<SEC-DOCUMENT>0000814676-16-000061.txt : 20160307
<SEC-HEADER>0000814676-16-000061.hdr.sgml : 20160307
<ACCEPTANCE-DATETIME>20160304174939
ACCESSION NUMBER:		0000814676-16-000061
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20151226
ITEM INFORMATION:		Results of Operations and Financial Condition
FILED AS OF DATE:		20160307
DATE AS OF CHANGE:		20160304

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CPS TECHNOLOGIES CORP/DE/
		CENTRAL INDEX KEY:			0000814676
		STANDARD INDUSTRIAL CLASSIFICATION:	POTTERY & RELATED PRODUCTS [3260]
		IRS NUMBER:				042832509
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1227

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-36807
		FILM NUMBER:		161486380

	BUSINESS ADDRESS:	
		STREET 1:		111 SOUTH WORCESTER STREET
		CITY:			NORTON
		STATE:			MA
		ZIP:			02766
		BUSINESS PHONE:		508-222-0614

	MAIL ADDRESS:	
		STREET 1:		111 SOUTH WORCESTER STREET
		CITY:			NORTON
		STATE:			MA
		ZIP:			02766

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CERAMICS PROCESS SYSTEMS CORP/DE/
		DATE OF NAME CHANGE:	19920703
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>k8cc02242016cc.htm
<DESCRIPTION>CONFERENCE CALL Q4 AND YEAR ENDED DECEMBER 26, 2015
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<P STYLE="margin: 0">&nbsp;</P>

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<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center"><B>UNITED STATES</B><BR>
<B>SECURITIES AND EXCHANGE COMMISSION</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center"><B>Washington, D.C. 20549</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center"><B>FORM 8-K&nbsp;</B><BR></P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">Current Report<BR>
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934<BR>
</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">Date of Report (Date of earliest event
reported): February  24, 2016</P>

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<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 12pt"><B>CPS TECHNOLOGIES
CORPORATION</B></FONT><BR>
(Exact Name of Registrant as Specified in its Charter)</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<TABLE ALIGN="CENTER" CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 34%; padding-right: 5.4pt; padding-left: 5.4pt; font-weight: bold; text-align: center">Delaware</TD>
    <TD STYLE="width: 33%; padding-right: 5.4pt; padding-left: 5.4pt; font-weight: bold; text-align: center">0-16088</TD>
    <TD STYLE="width: 33%; padding-right: 5.4pt; padding-left: 5.4pt; font-weight: bold; text-align: center">04-2832509</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">(State or other jurisdiction of incorporation)</P>
        <P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P></TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">(Commission File Number)</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">(IRS Employer Identification No.)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2" STYLE="padding-right: 5.4pt; padding-left: 5.4pt; font-weight: bold; text-align: center">111 South Worcester Street, Norton, Massachusetts</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; font-weight: bold; text-align: center">02766</TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2" STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">(Address of principal executive offices)</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">(Zip Code)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2" STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2" STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Registrant&rsquo;s telephone number, including area code</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; font-weight: bold; text-align: center">508-222-0614</TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="3" STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="3" STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="3" STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">(Former name or former address, if changed since last report.)</TD></TR>
</TABLE>
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<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0">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 (<U>see</U> General Instruction
A.2. below):</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0">[ ]&#9;Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0">[ ]&#9;Soliciting material pursuant to Rule 14a-12 under the exchange
Act (17 CFR 240.14a-12)</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0">[ ]&#9;Pre-commencement communications pursuant to rule 14d-2(b)
under the<BR>
Exchange Act (17CFR 240.14d-2(b))</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0">[ ]&#9;Pre-commencement communications pursuant to Rule 13e-4(c)
under the<BR>
Exchange Act (17 CFR 240.13e-4(c)).</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

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<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0">Item 2.02 &#9;Results of Operations and Financial Condition</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0">The Company hosted a conference call on February 24, 2016
to review the fiscal quarter and fiscal year ended December 26, 2015 results and to answer questions from investors. A
transcript of this conference call is attached hereto as Exhibit 99 and is incorporated herein by reference. The
information furnished under Item 2.02, including the Exhibit attached hereto, shall not be deemed &lsquo;filed&rsquo; for any
purpose, including for purposes of Section 18 of the Securities and Exchange Act of 1934 (the &ldquo;Exchange Act&rdquo;) or
otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under
the Securities Act of 1933 or the Exchange Act, regardless of any general incorporation language in such filing.</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

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<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center"><B>SIGNATURE</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">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 thereunto duly authorized.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

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<TR STYLE="vertical-align: top">
    <TD COLSPAN="2" STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; text-decoration: underline"><B><U>CPS Technologies Corporation</U></B><BR>
(Registrant)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 52%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">Date: March 4, 2016</TD>
    <TD STYLE="width: 48%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">
        <P STYLE="margin-top: 0; margin-bottom: 0">/s/ Ralph M. Norwood</P>
        <P STYLE="margin-top: 0; margin-bottom: 0">Ralph M. Norwood</P>
        <P STYLE="margin-top: 0; margin-bottom: 0">Chief Financial Officer<BR>
        </P></TD></TR>
</TABLE>
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<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0">EXHIBIT INDEX</P>

