Good day, ladies and gentlemen and welcome to the Third Quarter 2013 Allied Motion Technologies Incorporated Earnings Conference Call. My name is Cristal and I will be your operator for today. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session. (Operator Instructions) I will now like to turn the conference over to host today Ms. Sue Chiarmonte, Vice President and Secretary and Treasurer. Please proceed.

Thank you, Operator. Welcome to Allied Motion’s conference call to discuss the quarter ended September 30, 2013 and the pro forma information from the Globe Motors acquisition. Thank you for joining on the call. We distributed two press releases yesterday and copies are available on our website at www.alliedmotion.com. Today’s call is being broadcast live on the Internet and will be available for replay immediately after the call for 90 days. To access the Internet broadcast or replay, go to the company’s website click on the investor relations page and then click on the webcast icon. As a reminder, please note the Safe Harbor statements included in the press releases also apply to our comments made on the conference call. I will now turn the call over to Dick Warzala, President and CEO of Allied Motion Technologies.

Thank you, Sue, and welcome everyone to our third quarter 2013 conference call. Here is the plan for today’s call. I will begin with a brief review of the results for the third quarter and year-to-date 2013 and I will turn the call over to Rob Maida, our CFO, who will provide a detailed financial review for both the quarter and the year. After Rob returns the call to me, we would normally go behind the numbers to provide you with some insight as to the activities and opportunities for the future. For this quarter we will deviate from net process and discuss the Globe Motors acquisition. First I will summarize the unaudited combined Allied Motion and Globe results for the year 2012 and the nine months ended September 30, 2013. And then, I’ll provide you with a brief update on the integration plans and the synergies we will pursue before opening the mics for questions. Let’s begin with an overview of the results for the third quarter and for the year 2013. Note that I will be presenting adjusted figures while Rob will provide you with both reported and adjusted for comparison purposes. Sales in the quarter increased to $24.9 million from $24.3 million in quarter 3 of 2013 and decreased year-to-date to $75.4 million compared to $78 million in the same period of 2012. Excluding all non-recurring items adjusted net income for the quarter decreased to a $1,239,000 or $0.14 a share compared to a $1,321,000 or $0.15 a share in the third quarter of 2012. For the year adjusted net income decreased to $3,611,000 or $0.41 a share compared to $4,252,000 or $0.49 a share last year. With regard to our bookings, I would like to remind everyone that our path practice was to book and report all orders in the period they were received including blanket orders which could cover anywhere from 12 to 24 months of demand. Beginning in 2013, we no longer include the full value of the blanket orders one received and only report them as bookings when they’re released the production. We will allow for direct comparison year-over-year, I’ll report the numbers including blanket orders. Therefore blanket orders for the third quarter of 2013 was $30.2 million versus $20.2 million in the third quarter of 2012. Order year-to-date 2013 were $82 million versus $66.9 million in 2012. On a like basis, this means that orders for 2013 year-to-date have increased by 23% over 2012 year-to-date. Comparing our served markets this is regards to shipments year-to-date 2013 to the same periods of 2012 our industrial market was up while medical, vehicle, aerospace and defense and our electronics markets were down. Now, I will turn the call over to Rob Maida who will provide a detailed review of the financial results and then I will be back for the Globe Motor’s acquisition discussion before we open the mics for questions, Rob.

Thank you, Dick. As was reflected in our press release that was put out last evening, the company achieved net income of $833,000 or $0.09 per diluted share for the quarter ended September 30, 2013, compared to net income of $1,321,000 or $0.15 per diluted share for the same period last year. The results for the quarter include $596,000 or $406,000 net of tax of new business development expense in conjunction with the acquisition of Globe Motors that was completed October 18. Results for the quarter ended September 30 and year-to-date for both years will be presented as adjusted for non-recurring charges to provide a better indication of performance associated with operating results. Excluding the non-recurring charge in the current quarter the company achieved adjusted net income of $1,239,000 or $0.14 per diluted share compared to $1,321,000 or $0.15 per diluted share for the same period last year. Revenues were $24.9 million compared to $24.3 million last year. This is an increase of 2.3% with 0.5% or 126,000 of the increase due to an increase in sales volume and 1.8% or $434,000 due to a favorable currency change where the dollar weakened against the Euro and Swedish Krona. The 2.3% increase in revenues reflects a 13% increase in sales to non U.S. customers offset by a 5.4% decrease in sales to U.S. customers. Bookings for the quarter ended September 30, 2013 were $25 million compared to $20.2 million last year as Dick previously discussed beginning in 2013 we no longer include the full value of blanket purchase orders when received from customers and only report them as bookings when they are released to production. To ensure an accurate comparison we will present the bookings and backlog through our 2013 same manner as the prior year. Therefore using prior methodology booking…

