Agreement to Acquire

ngmoco, Inc
October 12, 2010

DeNA Co., Ltd

Purpose of the acquisition

Acquisition of ngmoco will make DeNA the global leader in

social gaming platform on smartphones

„ For users

• Delivery of wide varieties of social games from all over the world on a
common gaming platform with strong community functions
• Become the most popular entertainment environment on smartphones

„ For game developers all over the world

• One source solution: Provide an environment that enable developers to

distribute games simultaneously through iOS and Android devices to
global markets (Mobage-town and plus+ Network)

• Creation of large-scale communities of heavy game users to effectively

support monetization
 ngmoco’s competitive edge and synergies with DeNA

Competitive edge × Synergies

Provides the plus+ social network platform which

includes games developed by third parties
ƒ Cross-gaming community rankings and profiles, etc.
ƒ Participation of 119 titles including third party games
ƒ Over 12 million registered users
ƒ Android versions to be released during 2010
z Expansion of Plus+ Network’s game lineup
through introduction of DeNA Group games
z Combination of know-how and functions of
community operations

ngGame engine provides X-device( iOS and

Android) development platform for game
developers z By mounting ngGame on the Mobage
open platform, game developers
ƒ Allows developers to develop games for iOS and Android using common
codes worldwide can realize more efficient X-
ƒ Allows for efficient game development through incorporation of border expansion, in addition to X-device
technologies accumulated through internal development to ngGame
ƒ Games developed through ngGame can automatically be played in the z Substantial expansion of third party game
Plus+ Network lineups for Mobage-town and plus+
ƒ Platform expected to be opened to third party developers during the first Network
half of 2011

Industry leader in development and operations of

smartphone games z Expansion of third party game lineup for
ƒ Mainly free-to-play social games with virtual items monetization Mobage
ƒ 17 titles ranked in the Top 10 for iOS App store
ƒ Total downloads : Over 50 million z Combination of monetization know-how from
ƒ Android version to be released during 2010 (through ngGame) both companies
 Accelerate X-device, X-boarder strategy for smart phones by ngGame

„
„ By
By introducing
introducing ngGame
ngGame to
to the
the mobage
mobage open
open platform,
platform, DeNA
DeNA can
can efficiently
efficiently provide
provide enhanced
enhanced lineups
lineups to
to users
users

Users in Japan Users in US and Europe

Mobage-town for smart phones Plus+ (ngmoco gaming platform）

Single development
effort supports both X−boarder
Mobage and Plus+

iOS iOS
Android Android
（iPhone, iPad etc） （iPhone, iPad etc）
Single development
effort supports both X−device X−device
iOS and Android

Game Game Game Game Game Game Game Game

ngGame engine（SDK）
Efficient game
development through
tools packed with
accumulated know-
how
Game developers in Japan Game developers in US and Europe
Overseas strategy for smartphone games

„
„ Continuous
Continuous investments
investments to
to expand
expand game
game assets
assets and
and opening
opening platforms to 33rd
platforms to rd parties
parties

Continuous launch
of original titles – Utilize assets of Promote further Accelerate
Export successful acquired/alliance capital alliance developing new
titles in Japan, etc companies actively 3rd parties
developer B
ngmoco 3 rd Par
Gameview ty
Original nt
e
Developm
per A
develo

Astro Ape

etc.
etc. etc.
etc.
etc.

DeNA ×ngmoco Social game platform for smartphones overseas

, DeNA’s English language platform, to be transferred to
 Summary of Acquisition

Acquisition
Exchange of 100% of ngmoco outstanding common stocks for cash, common stocks and warrants of DeNA
Structure

Acquisition Maximum US$403 million (approx. JPY34.2 billion)

Consideration ※ Exchange rate : 1 USD ＝85 JPY

„ At closing Total of US$303 million ( approx. JPY25.7 billion)

¾ Common stocks US＄146 million （ approx. JPY12.4 billon)
¾ Warrants of DeNA US＄27 million ( approx. JPY2.3 billion)
¾ Cash US＄128 million ( approx. JPY10.9 billion)
Acquisition
Consideration „ Earnout （Dependant on financial results*1） Total of up to US$100 million (approx. JPY8.5 billion)
Details ¾ Common stocks US＄31 million ( approx. JPY2.6 billion)
¾ Warrants of DeNA US＄12 million ( approx. JPY1 billion) *2
¾ Cash US＄56 million ( approx JPY4.8 billion)
*1 Determined based on the annual financial results of the ngmoco ending December 2011, and paid by approx. June 2012
*2 No new stock option will be issued but the exercisable number of stock option granted at the Closing will be increased