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    <TD STYLE="width: 20%; padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0">EXHIBIT NUMBER</P>
        <P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0; text-indent: 0.5in">&nbsp;</P></TD>
    <TD STYLE="width: 80%; padding-right: 5.4pt; padding-left: 5.4pt">DESCRIPTION</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">99</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">Transcript of conference call held February 24, 2016.</TD></TR>
</TABLE>
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<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>2
<FILENAME>cc02232016q415.htm
<DESCRIPTION>CONFERENCE CALL TRANSCRIPT
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<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>CPS TECHNOLOGIES CORP</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Moderator: Ralph Norwood</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>February 24, 2016</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>4:30 p.m. ET</B></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/200% Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-indent: -0.5in">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0">Operator:&#9;This is Conference #54589578</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;Good afternoon my
name is Ronnie and I will be your conference operator today. At this time I would like to welcome you to the CPS Technologies fourth
quarter and year end 2015 investor conference call.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>All lines have been placed on mute to prevent any background noise, after the speaker&rsquo;s remarks there will be a question
and answer session. To ask a question during this time press star then the number one on your telephone keypad, if you&rsquo;d
like to withdraw your question press the pound key, thank you.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>I would now like to turn the conference over to Ralph Norwood chief financial officer, please go ahead.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Thank you
operator and good afternoon everyone. Before we begin the business portion of the call I would like to point out to all of you
that the statements in this conference call that are not strictly historical in forward looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995, and should be considered as subject to the many uncertainties that exist
in CPS&rsquo;s operations and environment.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>These uncertainties include economic conditions, market demands and competitive factors, such factors could cause actual results
to differ materially from those in any forward looking statement. Now I would like to turn the call over to Grant so he can offer
his perspective on the fourth quarter results.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Thank you Ralph and welcome to everyone thank you for joining us. Ralph will delve into the numbers in more detail in just
a minute, but in terms of highlights from the fourth quarter, on revenues of $5.4 million we achieved the highest gross margin
percentage in the fourth quarter for any quarter in 2015; gross margins were 23 percent, up from 18 percent in Q3.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>We achieved our highest operating profit for any quarter in 2015 and we ended the quarter and the year with the highest cash
balance, $3.4 million, for any quarter or year in the past several years.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;As our earnings release
covers both the quarter and the year let me make some comments that touch on both periods. We&rsquo;ve been focused in 2015 on
strengthening and expanding our sales and marketing organization, and on deepening their reach worldwide and improving their focus
and effectiveness.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>We&rsquo;ve added sales representatives --- most recently, Tom Sleasman the former manager of Thermal Management Solutions
Division of the Rogers Corporation which was a former competitor is now representing us in Arizona which is a key market. Tom brings
an in-depth knowledge of the benefits and properties of our products and an in-depth knowledge of current and potential applications
and customers.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;We in just about a
month ago, January of this year, we hired Mark Haft as our new global director of sales and marketing for Armor. Mark joins us
from very successful career, initially at DSM the manufacturer of Dynema and, most recently, of Superior Graphite. In mid year
last year we hired a full time salesman in China, Li Kai. He&rsquo;s doing a wonderful job.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>We are providing qualification samples and quotations to several of our major targeted customers primarily in the railway and
automotive business in China. Mark Occhionero and I were there visiting these customers in October and we see many significant
opportunities.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;Finally, in this quarter
we have just begun a search for an additional senior sales marketing business development executive to join our team. After he
or she is on board, we will have doubled our internal sales resources over the last year, and we will have significantly strengthened
our worldwide network of sales representatives.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>In our business, revenues are generated by selling products and products are generated by what we call design wins. A design
win is when a customer selects our product and we agree on the actual blueprint for his product. In 2015, we designed, booked,
fabricated tooling for and shipped more than one new design, essentially more than one new product, per week.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;Some of these designs
will always be low volume. For example, we have a number of parts in certain military satellites which are relatively low volume
applications. Some of these designs are prototypes for customers who are in the development stage for their systems and we may
go though several iterations - two, three, four, five - different specific designs making prototypes for them as they fine tune
their systems.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>Some of these designs are the initial shipments for programs that we believe will become substantial and long running over
time.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;The design win for
AMDR, the Air Missile Defense Radar program, a few years ago, is an excellent example of this latter type. In total these design
wins in 2015 account for a very small percentage of 2015 revenues. Between five and ten percent of our revenues in 2015 were accounted
for by the design wins achieved in 2015. However, it&rsquo;s these design wins and this pipeline that generates revenues in the
future.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>Two brief comments on specific topics: in the area of armor, we received a one million dollar order from TACOM, part of the
Army and located in Michigan. We received an order from TACOM in the fourth quarter and we&rsquo;ve already made some initial deliveries
under this order. And finally,</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9; in Japan just under a
week ago, on February 18th the Japanese Supreme Court officially declined to hear the appeal filed by our competitor of the lower
court&rsquo;s ruling which invalidated key claims of their patent. This is a very important victory for CPS. There is one final
step in this saga; our competitor has one opportunity before the Japanese Patent Office to attempt to rewrite the claims to address
the reasons given by the court for invalidating the patent.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>This will take three to four months and we don&rsquo;t believe they will be successful in overcoming the court&rsquo;s reasons
for invalidation. Once that step is complete, hey will have exhausted all avenues of appeal; we believe the invalidation will then
become effective and this issue will be behind us.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;So, while generating
cash and earnings to ensure our foundation remains strong, we are most importantly investing in the future. Over the past year
and looking forward to this coming year, those investments are in the sales and marketing area. Ralph, let me turn it back to you
for more detail.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Thank you
Grant.<BR>
Total revenue for the quarter was $5.4 million which was 9 percent below the $5.9 million we generated in the fourth quarter of
2014. The shortfall was primarily due to lower shipments of baseplates and approximately $100,000 of price reductions.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Gross margin for the quarter
totaled $1.3 million or 23 percent of sales.</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>This is a very important element that we need to discuss. Last year the margin was 26 percent, but, as we&rsquo;ve mentioned
many times in the past, we have high fixed cost and as a result our margin percentage is significantly impacted by volume. The
fact that we generated $500,000 of higher sales last year was the primary reason with the three percent difference in margin.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>That&rsquo;s important but it&rsquo;s also important to mention the 23 percent in this quarter was up from 18 percent a very
low number in the third quarter on flat volume. The increase was due to two principle factors: a favorable mix where we sold higher
margin base plates than we did in Q3 and the absence of an unusual $200,000 of sales returns we suffered in the third quarter.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;Turning now to our
selling general and administrative expenses --- we spent almost exactly the same amount this year in the fourth quarter as we did
last year, but there was a, also a mix change. We spent more on China (we really didn&rsquo;t have any investment in China at this
time last year), and we spent more on NASDAQ fees where we listed on NASDAQ in January. The sum of</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>those would be over $100,000. And we also had a higher 401k match. These were offset by lower accruals for incentive compensation
and lower legal costs as we spent a lot last year, as you&rsquo;re aware, on the patent situation in Japan.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;Operating profits
for the fourth quarter totaled $296,000 compared with $578,000 in the fourth quarter last year. Again, this decrease was primarily
due to lower volume and, to a lesser degree, the $100,000 of price reductions. Net income for the quarter totaled $254,000 compared
with $619,000 in the last quarter of 2014. A portion of this difference is due to a</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>tax provision when last year we actually trued up at the end of the year and it was a six percent tax credit in the quarter
compared to a 15 percent provision rate in this most recent quarter.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;Turning now to the
balance sheet --- as Grant said, we ended the quarter with $3.4 million of cash, the highest level that I could find in the last
several years. This compares with 2.3 million last year. The reason for the $1.1 million dollar increase: first, since we do not
essentially pay taxes, other than</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>a small amount to the state, our operating profit of $600,000 goes right to cash; in addition, we have almost $300,000 of non-cash
stock compensation expense associated with stock options. The sum of those two would be $900,000 of the $1.1 million increase in