Thank you, Rob. I will now provide you with the combined Allied Motion and Globe Motors unaudited pro forma results for the year 2012 and a nine months period ended September 30, 2013. Before we start and to ensure clarity of what was presented in the press release and what is being reviewed during this conference call, I will repeat the conditions under which the pro forma results were provided. The pro forma financial metrics we provided assumed that the acquisition of Globe Motors took place at the beginning of the comparison period, note that Allied Motion will provide audited financial statements for Globe Motors on or before January 3, 2014 in an amendment to its Form 8-K reporting the completion of the acquisition of Globe Motors. That Form 8-K amendment will also contain pro forma consolidated financial statements. If as a result of the audit of the historical financial statements of Globe Motors, the financial information used to prepare the pro forma metric changes, the pro forma financial statements contained in the amendment of the Form 8-K may differ from the information disclosed in the press release. Pro forma information may not be indicative of the results that actually would have occurred if the acquisition had occurred on the dates indicated or which may be obtained in the future. But the Globe assets and liabilities have been measured at their estimated fair values at the date of the acquisition. Differences between the estimated fair values and the final acquisition accounting may occur which may have an impact on the unaudited pro forma information provided. So I think just to put it in perspective is that as the press release stated and as we stated that we felt it was important to let you know the relative impact of the…

(Operator Instructions) Our first question comes from the line of Jeff Geygan with Milwaukee Private Wealth Management. Please proceed. Jeff Geygan – Milwaukee Private Wealth Management: Good morning. Thanks for your time today. Couple of questions. Can you add a little bit of color to the delta in your international sales?

Sure Jeff. Are you talking about the international sales of Allied alone or what we would expect in the future with addition of Globe? Jeff Geygan – Milwaukee Private Wealth Management: Actually thanks for clarifying. As reported in your quarterly release, the increase in change in international sales but that will segway into the potential synergistic impact with the Globe acquisition?

Okay. I will let Rob. He can go ahead and he will address the questions on sales that we have currently.

The sales by geography that we have currently, I did talk a little bit about the change in sales in quarter and year-to-date. Currently the total sales from our USTUs for the quarter amounts to about approximately $14 million and sales from our [ONTUs] amounted to $11 million. That will probably change by about 30% adding Globe into that picture for foreign sales an increase of 30% to be clear by adding Globe into that picture in the future. Does that answer the question? Jeff Geygan – Milwaukee Private Wealth Management: Yes, it does but I think it's no worthy how relatively strong increase in organic goals international sales?

You are absolutely right. I mean we did have strong, very strong performance in our foreign sales this year in the quarter I think, I may have mentioned this in my response but I think our sales to foreign customers was up approximately 13% or $1.3 million in the quarter and again I think that was strong performance out of our Europe and it should be noted that the European economy in the third quarter actually came out of fixed rate quarters of negative growth. So we were very well pleased with what we saw in organic growth in the quarter from our foreign TU and again Globe will only add to that picture and I think I can probably point to like I said about 30% growth in what we expect out of our foreign TUs.

To clarify what Rob is saying is the 30% growth in the foreign TUs what the Globe has about 30% of their sales as expected amount to foreign or international sales. So when you add that together, that’s what we are talking about the 30% growth. Jeff Geygan – Milwaukee Private Wealth Management: All right. I appreciate it and secondly it's clear from the pro forma that your margin on the Globe revs is superior to the legacy Allied Motion, so on its face, if you said this was an accretive acquisition case made. However, it sounds like there are other synergistic elements to this acquisition based upon your narrative recently that may not really be reflected in just the pro forma. If that’s true, can you state that it is and how as shareholders will that be evidence financially at either gross operating or net margin on a forward basis. So what should we expect as we analyze your business in the future?

