Casey Stegman - Stonegate Securities Bill Clough - Interim Chairman of the Board, President, Chief Executive Officer, General Counsel Dan Ford - Chief Financial Officer

Eric Stine - Craig-Hallum Joe Maxa - Dougherty & Company Marco Rodriguez - Stonegate Securities Evan Richert - Sidoti & Company Alex Blanton - Clear Harbor Asset Morgan Frank - Manchester Management

Good day, ladies and gentleman. Thank you for standing by and welcome to the CUI Global Incorporated Q1 2014 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. (Operator Instructions) As a reminder, this conference call is being recorded. I would now like to turn the conference to our host, Mr. Casey Stegman.

Thank you and good morning. Welcome to the CUI Global first quarter earnings conference for 2014. We appreciate you joining us today. With me on the call is Mr. Bill Clough Chief Executive Officer, and Mr. Dan Ford, Chief Financial Officer. The purpose of today’s call is to review the company’s financial results for the first quarter as well as provide you with some additional color on the business going forward. Following management's remarks, the call will be opened up for questions. Many of you have seen the company's press release, which was issued earlier today. If you haven't it can be accessed through the company's website at www.cuiglobal.com. Today, during the course of the presentation, we will be directing your attention to a series of slides. Those slides can be accessed during the call from the link in the press release that went out earlier today or from the investor relations section of the company's website at cuiglobal.com. As a reminder, this call will contain certain forward-looking statements within the meaning of Section 27-A of the Securities Act of 1933 as amended and Section 21-E of the Securities and Exchange Act of 1934 as amended. Such statements are subjects to risks and uncertainties that could cause actual results to vary materially from those projected in the forward-looking statements. The company may experience significant fluctuations in the future operating results due to a number of economic, competitive and other factors including among other things our reliance on third-party manufacturers and suppliers, the government agency budgetary and political constrains, new or increased competition, changes in market demand and the performance or liability of our products. These factors and other could cause operating results to vary significantly from those in prior periods and those projected in forward-looking statements. Additional information with respect to these and other factors which could materially affect the company and its operations are included in certain forms the company has filed with the Securities and Exchange Commission. With that I’d like to introduce Mr. Bill Clough, CEO of CUI. Bill?

Thank you, Casey, and thank you everyone for taking the time to join us on this call today. I’m going to start with a brief overview of the quarter and then I'll hand the call over to Dan to go over the financials. When Dan is done with his remarks, I will follow up with some additional commentary and some of the more promising things we are currently working at CUI and then we will open the call up for Q&A. First things first however, I'd like to say that I was very pleased with our performance for the first quarter 2014, as we recorded $16.9 million in revenue, a 68% increase as compared to the same period last year. Our gross profit margin was up 2% to 41%. Our adjusted EBITDA was $900,000 or $0.04 a share. The Power and Electro-Mechanical segment revenues were $10.8 million in Q1, which was a 12% increase as compared to $9.7 million in the prior year comparable quarter. With the Gas segment, we had roughly $6.1 million in revenue, which is also nice increase over the pro forma revenues from the Gas segment in Q1 2013 of approximately $5 million. As I alluded to in our press release, we had a number of significant enhancements during the first quarter and into the second quarter. I will review those individually after discussion of financials. Each of those announcements were significant and each represents additional progress as we continue to position CUI as a leader in developing new and innovative technologies. With all of that being said, let me turn the microphone over to Dan Ford, our CFO, so that he can run through the numbers in more detail. Dan?

