Proposed IPO of Wyld Networks

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF EU REGULATION 596/2014 (WHICH FORMS PART OF DOMESTIC UK LAW PURSUANT TO THE EUROPEAN UNION (WITHDRAWAL) ACT 2018).  UPON THE PUBLICATION OF THIS ANNOUNCEMENT THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE WITHIN THE PUBLIC DOMAIN.

THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA, AUSTRALIA, NEW ZEALAND, JAPAN, CANADA, HONG KONG OR SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL OR WOULD REQUIRE REGISTRATION OR ANY OTHER MEASURES. PLEASE SEE THE IMPORTANT INFORMATION AT THE END OF THIS ANNOUNCEMENT.

9 June 2021

Tern Plc

("Tern" or the "Company")

Proposed IPO of Wyld Networks

Tern Plc (AIM:TERN), the investment company specialising in the Internet of Things ("IoT"), is pleased to announce the proposed IPO and admission to trading on the NASDAQ First North Growth Market ("NASDAQ First North") in Stockholm of the newly incorporated holding company of the Company's portfolio company, Wyld Networks Limited, Wyld Networks AB (publ) (together "Wyld Networks").

Highlights

·    Proposed IPO and admission to trading on NASDAQ First North in Stockholm of Wyld Networks, with the first day of dealing expected to be on 2 July 2021.

·  The proposed Wyld Networks IPO is intended to, inter alia, increase their brand recognition, enable them to raise additional funds for expansion, reduce their dependence on Tern for future funding and provide a public market equity valuation and liquidity for Wyld Networks' shareholders.

·    Proposed Wyld Networks IPO fund raising of SEK 25 million (approximately £2.1 million) in conjunction with the proposed IPO, which will be provided by third parties, Tern and Wyld Networks' management, with Tern being due to invest approximately £300,000.

·    Tern's holding in Wyld Networks expected to reduce from 78.7% to approximately 60% following the IPO.

Background

Wyld Networks develops and sells innovative wireless technology solutions that enables affordable terrestrial and satellite connectivity for IoT devices and sensors anywhere in the world, especially for the 85% of the world's surface where there are no mobile networks; and for connecting smartphones directly together into a wireless network without the need for 4G or Wi-Fi in areas where mobile networks are congested or not available.

Prior to the proposed approximately £2.1 million fund raising (the "Offering") in conjunction with the proposed IPO, further described below, Tern owns 78.7% of Wyld Networks' equity.  Following Wyld Networks' fund raising announced on 28 January 2021, Tern's holding had a book valuation of £4.1 million.

Following the Offering, the issue of incentive shares to Wyld Networks' management and admission to NASDAQ First North, Tern's holding in Wyld Networks is expected to reduce to approximately 60%, which will be valued at approximately £4.7 million on the basis of the proposed Offering price (as defined below).  Including Tern's proposed participation in the Offering, Tern will have invested approximately £1.75 million to date in Wyld Networks.  Tern's holding in Wyld Networks will be subject to lock in arrangements for a year from the proposed IPO.

To facilitate the proposed IPO a new holding company for Wyld Networks, Wyld Networks AB (publ) has been established and it is expected that this company's shares will begin trading on NASDAQ First North on 2 July 2021 .

The Offering

The Offering will consist of an issue of a maximum of 2,275,000 units, where each unit consists of one share and one TO1 Warrant and one TO2 Warrant (as defined below), corresponding to a fund raising of approximately SEK 25 million (approximately £2.1 million) before transaction costs (provided that the Offering is fully subscribed) and excluding any future income from the warrants.  The Offering will be conducted at a fixed price of SEK 11.00 per unit (the "Offering price"), corresponding to a total market value of the Wyld Networks' shares of approximately SEK 66 million (approximately £5.6 million) before the Offering proceeds. The Offering subscription period commences on 10 June 2021 and ends on 23 June 2021.

The warrants to be granted pursuant to the Offering will comprise one warrant series (the "TO1 Warrants") which enables the subscription of one new share in Wyld Networks at a maximum subscription price of 125 percent of the price in the Offering, corresponding to SEK 13.75 per share and a further warrant series (the "TO2 Warrants") which enables the subscription of one new share in Wyld Networks at a maximum subscription price of 150 percent of the price in the Offering, corresponding to SEK 16.50 per share. A maximum of a further approximately SEK 69 million (approximately £5.9 million) could therefore potentially be raised if all of the warrants to be granted pursuant to the Offering were to be exercised. The subscription period for the TO1 Warrants will commence on 22 March 2022 and end on 4 April 2022, and the subscription period for the TO2 Warrants will commence on 6 December 2022 and end on 19 December 2022. Both series of warrants are intended to be admitted to trading on Nasdaq First North.

