<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549

                                   FORM 10-QSB

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

                      FOR THE QUARTER ENDED MARCH 31, 1999

                         COMMISSION FILE NUMBER 0-22081
               --------------------------------------------------


                           ELECTRONIC PROCESSING, INC.


         MISSOURI                                  48-1056429
(State or Other Jurisdiction of        (IRS Employer Identification Number)
Incorporation or Organization)

                501 KANSAS AVENUE, KANSAS CITY, KANSAS 66105-1300
                     (Address of Principal Executive Office)

                                  913-321-6392
                           (Issuer's Telephone Number)


Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
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 registrants common stock at April 30, 1999,
was 4,635,068 shares.

Transitional Small Business Disclosure Format (Check one):    Yes    No  X
                                                                 ---    ---

<PAGE>

                           ELECTRONIC PROCESSING, INC.
                                   FORM 10-QSB
                          QUARTER ENDED MARCH 31, 1999

                                    CONTENTS

<TABLE>
<CAPTION>

                                                                                     Page 
                                                                                     ----
<S>                                                                                 <C>
PART 1 - FINANCIAL INFORMATION

Item 1. Financial Statements

     Statements of Income -
         Three months ended March 31, 1999 and 1998                                     3

     Balance Sheets - December 31, 1998 and March 31, 1999                              4

     Statements of Cash Flows -
         Three months ended March 31, 1999 and 1998                                     6

     Notes to Financial Statements - March 31, 1999 and 1998                            7

Item 2. Management's Discussion and Analysis of Financial Condition and                 8
     Results of Operations


PART II - OTHER INFORMATION

Item 1. Legal Proceedings                                                              10

Item 2.  Changes in Securities                                                         10

Item 3. Defaults Upon Senior Securities                                                10

Item 4. Submission of Matters to a Vote of Security Holders                            10

Item 5. Other Information                                                              10

Item 6. Exhibits and Reports on Form 8-K                                               10

Signatures                                                                             11

</TABLE>

<PAGE>

                             ELECTRONIC PROCESSING, INC.
                                 STATEMENTS OF INCOME
                  FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
                                     (UNAUDITED)

<TABLE>
<CAPTION>

                                                           1999                  1998
                                                    -----------           -----------
<S>                                                <C>                   <C>
OPERATING REVENUES                                  $ 3,429,910           $ 2,535,796
                                                    -----------           -----------
COST OF GOODS SOLD AND DIRECT COSTS
         Processing costs                             1,140,139               891,835
         Depreciation and amortization                  463,460               285,419
                                                    -----------           -----------
                                                      1,603,599             1,177,254
                                                    -----------           -----------
GROSS PROFIT                                          1,826,311             1,358,542
                                                    -----------           -----------
OPERATING EXPENSES
         General and administrative                   1,250,201               884,036
         Depreciation and amortization                   35,065                39,736
                                                    -----------           -----------
                                                      1,285,266               923,772
                                                    -----------           -----------
INCOME FROM OPERATIONS                                  541,045               434,770
                                                    -----------           -----------
OTHER INCOME (EXPENSE)
         Interest income                                135,332                21,105
         Interest expense                                (7,051)              (37,653)
         Other                                               71                   325
                                                    -----------           -----------
                                                        128,352               (16,223)
                                                    -----------           -----------
NET INCOME BEFORE INCOME TAXES                          669,397               418,547
PROVISION FOR INCOME TAXES
               Current                                  224,886               147,629
               Deferred                                  32,919                20,371
                                                    -----------           -----------
                                                        257,805               168,000
                                                    -----------           -----------
NET INCOME PER SHARE                                $   411,592           $   250,547
                                                    -----------           -----------
                                                    -----------           -----------
               Basic                                $       .09           $       .07
                                                    -----------           -----------
                                                    -----------           -----------
               Diluted                              $       .09           $       .07
                                                    -----------           -----------
                                                    -----------           -----------
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
             Basic                                    4,634,117             3,409,218
                                                    -----------           -----------
                                                    -----------           -----------
             Diluted                                  4,784,840             3,592,205
                                                    -----------           -----------
                                                    -----------           -----------

</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

                           ELECTRONIC PROCESSING, INC.

