Capital Stock Transactions

Stock Option Plans

As of June 30, 2018, the Company had in effect two employee stock option plans that provide for incentive and non-qualified stock options. After accounting for shares issued upon exercise of options, a total of 367,500 shares of the Company’s common stock remain available for issuance as of June 30, 2018. Under the terms of the plans, options may not be granted for less than the fair market value of the Common Stock at the date of grant. Vesting generally occurs ratably between one and five years and for non-employee directors, immediately, and the options are exercisable over a period no longer than 10 years after the grant date. As of June 30, 2018, options to purchase 367,500 shares of the Company’s common stock were outstanding, of which 367,500 were exercisable, and 0 shares were unvested.

The following is a summary of Escalon’s stock option activity and related information for the fiscal years ended June 30, 2018 and 2017:



	2018				2017
	Common Stock Options		Weighted Average Exercise Price		Common Stock Options		Weighted Average Exercise Price
Outstanding at the beginning of the year	502,000		$	2.12	616,500		$	2.27
Granted	—		—		—		—
Exercised	—		—		—		—
Forfeited	(134,500	)	3.05		(114,500	)	$	2.65
Outstanding at the end of the year	367,500		$	1.78	502,000		$	2.12
Exercisable at the end of the year	367,500		$	1.78	502,000		2.12
Weighted average fair value of options granted during the year			$	—			$	—

The following table summarizes information about stock options outstanding as of June 30, 2018:



	Number Outstanding at June 30, 2018	Weighted Average Remaining Contractual Life (Years)	Weighted Average Exercise Price		Number Exercisable at June 30, 2018	Weighted Average Exercise Price
Range of Exercise Prices
$0.79	21,000	7.5	$	0.79	21,000	$	0.79
$1.51 to $1.57	192,000	4.54	$	1.55	192,000	$	1.55
$2.21	154,500	0.42	$	2.21	154,500	$	2.21
Total	367,500				367,500

There was no compensation expense related to stock options for the years ended June 30, 2018 and 2017,

Preferred stock

On February 14, 2018, the Company entered into a Debt Exchange Agreement (the “Exchange Agreement”) with Mr. DePiano, the Company's Chairman and DP Associates Inc. Profit-Sharing Plan of which Mr. DePiano is the sole owner and sole trustee (the “Holders”). Pursuant to the terms of the Exchange Agreement, effective February 15, 2018, the Holders exchanged a total of $645,000 principal amount of debt related to the accounts receivable factoring program the Company owes the Holders for 2,000,000 shares of Series A Convertible Preferred Stock (the “Preferred Stock”). (see note 11)