cash. Our receivables totaled $3.6 million at the end of the year representing 59 days sales outstanding compared with 54 a year
ago. Both of these ratios are somewhat lower than we typically experience which is a good sign and we haven&rsquo;t had any bad
debts in a number of years.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;Inventories at the
end of the quarter totaled $2.6 million really --- flat with last year and pretty much flat throughout the year. This represented
an inventory turnover of six and a half times for all of 2015. On the liability side, payables and accruals in total amounted to
$2.5 million --- also in line with last year in line with the past few quarters and represent typical agings and accruals.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>Now just a couple of more points before we take questions&hellip;.. On the balance sheet side, we have tax assets, when summing
both current and long term, of over $2 million. And what that means is the next $6 million or so --- maybe even more --- of operating
profit that we earn will be shielded from tax payments.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>And lastly, our balance sheet ratios remained very strong. We had a current ratio at the end of the year of 4.0 times and a
debt to equity of 0.2. At this time operator we&rsquo;re ready to take some questions.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>At this time if you&rsquo;d like to ask a question press star one on your telephone keypad, again that&rsquo;s star one, and
we&rsquo;ll pause for just a moment to compile the Q&amp;A roster, and our first question comes from the line of Fred Milligan
with Milligan Group.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Hi Fred.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Hey good afternoon, Fred.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Fred Milligan:&#9;Great! Hey,
Raytheon &hellip;.. about a year, year and a half ago we talked about a rather significant order from Raytheon, and now I am not
hearing anything about it. Where does that stand?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>It&rsquo;s every bit as significant as it was a year ago. It helps us illustrate one element of the sales cycle of our business.
This design win was achieved several years ago, but production is in the future. The component goes into a system called Air Missile
Defense Radar, AMDR. After several years of competition between major primes the Navy has awarded the final development funding
and production contract to Raytheon.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;This is a new generation
of phased array radar that is scalable and it will initially be installed on the flight three class of the Arleigh-Burke destroyers.
There are thousands of our base plate in each installation.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>These programs go through several stages. There&rsquo;s the initial</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>development and then there&rsquo;s the RDT&amp;E stage. The next stage is the &ldquo;low rate initial production&rdquo;, and
then into high rate production. Were are simply in a pause during the RDT&amp;E phase where the shipments that we did make about
a year ago are what they need to continue to be meet their engineering milestones.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;When this system goes
into production we, we are looking at anywhere from $3 to $5 million of revenue a year from this one component. We happen to be
aware of Raytheon&rsquo;s quarterly conference call from January 28<SUP>th</SUP>, just about a month ago. In that call Tom Kennedy,
the CEO of Raytheon, referred to the AMDR program; let me just read from the transcript of that call. He&rsquo;s talking about
his strategy and then he says, quote: &ldquo;We look at programs that are going to have runs for decades. What&rsquo;s the next
Patriot? One of the</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;examples is Air Missile
Defense Radar AMDR. That&rsquo;s going to be our next major franchise coming to fruition here in the next several years&rdquo;,
end quote.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>The first year we made prototypes for the program we might have generated $20,000 of revenue. Then there would have been a
gap of a year or two and then a year ago generated a couple of hundred thousand dollars of revenue.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>We expect some additional orders towards the end of this year but the production is still a little bit in the future. But,
again, it will run for years and years and years.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Fred Milligan:&#9;Well that&rsquo;s
good. You know Japan --- how significant is this, I mean, when you get up and running with the competition.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>We believe this is significant. Essentially, without going into detail, our competitor has cast a doubt and injected a little
bit of fear in the marketplace related to this patent. We do not infringe the patent but that&rsquo;s difficult to prove so we
decided to follow the avenue of invalidating the patent. Once that fog is completely lifted then we can compete on essentially
an even playing field.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>In our largest market, which is the market for motor controllers --- primarily for trains, subway cars and heavy industrial
equipment --- the market is just about as big in Japan as it is in Europe, and frankly the prices are higher in Japan than they
are in Europe. So, again, this is relieving a constraint that has been quite frustrating to us.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Fred Milligan:&#9;There was
an article in last week in Wall Street Journal one day I think 19th, on magnesium coming into play in regard to cars, lighter weight
and stronger. This seems to me is a definition of what you&rsquo;re doing. Does that have any significance as far as your concerned?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>I did see that I think it was Fiat.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Fred Milligan:&#9;That&rsquo;s
right Fiat.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>I think for a trunk lid if I remember correctly. It doesn&rsquo;t directly impact us and magnesium is reasonably expensive.
And while it doesn&rsquo;t directly impact us, it illustrates that weight and stiffness are important. Although we have had some
prototypes, what we call structural components, that we have sold into the auto industry for evaluation, we don&rsquo;t see that
in the near term as a major market.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>Coming out of our development in armor, we have the ability to make sheets or foils that have some unique fire barrier protections,
and we believe that there are some very real opportunities for us there. But, in short, some applications weight is key and the
article you refer to is proof of that.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Fred Milligan:&#9;I think
Ralph mentioned price reduction. It&rsquo;s the first I&rsquo;ve heard of price reduction. What&rsquo;s that about?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;This is,
a direct function of the strengthening dollar --- basically in Europe where approximately 50 percent of our revenues are earned.
You can look up the exchange rate but fundamentally the strengthening dollar means that our product has, pick the time period you
want, 15 to 20 percent more expensive and, as a result, we&rsquo;ve had to simply reduce price in, in order to retain the business
there.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Fred Milligan:&#9;OK all right.
I have more questions but that&rsquo;s all for now let somebody else come in.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Thank you,
Fred, we&rsquo;ll be here.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Fred Milligan:&#9;OK.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>Your next question comes from the line of (Farad) (inaudible) with Horton funds.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Mike):&#9;&#9;Hi, Grant and
Ralph it&rsquo;s (Mike) from the The Horton Fund</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Hi (Mike) how are you?</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Mike):&#9;&#9;Good thanks,
thanks for all the info. Grant, I was wondering if you folks might have the comparable stats that you quote for 2015 design wins
averaging more than once a week? Presumably that&rsquo;s more than 50 for the</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>year, but only accounting for 10 percent of revenues in, in this year. Do you have the same information for the class of 14,
the class of 13, 12, and 11 so going back four or five years? What&rsquo;s the contribution to this year&rsquo;s revenue&rsquo;s,
15 revenues were from the respective design win classes, over there, over that period? And the other comparable stats?</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Excellent question. We do, of course, track the exact number of design wins and they were up by over 10 percent in 2015 compared
to 2014. Looking back at our annual planning process --- essentially at the beginning of the year --- about 80 percent of our revenues
are identifiable clearly at the beginning of the year because those are the products that are in volume production.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>And those design wins by definition had to occur in prior years, and that number has been relatively steady.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;When you look at that
number I actually find it to be quite breathtaking that we are fabricating the custom tooling, completing the design, getting customers&rsquo;
sign off, and making and shipping a new design at a rate ofapproximately every week.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>What you find is that as a customer starts to use (AlSiC) you actually go through fewer and fewer iterations with them. In
other words, a customer who is experienced with the material knows what it will do. They will go straight to the final design that
goes it goes into production whereas, with a newer customer who is not as familiar with material, we might go through again 2,3,4,
5,6 iterations before one of those is locked down and goes into production.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Mike):&#9;&#9;Sure, so the
earlier you are in the development cycle the more iterations you have before you can productize it if you ever can or if they ever
can.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>That&rsquo;s exactly right. It is the stage in the development cycle and then simply the experience the customers themselves
have with the material. In other words, if you look at our major customers they will design the material in, taking full advantage
of it and will order the production tooling as the very first item. Whereas a customer that&rsquo;s less familiar will go through
a couple of iterations or prototypes.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Mike):&#9;&#9;Right, OK,
that&rsquo;s very helpful. If you could disclose what the class of 11, 12,13 and, 14 of the design wins contributed say to 15&rsquo;s
revenues. In terms of what the number was each year and then what an aggregate that those individual products, the one or two or
three that evolved into products however many they were. I am not interested in necessarily the number that they were but what
they represented in the terminal years revenues, the terminal year in this case being 15.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>I understand the question and let us think it through. Your question demonstrates in my mind that you see the nature of the
sales cycle in the custom component business.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Mike):&#9;&#9;The stopped
