Good morning and welcome to the Hudson Global Conference Call for the Fourth Quarter of 2019. Our call this morning will be led by Chief Executive Officer, Jeff Eberwein; and Chief Financial Officer, Matt Diamond. Please be advised that the statements made during the presentation include Forward-Looking Statements under applicable securities laws.

Such forward-looking statements involve certain risks and uncertainties that may cause actual results to differ materially from those contain in the forward-looking statements.

These risks are discussed in our Form 8-K filed yesterday and then our other filings made with the Securities and Exchange Commission, including our annual report on Form 10-K. The Company disclaims any obligation to update any forward-looking statements.

During the course of this conference call references will be made to non-GAAP terms such as adjusted EBITDA, an adjusted EBITDA reconciliation is included in our earnings release and quarterly slides both posted on our website hudsonrpo.com I encourage you to access our earnest materials at this time, as they will serve as a helpful reference guide during our call.

I will now turn the call over to Jeff Eberwein..

Thank you, operator, and welcome everyone. We thank you for your interest in Hudson Global and for joining us today. I will start by reviewing the fourth quarter 2019 highlights and Matt Diamond, our CFO will provide some additional details on our results.

I will then give some perspective on our RPO business, including current trends, Hudson's corporate costs and our share buyback initiatives. For the fourth quarter of 2019, we reported revenue of 25.4 million, up 57% year-over-year in constant currency.

Revenue less certain direct costs of 11.1 million increased 10% year-over-year in constant currency and we grew revenue less certain direct costs in all three regions. We saw particularly strong growth in our businesses in Australia and Continental Europe in Q4.

SG&A cost were 10.2 million in the fourth quarter down 2% versus the same period last year in constant currency. We reported adjusted EBITDA of 900,000 compared to an adjusted EBITDA loss of 300,000 a year-ago.

In addition, we reported net income of 1.5 million, or $0.48 per share versus a net loss of 600,000, or $0.19 per share in the same period last year. Importantly, I want to thank all of our highly dedicated employees for their hard work in 2019.

We believe that our fourth quarter 2019 results started to show the payoff from all of our hard work to grow the business while cutting overhead costs. We will discuss current business trends later in this call. Turning to performance for the quarter by region.

Our Asia-Pacific business had very strong year-on-year growth in revenue of 101%, while revenue less certain direct costs grew 5% in constant currency. The year-over-year revenue growth was driven by the commencement of a large MSP contract in Australia earlier in 2019 as discussed on previous calls.

Growth in revenue, less certain direct costs in Q4 was particularly strong in Australia, largely due to higher volumes at existing clients.

Americas had an increase in revenue less certain direct costs of 2% year-over-year in constant currency with strong performance at several newly won clients being partially offset by lower volumes at some legacy clients. Adjusted EBITDA of 200,000 was flat versus a year ago.

Our EMEA business produced another very solid quarter with revenue, less certain direct costs of 36% in constant currency. The growth was driven by strong results in our businesses in Continental Europe. Adjusted EBITDA of 400,000 increased from an adjusted EBITDA loss of 300,000 in Q4 of last year.

We are very proud of the growth and momentum in our EMEA business. Lastly, I would like to extend a special congratulations to Matt Diamond for his promotion to CFO on January 1st. I speak for the entire Hudson team when I say that we appreciate his hard work and dedication to our Company.

I will now turn the call over to Matt to review some additional financial details from the fourth quarter..

Thank you, Jeff, and good morning everyone. Our fourth quarter tax benefit from continuing operations was 900,000 primarily reflecting the release of reserves relating to uncertain tax positions from prior years. The Company generated 2.7 million in cash flow from operations during the fourth quarter.

Days sales outstanding was 42 days at December 2019, well improved from DSO of 50 days that we had in December, 2018. We ended the quarter with 31.7 million in cash and restricted cash.

As a reminder, in April, 2019, we finalized a new credit facility in Australia to support the expected growth in working capital needs as a result of new client wins in that market, but we had nothing drawn on this facility at the end of Q4.

