Greetings and welcome to the ClearSign Combustion Corporation 2012 Fourth Quarter Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. (Operator Instructions). As a reminder, this conference is being recorded. This call will include forward-looking information and statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Except for historical information contained in this release, statements in this release may constitute forward-looking statements regarding our assumptions, projections, expectations, targets, intentions or beliefs about future events that are based on management’s belief, as well as assumptions made by, and information currently available to, management. While we believe that our expectations are based upon reasonable assumptions, there can be no assurances that our goals and strategies will be realized. Numerous factors, including risks and uncertainties, may affect our actual results and may cause results to differ materially from those expressed in forward-looking statements made by us on our behalf. Some of these factors include the acceptance of existing and future products, the impacts of competitive products and pricing, general business and economic conditions, and other factors detailed in our Annual Report on Form 10-K and the other periodic reports filed with the SEC. We specifically disclaim any obligations to update or revise any forward-looking statements whether as result of new information, future developments or otherwise. It is now my pleasure to introduce your host, Rick Rutkowski, Chief Executive Officer. Thank you, Mr. Rutkowski, you may begin.

Thank you, everyone, for joining us on a Friday after … on the East Coast and given that that’s the case, we’ll try to keep today’s call pithy and to the point. I apologize for any inconvenience by the scheduling. Our travel schedule’s been somewhat influx here and that’s the good news; that we’re staying very busy here. I’m going to ask Jim Harmon, our Chief Financial Officer, to take us through the financial results for 2012. Then, we’ll get in to discussing some of the very exciting milestones that we’ve achieved in the last year and more particularly some recent developments. I think more importantly, how that sets the stage for 2013 and 2014 as we look forward to what we think can be a very exciting and active time for the business. Thank you. Jim, why don’t you —?

Thank you, Rick. I’ll keep this brief because our results are simple and on plan, and the color really comes with the other aspects of this call. First off, just to emphasize to folks we are a development stage company, meaning that we’ve not recorded any revenue to date. At the point we do record revenue; we will remove from that mode and be a normal reporting company. Our bottom line for the year, which is mostly of course our operating expenses being research and development and SG&A costs, were $4.2 million for the year versus $3 million last year. RD costs were $1.2 million, which more than doubled from the 500,000 last year. Our selling, general, and administrative expenses were $3 million, which were up 20% from the $2.5 million recorded last year. Just to remind folks, we completed our IPO and substantial funding in April and with that came an increase in operational activities on our part to move our process forward. I’ll let Rick, of course, describe what those are in more detail. As I summarized, everything’s in line with what our plan was when we formulated in late 2011 in anticipation of our IPO, so we continue to be on plan. The last thing that I’ll quickly emphasize is a quick look at our balance sheet. Our working capital is about $7.6 million. Our stockholder’s equity is about $8.6 million. Within our working capital, we have $8 million as cash. With that, I’ll pass that back over to you.

Yes. Thanks. I think from the financial perspective, the thing that is, of course, pleasing to us at this stage of our development, is that we have been able to march along very much according to plan and in line with our budget estimates. I think part of that is that we’ve been running at … is well documented but there are some important highlights that I think illustrate a progression here, and it’s a rapid pace of progression. For those of you who are newer to the company, for example, you may not be familiar with the fact that when we went public in April of last year, our demonstration scale systems, our prototype systems, were very small systems generating heat release, or thermal output of about 100,000 btu/hr. We scaled that by a factor of ten and achieved that milestone to one million btu/hr. We achieved that milestone in September, a full quarter ahead of schedule. That’s important because that’s what we call a commercially referenceable scale. Within the industry, when we look at systems that are a million, five million, six million btus, it’s important that people can see that you can scale this to that industrial scale or near industrial scale. Indeed there are commercial systems even in the several 100,000 btu/hr, so that was a major milestone. Equally important, was that we were able to utilize the affects that we demonstrated at that scale to show that we could, in fact, use entirely new methods of reducing nitrogen oxide, and this is as compared to conventional burners, which stage the introduction of fuel and air and create a very complex arrangement of lean and rich fuel zones, which is equally complex to manage and comes with some penalties to energy efficiency. I think the important…

Thank you. We will now be conducting a question and answer session. (Operator Instructions) One moment please while we poll for questions. Our first question comes from Jim Mcllree with Dominick & Dominick. Please proceed with your question. Jim Mcllree – Dominick & Dominick, LLC: Thank you and good afternoon, Rick.