                                 BALANCE SHEETS

                      DECEMBER 31, 1998 AND MARCH 31, 1999
                                   (UNAUDITED)

                                     ASSETS

<TABLE>
<CAPTION>

                                                                  December 31, 1998       March 31, 1999
                                                                  -----------------       --------------
<S>                                                              <C>                     <C>
CURRENT ASSETS
         Cash and cash equivalents                                      $   820,256          $   467,656
         Short-term investment                                           10,700,000           10,400,000
         Accounts receivable, trade, less allowance for
           doubtful accounts of $5,000                                    1,586,303            2,375,908
         Prepaid expenses and other                                         294,024              187,828
         Deferred income taxes                                               39,345               39,344
                                                                        -----------          -----------
                           Total Current Assets                          13,439,928           13,470,736
                                                                        -----------          -----------
PROPERTY AND EQUIPMENT, At cost
         Furniture and fixtures                                             526,862              538,920
         Computer equipment                                               7,254,072            7,884,149
         Office equipment                                                   329,775              329,775
         Leasehold improvements                                             864,184              864,184
         Transportation equipment                                            14,969               14,969
                                                                        -----------          -----------
                                                                          8,989,862            9,631,997
         Less accumulated depreciation                                    3,233,510            3,623,943
                                                                        -----------          -----------
                                                                          5,756,352            6,008,054
                                                                        -----------          -----------
SOFTWARE DEVELOPMENT COSTS, Net of
amortization                                                              2,016,946            2,047,787
                                                                        -----------          -----------
INTANGIBLE ASSETS, Net of amortization
         Excess of cost over fair value of net assets acquired               59,473               58,969
                                                                        -----------          -----------
OTHER ASSETS
                                                                              5,912                9,214
                                                                        -----------          -----------

                                                                        $21,278,611          $21,594,760
                                                                        -----------          -----------
                                                                        -----------          -----------

</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

                      LIABILITIES AND STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>

                                                                      December 31, 1998       March 31, 1999
                                                                      -----------------       --------------
<S>                                                                  <C>                     <C>
CURRENT LIABILITIES
         Current maturities of long-term debt                               $   159,151          $   126,601
         Accounts payable                                                       626,577              400,159
         Accrued expenses                                                       450,608              459,584
         Income taxes payable                                                    12,672              129,360
                                                                            -----------          -----------
                           Total Current Liabilities                          1,249,008            1,115,704

LONG-TERM DEBT                                                                  109,300              139,389
                                                                            -----------          -----------
DEFERRED INCOME TAXES                                                           529,485              529,483


STOCKHOLDERS' EQUITY
             Common stock, $.01 par value; authorized 10,000,000
             shares; issued and outstanding 4,633,268 shares
             December 31, 1998 and 4,635,068 shares March 31, 1999               46,333               46,351

                                   Additional paid-in capital                17,660,878           17,668,635
                                   Retained earnings (deficit)                1,683,607            2,095,198
                                                                            -----------          -----------
                                                                             19,390,818           19,810,184
                                                                            -----------          -----------


                                                                            $21,278,611          $21,594,760
                                                                            -----------          -----------
                                                                            -----------          -----------

</TABLE>

<PAGE>

                           ELECTRONIC PROCESSING, INC.
                            STATEMENTS OF CASH FLOWS
               FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                          1999             1998
                                                                                         -----            -----
<S>                                                                                  <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES
         Net income (loss)                                                             411,592          250,547
         Items not requiring (providing) cash:
                  Deferred income taxes                                                      1           20,371
                  Depreciation                                                         390,571          248,415
                  Amortization of software development costs                           107,451           76,237
                  Amortization of intangible assets                                        503              503
         Changes in:
                  Accounts receivable                                                 (789,605)        (223,182)
                  Prepaid expenses and other assets                                    102,894          (29,329)
                  Accounts payable and accrued expenses                               (217,442)        (143,499)
                                                                                                     ----------
                  Income taxes payable                                                 116,688
                                                                                     ---------
                                    Net cash provided by operating activities          122,652          200,063
                                                                                     ---------       ----------
CASH FLOWS FROM INVESTING ACTIVITIES
         Purchase of property and equipment                                           (671,199)         (56,280)
         Expenditures for software development costs                                  (138,293)        (156,706)
         Equipment sold from fixed assets                                               95,852
         Proceeds from sale of investments                                             300,000
                                                                                     ---------       ----------
                                    Net cash used in investing activities             (413,640)        (212,986)
                                                                                     ---------       ----------
CASH FLOWS FROM FINANCING ACTIVITIES
         Principal payments under capital lease obligation                             (65,221)         (96,234)
         Principal payments on long-term debt                                           (4,166)         (81,092)
         Exercise stock options                                                          7,775            6,773
                                                                                     ---------       ----------
                                    Net cash provided by financing activities          (61,612)        (170,553)
                                                                                     ---------       ----------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS                                                                           (352,600)        (183,476)

