UNITED STATES SECURITIES AND EXCHANGECOMMISSIONS      

WASHINGTON D.C. 20549 

FORM 10-QSB/A 

AMENDED QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THESECURITIES  

EXCHANGE ACT OF 1934. 

For the quarterly period ended:
June 30 2000

Commission File Number:
000-27793

 

 
**ELECTRONIC SYSTEMS TECHNOLOGY,INC.
(Exact name of registrant as specified in its charter)
**ELECTRONIC SYSTEMS TECHNOLOGY, INC.

(A Washington Corporation)

I.R.S. Employer Identificationno.
91-1238077

 

415 N. Quay St., #4

Kennewick  WA  99336

Registrant's telephone number, including area code:
(509) 735-9092

 

Check whether the issuer (1) has filed all reports required to be filed bySection 13 or 15(d) of the Exchange Act during the past 12 months (or for suchshorter period that the registrant was required to file such reports), and (2)has been subject to such filing requirements for the past 90 days.  Yes  [ X ]No [    ] 

	 

The number of shares outstanding of common stock as of June 30, 2000 was5,068,667. 
**PART I - FINANCIALINFORMATION**Item 1.  FINANCIAL STATEMENTS. 
**ELECTRONIC SYSTEMSTECHNOLOGY, INC.
(as prepared by Management) 

(Unaudited) 

Six Months Ended
June 30, 2000
June 30, 1999
Sales
$        588,926
$     511,486
Other Revenues
109,165
91,186
Gross Profit
265,435
241,764   
Net Income (Loss) Before Taxes	
(29,398)
(52,601)
Net Income (Loss) After Taxes
(19,402)
(34,716)   
Earnings (Loss) Per Share Before Taxes  
Basic
$  (       0.005)
$  (       0.01)
Diluted
(       0.005)
(       0.01)   
Earnings (Loss) Per Share After Taxes  
Basic
$  (      0.004)
$  (      0.01)
Diluted
(      0.004)
(     0.01)   
Weighted Average Shares Outstanding (Basic)  
Primary
5,679,996
5,590,927
Diluted
5,679,996
5,590,927   
Total Assets
$        2,438,646
$   2,281,656   
Long-Term Debt and Capital Lease  
   Obligations
$                      0
$                0   
Shareholders' Equity
$        2,264,800
$  2,157,735   
Shareholders' Equity Per Share
$                 0.44
$           0.44   
Working Capital
$        2,081,185
$   1,983,369   
Current Ratio
13:1
17 : 1   
Equity To Total Assets
93%
95%   

 

 

 

 
**ELECTRONIC SYSTEMSTECHNOLOGY, INC. 

BALANCE SHEET 

(as prepared by Management) 

(Unaudited) 

 

June 30, 2000
Dec. 31 ,1999
ASSETS  
CURRENT ASSETS
		 
Cash and cash equivalents
$             1,573,510
$       1,624,728 
Accounts Receivable, net of allowance  
   for uncollectibles
148,065
         154,788 
Inventory
499,202
         357,490 
Accrued Interest
8,583
             5,415 
Prepaid Expenses
9,675
             5,652
Provision for Federal Income Taxes
                 15,996
             5,045
Total Current Assets
$            2,255,031
$     2,153,118   
PROPERTY & EQUIPMENT net of  
   Depreciation of $297,595 at  
   June 30, 2000 and $278,821  
   At Dec. 31, 1999
175,372
        145,123
		  
OTHER ASSETS
                    8,243
             9,474
TOTAL ASSETS
$           2,438,646
$    2,307,715   
LIABILITIES & STOCKHOLDERS' EQUITY     
CURRENT LIABILITIES  
Accounts Payable
$                50,940
$         36,607
Refundable Deposits
100,450
--
Deferred Tax Liability 
816
           816
Accrued Liabilities
                21,640
           25,540
Total Current Liabilities	
              173,846
           62,963   
STOCKHOLDERS' EQUITY  
Common Stock,  $.001 Par Value  
50,000,000 Shares Authorized  
5,068,667 Shares Issued And Outstanding	
$                 5,069
$           4,954  
Additional Paid-in Capital
933,464
         894,129  
Retained Earnings
            1,326,267
       1,345,669

