Patricia N. Egan - CFO and Chief Compliance Officer Douglas W. Jamison - Managing Director, Chairman and CEO Daniel B. Wolfe - Managing Director, President and COO

Anthony Polak - Aegis Capital Corporation Robert Littlehale - J.P. Morgan Sam Rabotski - SER Asset Management

Good day, ladies and gentlemen, and welcome to the Harris & Harris Third Quarter 2015 Shareholder Update 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 be given at that time. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to introduce your host for today's conference, Ms. Patty Egan, CFO. Ms. Egan, you may begin. Patricia N. Egan: Thank you. I'll begin by reading the Safe Harbor statement. This presentation may contain statements of a forward-looking nature relating to future events. Statements contained in this presentation that are forward-looking statements are intended to be made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. These statements reflect the Company's current beliefs and a number of important factors could cause actual results to differ materially from those expressed herein. Please see the Company's annual report on Form 10-K as well as subsequent filings filed with the Securities and Exchange Commission for a more detailed discussion of the risks and uncertainties associated with the Company's business including, but not limited to, the risks and uncertainties associated with venture capital investing and other significant factors that could affect the Company's actual results. Except as otherwise required by federal securities laws, Harris & Harris Group, Inc. undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties. I'll now turn the call over to our CEO, Doug Jamison. Douglas W. Jamison: Thank you, Patty. So thank you all for joining us this morning. Daniel, Patty and I will walk you through a few key events from the third quarter of 2015. In conjunction with the call, we provided a link on the homepage of our Web-site, which you can reach at www.HHVC.com. The link is to a short PowerPoint presentation. You can find it on the homepage of our Web-site under Resources on the right side titled Q3 2015 Shareholder Update Call Presentation Deck. We will be referencing a couple of slides from that presentation today, if you want to take a look at it. I hope everyone had a chance to read our press release issued this past Monday or our letter to shareholders for Q3 2015, also posted on our Web-site. It contains the same information as the press release. Please turn to Slide 3 of the presentation deck from our Web-site if you're looking at it. We've been struggling for the past few years with a paradox. This paradox relates specifically to the fact that we've had some success realizing exits and returns on companies, but we have not seen that success to date translate into increases in our NAV, nor appreciation in our stock price. We have not sold shares of the Company since 2009. We believe, currently, we have the capital resources to support our best and most mature companies through monetization without having to raise additional capital over the next 18 or more months, although we would be in a stronger position if we had additional cash for these companies. We began repurchasing shares of our Company's common stock through open market transactions in the third quarter of 2015 to increase the impact of future potential realization events on the growth of NAV and on shareholder return. In each of the years, 2015 year-to-date, 2014, 2013, 2012 and 2011, we had liquidity events that have returned proceeds to the Company of approximately $9 million, $14.9 million, $31.8 million, $11.9 million and $16.5 million, respectively. As of November 3, we also had an additional $16.4 million in secondary liquidity, excluding discounts for lack of marketability. These were as a result of our current publicly traded portfolio companies. Year to date 2015, as we described in our Q2 letter to shareholders, we sold the remaining assets spun out of Molecular Imprints from its sale to Canon in 2014. We sold our shares in Nantero. SiOnyx reorganized and we received a cash payment and have the potential for future payments. SynGlyco negotiated the acceleration of payments. Not included in the cash number is the successful achievement of a milestone associated with the acquisition of BioVex by Amgen that will yield payment to us of $2.1 million, nor Bridgelux transaction announced in July of 2015 that when closed should bring in additional cash to Harris & Harris Group. Looking to the future, we believe there is significant unrealized value in some of our more mature private companies, particularly in D-Wave Systems, Metabolon, HZO and AgBiome. These companies have not required capital from the public markets. We believe that we currently have sufficient capital on our balance sheet to allow us to be patient and ultimately unlock the unrealized value we believe these companies represent. On the negative side, our work and results to date have not translated into stabilization or growth in NAV. We recognize NAV stabilization and growth is an important metric and that our inability to reverse this trend needs to be addressed with substantive and definitive actions. We are addressing our paradox by taking four steps beginning immediately. First, we need to continue to reduce our net operating loss, which is defined as investment income less our expenses, more significantly and more quickly. By significantly, we mean reducing our net operating loss by approximately 25% to 30% in 2016 to the minimum level at which we believe we can operate a publicly traded business development company in the current regulatory environment. This reduction in net operating loss will permit our shareholders to realize more of the value of our portfolio as it matures in the coming years. Second, we plan to return a much greater portion of future realized gains from maturing investments in the BDC to shareholders in the form of dividends and share repurchases. Third, we intend to focus any new initial investments made by the BDC after January 1, 2016 in companies