„ New issuance of common stocks: 5,006,210 shares

„ No financing will be necessary for cash payments (DeNA has cash balance of JPY 34.2 billion as of
Financing August 31, 2010)
„ Shares issued for exercised warrants and for earnout consideration (Total 2,888,070 shares at
maximum) will be provided from DeNA treasury stocks (3,370,861 shares as of October 12, 2010)

„ 3.4% (3.5% on voting rights basis) by the new issuance of shares at Closing
„ 4.4% (4.5% on voting rights basis) if all the warrants granted at Closing are exercised (in addition to
Dilution the above)
„ Maximum 5.4% (5.5% on voting rights basis) on the total consideration basis including earnout

Closing November 9, 2010 (planned)

 Structure summary (1)

【Step 1 and Step 2】 Target subsidiary and establishment of a limited liability company, funding 【Step 3】 Merger of Target subsidiary and ngmoco

① ① Cash Stock option

The Company ② The Company Shareholders
② Payments for owners
③ common shares
④ and warrants of
the Company
③ Issuing common
shares and
DeNA Global warrants of the DeNA Global
Company
④ Cash

LLC Target subsidiary LLC Target sub. Merger

ngmoco
(SUB2) (SUB1) (SUB2) (SUB1)

„ In Step 1, the Company established a Target subsidiary named “Stream
Acquisition Corporation” in Delaware, USA (allocation target, the “SUB 1”),
and DeNA Global (Consolidated subsidiary of The Company） established a
limited liability company named “Stream Acquisition LLC” (the “SUB 2”). The
Company will contribute cash to SUB 1 by providing new capital investments
to SUB 1, to provide SUB 1 with necessary funds to acquire third-party
allocation of the Company’s shares and warrants.
„ In Step 3, SUB 1 and ngmoco will be merged, with ngmoco as the
surviving entity and SUB 1 as the disappearing entity (“new ngmoco”).
SUB 1 will deliver the Company’s common stock and cash to ngmoco
shareholders and the Company warrants to ngmoco stock options holders
as compensation for the merger.

„ In Step 2, the Company will issue new shares and warrants to SUB 1
through third-party allocation of shares, and SUB 1 will subscribe for such
shares, so that SUB 1 may acquire the Company’s shares and warrants
issued as compensation for the merger between SUB 1 and ngmoco. (By
doing so, the cash contributed by the Company to SUB 1 in Step 1 will return
from SUB 1 to the Company as payment for the new issuances and as a
result there will be no substantial cash outflow for this acquisition)
Additionally, by assuming new capital injections to SUB 1, the Company will
contribute to SUB1, funds equivalent to the cash amount that SUB 1 will
deliver as compensation for its merger with ngmoco.
 Structure summary (2)

【Step 4 】 Limited liability company (SUB2) / ngmoco merger 【Final Scheme】 Final scheme structure

The Company The Company

DeNA Global DeNA Global

LLC Merger
new ngmoco ngmoco LLC
(SUB2)

„ In Step 4, immediately following Step 3, the new ngmoco of Step 3 will be

merged with SUB 2 formed in Step 1, with the new ngmoco as the
disappearing entity, and SUB 2 will subsequently change its name to
“ngmoco LLC”. As a result, ngmoco will become the 100% subsidiary of
DeNA Global, the wholly-owned US subsidiary of the Company.
 Summery of target company

C o m p a n y ngmoco, Inc.
N a m e
L o c a t i o n San Francisco, USA
F o u n d a t i o n June 2008
B u s i n e s s Development and sales of social gaming applications for smart phones

C a p i t a l US$39,591,000
„ Venture company founded in Silicon Valley, California to provide gaming applications for iPhone /
iPod touch

„ Provide social game platform “Plus + Network” with 3rd party developed game
Highlight
„ Leader in development and operation of social gaming applications for smart phones.
ngmoco gaming application ＆ platform

Gaming application for iPhones

z
z High
High quality,
quality, charged
charged byby item
item
z
z 17
17 titles
titles have
have ranked
ranked in
in the
the top
top 10
10 in
in Apple
Apple
App
App Store
Store
z
z Over
Over 50 50 million downloads （as
million downloads （as of
of Sep
Sep 2010）
2010）
z
z Plan
Plan to
to release
release Android
Android model
model within
within 2010
2010

Plus+ Network
z
z Community
Community platform
platform across
across games
games
z
z 119
119 titles
titles participate including 33rdrd party
participate including party
z
z Over
Over 1212 million
million registered
registered users
users
Forecasts and assumption made in this material are based on information
that are currently available and therefore may contain uncertain data.
Actual results may differ due to various changing factors and conditions.

DeNA Co., Ltd