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 Tern PLC (TERN) 
Tern PLC: Issue of further convertible loan to Device Authority Limited 
 
14-Jan-2019 / 07:00 GMT/BST 
Dissemination of a Regulatory Announcement, transmitted by EQS Group. 
The issuer is solely responsible for the content of this announcement. 
 
14 January 2019 
 
        Tern Plc (the "Company", or the "Group") 
 
       Issue of further convertible loan to Device Authority Limited 
 
Tern Plc (AIM: TERN), the investment company specialising in the Internet of 
       Things ("IoT"), announces that it has committed a further convertible 
 secured loan of up to US$400,000 to its portfolio company, Device Authority 
   Limited ("DA"). The total funds secured by DA through this loan from DA's 
                existing shareholders, including Tern, are US$531,930. 
 
  Tern's commitment will be provided in two tranches: 60% of the total loan, 
   which will see Tern contribute US$240,000, is payable immediately, taking 
      Tern's total convertible loan note position in DA to US$1,940,867. The 
    remaining 40% will be payable by 20 February 2019, if certain commercial 
      milestones are met by DA. Following this second tranche of investment, 
         Tern's total convertible secured loan note position with DA will be 
   US$2,100,867. The loan is repayable on 30 June 2019, to coincide with the 
                other outstanding loan notes to DA. 
 
   In providing this support, DA's shareholders, including Tern, are pleased 
with the progress that DA continues to make with its partners, including the 
      recent contract secured with a leading medical device manufacturer (as 
                announced on 27 December 2018). 
 
    The loan note accrues an interest coupon of 5 per cent. per annum and is 
convertible automatically on completion of an equity fundraising in DA of at 
    least US$2.5 million which is completed before 30 June 2019 ("Qualifying 
  Fundraising"). The conversion will be into the most senior class of shares 
    issued in the Qualifying Fundraising at the lowest fundraising price per 
                share. 
 
 If a Qualifying Fundraising is not completed before 30 June 2019, but DA is 
 able to procure an exit for its shareholders, the providers of the loan can 
 elect to either receive 300% of the principal amount of the loan notes held 
     by them in addition to the accrued interest, or to convert the loan and 
 accrued interest into Class A Preference Shares of DA at a conversion price 
                 of GBP0.036681585 per share. 
 
 Providers of this loan to DA will also be issued with 2.6 warrants for each 
US$1 of loan notes subscribed for by them (rounded down to the nearest whole 
   number). Each warrant, which is exercisable at any time before 11 January 
2026, provides each warrant holder with the right to subscribe for one Class 
      A Preference Share of DA for each warrant held at an exercise price of 
                 GBP0.036681585 per share. 
 
 As at 31 December 2018, Tern had an unaudited cash balance of approximately 
                 GBP1.9 million. 
 
Al Sisto, CEO of Tern, said: "We are pleased to continue supporting DA given 
 the progress the company has been making with its current and new partners, 
        including the recent contract win announced in December 2018. We are 
     confident in DA's ongoing progress and look forward to reporting on its 
                future achievements within the IoT security space." 
 
 This announcement contains inside information for the purposes of Article 7 
                of EU Regulation 596/2014 
 
Enquiries 
 
Tern Plc                          via Newgate Communications 
 
Al Sisto/Sarah Payne 
 
                  Allenby Capital         Tel: 020 3328 5656 
 
         (Nomad and joint broker) 
 
     David Worlidge/Alex Brearley 
 
                   Whitman Howard         Tel: 020 7659 1234 
 
                   (Joint broker) 
 
Nick Lovering/Christopher Furness 
 
           Newgate Communications         Tel: 020 3757 6880 
 
    Elisabeth Cowell/Fiona Norman 
 
ISIN:          GB00BFPMV798 
Category Code: MSCH 
TIDM:          TERN 
LEI Code:      2138005F87SODHL9CQ36 
Sequence No.:  7151 
EQS News ID:   765543 
 
End of Announcement EQS News Service

(END) Dow Jones Newswires

January 14, 2019 02:01 ET (07:01 GMT)

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