TERN Terns Pharmaceuticals Inc

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Appointment of Ann E. Taylor to the Board of Directors

On September 28, 2021, the Board of Directors (the “Board”) of Terns Pharmaceuticals, Inc. (the “Company”) appointed Ann E. Taylor, M.D. to serve as a Class I director until her successor is duly elected and qualified or until her earlier death, resignation or removal.

There is no arrangement or understanding between Dr. Taylor and any other person pursuant to which she was appointed as a director of the Company, and there are no family relationships between Dr. Taylor and any of the Company’s directors or executive officers. There are no transactions to which the Company is a party and in which Dr. Taylor has a direct or indirect material interest that would be required to be disclosed under Item 404(a) of Regulation S-K.

Dr. Taylor will be eligible to participate in the Company’s amended and restated compensation program for the Company’s non-employee directors (the “Director Compensation Program”). The Director Compensation Program provides for cash compensation as follows:

In addition, the Director Compensation Programs provides that each non-employee director will automatically be granted an option to purchase 44,000 shares of common stock upon the director’s initial appointment or election to the Board (the “Initial Grant”). Each non-employee director who has served for at least six months will be granted an option to purchase 22,000 shares of common stock automatically on the date of each annual stockholder’s meeting thereafter (the “Annual Grant”). The Initial Grant will vest as to 1/3rd of the total shares subject thereto on the first anniversary of the applicable date of grant and as to 1/36th of the total shares subject thereto on each monthly anniversary of the applicable date of grant over the next 24 months thereafter, subject to continued service through each applicable vesting date. The Annual Grant will vest on the earlier of the first anniversary of the date of grant or the date of the next annual stockholder’s meeting to the extent unvested as of such date, subject to continued service through each applicable vesting date. Each Initial Grant and Annual Grant will vest in full in the event of a change in control.