Foundation 9 Entertainment Acquires Pipeworks Software

FOUNDATION 9 ENTERTAINMENT, INC. ACQUIRES
PIPEWORKS SOFTWARE

Latest Strategic Move Adds Additional
Talent and Technology To North America’s Largest Independent Developer

LOS ANGELES and EUGENE, OR – April 12, 2005 –
Foundation 9 Entertainment, Inc., North America’s largest independent developer,
today announced that it has reached a definitive agreement to acquire Pipeworks
Software, an independent studio focusing on development of entertainment
software titles for major software publishers. After the transaction is
completed, Pipeworks will continue to develop video games for the Sony
PlayStation®2 computer entertainment system, the Xbox® video game system from
Microsoft, and the Sony PSP™ handheld entertainment system at its Eugene, Oregon
studio. Additionally, Pipeworks President and Co-Founder, Dan Duncalf, will join
the board of Foundation 9 Entertainment.

“Dan Duncalf, Dan White, and their team will
be a tremendous asset for Foundation 9,”said Andrew Ayre, founding partner and
co-president of Foundation 9 Entertainment, Inc. “We expect their excellent
technology and superb production processes to propagate across the company. We
started growing our relationship with Pipeworks through joint business
development and product development over the past few months, and we look
forward to the contributions the Pipeworks team will bring to Foundation 9.”

“Joining a larger company makes a lot of
sense for us right now, as it allows us to focus on making great games and opens
up a deluge of creative opportunities for all of our people,” said Dan Duncalf,
president of Pipeworks. “Foundation 9 has thrown out the welcome mat, which is a
rare feeling in the game industry, and we look forward to playing on a larger
stage, reaching a bigger audience, and helping build something truly exciting.”

This latest move follows the recent
announcement of the formation of Foundation 9 Entertainment, which itself is the
product of a merger between well known independent development companies, The
Collective, and Backbone Entertainment. Foundation 9 develops games for a wide
variety of platforms and genres. Notable forthcoming titles include Marc Ecko:
Getting Up Contents Under Pressure as well as Star Wars Episode III: Revenge of
the Sith, both from The Collective, and Backbone’s original title, Death, Jr.
which is being published by Konami. The Company has extended beyond video games
with product development and merchandising efforts in comic books, t-shirts,
action figures and more.

Pipeworks is probably best known for its
Godzilla titles but team members have also worked on a number of notable games
including Space Quest, Pro Pilot, Populous, Aces, 3D Ultra, Front Page Sports,
and Coaster. The studio’s Spigot engine is already in use in upcoming Foundation
9 Entertainment titles. Pipeworks is currently working on unannounced projects
for the PSP, PlayStation 2, and the next generation Xbox.

Details of the transaction are not being
disclosed.

Foundation 9 Entertainment develops games for
a wide variety of platforms including handheld, PC, online, Sony PSP™ handheld
entertainment system, Sony PlayStation®, Sony PlayStation®2 computer
entertainment system, the Xbox® video game system from Microsoft, Nintendo
GameCube™, Game Boy® Advance and DS video game systems. The company has
developed multiple million-unit sellers on the Game Boy Color, Game Boy Advance,
PlayStation, PlayStation 2, Xbox and PC platforms. Foundation 9 Entertainment
has also won numerous awards for children’s and online products through its
ImaginEngine brand.

About Foundation 9 Entertainment, Inc.

Founded in 1992, Foundation 9 Entertainment
is a premier developer of interactive entertainment products and properties, and
the largest independent games developer in North America. With studios in the
San Francisco Bay Area, Vancouver, Boston, Los Angeles, Newport Beach, Eugene,
and Honolulu, Foundation 9 Entertainment is a development powerhouse, uniquely
positioned to maximize the value of entertainment properties across all
entertainment genres.

Through its core brands, The Collective,
Backbone, Digital Eclipse, and Pipeworks, Foundation 9 Entertainment has worked
with the largest names in the game publishing world, including Electronic Arts,
Activision, Vivendi-Universal, and Take-Two Interactive, while developing more
than 250 games since its inception. The company creates titles for all age
groups and all platforms, through licensed and original IP, as well as contract
development. Foundation 9 Entertainment also holds the ImaginEngine brand as
part of its interactive entertainment operations. For more information, please
visit:
www.F9E.com