that have the potential to generate near-term income to offset our operating expenses and potentially generate additional cash flows for shareholders of Harris & Harris Group. And fourth, we will seek to build certain of our current and our future investee companies addressing the precision health and medicine markets as majority-owned subsidiaries or controlled partner companies. Please turn to Slide 4. Daniel B. Wolfe: Thank you, Doug. We wanted to highlight our recent announcement and exciting progress at one of our most significant portfolio companies by value, D-Wave Systems. Yesterday, D-Wave Systems announced that the Los Alamos National Laboratory will acquire and install the latest D-Wave quantum computer, the 1000+ qubit D-Wave 2X system. Los Alamos will lead the collaboration within the Department of Energy and with select university partners to explore the capabilities and applications of quantum annealing technology. This sale follows D-Wave's September 5, 2015 announcement that it has entered into a new agreement covering the installation of a succession of D-Wave Systems for the collaboration among Google, NASA and the Universities Space Research Association. The new agreement enables Google and its partners to keep their D-Wave system at the state-of-the-art for up to seven years, with new generations of D-Wave systems to be installed at NASA Ames as they become available. We are excited to see this continued commercial progress at D-Wave and believe that this progress provides additional validation of the potential for its quantum computers. Please turn to Slide 5 in the presentation deck. We would like to describe why we believe it was important for Adesto Technologies to complete its IPO, even though it resulted in a large decrease in our NAV and will trade in the currently volatile market for micro-capitalization public companies. Adesto completed its IPO on October 26, 2015, priced at $5 per share. As of September 30, 2015, we valued our shares of Adesto at $4.68 per share. At the close of business yesterday, November 11, 2015, Adesto's shares traded at $5.40. Adesto is a developer of ultra-low power non-volatile memory for battery-powered electronics and the Internet of Things. Its products are used by over 500 customers, 59 of whom are large multi-national corporations. If you are interested in learning more about Adesto, please see the company's Web-site at www.adestotech.com and its filings with the Securities and Exchange Commission. Recent validation and positive reception of Adesto's CBRAM technology in mass-produced devices signalled that Adesto needed to scale up its manufacturing capabilities, migrate its process to an advanced foundry, pursue CBRAM licensing, and strengthen its sales efforts to win new accounts. These efforts require additional capital that was not readily available from today's private markets owing to the lack of private market investors interested in semiconductor companies. Even within the public markets, it is difficult to find investors that are knowledgeable in semiconductor investing. Adesto was purported to be the first IPO in almost three years. We have written about this problem previously, most recently in our third quarter 2014 letter to shareholders. To us, it is telling that some of the most important fundamental and underlying technologies necessary to enable the promises of future technology trends, such as the Internet of Things, struggle to be developed because there is an extreme dearth of capital for these enabling technologies. In our opinion, functionality must start catching up to design. We believe that Adesto has a strong foundational business as evidenced by its third quarter financial performance released this morning that included the following highlights. Revenue increased 11.1% year-over-year and 5.1% sequentially to $11.1 million. Gross margin was 45.2% compared to 36.9% in the third quarter of 2014 and 39.6% in the second quarter of 2015. Adjusted EBITDA for the third quarter of 2015 was slightly higher than breakeven, compared to a loss of $1.2 million in the third quarter of 2014 and a loss of $700,000 in the second quarter of 2015. 115 design wins were secured in the first nine months of 2015 compared to 35 for the same period in 2014. Even though the cost of capital was higher than desired, we are excited that Adesto now has the capital required to execute on its business plan. We look forward to the potential for the company to create additional value and have it recognized over time by the public markets. Our interest is in being part of this growth over the coming years. Please turn to Slide 6. We do not believe that our stock price reflects the current or future value of the companies we are a part of building at Harris & Harris Group. When there's such a disconnect in the potential value of our Company and the price reflected in our stock, we believe one of the best investments we can make is in our own stock. In August 2015, our Board of Directors authorized a repurchase of up to $2.5 million of our shares in the open market at prices that may be above or below the net asset value as reported in our most recently published financial statements. To date, we have repurchased 418,184 shares for an aggregate cost of approximately $1 million. We funded these repurchases using the cash the Company has received from the monetization of some of our portfolio companies in 2015. We anticipate that the manner, timing and amount of any additional share repurchases will be determined by our management based upon the evaluation of market conditions, stock price and additional factors in accordance with regulatory requirements. The repurchase program does not require us to acquire any specific number of shares and may be extended, modified or discontinued at any time. Douglas W. Jamison: Thanks Daniel. Looking to our future, our future will build from our past but with the benefit of learning from that past. We've been actively building a set of companies where we have the potential for greater ownership, greater control and greater involvement in these