TERN PLC

Share Issue/Capital Change • Oct 30, 2019

Tern PLC (TERN)

30-Oct-2019 / 07:03 GMT/BST Dissemination of a RegulatoryAnnouncement that contains inside information according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATIONS (EU) NO. 596/2014 ("MAR"). IN ADDITION, MARKET SOUNDINGS WERE TAKEN IN RESPECT OF THE MATTERS CONTAINED IN THIS ANNOUNCEMENT, WITH THE RESULT THAT CERTAIN PERSONS BECAME AWARE OF SUCH INSIDE INFORMATION. UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN AND SUCH PERSONS SHALL THEREFORE CEASE TO BE IN POSSESSION OF INSIDE INFORMATION.

30 October 2019

Tern Plc("Tern" or the "Company") EquityFundraise of c. £1.75m

Tern Plc (AIM:TERN), the investment company specialising in the Internet of Things ("IoT"),announces that it has raised approximately £1.75 million before expenses through a subscrip.on of 15,695,100 new ordinary shares of 0.02p each (the "Subscrip.on Shares") at a price of 11.15 pence per new ordinary share (the "Subscrip.on"), condi.onal upon admission to AIM.

The funds raised will provide Tern with addi.onal finance to con.nue implemen.ng its strategy to acquire and maintain long-term, influen.al interests in high growth IoTinnovatorsand will also provide workingcapital.

Al Sisto, CEO of Tern, commented on the Subscrip8on:

"We are pleased to secure this new capital against a challenging equity capital markets backdrop. This, together with the announcement earlier today regarding FundamentalVR having secured addi onal funds which demonstrates a significant increase in the fair value of our holding, endorses our strategy to capitalise on therapid growth of theIoT by inves ng in UK businesses which havethe poten al to changethefuture and become market leaders.

"This fundraise will enable us to fund further new investments and con nue to support our current por&olio, via our investment thesis to provide hands-on support and to createcollabora veenvironments for talented well-mo vated management teams. It will also enable us to maintain our posi ons of influence in our investee companies when there is follow-on funding with syndicates of investors. We have six companies in our por&olio at various stages of our value crea on model and this new capital will help us meet our goal of providing our shareholders with con nued NAV growth and an investment balance in our por&olio to mi gate risk. We look forward to further announcements regarding our por&olio companies'con nued progress."

Applica.on will be made for the 15,695,100 Subscrip.on Shares to be admi7ed to AIM("Admission") and it is expected that Admission will take place and tradingin the Subscrip.on Shares will commence on 5 November 2019.

In accordance with the Financial Conduct Authority's Disclosure, Guidance and Transparency Rules, the Company confirms that on comple.on of the Subscrip.on and following Admission, the Company's enlarged issued ordinary share capital will comprise 270,019,045 ordinary shares of 0.02p each.The Company does not hold any shares in Treasury. Therefore, from Admission, the total number of vo.ngrights in the Company will be 270,019,045. Following the comple.on of the Subscrip.on and Admission, the above figure may be used by shareholders in the Companyas the denominator for the calcula.ons to determine if they are required to no.fy their interest in, or a change to their interest in the Company, under the Disclosure Guidance and Transparency Rules.

Informa on for Distributors

Solely for the purposes of the product governance requirements contained within: (a) EU Direc ve 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Ar cles 9 and 10 of Commission Delegated Direc ve (EU) 2017/593 supplemen ng MiFID II; and (c) local implemen ng measures (together, the "Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the Product Governance Requirements) may otherwise have with respect thereto, the Subscrip on Shares have been subject to a product approval process by Allenby Capital Limited, which has determined that the Subscrip on Shares are: (i) compa ble with an end target market of retail investors and investors who meet thecriteria of professional clients and eligible counterpar es, each as defined in MiFID II; and (ii) eligible for distribu on through all distribu on channels as are permiDed by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, investors should note that: the price of the Subscrip on Shares may decline and investors could lose all or part of their investment; Subscrip on Shares offer no guaranteed income and no capital protec on; and an investment in Subscrip on Shares is compa ble only with investors who do not need a guaranteed income or capital protec on,

who (either alone or in conjunc on with an appropriate financial or other adviser) are capable of evalua ng the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restric ons in rela on to the Subscrip on. Furthermore, it is noted that, notwithstanding the Target Market Assessment, only investors who have met the criteria of professional clients and eligible counterpar es have been procured. For the avoidance of doubt, the Target Market Assessment does not cons tute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommenda on to any investor or group of investors to invest in, or purchase, or take any other ac on whatsoever with respect to Subscrip on Shares.

Enquiries

Via Newgate Communica.ons

Tern plc Al Sisto, CEO Sarah Payne,Finance Director

Tel: 0203 328 5656

Allenby Capital Limited (Nomad and Joint broker) David Worlidge/Alex Brearley

Tel: 020 7659 1234

Whitman Howard (Joint broker) Nick Lovering/ChristopherFurness

Newgate Communica8ons PR Elisabeth Cowell/Megan Kovach Tel: 020 3757 6880

ISIN: GB00BFPMV798 Category Code:MSCH TIDM: TERN LEICode: 2138005F87SODHL9CQ36

EQS News ID: 900021

Sequence No.: 25849

End ofAnnouncementEQS News Service