Good evening. My name is Nicole and I will be your conference operator today. At this time, I would like to welcome everyone to the Q4 and Annual 2015 Financial Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question-and-answer session. [Operator Instructions] Thank you. Mike Paxton, you may begin your conference.

Okay, thanks. Welcome to this afternoon’s conference call to review Intrusion's fourth quarter and annual 2015 financial results and discuss our business. On the call with me today will be Ward Paxton, Chairman, Co-Founder, President and CEO and Joe Head, Vice President and Co-Founder of the company. Ward will give a business update, I will discuss financial results and Joe will give an update of ongoing projects. We will be glad to answer any questions after our prepared remarks. We distributed the earnings release at approximately 3:05 p.m. today. A replay of today’s call will be available at approximately 6:30 p.m. central time tonight for a one-week period. The replay conference call number is 855-859-2056. At the replay prompt, conference ID number 47380119. In addition, a live and archived audio webcast of the call is available on our website, intrusion.com. Please be reminded that during this call, including the question-and-answer session, we may make forward-looking statements with respect to financial results, business strategies, industry trends and certain other matters. Forward-looking statements are based on management’s current expectations and are subject to risk and uncertainties. We may be discussing our current outlook based on our own internal projections for the current quarter and fiscal year 2016. Actual results may differ substantially from internal projections. We are not responsible to updating the forward-looking statements. Many factors could cause our projections not to be achieved, including current economic and market conditions and other factors which can be found in our most recent filings with the SEC, including our most recent Annual Report on Form 10-K which was filed in March 2015 and previous Form 10-Qs. Now, I will turn the call over to CEO and President, Ward Paxton.

Thank you, Mike. Welcome to Intrusion’s fourth quarter 2015 conference call. It’s good to be with you today to discuss our fourth quarter results and our progress. The fourth quarter 2015 was about the same as the third quarter 2015. Fourth quarter 2015 orders booked totaled about $1.9 million compared to $1.8 million in the third quarter and $1.4 million in fourth quarter 2014. Orders totaled $7.4 million for all of 2015 compared to $7.1 million for all of 2014. Savant orders totaled $1.3 million in 2015 compared to$0.9 million in 2014. So, moderate growth in orders booked last year but significantly below our expectations. We continue to pursue large resale partners for sales of our Savant product family and continue to pursue sales to large commercial customers. Our engineering efforts for Savant are focused on additional features for the product family as we move forward to improve and expand our ability for detecting advanced persistent threats. We will discuss our sales activities later, but now Mike Paxton, our Chief Financial Officer will review our fourth quarter and annual 2015 financial results that we released a little over an hour ago. Mike?

Okay, we'll go over the fourth quarter and annual 2015 financial highlights from the press release. Revenue for the fourth quarter is $1.5 million compared to $1.8 million for the fourth quarter of 2014. For the year 2015 sales were $6.8 million compared to $7.2 million in 2014. Sales levels were obviously a disappointment over an entire year. Gross profit margin was at 63% in the fourth quarter compared to 65% in the fourth quarter last year and the annual margins contract at 2015 was 63% compared to 65% in 2014. The gross profit margin can be greatly affected by sales product mix or in this case pure sales volume being lower than expected. In general our goal is 65%. Intrusion's fourth quarter 2015 operating expenses were $1.4 million compared to $1.3 million for the comparable quarter in 2014, $5.4 million for the year 2015 compared to $4.9 million in 2014. Operating expenses increased due to planned increases in research and development and sales and marketing expenses. Net loss for the fourth quarter was $0.5 million compared to a net loss of $0.1 million for the fourth quarter of 2014 and net loss was $1.2 million for the year 2015 compared to $0.3 million loss in 2014. We fell short of our sales goals for the year. We expanded our selling efforts for Savant sales in 2015. We will continue this effort but sales cycle continues to be difficult. We will continue to look at all options for sales growth. Direct sales are more likely to through a large reseller or partner. Now I'll send it back to Ward.