$          2,264,800
$     2,244,752   
TOTAL LIABILITIES AND STOCKHOLDERS'  
   EQUITY
$           2,438,646
$     2,307,715     

(See "Notes to Financial Statements")

 

 

 
**ELECTRONIC SYSTEMSTECHNOLOGY, INC. 

STATEMENT OF OPERATIONS
(as prepared by Management) 

(Unaudited) 

 

 
Three Months Ended
Six Months Ended 
June 30, 2000
June 30, 1999
June 30, 2000
June 30, 1999     
SALES
$360,513
$     331,752
$588,926
$   511,486
COST OF SALES    
Beginning Inventory
$     470,842
$     443,012
$      357,490
$   385,365
Purchases and Allocated Costs
228,057
151,095
465,203
301,871

698,899
     594,107
822,693
   687,236
Ending Inventory
499,202
417,514
499,202
417,514
Total Cost of Sales
$     199,697
$     176,593
$     323,491
$    269,722
Gross Profit
$     160,816
$     155,159
$     265,435
$    241,764     
OPERATING EXPENSES    
Finance/Administration
$       44,312
$      37,939
$       91,796
$    107,181
Research & Development
40,470
            40,823
90,382
84,411
Marketing
58,888
63,020
114,448
106,956
Customer Service
27,895
   14,384
$       50,790
32,504
Total Operating Expense
$     171,565
$     156,166
$     347,416
$    331,052
OPERATING INCOME (LOSS)
$    (10,749)
$      (1,007)
$     (81,981)
$   (89,288)     
Other Income (expenses)    
Interest Income
$        19,992
$       15,090
$          38,576
$       30,067
Engineering Services
28,467
20,676
70,589
61,119
Engineering Support
(21,113)
( 19,148)
(56,582)
( 54,498)
Net Other Income (expense)
$        27,346
$       16,618
$         52,583
$      36,688     
NET INCOME (LOSS) BEFORE TAX
$        16,597
$       15,611
(29,398)
$    (52,601)
Provision For Income Tax
(5,643)
(5,307)
9,996
17,885     
NET INCOME (LOSS)
$       10,955
$        10,304
$       (19,402)
$    (34,716)     
Basic Earnings  (Loss) Per Share    
         Before Tax
$         0.003
$         0.003
$ (       0.005)
$ (       0.01)
Basic Earnings  (Loss) Per Share 

  
         After Tax
$         0.002
$         0.002
$ (       0.004)
$ (       0.01)     
Diluted Earnings (Loss) Per Share    
         Before Tax
$         0.003
$         0.003
$ (      0.005)
$ (      0.01)
Diluted Earnings (Loss) Per Share

  
         After Tax
$         0.002
$         0.002
$ (     0.004)
$ (     0.01)

(See "Notes to Financial Statements") 
**ELECTRONIC SYSTEMSTECHNOLOGY, INC. 

STATEMENT OF CASH FLOWS
 (as prepared by Management) 

 (Unaudited) 

Six Months Ended
June 30, 2000
June 30, 1999   
CASH FLOWS PROVIDED (USED) IN OPERATING ACTIVITIES:   
Net Income (Loss)
$(19,402)
$  (    34,716)
Noncash items included in income:  
      Depreciation
18,774
14,879
      Amortization
1,231
1,173
      Provision for Federal Income Taxes
(10,951)
(32,885)   
DECREASE (INCREASE) IN CURRENT ASSETS:
Accounts Receivable Net
6,723
174,225
Inventory
(141,712)
(  32,149)
Prepaid Expenses
(4,023)
(2,107)
Accrued Interest
(3,168)
2,699   
INCREASE (DECREASE) IN CURRENT LIABILITIES:
Accounts Payable and Accrued Expenses 
10,433
1,754
 Refundable Deposits
100,450
      --
Accrued Federal Income Taxes
--
(  14,510)
Deferred Income
--
(    25,017)

