-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 Qj5tVScBhyOkGjA0tuc2DXDqFnlFPpgHd70xfmvmRbFM4OT3aY577wy2xsMHxw5C
 ZPy9aYqwLxz3PoneMWppDw==

<SEC-DOCUMENT>0001181431-07-029101.txt : 20070503
<SEC-HEADER>0001181431-07-029101.hdr.sgml : 20070503
<ACCEPTANCE-DATETIME>20070502193811
ACCESSION NUMBER:		0001181431-07-029101
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20070502
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20070503
DATE AS OF CHANGE:		20070502

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			AMERICAN TECHNOLOGY CORP /DE/
		CENTRAL INDEX KEY:			0000924383
		STANDARD INDUSTRIAL CLASSIFICATION:	HOUSEHOLD AUDIO & VIDEO EQUIPMENT [3651]
		IRS NUMBER:				870361799
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0930

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-24248
		FILM NUMBER:		07812497

	BUSINESS ADDRESS:	
		STREET 1:		13114 EVENING CREEK DRIVE SOUTH
		CITY:			SAN DIEGO
		STATE:			CA
		ZIP:			92128
		BUSINESS PHONE:		6196792114

	MAIL ADDRESS:	
		STREET 1:		13114 EVENING CREEK DRIVE SOUTH
		CITY:			SAN DIEGO
		STATE:			CA
		ZIP:			92128
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>rrd156689.htm
<TEXT>


<html><head>
<title>Prepared By R.R. Donnelley Financial -- Form 8-K</title>
</head>
<body Bgcolor="white">

<hr Size="4" Noshade Color="#000000" Align="left">

<div><font Size="1">&nbsp;</font></div>

<div Align="center"><font Face="times New Roman" Size="4" Color="#000000">
<b>UNITED STATES </b></font></div>

<div Align="center"><font Face="times New Roman" Size="4" Color="#000000">
<b>SECURITIES AND EXCHANGE COMMISSION </b></font></div>

<div Align="center"><font Face="times New Roman" Size="2" Color="#000000">
<b>Washington, D.C. 20549 </b></font></div>

<div><font Size="1">&nbsp;</font></div>

<div Align="center"><font Face="times New Roman" Size="5" Color="#000000">
<b>Form 8-K </b></font></div> <div><font Size="1">&nbsp;</font></div>

<div Align="center"><font Face="times New Roman" Size="4" Color="#000000">
<b>Current Report </b></font></div>

<div Align="center"><font Face="times New Roman" Size="4" Color="#000000">
<b>Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 </b></font></div>

<div><font Size="1">&nbsp;</font></div>

<div Align="center"><font Face="times New Roman" Size="3" Color="#000000">
<b>Date of Report (Date of earliest event reported):&nbsp;&nbsp;05/02/2007 </b></font></div>




<div><font Size="1">&nbsp;</font></div>

<div Align="center"><font Face="times New Roman" Size="5" Color="#000000">
<b>American Technology Corporation </b></font></div>

<div Align="center"><font Face="times New Roman" Size="2" Color="#000000">
<b>(Exact name of registrant as specified in its charter)</b></font></div>

<div><font Size="1">&nbsp;</font></div>

<div Align="center"><font Face="times New Roman" Size="3" Color="#000000">
<b>Commission File Number:&nbsp;&nbsp;000-24248</b></font></div>

<div><font Size="1">&nbsp;</font></div>

<div Align="center"><table Cellspacing="0" Cellpadding="0" Width="100%" Border="0">
<tr>
<td Valign="bottom" Width="59%" Align="center">
<div Align="center"><font Face="times New Roman" Size="3" Color="#000000"><b>Delaware</b></font>
</div>
</td>
<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;&nbsp;</font>
</td>
<td Valign="bottom" Width="59%" Align="center">
<div Align="center"><font Face="times New Roman" Size="3" Color="#000000"><b>87-0361799</b></font>
</div>
</td>
</tr>

<tr>
<td Valign="top" Align="center" Width="59%">
<div Style="margin-left:2%; Text-indent:-2%" Align="center"><font Face="times New Roman" Size="2" Color="#000000">
<b>(State or other jurisdiction of</b></font>
</div>
</td>
<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;&nbsp;</font>
</td>
<td Valign="bottom" Align="center" Width="59%">
<div Align="center"><font Face="times New Roman" Size="2" Color="#000000"><b>(IRS Employer</b></font>
</div>
</td>
</tr>

