Good afternoon. And welcome to Kopin Corporation's Conference Call to provide a Business Update and Results for the Fiscal Fourth Quarter and Year Ended December 28, 2013. Today's call is being recorded for Internet replay. You may access an archived version of the call on Kopin's website at www.kopin.com. With us today from the company are Chairman and Chief Executive Officer, Dr. John Fan; and Chief Financial Officer, Mr. Richard Sneider. Mr. Sneider, please go ahead, sir.

Thank you, Operator. Welcome everyone and thank you for joining us this afternoon. John will begin today's call with a discussion of our strategy, technology and market. I will go through the 2013 fiscal fourth quarter and year end results at a high level. John will conclude our prepared remarks and then we'll be happy to take your questions. I would like to remind everyone that during today's call, taking place on Tuesday, March 11, 2014, we will be making forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are based on the company's current expectations, projections, beliefs and estimates, and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those looking-forward statements. Potential risks include, but are not limited to, demand for our products, operating results for our subsidiaries, market conditions and other factors discussed in our most recent annual report on Form 10-K and other documents filed with the Securities and Exchange Commission. The company undertakes no obligation to update the forward-looking statements made during today's call. And with that, I'll turn it over to John.

Thank you, Rich. Good morning, everyone. And it is early morning in Tokyo, where I am at right now and thanks for joining us. I want to start out by saying that we are extremely pleased with the progress we have made towards positioning ourselves into a global leader in wearable -- wearable technology. Our strategy is on track and we are seeing significant interest from customers who are looking to use our components as early as this summer, with designing coming for a number of large customers in the second half of this year. We expect this product will ship in 2015. This past month we hosted a wearable technology event, an open-house for our new wearable technology center in Silicon Valley. This was a showcase event that featured a panel discussion and keynotes by some of the top minds in this industry. We have demos our prototype wearable technology and we are toured of our state-of-the-art acoustic lab. We had close to 200 representatives from all sectors of the industry, including customers, potential customers, analyst, media and panel. The energy and anticipation of big things to come was very strong. It was clear that wearable technologies are a viable technology category and ready to go main stream. We have showed the results of some of our recent innovations. This innovations cover all aspect of our portfolio, on display, for optics, noise cancellation and active speech recognition, ergonomics and ASIC to create a dream product, in order to create a dream product of the wearable market. The dream is to have a pair of eyeglasses indistinguishable from the pair many people wear today. One of our new innovations was extremely compact Pupil display module, which encompasses our innovative transmissive LCD microdisplay technology and miniaturized optics licensed from our partner…

Thank you, John. Beginning with our results for the fourth quarter, total revenues for the fourth quarter of 2013 were $5.5 million, compared with $8.6 million for the fourth quarter 2012, primarily reflecting the expected decline in sales of display products for military applications. Before we go into the operating expenses, it' important to remember that our expense structure is not tied to the current quarterly revenues or fiscal year revenue projections, but to our longer-term goals. Cost of sales for the fourth quarter was 85.7% of product revenues compared with 67.6% for the fourth quarter of last year. The increase reflects a decrease in the sale of our display products for applications and lower manufacturing utilizations. R&D expense in the fourth quarter of 2013 was $4 million, compared with $3.6 million for the fourth quarter of 2012. The increase reflects investments in wearable technologies. SG&A expenses increased from $3.5 million in the fourth quarter of 2012 to $4.1 million in the fourth quarter of this year. In the fourth quarter this year, we took a non-cash charge to write-down certain intangible assets of approximately $1.5 million. Other income/expense net is primarily composed of approximately $380,000 of interest income, approximately $200,000 in foreign currency losses. We also recorded an impairment charge in an equity investment of approximately $2.5 million. Turning to the bottom line, our net loss for the quarter was $9.7 million, or $0.16 per fully diluted share, compared with a net loss of $3.9 million, or $0.06 per share, for the fourth quarter of 2012. Now turning to results for the full year, total revenues for 2013 were $22.9 million, compared with $34.6 million in 2012, again primarily reflecting expected decline in sales of display products for military applications. Cost of goods for the full year was approximately…

Thank you, Rich. As I've said earlier in the call, we are on track with our transformation, and are extremely pleased with our progress so far. Demand is growing for wearable computing products and the recent development are only a sample of things to come. We remain in active discussions with a number of leading technology companies. We're looking to accelerate and enable their entrance into wearable computing market. Kopin has been a thought leader for many years, in exactly the areas that are making wearable a reality. We expect our business model will allow us to generate potentially higher gross margin and position ourselves for high rapid growth. We have a very strong cash position and debt-free balance sheet. We expect to maintain our level of investments in the growing wearable systems for the foreseeable future. We look forward to reporting exciting opportunities and developments on future costs. And now operator, please open the line for questions.