Thank you, Bill. I would like to now give a financial overview of the first quarter 2014. The company's revenues were $16.9 million for the quarter, up 68% from revenues of $10.1 million for first quarter of 2013. The increase in the revenues was attributable to approximate $1.2 million of growth within the Power and Electro-Mechanical segment and the additional of Orbital Gas Systems in Q2 of 2013, which accounts for approximately $6.1 million of revenue this quarter. The cost of the revenue for the quarter was $9.9 million compared with $6.1 million for the quarter ended in 2013. As a percentage of sales, the cost of revenues decreased slightly to 59% as compared to 61% in Q1 2013. EBITDA for the first quarter 2014 was approximately $728,000 or $0.04 per share versus the EBITDA loss of approximately $108,000 or $0.01 loss per share in Q1 2013. The adjusted EBITDA for the first quarter 2014 was $900,000 or $0.04 per share. This compares with an adjusted EBITDA loss of $25,000 in Q1 2013. Gross profit was 41% or $7 million. This was up from 39% or $3.9 million in the prior year comparable quarter. Within the operating segments, the Power and electro-mechanical segment generated a gross profit margin of 41% and the Gas segment generated a 42% gross profit margin for the three months ended. SG&A expenses increased to $6.2 million for the quarter compared to $3.9 million for the same period in 2013. This increase of $2.3 million is primarily the result of the acquisition Orbital Gas Systems Limited in April 2013 and its ongoing operations as well as increases associated with the overall increase in revenues. As a percentage of total revenue, the SG&A has decreased in the first quarter to 37% as compared to 39% in the prior year period. This is a result of efficiencies gained on increased revenues. The company had cash flow used in operating activities of approximately $103,000 during the quarter, compared to cash flow provided by operating activities of approximately $63,000 for the same period 2013. The company had a net loss of $487,918 or $0.02 a share for the quarter ended March 31, 2014 as compared to a net loss of $462,092 or $0.04 a share for the quarter ended March 31, 2013. The loss for the first quarter of 2014 is largely attributable to the non-cash amortization expenses of approximately $785,000 associated with the intangible assets acquired with Orbital Gas Systems in April 2013. The adjusted net income for the quarter was approximately $522,000 or $0.03 per share in 2014 as compared to the loss of approximately $374,000 or $0.03 per share loss in 2013. At as March 31, 2014, CUI Global held cash and cash equivalents at $15.2 million and investments $11.7 million. The company also had 20,620,358 common shares outstanding at March 31, 2014. On May 12th, we announced our plans to amend our previously filed quarterly reports on form 10-Q for the quarter ended June 30, 2013 and September 30, 2013, along with the end report on Form 10-K for the year ended December 31, 2013. These restatements were filed on May 14, 2014. Our new auditor Perkink & Company an independent member of the BDO Seidman Alliance number had identified during their first quarter and transition related procedures what they determined was an inaccurate acquisition accounting for the deferred tax liability and related increase in goodwill upon review of this by ourselves as well as another third-party experts we concurred and we agreed to post a restatement. These restatements filed May 14, 2014 have corrected these errors and had no impact on cash or cash flow. However, the restatement did result in reduction of our net loss, decreasing the net loss for fiscal year 2013 by approximately $816,000 or approximately $0.04 per share. Now, I will turn the call back to Bill.