<tr>
<td Valign="top" Align="center" Width="59%">
<div Style="margin-left:2%; Text-indent:-2%" Align="center"><font Face="times New Roman" Size="2" Color="#000000">
<b>incorporation)</b></font>
</div>
</td>
<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;&nbsp;</font>
</td>
<td Valign="bottom" Align="center" Width="59%">
<div Align="center"><font Face="times New Roman" Size="2" Color="#000000">
<b>Identification No.)</b></font>
</div>
</td>
</tr>

</table></div>

<div><font Size="1">&nbsp;</font></div>

<div Align="center"><font Face="times New Roman" Size="3" Color="#000000">
<b>15378 Avenue of Science, Ste 100,</div><div Align="center">San Diego, California 92128</b></font></div>


<div Align="center"><font Face="times New Roman" Size="2" Color="#000000">
<b>(Address of principal executive offices, including zip code)</b></font>
</div>

<div><font Size="1">&nbsp;</font></div>

<div Align="center"><font Face="times New Roman" Size="3" Color="#000000">
<b>(858) 676-1112 </b></font>
</div>

<div Align="center"><font Face="times New Roman" Size="2" Color="#000000">
<b>(Registrant&#146;s telephone number, including area code)</b></font>
</div>



<div><font Size="1">&nbsp;</font></div>

<div Align="center"><font Face="times New Roman" Size="3" Color="#000000">
<b> </b></font>
</div>

<div Align="center"><font Face="times New Roman" Size="2" Color="#000000">
<b>(Former name or former address, if changed since last report) </b></font>
</div>


<div><font Size="1">&nbsp;</font>
</div>




<div Align="left"><font Face="times New Roman" Size="2" Color="#000000">
<b>Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:<BR><BR>
</b></font>


</div>



<div Align="left"><font Face="times New Roman" Size="2" Color="#000000">
<b>[&nbsp;&nbsp;]&nbsp;&nbsp;
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)<BR><BR>

[&nbsp;&nbsp;]&nbsp;&nbsp;
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)<BR><BR>


[&nbsp;&nbsp;]&nbsp;&nbsp;
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))<BR><BR>


[&nbsp;&nbsp;]&nbsp;&nbsp;
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
</b>

</font>
</div>





<div><font Size="1">&nbsp;</font>
</div>

<hr Size="4" Noshade Color="#000000" Align="left">


<p Style='page-break-before:always'>
<p Align="center"><font Size="2">
Information to be included in the report</b>
</font>





<div><font Size="1">&nbsp;</font></div>

<div align="left"><font Face="times New Roman" Size="2" Color="#000000">
<b>Item 2.02.&nbsp;&nbsp;&nbsp;&nbsp;Results of Operations and Financial Condition</b></font>
</div>

<div><font Size="1">&nbsp;</font>
</div>

<div  align="left" Style="text-indent:4%"><font Face="times New Roman" Size="2" Color="#000000">
On May 2, 2007, American Technology Corporation issued a press release announcing financial results for its quarter ended March 31, 2007. <p>A copy of the press release is attached hereto as Exhibit 99.1.<p>In accordance with General Instruction B.2. of Form 8-K, the information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.</font>
</div>

<div><font Size="1">&nbsp;</font></div>



<div><font Size="1">&nbsp;</font></div>

<div align="left"><font Face="times New Roman" Size="2" Color="#000000">
<b>Item 9.01.&nbsp;&nbsp;&nbsp;&nbsp;Financial Statements and Exhibits</b></font>
</div>

<div><font Size="1">&nbsp;</font>
</div>

<div  align="left" Style="text-indent:4%"><font Face="times New Roman" Size="2" Color="#000000">
(d) Exhibits<p>Exhibit No.&nbsp;&nbsp;&nbsp; Description<p>99.1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Press Release dated May 2, 2007</font>
</div>