Well first of all, I think if we address the question I will saying that you have to look at the pro formas and you have to there were acquisition cost that were shown in the combined columns. So Allied results for example showing $0.30 a share generated nine months for 2013, if you took out all the cost that were associated with the onetime cost with the acquisition so forth, it would have Allied earnings would have been $0.41 a share. So that $0.11 a share rolled into because of the acquisition that combined amount. Right so I think just to be clear on that. The other thing is to talk about the margins, the margins from both companies are about the same. And if you look at the margins that Allied has generated in the past and the Globe generates, they are about the same. It's the combination of the two the ability to once you cross over those break even cost, I think what you will see on a gross basis that that’s what the margins will be about the same. Are the synergies goal, as I mentioned to you that those are pro formas, those are actual, no synergies built in. that is exactly what both companies the performance generated by both companies added together, taken into consideration all of the cost of the acquisition taken in consideration all the interest cost and debt cost that we were going to face, the amortization cost with the acquisition is showing you that it was we said accretive as you can tell it was very accretive in comparison to because accretive come in one set more per share and that isn’t the case of this acquisition. So we didn’t build in synergies. And on a go forward basis, as I said, we didn’t – we haven’t presented numbers to you. We don’t really give guidance in terms of the future and that still hasn’t changed. So I think unfortunately for you as a shareholder trying to determine how much of an impact that could have you don’t have a direct way to do that and we are not providing you with a direct way to do that all we are telling you is that there is more to it than the number show themselves. Jeff Geygan – Milwaukee Private Wealth Management: Fair enough. I appreciate it. But I think it's safe to assume, your gross margin may constant but if we’re going to see in delta in your financials it will be neither level or operating level where those some synergies past through?

Absolutely correct. Jeff Geygan – Milwaukee Private Wealth Management: Okay. Final question. I will jump out of the queue here. You didn’t present any balance sheet pro forma. I think your original release said you are buying this for $90 million, no cash, no debt, will you be offering a balance sheet or can you give us a just a sense of the change in the complexion of your balance sheet post acquisition?

We will provide the pro forma statements when we file the 8-K on or before January 3, we did not include them in this press release I think this press release was really geared to provide the shareholders with the creativeness of the combination, but we will certainly to address your point pro forma balance sheet will be provided when we do file the 8-K. Jeff Geygan – Milwaukee Private Wealth Management: All right, thank you gentlemen. Congratulations, it’s a very exciting development.

Thank you very much.

Thank you. Jeff Geygan – Milwaukee Private Wealth Management: Sure.

Our next question comes from the line of Charles Charles Neuhauser with Mainwall Investment Management. Please proceed. Charles Neuhauser – Mainwall Investment Management: Good morning. I was actually going to ask the same question about how this acquisition was financed, I mean can you just tell us and presumably have the borrow certain amount of money how what the terms were and that sort of things.

Sure. I think there is several questions we can certainly answer those as far as the debt structure itself there are as you know that in terms of the complexity of a deal of this sort when the borrowing and we are looking at the lending capacity of the company and what we are capable of borrowing we had the senior debt, we had a revolver which is at the same senior debt levels and we had mezzanine debt and as the whole transaction came together I think ultimately what ended up was that the mezzanine debt was shown in when we filed the acquisition the information on the financing that F14 in a 0.5% and it’s interest only that we have to pay and after three years we can pay that debt off. So $30 million of our debt is at that rate, the senior debt which was $50 million for the term and $15 million for the revolver is at a much lower rate and I know Rob can probably give you some numbers there and also we know as part of the agreement we did hedge cap of the senior debt which was part of the agreement so we have locked in a rate for the future, so and I think if you look at the combined debt itself we can give you a feel you take $30 million at 14.5% you take the remainder at below 3.5% okay and that’s really the average borrowing rate that we had. I think in addition to that Rob mentioned cash that we had cash on hand and we did use some of our cash in the deal, okay. He also mentioned that our cash balance at the end of September 30, and he gave you some actual numbers, I think we also must point out is that we did pay some of the acquisition cost directly out of cash that we had on hand, so the cash on hand balance included even though we improved it also included in old months that were paid to transaction fees and development fees there. So, I think maybe Rob you might want to add some more colors on that if to help Charles to understand this.