CASH AND CASH EQUIVALENTS,
BEGINNING PERIOD                                                                       820,256        1,835,233
                                                                                     ---------       ----------
CASH AND CASH EQUIVALENTS,
END OF PERIOD                                                                        $ 467,656       $1,651,757
                                                                                     ---------       ----------
                                                                                     ---------       ----------

</TABLE>

SEE NOTES TO FINANCIAL STATEMENTS

<PAGE>

                           ELECTRONIC PROCESSING, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 1998
                           AND MARCH 31, 1999 AND 1998

NOTE 1:   NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF OPERATIONS

     Electronic Processing, Inc. (the Company) develops, markets, and licenses
proprietary software products and provides support services for Chapter 7 and
Chapter 13 bankruptcy trustees and other users of the federal bankruptcy system.
EPI serves a national client base with specialty products that facilitate the
financial and administrative aspects of bankruptcy management and that are
accompanied by a high level of coordinated support including network
integration, post-installation support and value added services.

USE OF ESTIMATES

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

PROPERTY AND EQUIPMENT

     Property and equipment are depreciated on a straight-line basis over the
estimated useful life of each asset as follows:

<TABLE>
             <S>                                             <C>
              Furniture and fixtures                            10 years
              Computer equipment                                 5 years
              Office equipment                                5-10 years
              Transportation equipment                         3-5 years
</TABLE>

     Leasehold improvements are depreciated over the shorter of the lease term
or the estimated useful lives (5-10 years) of the improvements.

SOFTWARE DEVELOPMENT COSTS

     Certain internal software development costs incurred in the creation of
computer software products are capitalized once technological feasibility has
been established. Prior to the completion of a detail program design,
development costs are expensed. Capitalized costs are amortized based on current
and future revenue for each product with an annual minimum equal to the
straight-line amortization over the remaining estimated economic life of the
product, not to exceed five years.

INTANGIBLE ASSETS

     The excess of cost over fair value of net assets acquired is being
amortized on a straight-line basis over 40 years.

<PAGE>

NOTE 1:  NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
                (CONTINUED)

REVENUE RECOGNITION

     For the Company's Chapter 7 bankruptcy software product, monthly fees are
received from a national financial institution after the product is installed
and deposits are transferred based on the level of trustees' deposits with that
institution. Revenues for Chapter 13 processing and noticing are recorded
monthly at the completion of the services based on the trustees' month-end
caseloads. All ancillary fees are recognized as the services are provided.

INCOME TAXES

     Deferred tax liabilities and assets are recognized for the tax effects of
differences between the financial statement and tax bases of assets and
liabilities. A valuation allowance is established to reduce deferred tax assets
if it is more likely than not that a deferred tax asset will not be realized.


CASH EQUIVALENTS

     The Company considers all liquid investments with original maturities of
three months or less (primarily money market accounts) to be cash equivalents.

INTERIM FINANCIAL STATEMENTS

     The balance sheet as of March 31, 1999 and the statements of income,
shareholders' equity and cash flows for the three month periods ended March 31,
1999 and 1998 have been prepared by the Company without audit. In the opinion of
management, all adjustments (which included only normal, recurring adjustments)
necessary for fair presentation have been made. The results for these periods
are not necessarily indicative of the results to be expected for the full year.


