ASSIGNMENT AND LICENSE AGREEMENT

         This  ASSIGNMENT AND LICENSE  AGREEMENT is entered into effective as of
July 15___,  1999 (the  "Effective  Date") between  Speaker  Acquisition  Sub, a
Cayman Island  corporation  ("Algo Sub"), and a wholly-owned  subsidiary of Algo
Technology,  Inc., a California  corporation  ("Algo");  Aura  Systems,  Inc., a
Delaware corporation ("Parent") and its wholly-owned subsidiary AuraSound, Inc.,
also a Delaware corporation ("Seller").

                                                     RECITALS

         A. Algo,  Algo Sub,  Parent,  and Seller  intend to enter into an Asset
Purchase  Agreement (the "Asset  Purchase  Agreement")  pursuant to which Seller
agrees to sell to Algo Sub and  Algo,  and Algo Sub and Algo  agree to  purchase
from Seller, all of its assets and certain specific liabilities.

         B.  Parent  and  Seller  wish to  assign to Algo Sub  certain  Specific
Trademark  Rights  and grant to Algo Sub (i) a license  to certain of Parent and
Seller's  Speaker  Technology  for use in all  fields;  (ii) a license to all of
Parent and Seller's Intellectual Property Rights for use in the Specific Fields;
and (iii) an option to acquire all right, title and interest to certain Specific
Patent Rights.

         C. Parent and Seller wish to grant to Algo Sub the  licenses and option
described  above,  and Algo Sub  wishes to  acquire  from  Parent and Seller the
licenses and option  described  above, all on the terms and conditions set forth
in this Agreement.

         Now, therefore, the parties agree as follows:

                                    AGREEMENT

II.      DEFINITIONS.  As used in this Agreement:

(a)  "Encumbrance"  means any lien,  pledge,  hypothecation,  charge,  mortgage,
security  interest,  encumbrance,  equity,  trust,  equitable  interest,  claim,
preference,  right  of  possession,   lease,  tenancy,  license,   encroachment,
covenant,  infringement,  interference,  order,  proxy,  option,  right of first
refusal,   preemptive  right,  community  property  interest,   legend,  defect,
impediment,  exception,  reservation,  limitation,  impairment,  imperfection of
title,  condition or restriction of any nature (including any restriction on the
transfer of any asset, any restriction on the receipt of any income derived from
any asset,  any  restriction on the use of any asset and any  restriction on the
possession,  exercise or transfer of any other  attribute  of  ownership  of any
asset).

(b) "Intellectual  Property Rights" means all (a) Patent Rights, (b) copyrights,
mask work rights, and other rights associated with works of authorship  embodied
or represented in such  technology,  (c) trade secret rights in such technology,
(d) all trademarks, trade dress, and other identifying marks and (e) other forms
of intellectual or industrial property rights and proprietary rights of any kind
or nature applicable to such technology,  including but not limited to know-how,
processes,  copyright,  software  programs,  software source documents,  models,
sketches,  drawings,  works of authorship,  and formulae, in each case under the
laws of any  jurisdiction  in the  universe,  including  rights  under  and with
respect to all applications, registrations, extensions, renewals, continuations,
combinations, divisions, and reissues of the foregoing if applicable.

         A list of all trademarks owned by Parent and/or Seller that are subject
to the  licenses  and  assignments  of this  Agreement,  whether  registered  or
unregistered, is attached hereto as Schedule B.

(c)  "Licensed  Parent/Seller  Technology"  means  all of  Parent  and  Seller's
Intellectual  Property Rights,  and any goods and/or services  incorporating the
Licensed  Parent/Seller  Technology,  but not including  the Specific  Trademark
Rights assigned to Algo Sub pursuant to this Agreement.

(d)      "Option" means the option described in Section IX.

(e)  "Patent  Rights"  means  all  the  patents  and  patent   applications  and
docketed/identified  inventions  (as of the  effective  date) of  Parent  and/or
Seller (including the unfiled patent  application titled "Radial Magnet Speaker"
and having docket number 99-14),  any "Patent  Rights" means all the patents and
patent  applications  of  Parent,  any  reissue,  re-examination,   renewal,  or
extension thereof and any patent  applications  deriving from the parent case of
such patents, and all provisionals,  substitutions,  divisionals, continuations,
and continuations-in-part of the foregoing; and any patent corresponding to such
patents,  any reissue,  re-examination,  renewal,  or extension  thereof and any
patent  applications  deriving  from the parent  case of such  patents,  and all
provisionals,      substitutions,      divisionals,      continuations,      and
continuations-in-part  of the foregoing,  including all foreign counterparts and
cases claiming priority.

(f)  "Trademark  Rights"  means all  trademarks  of Parent and Seller  listed in
Schedule B, including foreign counterparts and/or trademarks.

(g) "Speaker Technology" means all of Parent and Seller's  Intellectual Property
Rights directly or indirectly  related to the business of Seller,  and any goods
and/or services incorporating the Speaker Technology.

     (h) "Specific  Fields" means the fields of toys,  sound, and  entertainment
     applications.

(i) "Specific Patent Rights" means those Patent Rights listed on Schedule A.

(j)  "Specific  Trademark  Rights"  means all  Trademark  Rights  designated  in
Schedule  B, along with the  goodwill  of the  business of the Parent and Seller
related to those marks, as those which are assigned to Algo Sub pursuant to this
Agreement.

III.     ASSIGNMENT OF SPECIFIC TRADEMARKS

         Parent and Seller hereby assign to Algo Sub all right, title, goodwill,
and interest to the  Specific  Trademark  Rights.  To that end Parent and Seller
will  execute,  verify and deliver  such  documents  and perform such other acts
(including  appearances  as a witness),  including  the document in the form set
forth in Exhibit B, or as Algo Sub may otherwise  reasonably  request for use in
applying for, obtaining, perfecting,  evidencing,  sustaining and enforcing such
Specific  Trademark Rights and the assignment thereof throughout the world. Algo
Sub shall reimburse Parent for its reasonable  expenses  incurred to comply with
this provision.

IV.      LICENSE IN THE SPECIFIC FIELDS

         Except for those trademarks addressed in paragraph VI below, Parent and
Seller  hereby  grant  to Algo Sub a  non-exclusive,  worldwide,  perpetual  and
irrevocable,  fully-paid and royalty-free, license (with the right to sublicense
through  one or more tiers of  sublicensees  but only in  conjunction  with Algo
Sub's  sublicensing of the Specific Patent Rights),  for any purpose  whatsoever
(e.g.,  to use,  sell,  display,  offer  for  sale,  make,  have  made,  import,
reproduce,  distribute,  modify,  etc.) under all of the Licensed  Parent/Seller
Technology in connection with any activity in the Specific Fields.

V.       LICENSE REGARDING SPEAKER TECHNOLOGY

         Except for those trademarks addressed in paragraph VI below, Parent and
Seller  hereby  grant  to Algo Sub a  non-exclusive,  worldwide,  perpetual  and
irrevocable,  fully-paid and royalty-free, license (with the right to sublicense
through  one or more tiers of  sublicensees  but only in  conjunction  with Algo
Sub's  sublicensing of the Specific Patent Rights),  for any purpose  whatsoever
(e.g.,  to use,  sell,  display,  offer  for  sale,  make,  have  made,  import,
reproduce, distribute, modify, etc.) under all of the Speaker Technology.

VI.      TRADEMARK LICENSE AND OBLIGATIONS.

         With respect to the  trademarks  of Schedule B that are not included in
the  Specific  Trademark  Rights,  Parent and Seller  hereby grant to Algo Sub a
non-exclusive  (subject  to  the  exception  below),  worldwide,  perpetual  and
irrevocable,  fully-paid  and  royalty-free,  license to use the  Trademarks  in
connection  with any  activity  in the  Specific  Fields and any  activity  with
respect to the Speaker Technology. In addition, Algo Sub grants Parent the right
to inspect  the  products  for which the  Trademarks  of Schedule B that are not
included  in the  Specific  Trademark  Rights are used and  ensure  commercially
acceptable  quality.  In the current form, the products of Seller are considered
to be of  commercially  acceptable  quality.  If  Parent  believes  that  future
products are not of commercially acceptable quality, Parent will notify Algo Sub
in writing,  and Algo Sub will have the full  opportunity for cure, and Algo Sub
will have the right to continue its  business  without  interference  until such
time that the quality meets the reasonable  quality  standards of Parent. In the
event that no agreement is reached, the Parties shall enter mediation until cure
is sustained.