$(41,645)
$    53,346
CASH FLOWS PROVIDED (USED) IN INVESTING ACTIVITIES:
Additions To Property And Equipment
$(49,023)
$    ( 65,507)
Capitalized Software
--
(3,725)
Deposits; application of mold deposit to property
--
26,250

$(49,023)
$   ( 42,982)
CASH FLOWS PROVIDED (USED) IN FINANCING ACTIVITIES:
Common Stock Issued through exercised stock options
$       115
$              --
Additional Paid In Capital from exercised stockoptions
    39,335
               -- 
$  39,450
$             --
NET INCREASE (DECREASE) IN CASH AND  
    CASH EQUIVALENTS
$   (51,218)
$   10,364
Cash And Cash Equivalents  
    At Beginning Of Period
  1,624,728
1,426,381
Cash And Cash Equivalents At Ending of Period	
$1,573,510
$  1,436,745   
SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION:
Cash Paid Year To Date:  
Interest
$                0
$                0
Federal Income Taxes
$            955
$       19,510
Cash allocated for Cash Distribution
$                0
$       49,537   
Cash And Cash Equivalents:  
Cash
$6,659
$         6,648
Money Market Accounts
543,796
499,636
Certificates Of Deposit
1,023,055
930,461
	  	 
$   1,573,509
$  1,436,745
**(See "Notes to FinancialStatements")
**ELECTRONIC SYSTEMSTECHNOLOGY, INC. 

NOTES TO FINANCIAL STATEMENTS

(as prepared by Management)

(Unaudited)
**NOTE 1 - BASIS OFPRESENTATION
The financial statements of ElectronicSystems Technology, Inc. (the "Company"), presented in this Form 10Qare unaudited and reflect, in the opinion of Management, a fair presentation ofoperations for the three and six month periods ending June 30, 2000 and June 30,1999. Certain information and footnote disclosure normally included in financialstatements prepared in accordance with generally accepted accounting principalshave been condensed or omitted pursuant to the applicable rules and regulationsof the Securities and Exchange Commission. These financial statements should beread in conjunction with the audited financial statements and notes theretoincluded in the Company's Form 10K for the year ended December 31, 1999 as filedwith Securities and Exchange Commission.

The results of operation for the three and six month periodsended June 30, 2000 and June 30, 1999, are not necessarily indicative of theresults expected for the full fiscal year or for any other fiscal period.
**NOTE 2 - INVENTORIES

Inventories are stated at lower of costor market with cost determined using the FIFO (first in, first out) method.Inventories consist of the following:

 
June 30,  2000 
December 31 

1999
Parts
$346,079 
$ 256,334
Work in progress
17,080 
52,279
Finished goods
136,043 
48,877 
$499,202 
$ 357,490
**NOTE 3 - EARNINGS (LOSS)PER SHARE 

Basic and diluted loss per share forthe six month period ended June 30, 2000, is computed by dividing loss by thenumber of common shares outstanding for the period, excluding equivalent sharesfrom possible stock option exercises, the effect of which would be anti-dilutive. The number of common shares outstanding used for calculation of basicand diluted loss per share was 5,068,667 for the six month period ended June 30,2000.

Basic Earnings Per Share (EPS) excludes dilution and iscomputed by dividing income available to common stockholders by the weighted-average number of common shares outstanding for the period.  Diluted EPSreflects potential dilution occurring if securities or other contracts to issuecommon stock were exercised or converted into common stock or resulted in theissuance of common stock that then shared in the earnings of the Company.  Theprimary weighted average number of common shares outstanding was 5,679,996 and5,590,927 for the quarters ended June 30, 2000 and 1999 respectively.

