Good afternoon and welcome to the ClearSign First Quarter 2014 Results Conference Call. All participants will be in listen-only mode. (Operator Instructions) After today's presentation there will be an opportunity to ask questions. (Operator Instructions) Before we get started, during the course of this conference call, the Company will be making forward-looking statements. We caution you that any statement that is not a statement of historical fact is a forward-looking statement. This includes any projections of earnings, revenues, cash or other financial statements, any statements about plans, strategies or objective of management for future operations, any statements concerning proposed new product, any statements regarding expectations for the success of our products in the U.S. and international markets; the outcome of product research and development; any statements regarding future economic conditions or performance, statements or belief and any statements of assumptions, underlying any of the foregoing. These statements are based on expectations and assumptions as of the date of this conference call and are subject to numerous risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks are described in the section of today’s press release titled Cautionary Note on forward-looking statements and in the reports we file with the Securities and Exchange Commission. Investors or private investors should read these risks. ClearSign Combustion Corporation assumes no obligation to update these forward-looking statements to reflect future events or actual outcomes and does not intend to do so. Please note, this event is being recorded. I’d now like to turn the conference over to Rick Rutkowski, CEO. Please go ahead.

Thank you very much. Good afternoon, everyone. Thanks for joining us. We are here in Seattle is a rainy spring afternoon, nowadays typical for this time a year. I am going to ask Jim Harmon to take us through the operating results -- financial operating results and then we will get into a recap of what has been a quarter of enormous activity behind the scenes, really setting a stage we think for pretty dam exciting 2014. So Jim, why don't you share with us the results from operations?

Sure, thank you, Rick. So for the quarter we recorded a loss of $1.6 million, which is $300,000 increase over the first quarter of 2013. Our R&D expense went up $150,000 to a little more than $600,000 that was as a result of some increased compensation about $90,000 and about $60,000 of consumables and testing materials from increased testing. On the competition side, we added three new employees in the R&D section in the fourth quarter. So that would account for that. On the G&A side, our expense went up by about $140,000 and it was almost exclusive associated with increased marketing and business development expenditures. We have as most of you know -- we had our register direct offering during the quarter, closed on March 5, where we issued 812,000 shares at $8 a share. So the gross proceed was $6.5 million. Our net cash proceeds was $5.8 million. As a result, at the end of the quarter we have $6.5 million of cash, which is enough cash to hold us into early 2015. Back to you Rick.

Great. Thanks and just a note on the cash estimate that Jim mentioned, that assumes no additional contribution from development contracts or other revenue generating. So we think we are in very good shape relative to our balance sheet and given the level of activity that we see over the next -- the current quarter and the next quarter. I think the second and third quarter of this year are really an important part of what is as I mentioned in our last call are really important transitional time for ClearSign. 2013 again about developing, scaling, demonstrating results, frankly results that exceeded even our own best expectations in terms of performance. 2014 being the year that we partner pilot and otherwise prove out to the marketplace, set the stage for markets, partnering both with OEMs for integration, partnering with companies for distribution and retrofit strategies as well as creating some distribution partnerships where we can sell through those partners into some very, very large markets. As we mentioned here in the press release, this first quarter of this year has been especially important and especially gratifying. Recently earlier in the quarter, we did report that we had achieved an important scale down milestone, which I neglected. Unfortunately, the recap in the press release, but we did show that we could scale down the Duplex and achieve the same kinds of results, single digit NOx submissions and even residential systems. Most recently, we reported a very, very important scale milestone, scaling the technology up to 5 million Btu per hour and I'll give you a sort of a handful of key parameters that are in the most recent press release relating to this, but the key here is to achieve sub-single NOxs kind of how the industry refers to it. 5…

Yes. Thank you. We'll now begin the question-and-answer session. (Operator Instructions) And as mentioned, we do have a question from Jim McIlree with Chardan Capital.

Thank you. Good afternoon.

Hi Jim

Talking about Steam Generator market and (indiscernible) just want to make sure I understand that these are two initiatives for you right now and if that's the case, which do you think is first in terms of generating the license trend in the [long term] (ph).

Your phone was breaking up quite a bit in the early part of the call. I got the later part of what you said, but what were the two segments that -- I think it was two segments you want to compare and contrast.

Yes, you talked about Once Through Steam Generator market and about this heater market and my question was there are two separate initiatives for you.

They are in terms of the market segment that they address. From the standpoint of product development, one of the nice things about this technology is that there is a lot of platform commonality across all of these applications. So the difference between those two from a systems level is that many process heaters would be natural draft and most boilers including once through steam generators have blowers and are either what are called force draft or powered burners. We've shown that we are -- while there are differences in those two types of approaches were more or less different to them. So from a go-to-market strategy standpoint, the timing really just has to do at this point with where we are seeing, that's the greatest pull, but I don't think it's that so much. We have on the OTSG side, we have several guys who are pulling pretty hard and have sights identified. And in fact this recent RFP has kind of a leapfrog characteristic to it with respect to this water tube boiler. So in the world of pilot site demonstrations, that's really about just sort of going as fast as we can, so it's a little bit of a horse race. Obviously where we are being strategic about the reference ability of the systems to very, very high value applications. So we want to get in demonstrate the characteristics that process engineers in the category now correlate directly to the various economic advantages. At the moment, between once through steam generator and refinery process heater it looks very much like the ones through steam generator would be the first of those to actually turn into an agreement and then I think there is a strong likelihood based on at least my current understanding that this large water…

Great. And can you talk a little bit about this RFP in terms of what it is, what's the deliverables, if there are others involved in it? If this is a competitive RFP, time and money you would have to invest in this.