NOTE 2:   ADDITIONAL CASH FLOW INFORMATION

<TABLE>
<CAPTION>

                                                                   Three Months Ended
                                                                        March 31
                                                 December 31,     --------------------
                                                    1998           1999          1998
                                                 -----------      ------        ------
                                                                       (unaudited)
<S>                                             <C>             <C>           <C>
NONCASH INVESTING AND FINANCING
     ACTIVITIES
      Capital lease obligation and notes
      payable incurred for equipment              $ 28,828       $ 66,926      $434,241

ADDITIONAL CASH INFORMATION
      Interest paid                                 97,780          7,051        36,144
      Income taxes paid                            654,438        219,355       110,000

</TABLE>

<PAGE>

ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS
OF OPERATIONS

QUARTER ENDED MARCH 31, 1999 COMPARED TO QUARTER ENDED MARCH 31, 1998

     Operating revenues increased 35.3%, or $894,114 to $3,429,910 in the 
three-month period ended March 31, 1999, compared to $2,535,796 in the 
three-month period ended March 31, 1998. Approximately 99.3% of the growth in 
operating revenues were attributable to revenues generated by Chapter 7. 
Chapter 7 sales increased 74.7%, or $887,660 to $2,076,245 in the 
three-month period ended March 31, 1999, compared to $1,188,585 in the 
three-month period ended March 31, 1998. The increase in Chapter 7 revenue 
was due in part to the growth in new Chapter 7 trustee business for the 
Company resulting in higher monthly fees paid to EPI and the release of 
version 4.0 of TCMS, the Chapter 7 software product. Chapter 13 revenue 
increased 6.6%, or $80,589 to $1,313,385 in the three- month period ended 
March 31, 1999 compared to $1,232,796 in the three-month period ended March 
31, 1998. The sale of additional hardware to existing Chapter 13 trustee 
clients as they converted to CASEPOWER contributed to the increase.

     Total cost of goods sold and direct costs increased 36.2%, or $426,345 
to $1,603,599 in the three-month period ended March 31, 1999, compared to 
$1,177,254 in the three-month period ended March 31, 1998. Total cost of 
goods sold and direct costs as a percentage of operating revenues was 46.8% 
in the three-month period ended March 31, 1999 compared to 46.4% in the 
three-month period ended March 31, 1998. Processing costs increased 27.8%, or 
$248,304, to $1,140,139 in the three-month period ended March 31, 1999, 
compared to $891,835 in the three-month period ended March 31, 1998. The 
increase in 1999 resulted principally from an increase in customer service 
expense to support the growth in Chapter 7 sales and the cost of computer 
hardware for the trustee clients converting to CASEPOWER. Processing costs as 
a percentage of operating revenues decreased to 33.2% in the three-month 
period ended March 31, 1999 compared to 35.2% in the three-month period ended 
March 31, 1998. Depreciation and amortization increased 62.4%, or $178,041, 
to $463,460 in the three-month period ended March 31, 1999, compared to 
$285,419 in the three-month period ended March 31, 1998, primarily due to the 
purchase of computer equipment for the Company's Chapter 7 product.

     Operating expenses increased 39.1%, or $361,494 to $1,285,266 in the 
three-month period ended March 31, 1999, compared to $923,772 in the 
three-month period ended March 31, 1998. Operating expenses as a percentage 
of operating revenues was 37.5% in the three-month period ended March 31, 
1999 compared to 36.4% in the three-month period ended March 31, 1998. The 
increase in operating expenses was due to increases in general and 
administrative infrastructure necessary to support a higher level of 
revenues, including additional sales and marketing expenses related to growth 
of the Company's Chapter 7 product. Sales and marketing expenses include 
sales and marketing salaries, trade show costs, travel associated with 
Chapter 7 installations, and advertising costs. Sales and marketing expenses 
increased 48.1%, or $137,559 to $423,416 in the three-month period ended 
March 31, 1999, compared to $285,857 in the three-month period ended March 
31, 1998.

     Other income (expense) which includes interest income and interest 
expense, was $128,352 in the three-month period ended March 31, 1999 compared 
to ($16,223) in the three-month period ended March 31, 1998. This resulted 
from a reduction in net interest expense due to interest income from the 
investment of the net proceeds from the sale of 

<PAGE>

1,140,500 shares of Common Stock in a secondary public offering completed in 
June of 1998. Outstanding debt was paid off with a portion of the net 
proceeds from the stock offerings resulting in a reduction in interest 
expense.