For the Quarter Ended  June 30,2000 
Income

(Numerator)
Shares

(Denominator)
Per-Share

Amount
Basic EPS

Income available to common     stockholders
$10,955
5,679,996
$0.002

Diluted EPS

Income available to common stockholders+assumedconversions
$10,955
5,668,667
$0.002

 
**NOTE 4 - STOCKOPTIONS

As of June 30, 2000, the Company hadoutstanding stock options that have been granted periodically to individualemployees and directors with no less than three years of continuous tenure withCompany. On February 11, 2000, additional stock options to purchase shares ofthe Company's common stock were granted to individual employees and directorswith no less than three years continuous tenure.  The options granted onFebruary 11, 2000 totaled 220,000 shares under option and have an exercise priceof $2.81 per share.  The options granted on February 11, 2000 may be exercisedany time during the period from February 11, 2000 through February 10, 2003.The Company's Form 8-K dated February 11, 2000, as filed with the Securities andExchange Commission is included herein by reference.  All outstanding stockoptions must be exercised within 90 days after termination of employment. Duringthe 12 month period from June 30, 1999 to June 30, 2000, 160,000 shares underoption expired, 115,000 shares under option were exercised, and 220,000 sharesunder option were granted.  At June 30, 2000 there were 600,000 shares underoption reserved for future exercises.

The Company has adopted the disclosure-only provisions ofStatement of Financial Accounting Standards (SFAS) No. 123, "Accounting forStock-Based Compensation." The Company undertakes to make disclosures andcalculations pursuant to SFAS 123 on an annual basis coinciding with theissuance of the Company's Annual Financial Statements. Accordingly, nocompensation cost has been recognized for the stock option plan. 
**NOTE 5 - RELATED PARTYTRANSACTIONS
For the six month period ended June 30, 2000, services in theamount of $31,732, were contracted with Manufacturing Services, Inc., of whichthe owner/president is a member of the Board of Directors of the Company. 
**NOTE 6 - CASHDISTRIBUTION

On June 11, 1999, the Companydeclared a one-time, non-cumulative, cash distribution to shareholders of recordas of June 25, 1999, of $0.01 per share of common stock, with a payable date ofJuly 9, 1999.  The payment of the cash distribution was completed by July 9,1999.  For the quarter ended June 30, 1999, the Company recognized a currentliability in the amount of $49,537, reflecting the total dollar value of thecash distribution.  
** 

 
**ITEM II

                                        MANAGEMENT'SDISCUSSION AND ANALYSIS OF FINANCIAL 

                                                    CONDITIONAND RESULTS OF OPERATION 
***Management's discussion andanalysis is intended to be read in conjunction with the Company's unauditedfinancial statements and the integral notes thereto for the quarter ending June30, 2000.  The following statements may be forward looking in nature and actualresults may differ materially.
**A.  Results ofOperations**REVENUES:
Total revenues from the sale of the Company's ESTeemÔ wireless modem systems, accessories, and services increased to $388,980 for thesecond quarter of 2000, reflecting a 10% increase when compared to $352,428 forthe second quarter of 1999. Gross revenues increased to $408,972 for the quarterended June 30, 2000, from $367,518 for the same quarter of 1999.  Increasedsales of the Company's products for industrial automation projects during thesecond quarter of 2000 is responsible for the increased sales revenues, whencompared with the same quarter for 1999. 

The Company's revenues fall into threemajor customer categories, Domestic, Export and U.S. Government sales.  Domesticcommercial sales increased to $355,321 in the second quarter of 2000, ascompared to $290,721 for the second quarter of 1999, due to increased productsales to for industrial automation projects.  During the second quarter of 1999,the Company had experienced reduced product sales revenues in the industrialautomation market, due to, in Management's opinion, decreased demand inautomated control projects in the short term, and competitive pressures fromalternative product providers.  During the second quarter of 2000, this trendwas reversed in the near term.  The lengthy purchase cycles for industrialautomation projects where the Company's products are used makes prediction oftrends difficult. 

Foreign export sales for the second quarter of 2000 decreasedto $29,232 as compared to the $36,004 in the same quarter of 1999. Managementbelieves the reduction in foreign export sales is a continuation of slow foreignsales experienced during 1999, which may continue in the near term, butuncertainty of foreign sales makes trends difficult to predict.