<div><font Size="1">&nbsp;</font></div>



<hr  Size="3" Color="#cceeff" Width="100%" Align="center">
<p Align="center"><font Size="2">&nbsp;</font>
<div Align="center"><font Face="times New Roman" Size="2" Color="#000000">
<b>Signature(s) </b></font>
</div>

<div><font Size="1">&nbsp;</font></div>

<div align="left" Style="text-indent:4%"><font Face="times New Roman" Size="2" Color="#000000">
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized. </font>
</div>

<div><font Size="1">&nbsp;</font></div>

<div><table Cellspacing="0" Cellpadding="0" Width="100%" Border="0">




<tr>
	<td Valign="top" Colspan="3" Width="53%"> <div Style="margin-left:2%; Text-indent:-2%"><font Face="times New Roman" Size="2" Color="#000000"></font>
	</div>
	</td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font>
	</td>
	<td> <font Size="1">&nbsp;</font>
	</td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font>
	</td>	<td Valign="top" Align="center" Width="3%">
	<div Align="center"><font Face="times New Roman" Size="2" Color="#000000">
	</font>
	</div>
	</td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font></td>
	<td Valign="top" Width="53%">
	<div Style="margin-left:2%; Text-indent:-2%"><font Face="times New Roman" Size="2" Color="#000000">
	American Technology Corporation</font>
	</div>	</td>
</tr>
<tr><td>&nbsp;</td></tr>
<tr><td>&nbsp;</td></tr>
<tr>
	<td Valign="top" Colspan="3" Width="53%"> <div Style="margin-left:2%; Text-indent:-2%"><font Face="times New Roman" Size="2" Color="#000000">
	Date: May 02, 2007</font>
	</div>
	</td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font>
	</td>
	<td> <font Size="1">&nbsp;</font>
	</td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font>
	</td>	<td Valign="top" Align="center" Width="3%">
	<div Align="center"><font Face="times New Roman" Size="2" Color="#000000">
	By:</font>
	</div>
	</td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font></td>
	<td Valign="top" Width="53%">
	<div Style="margin-left:2%; Text-indent:-2%"><font Face="times New Roman" Size="2" Color="#000000">
	/s/&nbsp;&nbsp;&nbsp;&nbsp;Thomas R. Brown</font>
	</div>
	<hr Noshade Align="left" Color="#000000">
	</td>
</tr>

<tr>
	<td> <font Size="1">&nbsp;</font></td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font></td>
	<td> <font Size="1">&nbsp;</font></td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font></td>
	<td> <font Size="1">&nbsp;</font></td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font></td>
	<td> <font Size="1">&nbsp;</font></td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font></td>
	<td Valign="bottom" Width="53%">
	<div Style="margin-left:2%; Text-indent:-2%"><font Face="times New Roman" Size="2" Color="#000000">
	Thomas R. Brown</font>
	</div>
	</td>
</tr>

<tr>
	<td> <font Size="1">&nbsp;</font></td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font></td>
	<td> <font Size="1">&nbsp;</font></td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font></td>
	<td> <font Size="1">&nbsp;</font></td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font></td>
	<td> <font Size="1">&nbsp;</font></td>
	<td Valign="bottom" Width="3%"><font Face="times New Roman" Size="1">&nbsp;</font></td>
	<td Valign="bottom" Width="53%">
	<div><font Face="times New Roman" Size="2" Color="#000000">President, Chief Executive Officer and Interim Chief Financial Officer </font>
	</div>
</td>
</tr>
<tr><td>&nbsp;</td></tr>
<tr><td>&nbsp;</td></tr>



</table></div>





<p Style='page-break-before:always'>
<hr  Size="3" Color="#cceeff" Width="100%" Align="center">

<p Align="center"><font Size="2">&nbsp;</font>
<div Align="center"><font Face="times New Roman" Size="3" Color="#000000">
<b>Exhibit Index </b></font>
</div>

<div><font Size="2">&nbsp;</font></div>

<div Align="center">
<table Cellspacing="0" Cellpadding="0" Width="100%" Border="0">




