UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON D.C. 20549FORM 10-QSB

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

| For the quarterly period ended:
September 30 2002
Commission File Number:
000-27793
 
**ELECTRONIC SYSTEMS TECHNOLOGY, INC.(A Washington Corporation)****
I.R.S. Employer    Identification no.
91-1238077
 

415 N. Quay St., #4Kennewick WA 99336
Registrant’s telephone number, including area code:(509) 735-9092
 

 

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

 

The number of shares outstanding of common stock as of September 30,2002 was 5,098,667.

 

 
**PART I - FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS.

ELECTRONIC SYSTEMS TECHNOLOGY, INC.(as prepared by Management)(Unaudited)****
SELECTED FINANCIAL DATA
Nine Months Ended
September 30, 2002
September 30, 2001Sales
$ 1,384,892
$ 927,970Other Revenues
120,150
163,847Gross Profit
763,367
436,732 Income (Loss) Before Taxes 
232,222
1,244Net Income (Loss) After Taxes
154,841
1,026 Earnings (Loss) Per Share Before    TaxesBasic
$ 0.04
$ 0.00Diluted
0.04
0.00 Earnings (Loss) Per Share After    TaxesBasic
$ 0.03
$ 0.00Diluted
0.03
0.00 Weighted Average Shares    Outstanding Primary
5,624,352
5,642,914Diluted
5,633,667
5,613,667 Total Assets
$ 2,670,310
$ 2,425,185 Long-Term Debt and Capital Lease Obligations
$ 0
$ 0 Shareholders' Equity
$ 2,464,991
$ 2,321,472 Shareholders' Equity Per Share
$ 0.48
$ 0.46 Working Capital
$ 1,055,927
$ 2,129,650 Current Ratio
6:1
21.5:1 Equity To Total Assets
92%
96%
 
**ELECTRONIC SYSTEMS TECHNOLOGY, INC.BALANCE SHEET(as prepared by Management)(Unaudited)****
September 30,    2002
Dec. 31 ,2001ASSETSCURRENT ASSETS Cash and cash equivalents
$ 494,765
$ 1,513,592 Accounts Receivable, net of allowance for    uncollectibles
137,115
158,674 Inventory
600,774
531,599 Accrued Interest
652
1,243 Prepaid Expenses
27,940
7,252Provision for Federal Income Taxes
0
6,633Total Current Assets
$ 1,261,246
$ 2,218,993 PROPERTY & EQUIPMENT net of    Depreciation of $387,985 at    September 30, 2002 and $359,018    At Dec. 31, 2001
155,874
164,989 OTHER ASSETSMarketable Securities Investments
1,215,681
0Other Assets
37,509
17,690TOTAL ASSETS
$ 2,670,310
$ 2,401,672 LIABILITIES & STOCKHOLDERS'    EQUITY CURRENT LIABILITIESAccounts Payable
$ 52,969
$ 53,384Refundable Deposits
40,752
0Deferred Tax Liability 
17,283
17,283Federal Income Taxes Payable
70,748
0Accrued Liabilities
23,567
20,855Total Current Liabilities 
205,319
91,522 STOCKHOLDERS' EQUITY    Common Stock, $.001 Par Value    50,000,000 Shares Authorized    5,098,667 Shares Issued And Outstanding 
$ 5,099
$ 5,099 Additional Paid-in Capital
945,734
945,734 Retained Earnings
1,514,158
1,359,317
$ 2,464,991
$ 2,310,150 TOTAL LIABILITIES AND    STOCKHOLDERS' EQUITY
$ 2,670,310
$ 2,401,672 
(See "Notes to Financial Statements")