U.S. Government sales decreased to $4,426 in the secondquarter of 2000, a decrease from second quarter 1999 U.S. Government sales of$25,703. Management believes the decreased U.S. Government sales is a result ofa continued lack of new projects and purchases for the Company's products, whichwas experienced throughout 1999. Due to the uncertain nature of U.S. Governmentpurchasing, Management does not base profitability or liquidity projections onexpected U.S. Government sales.

During the quarter ended June 30, 2000 material and servicesprovided to the Blaine County, Idaho Sheriff's Department and the City ofGainesville, Texas, Police Department accounted for 19% and 15% of the Company'ssales and service revenues, respectively.  No other sales to a single customercomprised 10% or more of the Company's product sales for the quarter ended June30, 2000. 

A percentage breakdown of EST's majorcustomer categories of Domestic, Export and U.S. Government Sales, for thesecond quarter of 2000 and 1999 are as follows: 

					   

For the second quarter of 
2000
1999
Domestic Sales
91%
83%
Export Sales
8%
10%
U.S. Government Sales
1%
7%

A percentage breakdown of EST's product sales categories forthe second quarter of 2000 and 1999 are as follows: 

For the Quarter Ended June 30 
2000
1999
ESTeem Model 192
61%
57%
ESTeem Model 95
4%
3%
ESTeem Model 96
4%
1%
ESTeem Model 84SP/85SP
1%
--
ESTeem Accessories
21%
31%
Factory Services
2%
2%
Site Support
7%
6%
Sales for the second quarter of 2000 and 1999 include foreignexport sales as follows:

Three Months Ended
June 30, 2000
June 30, 1999
Export sales
$     29,232
$     36,004
Percent of sales
8%
10%
The geographic distribution of foreign sales for the secondquarter of 2000 and 1999 is as follows:

Percent of Foreign Sales
COUNTRY
June 30, 2000
June 30, 1999
South Korea
38%
--
Turkey
19%
--
Brazil
18%
11%
Israel
13%
--
India
12%
--
Mexico
--
59%
Ecuador
--
18%
Indonesia
--
8%
Canada
--
3%
Thailand
--
1%
The majority of the Company's domestic sales for the secondquarter of 2000 were used in Industrial Automation applications. 

Industrial Automation applications have historically been themajority of the Company's domestic sales, which Management believes willcontinue for the foreseeable future, but will also be, augmented by sales ofMobile Data Computer Systems for public safety entities.  It is Management'sopinion that the majority of foreign export applications will continue to be inIndustrial Automation applications for the foreseeable future.

Based on previous sales activity, the majority of all U.S.Government purchases are expected to be under the Company's General ServicesAdministration (GSA) contract.  Projections regarding liquidity, profitability,and material purchases are based on past history of annual purchases.Historically, Federal sales average approximately 18% of annual sales, but thislevel cannot be guaranteed. Due to the uncertain nature of Federal purchasing,procurement of material and production planning is adjusted quarterly based ondemand. It is Management's opinion that the majority of Federal purchases in2000 will be under this contract.

The Company's revenues have historically fluctuated fromquarter to quarter due to timing factors such as customer order placement andproduct shipments to customers, as well as customer buying trends, and changesin the general economic environment. The procurement process regarding plant andproject automation, or project development, which usually surrounds the decisionto purchase ESTeem products can be lengthy. This procurement process may involvebid activities unrelated to the ESTeem products, such as additional systems andsubcontract work, as well as capital budget considerations on the part of thecustomer.  Because of the complexity of this procurement process, forecasts inregard to the Company's revenues become difficult to predict. 
**BACKLOG:
The Corporation had backlog of $155,000 as of June 30, 2000.Order backlog delivery expected in early in the 3rd Quarter of 2000,or is part of ongoing large-scale public safety Mobile Data Computer (MDC)projects. Customers generally place orders on an "as needed basis".  Shipment isgenerally made within 5 to 10 working days after receipt of an order from acustomer.
**COST OF SALES:
Cost of sales percentage for the second quarters of 2000 and1999 was 55% and 53%, respectively.  Cost of Sales variation is normallyattributed to the types of product sold and the size of the order.  Largerorders grant lower sales prices because of volume discounting, reducing themargin of profit.  The increase in cost of sales in the second quarter of 2000is due to a combination of decreased sales prices and product mix.
**OPERATINGEXPENSES:
Operating expenses for the second quarter of 2000 were$15,399 higher than the second quarter of 1999.  The following is a delineationof operating expenses: 