Yes, I don't think it's been put out for competitive bid, but I am pretty certain but I don't know. I think they view this as kind of a unique situation. This comes on the heels of several meetings that we've had with these folks. So the cost associated with it from our perspective is a very manageable number, it's probably a few tens of thousands of dollars. We do believe they will be cost reimbursement, both from the customer as well as the potentially some of the air quality folks in the region up here, but it's brand new, but I think there is a great deal of enthusiasm behind this. so I don't think we are competing that and I think what's kind of interesting and exciting to us is that it's in our backyard, it's a segment that we can demonstrate and it's very, the overlap with the OTSG solution is very significant. So one of the virtues of our technology in particular is that even in a case where we go in and we say, look, we'll put the bill on a pilot installation. It doesn't really cost us a lot of money to do that. Now in most cases there is usually some in kind contribution or the customer will say, well we'll cover the installation cost or we will still win some of our processer engineering time and things of that nature. So it ends up being kind of a shared deal. In other cases, we will get paid and I think paid even substantially for it. So it varies a little bit on a case by case basis and people who are listening to this call, anyway, give it to that guy for free, but the beauty again of the technology is that…

Okay. Great. Thanks a lot.

Thank you.

Thank you. And the next question comes from [John] Investments.

Hi John, how are you?

Good. How are you doing today?

We are doing very well. Thank you.

Start performance has not been recently, I am sure you are well aware of that. My sense is it's the lack of revenue because revenue is coming in a lot later than folks had originally anticipated or you had led them to believe in previous calls, can you share anything with us at all about your expectations when we will start to see revenue booked?

Yes, again the real -- revenue expectation for this year had mostly to do with contracts and I don't know if you were on our previous call, someone asked the question about it and only so much revenue is the driver as the partnerships that people had hoped to form sooner. The capital markets have been pretty messy. Recently the indexes are not telling the full story. If you watch certainly many smaller and micro cap stocks there has been a broad melt down you’ve seen on the news headlines about the rotation away from growth and stocks that have had big runs into others and so on and so forth. So I think there is a number of variables because I don't think the focus has been so much on revenue as it has been on forming these partnerships and getting the validation and endorsement of those partners and there is always a decision we face, right, which is can I do this deal today or if it takes me a day longer, is the deal that much better? I am a large shareholder in this company. I don't like seeing the stock down at all, but I am also focused on where we are headed in terms of value creation, not just this quarter and next quarter, but 10, 12, 20 quarters out. And we are going to live with these long term licensing arrangements for many years. When you start to do the marginal analysis, a 2% difference in royalty rate or 20% difference in annual minimums can make a big difference to the long term picture and so in any negotiation, obviously there is multiple layers of complexity, but the landscape has changed for us in a way that has been we think a very, very…

Can you hear me?

Yes, I can hear you.

Not to toot your horn for you, I think the good news, in fact the great news is that ClearSign can pull all the top 10 the world, the game changing patents, in the world you know.

Well, I appreciate the enthusiasm John, and I think you are right and one of the things that we do in our patent strategy is we say, well gosh, when you have this type of burner in something like a fire tube for example is it still a conventional fire tube boiler? Is it a whole new kind of boiler? Does it enable new kinds of heater designs? Not just new emissions control techniques and so we do what's called patterning down into the application space and we are now at about 150 patents, I guess that's another metric that I neglected to include in the press release update, but you are absolutely right to call attention to it. It's a fundamental part of our strategy and it's fundamental because that's what our partners are valuing. Our partners are valuing the ability to enter the market with disruptive technology that is protected. So they can protect that franchises, they go to market and we and they together can really do very significant things in terms of share. I will tell you something that's really quite interesting. I mentioned there is a perception that the market is larger than they might have thought. It's a factor of four times. So the market is four times larger than what they thought it was and I thought it was pretty large to begin with. I should say we've done analysis, but this is -- again I don't want to sound like I am protesting too much but it's so important clarity. I think there is -- one of my favourite movies is called, The Sniper, and one of the great lines from that movie that I often tell entrepreneurs because there is a tendency to go fast, fast, fast and it's absolutely important to go fast, but the line in the movie is, “slow is smooth and smooth is fast”, and what you really is getting at is we all know is preparation is as important as speed, because preparation is what buys you the momentum, the speed and the intensity that's required to really enter these markets and be as competitive as we should.

...too Rick. The protection that you have through the past I think is good too.

No question, absolutely done. It's fundamental. As I said, that not only to us, but to our partners, that's what they look to us for is to give them that protected position and unique different, highly differentiated position in the market that is protected against competitive threat. So you are absolutely right. I appreciate you calling that to my and everyone’s attention again. Thanks.

Thank you. (Operator Instructions) All right. As there are no more question at the present time, this concludes our question-and-answer session. I would like to turn the conference back over to Rick Rutkowski for any closing remarks.

Yes, again thank you all, not just for coming today. Many of you have been so supportive, so loyal, so patient, so enthusiastic and that's invaluable to us and we've had really great fortune to have some tremendous shareholders one of the things that was great about this last financing is that we got to bring some new institutional shareholders into the mix who we think are very high quality folks who are capable of holding much larger positions over time and we hope to earn that further confidence by executing on the plan. But again, to me personally if you said, what's the most exciting thing that's happened, the fact is we've now demonstrated that we can achieve full industrial scale 5 million Btu per hour plus with performance characteristics that are unprecedented in the category and that deliver really compelling economic value in the segments that we are targeting. So the momentum will continue to build here. The segments that we are targeting continue to be the same ones and I appreciate again your patience in working with us as we work through these negotiations and preparations to get to market with most and the strongest way that we possibly can. Stay tuned, there will be developments coming very soon.

Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. Have a nice day.