 
**ELECTRONIC SYSTEMS TECHNOLOGY, INC.STATEMENT OF OPERATIONS(as prepared by Management)(Unaudited)**** 
Three Months    Ended
Nine Months    Ended
September 30,    2002
September 30,    2001
September 30, 2002
September 30, 2001SALES
$385,191
$506,242
$ 1,384,892
$ 927,970COST OF SALESBeginning Inventory
$ 576,602
$ 641,778
$ 531,599
$ 561,946Purchases and Allocated Costs
208,971
171,378
690,700
493,322 
$ 785,573
$ 813,156
$ 1,222,299
$ 1,055,268Ending Inventory
600,774
564,030
600,774
564,030Total Cost of Sales
$ 184,799
$ 249,126
$ 621,525
$ 491,238Gross Profit
$ 200,392
$ 257,116
$ 763,367
$ 436,732 OPERATING EXPENSESFinance/Administration
$ 35,248
$ 33,160
$ 139,436
$ 118,872Research & Development
37,925
21,536
122,211
104,786Marketing
97,980
71,193
237,013
197,062Customer Service
$ 21,313
$ 23,613
$ 67,410
$ 79,782Total Operating Expense
$ 192,466
$ 149,502
$ 566,070
$ 500,502OPERATING INCOME (LOSS)
$ 7,926
$ 107,614
$ 197,297
$ (63,770)  Other Income (expenses)Interest/Investment Income
$ 9,676
$ 12,068
$ 23,369
$ 45,338Uncollectible Amounts Recovered
287
--
287
--Loss on Asset Disposal
--
--
--
( 1,059)Engineering Services
23,822
43,769
96,494
118,509Engineering Support
(21,157)
(39,855)
(85,225)
(97,775)Other Income (expense)
$ 12,628
$ 15,982
$ 34,925
$ 65,014 INCOME (LOSS) BEFORE TAX
$ 20,554
$ 123,596
$ 232,222
$ 1,244Provision For Income Tax
(6,988)
(42,022)
( 77,381)
( 218) NET INCOME (LOSS)
$ 13,566
$ 81,574
$ 154,841
$ 1,026 Basic Earnings (Loss) Per Share    Before Tax
$ 0.004
$ 0.02
$ 0.04
$ 0.00Basic Earnings (Loss) Per Share    After Tax
$ 0.002
$ 0.014
 

$ 0.03
 

$ 0.00 Diluted Earnings (Loss) Per Share    Before Tax
$ 0.004
$ 0.02
$ 0.04
$ 0.00Diluted Earnings (Loss) Per Share    After Tax
$ 0.002
$ 0.014
$ 0.03
$ 0.00
(See "Notes to Financial Statements") 
** 

ELECTRONIC SYSTEMS TECHNOLOGY, INC.STATEMENT OF CASH FLOWS(as prepared by Management)(Unaudited)****Nine Months Ended
September 30, 2002
September 30, 2001 CASH FLOWS PROVIDED (USED) IN    OPERATING ACTIVITIES:Net Income (Loss)
$154,841
$1,026Noncash items included in income:Depreciation
28,965
31,132Loss on Disposition of Assets
--
1,059Amortization
3,304
1,246Provision for Federal Income Taxes
6,633
218 DECREASE (INCREASE) IN CURRENT    ASSETS:Accounts Receivable Net
21,559
(16,339)Inventory
(69,175)
(2,084)Prepaid Expenses
(20,688)
(7,085)Accrued Interest
591
6,358 INCREASE (DECREASE) IN    CURRENT LIABILITIES:Accounts Payable and Accrued Expenses 
$ 2,298
$ ( 6,578)Refundable Deposits
40,752
10,566Accrued Federal Income Taxes
70,748
--
$ 239,828
$ 19,519 CASH FLOWS PROVIDED (USED) IN    INVESTING ACTIVITIES:Marketable Securities Investment
$(1,215,681)
--Additions To Property And Equipment
(19,852)
$(30,580)Deposits Paid for Property and Equipment
(23,122) Capitalized Software
--
$(11,944)
$ (1,258,655)
$(42,524)CASH FLOWS PROVIDED (USED) IN    FINANCING ACTIVITIES:Common Stock Issued through exercised stock    options
--
30Additional Paid In Capital from exercised    stock options
--
12,270
$ 0
$ 12,300NET INCREASE (DECREASE) IN CASH    AND    CASH EQUIVALENTS
$ (1,018,827)
$ (10,705)Cash And Cash Equivalents At    Beginning Of Period
1,513,592
1,452,287Cash And Cash Equivalents At Ending of Period 
$ 494,765
$1,441,582 SUPPLEMENTAL DISCLOSURES OF CASH    FLOWS INFORMATION:Cash Paid Year To Date:Interest
$ 0
$ 0Federal Income Taxes
$ 0
$ 0 Cash And Cash Equivalents:Cash
$ 11,098
$ 6,100Money Market Accounts
345,676
453,850Certificates Of Deposit
137,991
981,632
$ 494,765
$ 1,441,582
(See "Notes to Financial Statements)