For the quarter ended:
June 30, 2000
June 30, 1999
Increase (Decrease)
Finance/Administration
$   44,312
$   37,939
$     6,373
Research/Development
40,470
40,823
(       353)
Marketing
58,888
63,020
(    4,132)
Customer Service
27,895
14,384
    13,511
Total Operating Expenses
$ 171,565
$ 156,166
$    15,399**FINANCE ANDADMINISTRATION:
During the second quarter of 2000,Finance and Administration expenses increased $6,373 from the second quarter of1999.  Increases in professional services charges billed to the Company andincreases in printing costs and postage associated with Company administrationare responsible for the increased expenses when compared with the same quarterof 1999. 
**RESEARCH ANDDEVELOPMENT:
During the second quarter of 2000, Research and Developmentexpenses decreased $353 from the same period in 1999.  The decrease isattributable to timing differences in salaries within the department whencompared with the same quarter of 1999.**MARKETING:
During the second quarter of 2000, Marketing expensesdecreased $4,132 from the same period in 1999.  The decrease is the result oflower printing services and postage expenses during the second quarter of 2000.
**CUSTOMERSERVICE:
Customer service expenses increased $13,511 in the secondquarter of 2000 as compared with the second quarter of 1999.  The increase isattributable to increased salaries and wages due to the addition of employees tothe department, as well as increased travel expenses during the quarter endedJune 30, 2000, when compared with the same period of 1999.
**INTERESTINCOME:
The Corporation earned $19,992 in interest income during thequarter ended June 30, 2000.  Sources of this income were savings and moneymarket accounts, and short term investments. 
**ENGINEERINGSUPPORT:
Engineering support costs increased to $21,113 for thequarter ended June 30, 2000, as compared to $19,148 for the same period of 1999.This increase in engineering support costs for the second quarter of 2000 is aresult of an increase in engineering services performed by the Company forcustomers when compared with the second quarter of 1999.  
**NET INCOME(LOSS): 
The Company had a net income of $10,955 for the secondquarter of 2000, compared to a $10,304 net income for the same quarter of 1999.The net income increase is attributable to increased sales revenues during thesecond quarter of 2000 when compared with the same period of 1999.  The netincome for the second quarter of 2000 reduced the Company's year to date netloss to $19,402 as of June 30, 2000, as compared with a year to date net loss of$34,716 at June 30, 1999.  The year to date net loss for the Company is theresult of lower than expected sales revenues during first quarter 2000, andincreased year to date operating expenses.  
**B.  Financial Condition,Liquidity and Capital Resources
The Corporation's current asset to current liabilities ratioat June 30, 2000 was 13:1 compared to 34.2:1 at December 31, 1999. 

The decrease in current ratio is due to increases inrefundable customer deposits and accounts payable amounts when compared withDecember 31, 1999 amounts.

For the quarter ending June 30, 2000, the Company had cashand cash equivalent short-term investment holdings of $1,573,510 as compared tocash and cash equivalent holdings of $1,624,728 at December 31, 1999.  Thedecrease is attributable to increased inventory levels, capital assets, and theCompany's net loss when compared with December 31, 1999. 