(Operator Instructions) Our first question is from Matt Robison of Wunderlich Securities. Please go ahead.

Hey, thanks for taking my question. You have nice uptick in funded R&D. Can you give us a little background for that and if there is any visibility for that to continue?

You see the uptick is related to commercial activities. Some of the partners and activities that John spoke about in the call have funded certain product development and that's what was reflected there. And as John indicated, we're in discussion with a number of people so as those discussions come to fruition, we would hope there would be more of it. It's not like the military where it has a little bit more visibility. These will really be dependent on when we close deals. But military is kind of based upon the U.S. government procurement schedule.

You mentioned military inquiries recently and it wasn’t clear whether you meant to say that -- you said it wasn’t included in your old guidance but you didn't previously give guidance for 2014 I don't think so. Is the 2014 guidance that you gave with or without incremental military business?

It is without.

Okay. So you are still in some discussions that could yield something incremental from the military then, is that what we should takeaway?

Right, it is upside on the military right now.

Would we first see that as funded R&D and or…?

No, it’s programs that we have been designed into.

Okay. So really something that might materialize in a quarter or two that kind of a thing?

Yes.

Okay. Then, you mentioned $30 million to $35 million in cash from operations, cash used from operation this year. What’s the backdrop for that increasing, I guess, about $10 million plus over what was used in 2013?

The biggest factor is coming out of last year, we had working capital, which we -- as the revenues have declined, we haven’t actually had to refund the working capital. So this year, we had a boost of about $7 million from working capital which I’m not factoring into 2014.

Okay.

You follow me, Matt with a question of receivables and so on.

Yeah. Sure. Sure. Now, what do you think you are going to do in terms of CapEx this year?

Honestly, the number we’ve been looking at is $2 million to $3 million. In the current year, we did little less than a $1 million. It’s actually about $750,000, but right now we’re seeing $2 million to $3 million.

Okay. So, ’13 was 750k. And so there is none of that cash consumption reflects the reverse of the working capital effect that you had in 2015? You don’t expect any kind of inventory or anything like that baked into that?

That’s correct.

Okay. That’s all for me. Thanks.

Thank you. (Operator Instructions) And the next question is from Joseph Zaccaria of Needham & Company. Please go ahead. Joseph Zaccaria - Needham & Company: Hey guys, thanks for taking the question and congrats on the results and appreciate the figured outlook. I was wondering if you could talk a little bit about the OpEx for the full year. I know you guys have said that it is tied into your assumptions of future revenue stream. I was wondering if you could give little bit clarity on whether or not that includes in Silicon Valley Center or how we can model that into it. And then also a little bit about the -- how much leverage there is once you start to see the ramp in wearables, how can we see OpEx trend there? Thanks.

As far as the OpEx, we kind of give you the top and bottom line. The composition will probably for the first couple of quarters of the year will be consistent with what we’ve had coming out of the fourth quarter. And then we would expect the R&D to start declining as more of it potentially moves into manufacturing, as customers start trying to get prototype products out, things like that. So there will be a shift in the second half, (indiscernible) same run rate as the fourth quarter. Joseph Zaccaria - Needham & Company: Okay, thanks. And I guess, if I read it on a 20,000 foot level, it seems to me like the push-out, there's been a bit of a push-out in wearables. Is that fair? And if so, what are some of the dynamics at play there?

I will let, John…

I don’t think there's a push-out at all. I think there’s a pull-in right now. Joseph Zaccaria - Needham & Company: Okay, great. I appreciate guys.

Thank you.

We have no further questions in queue at this time. I would like to turn the call back over to management for any closing remarks.

Well, thank you everyone for joining us today. We look forward to speaking with you again in the near future. Thank you.

Thank you. Ladies and gentlemen, that does conclude today's teleconference. You may disconnect your lines at this time and thank you for your participation.