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Form 10-Q Verastem, Inc. For: Jun 30

August 2, 2021 4:19 PM EDT

Exhibit 10.2

Name:

[_________]

Number of Shares of Stock subject to the Stock Option:

[_________]

Exercise Price Per Share:

$[_________]

Date of Grant:

[_________]

Vesting Commencement Date:

[_________]

VERASTEM, INC.
2021 Equity Incentive Plan

Incentive Stock Option Agreement

This agreement (this “Agreement”) evidences a stock option granted by Verastem, Inc., a Delaware corporation (the “Company”), to the individual named above (the “Participant”), pursuant to and subject to the terms of the Verastem, Inc. 2021 Equity Incentive Plan (as from time to time amended and in effect, the “Plan”).  Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.

1.Grant of Stock Option.  On the date of grant set forth above (the “Date of Grant”), the Company granted to the Participant an option (the “Stock Option”) to purchase, pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, up to the number of shares of Stock set forth above (the “Shares”), with an exercise price per Share as set forth above, in each case, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof.  

The Stock Option evidenced by this Agreement is intended to be treated as an ISO to the maximum extent provided under the Code. To the extent the Stock Option does not qualify as an ISO, the Stock Option will be treated as an NSO. The Participant acknowledges and agrees that the Administrator may take any action permitted under the Plan without regard to the effect such action may have on the status of the Stock Option as an ISO and that such action may cause the Stock Option to fail to be treated as an ISO. Without limiting the Plan, the Administrator shall have no liability with respect to any action taken by it that causes the Stock Option to fail to be treated as an ISO. To the extent that the aggregate Fair Market Value (determined at the time of grant) of the Shares subject to the Stock Option and all other ISOs the Participant holds that are exercisable for the first time during any calendar year (under all plans of the Company and its subsidiaries) exceeds $100,000, the stock options held by the Participant or portions thereof that exceed such limit (according to the order in which they were granted in accordance with Section 422) will be treated as NSOs.

2.Vesting.  The term “vest” as used herein with respect to the Stock Option or any portion thereof means to become exercisable and the term “vested” as used herein with respect to the Stock Option (or any portion thereof) means that the Stock Option (or portion thereof) is then exercisable.  Unless earlier terminated, forfeited, relinquished or expired, the Stock Option will vest as to [  ] (rounded down on each vesting date to the nearest whole Share, with the Stock Option becoming 100% vested on the final vesting date), in each case, subject to the Participant’s continued Employment through the applicable vesting date.  In the event of a Change in Control, the Stock Option, to the extent outstanding and unvested immediately prior to such Change in


Control, will become fully vested immediately prior to (and subject to the consummation of) such Change in Control. For purposes of this Agreement, “Change in Control” shall mean (i) the acquisition of beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) directly or indirectly by any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) of securities of the Company representing a majority or more of the combined voting power of the Company’s then outstanding securities, other than an acquisition of securities for investment purposes pursuant to a bona fide financing of the Company; (ii) a merger or consolidation of the Company with any other corporation in which the holders of the voting securities of the Company prior to the merger or consolidation do not own more than fifty (50) percent of the total voting securities of the surviving corporation; or (iii) the sale or disposition by the Company of all or substantially all of the Company’s assets other than a sale or disposition of assets to an affiliate of the Company or a holder of securities of the Company.
3.Exercise of the Stock Option.  No portion of the Stock Option may be exercised until such portion vests.  Each election to exercise any vested portion of the Stock Option will be subject to the terms and conditions of the Plan and must be in written or electronic form acceptable to the Administrator, signed (including by electronic signature) by the Participant or, if at the relevant time the Stock Option has passed to the estate or beneficiary of the Participant or a permitted transferee, by such estate or beneficiary or permitted transferee.  Each such written or electronic exercise election must be received by the Company at its principal office or at such other place or by such other party as the Administrator may prescribe and must be accompanied by payment in full of the exercise price by cash or check, through a broker-assisted exercise program acceptable to the Administrator, or as otherwise provided in the Plan consistent with the regulations promulgated under Section 424 of the Code.  Subject to earlier termination as set forth herein or in the Plan (including Section 6(a)(4) of the Plan), the latest date on which the Stock Option or any portion thereof may be exercised is the tenth (10th) anniversary (or the fifth (5th) anniversary, in the case of a 10-percent stockholder within the meaning of Section 422(b)(6) of the Code) of the Date of Grant (the “Final Exercise Date”) and, if not exercised on or prior to such date, the Stock Option or any remaining portion thereof will thereupon immediately terminate.
4.Cessation of Employment. If the Participant’s Employment ceases for any reason, except as expressly provided for in a written agreement between the Participant and the Company or one of its affiliates that is in effect at the time of such cessation of Employment, the Stock Option, to the extent not then vested, will be immediately forfeited for no consideration, and any vested portion of the Stock Option that is then outstanding will remain exercisable for the period, if any, described in Section 6(a)(4) of the Plan.  The Participant acknowledges and agrees that in the event any portion of the Stock Option is exercised after the date that is three (3) months after the date of the Participant’s employment with the Company and its subsidiaries ceases (subject to certain exceptions in the case of the Participant’s death), or any portion of the exercise price is satisfied through a broker-assisted exercise program, the Participant will lose the tax treatment afforded to ISOs under the Code with respect to any portion of the Stock Option so exercised.
5.Restrictions on Transfer; Disqualifying Dispositions. The Stock Option may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan. If the Participant transfers or otherwise disposes of any Shares acquired upon the exercise of the Stock Option within two years from the Date of Grant or within one year after such Shares were acquired pursuant to

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the exercise of the Stock Option, within fifteen (15) days following such transfer or disposition, the Participant will notify the Company in writing of such transfer or disposition.
6.Forfeiture; Recovery of Compensation.  By accepting, or being deemed to have accepted, the Stock Option, the Participant expressly acknowledges and agrees that his or her rights, and those of any permitted transferee, with respect to the Stock Option, including the right to any Shares acquired under the Stock Option and any amounts received in respect thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision).  The Participant further agrees to be bound by the terms of any applicable clawback or recoupment policy of the Company.  Nothing in the preceding sentence will be construed as limiting the general application of Section 8 of this Agreement.
7.Taxes.  The Participant expressly acknowledges and agrees that the Participant’s rights hereunder, including the right to be issued Shares upon exercise of the Stock Option, are subject to the Participant promptly paying to the Company in cash or by check (or by such other means as may be acceptable to the Administrator) all taxes and other amounts required to be withheld.  No Shares will be issued pursuant to the exercise of the Stock Option unless and until the person exercising the Stock Option has remitted to the Company an amount in cash sufficient to satisfy any withholding requirements, or has made other arrangements satisfactory to the Company with respect to such amounts.  The Participant authorizes the Company and its subsidiaries to withhold any amounts due in respect of any required withholdings from any amounts otherwise owed to the Participant, but nothing in this sentence will be construed as relieving the Participant from any liability for satisfying his or her obligation under the preceding provisions of this Section.
8.Provisions of the Plan.  This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference.  A copy of the Plan as in effect on the Date of Grant has been made available to the Participant.  By accepting, or being deemed to have accepted, the Stock Option, the Participant agrees to be bound by the terms of the Plan and this Agreement.  In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.  
9.Acknowledgements.  The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument; (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder; and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.

