AUDIO HIGHWAY ENTERS STRATEGIC ALLIANCE WITH SYCOM TECHNOLOGIES AND KIA

CUPERTINO, Calif. (September 30, 1996) Audio Highway today announced that it has entered into a strategic alliance with Sycom Technologies of Ewing, N.J., and with them, KIA of South Korea.

Under terms of the agreement signed, Sycom has assisted Audio Highway in the final design of its soon-to-be-released Listen Up Player , a small portable device that delivers personalized audio content to on-the-go consumers. (See Audio Highway's web site at for more details.) Additionally, KIA will manufacture all hardware components of the Listen Up Audio System for Audio Highway's national product test that begins in November and the formal product roll-out beginning in January.

"Given their vast resources, we're extremely pleased to be working with KIA and Sycom," said Nathan Schulhof, Audio Highway president and CEO. "Sycom's strength in the portable audio device market, coupled with KIA's vast resources in the consumer related products market, as well as being a major manufacturer of automobiles, makes this an unbeatable relationship." No financial terms for the two agreements were released. Audio Highway enters strategic alliance with Sycom Technologies and KIA Listen Up to be in 3,000+ stores

Under terms of the agreement, Audio Highway's Listen Up Players will be available through more than 3,000 locations throughout North America. These locations will include consumer electronics stores, computer dealers, office product outlets, specialty retailers and other retail superstores. Audio Highway will also sell its Listen Up Players direct to consumers at the suggested retail price of $299 through its toll free phone number: 1-800-77LISTEN.

"After we begin shipping in January, the Listen Up Player will be available in most consumer electronics or computer stores in the country within five months," Schulhof said. "This is a key element in our plans to bring personalized, mobile audio content to information-hungry, on-the-go consumers."

"Audio Highway has been a great partner to work with," said Michael Lamb, vice president of marketing for Sycom. "Their design of the Listen Up Player is functional yet elegant, and we anticipate it will be extremely successful."

Formed in 1994, Audio Highway is developing audio-on-demand products with a focus on the mobile environment and is partnering with content providers to allow customers to choose, retrieve, store and play back audio content using both Internet and broadband delivery systems. For more information, contact the company at 408-255-5301, or visit its World Wide Web site at http://www.audiohwy.com.

Sycom Technologies is a leader in portable, digital recording audio devices. KIA is a Korean manufacturer of automobiles and consumer-related products.