     The Company's effective tax rates were 38.5% and 40.1% for the 
three-month periods ended March 31, 1999 and March 31, 1998, respectively.

     Net income increased 64.3%, or $161,045, to $411,592 in the three-month 
period ended March 31, 1999, compared to net income of $250,547 in the 
three-month period ended March 31, 1998. Net income as a percentage of 
operating revenues increased to 12.0% in the three-month period ended March 
31, 1999 from 9.9% in the three-month period ended March 31, 1998.

LIQUIDITY AND CAPITAL RESOURCES

     The Company had total cash and short-term investments of $10,867,656 at 
March 31, 1999 and working capital of $12,355,032. In June of 1998, the 
Company sold 1,140,500 shares of Common Stock, which resulted in cash 
proceeds of $12,727,980.

     The Company generated cash from operations of $122,652, and $200,063 for 
the three-months ended March 31,1999, and March 31, 1998, respectively. The 
cash flow from operations in the three-months ended March 31, 1999 consisted 
primarily of net income before deferred taxes of $411,592, depreciation and 
amortization of $498,525, offset by an increase in accounts receivable of 
$789,605 and an decrease in accounts payable and accrued expenses of 
$217,442. The increase in depreciation and amortization relates primarily to 
the purchase of computer equipment for the installations of the Company's 
Chapter 7 product. Accounts receivable increased primarily due to increased 
revenues.

     The cash flow from operations in the three-months ended March 31, 1998 
consisted primarily of net income before deferred taxes of $270,918, 
depreciation and amortization of $325,155, offset primarily by an increase in 
accounts receivable of $223,182, and a decrease in accounts payable and 
accrued expenses of $143,499.

     The Company invested in property and equipment totaling $738,125 and 
$490,521 for the three-month period ended March 31, 1999, and March 31, 1998, 
respectively, which related principally to the installation of computer 
equipment for the Company's Chapter 7 product.

     The Company incurred expenditures for software costs totaling $138,292 
and $156,706 for the three-months ended March 31, 1999, and March 31, 1998, 
respectively. These expenditures are capitalized and are being amortized on a 
straight-line basis over a maximum five-year period. Internal software costs 
incurred in the creation of computer software products are capitalized as 
soon as technological feasibility has been established. Prior to the 
completion of a detailed program design, development costs are expensed. 
Capitalized costs are amortized based on current and future revenue for each 
product with an annual minimum equal to straight-line amortization over the 
remaining estimated economic life of the product, not to exceed five years. 
Additionally, the Company anticipates future software development will be at 
or above the spending levels of prior years.

     The Company believes that the net proceeds from the June 1998 stock 
offering, together with funds that may be generated from operations, will be 
sufficient to finance the Company's currently anticipated working capital and 
property and equipment expenditures for the foreseeable future.

<PAGE>

YEAR 2000

     Many currently installed computer systems and software products are 
coded to accept only two-digit entries to represent years. For example, the 
year "1998" would be represented by "98." These systems and products will 
need to be able to accept four digit entries to distinguish 21st century 
dates from 20th century dates. Any programs that have time sensitive software 
may recognize a date using "00" as the year 1900 rather than the year 2000. 
This could result in the computer shutting down or performing incorrect 
computations. As a result, in less than one year, computer systems and 
software products used by many companies, that do not accept four-digit year 
entries, will need to be upgraded or replaced to comply with such "Year 2000" 
requirements.

     The Company believes that its currently marketed software products are 
Year 2000 compliant. In the first quarter of 1998, the Company began shipping 
release 3.0 of TCMS, as part of the Company's continual process of enhancing 
and upgrading its existing software products. Although release 3.0 of TCMS 
was written to be Year 2000 compliant, the impetus for its design was the 
Company's desire to further streamline Chapter 7 case administration for 
trustees. The Company introduced release 4.0 of TCMS in March, 1999, which 
release was also introduced for market and enhancement purposes unrelated to 
Year 2000 issues, but was written to be Year 2000 compliant. Similarly, in 
1997 the Company began shipping CASEPOWER, a new proprietary 
Windows95/NT-based client-server software application for Chapter 13 
trustees. Like TCMS, CASEPOWER was written to be Year 2000 compliant. Also 
like TCMS, the impetus for CASEPOWER'S design was the Company's commitment to 
the development and marketing of new and competitive bankruptcy case 
management conventions. The Company estimates that its national upgrade 
program for existing Chapter 13 customers, from its older AS/400 legacy 
product to CASEPOWER, is 90% completed. All Chapter 13 trustees are scheduled 
to be upgraded by June 1999.

