On 30 September 2016, CITIC, SBCVC and [a private investor (Zheng Hao Investments Limited (“Zheng Hao”))] acquired the convertible notes in the principal amount of HK$[84] million, HK$[84] million and HK$[22.512] million, respectively from Harmony Energy Limited, holder of convertible notes issued by the Company in the principal amount of HK$190.512 million. Immediately after full conversion of the above-mentioned convertible notes, CITIC, SBCVC and Zheng Hao will hold [2,100,000,000 shares], [2,100,000,000 shares], [562,800,000 shares] respectively and represent approximately [9.69%], [9.69%], [2.60%] of the issued share capital of the Company as enlarged by the conversion of all convertible notes issued by the Company respectively.

Digital Domain also entered into subscription agreements with CITIC and SBCVC (together referred to as “subscribers”) respectively, under which the Company has conditionally agreed to allot and issue an aggregate of [363,636,304] shares to the subscribers and/or their respective nominees at a subscription price of HK$[0.55] per share. The subscription shares represent approximately [3.06%] of the existing issued share capital of the Company of [11,877,709,220] shares and approximately [2.97%] of the issued share capital of the Company of 12,241,345,584 shares as enlarged by the subscription. The subscription price represents a discount of approximately 9.84% to the closing price of HK$0.61 per share on 30 September 2016.

The net proceeds raised from the subscription will be approximately HK$[199,850,000] million, and are intended to be applied towards media entertainment segment and used for general working capital purposes of the Group.

CITIC and SBCVC have also undertaken to the Company pursuant to the subscription agreements that each shall agree to the extension of the maturity date of the convertible notes by no more than five years.

With 23 years of history and a legacy of bringing revolutionary change to the global visual effects industry, Digital Domain advocates in the exploration of virtual reality (VR) and virtual human (VH) technologies as the Company’s key business development. Digital Domain is the only company in the world fully capable of bridging powerful computer graphic imagery creation and 360-shooting hardware and software to create a unique VR universe of Digital Domain that influences every aspect of life. The Company has collaborated with numerous multinational corporations and renowned global organizations in the international business including DreamWorks Animation and Democratic National Convention Committee, while officially expanding its business to the Greater China market in 2016 through acquisition of Post Production Office, thereafter renamed as DDPO, and conclusion of strategic partnerships with media and entertainment industry giants in the region including Youku, Warner Music, and CTi TV. The Company aims to create the latest, the most exciting and the most authentic VR and intellectual property (IP) contents for the world’s entertainment industry riding on its leading position in the global entertainment industry, Hollywood-caliber VR technology and talents.

Mr. Daniel Seah, Executive Director and Chief Executive Officer of Digital Domain Holdings Limited, said, “As Digital Domain’s footprint broadens, we are always looking for opportunities to grow our media and entertainment business and further penetrate the VR market. The introduction of strategic investors into the Company not only represents their confidence in Digital Domain’s solid business foundation, sound strategy and robust potential, but also offers Digital Domain additional funds, increasing our capital base for future business development. Combining CITIC’s abundant global resources and SBCVC’s vision and experience in technology, media and telecom investments with Digital Domain’s top-notch technology and dedicated management team, we will continue to leave our mark in global and Greater China markets and strive to become the world’s best creator and proprietor of VR content.”

Mr. Pu Jian, Executive Director of CITIC Limited, said, “We are happy to ink a partnership with Digital Domain to develop virtual reality and related technology via the share subscription. We recognize the potential of VR development globally, particularly in the Greater China market, and Digital Domain’s industry-leading VR and IP content creation capabilities make it a good partner to tap the VR market worldwide.”

“We are very impressed by the vision and energy of the professional management team led by Daniel. As a proven leader in the global entertainment industry with Hollywood-caliber VR technology and talent, we see immense growth potential in the company. We are confident in the leadership of Daniel and his management team to realise the Company's strategic potential, and is therefore happy to be able to play a part in its growth,” said Dr. Alan Song, Managing Partner of SoftBank China Venture Capital, a renowned TMT focused venture capital and private equity firm investing in high-tech and high growth companies in the Greater China Region.

About Digital Domain

Digital Domain Holdings Limited (“DDHL” together with its subsidiaries, the “Group”) is listed on the Main Board of The Stock Exchange of Hong Kong Limited (stock code: 547). DDHL is a diversified investment holding company with its operating and investment businesses spanning Hong Kong, the United States, Canada, Mainland China and other countries, encompassing businesses such as media entertainment, visual effects production, co-production of movies, property investment, and trading.

In July 2013, the Group acquired Digital Domain 3.0 Group comprising Digital Domain 3.0, Inc., Digital Domain Productions 3.0 (BC), Ltd. and Mothership Media, Inc. Digital Domain 3.0 Group has a history of over 20 years and has manifested itself as the leading digital production company that mainly engaged in the production of VFX, animations and movies. DDHL is also currently focused on building a library of live/recorded 360^o content through its subsidiaries, Immersive Ventures Inc. and IM360 Entertainment Inc. so as to build and grow virtual reality technology (including the 360 digital capture technology) in the mainstream media and entertainment fields.

DDHL has also strengthened its VFX and post-production services in Greater China through the acquisition of Post Production Office Limited (“PO”) in April 2016. Founded by global renowned entertainment icon Mr. Nicholas Tse, PO is engaged in the provision of post-production services for films, TV shows, advertisements, mobile apps, online games, micro-films and animations. The Group also completed the acquisition of Digital Domain 3.0’s stake from Prime Focus Limited in June 2016, giving DDHL sole ownership of the visual effects house. DDHL and Prime Focus also plan to provide post production and visual effects services to the advertising, animation and virtual reality industry.

Corporate Website: www.ddhl.com

About CITIC

CITIC Limited is China’s largest conglomerates operating domestically and overseas. With businesses in financial services, resources and energy, manufacturing, engineering contracting and real estate as well as others. CITIC’s rich history, diverse platform and strong corporate culture across all businesses, ensure that CITIC Limited is unrivalled in capturing opportunities arising from China’s continued growth. CITIC Limited is listed on the Stock Exchange of Hong Kong (SEHK:267) where it is a constituent of the Hang Seng Index. CITIC Group, a Chinese state owned enterprise, owns 58% of CITIC Limited.

Corporate Website: www.citic.com

About SBCVC

Established in 2000, SoftBank China Capital (SBCVC) is a leading venture capital and private equity firm that manages both USD and RMB funds. SBCVC’s investment focuses on high-tech, high growth companies in TMT, clean technology, healthcare, consumer/retail, and advanced manufacturing sectors; and SBCVC invest across all stages of companies. SBCVC has a proven track record and solid reputation in identifying high potential start-ups and creating successful industry-leading companies. Some of SBCVC spotlight portfolio companies are Alibaba, Taobao, Focus Media, GDS, Shenwu, Precise, Di'an, and Edan. SBCVC has operational offices located in Shanghai, Beijing, Tianjin, Suzhou, Chongqing, Chengdu, Xi'an, Hangzhou, Nanjing, Shenzhen, Singapore, Hong Kong and Taiwan.

Corporate Website: www.sbcvc.com