[8-K] Terns Pharmaceuticals, Inc. Reports Material Event

Rhea-AI Filing Summary

Exela Technologies, Inc. and its controlled entities (XCV-STS, LLC and GP 3XCV LLC) filed a Schedule 13D disclosing equity obtained through XBP Global Holdings, Inc.’s Chapter 11 restructuring completed on 29 Jul 2025.

• Exela now beneficially owns 33,669,980 shares/warrants, equal to 27.08 % of XBP’s 117,715,369 outstanding shares.
• Executive Chairman Par Chadha personally holds another 2,357,260 shares; combined with Exela’s stake, he controls 36,027,240 shares/warrants or 28.97 % of the company.
• Ownership arose from conversion of Allowed Notes Claims and a Membership Interest Purchase Agreement executed during the court-approved restructuring. Subsidiaries received 25.4 m common shares plus 6.63 m warrant shares; warrants’ terms are filed as Exhibit 99.3.

The shares received are pledged as security for potential tax obligations tied to the restructuring. A Tax Funding Agreement obligates Exela affiliates to pay the first $15 m and any liability above $25 m. A Registration Rights Agreement grants shelf, demand and piggy-back rights for future resale. No other purpose or immediate plans (e.g., takeover, board changes) are stated beyond investment and fulfillment of court-mandated arrangements.

Post-transaction, XBP’s shareholder base is highly concentrated, giving Exela/Chadha significant influence while leaving 71 % in public or other hands.

Positive

• Debt-to-equity conversion eliminates a portion of XBP’s 11.5 % 2026 notes, reducing leverage post-bankruptcy.
• Exela/Chadha’s 29 % stake may align interests between a strategic partner and XBP, potentially aiding operational support.
• Registration Rights Agreement improves future liquidity for large holders, lowering overhang uncertainty once shares are registered.

Negative

• High ownership concentration (≈29 %) increases governance control risk for minority shareholders.
• All pledged shares secure up to $25 m+ tax liabilities, creating potential forced-sale or encumbrance scenarios.
• Possible future share sales by Exela once registration becomes effective could pressure the stock’s float and price.

Insights

Corporate Governance Expert

TL;DR – Restructuring gives Exela/Chadha 29 % control of XBP, improving alignment but raising concentration and tax-pledge risks.

The filing formalises a court-driven debt-to-equity swap, converting Exela’s 2026 note claims into 27 % equity plus warrants. Coupled with Chadha’s direct holdings, effective control nears 29 %. Investors gain clarity on cap-table and future dilution: all counts are based on 117.7 m shares, fully reflecting 6.6 m warrant shares. The Registration Rights Agreement hints at potential secondary sales once lock-ups lapse, affecting float. Pledge of shares to satisfy up to >$25 m of transaction tax liability introduces encumbrance risk. Overall impact is strategic but not immediately value-changing; governance influence is enhanced, yet concentration could deter minority investors.

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 05, 2025

Terns Pharmaceuticals, Inc.

(Exact name of Registrant as Specified in Its Charter)

Delaware			001-39926	98-1448275
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
1065 East Hillsdale Blvd. Suite 100
Foster City, California				94404
(Address of Principal Executive Offices)				(Zip Code)

Registrant’s Telephone Number, Including Area Code: (650) 525-5535

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.0001 par value per share		TERN		Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02 Results of Operations and Financial Condition.

On August 5, 2025, Terns Pharmaceuticals, Inc. issued a press release announcing its financial results for the quarter ended June 30, 2025. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.

The information contained in Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.		Description
99.1		Press Release issued by Terns Pharmaceuticals, Inc. on August 5, 2025.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	TERNS PHARMACEUTICALS, INC.
Date: August 5, 2025	By:	/s/ Caryn McDowell
		Caryn McDowell
		Chief Legal Officer and Corporate Secretary

FAQ

How much of XBP Global Holdings (XBPEW) does Exela now own?

Exela and its subsidiaries beneficially own 33,669,980 shares/warrants, representing 27.08 % of outstanding common stock.

What is Par Chadha’s total beneficial ownership in XBP?

Including personal holdings and Exela’s stake, Chadha controls 36,027,240 shares/warrants, or 28.97 % of XBP.

How were the shares acquired?

They were issued on 29 Jul 2025 through a Chapter 11 plan converting 2026 note claims and via a membership interest purchase.

Are the new shares subject to any restrictions?

Yes. They are pledged to cover restructuring tax liabilities and are covered by a Registration Rights Agreement for future resale.

What potential dilution exists from warrants?

Exela holds 6,632,418 warrant shares; if exercised, XBP’s share count would rise accordingly, diluting existing holders.