[Signature page follows.]

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The Company, by its duly authorized officer, and the Participant have executed this Agreement.

VERASTEM, INC.

By: ______________________________

Name: ___________________________

Title: ______________________________

Agreed and Accepted:

By_______________________________

[Participant’s Name]

Signature Page to Stock Option Agreement


Exhibit 10.3

Name:

[_________]

Number of Shares of Stock subject to the Stock Option:

[_________]

Exercise Price Per Share:

$[_________]

Date of Grant:

[_________]

Vesting Commencement Date:

[_________]

VERASTEM, INC.
2021 Equity Incentive Plan

Non-Statutory Stock Option Agreement

This agreement (this “Agreement”) evidences a stock option granted by Verastem, Inc., a Delaware corporation (the “Company”), to the individual named above (the “Participant”), pursuant to and subject to the terms of the Verastem, Inc. 2021 Equity Incentive Plan (as from time to time amended and in effect, the “Plan”).  Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.

1.Grant of Stock Option.  On the date of grant set forth above (the “Date of Grant”), the Company granted to the Participant an option (the “Stock Option”) to purchase, pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, up to the number of shares of Stock set forth above (the “Shares”), with an exercise price per Share as set forth above, in each case, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof.  

The Stock Option evidenced by this Agreement is a non-statutory option (that is, an option that is not intended to qualify as an incentive stock option) and is granted to the Participant in connection with the Participant’s Employment.

2.Vesting.  The term “vest” as used herein with respect to the Stock Option or any portion thereof means to become exercisable and the term “vested” as used herein with respect to the Stock Option (or any portion thereof) means that the Stock Option (or portion thereof) is then exercisable.  Unless earlier terminated, forfeited, relinquished or expired, the Stock Option will vest as to [  ] (rounded down on each vesting date to the nearest whole Share, with the Stock Option becoming 100% vested on the final vesting date), in each case, subject to the Participant’s continued Employment through the applicable vesting date.  In the event of a Change in Control, the Stock Option, to the extent outstanding and unvested immediately prior to such Change in Control, will become fully vested immediately prior to (and subject to the consummation of) such Change in Control. For purposes of this Agreement, “Change in Control” shall mean (i) the acquisition of beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) directly or indirectly by any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) of securities of the Company representing a majority or more of the combined voting power of the Company’s then outstanding securities, other than an acquisition of securities for investment purposes pursuant to a bona fide financing of the Company; (ii) a merger or consolidation of the Company with any other corporation in which the holders of the voting securities of the Company prior to the merger or consolidation do not own more than fifty (50) percent of the total voting securities of the surviving corporation; or (iii) the sale or disposition by the Company of all or


substantially all of the Company’s assets other than a sale or disposition of assets to an affiliate of the Company or a holder of securities of the Company.
3.Exercise of the Stock Option.  No portion of the Stock Option may be exercised until such portion vests.  Each election to exercise any vested portion of the Stock Option will be subject to the terms and conditions of the Plan and must be in written or electronic form acceptable to the Administrator, signed (including by electronic signature) by the Participant or, if at the relevant time the Stock Option has passed to the estate or beneficiary of the Participant or a permitted transferee, by such estate or beneficiary or permitted transferee.  Each such written or electronic exercise election must be received by the Company at its principal office or at such other place or by such other party as the Administrator may prescribe and must be accompanied by payment in full of the exercise price by cash or check, through a broker-assisted exercise program acceptable to the Administrator, or as otherwise provided in the Plan.  Subject to earlier termination as set forth herein or in the Plan (including Section 6(a)(4) of the Plan), the latest date on which the Stock Option or any portion thereof may be exercised is the tenth (10th) anniversary of the Date of Grant (the “Final Exercise Date”) and, if not exercised on or prior to such date, the Stock Option or any remaining portion thereof will thereupon immediately terminate.
4.Cessation of Employment. If the Participant’s Employment ceases for any reason, except as expressly provided for in a written agreement between the Participant and the Company or one of its affiliates that is in effect at the time of such cessation of Employment, the Stock Option, to the extent not then vested, will be immediately forfeited for no consideration, and any vested portion of the Stock Option that is then outstanding will remain exercisable for the period, if any, described in Section 6(a)(4) of the Plan.  
5.Restrictions on Transfer.  The Stock Option may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan.
6.Forfeiture; Recovery of Compensation.  By accepting, or being deemed to have accepted, the Stock Option, the Participant expressly acknowledges and agrees that his or her rights, and those of any permitted transferee, with respect to the Stock Option, including the right to any Shares acquired under the Stock Option and any amounts received in respect thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision).  The Participant further agrees to be bound by the terms of any applicable clawback or recoupment policy of the Company.  Nothing in the preceding sentence will be construed as limiting the general application of Section 8 of this Agreement.
7.Taxes.  The Participant expressly acknowledges and agrees that the Participant’s rights hereunder, including the right to be issued Shares upon exercise of the Stock Option, are subject to the Participant promptly paying to the Company in cash or by check (or by such other means as may be acceptable to the Administrator) all taxes and other amounts required to be withheld.  No Shares will be issued pursuant to the exercise of the Stock Option unless and until the person exercising the Stock Option has remitted to the Company an amount in cash sufficient to satisfy any withholding requirements, or has made other arrangements satisfactory to the Company with respect to such amounts.  The Participant authorizes the Company and its subsidiaries to withhold any amounts due in respect of any required withholdings from any amounts otherwise owed to the Participant, but nothing in this sentence will be construed as

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relieving the Participant from any liability for satisfying his or her obligation under the preceding provisions of this Section.
8.Provisions of the Plan.  This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference.  A copy of the Plan as in effect on the Date of Grant has been made available to the Participant.  By accepting, or being deemed to have accepted, the Stock Option, the Participant agrees to be bound by the terms of the Plan and this Agreement.  In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.  
9.Acknowledgements.  The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument; (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder; and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.

[Signature page follows.]

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The Company, by its duly authorized officer, and the Participant have executed this Agreement.

VERASTEM, INC.

