#1EMBRACER+ GROUP Embracer Group acquires Dark Horse 21 December 2021#2Embracer acquires er Dark Horse Today's Speakers SCU al UMBRELLA ACADEMY HORSE HORSE DARK DARK Mike Richardson Founder & CEO Dark Horse Neil Hankerson COO of DHM Dark Horse DARK HORSE Vanessa Todd-Holmes VP of P&S Dark Horse TIME B 3 EMBRACER* GROUP Lars Wingefors CEO Embracer Group TER SECON 3R-JO 2967 A PRED HELLBOY#3About Dark Horse Dark Horse Comics was founded in 1986 by Mike Richardson as an offshoot of his Oregon comic-book retail chain, Things From Another World. Dark Horse is a leading entertainment company with a vast content library. One of the largest comics publisher in the United States ● ● Dark Horse Intellectual Property performs well across all mediums. Critically acc Critically acclaimed publications and live-action films, and animated content Proven ability to develop and produce IP suitable for multiple distribution platforms (e.g., publishing, consumer products, film, television, and streaming) Leading creative team & external relationships that continually fuel the Dark Horse content engine TIMETH lie HQ Milwaukie, Oregon 181 FTE's PRED LOR EMBRACER+ GROUP TER SECON 30-39 29671 HELLBOY#4The Dark Horse Story "PORTLAND, OREGON NATIVE MIKE RICHARDSON ATTENDS PORTLAND STATE UNIVERSITY, STUDYING ART WHILE PLAYING BASKETBALL... 1994 THE MASK OPENS #1 WORLDWIDE. NEXT #1 IS TIMECOP... TIMECOP WITH A CREDIT CARD LIMIT OF $2,500, MIKE CREATES PEGASUS BOOKS IN 1980 (LATER TFAW), WHICH WOULD EVENTUALLY GROW INTO ELEVEN STORES IN THREE STATES... 2008.. HELLBOY II: THE GOLDEN ARMY GROSSED $168MM WORLDWIDE... HELLBOY IT THE DOLOEN ARMY ALIY ...IN 1986, MIKE ESTABLISHES... 2012.. AVATAR: THE LAST AIRBENDER BECAME NEW YORK TIMES #1 BESTSELLER.. DARK HORSE COMICS WON FIVE EISNER AWARDS.... 降县中地 AVATAR THE LAST XIRBENDER DARK HORSE COMICS RK ORSE COMIC ...IN 1988, MIKE MEETS FILM EXECUTIVES LARRY GORDON & LLOYD LEVIN, OPENING HIS EYES TO THE POTENTIAL OF DARK HORSE STORIES ON THE BIG SCREEN ...2013 PARTNERSHIP WITH NINTENDO CREATED THE LEGEND OF ZELDA, OVER 1MM COPIES SOLD OF LEGEND OF ZELDA: HYRULE HISTORIA... ZELDA HYRULE HISTORIA DAIM ...2019 LAUNCHED PARTNERSHIP WITH NETFLIX AND UNIVERSAL TO RELEASE TV SERIES THE UMBRELLA ACADEMY N NETFLIX Today? ...THAT YEAR, MIKE FORMS A NEW VENTURE... DARK HORSE PRODUCTIONS THE UMBRELLA ACADEMY ...A FILM PRODUCTION COMPANY... (DH ENTERTAINMENT) JIM PASK DARK HORSE REIGNS AS THE LARGEST INDEPENDENT COMICS PRODUCER!" DARK HORSE COMICS "MIKE AND THE DARK HORSE TEAM NOW LOOK TO CAPITALIZE ON MEDIA AND FILM PRODUCTION TO EXPAND THEIR INNOVATIVE WORKS TO A GLOBAL AUDIENCE..." EMBRACER+ GROUP 2#5ACK Diverse I H AN 300+ 500 30 40 2.000 SECRET ORIGINS THE LEGEND OF DA JEFF LEMIRE DEAN ORMSTON DAVE STEW 7 Properties and growing Books published every year New comics each month Films & TV adaptations in pipeline BERSERK Network of creative comic book professionals NY days, and I can't remember time I read a superhero com I'm loving Black Ha In a mix of owned, controlled and licensed IP HYRULE HISTORIA + EMBRACER GROUP iki Ichi Illustrated by fai NOVEL#6Global Opportunity TE UMB ACAD $1.3 Billon Size of US Comic Market (2020) Greater than $1 Trillion Global Entertainment TAM TIMETH Intellectual property Comics & Graphic Novels Film & TV & Video Games Merchandise, Retail & Experience ED Expand Customer Reach EMBRACER+ GROUP TER SECON 31-79 2967 HELLBOY 6#7Strong Ties in the Games Industry Dark Horse is the go-to publisher for video games companies for comics and merchandise such as art books. Working with leaders in the category with brands such as The Legend of Zelda, Minecraft, The Witcher, Final Fantasy and Borderlands. Y DARKSIDERS DEATH'S DOOR VIGIL BASED ON THE HIT GAME FROM THQ and VIGIL GAMES ANDREW KREISBERG DAVID SLAGLE ROGER ROBINSON MICHAEL ATIYEH PLANTS ZOMBIES VS. FO OMNIBUS-VOLUME 1 XV MINECRAFT SFER. MONSTER SARAH GRALEY JOHN J. HILL VOLUME 3 MOJ ANG STUDIOS CREATED BY SPIKE CHUNSOFT MANGA BY KUROKIQ PANGAN PA 2 WONDERLANDS OODBYE ESPAIR BY 2 DR2 EMBRACER+ GROUP 66 THE LEGEND OF ZELDA