Sure. As Dick mentioned to your point Charles low color around the borrowing. Dick mentioned we had a $50 million term loan outstanding and a $30 million mezzanine level debt structure. I will give you a little bit of flavor here as to the interest rates on each year we’re talking about. Dick did mention that on the junior level or the mezzanine debt that carried a fixed rate of 14.5% annually. To give you a flavor on the term debt, we’re carrying 50% of that at LIBOR plus a spread and 50% we’ve hedged in fixed rate so to give you an idea currently under one month LIBOR contract on 50% of the debt, term debt that’s not hedged we’re looking at about currently somewhere around 17 basis points. Charles Neuhauser – Mainwall Investment Management: What was the total debt percentage be for that one month, 17 basis points so what is the rate that we have going in here?

With the spread, I’m sorry.

Yes, with the spread.

So, it’s about 2.7% in total Charles and that 50% we did fix a 50% of the debt on the term and that came in at about a 112 basis points plus a spread. So, net portion currently we’re looking at about 3.6% for portion of the debt. And then as mentioned previously the mezzanine debt carries the fixed rate at 14.5. So all in on an weighted average basis we’re looking at approximately 7% weighted average base where we’re getting about 7% interest expense or interest rate I should say.

Thanks. So the mezzanine is your stuck with that to be blunt for three years and then you can refinance that presumably?

Correct, correct.

Was there any sort of equity aspect of this deal like stock options or any kind of incentive plan that might increase in shares going forward?

Yes. First half there was no equity provided to the mezz lenders so there were no dilution for the shareholders in that regard. Within the company there were – there is a stock long term incentive program that did kick in based upon our if you go to the last proxy what you would have noticed is that the board had put in place a five-year growth number for the company and the idea was that in looking historically back at several companies in our marketplace that size did create shareholder value, it was very important and at all our programs within the company we’re geared more towards short term performance, year-over-year increases in performance and we had really failed to put a program in place that looked at well the real value is going to be created by increase in the top line. So there was program put in place and for this year for the long term incentive program as I said was a five year program, probably approximately 80% of that will kick in based upon the acquisition of Globe that will be approximately 250,000 share increase within the company for that long term incentive program.

Okay, thanks. You may have mentioned this, I mean, all that numbers are planned around so I apologize if I missed it, but as far as cash generation might look over the next couple of years, do you have any feel for the capital investment, capital spending prospects say next year for example? Obviously the company is lot larger what’s the thought as to what the capital investment might be versus depreciation and amortization which of course will change meaningfully also?

Sure. And of course I think you are going to appreciate that the banks looked at this very closely as well as the mezz lenders and I think one of the statements that the lead bank, Bank of America, they basically partnered with HSBC and we do expect that there will be syndication where someone else another bank will put some money into the deal also so that we have the ability to if we need to even get more debt if there was – if the right situation occurred. In terms of the capital expending, those were numbers that we provided to the bank and I will -- to the banks and we built into the agreement now that Rob clarified those numbers but there was two portions I mean certainly it was growth capital and there was maintenance capital and we really focused on growth capital. Rob what were the numbers that we built into the agreements that we were allowed to do?

Yes, the agreements do allow for growth overtime Charles, and the agreements I believe if numbers are serving me correctly I believe that we are looking at over the next three year period of those limits being as high as $7 million annually for growth capital exactly. So hopefully that answers the question that you asked.

That’s what built into the models. So that’s built in the models to allow us to do CapEx growth CapEx as Rob mentioned up to $7 million in one year. It does change a little bit by the years and just to put in perspective I think through the nine months of Allied we have little over $2 million in capital and historically we have run in those ranges over the last 3-4 years. So I think keep that in perspective there is room for us and we are also, I think the banks certainly indicated their willingness to cooperate with us. We have a project that we can demonstrate growth potential that’s why having more capacity available they are certainly willing to work with us. This two companies generate very good cash flow and we do expect that we can pay the debt down fairly quickly here. So I think that’s all part of the process that strong cash flow and we can de-lever very quickly here up front. Charles Neuhauser – Mainwall Investment Management: Yes, now and I don’t misinterpret the thrust of my questions, I am sure you have thought true on this and historically one of the attractions of the company has been the ability to pay that debt and grow as you demonstrated. So I am sure that came into the equation but again I just wanted to get better feel for the specifics of the numbers but we are dealing with here. So far so good certainly with those appear that this is a very beneficial acquisition and I look forward to watching it developed. Thanks again.

Thank you Charles

Our next question comes from the line of [Bill Sodhi] with GAMCO, please proceed.