I will now turn the call back over to Jeff to give some more perspective on our RPO business, Hudson's corporate costs and to review current trends in our business..

Thank you, Matt. Turning to Hudson's corporate costs, immediately following the closing of the divestitures at the end of the first quarter of 2018, management reviewed the Company's corporate costs on a line-by-line basis and began to right size these costs for the new business model.

We believe corporate costs in 2020 should be approximately four million excluding non-recurring items or similar to the annualized run rate for corporate costs in Q3 and Q4 of 2019. This reduction in corporate costs has not impacted our operating business.

For the full-year 2019, the Company's corporate costs of 4.1 million exclude 1.1 million of non-recurring expenses. For the full-year of 2018, corporate costs of 5.6 million excluded non-recurring expenses of 2.4 million related to severance expense. Turning to our stock buyback program.

We repurchased 5,000 shares for $63,000 in the fourth quarter under our $10 million share repurchase program. Since the inception of this program, the third quarter of 2015 through the end of the fourth quarter of 2019, the Company's [Audio Gap] 33,000 shares for 8.3 million.

To accelerate buybacks activity, the Company completed a tender offer in March of 2019 for 247,000 shares of the Company's common stock for an aggregate cost of 3.7 million, excluding fees and expenses related to the tender offer.

The Company continues to view opportunistic share repurchases as an attractive use of capital and expects to continue its aggressive share repurchase strategy going forward.

As an example, on March 27, 2020, the Company completed transactions with certain shareholders to repurchase 259,000 shares of the Company's common stock for an aggregate cost of approximately 2.2 million, representing approximately 9% of the Company's shares outstanding as of the end of February 2020.

Note, these transactions were done at a price below our cash per share as of December 31, 2019. Following these transactions, the Company has approximately 2.7 million shares outstanding as of the end of March 2020. Turning back to our business.

As disclosed in our press release issued on March 13th, as well as our 2019 Form 10-K filed today, our business may be adversely impacted by the recent COVID-19 outbreak and the accompanying economic downturn.

This downturn as well as the uncertainty regarding the duration, speed and intensity of the outbreak has led to an initial reduction in demand for our services. Some of our customers have instituted temporary hiring freezes, while other customers that are more capable of working remotely have been allowed to operate more or less as usual.

The expected timeline for this reduction in demand for services remains highly uncertain and difficult to predict considering the rapidly evolving landscape. We are vigilantly monitoring the situation surrounding COVID-19 and will continue to proactively address the situation as it evolves.

We are confident we can continue to take appropriate actions to manage the business in this challenging environment due to the flexibility of our workforce and the strength of our balance sheet. To this end, we are cutting discretionary costs where we can and are prepared to further cut costs as necessary to protect our business.

That said we are trying to take a balanced approach to the situation. We don't want to overreact, nor under react as we remain focused and on our objective of maximizing shareholder value over the long-term.

Operator, can you please open the line for questions?.

Thank you, sir. [Operator Instructions] Our first question comes from Josh Vogel from Sidoti. Please go ahead..

Thank you. Good morning, Jeff and Matt, thanks for taking my questions and nice way to close out 2019. My first question, I think it would be helpful to get a better understanding around your client demographics and end-markets.

Could maybe any be classified as 'essential' and what are you doing to help them navigate through these uncertain times? And then maybe on a slight tangent, what work of any is still getting done through maybe a remote capability? Thank you..

Good question, Josh. I think there were three in there. So first off on our business mix, we have some really high quality clients they are mainly household names companies that you would all know, Fortune 500 type of companies that are in general healthy, has strong balance sheets and good credit ratings.

And our mix is roughly a third healthcare, a third financial services and a third other. And then within financial services, it is a healthy mix between commercial banking, investment banking, insurance, pension funds, even one central bank is in there. So it is a diverse collection of financial services.

And so some of those businesses are fairly defensive and will hold up better in an economic downturn. And certainly the healthcare, businesses and consumer goods are deemed essential and are running and producing.

I will say that pretty much globally, at least in our markets we are in, our clients are working from home, working remotely where they can and our teams are as well.