HYRULE HISTORIA 7#8Intellectual property performs well across mediums Successful Publishing Titles I Owned HERBOY THE BONES OF GIANTS Hellboy BERSERK 三浦建太郎 Berserk MY NAME IS BRUCE USAGI YOJIMBO Usagi The Legend of ZELDA Zelda BARB WIRE NOW A MAJO MOON PICTURE MANS 降击神通 AVATAR THE LAST AIRGENDER Avatar MASK NIEUT JOHN ARCUDE DOUG WANNKE UMBRELLA ACADEMY Umbrella Academy TIMECOP DAZAK HORSE PRESENTS © WOW COMICS 10 BLACK BEETLE BLACK SINISTER BROOKLYN BLOOD MORE! SZAR Wow B.P.R.D. PLAGUE OF FROGS Feng ma BEATEC B.P.R.D her's GHOST OVERWATCH Controlled LE ANTHOLOGY Overwatch BLACK AGE OF DOOM JEFF LEMIRE DEAN ORMSTON DAVE STEWART TODD KLEIN Black Hammer Examples of IP Previously Exploited for Film/TV or Currently in Production/Set-Up WYRD. MYSTERY GIRL Curs Pires Antonio Pueo A FITIC Oresident THE SUICIDE BLONDE PASTE PARO Alien FALLOUT 3000 Fallout C HELLCHILD Last of Us THE LAST OF US CAIMAN BUSSELL AMERICAN GODS AMERICAN DREAMS American Gods SIX THRILLING CHAPTERS! MONARCH MOON MALIKA ORUPE kam KARTTA The Witcher HELLSING SHINJUKU MINK AMANO THE WITCHER RESH LAME ABUZZKIL KOHTA HIRANO Hellsing DEPTH MURDER SIX MILES DEEP EAT BUN DE TARTAL! HELLBOY THE BONES OF GIANTS EMBRACER+ GROUP 3#9Vast Content Library with Meaningful Opportunities for Monetization Properties Owned Controlled Licensed: - Publishing Only - Limited Rights Public Domain Total Number of Titles 170 280 164 159 3 9 623 Dark Horse's IP library spans across genres and demographics % of Total Perfectly matches multi-genre demand from streamers and traditional programmers 27% 45% 26% 1% 100% Exploited for Film/TV 11 36 2 2 0 0 Current entertainment production pipeline is split 80/20 between Controlled and Owned IP 46 Significant opportunity to scale entertainment revenue: currently, less than 15% of Dark Horse's exploitable IP is set up to produce revenue from video content leaving a valuable vault of over 300 titles available for production 1. Includes limited rights and rights under negotiation. Excludes expired rights (some are available for renewal). I Film/TV Rights Available¹ 159 147 3 1 2 9 321 Gaming Rights Available 159 56 1 1 2 9 225 240+ titles with merchandise rights Dark Horse's is well positioned to grow its IP library to 1,000+ titles - current near-term goal Creators choose Dark Horse for its unmatched value proposition and a 35-year track record of developing iconic brands and franchises EMBRACER+ GROUP 4#10Dark Horse Comics - What is the Mix of IP Sold? 2015A Avatar Last Airbender Zelda Plants vs Zombies Hellboy Fallout 29,6% 20,3% 50,2% 2018A Initial Sales 2016A World of Warcraft Avatar Last Airbender Hellboy Fight Club Berserk Sales Mix Shift 37,5% 26,8% 35,7% 2019A Top 5 Franchises by Print Publishing Sales 2015 - 2021 YTD 45,0% 27,1% 27,9% Frontlist Sales 2020A 2017A World of Warcraft Zelda Overwatch Berserk Hellboy 49,0% 26,9% 24,1% YTD July 2021 Backlist Sales 2018A Zelda Super Mario World of Warcraft Berserk Hellboy 2019A Berserk Umbrella Academy Plants vs. Zombies Avatar Last Airbender Hellboy 2020A Berserk Avatar Last Airbender Umbrella Academy Avatar Critical Role YTD 7/21 Berserk Avatar Last Airbender Avatar Hellsing Zelda Within Publishing, the majority of top sellers are licensed titles which Dark Horse hand-picked as winning comics titles Backlist sales (sales recorded after the first year of publication) increasingly greater % of total due to increasing digital sales EMBRACER+ GROUP 7#11Dark Horse Comics - How are the Comics Sold? % of DHM Sales YTD (7/31/21)² TFAW, LLC TFAW.com (70%) TFAW stores (30%) THINGS FROM ANOTHER WORLD Emily Company-managed retail locations specializing in comics and memorabilia 13% Titles Owned & Managed (72%) HELLBOY SPRD alien YOU L XXX Dark Horse IP Library Dark Horse Deluxe / Product Development MIDTOWN COMICS THIRD EYE Toys and merchandise sales via wholesale and direct to consumer 9% 1. Includes Public Domain. 