4 July 2017

Tern Plc (TERN.L)

Device Authority Update

Tern Plc (TERN.L), the investment company specialising in Internet of Things, is pleased to provide an update on developments at its investee company, Device Authority Ltd. ("Device Authority").

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014

Patent valuation

ipCapital Group, Inc. ("ipCG"), a premier IP strategy consulting practice, has provided an independent valuation of six of Device Authority`s nine US patents as part of the process of finalising the accounts consolidating Device Authority`s financial statements. ipCG worked with Device Authority to perform an update to the 2013 Uniloc ipValue ModelSM which had considered approximately 260 global active issued patents and pending applications that addressed five primary markets. This update considered the Device Authority subset of this portfolio which substantially focuses on six granted patents, two of which were applications at the time the original model was completed. Today, Device Authority maintains a portfolio of nine US patents, out of a total of fifteen patents.

IpCG estimates the risk-adjusted Net Present Value of the subset portfolio to be approximately $9 million over a five-year period beginning in 2018, and $18 million over the life of the portfolio (with an average expiration year of 2030).

IpCG found the subset portfolio to be highly relevant to applications in the Transaction & Communication Security market. For example, this patent portfolio details technology capable of identifying all physical routing devices through which a packet has travelled, authentication of computing and communications hardware, detection of tampering attacks, and other actions critical for IoT security.

IoT security platform update

Device Authority has released the latest version of its flagship IoT security platform. One of the first products to deliver password management and Public Key Infrastructure ("PKI") certificates to devices without human intervention, Version 5.5 introduces unique Automated Password Management ("APM") technology to tackle the real-world challenges organisations are facing today with cyber attacks involving connected devices. KeyScaler`s APM reduces the challenge and removes the associated human risks of manually updating credentials on hundreds or thousands of IoT devices.

KeyScaler also includes an IoT PKI connector enabling Amazon Web Services ("AWS") customers to access it through the AWS Marketplace. The new AWS IoT PKI Connector supports certificate provisioning; revocation; `thing` creation and certificate assignment, which is critical to securing IoT applications, their devices and data.