UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: February 6, 1998
ELECTRONIC SYSTEMS TECHNOLOGY INC.
(A Washington Corporation)
Commission File no. 2-92949-S
IRS Employer Identification no. 91-1238077
415 N. Quay St. #4
Kennewick WA 99336
(Address of principal executive offices)
Registrant's telephone number, including area code:(509) 735-9092
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ITEM 5. OTHER EVENTS
During the Company's scheduled Board of Directors Meeting on
February 6, 1998, the Board of Directors awarded stock options for
Employees and Directors, as recommended by the Board's Employee/Director
Stock Option Committee, subject to the conditions delineated in the
Committee's recommendations and in accordance with the Electronic
Systems Technology, Inc. Stock Option Plan for Directors, Officers, and
Employees, as approved by Shareholder vote on June 7, 1996. Employees
and Directors who were recipients of the stock options and conditions
relating to the stock options approved by the Board of Directors, are
delineated on attached Exhibit 20.1.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL STATEMENTS, AND EXHIBITS.
Exhibit 20.1 - Summary of Employee/Director Stock Option Committee
recommendations regarding Employee and Director Stock Options, as
approved by the Company's Board of Directors, February 6, 1998.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
ELECTRONIC SYSTEMS TECHNOLOGY, INC.
/s/ T. L. KIRCHNER
By: T.L. Kirchner
President
Date: February 10, 1998
EXHIBIT 20.1 - SUMMARY OF EMPLOYEE/DIRECTOR STOCK OPTION COMMITTEE
RECOMMENDATIONS REGARDING EMPLOYEE AND DIRECTOR STOCK OPTIONS, AS
APPROVED BY THE COMPANY'S BOARD OF DIRECTORS, FEBRUARY 6, 1998.
February 6, 1998
To: EST Board of Directors
From: Employee/Director Stock Option Committee
Subject: Recommendations
The committee recommends to the Board of Directors that the individual
employees and directors with no less than three years continuous tenure
named herein be granted stock options, effective February 6, 1998, in
the amounts tabulated and subject to the conditions herein delineated
and in accordance with the Electronic systems Technology Stock Option
Plan for Directors, Officers, and Employees, as ratified by shareholder
vote on June 7, 1996.
Name Status Option Shares
David B. Strecker Employee 15,000
Eric P. Marske Employee 15,000
Jon A. Correio Employee 15,000
Alan B. Cook Employee 15,000
Debra R. Vaughn Employee 5,000
Melvin Brown Director 25,000
Tom Kirchner Director 25,000
Arthur Leighton Director 25,000
John H. Rector Director 25,000
John L. Schooley Director 25,000
Robert Southworth Director 25,000
Recommended Option Conditions:
1. Each option grant will be at an exercise price per share equal to
market price at the time of grant. Market price will be the mean
of bid and ask prices recorded on the National Daily Quotation
Service "pink sheet" for the effective date of the option grant.
If no activity is reported for that date the "pink sheet" with
closest preceding date with recorded activity will establish
market price.
2. Each grant must be exercised by the optionee not later than three
years (1095) days from the date of the grant.
3. Options will be exercised in minimum blocks of 5,000 shares at any
one time. Options not exercised within the three year (1095 day)
period from option grant will terminate and not carry over.
4. Rule 144 of the Securities Act of 1933 as amended will apply to
all stock acquired by exercise of the option grants. Rule 144
prohibits resale for a period of two years after acquisition and
restricts resale quantities for one additional year. Each
optionee shall make an independent inquiry as to all other
restrictions.
5. The company shall have the right, but not obligation, to register
all or any portion of the optioned shares at any time. The intent
of registration is to relieve the Rule 144 resale restrictions
which may still be in force at the time of registration.
6. In the event of termination of employment or board membership, the
optionee shall have a period of ninety days in which to exercise
any options which he has been granted, except under the conditions
of paragraph 7 and 8, which shall supersede the provisions of this
paragraph. Unless otherwise extended by the board, all options
terminated at the end of the ninety day period.
7. If recapitalization and/or similar events result in the change of
share unit values, the optionee will receive equivalent shares.
If the company is not the surviving entity by virtue of merger,
acquisition, etc., the optionee will have a window of ten days in
which to exercise his option. The last day of the window will be
five days prior to the legal conclusion of any such event.
8. In the event of company acquisition, merger, reorganization and
other transactions altering the company structure any outstanding
options then in force must be immediately exercised.
9. Option grants are not transferable or assignable except to an
employee's estate in accordance with the laws of inheritance in
the event of optionee's death.
10. All facets of the stock option program shall be appropriately
documented in accordance with the advice of the company's legal
counsels and shall comply with all relevant legal requirements in
the State of Washington and all Securities and Exchange Commission
rules, regulations, and disclosure requirements.