companies. Echopixel, NGX Bio, ORIG3N, Phylagen, ProMuc and TARA Biosystems are examples of these companies. We believe these companies provide us with an opportunity to build value differently than we have historically. These more recent companies, and some of our maturing companies, place us front and center for what we believe will be an attractive opportunity over the next two decades, the transformation of the current healthcare and medical markets by the technologies being developed in precision health, precision medicine. Our current and future efforts are focused on building companies in which these new technologies, or combinations of technologies, are driving the creation of the market for precision health and medicine. We define precision health as a focus on preventative care and well-being at the individual level. It includes not just medical technologies, but digital technologies that permit individuals to take control of their health and well-being at all stages of their lives and especially ahead of the period in their lives when disease becomes more prevalent and even dominant. Our specific expertise is in areas where phenotypic or environmental information is intersecting with genotypic information. Turn to Slide 8. We believe there are four trends that will drive the opportunity in precision health. As the investment banks, Macquarie and Barclays, have indicated in recent reports, there is a general shift towards consumerism in health and healthcare decisions. Second, the movement of digital technologies into the life sciences market is putting far more information at the fingertips of the individual and placing a high value on business models that can translate the power of aggregated data to the individual decision maker. Third, the merging of new genomic data with phenotypic or environmental data will finally provide medically actionable information. And fourth, baby boomers are now entering a period in their lives where disease becomes prevalent, and millennials are digitally savvy and taking control of their healthcare decisions. Both represent very large segments of the population. As Slide 8 illustrates, we believe that Harris & Harris Group is already well positioned building companies in the emerging precision health market. This includes recent advancements in genomics, but our real strength is on the technologies and data that provide phenotypic information beside more traditional genotypic information. Whereas the genotype is the genetic makeup of an organism, the phenotype is how genetic environmental influences interact to create an appearance or behavior. Unlike our more mature companies, we are building and we plan to continue to build precision health and medicine companies as controlled entities. NGX Bio, TARA Biosystems and ProMuc are already controlled entities, and our team works with them very closely. We aim to increase our ownership and control in these companies and a subset of additional companies as well. I will now hand the call off to Patty Egan, our CFO, to discuss the financial statements for the quarter ending September 30, 2015. Patricia N. Egan: Thank you, Doug. I'll be referring to slides 9 and 10 in the presentation deck posted on our Web-site during this section of the call. At September 30, 2015, we had total assets of approximately $94.2 million on our balance sheet. Included in our total assets is our venture capital portfolio which was valued at approximately $71.5 million versus its cost basis of $115.2 million at September 30, 2015. Therefore, as of the end of the third quarter, our venture capital portfolio was in a depreciated state of $43.7 million. We also held $21.4 million in cash and had $5 million in debt outstanding. As of September 30, 2015, our primary and secondary liquidity was $29.8 million. Our net assets at September 30, 2015 were approximately $87 million and our net asset value per share was $2.80. This was a decrease from our net asset value per share of $3.51 at December 31, 2014. Turning to our income statement, for the nine months ended September 30, 2015, we had investment income of approximately $675,000 compared to approximately $374,000 in investment income in 2014. Our total expenses were approximately $5.9 million for the nine months compared with approximately $6.3 million during 2014. These total expense figures include both cash and non-cash based operating expenses such as stock-based compensation. Stock-based compensation has no impact to our NAV. Our total cash base and accrued operating expenses for the nine months ended September 30, 2015 were approximately $5.4 million, as compared with $5.6 million during the comparable period in 2014. This yielded a net operating loss of $5.2 million for the nine months of 2015, which was a decrease compared to our net operating loss of $5.9 million during the comparable period for 2014. I'll now turn the call back over to Doug. Douglas W. Jamison: Thank you, Patty. To conclude, we have discussed the importance of achieving scale multiple times over the previous years. As our Board and management discussed the steps described above, we also considered opportunities to achieve greater scale sooner. We will continue to have such conversations. However, to date we have not found a way to achieve scale without significantly diluting existing shareholders or without giving up potential future value that has not yet been recognized. We are realizing returns in our portfolio, and we believe we will continue to do so. We believe we have companies in our portfolio that can provide significant returns over the coming years, and we will make sure we highlight important events at these companies over the coming quarters. We currently believe we have the capital necessary to realize these returns and generate value for shareholders. We are significantly reducing our expenses in 2016. We are well positioned in the emerging market of precision health and medicine to provide growth to our shareholders into the future. At this time, we would like to open up the lines to any questions. Thank you for listening.