<tr>
	<td Valign="top" Align="left">
	<div Align="left"><font Face="times New Roman" Size="2" Color="#000000">
	<b>Exhibit&nbsp;No.</b></font>
	</div>
		<hr Size="2" Noshade Width="48" Color="#000000">
	</td>
	<td Valign="top" Width="3%" Align="left"><font Face="times New Roman" Size="2">&nbsp;&nbsp;</font></td>
	<td Valign="top" Width="100%" Align="left">
	<div><font Face="times New Roman" Size="2" Color="#000000">
	<b>Description</b></font>
	</div>
	<hr Size="2" Noshade Width="73" Align="left" Color="#000000">
	</td>
</tr>




<tr>
	<td Valign="top" Align="left">
	<div Align="top"><font Face="times New Roman" Size="1" Color="#000000">
	EX-99.1</font>
	</div>

	</td>
	<td Valign="top" Width="3%" Align="left"><font Face="times New Roman" Size="2">&nbsp;&nbsp;</font></td>
	<td Valign="top" Width="100%" Align="left">
	<div><font Face="times New Roman" Size="2" Color="#000000">
	Earnings Release Dated May 2 2007</font>
	</div>
		</td>
</tr>





</div></table>



</body></html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>rrd156689_19889.htm
<DESCRIPTION>EARNINGS RELEASE DATED MAY 2 2007
<TEXT>
<HTML>
<HEAD>
<TITLE>DRAFT 1: 022304</TITLE>
</HEAD>
<BODY LINK="#0000ff" VLINK="#800080">
<B><P>FOR IMMEDIATE RELEASE&#9;&#9;&#9;&#9;&#9;&#9;&#9;&#9;&#9;&#9;</P>
<I><P>&#9;</P>
</I><FONT SIZE=4><P ALIGN="CENTER">AMERICAN TECHNOLOGY REPORTS 54% INCREASE</P>
<P ALIGN="CENTER"> IN YEAR OVER YEAR SECOND QUARTER REVENUES</P>
<P ALIGN="CENTER"></P>
<P ALIGN="CENTER">LRAD Sales Drive Quarterly Year Over Year Revenue Growth</P>
<P>&nbsp;</P>
</FONT><P>SAN DIEGO, CA, May 2, 2007 American Technology Corporation (ATC) (NASDAQ: ATCO)</B>, a leading innovator and producer of directed sound products and solutions<FONT FACE="Arial" SIZE=2>, </FONT>today reported results for its second fiscal 2007 quarter ended March 31, 2007. </P>
<P>ATC reported revenues for the second quarter of $2.26 million, a 54% increase from $1.47 million in revenues for the same quarter of last fiscal year. Revenues increased due to sales of LRAD products to a growing number of customers. The marketing efforts of the Company's enhanced sales force, successful product deployments and extensive product demonstrations have contributed to increased market awareness and customer acceptance of ATC's suite of LRAD products. Gross profit for the quarter ended March 31, 2007 was $1.11 million, or 49% of revenues, compared to $188,000, or 13% of revenues, for the same period ended March 31, 2006. Gross profit increased primarily due to higher product sales as well as decreased production costs and warranty expense.</P>
<P>The operating loss for the second quarter of fiscal 2007 was $1.12 million compared to $2.36 million for the prior year's second quarter. The decrease in loss from operations resulted primarily from the increase in revenues and gross profit as a result of increased LRAD deliveries as well as a significant decrease in personnel costs due to a restructuring of the management team in the fourth quarter of fiscal 2006. The net loss for the quarter ended March 31, 2007 was $1.03 million or $(0.03) per share, compared to a net loss of $2.63 million or $(0.11) per share for the same period ended March 31, 2006. </P>
<P>Operating expenses decreased from $2.55 million for the quarter ended March 31, 2006 to $2.23 million for the same period ended March 31, 2007. The $2.23 million in operating expenses included $100,000 of legal, accounting and consulting costs associated with a voluntary review of historical stock option grants and the related restatement of financial statements for fiscal years 2005 and 2004 including 2003 and 2002 financial data and certain adjustments for 1999 to 2001. </P>
<P>For the six months ended March 31, 2007, the Company reported revenues of $6.17 million representing an 82% increase from $3.39 million for the six months ended March 31, 2006. The increase in revenues was due to increased sales of LRAD products to a growing number of customers. For the first six months of fiscal 2007, gross profit was $3.08 million, or 50% of revenues, compared to $1.25 million, or 37% of revenues, for the same period a year ago. The increase in gross profit was principally the result of the increased sales of our LRAD products as well as decreased production and labor costs and warranty expense.</P>
<P>The operating loss for the six months ended March 31, 2007 was $1.72 million compared to the operating loss of $4.24 million for the same period a year ago. Included in the 2007 operating loss was $413,000 of non-cash stock-based compensation charges compared to $378,000 for the comparable period in 2006. The decrease in loss from operations resulted primarily from the increase in revenues and gross profit as a result of increased LRAD deliveries as well as a significant decrease in personnel costs due to a restructuring of the management team in the fourth quarter of fiscal 2006. Operating expenses decreased from $5.49 million for the six months ended March 31, 2006 to $4.80 million for the same period ended March 31, 2007. The net loss for the six months ended March 31, 2007 was $1.55 million or $(0.05) per share, compared to a net loss of $3.40 million or $(0.14) per share for the six months ended March 31, 2006. </P>
<P>&quot;Over the last six months we have streamlined operations, cut operating and product costs, increased margins, introduced enhanced directed sound products and made progress incorporating LRAD into the programs and systems of large commercial and defense-related companies,&quot; said Tom Brown, president and chief executive officer of American Technology Corporation. </P>
