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Consumers Nationwide Will be Awed by the Superior Sound Delivered Through This Incredible Technology and the Kenwood A/V Receiver

Circle Surround technology is currently employed in over 3,000 cinemas, and the Kenwood VR-409 is the first receiver targeted to the US market that incorporates SRS Labs Circle Surround 5.1 channel technology as a standard feature. It also boasts 100 watts per channel, Dolby Digital & DTS surround decoding, a KAM-1 amplifier, 20-bit Crystal D/A and A/D converters, and 24-bit Crystal DSP with dual precision bass management. The receiver is easy to set up and use with a Kenwood CD Mega-changer for easy display of CD titles on the unit's FL display.

``This is the first sound enhancement technology we've heard where consumers will be able to immediately recognize the improvement,'' stated Joe Richter, president of Kenwood USA Corporation. ``When the VR-409 is demonstrated, consumers will be absolutely stunned by the enhanced experience they can achieve just by adding our new receiver to their current entertainment system. Our engineers and product planners agree that the VR- 409 is our best effort yet to deliver a home theater product that is a perfect combination of performance, features and price. We thank SRS Labs and Cirrus Logic for working with us to make the VR-409 possible.''

``Kenwood has been a strong supporter of SRS Labs' technology since our company's inception in 1993,'' stated Thomas Yuen, chairman of SRS Labs, Inc. ``Their continued support is something we truly value and we're pleased to have their receiver be first-to-market with our Circle Surround 5.1 technology as a standard feature. Long-term relationships like this one we've forged are a valuable asset in making SRS Labs synonymous with superior sound quality.''

``We're certain Circle Surround will be an extremely successful feature in our 2000 product lineup,'' stated Brian Towne, national product manager for Kenwood USA Corporation. ``The Crystal DSP's ability to provide this advanced surround sound support in firmware has accelerated our time-to-market, enabling the VR-409 to be the first audio system nationwide to offer SRS Labs' remarkable Circle Surround 5.1 technology as a standard feature.''

About Circle Surround 5.1

Circle Surround uses the ambiance and directional information already present in the original media for the multi-dimensional effects and does not require the audio signal to be encoded. Circle Surround adds neither artificial ambiance nor reverberations and requires no delay generators or noise reduction. The fully differentiated rear channels provide rear stereo separation for enhanced spatial perception, a feat unique to this technology. The Circle Surround soundfield generator processes stereo input signals and outputs 5 channels of surround sound. The major functions provide signal processing, control generation, steering, and digital interface for mode control. Whether processing plain stereo or Dolby Digital signals, Circle Surround produces five channels of surround sound that are competitive in impact with 5.1 digital surround - but with the ability to use existing media. Circle Surround can decode any existing media, including CD's, cassette tapes, VHS movies, FM radio and television, and stereo broadcasts. The net result is outstanding 5.1 channel surround sound, from unencoded sources revealing hidden ambiance in all kinds of music and cinematic recordings. The listening experience is greatly enhanced and made more enjoyable.

About Kenwood USA

Founded in 1961, Kenwood USA Corporation is the largest audio specialty company in the United States. Offering more than 250 home, car, and personal audio products, Kenwood is recognized by consumers and the consumer electronics industry for developing products that provide superior sound quality, reliability and value. Kenwood USA Corporation, based in Long Beach, Calif., is the largest subsidiary of Kenwood Corporation. Further information can be obtained by contacting Kenwood USA at PO Box 22745, Long Beach, CA 90801 or visiting their website at http://www.kenwoodusa.com.

About SRS Labs, Inc.

SRS Labs is the world's leading provider of audio and voice enhancement technology solutions. SRS Labs' business consists of licensing audio and voice enhancement technologies to manufacturers of consumer electronics, computer, gaming and telecommunications equipment; the design of custom ASICs (application specific integrated circuits) for consumer electronics, game, telecommunications and personal computer manufacturers; the distribution of components, chips and assembly systems for the China and Hong Kong markets; and the manufacturing and marketing of home theater and game products for the Asian consumer marketplace.

For more information on SRS Labs' technologies, the company's worldwide licensing program or its design and manufacturing capabilities, visit the SRS Labs website at http://www.srslabs.com.

Except for historical information contained herein, the statements of Mr. Yuen in this release includes forward-looking statements and projections (including statements concerning plans and objectives of management for future operations) that are based on management's belief, as well as assumptions made by, and information currently available to, management.

While the Company believes that its expectations are based upon reasonable assumptions, there can be no assurances that the Company's goals will be realized. Numerous factors (including risks and uncertainties) may affect the Company's actual results and may cause results to differ materially from those expressed in forward-looking statements made by or on behalf of the Company. Some of these factors include the acceptance of the Company's Internet strategy, the acceptance of new SRS Labs' products and technologies, the impact of competitive products and pricing, the timely development and release of media content by the Company, general business and economic conditions, especially in Asia, and other risks detailed in the Company's Form 10-K and Form 10-Q statements filed with the SEC.

SRS, VIP, and the SRS symbol are registered trademarks of SRS Labs, Inc. in the United States and selected foreign countries. TruBass, NuVoice, and WOW Voice are trademarks of SRS Labs, Inc. in the United States and selected foreign countries. All other brand names mentioned are trademarks or registered trademarks of their respective holders.

SOURCE: SRS Labs, Inc.