clock is right, twice a day, Grant.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;That&rsquo;s
true too.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Mike):&#9;&#9;Well thank
you.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Thank you.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>Your next question comes from the line of Robert Manning a private investor.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;Does Raytheon
disclose publically anything that helps us get an idea of when this three to five million dollars a year revenues is going to begin
to make its</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9; way to us or do we know
anything privately that you can tell us?</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>We can speak about this program because we issued a press release which Raytheon reviewed in detail and authorized us in writing
to release; and that was, you know, about a year and a half ago or so.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>There is a page on the Raytheon website dedicated to this program that has a little bit of information on it. If you research
some of the statements by the Navy about the construction schedule for Flight III Arleigh-Burke destroyers you can begin to put
some numbers together.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;What those numbers
tell us if you go to the Raytheon webpage is that they will be deploying in the year 2020. But they&rsquo;ll be buying things from
us considerably before that. I assume that there&rsquo;s a lot of assembly that happens before that and we&rsquo;re not going to
have to wait until 2020 to see those revenues.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning: To the extent
that you can only tell us what we can glean from the public information, what clue do we have is this a 2017 event, 2018, 2019
or do we just flat out do not know?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Well, here&rsquo;s
what we know. For example, if you look up this program in Wikipedia - you can&rsquo;t trust everything you read - but it says the
Navy hopes to place AMDR on the first Flight III Arleigh-Burke class destroyer possibly beginning 2016.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;Yes but
that&rsquo;s clearly obsolete. You know that.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;That&rsquo;s
right but what we do know is that there is the RTD&amp;E which is very systematic and there&rsquo;s again this LRIP, low rate initial
production, and then there&rsquo;s some stages that go to full production.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>We believe that Raytheon will be installing a system on one ship soon. Our own view is that that will occur sometime in 2017
and if it occurs early in the year we&rsquo;ve seen some demand this year and if it occurs later in the year we&rsquo;ll start
to see demand next year.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;Well we&rsquo;ve
&hellip;.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Well Bob
I think your questions a good one, and we have, as you know, some good connections with Raytheon at the board level and we have
intentions on getting more information and as we get it we will share it with the public.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;This is
going to be a big deal and I guess that this has been in the offering for a long while. Now, what tends to happen to our margins
in one of these long running programs as, as time passes? Presumably we have a learning curve which gets our costs down; but, presumably,
the customer you know wants some or all of that passed along to them in reduced selling price. Is there any way to generalize about
what happens to the margins on these long running programs? I mean, if we&rsquo;ve got another Patriot here which is going to go
on for decades. What, what can be the, expectation in terms of trend of the margins?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Bob, this
is Ralph. If it were the automotive industry I would say that every year they&rsquo;re expecting price reductions.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;Right.
Yes, this is better than that I know, I hope?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Yes, it
certainly is, and we&rsquo;re the sole supplier of this component, and relative to the company we&rsquo;re still a pretty small
fish. So we have reason to believe, and some of that is through information of that we have close to the company, that these should
generate attractive margins for a long time.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;OK.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;It&rsquo;s
like, if I were a guessing man I am not sure I am going to be here in 2026 --- might be but probably not --- I think the margin
percentage would probably be not much different than it is, than it will be in 2017.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;OK.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;And, if
anything, I think above average for our business.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;Sure yes,
now you know this is really advanced high powered radar, and we seem to have a competitive advantage here. How much (Fargo) is
really making on whatever new high powered radars anybody in our military has &hellip; Can we see anything happening there in the
next year or two or is that longer term than that?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Of course the military is spending a lot of money on various radar coming out of the Office of Naval Research.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;There is an initiative
called FlexDAR. FlexDAR is yet a future generation radar, and it&rsquo;s in the research stage. We&rsquo;ve had a design win in
that program. By the time it eventually goes into production, it probably will be a modified design but we believe that it will
be in that program.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;And so we are out
aggressively marketing this and we believe there will be very meaningful additional opportunities in radar around the world.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>Radar is subject to export controls. We have growing experience in applying for and receiving export licenses and so we&rsquo;re
in a position where we certainly are experienced. Once we understand a potential customer, we can quickly screen whether we may
or may not be allowed to ship to that customer and if we are we would apply for a license.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;OK any
kind of update on China rail? is the slowdown in the Chinese economy a negative for us?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>So I was there in October. The government of China has merged the two major state owned railway companies, China Northern Rail
and China Southern Rail, into a company called China Railway Rolling stock. It goes by the initial &ldquo;CRRC&rdquo;.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>The scope of what they&rsquo;re doing is so large that, you pick up the newspaper and read that the GDP maybe growing by, you
know 6.4 as opposed to 6.9 percent, and, and we can&rsquo;t see any difference. So I don&rsquo;t think it will make a difference.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;&#9;And,
Bob, as you I think you&rsquo;re aware what&rsquo;s happening is that the China Southern and China Northern rail used to buy and
still do the motor controllers from customers of ours. But they will be doing more, rather significant vertical integration, so
they&rsquo;ll be buying their baseplates directly.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;From us
instead of going through somebody else and&hellip;</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;&#9;Exactly.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;And that
somebody else may not get all they may get some stuff from (inaudible) in addition to us so we get more business I guess we hope.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;&#9;Yes,
well we think we have frankly an advantage in dealing versus the Japanese for cultural reasons as we&rsquo;ve discussed. But we&rsquo;ve
met the rail companies in China several times. And, as you know, they are also involved in the big subway acquisitions in the Commonwealth
of Massachusetts.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>We&rsquo;ve leveraged that to meet with them and we recently met in Springfield where they will be assembling the cars. Although
that won&rsquo;t be huge business, per se, for us the contacts are important and we&rsquo;re leveraging the political contacts
as well.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;OK so that&rsquo;s
intact despite the Chinese economy, good thank you very much.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Well absolutely,
absolutely.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>Your next question comes from the line of (Walter Schenker) with Maz Partners.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Walter):</TD><TD>Actually two questions, first on use of cash. If one looks at the business you&rsquo;re doing 20 odd million dollars of revenue
dividend inventory and accounts receivable as payables it&rsquo;s about 20, 25 cents on the dollar of sales.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>And so even if the business were to grow five million dollars that would probably only require an additional getting on top
of the, back of the envelop not top of my head both, a million to million and a half dollars of working capital.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;So at this point what
will you be doing with the excess cash I mean you can pay dividends you can buy back stock, obviously you can buy back a million
and a half shares with, you know if you wanted to, or a million shares, first question and I&rsquo;ll just put the second one on
the table and then shut up.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>In the past you&rsquo;ve mentioned that you&rsquo;ve had discussions in Japan with some of the potentially large customers,
so to get to get yourself teed up for whenever the final litigation ends. You&rsquo;ve indicated that, that market potentially
is as big as European market and you&rsquo;ve indicated that pricing is more attractive there. How quickly or how far along are
you in since you&rsquo;ve now wanted the next core level as well, how quickly can that ramp up in Japan?</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Let me answer
that question and I&rsquo;ll let Ralph comment on, on cash. You know the Japanese in general would prefer to do with the suppliers
located in their own country whose native language is Japanese. Just like American companies would prefer to deal with American
companies. But the Japanese companies have unambiguously told us that they very much need a second source.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>And so our business plan calls for us to start with a very minor percent of their share but quickly move to a reasonable second
source position. And there are several companies over there and some companies and we alluded to in our previous conference call
said we&rsquo;re going to bring you onboard on new products.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>Others are willing to give us a share of existing products&gt; I am looking for the right adjective but, but solid and meaningful,
but not zero to a 100 miles an hour overnight.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Let me address
the cash situation. We have no plans to pay dividends, we have no plans to buy back stock and your numbers are good (Walter). It&rsquo;s
a little less than 20 percent of sales when you take pure working capital, so that should not inhibit our growth. But we think