         Parent  and Algo Sub agree that they are  obligated  to work to prevent
confusion of the Trademarks of this agreement. In addition, Parent hereby agrees
that  Parent  will not  license  or assign  to any  other  party in the field of
Speaker  Technology  the  Trademarks  of  Schedule  B that  are not  part of the
Specific Trademark Rights without prior written consent of Algo Sub which may be
withheld for any reason

VII.     TRANSFER OF MATERIAL INFORMATION.

         Promptly  (and in any event no later than  ninety  (90) days) after the
Effective  Date,  Parent or Seller  will  cause to be  provided  to Algo Sub all
materials and information relating to the Speaker Technology, and take all steps
reasonably  requested  in an effort to enable  Algo Sub to exploit  the  Speaker
Technology.  Parent or Seller will deliver these  materials and  information  to
Algo Sub in accordance with Algo Sub's instructions.

VIII.    ASSIGNMENT AND LICENSE FEES.

         As full  consideration  for the  assignment  of the Specific  Trademark
Rights, the Option (see paragraph IX below) and the granting of the licenses set
forth  above,  Algo Sub agrees to pay Parent the sum of One Million Five Hundred
Thousand  U.S.  Dollars  ($1,500,000).  Subject to Section XIV, said license fee
shall be payable by Algo Sub to Parent as follows:

(a) at the  Closing,  Algo shall pay to Parent a total of $500,000 in cash or by
cancellation of any outstanding promissory notes due Algo from Parent;

(b) on each of the first two (2) monthly anniversaries of the Closing Date,
     Algo shall pay to the Parent, in cash, the sum of $250,000;

(c) subject to Section  XIV, on each of the third (3rd)  through  seventh  (7th)
monthly  anniversaries  of the Closing  Date,  Algo shall pay to the Parent,  in
cash, the sum of $100,000;

(d) subject to Section XIV, on each annual anniversary of the Closing Date until
such  time as the  payment  obligations  of  Sections  57(b)  and (c) have  been
completed,  Algo shall pay to the Parent, in cash,  interest that has accrued on
amounts unpaid under Sections 75(b) and (c). Interest shall accrue commencing on
the Closing Date at the rate of eight percent (8%) per annum.

IX.      OPTION.

(e) For a period of  thirty-six  months  (36) months  from the  Effective  Date,
Parent  further  grants to Algo Sub the  irrevocable  option (the  "Option")  to
acquire all right, title and interest in the Specific Patent Rights.

(f) During the  thirty-six  month period  following the Effective  Date,  Parent
shall not license,  exclusively,  non-exclusively,  or otherwise encumber in any
manner,  any of the Specific  Patent Rights to any third party without the prior
written  consent of Algo Sub.  Should  Algo Sub fail to  exercise  the Option to
acquire the Specific  Patent Rights prior to  expiration  of the option  period,
nothing herein shall be construed to prevent Parent from subsequently licensing,
on a non-exclusive  basis,  any invention  covered by the Specific Patent Rights
hereunder to any other for the purpose of practicing any such invention.  In the
event Algo Sub elects  not to  exercise  the  Option,  Algo Sub's  non-exclusive
license shall continue on the terms set forth herein without modification.

(g) Algo may exercise the Option at any time prior to the third year anniversary
of the  Effective  Date by  providing  Parent  written  notice of its  desire to
exercise such Option. As full consideration for the exercise of the Option, Algo
shall pay to Parent the sum of One Million Two Hundred  Fifty  Thousand  Dollars
($1,250,000)  payable  as  follows:  (i) an initial  payment of Eighty  Thousand
Dollars  ($80,000) upon the filing of the Patent  Assignments (as defined below)
with the United States  Patent and Trademark  Office and (ii) subject to Section
XIV, eighteen monthly payments of Sixty Five Thousand Dollars  ($65,000).  After
Parent's receipt of the written notice and initial payment,  Parent shall assist
Algo Sub in every  proper  way to  obtain,  and from  time to time  enforce  the
Specific  Patent  Rights  in any and all  countries.  To that  end,  Parent  has
executed the patent  assignment,  in  substantially  the form attached hereto as
Exhibit A (the "Patent  Assignment"),  which Patent  Assignment  will be held in
trust by Blakely,  Sokoloff,  Taylor,  and Zafman and filed only  following  the
written  notice and  initial  payment  referred to above.  Parent will  execute,
verify and deliver such other  documents and perform such other acts  (including
appearances as a witness) as Algo Sub may reasonably request for use in applying
for, obtaining, perfecting,  evidencing,  sustaining and enforcing such Specific
Patent Rights and the assignment  thereof.  Algo Sub shall reimburse  Parent for
its reasonable expenses incurred to comply with this provision.

(h) Parent has executed the attached documents in Exhibit C for filing as public
records to put third parties on notice of this Option.

X.       PATENT PROSECUTION AND MAINTENANCE

         Parent shall  prosecute and maintain  during the term of this Agreement
the Patent  Rights (but not  including  the  Specific  Patent  Rights  following
exercise of the Option). The application filings,  prosecution,  maintenance and
payment of all fees and expenses,  including legal fees, relating to such Patent
Rights  shall be the  responsibility  of  Parent;  provided,  however,  that the
foregoing shall become the  responsibility  of Algo Sub upon the exercise of the
Option with respect to the Specific Patent Rights.  Should Algo Sub determine or
otherwise  become aware of the lapse or anticipated  lapse of the maintenance of
any patent or patent  applications  within the Patent Rights, Algo Sub may elect
to prosecute, maintain, or extend such patent or patent application, as the case
may be, at Algo Sub's  expense and such  expenses  shall be offset,  at Algo and
Algo Sub's  discretion,  (i) from amounts otherwise payable to Parent under this
Agreement,  (ii)  from  amounts  payable  to Parent  under  the  Asset  Purchase
Agreement,  or (iii) from any other amounts payable to Parent.  If and until the
Option is exercised or expires,  Parent will provide to Algo Sub both  quarterly
status  reports  regarding the Specific  Patent Rights and written notice before
any of the Specific Patent Rights are abandoned.

XI.      ENFORCEMENT OF RIGHTS IN THE LICENSED PARENT/SELLER TECHNOLOGY

(i) Filing of Claims.  Parent will have the right,  but not the  obligation,  to
enforce the Patent Rights,  including the Specific  Patent Rights (prior to such
time as Algo Sub exercises the Option).  Algo Sub will cooperate with Parent, at
Parent's  reasonable  request,  in connection with any claim, suit, or action (a
"Claim")  filed by Parent against any such  infringer.  Each party will promptly
notify  the other in  writing  upon  becoming  aware of any  known or  suspected
infringement of such patents; such notice will include the identity of the party
or parties  known or suspected to have  infringed  the patents and any available
information  that is relevant  to such  infringement.  If Parent  files a Claim,
Parent  will  diligently  prosecute  the  Claim  until a  final,  non-appealable
judgment  has been  rendered or the Claim has been  settled;  if Parent fails to
prosecute the Claim  diligently,  Algo Sub may assume control of the prosecution
of the Claim.  Algo Sub's right to assume control of the  prosecution of a Claim
will be Algo Sub's sole  remedy for any  failure by Parent to  prosecute a Claim
diligently.  If Parent fails to file a Claim within  twenty-one  (21) days after
receipt of such notice from Algo Sub, or if and when Parent notifies Algo Sub in
writing  that  Parent  has  decided  not to file a Claim  against  any  known or
suspected infringer, Algo Sub will have the right to file a Claim itself. Parent
will cooperate with Algo Sub, at Algo Sub's  reasonable  request,  in connection
with  any  Claim  filed by Algo  Sub.  In no event  will  Parent  settle a Claim
relating to infringement of the Specific Patent Rights without the prior written
approval of Algo Sub.

(j) Costs and Damages. Algo Sub will be responsible for all costs, expenses, and
legal fees  (collectively,  "Costs") incurred by Algo Sub in connection with any
Claim (whether filed by Parent or Algo Sub), and Parent will be responsible  for
all Costs,  incurred by Parent in connection  with any Claim  (whether  filed by
Parent or Algo  Sub).  Algo Sub will be  entitled  to all  damages  awarded as a
result of, or agreed to in a monetary  settlement  of, any Claim  (regardless of
which party files or  prosecutes  the Claim) to the extent that such damages are
attributable  to  infringement  of the Specific  Patent  Rights.  Parent will be
entitled  to all  damages  awarded  as a result  of, or agreed to in a  monetary
settlement  of, any Claim  (regardless  of which party files or  prosecutes  the
Claim) to the extent that such damages are  attributable  to infringement of the
non-Specific Patent Rights. All damages not attributable to infringement will be
shared  between  Algo Sub and Parent as follows:  each party will be entitled to
recover the Costs it incurred in connection  with the Claim in proportion to the
amount of Costs incurred,  respectively, by Algo Sub and Parent (for example, if
Parent incurred $700,000 in Costs and Algo Sub incurred  $300,000,  Parent would
receive 70% of the damages and Algo Sub would receive 30%),  and if and when all
such Costs have been  recovered,  Algo Sub and Parent  will each  receive  fifty
percent (50%) of the remaining amount of damages.