By: ______________________________

Name: ___________________________

Title: ______________________________

Agreed and Accepted:

By_______________________________

[Participant’s Name]

Signature Page to Stock Option Agreement


Exhibit 10.4

Name:

[_________]

Number of Shares of Stock subject to the Stock Option:

[_________]

Exercise Price Per Share:

$[_________]

Date of Grant:

[_________]

Vesting Commencement Date:

[_________]

VERASTEM, INC.
2021 Equity Incentive Plan

Non-Statutory Stock Option Agreement

(Non-Employee)

This agreement (this “Agreement”) evidences a stock option granted by Verastem, Inc., a Delaware corporation (the “Company”), to the individual named above (the “Participant”), pursuant to and subject to the terms of the Verastem, Inc. 2021 Equity Incentive Plan (as from time to time amended and in effect, the “Plan”).  Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.

1.Grant of Stock Option.  On the date of grant set forth above (the “Date of Grant”), the Company granted to the Participant an option (the “Stock Option”) to purchase, pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, up to the number of shares of Stock set forth above (the “Shares”), with an exercise price per Share as set forth above, in each case, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof.  

The Stock Option evidenced by this Agreement is a non-statutory option (that is, an option that is not intended to qualify as an incentive stock option) and is granted to the Participant in connection with the Participant’s Employment.

2.Vesting.  The term “vest” as used herein with respect to the Stock Option or any portion thereof means to become exercisable and the term “vested” as used herein with respect to the Stock Option (or any portion thereof) means that the Stock Option (or portion thereof) is then exercisable.  Unless earlier terminated, forfeited, relinquished or expired, the Stock Option will vest as to [  ] (rounded down on each vesting date to the nearest whole Share, with the Stock Option becoming 100% vested on the final vesting date), in each case, subject to the Participant’s continued Employment through the applicable vesting date.  In the event of a Change in Control, the Stock Option, to the extent outstanding and unvested immediately prior to such Change in Control, will become fully vested immediately prior to (and subject to the consummation of) such Change in Control. For purposes of this Agreement, “Change in Control” shall mean (i) the acquisition of beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) directly or indirectly by any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) of securities of the Company representing a majority or more of the combined voting power of the Company’s then outstanding securities, other than an acquisition of securities for investment purposes pursuant to a bona fide financing of the Company; (ii) a merger or consolidation of the Company with any other corporation in which the holders of the voting securities of the Company prior to the merger or consolidation do not own more than fifty (50) percent of the total voting


securities of the surviving corporation; or (iii) the sale or disposition by the Company of all or substantially all of the Company’s assets other than a sale or disposition of assets to an affiliate of the Company or a holder of securities of the Company.
3.Exercise of the Stock Option.  No portion of the Stock Option may be exercised until such portion vests.  Each election to exercise any vested portion of the Stock Option will be subject to the terms and conditions of the Plan and must be in written or electronic form acceptable to the Administrator, signed (including by electronic signature) by the Participant or, if at the relevant time the Stock Option has passed to the estate or beneficiary of the Participant or a permitted transferee, by such estate or beneficiary or permitted transferee.  Each such written or electronic exercise election must be received by the Company at its principal office or at such other place or by such other party as the Administrator may prescribe and must be accompanied by payment in full of the exercise price by cash or check, through a broker-assisted exercise program acceptable to the Administrator, or as otherwise provided in the Plan.  Subject to earlier termination as set forth herein or in the Plan (including Section 6(a)(4) of the Plan), the latest date on which the Stock Option or any portion thereof may be exercised is the tenth (10th) anniversary of the Date of Grant (the “Final Exercise Date”) and, if not exercised on or prior to such date, the Stock Option or any remaining portion thereof will thereupon immediately terminate.
4.Cessation of Employment. If the Participant’s Employment ceases for any reason, the Stock Option, to the extent not then vested, will be immediately forfeited for no consideration, and any vested portion of the Stock Option that is then outstanding will remain exercisable for the period, if any, described in Section 6(a)(4) of the Plan.  
5.Restrictions on Transfer.  The Stock Option may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan.
6.Forfeiture; Recovery of Compensation.  By accepting, or being deemed to have accepted, the Stock Option, the Participant expressly acknowledges and agrees that his or her rights, and those of any permitted transferee, with respect to the Stock Option, including the right to any Shares acquired under the Stock Option and any amounts received in respect thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision).  The Participant further agrees to be bound by the terms of any applicable clawback or recoupment policy of the Company.  Nothing in the preceding sentence will be construed as limiting the general application of Section 8 of this Agreement.
7.Taxes.  The Participant is responsible for satisfying and paying all taxes arising from or due in connection with the Stock Option, its exercise and any disposition of any Shares acquired upon exercise of the Stock Option.  The Company will have no liability or obligation related to the foregoing.
8.Provisions of the Plan.  This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference.  A copy of the Plan as in effect on the Date of Grant has been made available to the Participant.  By accepting, or being deemed to have accepted, the Stock Option, the Participant agrees to be bound by the terms of the Plan and this Agreement.  In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.  

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9.Acknowledgements.  The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument; (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder; and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.

[Signature page follows.]

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The Company, by its duly authorized officer, and the Participant have executed this Agreement.

VERASTEM, INC.

By: ______________________________

Name: ___________________________

Title: ______________________________

Agreed and Accepted:

By_______________________________

[Participant’s Name]

Signature Page to Stock Option Agreement


Exhibit 10.5

Name:

[_________]

Number of Restricted Stock Units:

[_________]

Date of Grant:

[_________]

Vesting Commencement Date:

[_________]

VERASTEM, INC.
2021 Equity Incentive Plan

Restricted Stock Unit Agreement

This agreement (this “Agreement”) evidences a grant (the “Award”) of Restricted Stock Units (“RSUs”) by Verastem, Inc., a Delaware corporation (the “Company”), to the individual named above (the “Participant”), pursuant to and subject to the terms of Verastem, Inc. 2021 Equity Incentive Plan (as from time to time amended and in effect, the “Plan”).  Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.

1.Grant of RSUs.  On the date of grant set forth above (the “Date of Grant”), the Company granted to the Participant the number of Restricted Stock Units (“RSUs”) set forth above, giving the Participant the conditional right to receive, without payment and pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, one share of Stock (a “Share”) with respect to each RSU subject to this Award, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof.  

The RSUs are granted to the Participant in connection with the Participant’s Employment.  

2.Vesting.  Unless earlier terminated, forfeited, relinquished or expired, the RSUs will vest as to [  ] (with the number of RSUs that vest on each such date being rounded down to the nearest whole RSU and with the Award becoming vested as to one hundred percent (100%) of the RSUs on the final vesting date), in each case, subject to the Participant’s continued Employment through the applicable vesting date. In the event of a Change in Control, all RSUs outstanding and unvested immediately prior to such Change in Control will become fully vested immediately prior to (and subject to the consummation of) such Change in Control. For purposes of this Agreement, “Change in Control” shall mean (i) the acquisition of beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) directly or indirectly by any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) of securities of the Company representing a majority or more of the combined voting power of the Company’s then outstanding securities, other than an acquisition of securities for investment purposes pursuant to a bona fide financing of the Company; (ii) a merger or consolidation of the Company with any other corporation in which the holders of the voting securities of the Company prior to the merger or consolidation do not own more than fifty (50) percent of the total voting securities of the surviving corporation; or (iii) the sale or disposition by the Company of all or substantially all of the Company’s assets other than a sale or disposition of assets to an affiliate of the Company or a holder of securities of the Company.


