Greetings and welcome to MRI Interventions Incorporated 2016 Second Quarter and Six Months Financial Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Frank Grillo, CEO. Please go ahead.

All right, thank you, moderator. Good afternoon, everyone. Thank you for joining us for our Q2 2016 earnings call. With me for today’s call is Hal Hurwitz, our CFO. On behalf of the management team and employees of MRI Interventions, we appreciate your interest in our company. And for those of you, who are shareholders, thank you for your support. For Q2 2016, we have good news about procedure growth, disposable revenue growth, continued improvements in our balance sheet and use of cash and pipeline building for the rest of the year. The adoption of our technology continues and we’re pleased with our position and progress in the market and our momentum going into Q3 and the back half of the year. We’re honored to be working for you and building this great company and we’re proud of the care patients are receiving as a result of the continued adoption of our products and technology. With that, let me turn the call over to Hal for a review of our Q2 2016 financial results and then I will provide further context regarding our progress in the marketplace. Hal?

Thank you, Frank. Before we begin, I want to point out that the comments made on this call may include statements that are forward-looking within the meaning of Securities Laws. These forward-looking statements may include without limitation statements related to anticipated industry trends, the company's plans, prospects, and strategies both preliminary and projected; and management’s expectations, beliefs, estimates, or projections regarding future results of operations. Actual results or trends could differ materially. We undertake no obligation to revise forward-looking statements in light of new information or future events. For more information, please refer to our Annual Report on Form 10-K for the year ended December 31, 2015, which have been filed with the SEC, as well as our quarterly report on Form 10-Q for the quarter and six months ended June 30, 2016, that we filed with the SEC today. All our filings can be obtained from the SEC or by visiting our website at www.mriinterventions.com. Now for our results from the 2016 second quarter. Revenues were $1.1 million for the quarter ended June 30, 2016 and $826,000 for the same period in 2015, an increase of $278,000 or 34% attributable to increases in our ClearPoint system disposable products. ClearPoint disposable product sales for the quarter ended June 30, 2016 were $1 million compared with $678,000 for the same period in 2015, representing an increase of $350,000 or 52%. This increase was due primarily to a greater number of procedures performed during the quarter using the ClearPoint system within a larger installed base for ClearPoint in this quarter relative to the same period in 2015. ClearPoint reusable product sales for the quarter ended June 30, 2016 were $39,000, compared with $93,000 for the same period in 2015. Reusable products consist primarily of computer hardware and software bearing sales prices that…

All right. Thanks, Hal. Okay. I would like to hit some of our highlights for the quarter. To begin with we achieved a record quarterly number of procedures with 125 patients benefiting from the company’s ClearPoint technology, a 44% increase in procedures over Q2, 2015. This is the clearest evidence of strong adoption and enthusiasm for our technology. As Hal mentioned, revenues were $1.1 million for the three months ended June 30, 2016 and $826,000 for the same period in 2015, an increase of 34%. Disposable revenue like procedures as a key indicator for us and disposable revenue grew 52% as compared to the same period in 2015. We restructured the note agreement with Brainlab, resulting in a reduction of debt and accrued interest of over $3 million. I believe we’ve discussed this on prior calls and it was great to have this concluded and finalized early in the quarter. Brainlab is now a customer, a licensee, a debt holder and a shareholder and our relationship with Brainlab continues to be very collaborative and I'm glad to see the strengthening of the balance sheet. As Hal just mentioned, we reduced operating cash burn this quarter to about $1.6 million and that included a payment of $740,000, an accrued interest to Brainlab. In Q2 of 2015, we've used nearly $3 million in cash as we completed our restructuring efforts. So this is about a 47% decrease in use of our cash even with a large payment to Brainlab. That there were a lot of puts and takes in the quarter in terms of cash flow including a great job by our finance people, managing down our receivables and our Days Sales Outstanding receivables. We expect to continue to manage expenses tightly and as we continue to grow revenue we expect to…

At this time, we will be conducting a question-and-answer session. [Operator Instructions] The first question comes from Joseph Dedona with Alexander Capital. Please go ahead.

Hi, Frank.

Hi there, Joe. Thanks for calling in.

Hi, I got a question, are we still targeting next year sometime for break-even?

It's always a question I am frequently asked that question, it’s a hard question to answer, because it really relates to guidance which we're still hesitant to give – given the early stage nature of our business. The end of 2017, first half of 2018 that is certainly our target for getting to a cash break-even type of operating performance, probably not a GAAP break-even performance at that point, but those – that's kind of in the range where we're targeting.

Okay. Thank you.

The next question comes from Mark Abrams, a Private Investor. Please go ahead.

Hi, Frank. Good quarter, but I’ve two questions. Number one, by having the reverse split of 40-for-1, it makes a very small float of the stock now so the wild springs and small amounts of shift. My question is why do we do 40-for-1?

