American Technology Corporation Announces Multi-Million Dollar HSS(R) H450 Purchase Agreement from In-Store Broadcasting Network (IBN); IBN Supplying HSS H450s to Select First Tier Retailers.

SAN DIEGO -- American Technology Corporation (ATC) (Nasdaq:ATCO), an innovator of proprietary sound reproduction technologies, today announced an HSS(R) H450 purchase agreement with In-Store Broadcasting Network (IBN). Under the agreement, IBN has agreed to purchase 12,000 HSS H450s for their in-store media networks located in select first tier retailers. The agreement calls for ATC to begin shipping its proprietary HSS H450s to IBN in the quarter beginning October 1, 2005 with continuing scheduled quarterly shipments.

In-Store Broadcasting Network is the largest retail place-based media company in the world. IBN is the only measured electronic retail media company with exposure to more than 256,943,000 shopper visits per month in over 17,000 grocery and drug stores in the US and Canada. IBN deploys patented technology and systems comprising "Perfect Media(TM)," a unique synchronized and integrated media combination including audio, video, and other targeting technologies and methods that deliver advertising messages guaranteeing audience reach. IBN and Kroger Company recently announced a long-term agreement for the implementation of "Perfect Media(TM)" across the 2,524 Kroger stores starting in 2006.

"We are very pleased to announce this major HSS digital in-store media network order and agreement with IBN," said Kalani Jones, president and chief operations officer of American Technology Corporation. "IBN's first tier retailers will provide tremendous exposure for HSS while giving millions of shoppers a unique digital signage listening experience."

Robert Brazell, chairman and chief executive officer of IBN, commented, "We are excited to bring the revolutionary HSS audio experience to digital in-store networks. We operate in the majority of key drugstore and supermarket retailers, and we pride ourselves in offering our retailer partners and advertisers the most efficient and effective advertising vehicle at the point of sale. HSS offers an unprecedented level of control and customization in targeting advertising messages to the listeners of our networks."

HyperSonic Sound(R) (HSS) is a highly directional sound reproduction technology that utilizes ultrasonic columns to provide extremely accurate control of sound placement for digital signage, displays, exhibits, and other focused sound applications. ATC's H450 is an economical and flexible HSS product adaptable to meet the needs of many sound reproduction markets.

About In-Store Broadcasting Network

IBN currently operates the in-store and commercial audio systems for Kroger, Safeway, Ahold, Albertsons, Walgreens, Rite Aid, Osco, Savon, Duane Reade, Meijer and other retailers. For more information, please visit www.ibnads.com.

About American Technology Corporation

American Technology Corporation is Shaping the Future of Sound(R) by developing, manufacturing and globally distributing its proprietary sound technologies and products which include: the award-winning HSS(R) (HyperSonic(R) Sound technology); LRAD(TM) (Long Range Acoustic Device) products family; NeoPlanar(R) products family, and others. The Company is establishing a strong portfolio of patents, trademarks, and intellectual property including over 320 U.S. and foreign patents and patent filings to date. For more information on the company and its technologies and products please visit our web site at www.atcsd.com.

Safe Harbor statement under the Private Securities Litigation Reform Act of 1995: Except for historical information contained herein, the matters discussed are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act. You should not place undue reliance on these statements. We base these statements on particular assumptions that we have made in light of our industry experience, the stage of product and market development as well as our perception of historical trends, current market conditions, current economic data, expected future developments and other factors that we believe are appropriate under the circumstances. These statements involve risks and uncertainties that could cause actual results to differ materially from those suggested in the forward-looking statements, including our dependence on a limited number of large orders, which the modification or termination of such orders could result in less than expected future revenues, potential technical or manufacturing difficulties that could delay shipments, and other risks identified and discussed in the our filings with the Securities and Exchange Commission. These forward-looking statements are based on information and management's expectations as of the date hereof. Future results may differ materially from our current expectations. American Technology Corporation disclaims any intent or obligation to update those forward-looking statements, except as otherwise specifically stated.