For the past quarter, we have placed our effort in implementing the first version of the ModelBased Iterative Reconstruction (MBIR) algorithm, assembling and testing the electronics, designing transducers mounts, and defining our laboratory test samples. We have successfully developed the first implementation of MBIR for ultrasound imaging. The current algorithm was tested with synthetic data and we are currently making new modifications for the reconstruction of real ultrasound data. Beside assembling and testing the electronics, we developed a LabView graphic user interface (GUI) to fully control the ultrasonic phased array, adjust the time-delays of the transducers, and store the measured reflections. As part of preparing for a laboratory-scale demonstration, the design and fabrication of the laboratory samples has begun. Three cement blocks with embedded objects will be fabricated, characterized, and used to demonstrate the capabilities of the system. During the next quarter, we will continue to improve the current MBIR forward model and integrate the reconstruction code with the LabView GUI. In addition, we will define focal laws for the ultrasonic phased array and perform the laboratory demonstration. We expect to perform laboratory demonstration by the end of October 2015.