XII. TERM. This Agreement will take effect on the Effective Date and will remain
in effect in perpetuity until and unless either Algo Sub or Parent dissolves and
ceases to conduct  business and there is no  successor to such party's  business
that assumes such  party's  rights and  obligations  under this  Agreement.  All
licenses  granted in this Agreement  will survive in perpetuity  notwithstanding
any termination of this Agreement.

XIII.    REPRESENTATIONS, WARRANTIES, AND COVENANTS.

         Parent represents and warrants that:

(a) it is a corporation  duly organized,  validly  existing and in good standing
under the laws of the State of Delaware.

(b) the  execution,  delivery and  performance  of this Agreement have been duly
authorized by all necessary corporate action on the part of Parent.

(c) it has the  corporate  power and  authority  to  execute  and  deliver  this
Agreement and to perform its obligations under this Agreement.

(d) it is the owner of the entire right, title and interest in and to the Patent
Rights,  that it has the sole right to grant licenses thereunder and that it has
not granted licenses  thereunder to any other entity that would restrict rights,
including the Option, granted hereunder.

(e) it is the  owner of the  entire  right,  title  and  interest  in and to the
Trademark  Rights  listed in  Schedule B, that it has the full and sole right to
assign such  rights and grant  licenses  thereunder  and that it has not granted
licenses  thereunder  to any other  entity that would  restrict  rights  granted
hereunder

(f) all applicable  maintenance  fees  pertaining to the Patent Rights due on or
before the Effective Date have been timely paid.

(g) the  Intellectual  Property Rights are owned by Parent free and clear of any
Encumbrance  as of the date  hereof,  and Parent  shall not create or permit any
Encumbrance  with respect to the Specific Patent Rights or any Encumbrance  with
respect to the Licensed  Parent/Seller  Technology  that would conflict with the
rights granted hereunder.

(h) the  execution and delivery of the  Agreement,  and the  performance  of the
obligations  hereunder,  will  not  contravene,  conflict  with or  result  in a
violation  or breach  of, or result in a default  under,  any  provision  of any
Contract.

                  to the best of its knowledge,  no patent or patent application
within the Patent Rights is the subject of any pending interference, opposition,
cancellation or other protest proceeding. Parent further represents and warrants
to the best of its knowledge on the  Effective  Date, it has not received and is
not aware of any third  party  claims  that the  practice  of the Patent  Rights
infringes any proprietary right of such third party.

                  there are no in-bound  licenses and only one out-bound license
(to  Yoskikazu  Masayoshi,  Sadao  Masayoshi,  Sachie  Masayoshi,  and  Kazauake
Masayoshi  and  pertaining  to the  Linaeum  Loudspeaker  Tweeters,  but not the
intellectual   properties  concerning  or  related  to  neo  radial  technology)
regarding the Speaker Technology.

         Algo Sub represents and warrants that:

(a)  it is a corporation  duly organized,  validly existing and in good standing
     under the laws of the Cayman Islands.

(b) the  execution,  delivery and  performance  of this Agreement have been duly
authorized by all necessary corporate action on the part of Algo Sub.

(c) it has the  corporate  power and  authority  to  execute  and  deliver  this
Agreement and to perform its obligations under this Agreement.

(d) it shall not file the Patent  Assignment  executed  and  delivered by Parent
with the United States Patent and Trademark  Office or otherwise until such time
as  written  notice  has been  given and the  initial  payment  has been made in
accordance with Section IX.

XIV.     INDEMNIFICATION BY PARENT.

(k) Parent shall defend,  hold  harmless and indemnify  each of Algo Sub and its
affiliates, and their directors, officers, employees, and agents ("Indemnitees")
from and against any and all claims,  suits,  losses,  damages,  costs, fees and
expenses  ("Indemnity  Claim(s)") resulting from or arising out of any breach of
any of the  representations,  warranties,  or  covenants  made by Parent in this
Agreement  (regardless  whether or not such Indemnity Claims relate to any third
party claim).

(l) In  addition  to any rights of setoff or other  rights that the Algo or Algo
Sub or any of the other  Indemnitees  may have at common law or otherwise,  Algo
and Algo Sub shall  have the right to  withhold  and  deduct any sum that may be
owed to any Indemnitee under this Section XIV from any amount otherwise  payable
by any Indemnitee,  including  amounts  payable  pursuant to Section VIII(c) and
(d), to Parent.  The withholding and deduction of any such sum shall operate for
all  purposes  as a  complete  discharge  (to the  extent  of  such  sum) of the
obligation to pay the amount from which such sum was withheld and deducted.

         From  time to time,  Algo Sub may give  notice (a  "Notice")  to Parent
specifying  in  reasonable  detail the nature and dollar amount of any Indemnity
Claim it may have  under this  Agreement;  Algo Sub may make more than one claim
with respect to any  underlying  state of facts.  If Parent gives notice to Algo
Sub disputing any Indemnity Claim (a "Counter  Notice") within 30 days following
receipt by Parent of the Notice regarding such Indemnity  Claim,  such Indemnity
Claim shall be resolved as provided  below.  If no Counter Notice is received by
Algo Sub within such 30-day period, then the dollar amount of damages claimed by
Algo Sub as set forth in its Notice shall be deemed  established for purposes of
this Agreement and, at the end of such 30-day period,  Algo or Algo Sub shall be
entitled to withhold and deduct from  payments  owed to Parent the dollar amount
claimed in the Notice.

         If a Counter Notice is given with respect to an Indemnity  Claim,  Algo
or Algo Sub shall  withhold  and deduct from payment owed to Parent with respect
thereto  only (i) upon  the  mutual  agreement  of the  parties  or (ii) a final
non-appealable order of a court of competent  jurisdiction;  provided,  however,
until such Indemnity Claim is resolved  pursuant to (i) or (ii) above,  Algo and
Algo Sub's payment  obligations under Sections 57(c) and (d) shall be suspended.
Algo and Algo Sub's payment  obligations  will only resume upon such time as the
Indemnity Claim is resolved.

XV.      GENERAL

(m)  Further  Actions.  From and after  the  Effective  Date,  each  party  will
cooperate  with the other  parties,  and will execute and deliver such documents
and take such other actions as another  party may  reasonably  request,  for the
purpose of giving effect to the licenses granted in this Agreement.

(n)  Notices.  Any notice or other  communication  required or  permitted  to be
delivered  to any party  under this  Agreement  must be in  writing  and will be
deemed properly delivered, given and received (a) when delivered by hand, or (b)
two business days after delivered by courier or express  delivery  service or by
facsimile to the address or facsimile  number set forth beneath the name of such
party below (or to such other address or facsimile number as such party may have
specified in a written notice to the other parties):

         if to Parent or Seller     :                if to Algo Sub or Algo:

         c/o Aura Systems, Inc.               c/o Algo Technology, Inc.
         2335 Alaska Avenue                            47338 Fremont Blvd.
         El Segundo, CA  90245                Fremont, CA  94538
         Attention: Zvi Harry Kurtsman, CEO       Attention: Arthur Liu, CEO
         Facsimile: (310) 643-7585            Facsimile: (510) 770-3622

                                                     with a copy to:

                                                     Cooley Godward LLP
                                                     3000 El Camino Real
                                                     Five Palo Alto Square
                                                     Palo Alto, CA  94306-2155
                                                     Attention: David T. Emerson
                                                     Facsimile: (650) 857-0663


(o) Governing Law; Venue.  This Agreement will be construed in accordance  with,
and governed in all respects  by, the internal  laws of the State of  California
(without giving effect to principles of conflicts of laws).  Any legal action or
other legal  proceeding  relating to this  Agreement or the  enforcement  of any
provision of this  Agreement may be brought or otherwise  commenced in any state
or federal court located in the County of Santa Clara, California. Each party to
this  Agreement:  (i)  expressly  and  irrevocably  consents  and submits to the
jurisdiction  of each  state and  federal  court  located in the County of Santa
Clara,  California (and each appellate court located in the State of California)
in connection  with any such legal  proceeding;  (ii) agrees that each state and
federal court located in the County of Santa Clara, California will be deemed to
be a convenient  forum;  and (iii) agrees not to assert (by way of motion,  as a
defense or otherwise),  in any such legal  proceeding  commenced in any state or
federal court located in the County of Santa Clara,  California,  any claim that
such party is not subject  personally to the  jurisdiction  of such court,  that
such legal proceeding has been brought in an inconvenient  forum, that the venue
of such  proceeding is improper or that this  Agreement or the subject matter of
this Agreement may not be enforced in or by such court.