[Operator Instructions] Our first question comes from the line of Tony Polak with Aegis Capital Corporation. Your line is open.

Are any of your private holdings selling in a market of the private holdings markets, and if so, are there any – did you get the valuations from those private market trades or did you do your own independent ones? Daniel B. Wolfe: Tony, this is Daniel. We are not aware of any secondary trades that are going on in any of our current portfolio companies. And so the valuations for those companies are derived according to our traditional valuation procedures. And it involves – as we've talked about historically, many of them involve the use of option pricing modeling which is down to accepted standard within the valuation industry as well as looking at market comparables.

Okay. Are we to assume that there'll be some people leaving the Company since you're going to be reducing your expenses a lot, or is that coming from other places? Douglas W. Jamison: So I think I'm not able at this point to communicate everything that will happen. I think to give you some clarity, we have talked about Alexei and our relationship with AutoTech previously. So that is in the public domain. I think that we have – we touched a little bit on this call – we have a series of companies that we have a larger position in and often times a controlling position in, that we have members of our team that work with intimately. Historically, and this has changed in the 2015 if you look at the income section of our income statement, you've seen that historically we've got no compensation from those companies for all of the work we have done. That has started to change in 2015 and it will change in 2015 to a greater significance as well. So I think some of the reduced net operating loss that you will see will be related to members of our team that work directly and intensively with those companies receiving some sort of compensation from those companies that offsets our expenses. I think that's probably what I'm willing to say at this point in time. So we are able to hold together our team as we want to, but there will certainly be some changes as well.