<P>&quot;Our fiscal Q2 LRAD sale to the Singapore Navy through ST Engineering and our initial LRAD-R order to L-3 Communications are the beginning of expected increasing sales to large commercial and defense-related organizations,&quot; continued Brown. &quot;We are experiencing growing interest in LRAD-R as a remotely-operated, IP addressable solution incorporating a full menu of options enabling commercial, security and military personnel to locate, communicate with and deter potential threats at extended distances.&quot;</P>
<P>&quot;With six-month fiscal 2007 revenues at 69% of annual fiscal 2006 revenues, we are on target to surpass last fiscal year's annual revenues with improved margins and operating results,&quot; concluded Brown. </P>
<B><FONT SIZE=3><P>About American Technology Corporation</P>
</B><P>American Technology Corporation provides directed audio solutions that place clear, highly intelligible sound exactly where needed. ATC's HyperSonic Sound, NeoPlanar and Long Range Acoustic Device (LRAD) product lines make up the core of an expanding portfolio of directed sound products and technologies. For more information about ATC and its directed sound solutions please visit the company's web site at <B>www.atcsd.com.</B> </P>
</FONT>
<B><FONT SIZE=2><P>Safe Harbor statement under the Private Securities Litigation Reform Act of 1995:</B> This press release contains forward-looking statements that reflect our current view with respect to future events and performance. These statements are forward-looking statements and are subject to the Safe Harbor provisions created by the Private Securities Litigation Reform Act of 1995.  These forward-looking statements are based on current information and expectations, and involve a number of risks and uncertainties.  Actual results may differ materially from those projected in such statements due to various factors. More information about potential factors that could affect our business and financial results is included in the Form 10-K for the fiscal year ended September 30, 2006 under the heading "Item 1A Risk Factors."  You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualifi
ed in their entirety by this cautionary statement, and we undertake no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date any such statement is made.</P>
</FONT>
<P>FOR FURTHER INFORMATION CONTACT:</P>
<P>Investor Relations:&#9;&#9;&#9;&#9;&#9;</P>
<P>Robert Putnam&#9;&#9;&#9;&#9;&#9;</P>
<P>(858) 676-0519&#9;&#9;&#9;&#9;&#9;</P>
<P>robert@atcsd.com&#9;</P>
<FONT SIZE=3>
<P>&nbsp;</P></FONT>
<TABLE BORDER CELLSPACING=2 CELLPADDING=7 WIDTH=574>
<TR><TD VALIGN="BOTTOM" COLSPAN=5 HEIGHT=21>
<B><P ALIGN="CENTER">American Technology Corporation </B></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=5 HEIGHT=21>
<B><P ALIGN="CENTER"> Condensed Statements of Operations</B></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=5 HEIGHT=21>
<B><P ALIGN="CENTER">(000's omitted except per share and per share amounts)</B></TD>
</TR>
<TR><TD VALIGN="BOTTOM" COLSPAN=5 HEIGHT=21>
<B><P ALIGN="CENTER">(Unaudited)</B></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" ROWSPAN=2 HEIGHT=17><P></P></TD>
<TD WIDTH="26%" VALIGN="BOTTOM" COLSPAN=2 HEIGHT=17>
<FONT SIZE=2><P ALIGN="CENTER">For the three months ended</FONT></TD>
<TD WIDTH="26%" VALIGN="BOTTOM" COLSPAN=2 HEIGHT=17>
<FONT SIZE=2><P ALIGN="CENTER">For the six months ended</FONT></TD>
</TR>
<TR><TD WIDTH="26%" VALIGN="BOTTOM" COLSPAN=2 HEIGHT=18>
<FONT SIZE=2><P ALIGN="CENTER"> March 31, </FONT></TD>
<TD WIDTH="26%" VALIGN="BOTTOM" COLSPAN=2 HEIGHT=18>
<FONT SIZE=2><P ALIGN="CENTER"> March 31, </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=18><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=18>
<FONT SIZE=2><P ALIGN="CENTER">2007</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=18>
<FONT SIZE=2><P ALIGN="CENTER">2006</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=18>
<FONT SIZE=2><P ALIGN="CENTER">2007</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=18>
<FONT SIZE=2><P ALIGN="CENTER">2006</FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P>Total revenues</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">2,261 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">1,472 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">6,165 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">3,388 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P>Cost of revenues</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">1,154 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">1,284 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">3,088 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">2,136 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=22>
<B><FONT SIZE=2><P>Gross profit</B></FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">1,107 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">188 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">3,077 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">1,252 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21>
<B><FONT SIZE=2><P>Operating expenses:</B></FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P>  Selling, general and administrative</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">1,655 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">2,047 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">3,699 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">4,422 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P>  Research and development</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">575 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">502 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">1,098 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">1,068 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P>Total operating expenses</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">2,230 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">2,549 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">4,797 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">5,490 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P>Loss from operations</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">(1,123)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">(2,361)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">(1,720)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">(4,238)</FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21>