(p) Assignment.  Algo Sub may freely assign any or all of the rights that it has
under this Agreement  (including  its rights under the licenses and  sublicenses
granted to it herein), in whole or in part, to any other party without obtaining
the consent or approval of the other parties to this Agreement.  Parent will not
be  permitted  to assign or  transfer  any of the rights  that it has under this
Agreement or delegate any of its obligations  under this Agreement  without Algo
Sub's  prior  written  consent  not to be  unreasonably  withheld.  None  of the
provisions  of this  Agreement  is intended to provide any rights or remedies to
any third party.  This  Agreement will be binding upon each party hereto and its
successors and assigns (if any).

     (q) Cumulative Remedies. The rights and remedies of the parties hereto will
     be cumulative (and not
alternative).

(r) Waiver.  No failure on the part of any party to exercise  any power,  right,
privilege or remedy under this Agreement,  and no delay on the part of any party
in exercising any power, right,  privilege or remedy under this Agreement,  will
operate as a waiver of such power, right,  privilege or remedy; and no single or
partial exercise of any such power, right, privilege or remedy will preclude any
other or further  exercise  thereof or of any other power,  right,  privilege or
remedy.  No party  will be deemed to have  waived  any claim  arising  from this
Agreement, or any power, right, privilege or remedy under this Agreement, unless
the waiver of such claim,  power,  right,  privilege or remedy is expressly  set
forth in a written  instrument  duly  executed  and  delivered on behalf of such
party;  and any such waiver will not be  applicable or have any effect except in
the specific instance in which it is given.

(s)  Amendment.  This  Agreement  may  not  be  amended,  modified,  altered  or
supplemented  other  than by means of a written  instrument  duly  executed  and
delivered  on behalf of the  parties  sought to be bound by any such  amendment,
modification, alteration or supplement.

(t) Severability.  If any provision of this Agreement, or the application of any
such  provision  to any  person or set of  circumstances,  is  determined  to be
invalid,  unlawful,  void or unenforceable to any extent,  the remainder of this
Agreement,  and the  application of such  provision to persons or  circumstances
other than those as to which it is determined to be invalid,  unlawful,  void or
unenforceable,  will not be impaired or otherwise affected, and will continue to
be valid and enforceable to the fullest extent permitted by law.

(u) Independent Contractors. Algo Sub and Parent are independent contractors and
neither  will have the  authority  to act on  behalf of the other or create  any
binding  obligation  for the other.  This Agreement is not intended to establish
any partnership,  joint venture,  employment, or other relationship between Algo
Sub and Parent except that of independent contractors.

(v) Construction.  The section headings in this Agreement are for convenience of
reference only, will not be deemed to be a part of this Agreement,  and will not
be referred to in connection  with the  construction or  interpretation  of this
Agreement.  Any rule of  construction  to the effect that  ambiguities are to be
resolved  against the drafting party will not be applied in the  construction or
interpretation of this Agreement. As used in this Agreement, the words "include"
and  "including,"  and  variations  thereof,  will not be  deemed to be terms of
limitation,  but  rather  will be deemed to be  followed  by the words  "without
limitation."  Except as otherwise  expressly  indicated,  all references in this
Agreement to "Sections" and "Exhibits" are intended to refer to Sections of this
Agreement and Exhibits to this Agreement.

(w) Counterparts.  This Agreement may be executed in several counterparts,  each
of which will constitute an original and all of which, when taken together, will
constitute one agreement.

(x) Entire Agreement.  This Agreement,  along with the Asset Purchase Agreement,
and  the  Exhibits  and  Schedules  attached  hereto,   sets  forth  the  entire
understanding  of  the  parties  relating  to  the  subject  matter  hereof  and
supersedes all prior agreements and understandings  between the parties relating
to the subject matter hereof.




<PAGE>



         IN WITNESS  WHEREOF,  the  parties  have caused  this  Agreement  to be
executed and delivered as of the Effective Date.

SPEAKER ACQUISITION SUB                     AURA SYSTEMS, INC.


By: _______________________________         By: ______________________________

Name: ____________________________          Name: ____________________________

Title: _____________________________       Title: _____________________________


ALGO TECHNOLOGY, INC.                       AURASOUND, INC.


By:                                             By:

Name:                                          Name:

Title:                                        Title:



<PAGE>



<TABLE>
<CAPTION>
                                                    SCHEDULE A

                                              SPECIFIC PATENT RIGHTS
<S>         <C>                                                     <C>          <C>
Docket #    Title                                                   US    Serial US   Patent
                                                                    Number       Number
                                                                                 (if issued)
91-11       Voice Coil Actuator I                                   07/740,068   5,321,762


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

92-14       Voice Coil Actuator II                                  07/925,085
cip of
91-11


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

93-05D      Teardrop Speaker Motor Case                             29/005,828   D364,167


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

93-07       Voice Coil Excursion and Amplitude Gain Control Device  08/062,807   5,418,860


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

93-21       Electromagnetic Transducer                              08/086,622   5,424,592



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

93-25       Apparatus and Method for Assembly                       08/140,231   5,598,625
cip of      of Radial Magnet Voice Coil
91-11       Actuators


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

93-46-D     Amplifier Housing                                       29/018,102   D364,162


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

93-49       Axially Focused Radial Magnet                           08/285,405   5,539,262
             Voice Coil Actuator



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

94-08       Voice Coil Actuator                                     08/286,597   5,434,458
(FWC of
 92-14)


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

95-01       Electromagnetic Transducer                              08/374,939   5,624,155
(Div of
  93-21)


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

95-08       Voice Coil Actuator                                     08/476,491   5,536,984
(Div of
94-08)


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

95-10       Dual Axial Magnet Speaker                               08/491,250


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

95-19D      Angled Speaker Enclosure                                29/046,225   D394,063


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

95-20       Piezo Speaker                                           08/577,297   5,736,808


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

95-21       Polygon Magnet Structure for                            08/576,801   5,786,741
            Voice Coil Actuator


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

97-03D      Speaker Basket                                          27/056,795



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

97-14       Audio Transducer With Controlled                        07/154,945   4,903,308
            Flexibility Diaphragm


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

97-15       Audio Transducer with Controlled                        07/556,776   4,584,439
            Flexibility Diaphragm


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

97-16       Audio Transducer with Controlled                        07/436,914   5,198,624
            Flexibility Diaphragm


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

97-17       Centering Device for Speaker                            07/499,492   5,127,060
            Diaphragm


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

97-19       Audio Transducer Improvements                           07/708,924   5,249,237


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

97-20       Audio Transducer Improvements                           07/730,172   5,230,021


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

97-21       Audio Transducer Improvements                           07/882,144   5,450,497


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

97-26       Audio Transducer having Piezoelectric Device            08/236,209   5,727,076


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

97-27       Resonance Damper for Piezoelectric                      08/286,625   5,652,801
            Transducer

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

97-28       Single   Magnet   Audio   Transducer   and   Method  of 08/272,295   5,604,815
            Manufacturing

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

97-29       Audio Transducer with Etched                            08/322,108   5,446,797
            Voice Coil


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

97-30       Audio Transducer with Flexible Foam Enclosure           08/384,380   5,570,429


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

98-01D      Speaker Basket                                          29/069,434   D396,723
Div      of
97-03D


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

99-02       Piezoelectric Speaker                                   09/056,394
(CIP of
95-20)

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

99-06D      Tiltable Loudspeaker Enclosure                          29/090,939

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

99-07D      Tiltable Loudspeaker Enclosure (woofer)                 29/090,938

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

99-14       Radial Magnet Speaker

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

</TABLE>



<PAGE>



                                                    SCHEDULE B

                                                 TRADEMARKS RIGHTS

The Specific Trademark Rights are denoted with an *.
Those items  marked with NL (Not  Licensed)  are not to be included in Trademark
Rights. The Trademark Rights are denoted with an **.


