UPDATE: Digital Domain has been sold to Michael Bay. We first heard rumours from equipment suppliers on Monday. For those who follow Nuke and D2 Software, this is especially good news! Carl Stork, Digital Domain's new CEO, has a 20 year history as a technology innovator, and one of the things he's looking forward to is continued expansion of Digital Domain's software offerings. We have Carl Stork's initial comment on D2, with more to follow soon.

Fxguide got this quote directly, "The continued development of Nuke and expansion of solutions from D2 Software is a key part of the strategy for Digital Domain going forward," said Carl Stork, CEO of Digital Domain. "We are fully committed to this part of the business and customers can look forward to new, innovative developments for our high-end compositing and effects software."

The Hollywood Reporter broke the story this morning, here is the link to the article by Sheigh Crabtree

D2Bay/D2flag
The iconic pirate flag over the Venice home of Digital Domain

Here's the offical Press release:

Venice, Calif., May 16, 2006 -  Digital Domain, the Academy Award®-winning full-service digital studio and production company responsible for jaw-dropping visual sequences in such films as Titanic, Day After Tomorrow and I, Robot as well as commercials such as the recent Budweiser Super Bowl Superfan spot, has been acquired by South Florida-based Wyndcrest Holdings, LLC, a group led by director Michael Bay and investor John Textor.

Carl Stork, a long-time senior Microsoft executive and principal of Wyndcrest Holdings, has been elected chief executive officer and a member of the Board of Directors of Digital Domain, replacing Scott Ross who is stepping down as CEO and remaining a consultant to the company. C. Bradley Call will remain president and chief operating officer. Bay and Textor will co-chair the Board of Directors.

"At a time when every top grossing motion picture is relying on digital visual effects to help tell compelling and entertaining stories, we believe this translates into a bright future for companies in this field, and we believe Digital Domain represented a unique opportunity to invest," said Stork, whose accomplishments at Microsoft included leading the development of Windows® 95/98.  "The creative and talented team at Digital Domain has a great reputation in both the feature film business and in the commercial advertising community for high-quality, award-winning work. Adding the expertise, business acumen and diverse relationships of the Wyndcrest principals will allow Digital Domain to capitalize on the rapidly expanding opportunities in the entertainment business."

D2Bay/ross
Scott Ross

"On behalf of all involved with Digital Domain, I would like to thank Scott Ross for his remarkable contributions as a founder and leader of the company over the past 13 years," Stork said. "We intend to draw on his advice and counsel over the coming years and we wish him well in his future endeavors."

"Having worked with Digital Domain in the past, I am well aware of the talent and creativity of the team here, and understand first-hand why the company has a well-earned reputation for creative and high-quality work," said Bay. "Rapidly evolving digital visual effects technology is going to allow motion picture directors to tell even more compelling and visually stunning stories in the future, and we believe that Digital Domain is uniquely positioned to take advantage of these new technologies, as well as new distribution channels and platforms."

"Digital Domain is well-positioned with exceptional people and leading technology at a time when reliance on visual effects is increasing in every sector of entertainment," said Textor, who has known Bay since their days at Wesleyan University and has been his business partner for eight years. "We look forward to combining these attributes with a renewed commitment to build the commercial and film industries leading director-centric visual effects business. Through the addition of new capital and the appropriate strategic relationships, we are also committed to the extension of the Digital Domain business into the direct development of animated films and effects-reliant live action films."

"While we all believe we've accomplished a great deal in the industry, we're incredibly enthusiastic about the future as we believe this new ownership group will provide the necessary capital and strategic resources to allow us to grow our business profitably in both feature films and in advertising while retaining an environment that encourages our artists to strive for ever-greater heights of creative excellence," said Call, a decade-long Digital Domain executive who assumed the presidency of Digital Domain, as well as day-to-day responsibility for leading the company, in 2002.

"We know that our future depends on continuing to satisfy the creative needs of our clients in a manner, and on a budget, that other competitors cannot match",  Call added.

Stork will take over as Digital Domain CEO effective immediately.