if we, have excess cash that that will serve a couple of purposes in the broad umbrella.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>It will help us apply funds on an opportunistic basis to grow. In some cases that will be sales and marketing; in other cases
it could be strategic targeted acquisition of some type somewhere in the world. We don&rsquo;t have any immediate plans to do that,
but I can tell you that we now and then have people come forth to us with ideas. We think it&rsquo;s, it&rsquo;s very good to have
cash that we haven&rsquo;t had before to make sure that we can pursue these growth opportunities and not be slowed down with a
bump in the road.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;One additional
comment on cash and be careful here to make sure I communicate correctly. We are working in some new products that and I am thinking
particularly of, of certain armor opportunities where the simply the physical size of the product means that, there would need
some meaningful capital expenditures because our current equipment isn&rsquo;t sized appropriately. And, I am anxious not to communicate
that there&rsquo;s a huge cash need there but some of this cash will absolutely be used for capital expenditures.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Walter):</TD><TD>Thank you</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Thank you.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>And your next question comes from the line of Robert Manning a private investor.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;You mentioned
armor could you give us any idea of what&rsquo;s going on there, I mean I know we have this million dollar order that we&rsquo;re
working on which we hope will lead to something else perhaps much larger what can you tell us about that?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Sure, the broad armor world segments into a couple of different segments --- one that everyone is familiar with is is, is so
called personal protective armor, basically a vest. Today we are not active in that area. The funding from the Army that we had
in the cooperative agreement with ARL was focused on very heavy armor. Tanks were the initial focus.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>What we are doing is taking what we&rsquo;ve learned from that Army contract and matching market needs with our competitive
advantage which is light weight, multi hit capability, ease of attachment and robustness of the panels themselves. We see the match
between those properties and the market needs in light vehicle armor.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;We are working with
armor integrators, and in some cases with primes, but generally with armor integrators who are testing combining our armor with
their integration and with us pitching that to various DOD and commercial customers. We have signed, for example, a memorandum
of understanding that outlines the terms under which we and a major armor integrator are jointly marketing to the DOD for a specific
defined DOD application.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;Timeline
on this &hellip;.. do we hear anything in the year two years, five years what, what do we know?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Armor was
a very small percent of our revenue in 2015, and it will be in dollars terms much larger this year yet still relevantly modest.
But we basically see that it&rsquo;s going to be generating increasing revenues as we go forward.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;You know 100 percent
of our shipments last year were for evaluation and development, with one exception, where it is on a fielded vehicle.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>That continues to be the case as of this moment. But the programs that we are targeting have real needs, and that&rsquo;s why
we hired Mr. Haft. We need someone on a daily basis interacting with those program managers.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;Can you
comment it all on our current business and the outlook for the balance of the year when you, you know something about the first
couple of months maybe you can&rsquo;t tell us but anything you could would be interesting?</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;OK, well as
a policy we don&rsquo;t forecast or give guidance but we still genuinely want to try and be helpful. Let me equivocate a little
bit by looking out 18 months rather than 12 months.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>We would expect between now and 18 months we would have more business in Japan, we&rsquo;d have more business in China, and
we would have some, initial armor that was out of the qualification stage. Also, the additions to our sales representatives and
some of those design wins this year would be generating revenue in some cases by the end of the year and, and certainly next year.
We believe that whether it&rsquo;s the end of this year or the beginning of next year that the AMDR a component will be meaningful.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;We look out and we
can say that over an 18 month time period we predict that our revenues will be certainly meaningfully higher than they are today.
The exact start and stop date and you know how many parts Raytheon purchases for the first destroyer, there&rsquo;s still some
uncertainly in that.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>So our revenues will be fluctuating. We begin this year with a similar kind of forecast from many of our customers as we had
last year and then we have these new items that we&rsquo;ve been investing in that we think will will start to mature.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Robert Manning:&#9;Great thanks
very much.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Thank you.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>And your next question comes from the line of (Wolf Scheck) with Wells Fargo advisors.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Wolf):</TD><TD>Hi gentlemen, how are you?</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Hi (Wolf) good to hear your voice.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Wolf):</TD><TD>Good how are you doing Ralph?</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Just great thank you.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Wolf):</TD><TD>And hi (Ralph).</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Hi.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Wolf):</TD><TD>Just following up on the overseas efforts in terms of China, just what from your sales person that you&rsquo;ve retained over
there. What kind of feedback are you getting in actual fact I mean we hear so many different things depends what day of the week
and who you really believed. But what kind are you getting any feedback of what&rsquo;s really going on in China? And how are you
going to be able to respond to that and also with the currencies, you know both the Yuan and the dollar up and down and so on.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>How are you going to be able to -- what&rsquo;s your plan of coping, coping with that and how is that going to affect your
selling and your bidding. Do we have any comments you can mention?</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>There is nothing like going to with your own eyes and so I&rsquo;ve been in the actual facilities where these modules will
be manufactured in China. And we&rsquo;re, we&rsquo;re realistic you know, think about manufacturing in Massachusetts and shipping
to China. Why we believe that this is an opportunity for us is because the safety and quality requirements in the railway industry
are exacting and they&rsquo;re clear.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>It&rsquo;s a worldwide standard and if China hopes to successfully sell railway rolling stock around the world to places like
the Boston subway system they need to provide high quality, safe products. Their strategy, even though they&rsquo;re assembling
in China, is to source those critial components from the same places that their major competitors are sourcing them from in order
to be able to ensure the quality.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;We have an opportunity
in the railway business in China; they want to and need to buy the same components that the Europeans and Japanese are buying in
order to ensure the quality as they get off the ground and assemble their modules. And so, and even though China does move fast,
this is a business you don&rsquo;t just ramp up railway or airplane production quickly.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>So as they ramp up production we have an opportunity to be there with them, and so the timing is right. We&rsquo;re in as they
are starting to build the modules themselves. And we think that we have an opportunity to be a meaningful supplier there for many
years in the railway system and in automotive applications.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;What is attractive
is that there are very significant government mandates tied, not to a fuel economy, but tied to pollution which has created a very
large market for hybrid and electric vehicles. We don&rsquo;t have the only solution but we have a proven solution that has many
benefits for the motor controller for hybrid and electric vehicles. We believe that as we get in front of those customers that
we&rsquo;ll be able to be an important player in that market.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Wolf):</TD><TD>OK, how do you see the Japanese market, do you have enough exposure there to really comment on what&rsquo;s going on?</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>And, here you have with these negative interest rates the Yuan is excuse me the Yen has really gone against, against them.
So how do you assess things over, did you have any comment?</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Well, from our perspective the fundamentals are that again they are the major producers there and the major producers are Mitsubishi
Electric, Hitachi Limited and Fuji Electric. Toshiba is a relatively minor player. Toshiba&rsquo;s obviously under enormous challenges
at the moment, but the major players are in production, they view this product line as strategic and they indeed want a second
source.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>We can absolutely fill that role and, once we&rsquo;re reliability doing that we certainly believe we&rsquo;ll have the opportunity
to gain more share. We do believe that we&rsquo;re low cost compared to our competitor but there&rsquo;s cost obviously in shipping
it to to Japan.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Wolf):</TD><TD>So are you looking for both of these areas to be as supportive of some growth, the next year so this year they were in?</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0">(Grant):&#9; Yes, we will absolutely see revenues from, from
both these locations, without question this year.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Wolf):</TD><TD>May I ask one sorry.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Yes, go ahead.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Wolf):</TD><TD>May I cover one other area?</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Sure.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Wolf):</TD><TD>Just going on back to the domestic markets here so that with all of your wins the design wins that you&rsquo;ve had. And building
up the cadre of salespeople, you should be able to see some developments this year that could be pretty interesting, and we have
so many different things going on.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>Do you have any comment on that and the, design wins the designs that you make for individuals and individual customer, is
