EXHIBIT 10.5

 

[SRS LABS, INC. LETTERHEAD]

 

November 9, 2004

 

Michael S. Oswald

28072 Camellia Ct.

Laguna Niguel, CA 92677

 

Dear Michael:

 

It is with great pleasure that I invite you to join SRS (•) Labs, Inc. as Vice
President, General Counsel.  This is an extremely important position, as you
will have overall responsibility and authority for all legal matters involving
the Company.  You will provide legal advice and services directly, and will be
responsible for engaging and managing the services of outside counsel as
needed.  Activities include:

 

1.     Corporate, Corporate Governance and Transaction Matters

2.     Contract Management

3.     Intellectual Property

4.     Litigation Management

 

Your position will have a monthly salary of $15,000 ($180,000 annual salary). 
The introductory period for a new SRS employee is 90-days.  Upon completion of
the eligibility requirement, you will be entitled to participate in the SRS
bonus plan on the same terms as other executive personnel.  As an executive you
will also participate in the SRS Executive Bonus Plan,

 

You will be eligible on your first day of employment to enroll in our benefits
plan, which includes medical, dental and vision insurance, for you and your
family, as well as life insurance for yourself in the amount of $50,000. 
Coverage will begin on the first day of the month following your employment.  A
copy of the plan will be provided to you during your first week of employment.

 

As an added incentive, we are pleased to grant you a stock option of 150,000
shares of SRS Labs stock The Board of Directors will set the grant date.  The
Company Stock Option program will govern these stock options and a copy of the
plan will be provided to you.  As an employee of SRS Labs, Inc. you are
considered an “insider”.  As such, you will need to comply with the company’s
blackout rules.

 

You will be eligible to take two weeks vacation each year.  Your vacation
eligibility will begin after the completion of your 90-day introductory period,
when you may take what you have earned.  The Company also offers a total of ten
(10) paid holidays per year.  A copy of the employee handbook is provided to
each employee during the first week of employment.

 

SRS also offers employees the option to participate in an Employer Matching
Contributory 401(k) plan.  You are eligible to participate in this Plan after
completing a 90-day introductory period.  The entry dates of the plan fail on
the first day of the each month.  A copy of the plan will be provided to you
during your first week of employment.

 

Your official employment starting date will be November 17, 2004 and you will be
reporting to Torn Yuen, Chairman and CEO.

 

Any offer of employment will be contingent on the submission of proof of your
eligibility to work in the United States and the signing of the SRS Labs, Inc.
At-Will Employment Agreement and the Confidentiality, Non-Competition, and
Compliance Agreement, copies of which will be provided during your first week of
employment.

 

--------------------------------------------------------------------------------

 

This offer replaces and supersedes any other employment offer, service agreement
and understanding between SRS Labs, Inc. and yourself.  If this offer of
employment letter is not accepted by the close of business on November 23rd,
2004 then it will become null and void.

 

Michael, if this offer meets with your approval, please indicate your acceptance
in the space provided below.  We look forward to having you as part of our team
as we establish SRS (•) as the industry standard in contemporary audio and voice
processing.

 

Sincerely,

 

/S/ THOMAS C.K. YUEN

 

 

Thomas C.K. Yuen

C.E.O.

SRS Labs, Inc.

 

6 month salary continuation in event position is eliminated.  Employee must
complete 90 day introductory period before this is effective.

 

I Accept:

/S/ MICHAEL S. OSWALD

 

12 November 2004

 

 

Name

Date

 

 

--------------------------------------------------------------------------------