Yes, hi, just couple of questions. So year-to-date 2013 the Allied Motion adjusted EBITDA margin of about 9% and Globe about 17% could you talk about the difference there please?

I think I will just mention something quickly to you and then Rob can fill in some of the details as we mentioned the Allied numbers do include the transaction cost that we have incurred for far this year. So that’s we go to the adjusted. So I think Rob if you can maybe expand upon, I got your question correct Bill?

Yes, I thought the adjusted adjusts for some of those.

It does.

Okay. So adjusted that’s obviously a huge difference in the core business. Could you just give me some comments on that?

Well I think one comment that can certainly be made is early in the questions I believe that it was addressed on a gross margin basis, the two companies looked very similar. So most of the differences are in the operating expense side of the transaction. So I think to give you a little color there that’s where the savings or that’s where the true difference lies below the gross margin line.

Yes.

Is the company of Allied is several different technology units and Dick had talked about the growth in the past with acquisitions several different technology units carrying operating expenses versus Globe as a single entity and a structure that doesn’t have a lot of those duplicated expenses. Hopefully that gives you a little bit more color as to where the difference truly lies.

Is the 9% for Allied, the type of margin is that what we should look at or do you think you can do better than this?

We always think we can do better. We have done better in the past. So I think we are not satisfied with that and certainly I would expect us to be able to do better than that.

All right. Thank you.

Okay. Thank you.

Our next question comes from the line of [Michael McCroskey] with [Indiscernible] Securities. Please proceed.

How are you gentlemen doing?

Good Michael. How are you?

I am doing fine. I feel a lot better now. I have got to admit when I first read through that thing, I am sitting here scratching my head at the 14% now I understand perfectly. Zero in some of this that’s being asked before it appears your depreciation schedules are vastly different. That’s how it come up what are we looking at there is as far as what the heck they are depreciating or amortizing so much more than you are, I think that’s where everybody is trying to match these numbers that’s where it seems to be at. What can you tell me about that?

Very good question. And again I will start out and then as usual Rob will correct me if I am not stating it correctly here. Globe has made in the one of very attractive element of Globe is that I didn’t mention this but maybe should have mentioned this, people have asked us why generate the cash they were profitable, why were they for sale? It was a company that Saffron has about $15 billion annually in sales and this was his only motion company and it really didn’t fit their business models. So as they were looking at and they have done some other things to clean up the company, the company was put up for sale. We actually with our past knowledge of Globe we approached the parent company directly and we were given the opportunity to look at the business fortunate for us. Now during that time as I mentioned, Globe was profitable, well run and they would allow to make investment within the company. And that was the very positive thing. So therefore you can sit there and say, that Saffron allow them to continue to grow and to expand and open up some new markets and made some significant investments in capital and we are the beneficiary of that. That was done, prior to us buying, it was continued even during the acquisition process where there were some new programs coming on line with Globe and the investments there the capital investments, the working capital as well as the capital equipment that was put in place and that’s where you see some of the high depreciation. It was also of course with the investment there was expected returns. And fortunate for us, they were deep pockets there that allowed that made some very significant investments in the company and I believe we will be the beneficiary of it in the future. Rob anything to add there?

How is that going to affect your – is there any concern with CapEx increases I mean I think you have been running around to me and I think mentioned?

No, we don’t – we don’t have any concerns CapEx now. Again as I mentioned, I think the Globe team to be perfectly blunt about it would probably have some concerns because there were deep pockets that can go to before. We have had discussions about this. This is now along with the pluses and the benefits and the synergies we talked about I mean there is the requirement that we are going to have to look at CapEx and certainly the ones that are the most beneficial will rise to the top but that doesn’t mean and that’s where the banks come into play here. That doesn’t mean that if another substantial opportunity opens up for us in the future, we have a strong business case work that we can't go get that money. So we, as Rob has mentioned it's where the new capital investment, not maintenance capital would be I think as he mentions it's about $20 million over the next three years and we see that as being enough to allow us to continue to grow and expand where we feel necessary, we feel the opportunities are. So that money is built in to the model.

Okay. And --

You said almost catching your head, yes it is for real.