Thank you, Dan. Before we begin taking questions, let me take a moment to update you on a couple of larger projects we announced last year. In January, we announced a distribution agreement Orbital and Ives Equipment Corporation. That agreement gives Ives an exclusive distribution rights of CUI Global's patented natural gas technology including the gas PT, gas PTI and VE technology in the Northeastern United States. Ives initially purchased two get PT key devices for both, customer demonstration and inventory. Also during the quarter, we completed a similar agreement with Benchmark Instrumentation &^Analytics Services that gives exclusive distribution rights for Canada. Finally, during the second quarter, we announced an exclusive agreement with Yokogawa United Kingdom Limited. That agreement named Orbital as exclusive representatives of Yokogawa's advanced instruments throughout the U.K. and Northern Europe. The agreement is a testament to Orbital's consistent ability to deliver high-quality best-in-class service within budget and on time. The agreement will give us the ability to provide highly competitive bids for any and all large-scale engineering projects incorporating Yokogawa Instrumentation. We are already bidding the first such project to £1 million metering installation for Scotia Gas Networks in Scotland. We believe these agreements represent significant steps in our plan to develop the substantial distribution network for our groundbreaking technology. We closed that this quarter with 30 distributors up from 21 at the end of last year. GasPT sales were strong in the quarter as we received orders with 33 additional units and installed seven new units in the quarter. In late March, our VE-technology was recognized by National Grid as the preferred option for British Natural Gas pipelines. This was significant as National Grid standardized the VE sample system and is both presenting and recommending the technology to the E.U. and Britain as "Best Practice". Additionally, National Grid accepted our proprietary integrated remote information system the IRIS technology as a new method for remotely controlling and monitoring parts of its extensive pipeline transmission system. During the quarter, we continued our discussions with SNAM RETE, the Italian pipeline company and currently have six GasPT2 units in the field testing that are performing quite well. We are optimistic that we will final certification in the near future. For its part SNAM RETE has recently conducted a due diligence visit to our U.K. facilities that have indicated that they were very satisfied with both, our team and its capabilities. Finally, we continue to move forward GE as evidenced by the joint press release regarding incorporation of our IRIS-RTUs, including GE's hardware by National Grid. A press release which has been posted on GE's website and published through GE's social networking system. We are still in negotiations with GE Aero regarding the incorporation of our gas PTI device into their gas turbine fleet, we continued to be quite confident about our ability close that deal as we are the only technology capable providing the real-time data needed to properly operate those extremely valuable machines. On the electronic side, we introduced a new family of digital point of load DC to DC modules that set performance benchmarks and efficiency, power density and transient response to address the rapidly rising power challenges in distributed power architectures. We believe that these products will be a key driver in our future revenue growth and the sales of Power and Electro-Mechanical segment was quite stronger during Q1. In conclusion, let me emphasize our continued commitment to both, employees and our shareholders to grow CUI Global and its subsidiaries in an organized efficient manner by introducing new products attacking new markets, see the opportunities and continue to pursue and partner with some of the largest, most recognized industry leaders in both. The natural gas and electronics market. We believe that partnerships with companies like National Grid, Ericsson, General Electric, SNAM RETE and others along with continued recruiting of distributors like Benchmark Engineering in Canada, Ives Equipment Corporation in the U.S. Digi-Key and Future Electronics can only enhance the credibility of our products, the viability of our technologies and ultimately the value to our shareholders. Thanks to all of you for your continued support of the company. Now, let's open the floor up for questions.

(Operator Instructions). Our first question from Eric Stine of Craig Hallum. Please go ahead. Eric Stine - Craig-Hallum: Hi Dan.

Hey, Eric. Eric Stine - Craig-Hallum: Maybe, we can just start with the distributors. Good progress there to be at 30. Maybe just thoughts what the eventual number is or where the goal stands right now. Then just some commentary on what adding items and in Benchmark has done in terms of visibility going forward, but also just building out their distributor base.

Yeah. Good question. The number that were shooting for still is 40. Those are the numbers that we identified. Initially, if you recall as to the ones that like to have in North America and Europe, and we are still shooting for that 40 and I think we will have those least all the qualified to 40, - some when get involved in frankly weren't what we thought they once we (Inaudible), but I think 40 is the number we are looking for us being the right number for us. Really, what we are doing is setting up the basis for, we believe, a quick ramp up of the sales. Once the devices start getting really implemented by GE's. SNAM RETE and the other companies that were looking at it. Important fact, Ives has already sold several units that are being tested right now by Dominion energy and they had a need for as many as 50 units on their compressor turbines. If we passed the testing that we have start with them, so Ives has being quite a good a partner. As far as the Benchmark is concerned, Benchmark is a Canadian company based at Calgary, has great influence on the TransCanada. We hope TransCanada will be a very good customer. As an example of what they bring to the table, we've already started now certification through Canadian Bureau of Measurement which will allow us to become fiscal monitors up there even though we had been tested by TransCanada through an independent lab and fully passed everything that TransCanada needed to see until you get up there and start working with Canadian company, you really don’t know things like the fact that you need Canadian that Bureau of Measurement certification, so they bring that kind of in-house knowledge and ability to go right to the source and I think that's what we will see with all of our distributors. That is why we believe the distributor system is best system to go with. Eric Stine - Craig-Hallum: Got it. Then just back to Ives quick. I know that one of the opportunities they were pursuing and frankly one of the reasons you added them as a distributor was Kinder Morgan, just an update on that? How that's playing out?

Yes. That's really in Ives hand. I know that they're still in contact with them, but I think that Ives felt that the bigger near-term opportunity was Dominion and they have really focused on that and actually we helped them with that by sending one of our a group of engineers over to us set their machine up for Dominion. I know that they are in talks with that Kinder Morgan, but I don't believe that machine has been installed yet. Eric Stine - Craig-Hallum: Okay. Maybe just turning the Gas PTI, you called up that 33 of that were ordered this quarter. Just any further details, are there any new customers in that number or are there any that you view as a signal as kind of moving towards larger numbers.