<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------
<S>          <C>   <C>                                                   <C>        <C>

Docket             Mark                                                 Serial       Reg.
Number                                                                  Number       Number

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

TM92-01      NL    AuraFlux                                             74/322,660   293732


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

TM92-02      *     AURASOUND                                            74/313,418


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

TM92-03      NL    AuraScope                                            74/134,961


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

TM92-04      NL    AuraScope                                            74/134,960


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

TM93-01      *     Aurasound (w/logo)                                   74/349,974


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

TM93-02      **    Aura                                                 74/369,064   2,196,818


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

TM93-03      NL    Write your Congressman with a Phone Call             74/360,524


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

TM93-04      NL    21st Century Technologies                            74/367,568


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

TM93-05      *     Musical Chairs                                       74/385,179


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

TM93-06      *     Vibrasonics                                          74/388,369


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

TM93-07      NL    Power Tower                                          74/394,182


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

TM93-08      **    Radial Flux                                          74/408,601


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

TM93-09      **    Radial Mag                                           74/408,180


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

TM93-10      **    Radial Pole                                          74/408,209


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

TM93-11      *     Radial Neo                                           74/408,445


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

TM93-12      **    Radial Power                                         74/408,205


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

TM93-13      **    Radial Ring                                          74/408,664


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

TM93-14      **    Radial Line                                          74/408,207


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

TM93-15      NL    Linear Mag                                           74/408,619


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

TM93-16      NL    Linear Flux                                          74/408,231


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

TM93-17      NL    Linear Ring                                          74/408,211


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

TM93-18      **    Neo Flux                                             74/408,448


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

TM93-19      **    Neo Power                                            74/408,208


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

TM93-20      ***   Neo Ring                                             74/408,671


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

TM93-21      **    Neo Mag                                              74,408,447


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

TM93-22      NL    Linear Gap                                           74/408,446


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

TM93-23      **    Radial Gap                                           74/408,672


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

TM93-24      NL    High Gap                                             74/408,244


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

TM93-25      NL    Tall Gap                                             74/408,003


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

TM93-26      **    Neo Gap                                              74/408,206


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

TM93-27      **    Radial Stroke                                        74/408,178


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

TM93-28      NL    Linear Stroke                                        74/408,243


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

TM93-29      **    Neo Stroke                                           74/408,179

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

TM93-30      NL    High Stroke                                          74/408,232

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

TM93-31      *     Pillow Sonics                                        74/408,242


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

TM93-32      *     Theatre Sonics                                       74/408,210


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

TM93-33      *     Aura Sonics                                          74/410,206

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

TM 93-34     *     Auto Sonics                                          74/417,408


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

TM 93-35     *     Interactor                                           74/425,395   1,920,753


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

TM 93-36     NL    Technologies of the 21st Century                     74/431,065

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

TM 93-37     NL    Thunderbolt                                          74/437,049


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

TM 93-38     NL    RAINBOW (block letters)                              74/439,107   1,970,336


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

TM 93-39     NL    Rainbow (w/logo)                                     74/446,644   2,044,009


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

TM 93-40     NL    Rainbow (stylized)                                   74/446,645   2,040,868


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

TM-93-41     NL    Aurascope                                            74/466,053


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

TM 93-42     **    Aura (stylized)                                      74/472,095   1,991,593


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

TM 93-43     *     Interactor (stylized)                                74/472,097


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

TM 94-01     *     Virtual Reality Gamewear


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

TM 94-02     *     Soundplay                                            74/528,416


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

TM 94-03.    *     Mag Force                                            74/528,276

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

TM 94-04     NL    Newcom (stylized)                                    75/033,934   2,030,034


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

TM 94-05     NL    Newtalk                                              74/618,797


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

TM95-01      **    Auraphile                                            74/639,340


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

TM95-02      *     Bass Shaker                                          74/679,644   2,072,412


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

TM95-03      *     NRT                                                  74/706,754   2,144,980


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

TM95-04      *     Neo-Radial Technology                                74/706,753   2,067,789


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

TM95-05      *     Neo-Radial                                           74/720,723   2,063,972


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

TM95-06      NL    Net Talk                                             75/021,446


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

TM95-07      NL    Net Fax                                              75/021,447


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

TM95-08      NL    NewCom (Block Letters)                               75/033,935   2,030,035

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

TM96-01      *     Mobile Reference (Stylized)                          75/123,840


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

TM96-02      *     Neo-Radial Technology (Stylized)                     75/123,841   2,111,403


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

TM96-03      *     Mobile Reference                                     75/131,644



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

TM96-04      NL    Aurapower                                            75/141,344


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

TM96-05      NL    Auragen                                              75/141,345   443325


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

TM97-01      *     Aspect                                               75/225,690   2,128,907

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

TM97-02      *     Force                                                75/225,287


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

TM97-03      NL    Radiance  (NEVER FILED)


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

TM97-04      NL    EVA                                                  75/225,341   2,181,910


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

TM97-05      NL    FAS                                                  75/225,289


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

TM97-06      NL    Ferrodisk                                            75/225,288


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

TM97-07      NL    FAR                                                  75/225,280


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

TM97-08      *     Force 150                                            75/229,617


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

TM97-09      *     Force 250                                            75/229,616


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

TM97-10      *     Force 340                                            75/229,720


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

TM97-11      *     Force 560                                            75/229,719


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

TM97-12      *     Force 400q                                           75/229,718


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

TM97-13      *     Force 42                                             75/225,286


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

TM97-14      *     Force 52                                             75/225,285


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

TM97-15      *     Force 62                                             75/225,284


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

TM97-16      *     Force 426                                            75/225,283


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

TM97-17      *     Force 527                                            75/225,282


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

TM97-18      *     Force 629                                            75/225,281


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

TM97-19      *     Force 639                                            75/225,295


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

TM97-20      *     Force 10                                             75/225,296


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

TM97-21      *     Force 12                                             75/225,297


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

TM97-22      *     Force 15                                             75/225,298


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

TM97-23      *     Aura Virtual Sound                                   75/235,513


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

TM97-24      *     AVS                                                  75/235,817


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

TM97-25      *     Do More Than Listen                                  75/235,512


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

TM97-26      NL    Auragen of Power                                     75/237,652


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

TM97-27      NL    Atlas Peripherals                                    75/256,929   2,179,587


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

TM97-28      *     MR                                                   75/252,086


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

TM97-29      *     MR 52                                                75/252,087


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

TM97-30      *     MR 62                                                75/252,088   2,170,440

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

TM97-31      *     MR 5.1                                               75/252,089   2,219,543


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

TM97-32      *     MR 6.1                                               75/252,090   2,188,518

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

TM97-33      *     MR 629                                               75/252,091


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

TM97-34      *     MR 1                                                 75/252,085   2,170,439


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

TM98-01      NL    Webpal                                               75/267,533


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

TM98-02      NL    Navpal                                               75/267,532


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

TM98-03      NL    Newpal                                               75/267,531


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

TM98-04      *     Linaeum                                              74/132,488


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

TM98-05      *     Line Source                                          75/291,967


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

TM98-06      *     Force (stylized)                                     75/291,968


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

TM98-07      *     Line Source (design)                                 75/330,407


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

TM98-08      NL    Dash 3D                                              75/376,536
                   (NewCom)

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

TM98-09      NL    Simplified Technology For                            75/382,016
                   All Walks of Life
                   (NewCom)

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

TM98-10      NL    CINEMA II                                            75/425,789
                   (NewCom)

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

TM98-11      NL    EXTREME CINEMA                                       75/425,790
                   (NewCom)

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

TM 98-12     NL    Aura (B&W)


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

TM 98-13     NL    AURAGEN                                              75/977693    2,202,313
(div'l    of
TM96-05)

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

TM 99-01     NL    AMA


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

TM 99-02     NL    AURA (Merchant & Gould)                              75/559,987


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

TM 99-03     NL    RPM                                                  75/579,192


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

TM 99-04     ***   Beyond Red Line                                      75/579,642


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

TM 99-05     NL    The Ultimate Upgrade                                 75/579,641


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

TM 99-06     *     Mobile Reference Platinum                            75/579,640


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

TM 99-07     NL    HOME ACCESS (NewCom)                                 75/584,002


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

TM99-08      NL    Auragen                                              75/594,235
                   Power. On The Go.  (Stylized)

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

TM99-09      NL    The Compatibility Company                            75/607,594

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

TM99-10      NL    Thin Pal

------------------------------------------------------------------------------------------------
</TABLE>




<PAGE>



                                    EXHIBIT A

                                PATENT ASSIGNMENT




<PAGE>



                            FORM OF PATENT ASSIGNMENT

Attorney Docket No:                                                      PATENT


I hereby  certify that this  correspondence  is being  deposited with the United
States Postal Service with sufficient postage as first class mail in an envelope
addressed to the Assistant Commissioner for Patents,  Washington,  D.C. 20231 on
__________________, _____.