2. Remainder of revenue attributable to DHC Sales and Licensing (3%) and DHE (5%). STRANGER KINIG Newbury Comics 3rd Party Licensed Content for Comics (28%)¹ ZELDA Inal STAR WARS & ARTIFACTS NAR Apng's Unfreezing Day Zyber PANK Distributors Penguin. Random House Diamond Comic Distributors, Inc. Reputable publishing relationships 71% EMBRACER+ GROUP 8#12I I I I I I. Dark Horse Digital is a subsidiary of Dark Horse Comics responsible for the publication of comic books in the digital format. It was established in 2011 I Dark Horse Comics - What is the eCommerce Strategy? I Dark Horse Digital I Dark Horse Digital began as an online digital comics I store and associated iOS app, with an Android app released in 2012 I I Strong momentum in digital comic sales. Spike in 2020 due to Covid-19 brick-and-mortar closures, but I growing sector overall I Increase in sales from $3.4mm to an estimated revenue of $6.7mm in 2024 $3,4 $3,4 $5,4 (0.5%) $4,3 58.4% $5,4 20% 2018 2019 2020 2021 2022 2023 2024 $6,2 25% 15% I I $6,8 10% 1. Includes all TFAW sales not just DHC sold through TFAW. I T I I I I Dark Horse Direct Horse Direct sells premium items and collectibles direct-to-consumer Dune: Sandworm Bookends I The Witcher 3- Wild Hunt: GICLÉE Print I Dark Horse Deluxe Dark Horse Deluxe sells products to 3rd party stores ELUSTOFAS PAILL The Last of Us: Ellie with Bow Statue Umbrella Academy: Séance Maquette Witcher 3: Wild Hunt: Geralt Grandmaster Ursine Figure TFAW Online $2,3 $2,5 $2,3 ▬▬ $5,0 $6,5 i $8,4 2019 2020 2021 2022 2023 2024 1.2 8.7% 100 % 30% 30% % $10,1 Other items sold over the internet include collectibles, toys and games and other miscellaneous pieces 2025 20% Increase in comic book sales from $2.6mm to an estimated revenue of $10mm in 2025 • Sales of collectibles are also expected to rise over time with a '18 - '21 CAGR of 22% and a '21'24 CAGR of 26.6% Toys and Games also see a similar rise from 95k in 2019 to 359k in 2025; resulting in a '21 - '24 CAG I I EMBRACER+ GROUP 9#13The Three Business Units Dark Horse Comics Sak The core business of Dark Horse is publishing comics and graphics novels of both own and licensed properties Hellboy and Star Wars, Japanese manga such as Berserk and Avatar The Last Airbender. Dark Horse is also a leader in game art collections with books like the best seller - The Legend of Zelda: Hyrule Historia Things From Another World A retail concept offering a wide range of comics, graphics novels, toys, statues and other pop-culture related collectibles, and a philosophy to offer excellent customer service, DATK Sli Founded in 1979 and consists of three retail locations and a website for e-commerce. TIMEL Dark Horse Entertainment A production company founded in 1992, which has since produced over 40 films and series, including the #1 box office hits and critically acclaimed series: MATTER ● The Umbrella Academy (2nd most viewed on Netflix) The Mask EMBRACER+ GROUP Timecop Hellboy TER SECON Resident Alien 30-791 ED HELLBOY#14Dark Horse Entertainment Core Business | Film, TV & Digital Video Since 1992, Dark Horse has worked with leading studios & networks to produce 40+ film and television series that have accumulated box office of over $1bn USD In 2019, the Company shifted its focus to streaming platforms and subsequently signed a multi-year, multi-property first-look deal with Netflix, with opportunities to partner with other platforms (e.g., Universal, Viacom, etc.) Chief Operating Officer Dark Horse Entertainment Senior Vice President 1 Report LLC VP Creative Affairs 1 Report VP Creative Affairs US-based production & development, but content consumed by global audience... Dark Horse has a first-look deal with Netflix and has projects at Universal, N Warner Bros, Paramount, Sony, Amazon, AMC as well as others and projects currently under consideration at nearly every studio and platform .... The studio (e.g., Netflix) purchases the right to produce a Film/TV show based on Dark Horse IP. The studio finances the production and owns the copyright of that production - the studio exploits that copyright by licensing distribution and ancillary rights In general, Dark Horse is attached to any subsequent productions as a producer and will