 
**ELECTRONIC SYSTEMS TECHNOLOGY, INC.NOTES TO FINANCIAL STATEMENTS(as prepared by Management)(Unaudited)**NOTE 1 - BASIS OF PRESENTATION**
The financial statementsof Electronic Systems Technology, Inc. (the "Company" ), presented in this Form10Q are unaudited and reflect, in the opinion of Management, a fair presentation ofoperations for the three and nine month periods ended September 30, 2002 and September 30,2001. Certain information and footnote disclosure normally included in financialstatements prepared in accordance with generally accepted accounting principals have beencondensed or omitted pursuant to the applicable rules and regulations of the Securitiesand Exchange Commission. These financial statements should be read in conjunction with theaudited financial statements and notes thereto included in the Company's Form 10K for theyear ended December 31, 2001 as filed with Securities and Exchange Commission.

The results of operation for the three and ninemonth periods ended September 30, 2002 and September 30, 2001, are not necessarilyindicative of the results expected for the full fiscal year or for any other fiscalperiod.**NOTE 2 - INVENTORIES**
Inventories are stated at lower of cost ormarket with cost determined using the FIFO (first in, first out) method. Inventoriesconsist of the following:

September 30    2002
December 31    2001Parts
$331,771
$ 357,884Work in progress
117,863
94,036Finished goods
151,140
79,679
$600,774
$ 531,599**NOTE 3 – EARNINGS (LOSS) PER SHARE**
Basic Earnings Per Share (EPS) excludes dilution and is computed bydividing income available to common stockholders by the weighted-average number of commonshares outstanding for the period. Diluted EPS reflects potential dilution occurring ifsecurities or other contracts to issue common stock were exercised or converted intocommon stock or resulted in the issuance of common stock that then shared in the earningsof the Company. The primary weighted average number of common shares outstanding was5,624,352 and 5,642,914 for the quarters ended September 30, 2002 and 2001 respectively.

For the Quarter Ended    September 30, 2002 
Income(Numerator)
Shares(Denominator)
Per-ShareAmount
Basic EPS

Income available to common stockholders
$13,566
5,624,352
$0.002
Diluted EPS

Income available to common stockholders+assumed conversions
$13,566
5,633,667
$0.002**NOTE 4 - STOCK OPTIONS**
As of September 30, 2002, the Company had outstanding stock options that have beengranted periodically to individual employees and directors with no less than three yearsof continuous tenure with Company. On February 15, 2002, additional stock options topurchase shares of the Company's common stock were granted to individual employees anddirectors with no less than three years continuous tenure. The options granted on February15, 2002 totaled 180,000 shares under option and have an exercise price of $0.42 pershare. The options granted on February 15, 2002 may be exercised any time during theperiod from February 15, 2002 through February 14, 2005. The Company's Form 8-K datedFebruary 15, 2002, as filed with the Securities and Exchange Commission is included hereinby reference. All outstanding stock options must be exercised within 90 days aftertermination of employment. During the 12-month period from September 30, 2001 to September30, 2002, 160,000 shares under option expired, no shares under option were exercised, and180,000 shares under option were granted. At September 30, 2002 there were 535,000 sharesunder option reserved for future exercises.

The Company has adopted the disclosure-only provisions of Statement ofFinancial Accounting Standards (SFAS) No. 123, "Accounting for Stock-BasedCompensation." The Company undertakes to make disclosures and calculations pursuantto SFAS 123 on an annual basis coinciding with the issuance of the Company's AnnualFinancial Statements. Accordingly, no compensation cost has been recognized for the stockoption plan. 
**NOTE 5 - RELATED PARTY TRANSACTIONS**
For the nine-month period ended September 30, 2002 services in the amount of $95,071were contracted with Manufacturing Services, Inc., of which the owner/president is amember of the Board of Directors of the Company. 