                                         By:______________________________
                                            ASSIGNMENT OF PATENT RIGHTS


Aura Systems,  Inc., a corporation  organized and existing under the laws of the
state of Delaware, having a place of business at _______________________________
(hereinafter called "Assignor"), hereby assigns certain patent rights to Speaker
Acquisition  Sub, a  corporation  organized  and existing  under the laws of the
Cayman Islands having a place of business at ___________________________________
(hereinafter called the "Assignee"):

WHEREAS  Assignor  is the owner of the  Letters  Patents  and  Applications
     Listed on Schedule I attached hereto,

AND WHEREAS  Assignor  has agreed with  Assignee  for the  transfer to it of the
whole right,  title and interest in and to said Applications and to said Letters
Patent, and inventions therein,

NOW THIS  ASSIGNMENT  WITNESSETH  that in pursuance of the said agreement and in
consideration  of the sum of One U.S.  Dollar  ($1.00)  and such  other good and
valuable  consideration  paid by  Assignee  to  Assignor  (the  receipt of which
Assignor hereby acknowledges), Assignor, as beneficial owner, hereby assigns and
transfers  to Assignee  said  inventions,  said  Applications  and said  Letters
Patent,  and any and all  Letters  Patent or  Patents  in the  United  States of
America and all foreign countries which may be granted therefor and thereon, and
in and to any and all divisions,  continuations,  and  continuations-in-part  of
said  applications,  or reissues or extensions of said Letters  Patent,  and all
rights under the  International  Convention  for the  Protection  of  Industrial
Property,  and the full exclusive benefits thereof,  and all rights,  privileges
and advantages  appertaining  thereto,  including any and all rights to damages,
profits  or  recoveries  of any  nature for past  infringement  of said  Letters
Patent, and the payment of any and all maintenance fees, taxes, and the like, TO
HOLD the same  unto  and to the use of  Assignee,  its  successors  and  assigns
absolutely during the residue of the respective terms for which the said Letters
Patent  were  granted  and  during  any such  terms,  and for any and all rights
extending from said applications and reissues.

ASSIGNOR  hereby  covenants  that  Assignor  has full right to convey the entire
interest herein being assigned and represents that Assignor has not executed and
will not execute any  agreements  inconsistent  with this  Assignment  or to the
detriment of the patents, applications, and inventions being assigned hereby.

AND for the same consideration, Assignor hereby covenants and agrees to and with
Assignee, its successor,  legal representatives and assigns that, at the time of
execution and delivery of these presents,  Assignor is the sole and lawful owner
of the entire right,  title and interest in and to the said  inventions  and the
application for Letters Patent above-mentioned,  that the same are unencumbered,
and that  assignor  has good and full  right and  lawful  authority  to sell and
convey the same in the manner herein set forth.




<PAGE>



AND for the same consideration, Assignor hereby covenants and agrees to and with
Assignee, its successors,  legal representatives and assigns that Assignor will,
whenever  counsel  of  Assignee,  or  the  counsel  of  its  successors,   legal
representatives and assigns, shall advise that any proceeding in connection with
said inventions,  or that any division,  continuation or continuation-in-part of
any Letters Patent to be obtained  therein,  is lawful and  desirable,  sign all
papers  and  documents,  take all lawful  oaths,  and do all acts  necessary  or
required to be done for the procurement, maintenance, enforcement and defense of
Letters Patent for said inventions,  without charge to Assignor, its successors,
legal  representatives and assigns, but at the cost and expense of the Assignee,
its successors, legal representatives and assigns.

Executed at __________________this __________ day of ______________,19__

                          Assignor:
                          Signature:
                          Printed Name:
                          Title:

State of _____________)
Country of ______________)          SS:
Before me personally appeared said _______________________
And  acknowledged  the  foregoing  instrument  to be his fee act and  deed  this
__________, 1999.


Seal                                                 __________________________

                                                     (Notary Public)




<PAGE>



                                                    SCHEDULE I



Patents:
5,321,762     5,539,262   5,786,741   5,230,021
D364,167      5,434,458   4,903,308   5,450,497
5,418,860     5,624,155   4,584,439   5,727,076
5,424,592     5,536,984   5,198,624   5,652,801
5,598,625     D394,063    5,127,060   5,604,815
D364,162      5,736,808   5,249,237   5,446,797
                                      D396,723
Patent Applications:
08/491,250
27/056,795
09/056,394
29/090,939
29/090,938
--------------




<PAGE>



                                    EXHIBIT B

                              TRADEMARK ASSIGNMENT




<PAGE>



                            ASSIGNMENT OF TRADEMARKS

                  THIS  ASSIGNMENT  OF  TRADEMARKS is made July ___, 1999 by and
between Speaker  Acquisition Sub, a Cayman Island corporation having a principal
place of business  located at  ________________________  ("Algo Sub"),  and Aura
Systems,  Inc., a Delaware corporation having its principal place of business at
2335 Alaska Avenue,  El Segundo,  California  90245 ("Aura  Systems"),  and Aura
Systems' wholly-owned  subsidiary  AuraSound,  Inc., also a Delaware corporation
("Seller").

         WHEREAS,  Algo  Sub,  Aura  Systems,  and  Seller  are  parties  to  an
Assignment   and  License   Agreement  of  even  date   herewith  (the  "License
Agreement"),  under the terms of which Aura  Systems  and  Seller  will sell and
transfer, and Algo Sub will purchase certain trademarks; and

         WHEREAS, Aura Systems and/or Seller are the owner of the trademarks set
forth in Schedule 1 (as well as various  foreign  counterparts  and  trademarks)
hereto (the "Trademarks"); and

         WHEREAS,  pursuant to the License Agreement, Algo Sub desires to obtain
all of Aura  Systems'  and Seller's  right,  title and interest in, to and under
said Trademarks;

         NOW, THEREFORE,  for good and valuable  consideration,  the receipt and
sufficiency  of which is hereby  acknowledged  by Aura Systems and Seller,  Aura
Systems and Seller  hereby sell,  convey,  assign,  transfer and deliver to Algo
Sub,  its  successors  and  assigns,  all of their  right,  title  and  interest
throughout the world in and to the Trademarks, together with the goodwill of the
business symbolized by the Trademarks,  and the registrations thereof,  together
with the right to sue and recover damages for future  infringements  thereof and
to stand in the  place of Aura  Systems  and/or  Seller in all  matters  related
thereto.  Aura  Systems  and  Seller  agree to take such  further  action and to
execute  such  additional  documents  as may be  necessary to perfect Algo Sub's
title in and to the Trademarks.

         IN WITNESS  WHEREOF,  the parties hereto have caused this Assignment of
Trademarks to be executed as of the day and year first written above.

                             SPEAKER ACQUISITION SUB, a Cayman corporation
                             By:  ________________________________
                             Name:_______________________________
                            Title: ________________________________


AURA SYSTEMS, INC., a Delaware corporation AURASOUND, INC., a Delaware Corp.

By: _________________________________     By: ________________________________
Name: _______________________________     Name: _____________________________
Title:__________________________________  Title:_______________________________



<PAGE>



                                  SCHEDULE 1 TO

                            ASSIGNMENT OF TRADEMARKS

                    By Aura Systems, Inc. and AuraSound, Inc.


