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                                                                         EX-10.5


                                  AMENDMENT TO
                              EMPLOYMENT AGREEMENT


                 This Amendment to Employment Agreement (this "Amendment") is
entered into as of March 14, 1997, between SRS Labs, Inc., a Delaware
corporation (the "Company"), and Arnold Klayman, an individual (the
"Employee").


                                    RECITALS

                 A.      The Company and the Employee entered into a certain
Employment Agreement dated as of July 1, 1996 (the "Agreement").

                 B.      The Company and the Employee now desire to amend the
Agreement to (i) increase the Employee's Initial Base Salary under Section
3.1.1. of the Agreement and (ii) extend the term of the Agreement under Section
2 of the Agreement.


                                   AGREEMENT

                 NOW, THEREFORE, in consideration of the provisions set forth
in this Amendment, and other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

                 1.       Capitalized terms used herein shall have the meanings
ascribed to such terms in the Agreement unless otherwise defined herein.

                 2.       Section 2 of the Agreement is hereby amended and
restated in its entirety to read as follows:

                          "2.   Term.  The initial term of this Agreement shall
                 commence as of May 1, 1996 and shall continue in effect until
                 December 31, 1999.  On December 31, 1999, and on the 31st day
                 of December of each year thereafter (unless this Agreement
                 shall have been previously terminated), the term of this
                 Agreement shall be automatically extended for an additional
                 term of one year unless either party shall provide the other
                 with at least 30-days written notice prior to such December
                 31st of the party's intent to terminate this Agreement.  In
                 the event that the Company shall provide written notice of
                 termination to the Employee, the Employee will be entitled to
                 the severance benefits set forth in Section 4.3 herein.  Upon
                 the payment of such severance benefits, the Company shall be
                 relieved from any liability for the unexpired term of this
                 Agreement."





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                 3.       Section 3.1.1 of the Agreement is hereby amended and
restated in its entirety to read as follows:

                          "3.1.1.   Initial Base Salary.  The initial Base
                 Salary to be paid to the Employee hereunder is $90,000 per
                 year for the Company's 1996 fiscal year.  The Base Salary to
                 be paid to the Employee hereunder during the Company's 1997
                 fiscal year shall be $95,000 from January 1, 1997 to March 31,
                 1997 and $110,000 from April 1, 1997 to December 31, 1997.  In
                 addition, during the Company 1998 and 1999 fiscal years, the
                 Base Salary to be paid to the Employee shall be $120,000 and
                 $130,000 per year, respectively."

                 4.       This Amendment shall be deemed to be an amendment to
the Agreement, and the Agreement, as amended hereby, is hereby ratified,
approved and confirmed in each and every respect.  All references to the
Agreement in any other document, instrument, agreement or writing shall
hereafter be deemed to refer to the Agreement as amended hereby.

                 5.       This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original, but all such
counterparts together shall constitute but one and the same Amendment.

                 IN WITNESS WHEREOF, the parties hereto have executed this
Amendment as of the date first written above.



COMPANY:
                                       SRS LABS, INC., a Delaware corporation



                                       By:  /s/ STEPHEN V. SEDMAK
                                          -------------------------------------
                                          Stephen V. Sedmak
                                          President and Chief Operating Officer



EMPLOYEE:
                                          /s/ ARNOLD KLAYMAN
                                          -------------------------------------
                                              Arnold Klayman