Note 16 — Subsequent Events

Resignation of a Director

Effective November 3, 2015, Stanley Hirschman retired as one of our directors.

Reverse Stock Split

On October 6, 2015, 20 calendar days had passed since the mailing to our shareholders of the Definitive Schedule 14C filed on September 11, 2015 regarding the approval by our Board of Directors and shareholders of a reverse stock split of our common stock, in a ratio to be determined by our board of directors, of not less than 1-for-400 nor more than 1-for-1000 and on October 7, 2015, we effected a 1-for-1000 reverse split of our common stock. All warrant, option, share and per share information in this annual report gives retroactive effect for a 1-for-1000 split. All numbers in these financial statements and in this Annual Report on Form 10-K to which these financial statements are appended gives effect to all financial information as if the reverse split had occurred on the date reported, except as otherwise noted.

Common Share Issue – Board of Directors

On November 5, 2015, pursuant to the Board of Directors resolution on July 14, 2015, Optex Systems issued 99,000 common shares to the independent board members. Each independent board member was issued 21,000 shares, with 7,000 shares immediately vested, and the remaining 14,000 shares to be vested over two years, at 50% per year on the grant date anniversary. Each committee chair member was granted an additional 5,000 shares, which were immediately vested on issuance.