     The Company is also in the process of discussing with its vendors and 
customers the potential impact the Year 2000 issue may have on their systems. 
More specifically, the Company has reviewed and assessed the probability of a 
material adverse effect from the Year 2000 issue on the Company's exclusive 
national marketing arrangement with Bank of America. Bank of America has 
reported that it undertook a process of software inventory, analysis, 
modification, testing and verification to assess the potential impact of the 
Year 2000 issue on its systems. Bank of America expects to substantially 
complete the Year 2000 software conversion projects for its systems by the 
end of 1999. Bank of America's management believes that its plans for dealing 
with the Year 2000 issue will result in timely and adequate modifications of 
systems and technology. Over the next 9 months, the plans of other third 
parties to address the Year 2000 issue will be monitored and any identified 
impact on the Company will be evaluated.

     The Year 2000 issue also affects the Company's internal systems, 
including information technology (IT) and non-IT systems. The Company has 
assessed the readiness of its systems for handling the Year 2000. Management 
currently believes that all material systems are either compliant, or will be 
upgraded or replaced by the Year 2000. The costs associated with this project 
are being expensed as incurred and are not expected to be material to the 
Company's financial position or results of operations.

     As previously discussed, the Company believes their currently marketed 
software products and internal systems are Year 2000 compliant or will be by 
the end of 1999. Additionally, they are not aware of any vendors or customers 
with Year 2000 problems which could materially impact their operations. 
Accordingly, the Company has not specifically evaluated a worst-case 
scenario, nor has it developed contingency plan of such scenario.

<PAGE>

FORWARD-LOOKING STATEMENTS

     This Form 10-QSB contains forward-looking statements within the meaning 
of Section 27A of the Securities Act of 1933, as amended and Section 21E of 
the Securities Exchange Act of 1934, as amended, including those relating to 
the possible or assumed future results of operations and financial condition 
of the Company. Because those statements are subject to a number of 
uncertainties and risks, actual results may differ materially from those 
expressed or implied by the forward-looking statements. Factors that could 
cause actual results to differ from those expressed or implied include, but 
are not limited to, any material changes in the total asset proceeds on 
deposit by Chapter 7 trustees served by the Company, changes in the number of 
bankruptcy filings each year, the Company's reliance on its marketing 
arrangement for Chapter 7 revenue, the Company's ability to achieve or 
maintain technological advantages, and any material adverse effect of the 
Year 2000 issue and other factors described in the Company's filings with the 
Securities Exchange Commission under the Securities Act of 1933 and the 
Securities Exchange Act of 1934.. The Company undertakes no obligation to 
update any forward-looking statements contained herein to reflect future 
events or developments.






<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None

ITEM 2. CHANGES IN SECURITIES

None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) EXHIBITS

The following Exhibit is filed by attachment to this Form 10-QSB:

<TABLE>
<CAPTION>

Exhibit
Number         Description of Exhibit                    Page
---------------------------------------------------------------
<S>           <C>                                       <C>
  27           Financial Data Schedule                    13

</TABLE>

(b)  REPORTS ON FORM 8-K:

None

<PAGE>

                                   SIGNATURES

     In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.





                                     ELECTRONIC PROCESSING, INC.


Date:    May 15, 1999                   /s/  Tom W. Olofson
                                        -----------------------------------
                                        Tom W. Olofson
                                        Chairman of the Board
                                        Chief Executive Officer
                                        (Principal Executive Officer)
                                        Director

Date:    May 15, 1999                   /s/ Nanci R. Trutna
                                        -----------------------------------
                                        Nanci R. Trutna
                                        Vice President Finance
                                        And Secretary
                                        (Principal Financial Officer)