Hello, Jim. Jim Mcllree – Dominick & Dominick, LLC: I think I ask you this every time we meet, but can you help me understand what markets you think you’ll target first for—let me ask it a different way. What markets do you think are going to be the initial adopters that actually generate revenue for your—which are the first ones?

I think it’s the three that I just sort of touched on, which were refinery heaters and there are several different applications within the refinery, Ultra-Low NOx burners, which can be used in both package boilers and process heaters. A lot of that demand is being driven out of places like California, Southern California, and Houston, Texas who are facing some very tough new regulations in that regard; and frankly, people are at a bit of a loss for answers in this and facing some much more expensive possible solutions. Then, thirdly, the domain of solid fuels. I couldn’t tell you which of those will be first to market, but that depends to some degree on how aggressively our partners move forward and to some degree also on what kinds of results we see out of the gate here with our solid fuel efforts, but I think we’ve got motivated partners in each of those three categories. The other thing that’s sort of common there is if you recall we’ve talked in the past about five to six million btu/hr is kind of a sweet spot that is common to all of those segments. There are smaller burners in every one of those categories as well, but that’s kind of the range that we’re targeting in terms of our scale of efforts, and it matches nicely with those. In a refinery, you might see a crude heater that has an array of ten or even dozens of burners in them, vertical cylindrical heaters, and the same with steam methane reformers. These tend to be arrays of “smaller burners;” these are still large burners at five to six million btu/hr, but those three categories are the ones that at the moment really logically make sense to us as an early market entry point. Jim Mcllree – Dominick & Dominick, LLC: When do you think that it’s likely that you would commercialize this for one of those markets?

I think we’ll see our first commercial installations in a 12/18-month time period, maybe 24 months on the outside. We’re kind of, as we’ve said, marching to the plan that we articulated last year when we called that about a 24- to 30-month process going back to the second quarter of last year. I think we’re on track for that kind of timeline. What we’re talking about there, of course, is really the first commercial installations, which is a very, very significant milestone for us. As I’ve said, I think we’re very much on track to meeting that objective. This duplex burner, one of the things that’s exciting to us about it is that this looks like—based on what we know and have learned about the scale parameters and scaling constraints for the technology, this looks very, very scalable to us and so that’s encouraging in that regard. Jim Mcllree – Dominick and Dominick, LLC: Great. Thank you a lot.

Yes. Thank you and have a great weekend.

Our next question comes from Ankur Desai with MDB. Please proceed with your question. Ankur Desai – MDB Capital Group, LLC: Thank you for taking my question. Congratulations on a great year. I wanted to ask you about—I know that you mentioned earlier benefits to the refinery space and the tens of millions of dollars in that kind of range. That would be very compelling and I kind of wanted to push back on that a little bit. How did you come up with those numbers and what did you do to sort of make those estimates?

Thank you for asking us that. At the risk of again repeating for folks who are more familiar, this is a platform technology. One of the key challenges you have, and it’s sort of a high class problem in ways, it’s a target rich environment. Combustion covers two-thirds of the world’s energy; it’s used throughout industry for process heating of all kinds. It becomes a question of how do you select the opportunities and compare where the best ones are. In that context, we perform a very rigorous, what we call, use case analysis. Now focusing it back to your question, so with respect to refineries, and the same would be true with package boilers or industrial scale combustion of solid fuels; we do a very detailed analysis that basically allows us to connect the dots between flame shape, process throughput, and energy efficiency. We cast those assumptions through our dialogue with partners and end user customers, and frankly, we’ve also brought in third party subject matter experts to validate that. We’re very close; I think a matter of days to a week or so, to publishing the refinery use case in some detail. We can give you a peek at it ahead of time, as there’s nothing proprietary about it, it’s just an analysis. Essentially, the way it works is if you have these—let’s say take the crude heater as an example, it’s a vertical cylindrical heater heated from an array of burners underneath and if you now lose control of the flame pattern or you have this elongated flame, what that means is that you now can put literally less heat in to the finite volume that you have, right? So you’ve got a heater and it’s rated for a certain thermal output, but now when you stretch…