No, I was just going to say, we are engaging very actively with our clients and our employees and we are a partner, a talent - procurement talent management partner to our clients, and episodes like this, crises like this do show clients and potential clients the need to have a partner and then advisor to help them navigate these difficult times.

And so although economic activity has certainly being impacted, we are hopeful that some good things will come out of this situation over the long-term..

Great, and you actually - that led in or you answered my next question which was around, understanding that one of the biggest risks or fallout from what is going on could maybe be that clients may temper or lower the amount of employees they were looking to add over a certain period of time.

But on the other side of it, there is a tailwind or benefit that could arise from this and that is the need for a partner.

Are there any other tailwinds or benefits that you could see emerging from all this uncertainty out there?.

Sure. When clients are surveyed about what they like about the RPO model and working with a partner, one of the things they often say is flexibility and we provide partners the ability to flex up and down with their hiring needs.

And one thing that is helpful in that are these centers of excellence that we have around the world that can help clients ramp up and ramp down their hiring levels. And so I think companies that are going to think, rethink their business model and think, we need to have more flexibility.

Because it is a volatile world out there and we need a partner who can help us. I think it will strengthen demand for RPO overtime. So that could be a good thing to come out of this. And we also think, based on emerging from prior downturns that some clients will look to add contingent contractor type people before they add permanent employees.

And so our push into the contracting space we think will position us well for that environment..

Thank you for that. Shifting gears a little bit. We know how strong the balance sheet is especially entering or exiting 2019.

I was just hoping, you could share some insights around your overall liquidity position today?.

Yes sure. You know we do have some seasonality in our cash flows, at least historically it might not always be like this in the future. But Q4 tends to be a strong cash generating quarter. That has been true in recent years and was certainly true in 2019. Q1 tends to be a weaker cash generating quarter for a variety of reasons.

It is a slow period for us. It is also when bonuses are paid and we are a people business. We do think - we don't like to give guidance by quarter. We do think this year's first quarter will be much better than last year's first quarter in terms of earnings and cash flow generation.

And we are going to fight really hard to protect our cash generation abilities and also protect our balance sheet. Said another way, we are going to do everything in our power to not have any kind of meaningful cash burn going forward..

Okay. You have a little less than two million remaining on the current repurchase authorization.

Is it likely that you and the Board will increase this at some point?.

Short version is yes. We just were in a series of privately negotiated transactions last week. We just negotiated some private transactions to buyback 9% of our shares. And we did it below cash per share. So we are pretty excited about that from a value accretion point-of-view.

You know if a company can buy back stock below cash per share, it actually increases cash per share, in addition to increasing value per share, because the share count dropped more than the cash dropped. And having a strong balance sheet is really helpful to our business. We want to continue to have a strong balance sheet.

But we think at these stock price levels repurchasing shares is most attractive thing we can do. So as you mentioned, we still have 1.7 remaining on our authorization and when that is fully used up, I would expect us to institute a new buyback program..

That is great, it makes sense there. And then just one more please. Clearly a period of uncertainty and you know times like these suppress valuations, but also favorably position others with available capital like yourself.

So let's maybe flash forward a few months, I was just wondering if you can discuss your appetite for M&A activity, whether from a geographic or service perspective. And again, understanding there is so much uncertainty out there.

But do you think that EBITDA multiples could meaningfully contract to your benefit?.

It is certainly possible, we do look, we think it is helpful to be in the market and to look at things and we have learned quite a bit by doing that. I would say just in general, the environment we have been in until very, very recently was more of a seller's market than a buyer's market. Seller's had quite lofty expectations at times.

And so if one is value oriented the way we are, there can often be a gap between the bid and the ask and perhaps that gap closes more due to this environment. On the same token though visibility is really, really low right now. It is very hard to predict when things get better, how quickly they get better, at least for us.

I mean, we are in a client service business and we want to be - we talk to our clients all the time. We want to be closely attuned to the needs of our clients. We don't want to overreact. We don't want to under react. And it is hard looking at any kind of a target or M&A possibility.

It is hard to have a lot of confidence in the numbers that we are looking at in any kind of target, because there is just so much uncertainty in the environment right now..