that going to be for that specific customer or are you going to be able to use that product on on a more liberal basis as after
the initial development.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Let me use a simple base plate as an example. We make motor control baseplates for many customers and a layman looking at them
from a distance would just assume there are all exactly the same.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>In fact they are very similar but each customer has different holes in different locations in order to mount their own housing
in it, so that when we talk about a design win, we are referring to the exact design of a product that a customer will use.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>But certainly that does allow us to go to a second customer who is making a similar product and we&rsquo;ll still need to modify
or develop new tooling. But, in the nature of your question, no we do not sign agreements that prohibit us from selling similar
products to other companies.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Wolf):</TD><TD>OK well thank you very much this is a very thorough conference call I appreciate your time.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Thank you.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>And there are no further questions at this time.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Would you
ask the, participants one more time and give them one last chance for any questions they may have?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>Certainly at this time I would like to remind everyone if you would like to ask a question please press star followed by the
number one on your telephone keypad, again that was star one to ask a question. And you have a question from the line of (Frank
Wisneski) individual shareholder.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Frank):</TD><TD>Hi good afternoon.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant): Hi.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Frank):</TD><TD>A couple of questions, on the AMDR do you have any information on what the volume might be for your product?</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>The simple answer is no not as clearly as we would like. But I think what you&rsquo;re getting at is when we originally made
the contract it was specified it would amount from our standpoint to about $17 million over four to five years. Once again it&rsquo;s
the full production, but you ask a good question we should have that answer and, and our fingertips we don&rsquo;t. We are not
privy to the exact scale on a particular ship, but it&rsquo;s, so let me leave it at that.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Frank):</TD><TD>One quick follow up as you mentioned your Japanese customers don&rsquo;t like to have sole source but have you got any feel
that Raytheon maybe looking for a second source for this or is this something that&rsquo;s so, so unique to you that, that they&rsquo;re
going to have to live with the sole source arrangement.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;I believe
that sole source is fine and what Raytheon does do and they do it very well, is they scrutinize and qualify their vendors. We&rsquo;ve
had many visits from very large teams of personnel from Raytheon who are systematically analyzing every possible supply risk.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>I think their approach is to recognize that if they&rsquo;re going to get leading edge, advanced technology and they&rsquo;re
going to get it in the volumes and in the reliability they need, they&rsquo;ve got to have a close relationship with a small number
of stable companies.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>To get this design win this just wasn&rsquo;t an engineering evaluation, this was a very thorough evaluation of the finances
of the company, the manufacturing capability of the company, they looked at the whole picture.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;A couple
of more things worth mentioning as (Grant) said earlier, they had to vet the press release we put up and we mentioned $17 million
over the next five years and they accepted that. So that gave us confidence, plus there aren&rsquo;t a lot of companies that can
meet the requirements that they had for this particular component --- very few as a matter of fact.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Actually for
this specific component I believe we are the only company in the world that can make it.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Frank):</TD><TD>And but it did want to stay domestic anyhow I think on something like this, so you wouldn&rsquo;t have any.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;&#9;Well,
I&rsquo;ll just leave it at that but they, they had part of the federal government to come in and actually look over and make sure,
for example, on affirmative action that we didn&rsquo;t have any black marks against us.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Frank):</TD><TD>OK, and he has another question the, the shelf you know you talked about your, your need for capital not overpowering need
obviously you got plenty of capacity now and you probably need a machining and stuff, but in light of that could you run over the
thoughtfulness of the shell filing that you filed, it seemed to be to be unneeded, but I&rsquo;d like to, I&rsquo;d like to hear
your, your thoughtfulness on that.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;&#9;Sure
I&rsquo;ll take that one on.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;I&rsquo;ll be bold
and say my own opinion that a CFO of a public company that doesn&rsquo;t have a shelf is half asleep at the job. You just don&rsquo;t
know what opportunities that come up in short notice where if you needed to raise money quickly you could, and there&rsquo;s literally
no cost to having a shelf.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Frank):</TD><TD>OK.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;&#9;And
having been in the situation where I&rsquo;ve had to issue unregistered shares, it&rsquo;s a big penalty. If we had a need for
the 5 million dollars, then we could do it through a PIPE with registered shares and do it quickly. There are speed and cost advantages
to it. We have no immediate plans just to make sure the world knows that it&rsquo;s simply a matter of having flexibility like
another arrow in a quiver.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Frank):</TD><TD>OK, fair enough. Final question your, your &ndash; I&rsquo;m looking at your ownership structure and, and seeing you know a
16 percent owner in ARD. I assume that&rsquo;s their successive General Doriot&rsquo;s old American Research and Development operation.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>And a very little information on, on when Textron spun them out it looks like your Mr. (Hughes) is pretty much the who&rsquo;s
on your board already is pretty much the only general partner.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>When they talk about that large holding what are their thoughts? Have you had any deep discussions with them on this position
this major position that they have?</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Well, we of
course need to let ARD speak for themselves. But you know the history is perhaps the best, indication of the future and we are
appreciative of the fact that that money has been patient money and we&rsquo;re also deeply appreciative of the fact that Mr. Hughes
is a very involved and significantly contributing director.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>He is an MIT electrical engineer and a Harvard MBA. He&rsquo;s worked at the Boston Consulting Group, been the acting CEO of
a computer company, and we&rsquo;re just pleased that plays the role he does.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Frank):</TD><TD>So he&rsquo;s an active director and there&rsquo;s no indication that you&rsquo;ve had that they, they&rsquo;re dissatisfied
with that holding.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;That&rsquo;s
correct.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Frank):</TD><TD>Could ask the same question about the other 10 percent holder besides Mr. Bennett, the Norman Weschler of CYD master.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Mr. Weschler is a private investor. Years ago, prior to retiring, he owned a convertible debenture trading entity and, that
entity provided some financing to the company which he elected to convert into equity. He&rsquo;s a passive investor, retired and
occasionally makes contact with the company but I am really not privy to what his plans are.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Frank):</TD><TD>OK good thank you very much.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0">Ralph Norwood: Thank you. Any more questions (Ronnie)?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>Yes, your next question comes from the line of Fred Milligan with Milligan group.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Fred Milligan:&#9;Hi again.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Hi Fred.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Fred Milligan:&#9;Hi when
we reach the promised land of sales of 25 to 30 million what kind of margins will we have relative to what we&rsquo;re doing currently.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Well, Fred,
excellent question. If today let&rsquo;s say order of magnitude we just generated 23 percent if we were to add another $10 million
of revenue, I would say we will add in the order of magnitude of at least $4 million or at least 40 to 50 percent more to gross
margin before we hit another step function.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>So if you said at $20 million, I am doing this off the top of my head, we have four and a half million, to go to $30 million
we have eight million, we&rsquo;d be up in close to 30 percent at $30 million.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Fred Milligan:&#9;That&rsquo;s
pretty good, OK. Let&rsquo;s hope we reach the promised land.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;&#9;Yes,
anymore questions (Ronnie)?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>Yes you have a question from the line of (Philip Glickman) with stockholder.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Hi Phil.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Philip Glickman):&#9;How
are you doing?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Good how are
you?</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Philip Glickman):&#9;I am
great, by the way (Grant) thank you very much for helping me out to get on this call. I just want to say that, I congratulate you
on your fourth quarter. It&rsquo;s been going around recently you know things change real quick and I was a little, getting a little
bearish on this.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>And I am fully convinced now that I am still with you and I am very, very bullish on, on what you said, I don&rsquo;t think
I could add anything else to this but I do have a question as far as the stock that -- the action of your stock.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>I happen to know, I happen to wonder with all this good news and everything and getting on the NASDAQ and which was great.
Have you been contacted at all by the portfolio managers that are interested in the, small cap companies? I mean it&rsquo;s this
news sounds so good and it&rsquo;s so bullish, could you comment on that.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>I know you were talking about this one firm but I, I couldn&rsquo;t get the name of it because my reception here isn&rsquo;t
too good. But has anybody contacted you interested in, in buying stock in your company as an investment.</TD></TR></TABLE>