3.Cessation of Employment. If the Participant’s Employment ceases for any reason, except as expressly provided in a written employment, change of control or severance-benefit agreement between the Participant and the Company or one of its affiliates that is in effect at the time of such cessation of Employment, the RSUs, to the extent not then vested, will be immediately forfeited for no consideration.  
4.Dividends.  The RSUs shall have no rights with respect to dividends declared by the Company with respect to its capital stock; provided, that, the foregoing shall not prohibit or otherwise limit the adjustment of the terms of this Agreement by the Administrator in accordance with Section 7 of the Plan.
5.Delivery of Shares.  The Company shall, as soon as practicable upon the vesting of any RSUs (but in no event later than thirty (30) days following the date on which such RSUs vest), effect delivery of the Shares with respect to such vested RSUs to the Participant (or, in the event of the RSUs have passed to the estate or beneficiary of the Participant or a permitted transferee, to such estate or beneficiary or permitted transferee).  
6.Restrictions on Transfer.  The RSUs may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan.
7.Forfeiture; Recovery of Compensation.  By accepting, or being deemed to have accepted, the RSUs, the Participant expressly acknowledges and agrees that his or her rights, and those of any permitted transferee, with respect to the RSUs, including the right to any Shares acquired in respect of the RSUs and any amounts received in respect thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision).  The Participant further agrees to be bound by the terms of any applicable clawback or recoupment policy of the Company.  Nothing in the preceding sentence will be construed as limiting the general application of Section 9 of this Agreement.
8.Taxes.  The Participant expressly acknowledges and agrees that the Participant’s rights hereunder, including the right to be issued Shares upon settlement of the Award, are subject to the Participant promptly paying to the Company in cash or by check (or by such other means as may be acceptable to the Administrator) all taxes and other amounts required to be withheld.  No Shares will be issued in respect of the Award unless and until the Participant has remitted to the Company an amount in cash sufficient to satisfy any withholding requirements, or has made other arrangements satisfactory to the Company with respect to such amounts.  Unless otherwise determined by the Company, the Company shall automatically satisfy any tax withholding obligations by withholding from the Shares that would otherwise be delivered in connection with a vesting date a number of Shares having a fair market value equal to the minimum statutory amount required to be withheld to satisfy such tax withholding obligations and/or by causing such number of Shares to be sold in accordance with a sell-to-cover arrangement.  The Participant authorizes the Company and its subsidiaries to withhold any amounts due in respect of any required withholdings by withholding from the Shares otherwise deliverable in connection with the RSUs, by causing such Shares to be sold in accordance with a sell-to-cover arrangement and/or by withholding from any amounts otherwise owed to the Participant.  If a sell-to-cover arrangement is selected as contemplated hereunder the Participant shall bear all costs associated with the sale of Shares under such arrangement.  Nothing in this Section 7, however, shall be construed as

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relieving the Participant of any liability for satisfying his or her tax obligations relating to the Award.
9.Provisions of the Plan.  This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference.  A copy of the Plan as in effect on the Date of Grant has been made available to the Participant.  By accepting, or being deemed to have accepted, the Award, the Participant agrees to be bound by the terms of the Plan and this Agreement.  In the event of any conflict between the terms of this Agreement and the Plan, the terms of the Plan will control.  
10.Acknowledgements.  The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument; (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder; and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.

[Signature page follows.]

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The Company, by its duly authorized officer, and the Participant have executed this Agreement.

VERASTEM, INC.

By:

Name:

Title:

Agreed and Accepted:

By_______________________________

   [Participant’s Name]    

Signature Page to Restricted Stock Unit Agreement


Exhibit 10.6

Name:

[_________]

Number of Shares of Stock subject to the Stock Option:

[_________]

Exercise Price Per Share:

$[_________]

Date of Grant:

[_________]

Vesting Commencement Date:

[_________]

VERASTEM, INC.

Non-Statutory Stock Option Agreement

(Inducement Award)

This agreement (this “Agreement”) evidences an inducement grant of a stock option by Verastem, Inc., a Delaware corporation (the “Company”), to the individual named above (the “Participant”). The stock option is granted to the Participant in connection with the Participant’s entering into employment with the Company and is regarded by the parties as an inducement material to the Participant’s entering into employment within the meaning of NASDAQ Listing Rule 5635(c)(4).

The stock option shall be subject to and governed by, and shall be construed and administered in accordance with, the terms and conditions of the Verastem, Inc. 2021 Equity Incentive Plan (as from time to time amended and in effect, the “Plan”), which terms and conditions are incorporated herein by reference, except for those terms and conditions contained in Section 4(a) of the Plan and any amendments to Section 4(a) of the Plan.  Notwithstanding the foregoing, the stock option is not awarded under the Plan and the grant of the stock option and issuance of any share of Stock pursuant to exercise of the stock option shall not reduce the number of shares of Stock available for issuance under awards pursuant to the Plan.  Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.

1.Grant of Stock Option.  On the date of grant set forth above (the “Date of Grant”), the Company granted to the Participant an option (the “Stock Option”) to purchase, pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, up to the number of shares of Stock set forth above (the “Shares”), with an exercise price per Share as set forth above, in each case, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof.  

The Stock Option evidenced by this Agreement is a non-statutory option (that is, an option that is not intended to qualify as an incentive stock option) and is granted to the Participant in connection with the Participant’s Employment.