Thanks Mike. Now Joe Head, my partner, Co-Founder and Senior Vice President will discuss our products, markets and sales activities. Joe?

Thanks Ward. In the fourth quarter we booked only one new Savant order and it was from our original resell partner. Our original resell partner is large and has had turnover in both field security engineers as well as service offerings management. So their product project pipeline stalled as I mentioned last quarter. We received $117,000 order to install Savant at an internal customer at this first reseller partner and then also using this installation to qualify us for some new programs. This first reseller has other managed security offerings on which we are not included. And one of their customers last year when we were up for a major renewal we won the customer over but the customer upgraded to another managed security service offering on which we were not included. So based on that loss we asked our partner to include us on all these other managed security product offerings and they've responded favorably and are qualifying us. The engineering team in charge of qualifying new stuff wants to use Savant for these offerings too as Savant represents a step up in capabilities and offers faster response to their operational folks. The normal question is, why were we not included in the first place. It was because this product definition was done by another team we never knew inside this big company that we call our original resell partner. Now both teams have been combined into one team and all report to the team leader we've been working with all along. As our sales have been tied to their wins, they are doing a restart of the security offerings too. So when they take off we expect to be on the whole offering slate that they take to their customers. Our second resale partner is also looking to…

Yes, thank you, Joe. We have a lot of new opportunities in both Savant and TraceCop business areas and we expect growth in both products this year. Our engineering and analysis teams continue outstanding performance and development of new features in the products. We thank you for your joining our call today and look forward to communication with you in the future. Mike?

Okay, at this time Nicole, could you remind the participants how to queue up for questions?

[Operator Instructions] Your first question comes from the line of Wilson [indiscernible]. Your line is open.

Close enough. Hi, guys.

Hi [indiscernible].

I have decided and this is not set up and I apologize if my dog is barking in the background. My daughter who really does exist and it sounds like she is a makeup here, called me today at about 3 o’ clock. She is just starting a brokerage statement and said what’s going on with my brokerage statement, the value is going down which we all on the quote can appreciate. She asked or made the following comments and I believe them because they are very broad and she is a teacher, so that lacks some sophistication and that’s why you don’t feel like I’m picking on you. I hope to do the following two quotes; first quote, why the heck can't they make any money, and the second quote is, do we have to hold on until the ship sinks. So I realized you did address that to some extent, but could you give her a little bit more color, because I do make her look at the transcript and I'm not sure she really pays attention on why the heck can't they make any money since we have now increased our loss for the last six months to a level which is starting to become meaningful?

Well, with respect to the questions, Mack [ph] at the end of 2013 we decided to increase our investment in sales and marketing and engineering expenses and so began that at that point in time. In 2013 we had revenues of $7.5 million and a net income of $600,000. So the steps we took basically were to use that net income and some additional resources to finance the expansion in sales and marketing and engineering expenses. With that expansion, we had planned for the revenue expansion to begin instead of not and actually contracting a little bit and that occurred both in Savant and in TraceCop. But now we see the increases in TraceCop that we believe will be there this year and increases in Savant that we believe will be there this year. So we think everything is on the right track.

Okay. And just a comment to put it in the transcript because people didn’t notice, I appreciate the fact that both Mike and Ward both of your exercised options which are basically at market, you probably could have bought it in the open market for a couple of pennies less, so it’s always good to see you people, you people meaning the Paxton family further committing some funds to Intrusion. So I'd like that and I do give you, since I complain a lot, to get credit for that guys. Thank you.

Thank you.

There are no further questions at this time.

Okay operator at this time, we will wrap up the call. Thank you for participating in today’s call. If you did not receive a copy of the press release or if you have any questions, you can call me at 972-301-3658 or e-mail to mpaxton@intrusion.com. Thanks again.

This concludes today’s conference. You may now disconnect.