Well, I think, the ones that are most exciting to me is that six of the seven that were installed were in this that certification program that SNAM RETE has started. They are having the six have already been place about a month-and-a-half ago actually. In field trials, they are all being monitored by a group of the University of Milan; we are going to be in essence recorded data and preparing an independent report after four months of operation. All six of those are working very, very well. Obviously we made every effort to make sure we install them and made sure they were installed properly, which they were, but our understanding is at once that process is done with the University of Milan, they can then approach their regulator and start ordering devices, so that's probably the most exciting of all. Eric Stine - Craig-Hallum: Got it. Could you say, is there a timeframe you are kind of expecting? It sounds like you think it might be fairly clearly quick in terms of how long that trial goes for?

Yes. Absolutely. They told us four months. If they did, they have about a month-and-a-half coming up on two months, I think it will be two months for 1st of June, so they set up a four months test and expect the University to hit [report] period of month after that, so hopefully they'll hold to that time schedule. Again, I certainly can't promise. Eric Stine - Craig-Hallum: Alright. I get it.

Yes, but that is the time schedule we have been given and I will tell you this, they actually came out with a team and did due diligence at Orbital last week Monday and Tuesday and walked away very, very impressed. They did a deep drive into our engineering capabilities, they looked at what we can do, why we have calibration and their supply chain and we were very impressed by in fact my understanding is that they were quite impressed with what we can do and with our capability. Eric Stine - Craig-Hallum: Got it. In that, the four-month timeframe, I mean, so that would be in the fall. I mean that's still - just thinking about kind of the date early next year or that program needs to be in place. I mean, that would give you sufficient time to satisfy that number if that's how it plays out.

Absolutely. Yes we are gearing up for that numbers. We definitely, we expect that to happen and we are gearing up to move. The moment they give us some indication that they are ready to go, we will be ready to move. Eric Stine - Craig-Hallum: Okay. Last one for me just on the on the power electronics side. That was a nice sequential bounce back in the quarter that sometimes can be the seasonally lowest. Just were there any one-time items in that or is just more underlying strength? Thanks a lot.

You know, I'll tell you, I think, we have talked about this before and I will let Dan to follow-up on this in a moment, but the revenues both, in the contracts side and in the electronics side are going to be lumpy. You are going to see big quarters and you are going to see some quarters that are not quite so big, but generally speaking over the course of the year, you will see steady growth in both, the Electro-Mechanical and in the Gas. Dan, if you are going to follow-up on that a little bit though?

Yes. I will just address the specific part of Eric's question regarding any new customers or one-time things there. Nothing particular stands out in that in the first quarter, may be really had to with customer ordering schedules, manufacturing timelines and those things. The 1.2 million was coming across-the-board growth within that group and they decided the timing for customer orders, our ability to manufacture within those timelines and where those things fall. Eric Stine - Craig-Hallum: Okay. That’s great. Thanks.

Our next question comes from Joe Maxa of Dougherty & Company. Please go ahead. Joe Maxa - Dougherty & Company: Thanks you. I want to ask a little more on the SG&A line. Sequentially, pretty nice uptick, can you give us little color? Is that just primarily related to the increased revenue or did you add headcount where did the extra $1 million come from?

Sure, Joe. The biggest piece of that is in the Q1 of 2013, we did not have Orbital incorporated into the P&L, [April 1], so the biggest portion of that increases is related to Orbital operating. Then with that is also the growth in revenue during the quarter within the Power and Electro-Mechanical about $1 million, so the majority of the increase is related to Orbital acquisition and then a piece of it is just an overall increase pertain to growth on the revenue side. Joe Maxa - Dougherty & Company: Sorry. I was sequentially, so I would imagine. Sequential are the same.

Sorry. Q4? Yes. It has to do with operational growth and growth in revenues is related, so yes. Joe Maxa - Dougherty & Company: Okay. That's a good base number to think about for the rest of the year?

Yes. That would be fair. Joe Maxa - Dougherty & Company: Okay. Also wanted to ask on the gas side, revenue has been relatively flat last three quarters in a row. Do you expect to see some pickup? I am just curious currently you have these organizations, again you had a couple of specialty probe shipped, throw that in with the same question did those ship in the quarter are those more of a Q2 event?