<B><FONT SIZE=2><P>Other income (expense):</B></FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P>  Interest income</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">90 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">70 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">206 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">145 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P>  Interest and finance expense</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">--</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">--</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">(33)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21>
<FONT SIZE=2><P ALIGN="RIGHT">(1)</FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P>  Unrealized gain (loss) on derivative revaluation</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">--</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">(339)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">--</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">693 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P>Total other income (expense)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">90 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">(269)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">173 </FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">837 </FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=21><P></P></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=22>
<B><FONT SIZE=2><P>Net loss </B></FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">(1,033)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">(2,630)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">(1,547)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT">(3,401)</FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=23>
<B><FONT SIZE=2><P>Net loss per share of common stock - basic and diluted</B></FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=23>
<FONT SIZE=2><P ALIGN="RIGHT">($0.03)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=23>
<FONT SIZE=2><P ALIGN="RIGHT">($0.11)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=23>
<FONT SIZE=2><P ALIGN="RIGHT">($0.05)</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=23>
<FONT SIZE=2><P ALIGN="RIGHT">($0.14)</FONT></TD>
</TR>
<TR><TD WIDTH="48%" VALIGN="BOTTOM" HEIGHT=23>
<B><FONT SIZE=2><P>Average weighted number of common shares outstanding</B></FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=23>
<FONT SIZE=2><P ALIGN="RIGHT">30,142,426</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=23>
<FONT SIZE=2><P ALIGN="RIGHT">24,382,731</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=23>
<FONT SIZE=2><P ALIGN="RIGHT">30,115,565</FONT></TD>
<TD WIDTH="13%" VALIGN="BOTTOM" HEIGHT=23>
<FONT SIZE=2><P ALIGN="RIGHT">24,342,884</FONT></TD>
</TR>
</TABLE>
<FONT SIZE=3>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P></FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=7 WIDTH=578>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=12>
<FONT SIZE=2><P><A NAME="RANGE!A1:D35">&nbsp;</A></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=12>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=12>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=12><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=12>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="83%" VALIGN="BOTTOM" COLSPAN=4 BGCOLOR="#ffffff" HEIGHT=16>
<B><P ALIGN="CENTER">American Technology Corporation </B></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
</TR>
<TR><TD WIDTH="83%" VALIGN="BOTTOM" COLSPAN=4 BGCOLOR="#ffffff" HEIGHT=20>
<B><P ALIGN="CENTER">Condensed Balance Sheets</B></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=20><P></P></TD>
</TR>
<TR><TD WIDTH="83%" VALIGN="BOTTOM" COLSPAN=4 HEIGHT=20>
<B><P ALIGN="CENTER">(000's omitted)</B></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20><P></P></TD>
</TR>
<TR><TD WIDTH="83%" VALIGN="BOTTOM" COLSPAN=4 HEIGHT=20>
<B><P ALIGN="CENTER">(Unaudited)</B></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20><P></P></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<P ALIGN="CENTER">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<P ALIGN="CENTER">&nbsp;</TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="CENTER">March 31,</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="CENTER">September 30,</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<P ALIGN="CENTER">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<P ALIGN="CENTER">&nbsp;</TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="CENTER">2007</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="CENTER">2006</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="CENTER">&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="CENTER">&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="CENTER">&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<B><FONT SIZE=2><P>ASSETS</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<B><FONT SIZE=2><P>Current assets:</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>  Cash and cash equivalents</FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> $8,012 