Could you go over, if you sell some of your holding to just out of 16, what you expect to do with that money in terms of return to shareholders? Douglas W. Jamison: So again, I'm not going to provide all the details, but I think we made the statement that as we go forward – so I'll take it philosophically first, and Tony, you and I have talked about this previously and we've already started taking steps towards that – I think philosophically, one of the problems that have been discussed by many shareholders with us is, we have actually seen some realized returns over the last set of years, some significant ones, and yet our shareholders both saw no cash from them because they were reinvested in the Company and the stock prices continued down. And I think philosophically, our thinking is, there is no reason we should be hitting champagne glasses here because we had a realized gain but our shareholders who own the Company are not tipping those same champagne glasses in seeing the return. So I think there is a bit philosophical change at the Board level that when we have realized gains, we need to provide and give back a portion of that to the shareholders, and we said that will be in the form of either dividends or repurchases, and in 2015 during the third quarter you saw us doing that in repurchases of our shares. That is a trend that we philosophically believe in and that I believe will continue on into the future with the thinking of our current Board.

Okay. In terms of newer investments, do you think there will be less of those because you will be returning more cash to the shareholders? Douglas W. Jamison: So the answer is, yes, probably not because we'll be returning more to shareholders, but certainly because we're returning more to shareholders, that will be less cash that goes on to our balance sheet. I think the real thing is in sort of the steps that I mentioned, just our business model is a BDC. We need to – it's difficult to invest for such a long period of time in these companies. It takes a long time to build them and our shareholders, often they just see value decrease for a period of time, the venture capital J-Curve, before they ever see it increase. We think with the addition of option pricing modeling really becoming a dominant force in our valuations, that is even more prevalent. It's really, really hard for these companies to increase in value and it's really, really easy for them to decrease in value, even if the price per share the company raised money at is actually accretive to their last round. And so, most of our shareholders don't have the timeframe that we have, 5, 10, 12, 15 years to see that, and so I think that we've looked out and we said for new investments we're making in the BDC after January 1 of 2016, they need to be income producing. So you're not going to see us make a series of investments that are going to take 5 or 10 years to invest without seeing some ability to return near-term income. And I think in the short term to answer your question directly, you're going to see less investments at the BDC level, you're going to see us focus a lot more time and attention on the subset of companies that we have a controlling interest, really building them where we can control their outcome, where we can build them in a way that we think is beneficial for both our public model and for our shareholders. And if you see us make some near-term investments at the BDC level over 2016 and 2017, you are really going to see it in – you remember we made some venture debt investments historically that yielded, that actually turned out to be – it was a small amount of money but it turned out to be very, very positive for shareholders from an IRR perspective. You may see type of investments done like that at that level. Daniel, do you have anything to add? Daniel B. Wolfe: No, good [summary] [ph].

Okay, thanks a lot.

Our next question comes from the line of Robert Littlehale with J.P. Morgan. Your line is open.

