January 6, 2003 Press Release

LUMAGEN, INC. INTRODUCES TWO PRODUCTS IN ITS VISION(TM) FAMILY OF PROGRAMMABLE VIDEO PROCESSING SYSTEMS

Portland, Oregon, January 6, 2003. Lumagen, Inc. today announced the introduction of two new video processing systems. The Vision and Vision Pro fill a need in the rapidly growing home theater market for flexible, high quality, yet low cost, video processors. They provide video switching, per-pixel motion-adaptive deinterlacing and fully programmable video scaling, all of which are essential to enabling a truly exceptional home theater experience. The Vision family sets new standards in value. With an M.S.R.P. of only $1295, and $2495, (U.S.) they provide the quality, and features, of video processors costing far more.

The Vision family provides significant visual enhancement for home theaters which are marred by the poor deinterlacing and scaling quality provided by many HDTVs and projectors, which, while providing good picture quality for high-definition sources, fall short for standard definition (SDTV) sources. The Vision video processor eliminates this problem and makes SDTV sources look great on HDTVs and projectors.

The Vision, and Vision Pro share the same high quality TV decoding, deinterlacing, scaling and video output. The distinctions between the two are the number of inputs, case styling, video connectors used, and the control options.

The Vision provides four inputs (composite, SVideo, component and pass-through), using RCA, SVideo and VGA connectors. This input configuration is designed for home theaters that use a receiver’s video switching capabilities. User control is via a 40 button infrared remote control.

In contrast, the Vision Pro has eight user programmable inputs in a rack mountable steel case, with a black-anodized brushed-aluminum front panel, that utilizes professional grade BNC jacks for all video connections. All inputs can be programmed as composite or SVideo. Four of the inputs can be programmed as component and two of these can be programmed as pass-through. The availability of eight inputs eliminates the need for a separate video switch in systems with up to eight video sources. Users can control the Vision Pro using an infrared remote, or an RS232 serial port.

The entire Vision family supports progressive output resolutions of up to 1080p, in scanline increments, and interlaced output at 1080i. The output vertical-refresh-rate can be adjusted from 48 to 75 Hertz, and the output aspect ratio can be adjusted from 1.33 to 2.35.

The deinterlacer converts interlaced video input to progressive video using four input fields to determine the contents of each frame. For progressive material, the original frames are reassembled using 3:2, or 2:2, pull-down reconstruction. For video material, interlaced-video artifacts are detected on a per-pixel basis. Using the result of this artifact detection, the source pixels are merged, or blended, into the best possible progressive image.

Proprietary detail-enhancing algorithms are used to scale the progressive video to the optimal resolution. The video output is over-sampled to enhance the image quality. Video oversampling provides the same benefit that audio oversampling does for CDs. That is, it produces the most-accurate reproduction of the video signal possible.

VISION FAMILY FEATURES:

Inputs

· Advanced TV decoder with 10-bit analog-to-digital conversion
· Pass-through inputs have 300 MHz of nominal bandwidth
· Three, or four-line, comb-filter for reduction of cross-luma and cross-chroma artifacts
· Composite and SVideo inputs automatically select NTSC, PAL, or SECAM

Video Processing

· Film pull-down reconstruction (3:2 and 2:2)
· Per-pixel motion-adaptive video deinterlacing
· Detail-enhancing resolution scaling
· Two configuration memories per TV-decoder input
· Brightness, contrast, color, hue and Chroma-phase calibration for each configuration memory
· Programmable cropping for each configuration memory
· Source aspect ratio selection of 4:3, letter-box and 16:9, with two zoom levels each

Output

· Programmable output resolution from 480p to 1080p in scanline increments, plus 1080i
· Programmable vertical refresh rate from 48 to 75 Hertz, in steps of 0.01 Hertz
· Programmable output aspect ratio from 1.33 to 2.35, in steps of 0.01
· Over-sampled video output using 10-bit digital-to-analog conversion
· RGBHV, RGBS, RGsB, and YPRPB output formats

Miscellaneous

· Infrared remote
· Vision Pro adds RS232 serial-port control
· Easy to use menu-based setup
· Configuration save with undo and lock
· Silent operation (no fan)

About Lumagen:

Lumagen, Inc. designs and manufactures products for the emerging home theater market. It is located in Portland Oregon. For more information call 503-574-2211, email info@lumagen.com, or visit www.lumagen.com

This news release contains forward-looking information within the meaning of federal securities regulations. These forward-looking statements include statements related to the anticipated performance, features and advantages of Lumagen products. These forward-looking statements involve risks and uncertainties that could cause the actual results to differ materially from those anticipated by these forward-looking statements. In particular, Lumagen's products may not have the anticipated performance, features, and advantages, which could cause consumers to choose alternatives over Lumagen's products. Lumagen assumes no obligation to update this forward-looking information.

Lumagen, Vision and Vision Pro are trademarks of Lumagen, Inc.