American Technology Corporation Appoints John Zavoli as Interim Chief Financial Officer; Company Names Karen Jordan as Chief Accounting Officer.

SAN DIEGO -- American Technology Corporation (ATC) (NASDAQ:ATCO), an innovator of directed sound products and technologies, announced today it has appointed John Zavoli, the company's president and chief operating officer, as its interim chief financial officer. The company also appointed Karen Jordan as its chief accounting officer. Ms. Jordan joined ATC last month as its director of finance. Michael Russell, the company's former chief financial officer, has resigned, but will continue as an employee of the company to assist with the completion of the company's audit for the fiscal year ended September 30, 2005. Mr. Russell's resignation did not result from any disagreement with the company, known to any executive officer of ATC, regarding any accounting or financial reporting issue.

Mr. Zavoli brings more than 20 years of multinational financial, operating, corporate finance and Big 4 consulting experience to ATC. He has directed corporate financial, treasury, tax, and legal operations for public and VC-funded corporations, and has held senior financial roles at Digital Equipment Corporation, Madge Networks and Waste Management International. He also is a former partner at PricewaterhouseCoopers LLP, where he advised high tech clients in global operations, taxation, fiscal management, M&A, and other related issues. Mr. Zavoli's employment terms will not change as a result of this interim appointment.

Ms. Jordan joined the company in November 2005 as director of finance. She brings to ATC more than 15 years of multinational finance and accounting experience working for private and public companies. From July 2003 to November 2005, Ms. Jordan was a self-employed bankruptcy executive managing the Estates of LCS Management, Inc. and LCS West, Inc. From January 2001 to July 2003, Ms. Jordan was corporate controller with LifeCare Solutions, Inc., a provider of integrated home healthcare products and services. From June 1996 to January 2001, Ms. Jordan held various positions with Quidel Corporation, a developer and manufacturer of diagnostic tests for detection of a variety of medical conditions and illnesses. At the time Ms. Jordan left Quidel Corporation, she held the position of assistant controller. Ms. Jordan is a Fellow Chartered Accountant in Ireland. Ms. Jordan received her Associate Chartered Accountant license from the Institute of Chartered Accountants in Ireland.

"The promotion of Karen Jordan from director of finance to chief accounting officer will help strengthen our finance organization," said Mr. Zavoli. "We are finalizing our annual report on Form 10-K which we expect to file on or before December 29, 2005."

As previously reported on December 15th, ATC expects to report in the Form 10-K revenues of approximately $10.2 million for the fiscal year ended September 30, 2005 as compared with the previous fiscal year's revenues of $5.8 million. Gross profit for fiscal 2005 is expected to be approximately $4.5 million or 44% of revenues, compared to $2.3 million or 40% of revenues for fiscal 2004. The increase in revenues and gross profit is principally the result of an increase of sales of the company's LRAD products. ATC expects selling, general and administrative expenses to be approximately $9.1 million or 89% of revenues for fiscal 2005, compared with $5.3 million or 92% of revenues for fiscal 2004. Research and development costs are expected to be $4.6 million or 45% of revenues for 2005, a 54% increase from $3.0 million in 2004. ATC made heavy investments in fiscal 2005 completing new HSS(R), portable LRAD(TM), and NeoPlanar(R)-based products, and in growing its sales and marketing organization. Loss from operations is expected to be approximately $9.3 million for fiscal 2005 compared to $6.0 million for fiscal 2004. The increase in loss in fiscal 2005 resulted from increases in selling, general and administrative expenses and research and development expenses, partially offset by increased gross profit. Based on the procedures and audit still underway, there may be additional adjustments to the fiscal 2005 results.

About American Technology Corporation

American Technology Corporation is Shaping the Future of Sound(R) through its proprietary directed sound products and technologies which include: the award-winning HSS(R) (HyperSonic(R) Sound technology); LRAD(TM) (Long Range Acoustic Device) products family; NeoPlanar(R) products family, Sound Vector(TM) technology, and others. The Company is establishing a strong portfolio of patents, trademarks, and intellectual property including over 320 U.S. and foreign patents and pending patent applications 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: This press release contains forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, including statements relating to the company's expectation that it will file its 2005 Form 10-K on or before December 29, 2005 and the company's expected financial results to be reported in the 2005 Form 10-K. These forward-looking statements involve a number of risks and uncertainties, including uncertainties related to the results and completion of the audits of the company's financial statements and assessment of its internal control over financial reporting. These and other factors could cause the company's actual results to differ materially from what it projects in its forward-looking statements, and could delay the filing of the Form 10-K beyond the December 29, 2005 extended filing deadline. These forward-looking statements are based on information and management's expectations as of the date of this press release. For more information regarding other potential risks and uncertainties, see the "Business Risks" section of the company's most recent Form 10-Q for the quarter ended June 30, 2005 and the "Risk Factors" section of the company's Form 10-K/A for the year ended September 30, 2004. The company disclaims any intent or obligation to update these forward-looking statements.