Form 4: Terns Pharma CEO Sells Stock Under 10b5-1 Plan

Terns Pharmaceuticals CEO Amy L. Burroughs reported the exercise of stock options and subsequent sale of common stock totaling 14,583 shares under a pre-arranged 10b5-1 trading plan.

Summary

• Amy L. Burroughs, Chief Executive Officer and Director of Terns Pharmaceuticals, Inc. (TERN), reported transactions on February 17, 2026.
• Burroughs exercised stock options to acquire 14,583 shares of common stock at an exercise price of $4.64 per share.
• Concurrently, Burroughs sold a total of 14,583 shares of common stock in three separate transactions.
• The sales occurred at weighted average prices of $38.0668 (2,341 shares), $39.216 (8,159 shares), and $39.7995 (4,083 shares).
• All reported transactions were executed pursuant to a Rule 10b5-1 trading plan adopted by Burroughs on June 30, 2025.
• Following these transactions, Burroughs directly owns 288,976 shares of common stock and indirectly owns 8,319 shares through the Amy L Burroughs 2017 Trust.
• Burroughs also holds 970,117 derivative securities in the form of stock options.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this as a routine insider transaction under a pre-arranged plan, which typically has a neutral impact on sentiment as it's not indicative of new company-specific news or a change in the executive's confidence in the company.

Positives

• The transactions were conducted under a Rule 10b5-1 trading plan, indicating pre-planned activity and reducing concerns about opportunistic insider trading.
• The exercise of options suggests the executive is realizing value from previously granted equity compensation.

Negatives

• The sale of common stock by a key executive, even if pre-planned, can sometimes be perceived negatively by investors, though it is a common practice for diversification and personal financial management.

Future Outlook

This filing does not contain any forward-looking statements or guidance regarding the company's future performance or outlook.

Industry Context

StockSavvy.ai notes that insider transactions, particularly sales by executives, are a routine part of managing personal finances, diversifying portfolios, and exercising equity compensation. The execution under a Rule 10b5-1 plan is a standard practice designed to allow insiders to sell shares without being accused of trading on material non-public information, as the plan is established in advance.

Related Party Transactions

• The Reporting Person beneficially owns 8,319 shares indirectly through the Amy L Burroughs 2017 Trust.

Stakeholder Impact

• Shareholders: Minimal direct impact as these are routine, pre-planned transactions by an executive, not indicative of new company performance information.
• Employees: No direct impact mentioned.

Next Steps

• 25% of the shares subject to the option vest on the first anniversary measured from January 1, 2025, and 1/48th of the total number of shares vest monthly thereafter, such that 100% of the shares subject to the option will be fully vested on the fourth anniversary of the Vesting Commencement Date.

Key Dates

Recommendation

The filing details a pre-scheduled insider transaction (exercise and sale) by the CEO under a 10b5-1 plan. Such routine transactions are generally not indicative of a change in the company's fundamental outlook or performance, thus a 'hold' recommendation is appropriate as it doesn't provide new information to warrant a change in investment thesis.

Keywords

Terns Pharmaceuticals, TERN, Form 4, insider trading, stock option exercise, stock sale, 10b5-1 plan, Amy L. Burroughs, CEO, director