CHINA NET & TECHNOLOGIES INC, 10SB12G, 2000-07-19

CHINA NET & TECHNOLOGIES INC
10SB12G, 2000-07-19

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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 10SB

General Form for Registration of Securities
of Small Business Issuers
Under Section 12(b)or
12(g) of the Securities Exchange Act of 1934

China Net & Technologies, Inc.
(Name of Small Business Issuer in its charter)

COLORADO 33-0702035
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

2201 N. Lamar Boulevard, Suite 205
Austin, Texas 78705
(Address of principal executive offices) (Zip Code)

Registrant's Telephone number, including area code: (888) 443-2656

Securities to be registered pursuant to Section 12(b) of the China Net:

None

Securities to be registered pursuant to Section 12(g) of the China Net:

Common Stock, no par value

Forward-Looking Statements and Associated Risk. This Registration Statement
contains forward-looking statements. These forward-looking statements are based
largely on China Net's expectations and are subject to a number of risks and
uncertainties, certain of which are beyond China Net's control. Actual results
could differ materially from these forward-looking statements as a result of the
factors, including among others, regulatory or economic influences.

ITEM 1. DESCRIPTION OF BUSINESS

China Net & Technology, Inc. ("China Net") was incorporated in the State
of Colorado on June 20, 1996 as NatureNu Corporation. On November 4, 1996 the
name was changed to Corporate Finance Company ("CFC"). CFC was formed as a
wholly owned subsidiary of TextBase Imaging Corp. ("TBI") founded in 1990. TBI
was engaged in the software development business. On November 6, 1996, the TBI,
board of directors for TBI approved and authorized a reorganization and
distribution of approximately all CFC's shares of common stock owned by TBI to
the stockholders of TBI. CFC became a specialty finance company financing
emerging growth companies. In April 2000 CFC narrowed its focus to organizing,
engaging in and funding joint ventures with Chinese companies that develop e-
commerce web-sites or manufacture and distribute Internet related products. On
May 10, 2000 CFC's name was changed to its current name to reflect its focus on
emerging companies in China.

China Net's ultimate goal is to participate in Internet related businesses
that provide e-commerce services and distribute Internet related products in
China through subsidiaries, joint ventures or partnerships. The e-commerce
business will include the development of proprietary e-commerce web-sites and
the integration of hardware and software for the development of e-commerce
websites for third parties. The Internet products to be manufacture and
distributed include Internet appliances as "thin Internet servers." A "thin
Internet server" is a server or computer that can process only a few requests
from customers at a time, as opposed to regular servers that many have to
accommodate thousands of simultaneous requests.

China Net recently acquired an 80% ownership interest in Shanghai Yazheng
Information Technology Company, Ltd., a Chinese Limited Liability Company, and
a license to manufacture and distribute a "web-modem" in China from
Tensleep.com, Inc., a Colorado corporation and affiliated company. The
"web-modem" is a thin Internet server that gathers data from an appliance or
device and the transmission of the data via the Internet. China Net is
currently seeking a Chinese manufacturing company of electronic products in
which to enter a joint venture for the manufacture and distribution of the
web-modem.

The principal executive offices, of China Net, are located at 2201 N. Lamar
Blvd, Suite 205, Austin, Texas, 78705, telephone (888) 443-2656.

Overview

China Net is a high technology and Internet related company specializing
in financing and entering strategic relationships, as joint ventures, with
emerging growth companies in China (the "Participant"). The Participants are to
be companies engaged in the development of e-commerce web-sits and the
manufacture and distribution of Internet related products in China. China Net
provides Participant's licensed technology, engineering services, intellectual
property, and other services. In addition, China Net provides Participants
funding through loans or equity participation (the "Funding"). China Net also
offers Participants active management, operating guidance, acquisition and
disposition assistance, management recruitment, and innovative financing. The
purpose of these services is to develop the future growth of the Participant, to
expand e-commerce business and to use and expand the distribution of
technological products licensed by China Net. China Net believes Participants
will be companies looking to establish or expand their e-commerce business or to
extend their production to include new Internet related products but are in need
of capital and technical know how to carry out their business plans.

China Net identifies and acquires licenses to existing and developing
technologies integrated with or relating to Internet related products. The
licenses usually include the right to manufacture the product or products and to
distribute them in China. China Net believes the licenses will be given by
small domestic companies without the resources to locate and negotiate with
Chinese company's for the manufacture of their products. China Net, with the
licenses and the joint venture with a Chinese company to manufacture the
product, can offer the product developer a reasonable cost for the fabrication
of its product.

