock market rules and regulations, and (iii) the Participant has executed and delivered to the Company such representations or agreements
as the Company may consider appropriate to satisfy the requirements of any applicable laws, rules or regulations. 

  
 7 

 (h) Acceleration. The Board may at any time provide that any Award shall become
immediately exercisable in full or in part, free of some or all restrictions or conditions, or otherwise realizable in full or in part, as the case may be. 
 10. Miscellaneous 
 (a) No Right To Employment or Other Status. No
person shall have any claim or right to be granted an Award, and the grant of an Award shall not be construed as giving a Participant the right to continued employment or any other relationship with the Company. The Company expressly reserves the
right at any time to dismiss or otherwise terminate its relationship with a Participant free from any liability or claim under the Plan, except as expressly provided in the applicable Award. 

(b) No Rights As Stockholder. Subject to the provisions of the applicable Award, no Participant or Designated Beneficiary shall
have any rights as a stockholder with respect to any shares of Common Stock to be distributed with respect to an Award until becoming the record holder of such shares. Notwithstanding the foregoing, in the event the Company effects a split of the
Common Stock by means of a stock dividend and the exercise price of and the number of shares subject to such Option are adjusted as of the date of the distribution of the dividend (rather than as of the record date for such dividend), then an
optionee who exercises an Option between the record date and the distribution date for such stock dividend shall be entitled to receive, on the distribution date, the stock dividend with respect to the shares of Common Stock acquired upon such
Option exercise, notwithstanding the fact that such shares were not outstanding as of the close of business on the record date for such stock dividend. 
 (c) Effective Date and Term of Plan. The Plan shall become effective on the date on which it is adopted by the Board. No Awards shall be granted under the Plan after the completion of 10 years from
the earlier of (i) the date on which the Plan was adopted by the Board or (ii) the date the Plan was approved by the Company’s stockholders, but Awards previously granted may extend beyond that date. 

(d) Amendment of Plan. The Board may amend, suspend or terminate the Plan or any portion thereof at any time. 

(e) Authorization of Sub-Plans. The Board may from time to time establish one or more sub-plans under the Plan for purposes of
satisfying applicable blue sky, securities or tax laws of various jurisdictions. The Board shall establish such sub-plans by adopting supplements to this Plan containing (i) such limitations on the Board’s discretion under the Plan as the
Board deems necessary or desirable or (ii) such additional terms and conditions not otherwise inconsistent with the Plan as the Board shall deem necessary or desirable. All supplements adopted by the Board shall be deemed to be part of the
Plan, but each supplement shall apply only to Participants within the affected jurisdiction and the Company shall not be required to provide copies of any supplement to Participants in any jurisdiction which is not the subject of such supplement.

 (f) Compliance with Code Section 409A. No Award shall provide for deferral of compensation that does not comply
with Section 409A of the Code, unless the Board, at the time of grant, specifically provides that the Award is not intended to comply with Section 409A of the Code. 

  
 8 

 (g) Governing Law. The provisions of the Plan and all Awards made hereunder shall be
governed by and interpreted in accordance with the laws of the State of Delaware, excluding choice-of-law principles of the law of such state that would require the application of the laws of a jurisdiction other than such state. 

  
 9

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