2.Vesting.  The term “vest” as used herein with respect to the Stock Option or any portion thereof means to become exercisable and the term “vested” as used herein with respect to the Stock Option (or any portion thereof) means that the Stock Option (or portion thereof) is then exercisable.  Unless earlier terminated, forfeited, relinquished or expired, the Stock Option will vest as to [  ] (rounded down on each vesting date to the nearest whole Share, with the Stock Option becoming 100% vested on the final vesting date), in each case, subject to the Participant’s continued Employment through the applicable vesting date.  In the event of a


Change in Control, the Stock Option, to the extent outstanding and unvested immediately prior to such Change in Control, will become fully vested immediately prior to (and subject to the consummation of) such Change in Control. For purposes of this Agreement, “Change in Control” shall mean (i) the acquisition of beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) directly or indirectly by any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) of securities of the Company representing a majority or more of the combined voting power of the Company’s then outstanding securities, other than an acquisition of securities for investment purposes pursuant to a bona fide financing of the Company; (ii) a merger or consolidation of the Company with any other corporation in which the holders of the voting securities of the Company prior to the merger or consolidation do not own more than fifty (50) percent of the total voting securities of the surviving corporation; or (iii) the sale or disposition by the Company of all or substantially all of the Company’s assets other than a sale or disposition of assets to an affiliate of the Company or a holder of securities of the Company.
3.Exercise of the Stock Option.  No portion of the Stock Option may be exercised until such portion vests.  Each election to exercise any vested portion of the Stock Option will be subject to the terms and conditions of the Plan and must be in written or electronic form acceptable to the Administrator, signed (including by electronic signature) by the Participant or, if at the relevant time the Stock Option has passed to the estate or beneficiary of the Participant or a permitted transferee, by such estate or beneficiary or permitted transferee.  Each such written or electronic exercise election must be received by the Company at its principal office or at such other place or by such other party as the Administrator may prescribe and must be accompanied by payment in full of the exercise price by cash or check, through a broker-assisted exercise program acceptable to the Administrator, or as otherwise provided in the Plan.  Subject to earlier termination as set forth herein or in the Plan (including Section 6(a)(4) of the Plan), the latest date on which the Stock Option or any portion thereof may be exercised is the tenth (10th) anniversary of the Date of Grant (the “Final Exercise Date”) and, if not exercised on or prior to such date, the Stock Option or any remaining portion thereof will thereupon immediately terminate.
4.Cessation of Employment. If the Participant’s Employment ceases for any reason, except as expressly provided for in a written agreement between the Participant and the Company or one of its affiliates that is in effect at the time of such cessation of Employment, the Stock Option, to the extent not then vested, will be immediately forfeited for no consideration, and any vested portion of the Stock Option that is then outstanding will remain exercisable for the period, if any, described in Section 6(a)(4) of the Plan.  
5.Restrictions on Transfer. The Stock Option may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan.
6.Forfeiture; Recovery of Compensation.  By accepting, or being deemed to have accepted, the Stock Option, the Participant expressly acknowledges and agrees that his or her rights, and those of any permitted transferee, with respect to the Stock Option, including the right to any Shares acquired under the Stock Option and any amounts received in respect thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision).  The Participant further agrees to be bound by the terms of any applicable clawback or recoupment policy of the

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Company.  Nothing in the preceding sentence will be construed as limiting the general application of Section 8 of this Agreement.
7.Taxes.  The Participant expressly acknowledges and agrees that the Participant’s rights hereunder, including the right to be issued Shares upon exercise of the Stock Option, are subject to the Participant promptly paying to the Company in cash or by check (or by such other means as may be acceptable to the Administrator) all taxes and other amounts required to be withheld.  No Shares will be issued pursuant to the exercise of the Stock Option unless and until the person exercising the Stock Option has remitted to the Company an amount in cash sufficient to satisfy any withholding requirements, or has made other arrangements satisfactory to the Company with respect to such amounts.  The Participant authorizes the Company and its subsidiaries to withhold any amounts due in respect of any required withholdings from any amounts otherwise owed to the Participant, but nothing in this sentence will be construed as relieving the Participant from any liability for satisfying his or her obligation under the preceding provisions of this Section.
8.Provisions of the Plan.  By accepting all or any part of the Stock Option, the Participant agrees to be bound by the terms and conditions set forth in this Agreement and incorporated herein by reference to the Plan.  A copy of the Plan as in effect on the Date of Grant has been made available to the Participant.  In the event of any conflict between the terms of this Agreement and the provisions of the Plan incorporated herein by reference, such provisions of the Plan will control.  
9.Acknowledgements.  The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument; (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder; and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.

[Signature page follows.]

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The Company, by its duly authorized officer, and the Participant have executed this Agreement.

VERASTEM, INC.

By: ______________________________

Name: ___________________________

Title: ______________________________

Agreed and Accepted:

By_______________________________

[Participant’s Name]

Signature Page to Stock Option Agreement


Exhibit 10.7

Name:

[_________]

Number of Restricted Stock Units:

[_________]

Date of Grant:

[_________]

Vesting Commencement Date:

[_________]

VERASTEM, INC.

Restricted Stock Unit Agreement

(Inducement Award)

This agreement (this “Agreement”) evidences an inducement award (the “Award”) of Restricted Stock Units (“RSUs”) by Verastem, Inc., a Delaware corporation (the “Company”), to the individual named above (the “Participant”).  The RSUs are granted to the Participant in connection with the Participant’s entering into employment with the Company and is regarded by the parties as an inducement material to the Participant’s entering into employment within the meaning of NASDAQ Listing Rule 5635(c)(4).

The RSUs shall be subject to and governed by, and shall be construed and administered in accordance with, the terms and conditions of the Verastem, Inc. 2021 Equity Incentive Plan (as from time to time amended and in effect, the “Plan”), which terms and conditions are incorporated herein by reference, except for those terms and conditions contained in Section 4(a) of the Plan and any amendments to Section 4(a) of the Plan.  Notwithstanding the foregoing, the RSUs are not awarded under the Plan and the grant of the RSUs and issuance of any Shares pursuant to the settlement of the RSUs shall not reduce the number of shares of Stock available for issuance under awards pursuant to the Plan.  Except as otherwise defined herein, all capitalized terms used herein have the same meaning as in the Plan.

1.Grant of RSUs.  On the date of grant set forth above (the “Date of Grant”), the Company granted to the Participant the number of Restricted Stock Units (“RSUs”) set forth above, giving the Participant the conditional right to receive, without payment and pursuant to and subject to the terms and conditions set forth in this Agreement and in the Plan, one share of Stock (a “Share”) with respect to each RSU subject to this Award, subject to adjustment pursuant to Section 7 of the Plan in respect of transactions occurring after the date hereof.  

The RSUs are granted to the Participant in connection with the Participant’s Employment.  