 
**ITEM II

MANGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND RESULTS OF OPERATION***Management’s discussion and analysis is intended to be read in conjunction withthe company’s unaudited financial statements and the integral notes thereto for thequarter ending September 30, 2002. The following statements may be forward looking innature and actual results may differ materially.***A. RESULTS OF OPERATIONS

REVENUES:**
Total revenues from the sale of the Company’s ESTeem(TM) wireless modem systems, accessories, and services decreased to$409,013 for the third quarter of 2002 as compared to $550,011 in the third quarter of2001, reflecting a decrease of 26%. Gross revenues decreased to $418,976 for the quarterending September 30, 2002, from $562,079 for the third quarter of 2001. The sales revenuedecrease is due to decreased product sales in domestic and foreign industrial automationmarket sectors, when compared with a relatively strong sales volume quarter of 2001.Year-to-date revenues for the Company remain strong when compared with the same period of2001. As of September 30, 2002, revenues from the sale of the Company’s products andservices increased to $1,481,386 for the first nine months of 2002, as compared to$1,046,479 for the same period of 2001. The increase in revenues, year-to-date, is theresult of increased sales volumes for domestic and foreign Industrial Automationapplications, which Management believes may continue in the near term, but cannot beassured in terms of duration due to uncertain economic and market conditions thatcurrently exist. 

The Company's revenues have historically fluctuated from quarter toquarter due to timing factors such as customer order placement and product shipments tocustomers, as well as customer buying trends, and changes in the general economicenvironment. The procurement process regarding plant and project automation, or projectdevelopment, which usually surrounds the decision to purchase ESTeem products can belengthy. This procurement process may involve bid activities unrelated to the ESTeemproducts, such as additional systems and subcontract work, as well as capital budgetconsiderations on the part of the customer. Because of the complexity of this procurementprocess, forecasts in regard to the Company's revenues become difficult to predict.

The Company's revenues fall into three major customer categories, Domestic, Export andU.S. Government Sales. Domestic commercial sales decreased to $335,520 in the thirdquarter of 2002 as compared to $415,754 for the third quarter of 2001. Foreign exportsales for the third quarter of 2002 decreased to $73,493 as compared to the $117,328 inthe same quarter of 2001, due to timing differences of sales to South Korea and comparisonwith a strong export sales quarter for 2001.

U.S. Government sales decreased to $0 in the third quarter of 2002, from third quarter2001 levels of $16,929. Management believes the decrease in U.S. Government sales reflectsa continuation of an overall reduction in U.S. Government sales revenue experienced duringthe prior three years, when compared with past historical levels. Management believes thetrend is toward decreasing U.S. Government sales as a result of a continued downward salestrend for projects and purchases in the U.S. Government sales marketplace. Managementbelieves this may continue for the foreseeable future. Due to the uncertain nature of U.S.Government purchasing, Management does not base profitability or liquidity projections onexpected U.S. Government sales.

During the quarter ended September 30, 2002, material and services provided toConsolidated Electrical Distributors (CED), a national distributor of the Company’sproducts, accounted for 17% of the Company’s sales and service revenues. No othersales to a single customer comprised 10% or more of the Company’s product and servicesales for the quarter ending September 30, 2002. 

A percentage breakdown of EST’s major customer categories of Domestic, Export andU.S. Government Sales, for the third quarter of 2002 and 2001 are as follows:

For the third quarter of 
2002
2001
Domestic Sales
82%
76%
Export Sales
18%
21%
U.S. Government Sales
--
3%
A percentage breakdown of EST's product sales categories for the third quarter of 2002and 2001 are as follows:

For the Quarter Ended    September 30 
2002
2001
ESTeem Model 192
71%
70%
ESTeem Model 95
1%
3%
ESTeem Model 96
1%
1%
ESTeem Accessories
19%
17%
Factory Services
2%
1%
Site Support
6%
8%
Sales for the third quarter of 2002 and 2001 include foreign export sales as follows:

Three Months Ended
September 30, 2002
September 30, 2001
Export sales
$ 73,493
$ 117,328
Percent of sales
18%
21%
The geographic distribution of foreign sales for the third quarter of 2002 and 2001 isas follows:

