FREMONT, Calif. - July 27, 1999 - Cirrus Logic Inc. (NASDAQ:CRUS), the world's leading supplier of audio ICs, today announced an acquisition that enriches its portfolio of advanced audio technologies and bolsters its position to be a leading supplier in the rapidly emerging Internet music market. With its acquisition of Colorado-based AudioLogic Inc., Cirrus Logic leapfrogs to pre-eminence in next-generation audio signal processing and amplification.

AudioLogic's intellectual property encompasses the highest performance, all- digital pulse width modulation (PWM) technology for next-generation audio systems, and the world's lowest power digital signal processor (DSP). Developed to meet the extraordinary requirements of hearing aids, and suitable for virtually all audio applications, the AudioLogic technologies deliver 2 to 3 times better power efficiency than alternative power amplifier and DSP methods. Cirrus Logic expects to leverage these new technologies to lead the industry in developing highly integrated, low-power chip solutions for portable devices, such as the MP3-class audio players.

Another application of the AudioLogic technologies is the ubiquitous high- performance audio amplifier - which represents a market opportunity measured in hundreds of millions of dollars in consumer products alone. Beyond significantly expanding the total available market for Cirrus Logic's Crystal® audio brand - the market leader in the $1.6 billion audio IC market according to research firm Forward Concepts-the acquisition adds cutting edge PWM and ultra-low power DSP technologies to existing competencies. Spanning a range of emerging applications such as Internet audio players and DVD systems, the Crystal product line includes high- performance analog-to-digital and digital-to-analog converters (ADCs and DACs), codecs, application-specific DSPs, and embedded software.

"With the AudioLogic acquisition, we are extending our lead in high-performance analog and mixed signal integration for embedded applications, along with enhancing the appeal of our top-selling Crystal audio product line," said David D. French, Cirrus Logic's president and chief executive officer. As an early pioneer of low-power techniques, AudioLogic has built a substantial portfolio of over 20 patents issued or pending.

Given the relentless trend for lower-power ICs, French predicts that digital amplifiers such as the AudioLogic PWM could replace linear amps altogether. "This new digital amplifier technology could cause a veritable revolution in audio system design," said French. "Over the next five years, I expect PWM architectures to emerge as one of the primary standards for audio data conversion."

Hearing Aids Drive Development of Ultra Low Power Technology

Designed specifically for battery-powered hearing aid systems - "a very tough benchmark" according to AudioLogic president and CEO Jason Carlson - AudioLogic's PWM technology promises a revolution in DSP, DAC and digital power amplifier design.

Unlike alternative amplifier approaches, including some of the newest high-profile techniques that still use the more expensive, and less efficient analog technology, PWM is completely digital, yet provides signal quality equal to the best linear amps.

"It's tough to do digital signal processing in hearing aids because they have tiny little batteries that operate at one volt," said AudioLogic founder John Melanson. "It requires very sophisticated signal processing and demands very good sound quality. Having met these standards, we mastered skills that apply to other exciting audio applications."

As a totally digital amplifier, PWM lends itself to system-on-chip integration, and is thus suitable for higher density and smaller geometry semiconductor fabrication processes. This is a key advantage that is expected to hone Cirrus Logic's edge in all the audio market segments the company currently supports-computer, consumer, professional and automotive.

Ubiquitous in Audio Applications

Battery-operated and portable products are obvious beneficiaries of PWM and low-power DSP, whether in portable electronics such as audio headsets and MP3 Internet music players, personal electronics such as CD and mini-disk players, boomboxes, or musical instrument amplification. Further, because of its outstanding power efficiency, PWM technology can also enhance "tethered" audio applications that require a constant power source, such as automotive audio, home theater systems, and large venue installed sound systems. According to Keith Essency, vice president and general manager of Crystal Audio Products Division, digital amplifiers provide the remaining step for transitioning audio from analog to digital technology.

"With digital amplification, I expect the conversion from analog to digital audio will accelerate," said Essency. "Much as audio is distributed and processed today using digital technology, audio will also be amplified digitally. With this acquisition, Cirrus Logic takes the lead in driving this change."

AudioLogic Team Joins Cirrus Logic

Along with expanding Cirrus Logic's intellectual property, the AudioLogic acquisition brings some more of the brightest audio technology visionaries in the world to the company.

All 15 AudioLogic employees will work for Cirrus Logic, including Jason Carlson, AudioLogic's president and CEO, and John Melanson, AudioLogic's founder and technical visionary. Carlson will remain president and CEO of AudioLogic, which will operate as a wholly owned subsidiary reporting to French. AudioLogic will keep its Boulder, Colorado facility, and will expand its operations there into a regional technology center.

Financial Terms

Tuesday, July 27 1999 was the effective date of the acquisition, conducted primarily as an exchange of Cirrus Logic for AudioLogic stock. The price was not disclosed.

About AudioLogic

Founded in 1992, AudioLogic went from concept to product sales in just three years. Distinguished by producing a DSP with the broadest dynamic range performance in the market, the privately held company also developed the unique business strategy of software-configurable hearing aids that revolutionized the hearing aid industry.

AudioLogic entered partnerships with Great Nordic Danavox, and Resound Corporation in 1995. Both companies began shipping hearing aids based on AudioLogic technology in 1998. AudioLogic also has development agreements with Implex GmbH, a German company developing the world's first completely implantable hearing aid; Cochlear Ltd., an Australian company that is the largest world manufacturer of cochlear implants; and with a leading provider in the telephone headset business.

About Cirrus Logic Inc.

Cirrus Logic is a premier supplier of high-performance mixed signal circuits and advanced system-on-a-chip DSP solutions. The company's products, sold under its own name and the Crystal product brand, enable system-level applications in mass storage, audio and precision data conversion. Additional information about Cirrus Logic is available at www.cirrus.com.

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Cirrus Logic is a registered trademark of Cirrus Logic, Inc.

All other product names noted herein may be trademarks of their respective holders.

AUDIOLOGIC PROFILE

John Melanson founded AudioLogic in 1992 with backing from Colorado venture capitalist Carl D. Carman, and went from concept to product sales in just three years. Originally planning to form its own vertical hearing aid company, AudioLogic quickly received international interest.

Distinguished by producing a DSP with the broadest dynamic range performance in the market, AudioLogic also developed the unique business strategy of software- configurable hearing aids that revolutionized the hearing aid industry. Moreover, the business model of a fully upgradable audio DSP, and the longevity implicit in its software configurability can be easily translated into other audio applications.

In the fall of 1995, AudioLogic and Great Nordic Danavox, a world leader in hearing aid production, signed a partnership. A few months later, Resound Corporation of Redwood City, CA joined the original two partners to create a new company to further develop the DSP technology for hearing aid and other applications. By the fall of 1998, both Danavox and Resound were shipping leading edge hearing aids based on AudioLogic technology.

"AudioLogic has proven itself as a technology leader in niche markets. Our next step was to move into the widespread consumer market, into every system with an audio output transducer," said Carlson. "We planned to take the traditional route, getting more VC funding and probably doing an IPO. But in talking to people at Cirrus Logic about strategic partnerships, it quickly became clear that we could both benefit from this big move. Combining both companies' technologies with the Cirrus Logic's sales, marketing, production and distribution channels mean we are ready to move into other markets immediately."

AudioLogic also has development agreements with Implex GmbH, a German company developing the world's first completely implantable hearing aid; Cochlear Ltd., an Australian company that is the largest world manufacturer of cochlear implants; and with a leading provider in the telephone headset business.