2.Vesting.  Unless earlier terminated, forfeited, relinquished or expired, the RSUs will vest as to [  ] (with the number of RSUs that vest on each such date being rounded down to the nearest whole RSU and with the Award becoming vested as to one hundred percent (100%) of the RSUs on the final vesting date), in each case, subject to the Participant’s continued Employment through the applicable vesting date. In the event of a Change in Control, all RSUs outstanding and unvested immediately prior to such Change in Control will become fully vested immediately prior to (and subject to the consummation of) such Change in Control. For purposes of this Agreement, “Change in Control” shall mean (i) the acquisition of beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) directly or indirectly by any “person” (as such


term is used in Sections 13(d) and 14(d) of the Exchange Act) of securities of the Company representing a majority or more of the combined voting power of the Company’s then outstanding securities, other than an acquisition of securities for investment purposes pursuant to a bona fide financing of the Company; (ii) a merger or consolidation of the Company with any other corporation in which the holders of the voting securities of the Company prior to the merger or consolidation do not own more than fifty (50) percent of the total voting securities of the surviving corporation; or (iii) the sale or disposition by the Company of all or substantially all of the Company’s assets other than a sale or disposition of assets to an affiliate of the Company or a holder of securities of the Company.
3.Cessation of Employment. If the Participant’s Employment ceases for any reason, except as expressly provided in a written employment, change of control or severance-benefit agreement between the Participant and the Company or one of its affiliates that is in effect at the time of such cessation of Employment, the RSUs, to the extent not then vested, will be immediately forfeited for no consideration.  
4.Dividends.  The RSUs shall have no rights with respect to dividends declared by the Company with respect to its capital stock; provided, that, the foregoing shall not prohibit or otherwise limit the adjustment of the terms of this Agreement by the Administrator in accordance with Section 7 of the Plan.
5.Delivery of Shares.  The Company shall, as soon as practicable upon the vesting of any RSUs (but in no event later than thirty (30) days following the date on which such RSUs vest), effect delivery of the Shares with respect to such vested RSUs to the Participant (or, in the event of the RSUs have passed to the estate or beneficiary of the Participant or a permitted transferee, to such estate or beneficiary or permitted transferee).  
6.Restrictions on Transfer.  The RSUs may not be transferred except as expressly permitted under Section 6(a)(3) of the Plan.
7.Forfeiture; Recovery of Compensation.  By accepting, or being deemed to have accepted, the RSUs, the Participant expressly acknowledges and agrees that his or her rights, and those of any permitted transferee, with respect to the RSUs, including the right to any Shares acquired in respect of the RSUs and any amounts received in respect thereof, are subject to Section 6(a)(5) of the Plan (including any successor provision).  The Participant further agrees to be bound by the terms of any applicable clawback or recoupment policy of the Company.  Nothing in the preceding sentence will be construed as limiting the general application of Section 9 of this Agreement.
8.Taxes.  The Participant expressly acknowledges and agrees that the Participant’s rights hereunder, including the right to be issued Shares upon settlement of the Award, are subject to the Participant promptly paying to the Company in cash or by check (or by such other means as may be acceptable to the Administrator) all taxes and other amounts required to be withheld.  No Shares will be issued in respect of the Award unless and until the Participant has remitted to the Company an amount in cash sufficient to satisfy any withholding requirements, or has made other arrangements satisfactory to the Company with respect to such amounts.  Unless otherwise determined by the Company, the Company shall automatically satisfy any tax withholding

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obligations by withholding from the Shares that would otherwise be delivered in connection with a vesting date a number of Shares having a fair market value equal to the minimum statutory amount required to be withheld to satisfy such tax withholding obligations and/or by causing such number of Shares to be sold in accordance with a sell-to-cover arrangement.  The Participant authorizes the Company and its subsidiaries to withhold any amounts due in respect of any required withholdings by withholding from the Shares otherwise deliverable in connection with the RSUs, by causing such Shares to be sold in accordance with a sell-to-cover arrangement and/or by withholding from any amounts otherwise owed to the Participant.  If a sell-to-cover arrangement is selected as contemplated hereunder the Participant shall bear all costs associated with the sale of Shares under such arrangement.  Nothing in this Section 8, however, shall be construed as relieving the Participant of any liability for satisfying his or her tax obligations relating to the Award.
9.Provisions of the Plan.  By accepting all or any part of the RSUs, the Participant agrees to be bound by the terms and conditions set forth in this Agreement and incorporated herein by reference to the Plan.  A copy of the Plan as in effect on the Date of Grant has been made available to the Participant.  In the event of any conflict between the terms of this Agreement and the provisions of the Plan incorporated herein by reference, such provisions of the Plan will control.  
10.Acknowledgements.  The Participant acknowledges and agrees that (i) this Agreement may be executed in two or more counterparts, each of which will be an original and all of which together will constitute one and the same instrument; (ii) this Agreement may be executed and exchanged using facsimile, portable document format (PDF) or electronic signature, which, in each case, will constitute an original signature for all purposes hereunder; and (iii) such signature by the Company will be binding against the Company and will create a legally binding agreement when this Agreement is countersigned by the Participant.

[Signature page follows.]

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The Company, by its duly authorized officer, and the Participant have executed this Agreement.

VERASTEM, INC.

By:

Name:

Title:

Agreed and Accepted:

By_______________________________

   [Participant’s Name]    

Signature Page to Restricted Stock Unit Agreement


Exhibit 31.1

CERTIFICATIONS

I, Brian M. Stuglik, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Verastem, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ BRIAN M. STUGLIK

Brian M. Stuglik

Chief Executive Officer

(Principal executive officer)

Date: August 2, 2021

1


Exhibit 31.2

CERTIFICATIONS

I, Robert Gagnon, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Verastem, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

OO

/s/ ROBERT GAGNON

Robert Gagnon

Chief Business and Financial Officer

(Principal financial and accounting officer)

Date: August 2, 2021

1


Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Verastem, Inc. (the “Company”) for the period ended June 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Brian M. Stuglik, Chief Executive Officer of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

(1)the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ BRIAN M. STUGLIK

Brian M. Stuglik

Chief Executive Officer

(Principal executive officer)

Date: August 2, 2021

1


Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Verastem, Inc. (the “Company”) for the period ended June 30, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Robert Gagnon, Chief Business and Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

(1)the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ ROBERT GAGNON

Robert Gagnon

Chief Business and Financial Officer

(Principal financial and accounting officer)

Date: August 2, 2021

1


Verastem Oncology and Yakult Honsha Co., Ltd. Sign Exclusive License  Agreement for the Development and Commercialization of Duvelisib in Japan |  Business Wire

Verastem Oncology Reports Second Quarter 2021 Financial Results and Highlights Recent Company Progress

Received Breakthrough Therapy Designation for VS-6766 in Combination with Defactinib for the Treatment of Recurrent Low-Grade Serous Ovarian Cancer Following One or More Prior Lines of Therapy

Eliminated Substantially All Outstanding Debt; Expected Cash Runway Until at Least 2024

Updated Results from Investigator-Sponsored Phase 1/2 FRAME Study of VS-6766 and Defactinib in Low Grade Serous Ovarian Cancer Selected for Mini Oral Presentation at ESMO 2021

BOSTON, MA – August 2, 2021 – Verastem Oncology (Nasdaq: VSTM), a biopharmaceutical company committed to advancing new medicines for patients battling cancer, today reported financial results for the three months ended June 30, 2021 and highlighted recent progress.

