Smart Digital Technology Group Limited — Capital/Financing Update 2016

May 12, 2016

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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DIGITAL DOMAIN HOLDINGS LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code: 547)

BUSINESS UPDATE

The board of directors (“Board”) of Digital Domain Holdings Limited (the “Company”, together with its subsidiaries, “the Group”) is pleased to provide an up-date on the development of its visual effects (“VFX”), computer graphics (“CG”), virtual reality (“VR”) and virtual human and immersive entertainment businesses, in particular in the Greater China market:

Collaboration with Youku

The Group is pleased to report that it is in discussions with a wholly owned subsidiary of Youku Tudou Inc. (youku.com) (“Youku”), China’s leading media, cultural and entertainment industry player, Internet platform and content provider, to finalise contract documents for a content licensing scheme to enable the distribution and broadcast in Greater China via Youku platform of CG, VFX and 360 live streaming and pre-recorded video and VR, augmented reality and immersive media contents produced and/or owned by the Group for select content to be agreed, and the joint development, production and exploitation of 360 live streaming and pre-recorded video and VR, augmented reality, and immersive media contents based on the rights to use or access all Youku’s contents and/or events.

The Group may also pursue discussions for the formation of a joint venture or similar collaboration with Youku for the development and operation of virtual human business, and the possibility of an equity investment by Youku in the Company.

Potential collaboration with other content owners, producers, distributors and strategic partners

Recently, the Group signed a cooperation agreement relating to the development of 3D virtual human images of the deceased canton pop diva Anita Mui and a cooperation agreement for the 360 VR audio and visual content production of a great Chinese classic novel. The Group is also in discussions with other independent third parties on collaborations with respect to movies and TV series as well as variety shows, concerts and virtual human productions.

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To support the Group’s proactive growth strategy, it also continues to seek opportunities for financing (including financing through the issue of equity or debt securities by the Company or a combination of both) and collaboration with other strategic partners.

Shareholders and investors should note that the possible transactions described above, which are subject to contract documentation being signed by the parties, may or may not proceed and accordingly, they should exercise caution in dealing in the securities of the Company.

By Order of the Board DIGITAL DOMAIN HOLDINGS LIMITED Seah Ang Executive Director and Chief Executive Officer

Hong Kong, 12 May 2016

As at the date of this announcement, Mr. Peter Chou, Mr. Seah Ang and Mr. Amit Chopra are the executive directors of the Company and Ms. Lau Cheong, Mr. Duan Xiongfei and Mr. Wong Ka Kong Adam are the independent non-executive directors of the Company.

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