Percent of Foreign Sales
COUNTRY
September 30, 2002
September 30, 2001Croatia
40%
--Canada
29%
25%Jordan
15%
20%Australia
10%
--Peru
3%
--Indonesia
2%
--Ireland
1%
--South Korea
--
28%Japan
--
12%Brazil
--
11%Puerto Rico
--
4%Mexico
--
NilAustria 
--
NilChile
--
Nil
The majority of the Company's domestic and foreign sales for the thirdquarter of 2002 were used in Industrial Automation applications. Industrial Automationapplications have historically been the majority of the Company’s domestic sales,which Management believes will continue for the foreseeable future, but will also be,augmented by sales of Mobile Data Computer Systems for public safety entities. During thefirst 9 months of 2002, Mobile Data Computer Systems (MDCS) sales levels were lower thananticipated, a trend experienced by the Company during the previous 24 months, whichManagement believes may continue due to current market conditions and public safety entitypurchases being linked to uncertain government funding. 
**BACKLOG:**
The Company had a backlog of $177,000 at September 30, 2002, the majority of which isfor a large customer order placed late in September with an expected shipment in thefourth quarter of 2002. Customers generally place orders on an "as neededbasis". Shipment is generally made within 5 to 10 working days after receipt of anorder from a customer, with the exception of ongoing, scheduled projects, and customdesigned equipment for specific customer applications.
**COST OF SALES:**
Cost of sales percentages of gross sales for the third quarters of 2002and 2001 were 48% and 49% of gross sales respectively. The Cost of Sales reduction for thesecond quarter of 2002 is attributable to the type of product sold, as well differences indiscounted pricing structures for those products sold, positively effecting profitmargins, when compared with the same quarter of 2001.
**OPERATING EXPENSES:**
Operating expenses for the third quarter of 2002 increased $42,964 when compared withthe third quarter of 2001. The following is a delineation of operating expenses:

For the quarter ended:
September 30,2002
September 30,2001
Increase (Decrease)
Finance/Administration
$ 35,248
$ 33,160
$ 2,088
Research/Development
37,925
21,536
16,389
Marketing
97,980
71,193
26,787
Customer Service
21,313
23,613
(2,300)
Total Operating Expenses
$ 192,466
$ 149,502
$ 42,964**FINANCE AND ADMINISTRATION:**
During the third quarter of 2002 Finance and Administration expenses increased $2,088when compared with the third quarter of 2001. The increase is the result of increaseddepartment salaries and related payroll taxes as well as higher department relatedprinting expenses when compared with the third quarter of 2001. 
**RESEARCH AND DEVELOPMENT:**
During the third quarter of 2002, Research and Development expenses increased $16,389when compared with the third quarter of 2001. Research and Development expenditures forthe third quarter of 2002 increased as a result of increased department salaries andsubcontracted engineering expertise contracted by the Company during the quarter, whencompared with the same quarter of 2001 (during which a portion of salaries werecapitalized as a software asset for development of the ESTeem 192E Ethernet operatingsystem).
**MARKETING:**
Marketing expenses increased $26,787 during the third quarter of 2002from the same period in 2001, due to increased department salaries, related payroll taxesand travel expenditures resulting from the Company hiring an additional Sales Manager,when compared with the same period of 2001. 
**CUSTOMER SERVICE:**
Customer service expenses for the third quarter of 2002 decreased$2,300 when compared with the third quarter of 2001. The decrease is attributable to anincreased amount of costs being billed directly to customers, and reduced departmentrelated travel expenses during the third quarter of 2002 when compared with the samequarter of 2001.
**INTEREST AND INVESTMENT INCOME:**
The Company earned $9,963 in investment income for the quarter ended September 30,2002. Sources of income were short-term investments, marketable securities investments,savings and money market accounts.
**ENGINEERING SUPPORT:**
Engineering support costs decreased to $21,157 for the quarter endedSeptember 30, 2002, as compared to $39,855 for the same period of 2001. The decrease inengineering support costs for the third quarter of 2002 is a direct result of decreasedengineering services revenues performed by the Company for customers, when compared withthe third quarter of 2001. 
**NET INCOME (LOSS):**
The Company recorded a net income of $13,566 for the third quarter of 2002, compared toa net income of $81,574 for the third quarter of 2001. The decrease is attributable todecreased sales revenues combined with increased operating costs during the third quarterof 2002, as compared with the third quarter of 2001. Year to date, the Company has NetIncome of $154,841 for the nine months ended September 30, 2002, compared with $1,026 forthe same period of 2001. The increased Net Income levels are the result of increasedproduct sales revenues experienced during the first two quarters of 2002 effecting year todate profitability when compared with the same period of 2001. 
**B. Financial Condition, Liquidity and Capital Resources**
The Corporation's current asset to current liabilities ratio atSeptember 30, 2002 was 6:1 compared to 24.7:1 at December 31, 2001. The decrease incurrent ratio is due to increased Federal income tax payable and refundable depositamounts, as well as Marketable Securities investments being classified as non-currentassets at September 30, 2002, when compared with December 31, 2001 amounts.

