Microsoft Softimage to Be Acquired by Avid Technology

REDMOND, Wash., June 15, 1998 — Microsoft Corp. today announced it has signed a definitive agreement to sell Softimage Inc., its wholly owned subsidiary based in Montreal, to Avid Technology Inc., a Massachusetts-based provider of digital video, film and audio solutions. As a result, Microsoft will own a minority stake in Avid and plans to continue its joint initiatives in digital television, interactive content development and other visual media technologies with Avid.

“For the last four years, Softimage has been an innovative leader in the digital media space and will continue this tradition of excellence as a part of Avid,”
said Craig Mundie, senior vice president, consumer platforms division, Microsoft.
“Microsoft will continue to be part of this success as an investor and strategic ally of Avid.”

Softimage has made major strides in providing state-of-the-art production tools for games development, films and commercials that have received numerous awards, including all seven films nominated for the Special Effects category at the 1998 Academy Awards ceremony as well as blockbuster games like Broderbund’s Riven, Sega’s Virtua Fighter series and Nintendo’s Mario64. Since its acquisition by Microsoft, Softimage has added more than 100 employees in Montreal, mainly graphics artists and developers, reaching approximately 300 today. During this time, Softimage also helped pioneer the adoption of the Microsoft® Windows NT® operating system in the professional media creation industry and established Digital Studio, a state-of-the-art high-end integrated environment and tool set for digital media creation.

“Over the past three years, Softimage has driven major breakthroughs in the industry,”
said Moshe Lichtman, president of Softimage.

We were the first to ship the highest performance
3-D animation and video production products on the Windows NT platform. We have built and introduced a revolutionary nonlinear production paradigm base on our Digital Studio architecture. At the same time, we have grown our installed base from fewer than 1,500 users to over 21,000 and our customer base from fewer than 700 to over 6,000. Joining the Avid team will enable us to dramatically accelerate our joint vision of an integrated production environment and to continue pushing the envelope on behalf of our clients and partners in the digital media space.”

Avid, the industry-leading provider of digital content creation tools for professional film, video and audio post-production, has a user base of more than 40,000 editors and artists. Avid’s digital media expertise is well positioned to build on Softimage’s revolutionary digital nonlinear production architecture and its powerful SOFTIMAGE® |DS and SOFTIMAGE|3D product lines.

“This deal is a win-win for all involved,”
Mundie noted.
“Avid gains the benefit of rapid expansion into the 3-D market, a video production solution that ideally complements its current offerings and a stronger alliance with Microsoft. Softimage joins the team of a proven industry leader that will help the company continue to grow and be a force in the digital media space. Microsoft gains a strategic ally for continued development on Windows NT and our digital media initiatives.”

Softimage and its employees will remain in Montreal and other Softimage locations around the world. The parties expect to close the acquisition during the latter part of July 1998, subject to

receiving clearance under applicable U.S. and Canadian laws and other customary closing conditions.

Founded in 1986, Softimage develops software for media-rich applications, including video, film, interactive games and CD-ROM applications. Products include SOFTIMAGE|DS (video production), SOFTIMAGE|3D (high-end animation), SOFTIMAGE|EDDIE (compositing) and Toonz (2-D cell animation). The company was acquired in 1994 by Microsoft. Additional information about Softimage and Microsoft can be found via the Internet at ( and respectively.

Founded in 1975, Microsoft (Nasdaq
) is the worldwide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day.

Microsoft and Windows NT are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

Softimage is a registered trademark of Softimage Inc., a wholly owned subsidiary of Microsoft Corp.

Other product and company names herein may be trademarks of their respective owners.

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