Mark, it’s a good question. In terms of the reverse split what we found with the stock is once the stock was much below a dollar I think more and more people become limited in their ability to trade the stock; and many of the brokers out there now will not even accept $1 stocks or stocks trading for less than a $1, and even a few are demanding we’ll not accept stocks less than $5. So we’ve made a decision to do a reverse split on the stock, change the stock price and open up the number of investors that can take a look at the stock at least in terms of the price how better was that. 1-for-40 is probably not a magic number, 1-for-30, 1-for-20 all of those would have gotten swallowed by the $1, but we felt like, look, let’s do this once and not have to go back and do it again. I understand that over the last few weeks it has been bouncing around a bit. Today, I actually – once again I have been encouraged though is it is trading in terms of dollar volume per day, it is trading much higher volume, obviously not in terms of shares, but in terms of dollar volume. So I think that’s encouraging, that’s a good start, and I think we’ll see it find a natural range over the next few weeks.

Okay. And my question two is in order to get the current tracks you need to refund what break-even anything like that, have you – any kind of possibilities of doing any kind of partnerships or licensing agreements, because – I mean, even though you’re growing, it’s just not enough to get where you really need to be because you remember you haven’t got your cash again.

We talk to other companies all the time. Hence in terms of like press release type strategic agreements, what we’re doing right now is we work very closely with the number of other companies already. We work very closely with both Monteris and Medtronic on laser ablation. We were closely with the Medtronic teams on DBS. We work very closely with – I think we’re up to six, seven different drug companies now on drug delivery. So we actually work closely with a large number of companies. And at some point one of those might turn into a more significant partnership, although that’s probably not on a rise in this quarter. So I’m actually pleased with the way we’re working with other companies in the field of neurosurgery. And I think you do need to look at it as we work at a lot of different companies and a lot of different technologies already. And our growth is – that’s right, we’re very symbiotic as one grows the other grows. So we all help either other out that way.

Yes. Because what I’m saying is that – you just have one of the best technologies out there, but there’s not enough people know about it, and it just doesn’t seems to be growing in the kind of direction you really need to go. But with the direction you need to have perfect product for – first you gave – delivered drugs to Parkinson’s which could be your overall game changer completely, and we think that was a product you have which is so good, why aren’t people just jumping out and say, wow, if I had this product – if my company was probably Medtronic or that was a Johnson & Johnson or any of these companies, why can’t they say why can’t I do something with these people, really an interesting, a fabulous company.

It's an interesting example you brought up in drug delivery. We're working which four or five different companies now on utilizing our products for the delivery of drugs to treat Parkinson's disease. However, if there is one industry that is more regulated than the medical device industry, it might be the pharmaceutical industry. So these things take time to develop. I really feel like we have this great growing business in procedures now and it’s a great upside in drug delivery. And we're continuing to pursue as many partnerships and relationships as we can in that field and I do think we'll see that pay off over time. In the meantime we're building a business herein now on procedures that are available to us right now and that we can continue to drive our growth with.

And then one last question, have you indentified the actual market for your products out there as far as procedures go?

Well, we – on our investor presentation on our website we do give an outline of the procedure size that we believe it’s the potential procedure size for our products based on the markets we know as of today. And so that adds up to 50,000 to 55,000 potential procedures in the United States. You've keyed in on a key area, the drug delivery side of things could change our market potential significantly if one of those drugs gets approved. I think we could see some really encouraging procedure in potential market sizes on the drug delivery side. But again the developing drugs that are injected directly into the brain does take some time.

Sure.

And we’re partnering with as many people as we can to develop those markets and end products.

Thank you very much.

Thank you, Mark.

The next question comes from Bruce Conway, a Private Investor. Please go ahead.

Hi, Frank. I think I got it on the call that you had a record number of procedures for June and that had continued in July. Can you tell me if you added any new sites and what the projections are for site additions for the rest of the year?

Sure. So we had a record number of procedures for Q2 in 125, and June was also a record for monthly procedures for us with fingers around 53 in June. And I will say that, I won’t typically give out monthly procedures numbers, but I did find June very encouraging. Momentum has continued on procedures, procedures feel like they're looking very good this quarter. And then in terms of sites, we did not add new sites in Q2, but we did see a nice tilt in our pipeline for capital sales. We’re working very hard on to close for the second half of the year, as well as a good handful of new evaluation sites, new accounts as well. So Q2 was wide on capital in sites, but the back half of the year looks pretty good.

Thank you, Frank.

You bet. Thank you, Bruce.

The next question comes from Alan Eisenman, a Private Investor. Please go ahead.

My question has been answered. Thank you.

Thanks, Alan.

Ladies and gentlemen, we have reached the end of the question-and-answer session. And I would like to turn the call back to Frank Grillo for closing remarks.

All right. Thank you moderator, thank you, I guess, Jerry. Just to close briefly, we appreciate the interest of our investors and hope that you sense our excitement about the progress of our company. We’re changing our neurosurgery has done, where it is done, and in some instances what can be done. We are confident of the benefits of our technology brings to patient care and we are committed to bringing these benefits to more and more hospitals, surgeons and patients, and the marketplace is responding with growing interest and use of our products. Thank you again for joining us and we’ll talk with you next quarter. Bye-bye.

This concludes today’s conference. Thank you for your participation. You may disconnect your lines at this time.