For the quarter ending September 30, 2002, the Company had cash andcash equivalent short-term investment holdings of $494,765 as compared to cash and cashequivalent holdings of $1,513,592 at December 31, 2001. The decrease is attributable toinvestments made by the Company in marketable securities investments, as well as increasesin inventory levels, capital asset expenditures and deposits paid for capital assets withfuture delivery dates. 

Accounts receivable decreased to $137,115 as of September 30, 2002,from December 31, 2001 levels of $158,674. Inventory increased to $600,774 at September30, 2002, from December 31, 2001 levels of $531,599, due to increased procurement forproducts entering production. The Company's fixed assets, net of depreciation, decreasedto $155,874 as of September 30, 2002, from December 31, 2001 levels of $164,989.Year-to-date capital expenditures of $19,852 were for purchase of manufacturing, researchand development equipment and upgrades to the Company’s computer network. Managementforesees additional capital expenditures may be necessary to support the production andsale of the Company’s products. The Other Asset category increased to $37,509 as theresult of deposits for assets yet to be delivered in the amount of $23,122 were paid as ofSeptember 30, 2002. Provision for Federal Income Taxes decreased to $0 at September 30,2002 as the potential tax credit for the Company at December 31, 2001 decreased, anddeveloped into a Federal Income tax payable liability of $70,748, as calculated from theCompany’s year-to-date net income as of September 30, 2002.

As of September 30, 2002, the Company’s trade accounts payablebalance was $52,969 as compared with $53,384 at December 31, 2001, and reflects amountsowed for purchases of inventory items and contracted services. Refundable depositliability was $40,752 for the quarter ended September 30, 2002, and reflects prepaidamounts for ongoing MDCS projects.

It is Management’s opinion the Company’s cash, cash equivalent reserves, andworking capital at September 30, 2002 are sufficient to satisfy requirements foroperations, capital expenditures, and other expenditures as may arise in the short term. 
***FORWARD LOOKING STATEMENTS: The above discussionmay contain forward looking statements that involve a number of risks and uncertainties.In addition to the factors discussed above, among other factors that could cause actualresults to differ materially are the following: competitive factors such as rival wirelessarchitectures and price pressures; availability of third party component products atreasonable prices; inventory risks due to shifts in market demand and/or price erosion ofpurchased components; change in product mix, and risk factors that are listed in theCompany’s reports and registration statements filed with the Securities and ExchangeCommission.
 

 

ITEM III

CONTROLS & PROCEDURES
Evaluation of Disclosure Controls and Procedures.
The    Company’s Chief Executive and its Chief Financial Officer, after evaluating the    effectiveness of the Company’s disclosure controls and procedures (as defined in the    Securities Exchange Act of 1934 Rules 13a-14(c) and 15d- 14(c) as of a date within 90 days    of the filing date of this quarterly report on Form 10-QSB (the "Evaluation    Date"), have concluded that as of the Evaluation Date, the Company’s disclosure    controls and procedures were adequate and effective to ensure that material information    relating to the Company would be made known to it by others within the Company,    particularly during the period in which this quarterly report on Form 10-QSB was being    prepared.
 
**Changes in Internal Controls.
 There were not significant changes in the    Company’s internal controls or in other factors that could significantly affect the    Company’s disclosure controls and procedures subsequent to the Evaluation Date, nor    any significant deficiencies or material weaknesses in such disclosure controls and    procedures requiring corrective actions.

 
** 

 

 

 

 

 

 

PART II

OTHER INFORMATION**
 
**Item 6. EXHIBITS AND REPORTS ON FORM 8-K(b)Reports on Form 8-K
 

Form 8-K dated February 15, 2002 is incorporated herein by reference.

 
Exhibit NumberNotes to Financial Statements**4.****Instruments defining the    Rights of Security Holders including indentures.**
 

Form 8-K dated February 15, 2002 is incorporated herein by reference. 
**11.****Statement Re: computation of    per share earnings.**
Note 3 to Financial Statements

 
**Exhibit 99**Exhibit 99.1 – Certification of CEO
Exhibit    99.2 – Certification of CFO
 

 

 
**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: November 7, 2002/s/ TOM L KIRCHNER Name: T.L. KirchnerTitle: Director/President(Principal Executive Officer)
 
Date: November 7, 2002/s/ JON CORREIO  Name: Jon CorreioTitle: Vice President, Finance &    Administration(Principal Financial Officer)
 

 

 

 

 

 

 

 

 

 

 

 

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