Creating Value from Technology September 2015
Disclaimer 1
Vision Tern acts as a transformational catalyst which applies its expertise and network to create above average returns for its shareholders through building and selling its portfolio companies. 2
Investment Thesis Acquire controlling interests target one a year Transform business over three years Trade sale business target one a year Reward shareholders and use proceeds in other opportunities 3
History of Business Create Aim Status Infrastructure August 2013 Created Tern Plc (TERN.L) from AIM shell and completed capital reorganisation 2014 Confirmed investing company status through relevant investments (see appendix) September 2014 Made first acquisition Cryptosoft, data security company 2015 Developing Cryptosoft, Seeking second acquisition Reorganise 1 st Buy Commercialise 4
Experienced Management Team Angus Forrest Chairman Venture Capitalist ex CEO Billiam plc 11 successful exits from investments with 8 IPOs Al Sisto Director Venture investor in 8 tech companies. Sold Hifn to Exar Corp for $63M. Venture Partner Nauta Capital, Former CEO Hifn, CEO Phoenix Technologies, COO RSA Data Security Bruce Leith Director IT sales management for entire career, IBM, Dataworks, London Bridge, Software, Codestream, Misys Sarah Payne Finance Director Qualified with EY as Chartered Accountant. Head of Financial Planning at BBC. For past 7 years has been finance director for high tech companies. Executive Directors have 100 + years combined board experience sold 27 companies and been involved in over 100 transactions in the IT sector 5
Development Stages Stage 3 Realise Stage 1 Infrastructure Complete Add value Target buyers Review, Plan Business Model Product Recruitment Stage 2 Growth Strategic partners Marketing Awards Exports 6
Cryptosoft: First Active Investment. Cryptosoft is data security software which is market proven. It is hardware, software and security system agnostic. Cryptosoft secures data transmitted over public networks and stored in the cloud At IoT World exhibition in San Francisco, May 2015 Cryptosoft attracted interest as the only offer of a holistic security solution for IoT and M2M ecosystems 7
Today s IoT Connection Paradigm 8
How Cryptosoft Adds Value 9
Cryptosoft: Risk Landscape and Opportunity Security Challenges are the major IoT Downside Threats to Data Pace of Change Regulatory Challenges Increased Competition Lower Margins Job Losses 25% 25% 32% 28% 42% 38% 9% 2% 1% 1% 7% 6% 9% 91% Perceive Security related Issues with IoT 28% 38% Increased Security Threats Data Privacy Identity Access Management Attacks against connected Devices Compliance Requirements Security remains the single largest challenge for private enterprise & governments & will continue to be the single largest area of IT spend reaching $86b worldwide by 2016 according to Gartner. 10 Source: Cisco 2014
Cryptosoft: Immediate Tasks Convert 5 largest contract opportunities in UK & US Increase marketing Create brand awareness 11
Milestones Tern Finance director started (September) Interim accounts to 30 June (August) Review of investment(s) Cryptosoft Stage 1 infrastructure completed Strategic partners in UK and US 12
Tern plc: Balance Sheet 31 December 2013 2014 000 000 Investments 100 632 Current Assets 198 735 Total Assets 298 1,367 Current liabilities 118 163 Long term liabilities 155 261 Equity 25 944 Total Equity and liabilities 298 1,367 13
Creating Value from Technology Tern buys, builds & sells innovative companies in the cloud & mobile technology sectors with exit planned in 12-36 months. First realisation(s) expected within six months Cryptosoft developing rapidly Second acquisition planned Website: Ternplc.com Tern plc, 9 Catherine Place, SW1E 6DX info@ternplc.com 14
Company Ownership Executives have invested 600k in Tern ( 270k to be converted) Low overheads remuneration linked to asset realisations Percent Interest Shareholders Shareholder Name 29.0 Executive Group 11.2 Hargreave Hale 3.5 Jon Penney (Founder Crypto) 12.4 Six holders under 3% 15
Appendix: Initial investments Early Investments for monetisation Flexiant Ltd (c.0.7%) a global supplier of cloud orchestration software Investment cost 100,000 Push Technology (c.0.7%) distribution technologies, used by financial transaction businesses and now part of IBM s Bluemix, also pitching with IBM and being resold by Arrows Investment cost 100,000 Seal Software (c.0.5%) contextual search engine used by large companies & lawyers - Investment cost 50,000 16