Those shipped in Q2, but I will tell you that one of the things that we have seen in the pure contracts side, the legacy side of the gas business is that this Rio initiative has really did slowdown on National Grid, there are some of the projects they want to get moving on. IRIS is a good example. IRIS is a project that now they have that literally systems that are so antiquated that they have no replacement parts for them, so we expect that to start gearing up now towards the end of the year simply because they're now coming out of all the procedural things they had to do with Rio. They literally had a situation where they were charged with rebidding all of their jobs so that they were able to justify everybody's position and it was it was quite an undertaking for them and I think they really underestimated the amount of the work it would take internally and really set them back project wise, but again I think they have a lot of things on their play right now That they want to start moving out, so why we don't give forecast. I think the National Grid is going to start ramping up over the second half of the year. Joe Maxa - Dougherty & Company: Okay. We'll so we will see more pick up with them in the second half versus next quarter perhaps.

Correct. Joe Maxa - Dougherty & Company: Okay. I'll jump back in the queue. Thanks.

Thanks, Joe.

Our next question comes from Marco Rodriguez from Stonegate Securities. Please go ahead. Marco Rodriguez - Stonegate Securities: Good afternoon, guys. Thanks for taking my questions. I wanted to kind of follow-up on the distribution channel. I am looking for a bit of clarification. I believe on the last call you guys were discussing obtaining a local distributors for the Canadian-type operation, so there was kind of a necessity there, but here you have got Benchmark and is that all you need for TransCanada or do you start to look for somebody more local there?

Now Benchmark is their primary provider of equipment and instrumentation. One of the nice things about Canada is, it's much more Europe. It's really dominated by one player and that's TransCanada, so you can handle most of what you need to do with one distributor. TransCanada is based at Calgary. Benchmark is based at Calgary and so it works out well. I think we talked about this. In Europe, almost without exception, you have single pipeline companies that are controlling entire countries. Unlike the U.S., where you have some 210 different pipeline companies, with literally hundreds of thousands of miles of pipeline to owe a huge geographic area, so you need much more diverse distributor group as opposed to Canada as an example or another example Italy, where you have Socrates that serve SNAM RETE, so Canada will be covered by Benchmark and we are actually quite proud of getting Benchmark, because they are quite respected up there. Marco Rodriguez - Stonegate Securities: Got it. Okay. That's helpful. Then the part in your press releases you had during the quarter in regard to National Grid for IRIS and the VEProbe, maybe you can provide a little more color. Just given the timing on these releases, when you think that they start to develop into a higher order flow if you will?

Absolutely. The question asked last for Joe is the answer to that. This Rio project that they have been involved in, it's an internal project. It's in essence a mandate that they upgrade their entire system for technology which of course is great for us, but as part of that charge there were also charges with reducing internal cost by some 20%, so for them to have to do a bunch of internal processes that had nothing to do with outside vendors us or anyone else, but what did is, it slowed everything down IRIS is a is a great example of that. As the press release indicates, we have done almost 70 units now. We will install all 69 of those units I think sometime next quarter, third quarter. They have as many as 320 more units that they need installed and they have been promising us for weeks now that we will be getting the RFP for that. They haven't gotten it out yet. That's just an example of what's happened because of their internal issues. Those internal issues have now largely resolve themselves and we expect them to start moving forward, not only with IRIS, which is one project that we are quite involved with, but with this implementation of the VE technology throughout their system. They literally are going to be issuing a whitepaper shortly that will recommend both, to all British pipeline companies and to the EU that the VEProbe the standard by which any intrusion to the pipe takes place, so all of those things I think we will starting to develop as the year progresses. Marco Rodriguez - Stonegate Securities: Got it. Then with regard to National Grid on the VEProbe press release. I mean, just kind of curious it obviously specific to VEProbe and not the GasPT. Any kind of color you can provide there?