I have got another experience for you guys to understand this, that’s one constantly amazed and fascinated Dick, this has just been tremendous to watch. don’t get mad at me for person, can you at least give feel for what your alls internal, I know you have said twice, you don’t want to flush it out more but can you at least say what your internal general goal is I mean is it over the next two or three years to hold these numbers or are you I mean what is it you all internally expect of your sales as far as the pushing these numbers over the current form is and that also segways into it looks like Globe even accelerated from 2012 to 2013, Rob obviously been in this acquisition mode and some transitions mode but I might not reading these numbers right, Globe have better 2013 and they even had it in 2012?

You heard them right.

Now where are your expectation, I mean I know you said things for yourselves and I know you don’t want to quantify it but can you at least look we can hold these for a couple of years and get this all straightened out. Can you give us some sort of feel for what we should expect to be looking for as you are moving forward just as a general trend no numbers?

Sure. What I will tell you is this is where we go back to the strategy. What part of the process here in the integration process is we would be very careful upfront. We mentioned that we have got two well run companies. They are not broke. There is no immediate need to go in and start changing things. So our process here is going through and getting to know each other and looking at areas that we can leverage, getting people to work together and we have plans that to get – for this process to evolve into the July or August time frame of 2014 where we will develop the next strategy, the next long-term 3-5 years strategy for the combined Allied Motion/Globe entity and the I can tell you this, you have heard me talking in the past we will not be satisfied with maintain and the status quo. Those objectives that are in there, the objectives for people to obtain bonuses and so forth are driven by growth and I know our people the same attitude. We brought a team, with the team we brought together here is used to getting rewarded for growing and they understand their rewards are not as good if you stay the same. I mean don’t exist at all if you stay the same or you go down. So I will tell you that certainly the incentives built into the company are to continue growing, our goal is to continue growing. I won’t give you any specifics in terms of the magnitude but that’s never going to change. We again, two well run companies let’s get the power of those two well run companies and get the heads together and get those people working together and define the next level of growth which will be aggressive or continue to be aggressive.

Well I will say this, some of this been with your long time, your credibility is very strong even though you don’t want to quantify when you say which are not satisfied with you have always delivered in the past. So that’s good enough for me right now. Make sure that I am reading the bookings and backlog as positive as it seems, we should start seeing some top-line push through. I mean those are some pretty serious quarter increases over year-to-date, everything I am saying?

Yes. And again that’s a good point that you are bringing up is because structurally we made a change, the bookings, the blanket orders when received and not really is to production had the tendency to really skew the numbers and a lot of it was based upon timing. So what would occur is as if received blanket orders and the blanket orders might have been from 12 to 24 months rare that was 24 months, but if the market was trending down the tendency was for the customer would consummate over more than let’s say it was a 12 months blanket and might take more than 12 months to consume, so then all of a sudden you get the next year’s blanket in there and would give the numbers, so now what you are going to see is what we put in there by a eliminating those you got to have a better comparison for real growth that’s occurring as he orders are actually released and but it is true you are correct the booking is definitely a significant increase over the prior year. We are looking at in the like basis but we want to temper some of that by saying that is caused to a certain extent by the bookings being delayed that weren’t consumed, that have been placed in prior periods. So it's a positive trend. There is no question about it and we are in a like basis, if you looked at us in the prior years from the history and prior history, you are seeing that comparison for that reason. So we are seeing some encouraging sides.

That’s what I wanted to confirm. Couple of housekeeping things. Trade receivable, I mean flat on our side and this is prior to the pro forma, any concern I mean we are up $3 million on trade receivables just happens to be how things here, do you got any concerns there?

No, actually Michael we don’t have any concerns, we look at that pretty rigorously and pretty closely and obviously as part of this deal we were certainly looking at those assets and how they convert over the cash pretty strongly. There are no issues I think most of what you are seeing out there is the increases really how we shift in the last portion of the quarter. So it's really more timing than anything else.

Great. No problem. That explains it. Anything to flash out a little bit in a comp it's not in the press release strictly but in what you did list as far as your different segments where they at, we have got the year-to-date but then you verbally threw in what was happening in the current quarter. It looks like there were several segments that turned from negative to positive for you recently. I mean are you seeing across the board or the particular segments that are really showing some strong turnaround, any comment you want to make on those?

