Intel And Discreet Logic Announce Agreement To Develop Visual Effects Product For Merced™ Processor

Discreet Logic to Receive Investment From Intel

SANTA CLARA, Calif. and MONTREAL, Quebec, Canada, March 5, 1998 -- Intel Corporation and Discreet Logic, Inc. (NASDAQ: DSLGF) today announced they have agreed to work together to develop a new high-end special effects product. The product will be used in the creation of feature films, commercials, music videos, and broadcast programming and will run on a family of Intel Architecture 64-bit (IA-64™) processors, the first of which, code-named the Merced™ processor, will be in production in 1999. Discreet Logic is a leading provider of visual effects and editing systems and software used for the creation of moving pictures, from feature films to new media content, including the visual effects in the Academy Award Visual Effects nominee, Titanic.

Under terms of the agreement, Discreet Logic plans to develop new visual effects software for demanding real-time compositing and image processing functions. The software will be designed to run on multiprocessor workstations based on the IA-64 processors and is expected to deliver powerful performance capabilities for the visual effects industry. Intel will provide access to IA-64 technology, aid in optimization of the software, and design components of Merced processor-based workstations to run the software optimally.

In a related agreement, Intel purchased 645,000 newly issued shares of Discreet Logic common stock for a total investment of approximately $13.5 million, representing about 2.2 percent of outstanding Discreet Logic shares.

"The agreement with Intel enhances Discreet Logic's ability to take our visual effects and editing technology into new and larger market segments through the widespread and growing use of Intel-based workstations," said Richard Szalwinski, chairman and CEO of Discreet Logic. "The agreement gives us insight into advanced technology key to designing these new systems for Intel's IA-64 platform. With this relationship, we're advancing our vision of delivering the industry's most advanced open platform digital systems for artists creating moving pictures."

"Our goal is to continue fueling demand in the workstation market segment by developing platforms capable of running the most advanced visual computing applications," said Pat Gelsinger, vice president of Intel's Business Platform Group. "Working with Discreet Logic, a recognized leader in visual effects, will give Intel-based workstation users a powerful system to run the most demanding and powerful applications for creating special effects."

The agreement represents a continuation of Intel's visual computing initiative announced in March 1997, which has resulted in a number of announcements over the last year involving both graphics-oriented hardware products and DCC (digital content creation) software such as special effects.

Discreet Logic already offers several of its products, including its D-VISION™ non-linear editor, its ILLUMINAIRE PAINT™ and COMPOSITION™ software, and its Lightscape™ radiosity rendering system, on Intel 32-bit architecture systems. Discreet Logic's advanced systems span the needs of visual effects artists and editors in the visual content creation industry and Discreet Logic will continue to meet the needs of these users by providing advanced tools on multiple computing platforms.

About the Companies
Discreet Logic develops advanced systems and professional desktop software for creating, editing and compositing imagery for film, video, the Web, HDTV, broadcast and interactive games. The company's products serve three key market segments: visual effects, editing and production, and are used in the creation of imagery for feature films including the box office hit Titanic, as well as Contact, Fifth Element and Academy Award winning Independence Day. Additional information is available at www.discreet.com.

* Other names and brands may be claimed as the property of others.