Sure. Think about it. The VEProbe is a much more broadly applicable device to the system. A good example of that is Statoil is looking at implementing the VEProbe and the GasPT and in their Hammerfest refinery up in Norway. In that particular terminal, they will need four to six GasPTs, which is a great number, but they will need 150 different VEProbe. The reason being that the VEProbe is used any where you insert anything into the pipeline to take a sample, to take a temperature reading, certainly anytime you invade that pipeline any time you stick something into that gas flow it's much safer to use the VE technology, because you prevent the vibration that a standard probe causes, so that's why it's much more broadly applicable. We will sell many more of the devices. I mean, the MSRP is lower, but again you'll sell many more of those devices simply because there are so many more intrusions to the pipeline than there are just analyzers. Marco Rodriguez - Stonegate Securities: Got it. Last quick question and I will jump back in Q2. Coming back here to SNAM RETE, the whitepaper, the independent report the University of Milan is doing, are you getting any insight into what numbers that they are tracking or you are doing that on your own?

Actually, they are tracking it independently. We are tracking it ourselves just in conjunct with them. We have no ability to do effective. We can't in any way. Obviously, touch the machines or touch the data. What they're doing, though is they are tracking the six units that are sitting side-by-side gas chromatograph autographs and what they are tracking for the accuracy. To make sure that there is accurate as the gas chromatograph and obviously they are also checking to make sure that they are durable and if they are going to operate. Again, the nice thing that we are seeing is just as we've seen in other gas, they are actually just as accurate as the gas chromatograph, when the gas chromatograph is working. Across the board, the gas chromatographs are working as they typically do about 84% to 86% of the time, so about 14% to 16% of the time the gas chromatograph is offline, because it needs to be calibrated, it needs carrier gas. It is a very temporal instrument. Our instruments, all six of them, had only been in operation for six or seven weeks, but they have worked 100% of the time as our instrument is designed to do. There has been no downtime, there has been no lag, there is no requirement for the calibration, no requirement for recalibrating gas, so the University of Milan, so far at least are seeing quite good things. Although again, they are keeping their cards pretty close to their chest, they are not going to tell us too much anyway. Marco Rodriguez - Stonegate Securities: Got it. Thanks a lot, guys.

Sure.

Our next question comes from Evan Richert from Sidoti & Company. Please go ahead. Evan Richert – Sidoti & Company: Good afternoon, guys. Just one question on GasPT, follow-up to what you were talking about earlier, any idea what the timeline would look like as far as getting fiscal monitoring certification Canada?

Actually, we think a lot of it is going to depend on, we have a report coming out very shortly from Ofgem in the U.K. It's going to certify the device for fiscal monitoring across the entire a National Grid system, and we are going to use that data to a push through Canada. We think it's going to be relatively simple. We've also got agreement now, or actually we don't have the agreement with Benchmark, - it's again an agreement from TransCanada that they're going to sponsor the certification through Canadian Bureau of Measurement, so I can't tell you the exact timeframe, but I think with the data we have from Ofgem with the sponsorship of TransCanada, it can't take too long. Evan Richert – Sidoti & Company: Okay. Great. That's helpful. I will hope back in the queue. Thanks.

Our next question comes from Alex Clinton from clear harbor asset please go ahead thank you.

Our next question comes from Alex Blanton from Clear Harbor Asset. Please go ahead. Alex Blanton – Clear Harbor Asset: Thank you. I got to turn off the -

There is a technical difficulty, Alex? Alex Blanton – Clear Harbor Asset: I wanted to ask you, I have been curious about something you highlighted Benchmark and Ives and so on, but you have 30 distributors and you haven't said much about the rest of them, so could you just give us a little idea of why that is? I mean, they are much smaller or why do you talk about just a couple of them.

Yes. I think they are just much smaller. For example, we have Progressive Instruments out Texas, which is a nice little operation, but much, much smaller than Ives or Benchmark. The others are - many of them are in Europe. Norsk is in Norway up into Sweden and in that area which again a very reputable firm up there in that area, but I don't think (Inaudible). We have talked a lot about Socrates in Italy and North Africa, but really it's only because Ives and Benchmark were two I think real critical and quite (Inaudible) others that we got. Alex Blanton – Clear Harbor Asset: The other 10 that you, I am cleaning my throat.

You are okay? Alex Blanton – Clear Harbor Asset: You are thinking are there any really good ones in that group that we should be looking forward to?

There are a couple of very prestigious ones that we are talking to, but really I am not at liberty to give you names right now, but yes there are a couple there. If we sign up, there will be a press release again. Alex Blanton – Clear Harbor Asset: On the same topic, are there any that - for some reason that are important in the world that you are not talking with.