ABOUT DIGITAL DOMAIN

Founded in 1993, Digital Domain is an award-winning full-service digital studio and production company that creates special visual effects and other visual imagery for feature films, commercials and music videos. A pioneer in digital effects, Digital Domain's business units have been recognized with awards from the top industry organizations. In its 13-year history, Digital Domain has won five Academy Awards®: two for Best Visual Effects (Titanic,What Dreams May Come); and three for Scientific and Technical Achievement for its proprietary imaging software. The company has also been nominated for three other Academy Awards® for Best Visual Effects (Apollo 13, True Lies, I, Robot). In addition, its excellence in digital imagery and animation has earned Digital Domain multiple British Academy (BAFTA) Awards, and Prix Arts Electronica and Prix Pixel INA awards.

Digital Domain's Commercials division provides digital imagery and animation for television commercials, working with the top commercial directors. Serving Fortune 100 companies, the division has built a reputation as an innovator and industry leader in television commercial production and is the largest and most-awarded creator of digital imagery in its field. To date, it has been awarded 34 Clio Awards, 22 AICP awards, 8 Cannes Lion Awards and numerous other advertising honors. The Commercials division has also produced multiple music videos working with artists that include The Rolling Stones, Faith Hill, Creed, Janet Jackson, Busta Rhymes, Bjork, Celine Dion, Michael Jackson and Nine Inch Nails, and has earned Grammy® and MTV Music Video of the Year Awards.

Digital Domain's D2 Software subsidiary was established to productize the software tools developed by Digital Domain, such as the company's Academy Award®-winning Nuke compositing package.

Using high-end digital software technology, Digital Domain capitalizes on the studio's extensive industry relationships and years of production experience to develop films of exceptional quality for an international audience. For more information, please see www.digitaldomain.com.

ABOUT WYNDCREST HOLDINGS

Wyndcrest Holdings, LLC, is a Florida-based private investment and acquisition firm focused on technology-related opportunities in entertainment, telecommunications and the Internet. Wyndcrest actively supports its portfolio companies to assure the optimal positioning and deployment of associated technologies as well as the efficient execution of related business plans.

Wyndcrest is comprised of five investment principals with significant financial and legal expertise in the closure of public/private mergers, acquisitions and investments, and in the operation of large, small and start-up companies. The principals, John Textor, Michael Bay, Jonathan Teaford, Carl Stork and Dan Marino, have direct extensive experience in the disciplines of management, technology development, strategic planning, business development and investment banking. For more information, please see www.wyndcrest.com.

Biographies

Michael Bay
Director and Producer
Principal - Wyndcrest Holdings, LLC
Co-Chairman of the Board, Digital Domain, Inc.

Michael Bay is one of the film industry's most successful action directors whose films, which include Bad Boys, The Rock, Armageddon, Pearl Harbor and Bad Boys II, have grossed more than $2 billion worldwide. Bay also founded the Platinum Dunes production company, and is a very successful producer under that banner with such films as The Amityville Horror, The Texas Chainsaw Massacre and The Island. Mr. Bay is currently directing Transformers: The Movie, Paramount's summer tent-pole motion picture that will premier on the Fourth of July weekend in 2007. Next up for Platinum Dunes is the prequel to Texas Chainsaw Massacre,The Hitcher, as well as The Birds and four other films on Platinum Dunes upcoming slate.

Mr. Bay also recently helped found a commercial and music video production entity, The Institute for the Development of Enhanced Perceptual Awareness, which represents several directors.

A Los Angeles native, Mr. Bay graduated from the prestigious film program at Wesleyan University, and then studied at Pasadena's Art Center College of Design. He began his career making music videos, earning praise for directing Donny Osmond's musical comeback video. Soon after, he was recruited by Propaganda Films, where he directed award-winning videos for such artists as Aerosmith, Tina Turner, Meat Loaf and the DiVinyls.

Segueing to commercials, Mr. Bay won a coveted Clio Award for his first television ad, for the American Red Cross. He went on to direct some of the most widely seen and best remembered commercials in history, including spots for Nike, Budweiser, Levi's, Bugle Boy, Coca-Cola, Isuzu, Miller, Mercedes and the latest provocative Victoria's Secret campaigns. Perhaps his most honored ads and among the most imitated are from the Got Milk? commercial campaign, which Bay created. He won a Grand Prix Clio for Commercial of the Year for the Got Milk?/Aaron Burr spot, which was dubbed one of the top ten commercials of all time by USA Today and the History Channel. Mr. Bay also garnered the Museum of Modern Art Award for Best Campaign of the Year. By the age of 26, Mr. Bay had won every major directing prize for commercials, including many Gold and Silver Lions at Cannes, and a Directors Guild of America Award for Outstanding Directorial Achievement for Commercials.

