Form 4: TERN CEO Burroughs Reports Stock Transactions

Terns Pharmaceuticals CEO Amy L. Burroughs reported the exercise of stock options and vesting of restricted stock units, alongside a tax-related sale of shares.

Summary

• Amy L. Burroughs, Chief Executive Officer and Director of Terns Pharmaceuticals, Inc. [TERN], reported several transactions involving the company's common stock.
• On January 2, 2026, Burroughs acquired 21,551 shares of common stock at an exercise price of $4.64 per share through the exercise of stock options.
• On January 5, 2026, 150,000 restricted stock units (RSUs) vested, resulting in the acquisition of 150,000 shares of common stock. These RSUs were granted on March 1, 2024, and vested because the average closing price of TERN's common stock met performance criteria of exceeding $15.00 and $20.00 per share over 30 consecutive trading days.
• Concurrently on January 5, 2026, Burroughs sold 71,339 shares of common stock at a weighted average price of $38.103 per share to satisfy tax obligations related to the RSU vesting. This sale was explicitly stated as not a discretionary trade.
• Following these transactions, Burroughs directly owns 138,976 shares of common stock and indirectly owns 8,319 shares through the Amy L Burroughs 2017 Trust.
• A total of 1,053,449 stock options remain beneficially owned directly.

Sentiment

Score: 6

Explanation: The sentiment is slightly positive as the RSU vesting indicates the company met significant performance milestones, and the option exercise reflects value realization. The share sale is non-discretionary for tax purposes, making the overall event routine for an executive.

Positives

• The vesting of 150,000 restricted stock units indicates that Terns Pharmaceuticals' common stock met significant pre-defined performance criteria, specifically average closing prices exceeding $15.00 and $20.00 per share over 30 consecutive trading days.
• The exercise of 21,551 stock options at $4.64 per share suggests the executive is realizing value from previously granted equity awards, implying a favorable stock price relative to the exercise price.

Negatives

• The sale of 71,339 shares of common stock, even if for tax purposes, reduces the direct beneficial ownership of the CEO in the company.

Future Outlook

NA

Industry Context

NA

Stakeholder Impact

• Shareholders may view the RSU vesting as a positive signal that the company has met its performance targets, potentially reinforcing confidence in management's ability to drive value.
• The transactions are routine for an executive and are unlikely to have a significant direct impact on employees, customers, suppliers, or creditors.

Next Steps

• The remaining stock options will continue to vest monthly, with 1/48th of the total shares vesting monthly after the first anniversary of January 1, 2025, until fully vested on the fourth anniversary.

Key Dates

Recommendation

This Form 4 details routine insider transactions, specifically the exercise of stock options and the vesting of restricted stock units, followed by a non-discretionary sale for tax purposes. While the RSU vesting indicates the company met performance milestones, these events are generally pre-scheduled and do not introduce new fundamental information that would warrant a change in investment recommendation. Therefore, a 'hold' recommendation is appropriate as the filing does not alter the underlying investment thesis.

Keywords

Terns Pharmaceuticals, TERN, Form 4, Insider Transaction, Stock Options, Restricted Stock Units, CEO, Beneficial Ownership