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<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;&#9;We,
we get lots of calls I would say I get three or four unsolicited calls a day ---- half of them trying to sell me either investment
banking services or investor relations consulting support. But, I think frankly, we are still a little low on the market cap and
our volume in our stock ; even though it is double or triple what it was a year ago, it is still low.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>So the answer is no -- no one&rsquo;s showing a serious interest about buying a block of stock&hellip;</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Philip Glickman):&#9;All
right. I am really surprised&hellip;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Other than, other than our current portfolio and we have, we have a couple&hellip;</TD></TR></TABLE>

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<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Philip Glickman):&#9;Yes,
because I notice that the last couple of days, the last few days you had some volume which is highly unusual with your stock. And
suddenly really you had a big seller come into the market and of course it went down and but that&rsquo;s, that&rsquo;s, that&rsquo;s
what the market is tomorrow it can run up a point or two you know only I mean you really can&rsquo;t tell.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>Especially if someone people start listening to this conference call, I would think that with the, I think that with the, normal
so I just wanted to make that comment to you. I think all the other questions that I did have was answered while I was waiting
to talk to you gentlemen.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;&#9;Thank
you Phil, anymore (Ronnie)?</P>

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<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>Yes, your last question comes from Warren Silver with Wells Fargo Advisors.</TD></TR></TABLE>