Of course. That makes sense. Well, thank you guys for taking my questions and stay safe out there..

Thanks for your questions..

Thank you. Our next question comes from Adam Walder from Lismore Partners LLC. Please go ahead..

Hi, good day, gentlemen. Thank you very much for taking my questions. Clearly you guys were having terrific success here as you are exiting 2019 and obviously the COVID outbreak, you sort of have to turn on a dime. So I wonder, if you could give us a sense for a couple of things in terms of the macro environment.

Goldman Sachs is out with a forecast today for U.S. GDP to be down over 30% year-over-year in the second quarter. Global GDP for the second quarter could be down mid-to-high single digits. In that kind of environment with employment levels rising rapidly. I guess a two part question.

One is about how much of your revenue is tied to a conditional on employment levels per client? And then on a related point, can you give us a sense for how you would expect revenue to develop in the second quarter if something like Goldman Sachs’ Global GDP decline were to eventually..

Yes, it is really hard to have a lot of confidence in any forecast right now, and I applaud, people for trying. To us the big question is what do clients do for the full-year? And there are very few examples, at least right now, where clients have radically changed their plans for the year.

So in other words, if they hire fewer than planned in Q1, the big question hanging out there is do they make that back up in Q3 and Q4, in which case we need to be ready for that. Or is there a reduction in hiring volumes for the full-year, such that companies that tell us they are going to hire, say, 500 people this year end up only hiring 200.

And even our own clients don't know what they are going to do yet. Even if they had perfect knowledge - even if we had perfect knowledge into what they are thinking, they could change on a dime. And so it is just too early to say. And so what we have done in this environment is started to cut costs, where we can discretionary costs.

And we are prepared to do more. If this evolves into a, I don't want to say permanent reduction in an activity, or I would say a multi-quarter reduction in an activity as opposed to a one quarter reduction in activity..

That is tremendously helpful perspective. I wonder if we can turn to sort of capital allocation balance sheet for a minute. You touched on the notion of M&A in this environment and the sort of risks and potential opportunities there.

It seems like - and I don't want to put words in your mouth, but it seems like in terms of capital allocation prioritization that where there share is trading below cash per share. It is a pretty high bar to even think about M&A.

Is that a fair inference to take from a from an investment return standpoint, management distraction standpoint and all the rest..

That is a great way to put it. It is a high bar. It is not an impossible bar. But it is not a low bar. It is a high bar. And it is very attractive to buy back around stock at current levels. And so that is the obvious thing to do in our minds. And if a interesting acquisition target came along, and we do look at things.

We would look at it short-term, medium-term, long-term. We don't want to buy something just to buy something, or buy something just to get bigger. It has got to really fit into what we are doing.

So it has got to add something to the mix that makes us better geography, or a skill set that we don't have, or maybe a sector that we would like to be stronger in. And it would be much more likely to be on the smaller side than the bigger side.

We strongly believe in the lock runs sprint philosophy when it comes to something like that where you do one, see how it goes. And then if it goes well, you earn the right to do another one. But in this environment with great uncertainty, never say never if some phenomenal deal came along.

But anything compared to buying back stock at current levels is just a tough comparison because buying back stock is so incredibly attractive right now..

Absolutely and risk free. Thank you very much for taking my questions. Good luck in the coming quarters. And hopefully, things will be very strong for you on the other side of this..

Thank you..

Thank you. Our next question comes from It sounds from [Harry Zales from Zales Valley Partner] (Ph). Please go ahead..

Good morning. I want to start by saying congratulations on a strong year and that I really appreciate the discussion of shareholder value really throughout this call. At least for me, especially in this small cap space, especially with companies that are trading below cash like this.

There is a lot of managers that don't seem to really understand it the way that you all seem to - so it is really good to see that here with Hudson..

Thank you..

My first question, how would you describe how Hudson differentiates itself from your competition?.

That is a great question and it is incredibly hard to put it in a nutshell. But if when I tried to do it, probably the best - just a few phrases pop out. One is big company capability, but small company feel. We were rated in a industry survey number one in the industry on customer service. And we take a lot of pride in that.