Accounts receivable decreased to $148,065 as of June 30,2000, from December 31, 1999 levels of $154,788.  Management believes all of theCompany's accounts receivable as of June 30, 2000 are collectible.  Inventoryincreased to $499,202 at June 30, 2000, from December 31, 1999 levels of$357,490, due to increased procurement for production of products primarily forMobile Data Computer projects.  Provision for Federal Income Taxes increased to$15,996 at June 30, 2000 as the provision for potential tax credit for theCompany increased for the period ended June 30, 2000, as this provision wascalculated from the Company's year to date net loss as of June 30, 2000. 

The Company's fixed assets, net of depreciation, increased to$175,372 as of June 30, 2000, increased from December 31, 1999 levels of$145,123, due to capital expenditures of $49,023.  The expenditures were forsoftware development tools for the new ESTeem 192E Ethernet product andadditional equipment used in the manufacturing of the Company's products.Management foresees additional capital expenditures may be necessary in 2000 tosupport the production and sale of the Company's products.

As of June 30, 2000, the Company's trade accounts payablebalance was $50,940 as compared with $36,607 at December 31, 1999, and reflectsamounts owed for purchases of inventory items and contracted services.Refundable deposit liability was $100,450 for the quarter ended June 30, 2000,and reflects prepaid amounts for Mobile Data Computer customers under contractprior to delivery of material by the Company.

In Management's opinion, the Company's cash and cashequivalent reserves, and working capital at June 30, 2000 is sufficient tosatisfy requirements for operations, capital expenditures, and otherexpenditures as may arise during 2000
***FORWARD LOOKING STATEMENTS:  The above discussion maycontain forward looking statements that involve a number of risks anduncertainties.  In addition to the factors discussed above, among other factorsthat could cause actual results to differ materially are the following:competitive factors such as rival wireless architectures and price pressures;availability of third party component products at reasonable prices; inventoryrisks due to shifts in market demand and/or price erosion of purchasedcomponents; change in product mix, and risk factors that are listed in theCompany's reports and registration statements filed with the Securities andExchange Commission.***PART II

OTHER INFORMATION 

Item 4. Submission ofMatters to the Securities Holders 

At the Company's Annual StockholderMeeting on June 2, 2000, in Kennewick, Washington the following items were votedon by the stockholders with the following outcomes: 

   	Item #1 Election of Directors:

	Melvin H. Brown 

Votes for: 3,880,776
Abstaining: 14,836
	Arthur Leighton 

Votes for: 3,882,078
Abstaining: 13,534
Robert Southworth 

Votes for: 3,784,384
Abstaining: 110,728
	

Item #2 Ratification of Robert Moe & Associates, P.S. asindependent auditors of the Corporation for the fiscal year ending December 31,2000.

Votes for: 3,878,290	
Votes against: 2,857
Abstaining: 14,950
Item #3 Authorization of proxy to vote upon other matters asmay properly come before the meeting. (No such issues were brought before themeeting) 

Votes for: 3,774,618	
Votes against: 98,667
Abstaining: 22,812 
	 

Item 6.  EXHIBITS ANDREPORTS ON FORM 8-K

(a) Exhibits 

Exhibit 27. Financial Data Schedule, June 30, 2000

 	(b) Reports on Form 8-K 

Form 8-K dated February 11, 2000 is incorporated herein by reference.

Exhibit Index
Reference Form 10-QSB 
Exhibit Number	
Notes to Financial Statements 
4.  Instruments defining the Rights of Security Holdersincluding indentures. 

Form 8-K dated Feb 11, 2000 is incorporated herein byreference.  

	 

11. Statement Re: computation of per shareearnings	
Note 3 to Financial Statements 
			 

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrantcaused this report to be signed on its behalf by the undersigned, thereunto dulyauthorized. 
 
ELECTRONIC SYSTEMS TECHNOLOGY, INC.
 

 

Date:	July 27, 2000
/s/ T.L KIRCHNER 
Name:  T.L. Kirchner 
Title: Director/President 
(Principal Executive Officer)
Date:	July 27, 2000
/s/ ROBERT SOUTHWORTH 
Name:  Robert Southworth 
Title: Director/Secretary/Treasurer 
(Principal Financial Officer)
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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