Subscription commitments of approximately SEK 20 million (approximately £1.7 million), corresponding to approximately 80% of the Offering have already been made.  This includes approximately £300,000 from Tern and further amounts from certain of Tern's Directors (amounting to approximately £55,000) and Wyld Networks' management to support the Offering.

The net proceeds of the Offering are expected to be used by Wyld Networks to:

·    Build its commercial team with direct and reselling programmes (45%)

·    Expansion of its engineering teams (38%)

·    Establish North American and Asian operations (17%)

Complete terms of the Offering are available in a Swedish language prospectus, approved and registered by the Swedish Financial Supervisory Authority, that has been published today and is available on Wyld Networks' website, www.wyldnetworks.com.  A subscription form for the Offering is also available on Wyld Networks' website.

Tern's Chief Executive Officer, Al Sisto, will remain as a non-executive director on Wyld Networks' board.

For the year ended 31 December 2020, Wyld Networks' audited loss for the year was SEK9,536,000 (2019: loss of SEK 6,602,000) on net sales of SEK 2,475,000 (2019: SEK 1,559,000) and its audited total assets as at 31 March 2020 were SEK 5,752,000 (31 December 2019: SEK 5,636,000).

Mangold Fondkommission AB is acting for Wyld Networks as Certified Adviser, financial adviser and sole bookrunner for the Offering.

A further announcement will be made by Tern in due course.

Commenting Al Sisto, CEO of Tern, said:

"We are very pleased that Wyld Networks is announcing its proposed IPO today.  We believe that having a transparent public markets valuation for Wyld Networks and giving the business access to further capital from a public market, as required, is in the best interests of Wyld Networks, Tern and its shareholders.  The proposed IPO is recognition that Wyld Networks has now reached the appropriate stage of development under Tern's guidance and support to become a publicly quoted company and the IPO forms part of Tern's strategy to maximise shareholder value.

"However, following the proposed IPO Offering Tern will continue to hold approximately 60% of Wyld Networks' shares, remaining its majority shareholder, and will benefit from any future share price appreciation.  We believe that Wyld Networks has an exciting future ahead of it and the IPO structure ensures it remains a key part of our portfolio and Tern's shareholders should benefit from a large part of its future value.

"We look forward to reporting on future developments with Wyld Networks and our other portfolio companies in due course."

Enquiries

Important information

The release, announcement or distribution of this announcement may, in certain jurisdictions, be subject to restrictions. The recipients of this announcement in jurisdictions where this announcement has been published or distributed shall inform themselves of and follow such restrictions. The recipient of this announcement is responsible for using this announcement, and the information contained herein, in accordance with applicable rules in each jurisdiction. This announcement does not constitute an offer, or a solicitation of any offer, to buy or subscribe for any securities in Wyld Networks in any jurisdiction, neither from Wyld Networks nor from someone else.

This announcement does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in Wyld Networks.

This announcement does not constitute or form part of an offer or solicitation to purchase or subscribe for securities in the United States. The securities referred to herein may not be sold in the United States absent registration or an exemption from registration under the US Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold within the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There is no intention to register any securities referred to herein in the United States or to make a public offering of the securities in the United States. The information in this announcement may not be announced, published, copied, reproduced or distributed, directly or indirectly, in whole or in part, within or into the United States (including its territories and provinces, every state of the united states and the District of Columbia), Australia, New Zealand, Japan, Canada, Hong Kong or South Africa or in any other jurisdiction where such announcement, publication or distribution of the information would not comply with applicable laws and regulations or where such actions are subject to legal restrictions or would require additional registration or other measures than what is required under Swedish law. Actions taken in violation of this instruction may constitute a crime against applicable securities laws and regulations.

This announcement is not a prospectus for the purposes of the Prospectus Regulation and has not been approved by any regulatory authority in any jurisdiction. A prospectus approved and registered by the Swedish Financial Supervisory Authority in connection with the Offering has been prepared and will be published by Wyld Networks on Wyld Networks' website.

Forward-looking information

This announcement contains forward-looking statements that reflect Wyld Networks' intentions, beliefs, or current expectations about and targets for Wyld Networks' future results of operations, financial condition, liquidity, performance, prospects, anticipated growth, strategies and opportunities and the markets in which Wyld Networks' operates. Forward-looking statements are statements that are not historical facts and may be identified by words such as "believe", "expect", "anticipate", "intend", "may", "plan", "estimate", "will", "should", "could", "aim" or "might", or, in each case, their negative, or similar expressions.

The forward-looking statements in this announcement are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although Wyld Networks' believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurances that they will materialize or prove to be correct. Because these statements are based on assumptions or estimates and are subject to risks and uncertainties, the actual results or outcome could differ materially from those set out in the forward-looking statements as a result of many factors. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this announcement by such forward-looking statements. The information, opinions and forward-looking statements that are expressly or implicitly contained herein speak only as of its date and are subject to change without notice.