Because of our small size, we are able to be nimble and customize things, tailor things, solutions to our clients and not have a cookie cutter approach. I would also say our real sweet spot is working with companies that hire 500 to 5,000 people per year.

And there is other companies, peers of ours, who work for companies that hire many, many more than that, companies that hire 10,000; 15,000; 20,000 a year.

And almost by definition, when you get to that size range, you have to have more of a cookie cutter, more of an automated one size fits all approach and our sweet spot is more in that 500 to 5,000 size. And it tends to be professional roles where getting the right talent is mission critical to success.

So for example, our clients are heavily in healthcare and even within that it is pharma, medical devices, Life Sciences, financial services where getting the right talent is just incredibly critical.

Someone that has - not to knock this at all, this is a great business to be in but, a client that has 20,000 factory workers, probably is going to be a better fit for one of our peers and for us..

Thank you.

In a similar vein, how long is your average client relationship been?.

It is hard to answer with precision. We have had clients. We had one client for almost 20-years. Our very first client was a well known pharmaceutical company that hired us in Australia about 20-years ago. And so that was an incredibly long relationship. We have many clients that have been with us for 10 years.

Contracts in this business, typically are three-years. And with a very high renewal rate, sometimes the contracts get renewed for three-years, sometimes it is two. Sometimes there is a one year extension before you do a three-year extension. So it is different by client and even by industry. But in general, we have long-term relationships.

We have long-term clients, and we have a very high renewal rates when contracts come up for renewal. That said, we are out trying to get new clients all the time. It is often companies that have never used an RPO before. And it is a very long sales cycle, because we have to educate them on the benefits of RPO.

And we are asking them to change how they have done talent procurement and talent management, versus how they have done it in some cases for decades. Occasionally, we win business from competitors, and occasionally we lose business to competitors.

But the vast majority of the time when we get new business it is a first time or what we call first time RPO, somebody who has never used RPO before. And almost always it ends up being a long-term relationship. And we have a really good track record of expanding those relationships once we get our foot in the door..

Alright, thank you. So you discussed that there has been some initial reduction in client business due to the COVID-19 issue.

How large has this been relative to your total revenues in the past on a percentage basis?.

Well, let me give you a few anecdotes that might be helpful. In a press release a few weeks ago, we did mention China, that was the first place that we saw weakness, which makes sense. China is less than 5% of our global revenue. And what we saw was very - well we always knew Q1 would be on the weaker side, it always is, because of Chinese New Year.

And it is just a weird coincidence that the virus started to hit that country around Chinese New Year. So the whole country was on holiday in late January. The first thing the government did was extend the national holiday. And then when people came back from holiday, everybody was pretty much ordered to work from home.

So we saw a huge reduction in activity defined as hiring volumes. It certainly didn't go to zero. But it was a significant decline. And that lasted about six weeks, and then rapidly returning to normal in China, it is not quite back to normal. A few weeks ago it might have been 70% back to normal, now it might be 90%, 95%, back to normal.

And we are hoping that is a similar pattern in other countries that sort of have to be impacted later. So, if you just think about that a very significant decline in activity for six weeks or so and then return to normal.

And the critical question that hasn't been answered yet and we won't know for several months, is that lower hiring volume in that six week period is that made up for later in the year or is it never made up for? We just don't know that yet..

Sure. Alright, well I appreciate those insights there. How much in costs could be cut in emergency situation? I know you have discussed that you are willing to do what it takes to make sure that we are not just burning through cash. Because obviously, especially with the opportunity to buy back stock below cash.

That is a very vital piece of our balance sheet and our strength. So yes how much could you, assuming this COVID-19, let's say it goes on for another year.

How much is in your comp if you cut that?.

Well, we have the fortune that we don't really have any assets in our business. It is all people. And so we could talk about how much of our cost structure is fixed or variable. But in some ways, it is pretty much all variable, because it is people.

What we have done thus far is what I would say is a discretionary cost reduction and that obviously there is no travel and entertainment right now. We have reduced our activity levels in certain places. It is very much a client-by-client basis. But some people are taking time off, taking vacation, there is some furloughs in a few places.