Just two quick questions. As you have done in past quarters, could you just give us an update in terms of the competitive environment as you see it, especially in the early stage investing arena? And the second question relates to, would precision health include linking certain types of nutrition to specific medical conditions, is that an area of opportunity for you? Douglas W. Jamison: Yes, I can answer both of those questions. So let me start with the first one and then we'll come back to sort of precision health and medicine. And Daniel, I'll start it and then maybe you can add some detail to it. So the environment that we face, it's an interesting environment. I'd be wrong if I said that venture capital environment sort of generally, and what you read in the paper, hasn't been vibrant. It's been very vibrant. I think what we see though, it's been very vibrant to a subset of companies, to a subset of large and growing sort of social media, Internet-dominated companies where you really see a change in markets and industries literally tracing its way all the way back to the onset of the Internet. The other area that it has been very vibrant in is biotech related to drug assets. So not life sciences tools, not the underlying enabling technologies, but drugs, and it's been very vibrant and the public markets have been very vibrant as well. So I think it's important when one talks about the market to be able to bifurcate. The other thing you've seen in the venture capital environment, another trend to read about and think about, and we are interested in these dialogs too if people have different perspectives, is that there is a subset of venture capital firms that have grown very, very large, billion-dollar funds. The $300 million to $400 million sized fund has crashed by about 44% over the last five or six years. And then there is, the Angel and Seed stage has grown, but the Angel and Seed stage is only doing digital, sort of Internet, social media, digital technology investments, because you can't do life sciences investing, energy investing, semiconductor investing from a seed fund in this day and age. So what we have seen is, these very large funds, you see deals, a Series A round being done, Juno Therapeutics, I mean I think the Series A was 120 million, the Series B was like another 200 million. That's really, really difficult for us at Harris & Harris Group. I mean from the onset, you can't get in and get a bid in there and grow and get the valuation, you're a small check in a very large deal, and those are done by a very small subset of the largest funds. They take the financing risk out and they get a lot of money in early. So you're seeing that develop in the field. That's a difficult trend for us. I think the other trend, the last trend I had mentioned that we've talked about is, there are just so few groups investing in the hard size enabling companies that we do. And again, I know a lot of you on the phone, smart people are going to say, then why the heck are you doing it? If you need a 4.0 to graduate from college, it might be easier to do it as an English major than it is to do it as a Physics major, right, and take your 4.0 and learn in life. But these technologies are critical. We have a great team for doing it. I think we have done it well over the last set of years, but this is the Adesto for Internet of Things that Daniel was talking about, like these are some of the life science tools are going to enable the next generation of drug, drug discovery, and that's what we've historically done at Harris & Harris Group and it's harder to find those groups. And it's why we took Adesto public because there was no more private money available because probably the investors that invest in that deal, we were all in it. The other – that universe has dried up over the last set of years. So a little bit long-winded but I would say, venture capital and what we do is still a difficult environment but it's great, we're one of the remaining firms, we have a leadership position in it, we're getting firms at good valuations and one can work from that. We're clearly hindered by this – I mean it's happened in all areas of financial markets. I mean just the stretch in equality has stretched to a very, very few that have a lot, and they do very large investments, very large funds, it's hard for us to participate in that. And then a lot of small seed funds that are like, I mean a lot of them are less than $20 million in capital investing, 50,000 or 75,000 in a deal, and they just don't have the power to invest the next 20 million or 30 million that's going to build the type of companies we have. Daniel, any other thoughts on that before we turn to the second one? Daniel B. Wolfe: No, that says it all. Douglas W. Jamison: Great. As it relates to precision health, the simple answer is, yes. I think we've been at the center both via nanotechnology and via BIOLOGY+ in the technology of all the work being done at the microbiome, the metabolome, epigenetics, genetics and sequencing work, and everything like that, and the more we find that there are things one can do in the field of nutrition, in the field of health, that impact health and ultimately impact disease state as well, and the more we know, the more one can take steps, oftentimes long before disease happens to either a prolonged period of wellness or to hopefully hinder off disease as well. So I think there's a lot of interesting areas. Our main thesis in this area, just so our investors know, is I think it will be a long-term trend. The medical profession will be slow to change. There will be walls that are hit, there will be – people will back up against them. I think there is a huge drive going on in the wellness field now and I think that area will be, you'll be able to gain traction in that far sooner than you will in clinical settings. Yet I think that wellness will move its way into clinical settings over time. So we are very focused on the health side of things using this new information, using the digital tools and the software at our fingertips to get information to people, to drive wellness, and then over time ultimately to drive precision medicine over a longer period of time.

Thank you, Doug. Thanks Daniel.

[Operator Instructions] Our next question comes from the line of Sam Rabotski with SER Asset Management. Your line is open.

The Bridgelux, is that carried at the realizable value based on the transaction or will that be moved up or down when the transaction closes? Douglas W. Jamison: It's approximately what we expect to receive.