The every one that we wanted, we signed. The only ones that we have not followed up with is, ones when we got involved with them, but didn't fit with us, either they didn't have our type of instrumentation, they didn't have the network or the context we felt strong enough or we had someone else who we felt stronger in that area, so no. All the people that we wanted, we have got. Alex Blanton – Clear Harbor Asset: Okay. Now I want to switch to another subject to the follow up and that is that you have the restatement of your quarterly statements, which was actually the material at all in my view and you have already done it. I think you did a day or two after you announced wanted to do it. In meeting the legal language of those announcements, it seemed very dire and was going to take you a long time to restating. In fact, that is not what happened and yet when that was announced, the stock went down 25%. After that announcement almost immediately and it hasn't really recovered a lot, so could you just give us a little color on that. I believe that happened after you switched accounting firms and you switched to a very reputable firm, the largest one in Portland, which has ties to BDO from a very small firm, and they found something they wanted to correct and that's all had happened. Isn't that the case?

It is exactly the case, Alex. Again, I don't want to get into a political discussion about legal notifications of what we need to or not need to do. I would tell you that I worked very hard as did Dan and his team to get out immediately. We did not want to let any grass grow under our feet frankly, because we agree with you. It was not a big deal. However, that being said, we also had to agree with the new order firm that said it did have a material impact although non-cash or cash flow, it did have a material impact of what we reported, but you are absolutely right. We wanted to get it done and get behind us. Now as far as the stock price, I can't. I am not in a position to comment on stock price either up or down. We work very, very hard to bring a lot of value to the shareholders. We work very hard to conduct our business in a way that adds value. On the other hand, there are certainly institutions and others that have certain criteria in their bylaws, whereby if a restatement occurs whether it's good, bad or different, they have to take certain action, so that could have been part of it, but again you have absolutely captured the color completely. It was not a big deal. It was not something that was the intentional on our part certainly and part of it was the fact that we did in fact doing what a lot of people had suggested and that as we retained a much more sophisticated order from who look back at acquisition and I guess the good news is that was the only thing that they really identified that was material. Again, I'll leave it at that. Alex Blanton – Clear Harbor Asset: It was material positive impact?

Yes. Exactly. Yes it was material positive. Dan, do you want to follow-up on anything from that?

No. I think, that's exactly what I would have said and as you noted, we filed and got the restatements done as quickly as we possibly could in order to try and get the real message out there what the true impact was those and we notified as soon as we were confident or had identified the restatement needed to be done, we felt it was appropriate. SEC guidelines to announce that to markets and then we very promptly thereafter got our restatements completed and reissued so, it was a lot of work and then it took we had to work with our former accounts as well as our former audit firm as well, because they were the ones opining on that opinion. In general, your analysis was really spot on. Alex Blanton – Clear Harbor Asset: Excellent color. Thank you.

Our next question comes from Morgan Frank of Manchester Management. Please go ahead. Morgan Frank - Manchester Management: Hey, guys. Good quarter. A couple of questions just to be clear on PT2, there were seven that were recognized for revenue and other 33 that were sold, but not yet in revenues. Is that correct?

That's correct. Can you give us ASP on ones that did sell?

Yes. It vary. The six that went that were installed, the six that were installed for SNAM RETE were the analyzers only. That was 20,000 ASP, and the other one was a at Dominion GasPTI, which I believe was 70,000. It was a gas turbine device. I believe it was 70,000. Morgan Frank - Manchester Management: Got it. Great. Thanks. Of the 73 VEProbes sold, can you give us a sense of what the revenue was there?

Let me look at that. Hold on one second. Yes. The 19 that were probes that were in fact probes only would have ranged in price anywhere from $6,500 to as much as $12,000. I don't have a breakout of that. In sampling systems would have running anywhere from $15,000 as much as $25,000 and the thermal wells are about $6,500 a piece. Morgan Frank - Manchester Management: Got it. Can you give us a little color on what been going on with Emerson, if anything?