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<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Warren Silver:&#9;Good afternoon,
gentlemen. Congratulations for your successful year. Everyone seems to be talking about the railroads in Japan, and we forgot about
the fracking business, and the hydraulic fracking I know was down low with the drilling rate.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>We&rsquo;re using 50 to a 100 sealers in each well, are we prepared to handle an uptime if it ever occurs or is there a price
advantage for still using our sealers over the, over the older methods.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">(Grant):&#9;&#9;Good question.</P>

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<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;The technology and the
market and pricing for this product is all intact and what I mean to say is we remain very bullish that, over time fracking is
here to stay. And although the revenues dwindled to zero in the fourth quarter of last year and began that way this year, as we
speak there&rsquo;s a low level of demand that has returned. With our partner we&rsquo;ve actually continued to do some development
so that we think we have a better product than we did before. This product is a real wild card in the short term.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>We remain committed, absolutely. All the feedback we get on the performance of the product is that it&rsquo;s appropriately
priced, it performs well and, again, a little bit of demand is returned. We know that our customer did have excess inventory last
year that it took them a while to consume but we remained very bullish on it, absolutely.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Warren Silver:&#9;Thank you
very much and again good luck for this coming year.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Thank you.
Any more (Ronnie)?</P>

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<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>No you have no further questions at this time.</TD></TR></TABLE>

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<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Let me thank you for joining us; our time is up so let me just emphasize one or two points as we close. It was only a small
number of years ago that we were borrowing money, we were generating losses and since that very difficult 2012 we&rsquo;ve broadened
our customer base and we&rsquo;ve added breath to our customers and applications.</TD></TR></TABLE>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>One indication of that is that in 2013 our largest customer accounted for 42 percent of sales, and last year our largest customer
accounted for 27 percent of sales. Since that time some of the new product areas that have been introduced include the fracking
spheres, and we&rsquo;ve already talked about the investments in sales and marketing in, in China.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;We do believe that
the foundation is strong and that with the enhancements and focused on sales and marketing this past year and continuing though
this year as we bring on board not only Mark Haft in the armor area, but a new senior level executive in the sales marketing business
development at the corporate level. As a result, we&rsquo;ll be able to move forward more aggressively. In some ways, taking a
long term view, we began with technology, we then spent some years developing our ability to manufacture strengthening operations
and we strengthened our finance organization.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>And we&rsquo;re now focused on sales and marketing and extending that reach worldwide and being able to assimilate new customers
more quickly.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&#9;&#9;This won&rsquo;t happen
overnight but these are all actions that are very real but aren&rsquo;t necessarily visible in our current financial results.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">I also want to invite all
of you if you&rsquo;re interested our annual meeting will be held on Friday April 29th in Boston. Shareholders will be receiving
their proxy documents with those details later in March.</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in"></TD><TD>And as usual, we invite any of you who are in the Boston area to come visit us and see what we do, with that I&rsquo;ll say
good night, and thank you again for joining us.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>This concludes today&rsquo;s conference call you may now disconnect.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin: 0 0 0 1.25in; text-indent: -1.25in">Ralph Norwood:&#9;Thank you
Ronnie.</P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">Operator:</TD><TD>You&rsquo;re welcome have a good evening.</TD></TR></TABLE>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 12pt/18pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 1.25in">(Grant):</TD><TD>Thank you very much.</TD></TR></TABLE>

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