Okay. One of the things that has gone, we have spoken about home-runs, we haven't spoken about strikeouts, and I think we really have to think we're in this to make money and we have to sort of try to figure out to maybe make some singles and doubles and not strike out, and do you think your plan going forward will produce more singles and doubles and less strikeouts? Douglas W. Jamison: It's a great question and one that we talk about a lot internally again and a conversation that I'm always interested in the dialog. I mean there's a lot to be said. I want to go back because I just philosophically, and I mean this is a debate we have and a debate that's had across the whole venture capital community, we are early-stage venture investors. I very much agree with Peter Thiel's comment that it's a home-run game. I don't know if I've seen any early-stage venture capital funds over a 10 or 20 year history provide outsized returns and returns to their investors without having a home-run. Now again, you can define what is a home-run, is it more than 5x or does it have to be 10x or more than 10x? But that's what drives the game because there are a lot of strikeouts when you do the early stage. Now the flip of that is, if you are a late-stage fund, or again public market investors, you hope to be past the strikeout stage and you believe you can return money with doubles and triples or singles and doubles. So we will always be looking for home-run, but I want to be careful. A home-run doesn't have to be a billion-dollar company. If we own 30% or 40% of a company worth $300 million or $400 million, that can be a home-run to us as much as like a D-Wave situation where you're going to own less than 5% of a company that could be ultimately worth multiple, multiple billions. And for us, it takes a lot of invested capital to build a company that's got to be worth a lot of billions of dollars. It's very feasible from our past and our history and our recent history of being able to build companies that are worth a few hundred million dollars. So, I just want to say that upfront because we think in terms of return on our capital in doing that. I think where we have been good as a venture capital firm as I've looked out is, a lot of these returns you see, we talked of Molecular Imprints, actually most of their investors in those deals lost money. We made money because of selective choices we made during the investment that allowed us to have returns singles, doubles in some of those companies. So I think, I look across the portfolio over the last, certainly over the last five years, I think what we've shown ourselves capable of doing is generating single, doubles and even a couple of triples. BioVex is still playing out, but BioVex's drug is now on the market by Amgen. We're going to get a milestone payment before the end of the year for $2.1 million. We got an earlier milestone. Because it's now in the market, we are hoping that down the road we may get future milestone payments as well. I think we've done really well on that front. Our problem is, we haven't had the realization of an event that could bring us 7x, 8x, 9x, 10x our return. I think our new strategy of owning more of these companies, the idea there is we really lose out when the companies need to raise $50 million or $100 million to be successful, and so these are opportunities where with the capital we have, we can maintain a controlling position and we can impact their outcome at an outcome level that gives us the return we need to be successful. So the market will consider them perhaps singles and doubles by what they are actually sold at, but because our ownership won't be 5% or 6% but will be 20%, 25%, 30%, they'll be very impactful for us. Dan, do you have any other thoughts on that? Daniel B. Wolfe: No. Agreed.

Thank you, Doug. I think we're really in the business to make a profit and we have to really consider when we look at Cambrios Technologies, Cobalt and various other investments, we have to figure out how we can make a profit, not on every investment, we look at Mersana, Nano, and so that the shareholders and the offices of the company can stay in the same way, [not to reach an] [ph] order to be making a salary, et cetera, you have to be making a profit. So that's really what my thoughts are. I mean the Capital Southwest, the Safeguard Scientifics, Ren Capital, various other companies that have been doing this for a number of years, they have figured it out, and Harris has to figure it out, and hopefully you can so that the shareholders can reap the – offset the losses on these various investments and just get some… Douglas W. Jamison: We agree full-heartedly, Sam. We've been trying to do that, we'll continue to do that, we've monetized positions in things like Nantero this year that I think are representative of that. And also the one thing I didn't mentioned, and Tony Polak had brought it up earlier, but if you look at our investments going forward, the whole concept there is that. So we believe we have the portfolio with some home runs in it. We are making the changes now on expense and everything like that because it's just, it's been too long that our shareholders haven't seen that value. We want to get it set up as these come through so they see more of that value. And if you look at our new investments going forward in the BDC that we talked about, those will be income producing investments. The whole idea there is, we are making money right off the back. We're not investing and telling you, there is a wonderful promise and then talking about that promise for five or seven years, and you are still wondering if it's going to be a strikeout or if that promise is there. So we couldn't agree more with what you are saying. I don't want to lose touches. There are some really good companies in this portfolio we believe and they are taking time, and they're not going to public markets because they have access to capital. And we believe over time as they play out, they are going to produce the returns we look back. But we realize it's been a hard trip for the shareholders and we realize we need to maximize more of that return, and hence we are making the changes we are making.