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> $9,896 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>  Accounts receivable</FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">1,800</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> 2,055 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>  Inventories, net of $57 and $12 reserve for obsolescence</FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">4,907 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> 4,450 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>  Prepaid expenses and other</FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">86</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> 139 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<B><FONT SIZE=2><P>Total current assets</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">14,805</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> 16,540 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<B><FONT SIZE=2><P>Equipment</B>, <B>net</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">536</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> 694 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<B><FONT SIZE=2><P>Patents, net</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">1,382</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">1,416</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<B><FONT SIZE=2><P>Long term deposits</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">58 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">58</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=22>
<B><FONT SIZE=2><P>Total assets</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=22>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT"> $16,781 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=22><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=22>
<FONT SIZE=2><P ALIGN="RIGHT"> $18,708 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<B><FONT SIZE=2><P>&nbsp;</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=20>
<B><FONT SIZE=2><P>LIABILITIES AND STOCKHOLDERS' EQUITY</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=20>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=20>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=20><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=20>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<B><FONT SIZE=2><P>Current liabilities:</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P> Accounts payable</FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> $1,211 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> $1,904 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P> Accrued liabilities</FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">1,019</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> 1,978 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<B><FONT SIZE=2><P>Total current liabilities</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> 2,230 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> 3,882 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=21>
<B><FONT SIZE=2><P>Long-term liabilities:</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=21>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=21>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=21><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=21>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff">&nbsp;</TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff">&nbsp;</TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff">&nbsp;</TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff">&nbsp;</TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff">&nbsp;</TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff">&nbsp;</TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>Extended warranty</FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">-- </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">2</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>Derivative warrant instrument</FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">-- </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT"> 1,221 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<B><FONT SIZE=2><P>Total liabilities</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">2,230 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P ALIGN="RIGHT">5,105 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=20>
<B><FONT SIZE=2><P>Total stockholders' equity</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=20>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=20>
<FONT SIZE=2><P ALIGN="RIGHT">14,551 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=20><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=20>
<FONT SIZE=2><P ALIGN="RIGHT"> 13,603 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=28>
<B><FONT SIZE=2><P>Total liabilities and stockholders' equity</B></FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=28>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=28>
<FONT SIZE=2><P ALIGN="RIGHT"> $16,781 </FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=28><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=28>
<FONT SIZE=2><P ALIGN="RIGHT"> $18,708 </FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" BGCOLOR="#ffffff" HEIGHT=16>
<FONT SIZE=2><P>&nbsp;</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=16><P></P></TD>
<TD WIDTH="4%" VALIGN="BOTTOM" HEIGHT=16><P></P></TD>
<TD WIDTH="15%" VALIGN="BOTTOM" HEIGHT=16><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=16><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=16><P></P></TD>
</TR>
</TABLE>
<FONT SIZE=3>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P></FONT></BODY>
</HTML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
