8-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): November 20, 2008

Escalon Medical Corp.
__________________________________________
(Exact name of registrant as specified in its charter)

Pennsylvania	000-20127	330272839
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
435 Devon Park Drive, Building 200, Wayne, Pennsylvania		19087
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

Registrant’s telephone number, including area code: 610-688-6830

Not Applicable
______________________________________________
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

In connection with the private placement disclosed in Section 3.02 of this Form 8-K report, which disclosure is incorporated by reference into this item, the Company entered into a Securites Purcahse Agreement, a Registration Rights Agreement and Warrants to purchase common stock of the Company with the investors. The Registration Rights Agreement requires the Company to prepare and file with the Securities and Exchange Commission a registration statement covering the resale of all of the shares sold in the private placement and the shares issuable upon exercise of the warrants (the "registrable securities") for an offering to be made on a continuous basis pursuant to Rule 415. Subject to the terms of the Registration Rights Agreement, the Company is required to use best efforts to cause the registration statement to be declared effective under the Securities Act as promptly as possible after the filing thereof, and shall use best efforts to keep the registration statement continuously effective under the Securities Act until the earlier of the date when all registrable securities covered by the registration statement have been sold or the date after while the shares may be sold pursuant to an exemption from registration under the Securities Act.

Item 3.02 Unregistered Sales of Equity Securities.

On November 20, 2008, the Company completed a $1,100,000 private placement of common stock and common stock purchase warrants to accredited investors. The Company sold 1,000,000 shares of common stock at $1.10 per share. The investors also received warrants to purchase an additional 150,000 shares of common stock at an exercise price of $1.21 per share. The warrants have a term of five years, but cannot be exercised for 181 days after issuance. The net proceeds to the Company from the offering of the 1,000,000 shares of common stock, after fees and expenses, will be approximately $1,029,000.

Item 9.01 Financial Statements and Exhibits.

Exhibit 99.1 Press released dated November 21, 2008.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Escalon Medical Corp.
November 21, 2008	By:	Richard J. DePiano, Jr.
		Name: Richard J. DePiano, Jr.
		Title: President & General Counsel

Exhibit Index

Exhibit No.	Description
99.1	Press Release dated November 21, 2008

EX-99.1

ESCALON MEDICAL CORP.

565 East Swedesford Road, Suite 200

Wayne, PA 19087

(Nasdaq Capital Market: ESMC)

AT THE COMPANY	AT FINANCIAL RELATIONS BOARD
Richard J. DePiano Chairman and CEO	Joseph Calabrese 212/827-3772

610/688-6830

ESCALONâ MEDICAL CORP. COMPLETES $1.1 MILLION
PRIVATE EQUITY FINANCING

Wayne, PA – November 21, 2008 — Escalon Medical Corp. (Nasdaq Small Cap: ESMC) today announced that on November 20, 2008 has completed a $1,100,000 private placement of common stock and common stock purchase warrants to accredited and institutional investors. The Company sold 1,000,000 shares of common stock at $1.10 per share. The investors also received warrants to purchase an additional 150,000 shares of common stock at an exercise price of $1.21 per share. The warrants cannot be exercised for 181 days. The net proceeds to the Company from the offering, after fees and expenses, will be approximately $1,029,000. Barrett & Company of Providence Rhode Island, acted as placement agent on behalf of the Company in the private placement.

“As the world is captivated by the magnitude of the unfolding economic crisis, which led to a dramatic increase in the cost of capital; we thought it prudent to secure private equity financing at this time. We believe that the new funding will enable us to strengthen our balance sheet and provide additional working capital for general corporate purposes during this trying economic environment,” commented Richard J. DePiano, Chairman and Chief Executive Officer.

As the result of the private placement, Escalon Medical will have 7,413,930 shares of common stock outstanding, not including the shares issuable upon the exercise of the warrants.

The shares were offered in reliance on an exemption from the registration requirements of the Securities Act of 1933 (the “Securities Act”). The offering has not been registered under the Securities Act or any state securities laws, and the shares may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws. Escalon Medical has agreed to file a registration statement covering the resale by the investors of the shares purchased and shares issuable upon exercise of the warrants. This press release does not and shall not constitute an offer to sell or the solicitation of an offer to buy shares or warrants and is being issued under Rule 135c under the Securities Act.

Founded in 1987, the Company (http://www.escalonmed.com) develops markets and distributes ophthalmic diagnostic, surgical and pharmaceutical products as well as vascular access devices. Drew Scientific, which operates as a separate business unit, provides instrumentation and consumables for the diagnosis and monitoring of medical disorders in the areas of diabetes, cardiovascular diseases and hematology, as well as veterinary hematology and blood chemistry. The Company seeks to utilize strategic partnerships to help finance its development programs and is also seeking acquisitions to further diversify its product line to achieve critical mass in sales and take better advantage of the Company’s distribution capabilities, although such partnerships or acquisitions may not occur. The Company has headquarters in Wayne, Pennsylvania and operations in Long Island, New York, New Berlin, Wisconsin, Lawrence, Massachusetts, Dallas, Texas, Waterbury, Connecticut, Miami, Florida and Barrow-in-Furness, U.K.

Note: This press release contains statements that are considered forward-looking under the Private Securities Litigation Reform Act of 1995, including statements about the Company’s future prospects. These statements are based on the Company’s current expectations and are subject to a number of uncertainties and risks, and actual results may differ materially. The uncertainties and risks include whether the Company is able to:

• implement its growth and marketing strategies, improve upon the operations of the Company business units, including the ability to make acquisitions and the integration of any acquisitions it may undertake, if any, of which there can be no assurance,

• implement cost reductions,

• generate cash,

• identify, finance and enter into business relationships and acquisitions

• new product development, commercialization, manufacturing and market acceptance of new products,.

Other factors include uncertainties and risks related to:

• marketing acceptance of existing products in new markets,

• research and development activities, including failure to demonstrate clinical efficacy,

• delays by regulatory authorities, scientific and technical advances by the Company or third parties,

• introduction of competitive products,

• ability to reduce staffing and other costs and retain benefit of prior reductions

• third party reimbursement and physician training, and

• general economic conditions.

Further information about these and other relevant risks and uncertainties may be found in the Company’s reports on Form 10-K for year ended June 30, 2008 and Form 10-Q for the quarter ended September 30, 2008, and its other filings with the Securities and Exchange Commission, all of which are available from the Securities and Exchange Commission as well as other sources.