Yes, I would tell you that for the most part if you look talking at the Allied segments and what we report our actual shipments. We don’t report what the new orders, the areas of the order are coming in. So I think we give you historical data, actual data for what was shipped. If you look at the bookings, the new orders coming in, we do see the orders coming in and what we will call, we believe some of the higher value segments for us which is a good sign. There is projects that have been worked on for sometimes, I hate to say it but several years that are starting to come to fruition and we are starting to see some strengths, some additional strength in areas that we focused on in medical, for one. We have markets – we actually have a vertical segment here that we look at. We call it pumps and unfortunately that covers many different potential market segments we try to split that out. We have seen strength there. So we built some good strength off of some past successes there. I will tell you that aerospace and defense, on a go forward basis, worried about sequestration and so forth, we have seen a little bit of an impact there and I say a little bit of an impact. We do expect that to have still see a little bit of impact going forward. What that means is that that has gone down and I am going to tell you less than 10% of what it was, it's down less than 10% but I think over time, that’s just being delayed and pushed out until our government can get some of those things sorted out. There is a need and the demand will come back in those areas but for now we do see a little bit down. So unfortunately, maybe in the future we will be in a better position in that was the question that did come up about our IT system and that’s one of the reasons where we want to put it in our ability to consolidate and be able to provide you some more accurate data in the future right now. There is some significant effort on our part to put that together but hopefully in the future, we can start giving you some forward looking, or when I say forward looking bookings by market information so that you get a feel for what markets are starting to heat up. Right now you are getting historical. I apologize for that that’s the best we can do right now.

You are multitasking fairly well Dick, so no problem. Cash positions currently I mean can you – are you allowed to comment on – I mean did we chew much of that $11 million between September and now?

Sure we can comment on it. I will just turn it over to Rob. Sure we can get in – I can get him to do it. So.

Michael, between – Dick commented earlier is to utilizing cash as part of the transactions, so I think what I can say certainly that we did end the quarter with overall $11.6 million of cash. We did utilize of our own cash we didn’t utilize about $5.7 million of cash in the transaction itself.

Okay.

What I think I can certainly point you is that based upon the accretiveness of this acquisition and the cash generation of both companies I do think that cash position or cash generation is not going to be an issue for us on a going forward basis. I think both companies are strong cash providers and will remain to be strong cash providers.

Well, the final comment on the whole, where it’s one final question you mentioned you have done 80% payout on our incentive program because it’s such a large acquisition I assume that’s going to be addressed that the next board meeting or is that I mean that will need to be tricked out for one of the better word I assume or is it that’s going to satisfy you for a little while I mean I just believe little I got to admit when I saw $250,000 I thought this better be dozy but more it is, so back up boys go and find another one but I mean is that anything that is a hindrance at this point, is that something that can be corrected quickly.

And you are saying corrected quickly it’s the long term and center program that get down it was a five year program that kicked in relatively quicker, so I guess trying to understand what you are saying, are you saying that you would…

Well, I’m just saying you are still leaving the door open for I mean what you guys are very good at adding acquisitions I mean totally agreed and you’ve where to mentioned in making dividend payment that were still looking, the 20% that’s left I mean is that something that’s got to be changed soon or is that sufficient for anything that you would be looking at for the next foreseeable future or is there but that not need to be expanded.

That’s what I was asking I think you certainly a compensation and issue and it’s board issue that has to be addressed and will be addressed and I think from what I’m hearing you says that on the surface the number looks big certainly looks big, but then when you find out what really got accomplished here it’s you are fine with it from what I’m hearing you.

Yes, you are hearing me exactly right. When I first saw not necessarily maybe in the future you might want to put amount together.

Well, I understand your comment from and I think you know certainly I think the message will be heard by the board that our shareholders and you’ve been a long term shareholder here and watching the progress that this is a transformed of one and certainly there was a significantly payout that occurred with that we don’t they want to downplay that but if the reward, the reward comes with accomplishment and I think that’s certainly something that board has always been open to address and if you look back upon it and you say hey we put this in place it’s a long term program we put in place one year later we’ve already accomplished 80% well can be continue to do that.

All right.

That would be a pretty good payback that’s for sure and I think and also to indicate that there were no words or anything provided in this transaction, so again in a typically been many times -- funding you are giving it is dilutive because you are giving up words and potential shares we didn’t have to do any of that, we do not do anything like that, that was one of the items that we put specifically out there is partner that we wanted to come in that did not require that, so it did eliminate some and if there was a share, there was percentage there stock, they certainly that the rate could have come down but I think when you look at it from a pure shareholders standpoint from the date that we announced the transaction to where the stock is today there is some every shareholder has increased shareholder wealth based on certainly the market price and their position is diluted by from 8.8 million shares till a lower 9 million shares. They still have -- there still a nice increase in share and value that’s been received by the shareholders and so it’s not dilutive it’s accretive, okay.