And we can do more of that if this turns into a year along downturn instead of a quick one quarter downturn. And so what we have done in prior downturns. We have done some reductions of our staff levels, but we have also done things to preserve that capability for when activity returns.

We have done some like four day work weeks or even three day work weeks. And we can do things like that again on a client-by-client basis. It is all about maximizing value over the long-term.

And so we don't want to overreact, we don't want to under react, said another way, we don't want to cut costs too little, because that could lead to losses and cash burn. But on the same token, if we cut too much and client activity demand rebound and we are not there to service our clients. That is very bad for a long-term shareholder value..

Right. Yes.

Could you give any hard figures in regard to that?.

It is really hard to do that at this time. But we will do everything in our power to not have losses and cash burn over any meaningful period of time..

I appreciate that and I have one last question for you. Are you looking at taking advantage of any government programs that may be available to you to strengthen the business? And if you could tell me a bit about that..

It is so rapidly evolving and we have actually created an internal team taskforce to monitor all of the programs being offered all around the world, just so we can keep track of them and take advantage of them, and these are anecdotes. But China for example is paying for two months of rent for people that experienced the disruption.

So we are taking advantage of that. The UK recently passed a measure where employers furlough employees and the government will reimburse wages up to 80% when the cap. And so we have taken advantage of that in one location and it is a really good way to preserve workforce capability. It is a good way to keep our team safe.

So they can be at home and isolate. But at the same time, they still have a job. They still have benefits. And it is in the government's interest to not have mass layoffs and you are starting to see programs to help company get through this difficult period. And so we have an internal taskforce.

We are staying on top of it, and we will partner with governments on these programs, wherever and whenever they become available..

Sure. What about once from the U.S.

governments?.

We are still analyzing those. About 25% of our business is in the Americas and obviously the U.S is the biggest country in that, but we also have Canada and some activity in Latin America. So we are studying it, but it just got finalized last week..

Right. And I imagine there is more to come as well..

Yes..

Alright. Well, in any case, I appreciate you taking my questions today. Have good day..

Thank you..

Thank you. [Operator Instructions] I show our next question comes from [Mark Dissent form Investor] (Ph). Please go ahead..

Well, hi. Thanks for taking the question. Just on that last question, how many employee do you have in say the U.S.

right now and globally?.

Sure. Probably a good way to answer that, and this is going to be kind of rough terms is that our business is 50% in Asia-Pac; 25%, UK, Europe; 25%; the Americas and we have about 400 employees globally. So the math across roughly we are - it might be a little bit less than that in the U.S., but the math is going to be roughly right there..

Okay, that is great.

Can you still hear me?.

Yes. .

Okay. Great. So I believe that would make you a small business under the U.S. stimulus plan.

Is that right?.

We are studying that. We think so. It is certainly true if the definition is just our U.S. employees..

I think it is 500 total, isn't it?.

Yes. You are right. We are we are under 500 total. So even if one looks at it globally, we are under 500 total..

Okay, that is great. So that would mean you get grants from the U.S.

Government's eventually assuming that you use it for - is that right, it sounds right?.

Potentially we are studying that..

Okay.

Is there a particular issue with that?.

Well, there is different programs that we have seen, some from the SBA, some from other organizations. And, if you participate in one program, you might not be able to participate in others and a lot of these were just passed last week. So we are studying it. And we will look into it and we are not going to let any opportunities pass us by..

Yes, I'm sure you will. That is great. Alright. That is terrific. And then on - you answered a lot of my questions.

So on the cash flow, is there any willingness of any of your customers to or any of them discussing helping you in any way or they are all worried about their own cash flow? Or would any of them - have you had any discussions about spreading out your cash flow somewhat, or is that not helpful to you?.

Well, the answer to that is yes. I think. So we talk to our clients all the time. And our clients tend to be smart and long-term oriented. And by smart, I mean they are not Pennywise and pound foolish. So if the discussion is often about what their need is, and what should our team size be to meet their needs.