“There were several achievements of note during the second quarter, specifically the receipt of Breakthrough Therapy designation for VS-6766 in combination with defactinib for the treatment of recurrent low-grade serous ovarian cancer. Updated data from the investigator-initiated FRAME study, which was the basis for Breakthrough Therapy designation, has been accepted for presentation at the upcoming European Society of Medical Oncology (ESMO) Congress 2021,” said Brian Stuglik, CEO of Verastem Oncology. “Further, subsequent to the end of the second quarter, we eliminated substantially all of our outstanding debt through conversion of $28 million of our convertible senior notes, saving the Company over $30 million and enabling a cash runway that is expected to last until at least 2024.”

Recent Corporate Highlights

Low-Grade Serous Ovarian Cancer (LGSOC)

Updated results from the investigator-sponsored Phase 1/2 FRAME study in LGSOC were selected for a mini oral presentation at ESMO 2021. The presentation will take place on Sunday, September 19, 2021 at 17:50 CEST.
Received Breakthrough Therapy designation for VS-6766 in combination with defactinib for the treatment of recurrent LGSOC, regardless of KRAS status, following one or more prior lines of therapy, including platinum-based chemotherapy.
Continued progress with the company-sponsored, registration-directed Phase 2 study (RAMP 201) investigating VS-6766 alone and in combination with defactinib for the treatment of recurrent LGSOC. The Company expects to report top-line results from the selection phase of RAMP 201 and commence expansion phase during the first half of 2022.

KRAS Mutant Non-small Cell Lung Cancer (NSCLC)

Continued progress in company-sponsored, registration-directed Phase 2 study (RAMP 202) investigating VS-6766 alone and in combination with defactinib for the treatment of patients with


KRAS G12V mutant NSCLC. The Company expects to report top-line results from the selection phase of RAMP 202 and commence expansion phase during first half of 2022.

Corporate and Financial

Converted all of the $28.0 million aggregate principal of the Company’s 2020 5.00% Convertible Senior Notes due 2048 in exchange for approximately 8.6 million shares of common stock. The conversion eliminates substantially all outstanding debt and preserves approximately $31.2 million in cash. Cash runway expected until at least 2024 to deliver on current programs.

During the second quarter 2021, Verastem Oncology appointed Paul Bunn, M.D., and Lesley Solomon to its Board of Directors.

Second Quarter 2021 Financial Results

Verastem Oncology ended the second quarter 2021 with cash, cash equivalents and investments of $114.1 million.

Total revenue for the three months ended June 30, 2021 (2021 Quarter) was $0.5 million, compared to $4.3 million for the three months ended June 30, 2020 (2020 Quarter).

Total operating expenses for the 2021 Quarter were $16.4 million, compared to $25.6 million for the 2020 Quarter.

Selling, general and administrative expenses for the 2021 Quarter were $6.7 million, compared to $15.4 million for the 2020 Quarter. The decrease of $8.7 million, or 56%, primarily resulted from the Company’s shift in strategic direction and the COPIKTRA sale to Secura Bio, Inc., which led to lower employee related expenses and consulting and professional fees.

Research and development expenses for the 2021 Quarter were $9.7 million, compared to $9.3 million for the 2020 Quarter. The increase of $0.4 million, or 4%, was primarily related to increased personnel related costs, including non-cash stock-based compensation, partially offset by a decrease in contract research organization costs.

Net loss for the 2021 Quarter was $16.9 million, or $0.10 per share (basic and diluted), compared to $23.0 million, or $0.14 per share (basic and diluted), for the 2020 Quarter.

For the 2021 Quarter, non-GAAP adjusted net loss was $14.0 million, or $0.08 per share (diluted), compared to non-GAAP adjusted net loss of $20.5 million, or $0.12 per share (diluted), for the 2020 Quarter. Please refer to the GAAP to Non-GAAP Reconciliation attached to this press release.

Financial Guidance and Outlook

With the proceeds and expected milestones and royalties from the sale of COPIKTRA, Verastem Oncology expects that it will have a cash runway until at least 2024 to deliver on the current programs for VS-6766 and defactinib, including expenditures and development in LGSOC and KRAS mutant NSCLC. Verastem Oncology expects its 2021 annual operating expenses to be approximately $55-60 million.


Use of Non-GAAP Financial Measures

To supplement Verastem Oncology’s condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (GAAP), the Company uses the following non-GAAP financial measures in this press release: non-GAAP adjusted net loss and non-GAAP net loss per share. These non-GAAP financial measures exclude certain amounts or expenses from the corresponding financial measures determined in accordance with GAAP. Management believes this non-GAAP information is useful for investors, taken in conjunction with the Company’s GAAP financial statements, because it provides greater transparency and period-over-period comparability with respect to the Company’s operating performance and can enhance investors’ ability to identify operating trends in the Company’s business. Management uses these measures, among other factors, to assess and analyze operational results and trends and to make financial and operational decisions. Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used to supplement an understanding of the Company’s operating results as reported under GAAP, not in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. In addition, these non-GAAP financial measures are unlikely to be comparable with non-GAAP information provided by other companies. The determination of the amounts that are excluded from non-GAAP financial measures is a matter of management judgment and depends upon, among other factors, the nature of the underlying expense or income amounts. Reconciliations between these non-GAAP financial measures and the most comparable GAAP financial measures for the three and six months ended June 30, 2021 and 2020 are included in the tables accompanying this press release after the unaudited condensed consolidated financial statements.

About the VS-6766/Defactinib Combination

The combination of VS-6766 and defactinib has been found to be clinically active in patients with KRAS mutant tumors. In an ongoing investigator-initiated Phase 1/2 FRAME study, the combination of VS-6766 and defactinib is being evaluated in patients with LGSOC, KRAS mutant NSCLC and colorectal cancer (CRC). The FRAME study was expanded to include new cohorts in pancreatic cancer, KRAS mutant endometrioid cancer and KRAS-G12V NSCLC. Verastem Oncology is also supporting an investigator-initiated Phase 2 trial evaluating VS-6766 with defactinib in patients with metastatic uveal melanoma. Verastem Oncology has initiated Phase 2 registration-directed trials of VS-6766 with defactinib in patients with recurrent LGSOC and in patients with recurrent KRAS-G12V mutant NSCLC as part of its RAMP (Raf And Mek Program).

The U.S. Food and Drug Administration (FDA) granted Breakthrough Therapy designation for the combination of Verastem Oncology’s investigational RAF/MEK inhibitor VS-6766, with defactinib, its FAK inhibitor, for the treatment of all patients with recurrent low-grade serous ovarian cancer (LGSOC) regardless of KRAS status after one or more prior lines of therapy, including platinum-based chemotherapy.