Well, yes and that’s with the new folks but I think where we got to come in on board and we’ve all been very patient for this for the long haul and hopefully we still got a long ways to go, but I just I wanted to clarify that myself for anybody listening this, but may not be used current management, you guys simply make more unique than anything update with, so if anybody sees this if they don’t get the whole picture I just wanted to clarify that I appreciate what you have done as one of your long term shareholders and we totally support you are continuing on this thing and you made a very good point 14.5 is a lot of interest to pay, we probably be paying quite a bit more had we diluted out so I mean all the way around and then issue of the front financing was excellent. So well done gentlemen, just well done.

Thank you very much Michael I appreciate it.

With no more questions in the queue I will now like to turn the call back over to Dick Warzala for closing remarks.

There were few questions that were emailed in and I think I just – let me review these quickly with Rob here and see if we can answer those. We do appreciate you emailing your questions and we do want to answer them for you. One question that did come out is will you continue to dividend and I think we have already shown our plan is to do that. Okay that’s again the transaction one of this magnitude and continuing on with the shareholder reward of the dividend and so our plans are for that to continue. I think another question came in is the big change in your capital structure, can you handle the debt. I think Rob answered that already at this point and you can see the positive from an EBITDA and adjusted EBITDA standpoint that we certainly feel we can. He did give you -- understand a little bit more about the debt structure, I think he did – he explained that and did a good job to any questions after I summarize these and certainly we will open a back up operator. Another question came up how will you restructure the company. I think I have already mentioned that these are two well run companies. And they are not broke. So we are not going to break them. And we are going to get them to work together, develop an understanding of each other’s business and approximately nine months from now come together and say how can we even make it better. So again, we look for great restructuring plans, look for these two companies coming together to generate Michael had asked the question as far growth plans of the future as I said yes. We have growth plans for the future. And it will be the challenge to these teams to put that together. A question about the IT system, how will it impact your plans. Maybe Rob you might want to address that quickly.

Sure. The IT system or the ERP implementation for Allied Motion continues. We have just completed if you will an update to the R2 version of the software at one of our locations and are continuing with our project plan of implementation across all of our TUs, we are continuing with two more of our TUs one in Europe and one is the U.S. at this point. How Globe fits into that? Actually, we are or Allied has gone down the path of implementing the new ERP system is actually a Microsoft product, Microsoft dynamic AX and the Globe also utilizes a Microsoft product a previous version, but we don’t see Globe changing at this point on the new platform. I think we will continue down our path of implementing as we have laid out to our LITUs and overtime we will start to integrate to a single platform structure if it makes sense with Globe but the nice thing is that they are also using a Microsoft product. So hopefully that answers the question on the ERP update.

Okay, and the last two again, any other acquisition planned. We will take our time here. We are always working, they have a tendency to take much longer than you would like them to take so we will continue to work and on acquisitions for the future but I will tell you that I wouldn’t expect anything here in the next nine months at this point until we complete our strategy. When I say I don’t expect it doesn’t mean it won’t happen. It's just that we are focused on in really geared towards making sure that the integration occurs in the proper manner, and the last question that came in was a you are much larger company now, can Allied handle this? And my answer to that is when I first came here, this is a $12 million motion business and we grew organically through our acquisitions to over $100 million and had cash in the bank as Rob mentioned about $11 million. This now takes us over the performance over to $200 million and with some debt, I can tell you that this team, the team that we have assembled I have led companies larger in size than this, and I feel very confident that we have the management team and we will supplement it. We fully recognize we are – it's a different level for us now. We will supplement it as necessary to make sure that the right resources are there to continue to growth in the future. Okay. So those were the questions that were sent in. I am sorry if I answered them real quick but I realize call is going little longer. You might want to get off. But if there are any more questions, we certainly would like to answer those. So operator we can check one more time.

(Operator Instruction)

All right. I think we are done. Well thank you everybody and thank you for your support and we certainly do look forward to bringing back the results here for this combined company in the future and look forward to talking to you next quarter. Thank you operator that will end the call.