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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
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Date of report (Date of earliest event reported) March 1, 2010
ELECTRONIC SENSOR TECHNOLOGY, INC.
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(Exact Name of the Registrant as Specified in Charter)
Nevada 000-51859 98-0372780
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(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
1077 Business Center Circle, Newbury Park, California 91320
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(Address of Principal Executive Offices)
Registrant's telephone number, including area code (805) 480-1994
Not Applicable.
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01 Entry into a Material Definitive Agreement.
On March 1, 2010, Electronic Sensor Technology, Inc. (the "Registrant") received
$200,000 from Halfmoon Bay Capital Ltd in exchange for (1) a debenture bearing
an interest rate of 9% with a maturity of one year; such debenture grants
Halfmoon Bay a security interest in all of the tangible and intangible property
of the Registrant and, to the extent such property is subject to a prior lien, a
subordinate security interest and (2) a warrant to purchase 400,000 shares of
the Registrant with an exercise price of $0.02 cents per share and an expiration
date of August 31, 2012 (the "Warrant").
Halfmoon Bay currently owns approximately 55% of the outstanding common stock of
the Registrant and beneficially owns an additional 10% of the outstanding common
stock of the Registrant by virtue of the shares underlying a 9% convertible
debenture issued by the Registrant to Halfmoon Bay on March 28, 2008. On April
10, 2009, the Registrant received $1 million from Halfmoon Bay in exchange for a
debenture bearing an interest rate of 9% with a maturity of one year. Such
debenture granted Halfmoon Bay a security interest in all of the intellectual
property of the Registrant.
A copy of the 9% debenture issued to Halfmoon Bay on March 1, 2010 is attached
hereto as Exhibit 4.1 and incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation.
The disclosures in Item 1.01 are incorporated into this Item 2.03 by reference.
Upon the occurrence of certain circumstances, such as default in payment or
bankruptcy of the Registrant, the principal amount of the 9% debenture held by
Halfmoon Bay, and any interest thereon, become immediately due and payable in
cash.
Item 3.02 Unregistered Sales of Equity Securities.
The disclosures in Item 1.01 as they relate to the Warrant are incorporated into
this Item 3.02 by reference. The exemption from registration under the
Securities Act of 1933, as amended, is Section 4(2). Halfmoon Bay is a
controlling shareholder of the Registrant.
Item 9.01 Financial Statements and Exhibits.
Exhibit No. Description
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4.1 9% Debenture
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 SENSOR TECHNOLOGY, INC.
Date: March 3, 2010 By: /s/ Philip Yee
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Name: Philip Yee
Title: Secretary, Treasurer and
Chief Financial Officer