Sure. No, it’s been very encouraging and very supportive, and in fact, we don’t go in the door saying, “Oh, we have all the answers. We’ve concluded that these are the answers.” We go in the door saying, “These are the assumptions. We have validated these assumptions with a few other companies, but we’d like your feedback.” When you see the assumptions and hear the assumptions that I just gave you, that’s really the result of that kind of interaction. We’re inviting them to come back and push back on the numbers or give us a different spin on it. Indeed, we’ve had some of that. For example, in conversations with one of those major oil producers, they were very excited by the things we were talking to them about, but they also said, “Gee, the thing that’s really exciting to us is this whole flame stability thing means that we might be able to hit a very key goal for us of 1% oxygen in a stack.” Now, that’s an extremely important metric to that particular company. The Valero case that I mentioned, we were initially in conversation with them about the use case for steam methane reformers and he turned the conversation to say, “Gee, these crude heaters, I have a very bad problem with flame pattern.” So we ask them to quantify it for us, so we feel that we’ve made a significant effort to not only be objective about this, but to collect inputs from multiple sources, and again, not to present these are conclusory, but to invite response from prospective customers. The response has been supportive and enthusiastic and encouraging and there’s a great deal of excitement. As I said, we’ve got virtually every one of the major suppliers now in dialogue with us and several of the very, very large end user customers to whom this can make a significant difference in our operations. Ankur Desai – MDB Capital Group, LLC: Is there a potential revenue model from kind of sharing in the cost … with these guys or is that sort of not the way the ...?

It’s a great question, and the answer is yes and no. By and large, the combustion and emissions control industry work according to the rules of capital equipment purchases, right? We’d like an ROI. We have a ... for it. With an important exception, there really isn’t typically an economic ROI associated with emissions control. You put them in because you have to, and then you do the best you can to control the cost of the equipment. Indeed, that’s part of the dialogue between the regulators and industries. Is there an “affordable solution” out there? So they tend to be capital equipment purchases with the difference being that unlike conventional capital equipment, which you buy for productivity reasons and therefore has a positive economic ROI associated with it; historically, emissions control equipment has not. That’s part of the power of what we’re suggesting here is that now you can begin to connect a positive economic ROI with emissions control. In Ultra-Low NOx burners, that’s really the point I’m making when we talk about the fact that we can eliminate external flue gas recirculation and minimize excess air. Those also translate in to significant dollar savings in energy efficiency, and again, we’ve really worked hard to quantify those with some kind of precision in that regard. To answer your question about the model, there is precedent for companies being able to participate in some of that savings, and one of the companies that we’re in dialogue with is one of the companies who set that precedent, so things can be priced that way. Obviously, it’s our goal to value price our technology in any case, but we do think there is within some certain segments at least there will be an opportunity to have a recurring revenue stream associated with the technology in that regard. Ankur Desai – MDB Capital Group, LLC: Okay. Thank you very much.

Thank you, Ankur.

(Operator Instructions) We have no further questions in queue at this time. I would like to turn the call back over to management for closing comments.

Well, again, thank you, everyone, for bearing with us on a Friday afternoon here. I want to encourage any and all of you to certainly go to our website. There’s a lot of great information there. We’re adding additional information including the video that I mentioned and the use case analysis will be appearing there in short order. We appreciate and understand this is a complex subject matter, so we try to make sure that that’s a resource and a tool to you. On the other hand, we also know that doesn’t answer and can’t answer all of your questions about either the technology or the company. Two things; one of which is that we always invite people to come and visit us here in Seattle because we’re two and a half miles from the airport and there really is no substitute if you want to be excited about ClearSign for coming to the company. Because it’s not just an exciting technology, you’ll meet a team that is capable and engaged and you’ll just feel a really great energy when you come here. Also short of that, please don’t hesitative to give us a call. We’re an early-stage company and you mean a lot to us as shareholders and backers of our efforts here. We understand that there are a lot of questions along the way, and we’re going to do our best to make sure that you have good answers to those questions when you need them. Don’t hesitate to reach out and we’ll try to do the same with you guys. Stay tuned, there’s more to come in the news pipeline as we progress forward. Again, I thank you for your time on a Friday afternoon and evening. I hope all of you have a wonderful weekend, and we’ll look forward, I hope, to seeing many of you in Seattle. Some folks have come up and I think it’s proven to be a gratifying experience for them as well. Thank you, again.

This concludes today’s teleconference. You may disconnect you lines at this time, and thank you for your participation.