And there have been times in the past, and I think there will be times now and also in the future where clients will request X, Y and Z. And they know it is a partnership. And they know that they are requesting X, Y and Z, they will have to pay for X, Y, and Z. And that is the way a partnership works.

And it is going to be there and it is going to work for all sides. Because we haven't seen any example of clients putting pressure on us, or trying to take advantage of the situation, or cut pricing or get out of contracts or anything like that. Our clients are long-term oriented, partnership oriented.

They are big companies with healthy balance sheets. And they are more trying to figure out how to navigate this crisis and looking for help and navigating the crisis..

That is terrific. And so the last thing is on the buyback that you mentioned. I know that you are limited by your NOLs at what you can do, and you just bought back, wherever it was close to 9% of your stock.

I know it is a difficult formula, but last year, you did a similar amount in the first quarter and then you kind of did only a small amount the rest of the year, I believe, unless you can correct me if that is false.

Would you imagine that that would probably tie your hands in a similar way this year or has something changed in the shareholder - large holder composition or something that changes the math that lets you do significantly more this year?.

Yes, you are right. This gets very complicated very quickly. The NOL calculations are very complicated. And unfortunately we have a thinly traded stock. And so we have done two things historically. One is have a ongoing 10b5 program that buys a little bit in the market.

And there are a lot of complicated rules around that in terms of how much volume we can buy, times of day we can trade and not trade, it can only be on an uptick, I think.

So, there is just a lot of days that even if we are in the market every day, there is just a lot of days that we just don't buyback very much stock, because our stock is thinly traded. And then from time-to-time, we have done bigger things like last year, we did the tender offer.

This time around, we had the opportunity to do a couple of privately negotiated transactions with stockholders that were wanting to reallocate in their portfolios and wanted to liquidity and wanted to reallocate. So we have done all of those things in the past and we will continue to do them in the future I think..

Okay. So, is there - I guess I'm not that familiar with all the rules, they are complicated for me. But besides the little-by-little programs you got going.

Is there a similar limit on what you can do from time-to-time if somebody calls you up and says I want to sell some shares or does that somehow free your hands under the rules and you can just buy whatever they offer?.

That is not an easy one to answer either. It is easier, if the window is open to do a trade with someone. If the window is not open and obviously it wasn't open last week when we did these trades. They have to sign a somewhat lengthy legal agreement that says they acknowledge that the Company has material non-public information, they don't.

So they are acknowledging the information asymmetry and they want to do the trade anyway. So you can imagine that from the time the discussion started. We drafted the document, send it to them, legal reviewed it, finally got it signed off.

There is just a lot of stockholders out there that just wouldn't want to mess with that or wouldn't want to sign a document like that. We found two significant stockholders, who were willing to trade and those circumstances and we are willing to sign that document. And so that enabled us to do these privately negotiated transactions..

Okay, that is great. But it is still within about the same amount that you bought last year as a percentage. So my question is whether once the window is open.

Can you go meaningfully higher under the NOL rules? Or are other rules under the NOL thing that limit your ability to do private transactions to or is it depend on whether it is 5% shareholder or not that is doing the sale?.

Yes the 5% shareholder thing does come into play, because we have to watch the shareholding for those who are above 5%. And then every time, we shrink the share count, someone who is above five actually goes up, if they are not participating in the buyback.

So that gets complicated, but it is also true that most tax attorneys would advise clients that if they have an NOL to be careful about exceeding 10% in any one year. So it's not a hard and fast rule, but it is a guidance that is given.

So there is circumstances where we would stay below that and then there is other circumstances where we would go above it, despite the potential risk..

Okay. Thank you very much. That is all I have. Thanks very much for all your help today..

Sure. Thanks for the questions..

Thank you. This concludes today's question-and-answer session. I will now turn the call over to Jeff Eberwein for closing remarks..

Thank you all again for joining us today and your interest in Hudson Global. We look forward to next quarter's update call. Thank you..

Thank you for joining the Hudson Global fourth quarter conference call. Today's call has been recorded and will be available on the investor section of our website hudsonrpo.com. You may now disconnect..