John Textor
Managing Principal - Wyndcrest Holdings, LLC
Co-Chairman of the Board - Digital Domain, Inc.

John Textor has served as managing principal of Wyndcrest since founding the company in 1997. In connection with Wyndcrest, Mr. Textor often holds positions of leadership within Wyndcrest portfolio companies. He currently serves as co-chairman of the recently acquired Digital Domain, Inc., a leading special effects and animation company based in Venice, California. Since 2002, he has served as chairman and CEO of BabyUniverse, Inc. (Nasdaq POSH), a leading female-focused e-commerce and new media company, based in Jupiter, Florida. Mr. Textor also served as chairman and CEO of Sims Snowboards, a top-tier worldwide snowboard brand. Mr. Textor was a founding director of a Wyndcrest portfolio company, Lydian Trust Company / Virtual Bank.com, a Palm Beach-based diversified financial services with nearly $2 billion in assets and $8 billion of assets-under-management. Mr. Textor is currently a director of Multicast Media Networks, Inc., the leading provider of live and pre-recorded Internet television broadcast networks.

Prior to Wyndcrest, Mr. Textor was jointly responsible for strategic planning and corporate finance for the Michael Swerdlow Companies, a $1 billion merchant banking joint venture among Nelson Peltz, Peter May and Shearson Lehman Hutton. Previously, Mr. Textor was employed in the New York Investment Banking Group of Shearson Lehman Hutton. Mr. Textor earned a Bachelor of Arts degree in Economics at Wesleyan University in Middletown, Connecticut.

Carl Stork
Principal - Wyndcrest Holdings, LLC
Chief Executive Officer and Director - Digital Domain, Inc.

Carl Stork is a principal of Wyndcrest and has been involved with Wyndcrest portfolio companies since May 2000. In connection with his responsibilities at Wyndcrest, he serves as chief executive officer and a member of the Board of Directors of Digital Domain, Inc., a leading special effects and animation company based in Venice, California. Mr. Stork is also president and founder of Ciconia & Co, LLC, a private investment firm based in Seattle, Washington.

Prior to founding Ciconia, Mr. Stork had a long and varied career at Microsoft Corporation from 1981 to 2002, serving in a variety of executive management positions, including technical assistant to Bill Gates, general manager of Windows® 95/98 and general manager of Hardware Strategy and Business Development. Mr. Stork served on the Board of Directors of Lydian Trust Company until March 2005, and currently serves on the Board of Directors of Neomagic Corporation, a semiconductor developer of application processors and mobile TV solutions for hand held devices, and Baby Universe, a leading online retailer of brand name baby, toddler and maternity products. Mr. Stork is also a partner in the Baseball Club of Seattle, owner of the Seattle Mariners major league baseball team.

Mr. Stork earned a master's degree in Business Administration from the University of Washington following a bachelor's degree in Physics from Harvard University.

C. Bradley Call
President and Chief Operating Officer - Digital Domain, Inc.

Brad Call is president and chief operating officer of Digital Domain with day-to-day responsibilities for all company activities, including Feature Film Visual Effects, Commercials, Digital Studio, and the company's business development and legal affairs activities. He joined the organization in 1996 and was promoted to his present position in 2002.
During Mr. Call's tenure, the firm has garnered five Academy Awards® -- two for Best Visual Effects (Titanic, What Dreams May Come), and three for Scientific and Technical Achievement for its proprietary imaging software -- two British Academy (BAFTA) awards, and an armload of Clio, AICP and Cannes Lion Awards for such clients as Budweiser and Nike. Mr. Call also oversees the formation of all strategic partnering initiatives within Digital Domain, and was instrumental in establishing the foundation for Digital Domain's move into feature film development and production.

Before joining Digital Domain, Mr. Call was an attorney with Melveny & Myers, where he represented Digital Domain in connection with the negotiation of a strategic investment by Cox Enterprises. Mr. Call holds a bachelors degree in Electrical Engineering and a masters degree in Computer Science from Stanford University. He also earned his Juris Doctorate degree from Stanford University Law School.


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