About Verastem Oncology

Verastem Oncology (Nasdaq: VSTM) (Verastem, Inc.) is a development-stage biopharmaceutical company committed to the development and commercialization of new medicines to improve the lives of patients diagnosed with cancer. Our pipeline is focused on novel small molecule drugs that inhibit critical signaling pathways in cancer that promote cancer cell survival and tumor growth, including RAF/MEK inhibition and focal adhesion kinase (FAK) inhibition. For more information, please visit www.verastem.com.


Forward-Looking Statements Notice

This press release includes forward-looking statements about Verastem Oncology’s strategy, future plans and prospects, including statements related to the potential clinical value of the RAF/MEK/FAK combination, the potential benefits of Breakthrough Therapy designation and the timing of commencing and completing registration-directed trials for the RAF/MEK/FAK combination. The words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue," “can,” “promising” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Each forward-looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statement.

Applicable risks and uncertainties include the risks and uncertainties, among other things, regarding: the success in the development and potential commercialization of our product candidates, including defactinib in combination with VS-6766; the occurrence of adverse safety events and/or unexpected concerns that may arise from additional data or analysis or result in unmanageable safety profiles as compared to their levels of efficacy; our ability to obtain, maintain and enforce patent and other intellectual property protection for our product candidates; the scope, timing, and outcome of any legal proceedings; decisions by regulatory authorities regarding labeling and other matters that could affect the availability or commercial potential of our product candidates; whether preclinical testing of our product candidates and preliminary or interim data from clinical trials will be predictive of the results or success of ongoing or later clinical trials; that the timing, scope and rate of reimbursement for our product candidates is uncertain; that third-party payors (including government agencies) may not reimburse; that there may be competitive developments affecting our product candidates; that data may not be available when expected; that enrollment of clinical trials may take longer than expected; that our product candidates will experience manufacturing or supply interruptions or failures; that we will be unable to successfully initiate or complete the clinical development and eventual commercialization of our product candidates; that the development and commercialization of our product candidates will take longer or cost more than planned; that we or Chugai Pharmaceutical Co., Ltd. will fail to fully perform under the VS-6766 license agreement; that we may not have sufficient cash to fund our contemplated operations; that we may be unable to obtain adequate financing in the future through product licensing, co-promotional arrangements, public or private equity, debt financing or otherwise; that we will be unable to execute on our partnering strategies for defactinib in combination with VS-6766; that we will not pursue or submit regulatory filings for our product candidates; that we do not receive additional proceeds from the contingent payments negotiated in the sale of COPIKTRA; that we may pursue collaborations or in-license opportunities that will require additional cash resources; and that our product candidates will not receive regulatory approval, become commercially successful products, or result in new treatment options being offered to patients.

Other risks and uncertainties include those identified under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 as filed with the Securities and Exchange Commission (SEC) on March 18, 2021 and in any subsequent filings with the SEC. The forward-looking statements contained in this press release reflect Verastem Oncology’s views as of the date hereof, and the Company does not assume and specifically disclaims any obligation to update any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law.


Investors:
Ajay Munshi
Vice President, Corporate Development
+1 781-469-1579
[email protected]

Sherri Spear
Argot Partners
+1 212-600-1902
[email protected]

Media:
Lisa Buffington
Corporate Communications
+1 781-292-4205
[email protected]


Verastem Oncology

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

    

June 30,

    

December 31,

 

2021

2020

 

Cash, cash equivalents, & investments

$

114,127

$

147,221

Accounts receivable, net

 

476

 

239

Prepaid expenses and other current assets

 

6,149

 

3,473

Property and equipment, net

 

270

 

416

Right-of-use asset, net

2,524

2,726

Restricted cash and other assets

 

344

 

274

Total assets

$

123,890

$

154,349

Current Liabilities

$

12,744

$

17,093

Convertible senior notes

20,326

19,051

Lease Liability, long-term

2,615

2,931

Stockholders’ equity

 

88,205

 

115,274

Total liabilities and stockholders’ equity

$

123,890

$

154,349


Verastem Oncology

Condensed Consolidated Statements of Operations

(in thousands, except per share amounts)

(unaudited)

Three months ended June 30,

Six months ended June 30,

2021

2020

  

2021

    

2020

 

Revenue:

Product revenue, net

$

$

4,235

$

$

9,269

License and collaboration revenue

72

94

Sale of COPIKTRA license and related assets revenue

52

902

Transition services revenue

448

604

Total revenue

 

500

 

4,307

 

1,506

 

9,363

Operating expenses:

Cost of sales - product

392

887

Cost of sales - intangible amortization

393

785

Research and development

9,730

9,344

18,626

20,268

Selling, general and administrative

 

6,714

 

15,442

 

12,932

 

35,046

Total operating expenses

 

16,444

 

25,571

 

31,558

 

56,986

Loss from operations

 

(15,944)

 

(21,264)

 

(30,052)

 

(47,623)

Other expense

(1,313)

Interest income

 

49

 

122

 

101

 

478

Interest expense

 

(1,007)

 

(1,868)

 

(1,982)

 

(12,542)

Net loss

$

(16,902)

(23,010)

$

(31,933)

$

(61,000)

Net loss per share—basic and diluted

$

(0.10)

$

(0.14)

$

(0.19)

$

(0.45)

Weighted average common shares outstanding used in computing:

 

 

 

Net loss per share – basic and diluted

171,985

165,395

171,811

136,775


Verastem Oncology

Reconciliation of GAAP to Non-GAAP Financial Information

(in thousands, except per share amounts)

(unaudited)

Three months ended June 30,

Six months ended June 30,

2021

2020

  

2021

    

2020

 

Net loss Reconciliation

Net loss (GAAP basis)

$

(16,902)

$

(23,010)

$

(31,933)

$

(61,000)

Adjust:

 

 

 

Amortization of acquired intangible asset

393

785

Stock-based compensation expense

2,170

1,659

4,150

3,029

Non-cash interest, net

 

692

 

480

 

1,328

 

9,259

Severance and other

11

1,798

Change in fair value of derivative

1,313

Chugai license payment

3,000

Adjusted net loss (non-GAAP basis)

$

(14,040)

$

(20,467)

$

(26,455)

$

(41,816)

 

 

 

 

Reconciliation of net loss per Share

 

 

 

 

Net loss per share – diluted (GAAP Basis)

 $

(0.10)

(0.14)

 $

(0.19)

$

(0.45)

Adjust per diluted share:

 

 

 

Amortization of acquired intangible asset

 

 

 

 

0.01

Stock-based compensation expense

 

0.01

 

0.01

 

0.03

 

0.02

Non-cash interest, net

0.01

0.01

0.01

0.07

Severance and other

0.01

Change in fair value of derivative

0.01

Chugai license payment

0.02

Adjusted net loss per share – diluted

(non-GAAP Basis)

$

(0.08)

$

(0.12)

$

(0.15)

$

(0.31)

Weighted average common shares outstanding used in computing net loss per share—diluted

171,985

165,395

171,811

136,775




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