Digital Speaker Development Update

SYDNEY, Feb. 14, 2013

The ongoing development efforts to commercialize our digital speaker technologies into a high demand product realized a major milestone; the successful completion of the second of our four-phase product commercialisation plan. The first two phases of the plan were designed to focus on the optimisation of the individual electromechanical structures. The positive results attained from Phase-II, have now enabled the company to shift focus from structural optimization to the production of a completed high performance end product.

The positive outcome was a result of our exceptionally close collaboration with our fabrication partners, which began delivering Phase-II chips during the month of December 2012. These chips were exhaustively measured and tested using our newly designed proprietary test equipment. Planning for Phase III is well advanced.

About Audio Pixels Holdings Limited

Audio Pixels Holdings Limited is a company listed on the Australian Stock Exchange with the code AKP and has its ADR's listed on the OTCQX market in the USA with code ADPXY. Audio Pixels Holdings Limited owns 100% of Audio Pixels Limited, an unlisted Israeli corporation that was founded in July 2006 and has developed a revolutionary technological platform for reproducing sound, thus enabling the production of an entirely new generation of speakers that will exceed the performance specifications and design demands of the world's top consumer electronics manufacturers.

Audio Pixels patented technologies employ entirely new techniques to generate sound waves directly from a digital audio stream using low cost micro-electromechanical structures (MEMS) rather than conventional loudspeaker elements. This innovation enables the production of speaker products that deliver performance that is many orders of magnitude better than conventional speaker technologies, all in an affordable package that is only one millimetre thick.

Audio Pixels MEMS-based Digital Sound Reconstruction platform enables the market for audio speakers to follow the evolution of the video display market from large, heavy analog tube based monitors to the digital flat panel displays of today. Driving the rationale for change in audio speakers is the ever-increasing demand for smaller, thinner, clearer sounding, more power-efficient speakers. Conventional speaker technologies remain deeply rooted in the original voice coil inventions of Alexander Graham Bell. The inherent limitations of such speakers prohibit the delivery of quality sound in smaller packages. Audio Pixels innovative patents in the fields of electromechanical structures, pressure generation, acoustic wave generation and control, signal processing and packaging, combine to forever change this paradigm.