                                       To


                             Speaker Acquisition Sub



<TABLE>
<CAPTION>

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

Docket             Mark                                                 Serial       Reg.
Number                                                                  Number       Number

------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------
<S>         <C>    <C>                                                  <C>         <C>

TM92-02      *     AURASOUND                                            74/313,418


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

TM93-01      *     Aurasound (w/logo)                                   74/349,974


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

TM93-05      *     Musical Chairs                                       74/385,179


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

TM93-06      *     Vibrasonics                                          74/388,369


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

TM93-08      *     Radial Flux                                          74/408,601


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

TM93-09      *     Radial Mag                                           74/408,180


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

TM93-10      *     Radial Pole                                          74/408,209


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

TM93-11      *     Radial Neo                                           74/408,445


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

TM93-12      *     Radial Power                                         74/408,205


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

TM93-13      *     Radial Ring                                          74/408,664


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

TM93-14      *     Radial Line                                          74/408,207


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

TM93-18      *     Neo Flux                                             74/408,448


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

TM93-19      *     Neo Power                                            74/408,208


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

TM93-20      *     Neo Ring                                             74/408,671


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

TM93-21      *     Neo Mag                                              74,408,447


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

TM93-23      *     Radial Gap                                           74/408,672


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

TM93-26      *     Neo Gap                                              74/408,206


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

TM93-27      *     Radial Stroke                                        74/408,178


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

TM93-29      *     Neo Stroke                                           74/408,179

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

TM93-31      *     Pillow Sonics                                        74/408,242


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

TM93-32      *     Theatre Sonics                                       74/408,210


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

TM93-33      *     Aura Sonics                                          74/410,206

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

TM 93-34     *     Auto Sonics                                          74/417,408


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

TM 93-35     *     Interactor                                           74/425,395   1,920,753


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

TM 93-43     *     Interactor (stylized)                                74/472,097


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

TM 94-01     *     Virtual Reality Gamewear


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

TM 94-02     *     Soundplay                                            74/528,416


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

TM 94-03.    *     Mag Force                                            74/528,276

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

TM95-02      *     Bass Shaker                                          74/679,644   2,072,412


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

TM95-03      *     NRT                                                  74/706,754   2,144,980


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

TM95-04      *     Neo-Radial Technology                                74/706,753   2,067,789


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

TM95-05      *     Neo-Radial                                           74/720,723   2,063,972


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

TM96-01      *     Mobile Reference (Stylized)                          75/123,840


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

TM96-02      *     Neo-Radial Technology (Stylized)                     75/123,841   2,111,403


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

TM96-03      *     Mobile Reference                                     75/131,644



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

TM97-01      *     Aspect                                               75/225,690   2,128,907

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

TM97-02      *     Force                                                75/225,287


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

TM97-08      *     Force 150                                            75/229,617


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

TM97-09      *     Force 250                                            75/229,616


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

TM97-10      *     Force 340                                            75/229,720


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

TM97-11      *     Force 560                                            75/229,719


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

TM97-12      *     Force 400q                                           75/229,718


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

TM97-13      *     Force 42                                             75/225,286


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

TM97-14      *     Force 52                                             75/225,285


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

TM97-15      *     Force 62                                             75/225,284


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

TM97-16      *     Force 426                                            75/225,283


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

TM97-17      *     Force 527                                            75/225,282


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

TM97-18      *     Force 629                                            75/225,281


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

TM97-19      *     Force 639                                            75/225,295


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

TM97-20      *     Force 10                                             75/225,296


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

TM97-21      *     Force 12                                             75/225,297


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

TM97-22      *     Force 15                                             75/225,298


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

TM97-23      *     Aura Virtual Sound                                   75/235,513


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

TM97-24      *     AVS                                                  75/235,817


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

TM97-25      *     Do More Than Listen                                  75/235,512


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

TM97-28      *     MR                                                   75/252,086


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

TM97-29      *     MR 52                                                75/252,087


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

TM97-30      *     MR 62                                                75/252,088   2,170,440

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

TM97-31      *     MR 5.1                                               75/252,089   2,219,543


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

TM97-32      *     MR 6.1                                               75/252,090   2,188,518

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

TM97-33      *     MR 629                                               75/252,091


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

TM97-34      *     MR 1                                                 75/252,085   2,170,439


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

TM98-04      *     Linaeum                                              74/132,488


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

TM98-05      *     Line Source                                          75/291,967


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

TM98-06      *     Force (stylized)                                     75/291,968


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

TM98-07      *     Line Source (design)                                 75/330,407


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

TM 99-04     *     Beyond Red Line                                      75/579,642


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

TM 99-06     *     Mobile Reference Platinum                            75/579,640


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




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

Mark                                                   US Serial    US Reg.
                                                       Number       Number

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

AURASOUND                                              74/313,418


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

Aurasound (w/logo)                                     74/349,974


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

Radial Flux                                            74/408,601


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

Radial Mag                                             74/408,180


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

Radial Pole                                            74/408,209


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

Radial Neo                                             74/408,445


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

Radial Power                                           74/408,205


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

Radial Ring                                            74/408,664


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

Radial Line                                            74/408,207


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

Neo Flux                                               74/408,448

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

Neo Power                                              74/408,208


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

Neo Ring                                               74/408,671


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

Neo Mag                                                74,408,447


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

Radial Gap                                             74/408,672


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

Neo Gap                                                74/408,206


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

Radial Stroke                                          74/408,178


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

Neo Stroke                                             74/408,179

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

Interactor                                             74/425,395   1,920,753


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

Aura (stylized)                                        74/472,095   1,991,593

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

Interactor (stylized)                                  74/472,097


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

Bass Shaker                                            74/679,644   2,072,412

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

NRT                                                    74/706,754   2,144,980


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

Neo-Radial Technology                                  74/706,753   2,067,789


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

Neo-Radial                                             74/720,723   2,063,972


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

Mobile Reference (Stylized)                            75/123,840


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

Neo-Radial Technology (Stylized)                       75/123,841   2,111,403


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

Mobile Reference                                       75/131,644


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

Aspect                                                 75/225,690   2,128,907

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

Aura Virtual Sound                                     75/235,513

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

AVS                                                    75/235,817


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

MR                                                     75/252,086

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

MR 52                                                  75/252,087

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

MR 62                                                  75/252,088   2,170,440

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

MR 5.1                                                 75/252,089   2,219,543


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

MR 6.1                                                 75/252,090   2,188,518

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

MR 629                                                 75/252,091

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

MR 1                                                   75/252,085   2,170,439

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

Linaeum                                                74/132,488


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

Line Source                                            75/291,967

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

Line Source (design)                                   75/330,407

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

Mobile Reference Platinum                              75/579,640


-------------------------------------------------------------------------------
</TABLE>




<PAGE>




                                    EXHIBIT C

                    DOCUMENTS REGARDING OPTION TO BE RECORDED




<PAGE>



                                     OPTION

         This  option  is  entered  into  effective  as of July  ___,  1999 (the
"Effective Date") between Speaker  Acquisition Sub, a Cayman Island  corporation
("Algo  Sub"),  and a  wholly-owned  subsidiary  of  Algo  Technology,  Inc.,  a
California  corporation ("Algo"); and Aura Systems, Inc., a Delaware corporation
("Parent"),  and its wholly-owned  subsidiary  AuraSound,  Inc., also a Delaware
corporation ("Seller").

         (a) For a period of  thirty-six  months (36) months from the  Effective
Date, Parent hereby grants to Algo Sub the irrevocable  option (the "Option") to
acquire all right, title and interest to the US patents listed below (as well as
any foreign counterparts or cases that claim priority from the US patents listed
below):

5,321,762     5,539,262   5,786,741   5,230,021
D364,167      5,434,458   4,903,308   5,450,497
5,418,860     5,624,155   4,584,439   5,727,076
5,424,592     5,536,984   5,198,624   5,652,801
5,598,625     D394,063    5,127,060   5,604,815
D364,162      5,736,808   5,249,237   5,446,797
                                      5,570,429
                                      D396,723

         (b) During the thirty-six  month period  following the Effective  Date,
Parent shall not license, exclusively, non-exclusively, or otherwise encumber in
any  manner,  any of the  above to any third  party  without  the prior  written
consent of Algo Sub. Should Algo Sub fail to exercise the Option, nothing herein
shall  be  construed  to  prevent  Parent  from  subsequently  licensing,  on  s
non-exclusive  basis, any invention  covered by the above hereunder to any other
for the purpose of practicing any such  invention.  In the event Algo Sub elects
not to exercise the Option, Algo Sub's  non-exclusive  license shall continue on
the terms set forth herein without modification.


SPEAKER ACQUISITION SUB                   AURA SYSTEMS, INC.


By: _______________________________       By: ______________________________

Name: ____________________________        Name: ____________________________

Title: _____________________________      Title: _____________________________


ALGO TECHNOLOGY, INC.                                 AURASOUND, INC.

By:                                                   By:

Name:                                                 Name:

Title:                                                Title:



<PAGE>



                                     OPTION

         This  option  is  entered  into  effective  as of July  ___,  1999 (the
"Effective Date") between Speaker  Acquisition Sub, a Cayman Island  corporation
("Algo  Sub"),  and a  wholly-owned  subsidiary  of  Algo  Technology,  Inc.,  a
California  corporation ("Algo"); and Aura Systems, Inc., a Delaware corporation
("Parent"),  and its wholly-owned  subsidiary  AuraSound,  Inc., also a Delaware
corporation ("Seller").

