FREMONT, Calif., May 28 /PRNewswire/ -- Aureal Semiconductor Inc. (OTC Bulletin Board: AURL - news), a leader in digital audio imaging, today announced that it completed its previously announced $20 million subscription rights offering. This sale of 33.3 million shares of common stock was completed on May 21, 1999.

The $20 million rights offering is part of a multi-step capital restructuring program designed to provide additional capital for the Company's growth strategy, restructure Aureal's capital framework, enable it to qualify for listing on the Nasdaq National Market and provide additional liquidity for its investors. A portion of the proceeds has been utilized to pay down the existing balance of the company's line of credit. Remaining proceeds will be used to fund anticipated growth.

The company also reported that it has filed the necessary forms with the Nasdaq Stock Market for initial listing on its National Market System. According to David Domeier, Aureal's senior vice president of finance and CFO, ``We're pleased to be on track with the restructuring process to-date. Now that the rights offering has been successfully completed and our application to Nasdaq has been submitted, we look forward to the next steps of executing the reverse stock split and Nasdaq completing their review. We have received shareholder support for our program and feel confident that it will bring us closer to achieving our objectives for the restructuring program.''

About Aureal Semiconductor

Aureal is a leading provider of advanced audio solutions for the computer, consumer, entertainment, Internet and professional audio markets. The company designs, builds and distributes advanced audio semiconductor and software solutions for personal computers and consumer electronics devices through the OEM, integrator/reseller/VAR and direct-to-customer channels. Aureal also licenses technology designed to define and improve advanced audio standards in the marketplace.

Leading industry partners include Compaq Computer Corporation, Dell Computer Corporation, Sony Electronics and Diamond Multimedia Systems. Aureal's award-winning product line includes A3D positional audio technology, Vortex audio processors and Vortex-based sound cards, and A3D Pro sound design software. For more information on Aureal or its products and industry leading audio technologies, please visit our Websites at www.aureal.com and www.a3d.com.

Forward-Looking Statements

Forward-looking statements in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties including, but not limited to, dependence on the PC and consumer electronics industries and on product lines based on new technologies; foundry capacity, availability and reliability; competition and pricing pressures; and other risks detailed from time to time in the company's periodic reports filed with the Securities and Exchange Commission.

SOURCE: Aureal Semiconductor Inc.