It's really early stages. I mean, all I can tell you is we are talking to them and I think we have made this fairly clear. We are talking to them about a solution for CNG compressed natural gas for vehicles where we would be entering the in essence value our energy content of the gas at the pump where the vehicle is actually fueled, but it's in very early stages, so I really have nothing other than that we are still talking with them. Morgan Frank - Manchester Management: Okay. Then were there any IRIS units recognized for revenue in the quarter?

We didn't break that out. There would have been some installed, but I couldn't tell you how many. Morgan Frank - Manchester Management: …completion or are you doing them?

They are under PoC yes percent of completion, so they are under the work in progress, there's some that are still in process right now, but we don't have that specifically broken out for… Morgan Frank - Manchester Management: …breakout yet. Okay. My questions has been answered. Thanks so much.

Okay. Thanks.

(Operator Instructions) Our next question comes from Andrew D`Silva from Merriman Capital. Please go ahead. Andrew D`Silva - Merriman Capital: Good afternoon, guys. Thanks for taking my call, just got a couple of follow-up questions. Should we expect an uptick in SG&A due to the restatement in Q2 or is that your Q1 SG&A run rate, what we should expect going forward?

I will. Yes. The restatement should not affect Q2 SG&A much. Obviously, we have got commodities that tend to occur in regards to that work time related, but overall that's not going to impact SG&A, so the Q1 run rate is a better measure to look at. Andrew D`Silva - Merriman Capital: All right. Then as far as your tax rate going forward, what should we model that at?

The effectively rate for the Q, I believe, is 5.5% and that should be kind of in line with where it will go forward now. That's in regards to primarily our taxes in the U.K. as the U.S. is fairly well sheltered from that loss carry forward. It's [better] on the same level. Today's those are all fully allowed for full valuation allowance on those, so our effective rate is looking about 5.5% for now. Andrew D`Silva - Merriman Capital: Okay. Great. How should we think about National Grid? Are they going to send a request for proposal shortly? Do you have a timeline as far as expectation when bids will become orders or at least you will be guaranteed the contract?

Yes. I can tell you only historically. It's my understanding that their contract process takes anywhere from 90 days to 120 days, so that's still can tell you and I don't know how they will go out with this. I will tell you, they do have a problem with this, because as I mentioned to you, they had several metering stations right now and pumping stations that are running on fumes, if you will, in the sense that they have antiquated systems that have no replacement parts, so if they should have a breakdown, they would be in a real, real difficult situation, so they are aware of that, but I think their general contract timeframe is 90 days to 120 days. Andrew D`Silva - Merriman Capital: Okay. This is kind of a GasPT question, so you installed seven and you have orders for additional 33 units in the first quarter correct?

Correct. Andrew D`Silva - Merriman Capital: For those orders, should we figure all 33 units will be revenue-generating orders or will it be similar to what happened in 2013, where you had 111 placed, only 20 were revenue generators and then some were sell-through related before they could become revenue-generating item?

Yes. All I can tell you is, we are seeing more installations occurring as time goes on and we see the pace picking up, so I can't tell you definitively when we will see revenues on 33 of those units, but I can tell you that the pace is picking up. We see that now, so I think it will be sooner rather than later. Andrew D`Silva - Merriman Capital: But those 33 units, once the orders are received that is not a guarantee of actual revenue in a given quarter?

That is correct. Andrew D`Silva - Merriman Capital: All right. Thanks, guys. That's all have for right now.

Okay. Andrew.

Ladies and gentlemen, we have reached our allotted time for questions. I would now like to turn it back over the Bill Clough for closing remarks.

Thank you, Eric. Just in closing, again, I wanted to thank all of you for your support of the company. I think, there has been some really exciting things happen this last quarter. As we move forward, I think, we will be looking for some developments in the GE relationship. I really do think, we are going to see some movement in SNAM RETE this year. Again as I mentioned, as one or two of these bigger organizations start to develop and implement, these technologies we have now in place are really sophisticated network of distributors who could rapidly take these products to market, so I think we will see growth in that area as well. Again, thanks for everything. We will probably be talking to you sooner, either Dan or I are prepared to, for our second quarter numbers in the next little while, so thanks again everyone. Dan you have any further?

I will just say thank you to everyone for participating on the call and for your continued support. Thank you very much.

Thank you.

Ladies and gentlemen, this does conclude today's conference. Thank you for your time. You may now disconnect. Everyone have a great day.