earn producing fees and royalties/backend with a floor of the deal on the original production. Certain ancillary rights are held back for Dark Horse to continue to exploit For controlled IP entertainment rights deals with an independent creator are typically structured as 50/50 share of IP rights fees. Producer fees (guaranteed fees) and any additional percentage of box office proceeds and bonuses go directly to Dark Horse EMBRACER+ GROUP 10#15CARARD WAY&GABOR BA THE UMBRELLA ACADEMY POLAR 7 38 37 / 1 1717 Foothe PREDA resi alie Why Do Creators Choose Dark Horse? Unmatched Distribution Extensive relationships across the entertainment landscape; strong US penetration with growing international fanbase. Transparency with Creators Clear and fair compensation structure; adopted as the industry standard. Creative Control Commitment to the creator's original vision across mediums. Track Record 35 years of experience and success in an evolving media landscape. EMBRACER+ GROUP 15#16Acquisition Rationale Strategic move into transmedia that adds expertise within publishing comics, production of film and TV series. ● ● ● Deal Structure and Acquistion Rationale ● Big IP library and well-oiled pipeline: Dark Horse owns or controls a vast number of properties through their comic book publishing. This type of transmedia company fits perfectly within Embracer Group. 30 years in business: Diverse business with strong presence in comic books/graphic novels and film/tv-series. Years of IP investment position Dark Horse to further monetize its library across platforms in the near-to-long-term Games based on Dark Horse IP: Lot of untapped potential in bringing Dark Horse's properties to games. Represents a potential upside and synergies within Embracer Group. The companies are already working together. Dark Horse is a platform for the best content creators in the world. Perfect opportunity to match content creators with game developers Opportunity for transmedia collaboration - e.g. comics that supplement or pre-date release of major games or art books to be bundled with Embracer games as deluxe editions Greater access to film/TV for Embracer content - Dark Horse has relationships with studios, talent and writers that can bring Embracer IP over to screen media Transaction terms and financial contribution ● EMBRACER+ GROUP ● Net Sales 2021- SEK 900 million with SEK 130 million of operational Ebit. Forecasted to generate operational EBIT of SEK 140-180 in FY22/23 and SEK 170- 200 million in FY 23/24. This figures excludes any commercial synergies or planned M&A. 80% of the shares of Dark Horse are acquired from a seller based in Hong Kong. Remaining 20% of shares will be acquired from founder and CEO, Mike Richardson and COO Neil Hankerson. Both are committed to stay with the company. Post transaction business will remain as usual and there is no planned restructuring. Purchase Price Due to commercial reasons the specific transaction terms are not disclosed. The transaction will be accretive to adjusted earnings per share. Completion of Transaction The transaction is subject to certain customary conditions, including merger control approval, and is estimated to be completed by the end of January 2022. Dark Horse will become the 10th operative group as a subsidiary of Embracer Group 16#17Dark Horse becomes the 10th operating group of Embracer, continuing to operate independently Corporate structure post transaction Kicki Lars THE BOARD EMBRACER+ GROUP Klemens Anton Matthew Randy Stéphane THONORDIC Coffee Stain SABER INTERACTIVE gearbox Osoftware asmodee Klemens Per-Arne Ken Oleg Mike S DEEP SILVER Mamplifier DECA Easybrain DARK HORSE EMBRACER+ GROUP 17#18The new combined Embracer Group New group Post-closing EMBRACER* GROUP Op. Group Internal Studios IPS People Proposed acquisition of Asmodee announced 16th of Dec Includes all announced acquisitions of 21st of Dec Pre-Closing EMBRACER+ GROUP 8 86 260+ 9,000+ Asmodee 1 22 300+ 2,300+ Today's acquisitions 1 3 +300 850+ 10 111 860+ 12,150+ EMBRACER+ GROUP 18#19EMBRACER+ GROUP