I agree with you, and good luck. Hopefully we achieve what you expect to achieve.

This concludes today's Q&A session. I would like to turn the call back over to Doug Jamison, CEO, for closing remarks. Douglas W. Jamison: So first of all, thank you all for joining this call. We're always available for questions and everything like that around our thinking. We tried to be very clear in the press release we put out and in our shareholder letter the changes that we are making. We are optimistic about the future of some of these portfolio companies. I think change is always difficult but usually you look back at change and you say, it's good and it's the right direction, and we think we have our hands on that pulse. I'd like to just end with one story, and it's a story that's ongoing but it's good as we think about the holidays coming up I guess. So we are clearly approaching the holidays and sort of the spirit of humanity that the holidays entail. And so I want to share this story. It talks about – we're not investors at Harris & Harris Group, we build companies. It's like building families. And they go up and down but you want to see them maintain their integrity. And over the past year, we had a really interesting experience and I think our portfolio company really addressed it well, and it made me proud to be an investor in that company and proud to be at Harris & Harris Group, even though it was during a very difficult situation for this company. So one of our portfolio companies, it had a great fantastic year of growth in 2014, it was hit hard by difficult economic conditions in 2015. Now the company demonstrated grit through the difficult year where one-time partners started to become legal adversaries. And projects in their sector because of the economic conditions in this sector, they started getting canceled, existing contracts sort of reverted to the course to be challenged, not in the business world but the legal world. And during this time, our portfolio company and one of its one-time partners became embroiled in a legal rendering relating to a third party contract. And on the evening of the day before both parties were to show up in court, the son of the CEO of our portfolio company's one-time partner and now adversary died in an automobile accident. As you can imagine, the family was devastated. Our portfolio company reached out to the CEO's family sending condolences and a gift to the family, putting aside business differences as previously the company has been both friends and partners. The letter back from the CEO is what I want to share because it was inspirational. So this is coming back from the CEO of the at-that-time adversary then. And the CEO wrote back, I am a bit overwhelmed at your kindness, and I'm using this as a teaching moment for my kids. Here we are adversaries in court business to some degree, but even so you are being generous with your kindness at this time. We are bound as humans on this Earth and your kindness demonstrates how some people are able to see the differences between 'work' and 'humanity'. We at Harris & Harris Group are proud to be involved with the portfolio of a company that understands integrity and humanity, reminds me of something our Founder, Charlie Harris, used to say, that you can't do good business with bad people. We consider ourselves builders of companies at Harris & Harris Group, not investors. Building companies is like building families. Integrity is at their core. Humanity is a part of this process. Working with good people is critical and learning from our colleagues is done at all levels of the leadership. We have not yet achieved the results we think are locked up in our companies. We are working intelligently we believe and without rest to unlock this value for our shareholders. But we have an excellent team internally and in the managements of the companies we are working with to build value. I am proud and humbled by our team for their efforts, for their intelligence, for their perseverance, and because these colleagues are representatives of the same humanity we saw practiced by one of our portfolio companies. As we enter the holiday season, I just thought this would be an interesting story to tell. Have a wonderful holiday season and we hope to continue building value for Harris & Harris Group and seeing that recognized into 2016. Thank you.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program and you may all disconnect. Everyone have a great day.