Yamaha Corporation and Klipsch Audio Technologies Forge Product Development and Sales Alliance

Sales of Klipsch Speakers in Japan Expected to Reach $10 Million (¥1 Billion) in the Mid Term

TOKYO (September 16, 2004) - Klipsch Audio Technologies has named Yamaha Corporation the exclusive distributor of Klipsch brand speakers in Japan and the two companies have entered into a basic agreement regarding the joint development of speakers and home theater systems, and global sales alliance. Yamaha President and Representative Director Shuji Ito and Klipsch Chairman Fred Klipsch made the announcement today at a news conference.

According to company officials, Yamaha will begin selling Klipsch Reference Series home audio speakers, ProMedia® computer and video game sound systems, Klipsch in-wall and in-ceiling architectural speakers, and Klipsch professional cinema systems starting from November of this year. The alliance is expected to generate $10 million (¥1 billion) in the mid term.

Founded in 1946, Klipsch is one of the longest-established North American loudspeaker manufacturers. The company and its employees are committed to developing products that create the most engaging, emotional and dynamic entertainment experiences. Klipsch is the number one speaker brand in the United States with 12.1 percent overall market share (Source: NPD Techworld Jan.-Jun 2004) and an estimated 50 percent share of the professional movie theater market not only in the United States but also in Mexico and other countries in Central America and South America.

"Klipsch and Yamaha share a vision for delivering the widest range of the highest quality audio products," said Chairman and Owner Fred Klipsch. "Our partnership with Yamaha reaches far beyond distribution. Together we will leverage the strengths of both brands to enter new markets and develop new products across multiple categories."

Yamaha is a leading brand in home theater products in Japan and overseas. Through the alliance with Klipsch, Yamaha aims to achieve further growth in its home theater business and expand its AV/IT division to include movie theater speakers as well as in-wall and other speakers that blend into the living space-products not currently offered under the Yamaha brand.

Sales of Klipsch products in Japan will be handled by Yamaha's wholly owned domestic sales subsidiary for AV/IT products-Yamaha Electronics Marketing Corporation (Headquarters: Takanawa, Minato-ku, Tokyo; President: Fumio Nakayama). Yamaha will work to leverage the originality and strength of Klipsch products to grow and expand its home theater business as well as to develop custom installation products that blend into the living environment and the commercial business-use sound system market.

The new alliance between Klipsch and Yamaha includes joint development of speakers and home theater systems for the Japanese market as well as for the global market. Yamaha plans to bundle Klipsch-brand speakers with its A/V receivers for distribution to the global market. Klipsch and Yamaha will also collaborate on sales of both brands to digital movie theater markets worldwide.

About Yamaha Corporation
Yamaha, founded in 1887, is one of the world's leading manufacturers of pianos and other musical instruments. Yamaha has grown through developing a broad spectrum of businesses, including electronic devices and equipment, professional audio equipment, and audiovisual equipment. The Yamaha group now has 89 sales and production subsidiaries in addition to numerous related companies in Japan and has 23,903 employin addition to numerous related companies in Japan and has 23,903 employees.