         (a) For a period of  thirty-six  months (36) months from the  Effective
Date, Parent hereby grants to Algo Sub the irrevocable  option (the "Option") to
acquire all right,  title and interest to the US patent application listed below
(as well as any foreign  counterparts  or cases that claim  priority from the US
patent application listed below):

08/491,250

         (b) During the thirty-six  month period  following the Effective  Date,
Parent shall not license, exclusively, non-exclusively, or otherwise encumber in
any  manner,  any of the  above to any third  party  without  the prior  written
consent of Algo Sub. Should Algo Sub fail to exercise the Option, nothing herein
shall  be  construed  to  prevent  Parent  from  subsequently  licensing,  on  s
non-exclusive  basis, any invention  covered by the above hereunder to any other
for the purpose of practicing any such  invention.  In the event Algo Sub elects
not to exercise the Option, Algo Sub's  non-exclusive  license shall continue on
the terms set forth herein without modification.


SPEAKER ACQUISITION SUB                   AURA SYSTEMS, INC.


By: _______________________________     By: ______________________________

Name: ____________________________      Name: ____________________________

Title: _____________________________    Title: _____________________________


ALGO TECHNOLOGY, INC.                                 AURASOUND, INC.

By:                                                   By:
Name:                                                 Name:

Title:                                                Title:



<PAGE>



                                     OPTION

         This  option  is  entered  into  effective  as of July  ___,  1999 (the
"Effective Date") between Speaker  Acquisition Sub, a Cayman Island  corporation
("Algo  Sub"),  and a  wholly-owned  subsidiary  of  Algo  Technology,  Inc.,  a
California  corporation ("Algo"); and Aura Systems, Inc., a Delaware corporation
("Parent"),  and its wholly-owned  subsidiary  AuraSound,  Inc., also a Delaware
corporation ("Seller").

         (a) For a period of  thirty-six  months (36) months from the  Effective
Date, Parent hereby grants to Algo Sub the irrevocable  option (the "Option") to
acquire all right,  title and interest to the US patent application listed below
(as well as any foreign  counterparts  or cases that claim  priority from the US
patent application listed below):

27/056,795


         (b) During the thirty-six  month period  following the Effective  Date,
Parent shall not license, exclusively, non-exclusively, or otherwise encumber in
any  manner,  any of the  above to any third  party  without  the prior  written
consent of Algo Sub. Should Algo Sub fail to exercise the Option, nothing herein
shall  be  construed  to  prevent  Parent  from  subsequently  licensing,  on  s
non-exclusive  basis, any invention  covered by the above hereunder to any other
for the purpose of practicing any such  invention.  In the event Algo Sub elects
not to exercise the Option, Algo Sub's  non-exclusive  license shall continue on
the terms set forth herein without modification.


SPEAKER ACQUISITION SUB                    AURA SYSTEMS, INC.


By: _______________________________      By: ______________________________

Name: ____________________________       Name: ____________________________

Title: _____________________________    Title: _____________________________


ALGO TECHNOLOGY, INC.                                 AURASOUND, INC.

By:                                                   By:

Name:                                                 Name:

Title:                                                Title:



<PAGE>



                                     OPTION

         This  option  is  entered  into  effective  as of July  ___,  1999 (the
"Effective Date") between Speaker  Acquisition Sub, a Cayman Island  corporation
("Algo  Sub"),  and a  wholly-owned  subsidiary  of  Algo  Technology,  Inc.,  a
California  corporation ("Algo"); and Aura Systems, Inc., a Delaware corporation
("Parent"),  and its wholly-owned  subsidiary  AuraSound,  Inc., also a Delaware
corporation ("Seller").

         (a) For a period of  thirty-six  months (36) months from the  Effective
Date, Parent hereby grants to Algo Sub the irrevocable  option (the "Option") to
acquire all right,  title and interest to the US patent application listed below
(as well as any foreign  counterparts  or cases that claim  priority from the US
patent application listed below):


09/056,394


         (b) During the thirty-six  month period  following the Effective  Date,
Parent shall not license, exclusively, non-exclusively, or otherwise encumber in
any  manner,  any of the  above to any third  party  without  the prior  written
consent of Algo Sub. Should Algo Sub fail to exercise the Option, nothing herein
shall  be  construed  to  prevent  Parent  from  subsequently  licensing,  on  s
non-exclusive  basis, any invention  covered by the above hereunder to any other
for the purpose of practicing any such  invention.  In the event Algo Sub elects
not to exercise the Option, Algo Sub's  non-exclusive  license shall continue on
the terms set forth herein without modification.


SPEAKER ACQUISITION SUB                  AURA SYSTEMS, INC.


By: _______________________________      By: ______________________________

Name: ____________________________       Name: ____________________________

Title: _____________________________    Title: _____________________________


ALGO TECHNOLOGY, INC.                                 AURASOUND, INC.

By:                                                   By:

Name:                                                 Name:

Title:                                                Title:



<PAGE>



                                     OPTION

         This  option  is  entered  into  effective  as of July  ___,  1999 (the
"Effective Date") between Speaker  Acquisition Sub, a Cayman Island  corporation
("Algo  Sub"),  and a  wholly-owned  subsidiary  of  Algo  Technology,  Inc.,  a
California  corporation ("Algo"); and Aura Systems, Inc., a Delaware corporation
("Parent"),  and its wholly-owned  subsidiary  AuraSound,  Inc., also a Delaware
corporation ("Seller").

         (a) For a period of  thirty-six  months (36) months from the  Effective
Date, Parent hereby grants to Algo Sub the irrevocable  option (the "Option") to
acquire all right,  title and interest to the US patent application listed below
(as well as any foreign  counterparts  or cases that claim  priority from the US
patent application listed below):

29/090,939


         (b) During the thirty-six  month period  following the Effective  Date,
Parent shall not license, exclusively, non-exclusively, or otherwise encumber in
any  manner,  any of the  above to any third  party  without  the prior  written
consent of Algo Sub. Should Algo Sub fail to exercise the Option, nothing herein
shall  be  construed  to  prevent  Parent  from  subsequently  licensing,  on  s
non-exclusive  basis, any invention  covered by the above hereunder to any other
for the purpose of practicing any such  invention.  In the event Algo Sub elects
not to exercise the Option, Algo Sub's  non-exclusive  license shall continue on
the terms set forth herein without modification.


SPEAKER ACQUISITION SUB                    AURA SYSTEMS, INC.


By: _______________________________      By: ______________________________

Name: ____________________________       Name: ____________________________

Title: _____________________________     Title: _____________________________


ALGO TECHNOLOGY, INC.                                 AURASOUND, INC.

By:                                                   By:

Name:                                                 Name:

Title:                                                Title:


<PAGE>



                                     OPTION

         This  option  is  entered  into  effective  as of July  ___,  1999 (the
"Effective Date") between Speaker  Acquisition Sub, a Cayman Island  corporation
("Algo  Sub"),  and a  wholly-owned  subsidiary  of  Algo  Technology,  Inc.,  a
California  corporation ("Algo"); and Aura Systems, Inc., a Delaware corporation
("Parent"),  and its wholly-owned  subsidiary  AuraSound,  Inc., also a Delaware
corporation ("Seller").

         (a) For a period of  thirty-six  months (36) months from the  Effective
Date, Parent hereby grants to Algo Sub the irrevocable  option (the "Option") to
acquire all right,  title and interest to the US patent application listed below
(as well as any foreign  counterparts  or cases that claim  priority from the US
patent application listed below):

29/090,938

         (b) During the thirty-six  month period  following the Effective  Date,
Parent shall not license, exclusively, non-exclusively, or otherwise encumber in
any  manner,  any of the  above to any third  party  without  the prior  written
consent of Algo Sub. Should Algo Sub fail to exercise the Option, nothing herein
shall  be  construed  to  prevent  Parent  from  subsequently  licensing,  on  s
non-exclusive  basis, any invention  covered by the above hereunder to any other
for the purpose of practicing any such  invention.  In the event Algo Sub elects
not to exercise the Option, Algo Sub's  non-exclusive  license shall continue on
the terms set forth herein without modification.


SPEAKER ACQUISITION SUB                   AURA SYSTEMS, INC.


By: _______________________________      By: ______________________________

Name: ____________________________       Name: ____________________________

Title: _____________________________     Title: _____________________________


ALGO TECHNOLOGY, INC.                                 AURASOUND, INC.

By:                                                   By:

Name:                                                 Name:

Title:                                                Title:





<PAGE>