China Net identifies and acquires interests in developing entrepreneurial -
driven Participants with business-to-business and/or business-to-consumer web-
sites or manufacturing facilities to produce electronic products and are
interested in expanding the type of product they manufacture and want to
distribute them in China. China Net plans to enter strategic relationships
through the formation of a subsidiary, which may acquire all or part of the
Participant's business or be acquired in part by a Participant. China Net
through the subsidiary will provide funding and other assistance to develop a
program for the future growth of the Participant. China Net or an affiliate may
participate in the development of the program. China Net or an affiliate may
give the Participant corporate financial services management; operational,
acquisition and disposition assistance, and licenses to manufacture and
distribute Internet related products. China Net has established certain
criteria for selecting Participants. China Net has set up appropriate policies
and procedures and its management will administer and maintain them. China Net
attempts to diversify the Participants by size, industry, product type, and
location. China Net seeks referrals from consultants who have been trading
with or otherwise dealing with Chinese companies. China Net seeks Participants
with potential, aggressive management and a business foundation.

The Participants must meet the requirements and standards approved by China
Net's Board of Directors. At its first meeting with China Net, the Participant
will provide general information about the Participant, including its financial
statements, product information and business plan. After studying this
information, China Net will work up a proposal and submit it to the Participant
and then negotiate a final agreement.

OBJECTIVE AND STRATEGY

China Net's objective is to realize value for its shareholders through the
appreciation of its common stock through participation in emerging technology
and/or Internet companies, in China, with potential growth. China Net plans to
increase value by taking joint ventures public (generally through an offering of
rights to purchase stock of the joint venture in an initial public offering [a
"rights offering"] or similar type of transaction). China Net can also enhance
value by the continued operations or the sale of joint ventures. The joint
venture generally sells newly issued shares pursuant to a rights offering.
China Net and other shareholders usually sell some of their shares in the same
rights offering. In either case, after taking a joint venture public, China Net
generally retains a significant ownership interest and board representation, and
continues to provide strategic, managerial, and operational support. Not all
joint ventures may be taken public. Some may be combined with other operating
units, some sold, and others retained as private companies.

Equity Participation

Overview. China Net is engaged in identifying, acquiring interests in and
developing relationships with technology companies in China and other companies
that engaged in diverse and various industries. China Net has acquired an 80%
ownership interest in a Chinese Limited Liability Company developing two e-
commerce web-sites and plans, at a future date, to form a subsidiary
corporation, E-China-Net.com, Inc. and transfer the partnership interest to this
subsidiary. China Net is also having discussions with several Chinese companies
regarding a joint venture to manufacture and distribute Internet products in
China. These Companies are more fully described hereafter.

Strategy. China Net seeks to identify Internet and technology companies
in China that can become emerging growth companies and take advantage of the
potential market in China. China Net will enter joint ventures, with the
Chinese companies, as a United States corporation or partnership or limited
partnership. China Net and the Chinese company will own equity as agreed.
China Net will contribute licenses to use technology in e-commerce in China or
to manufacture Internet products and distribute those products in China. China
Net will also provide all the engineering required to support e-commerce
web-sites or to manufacture the Internet products, the technical know how
transact e-commerce web-sites or to manufacture the products, and the financing
required to build the e-commerce business or manufacturing business. The
Participant is to provide the e-commerce site or manufacturing facility,
including equipment and operating personnel, distribution and marketing channels
in China and, for manufacturing, reasonable cost for manufacturing the Internet
product for sale in the United States. The Participant will benefit from China
Net's business development, management support and financing. China Net gains
exposure to Participants through direct mail solicitation, word of mouth and
reputation. China Net considers its access to potential Participants to be
good.

China Net provides technology, capital and managerial resources to
Participants. In addition, China Net encourages Participants to achieve the
superior returns on investment generally provided by public offerings of the
joint venture, but only if it is appropriate for the development of the
business.
Because China Net's relationship with its Participants is intended to be long
term, it has the flexibility to maximize the value of the joint venture through
a public offering at the appropriate time, through a sale of the joint venture
or Participant to a third party, through a combination of the company with
another company or through retention of the Participant as an operating unit of
China Net. In addition, China Net is committed to the use of management stock
ownership and equity incentives as the principal means of aligning the interests
of management, its Participants and China Net with the interests of its
shareholders.

China Net evaluates Participants from many perspectives. It looks for
companies that can develop into niche markets in e-commerce or manufacturing.
It generally seeks companies that have a core management team in place and are
producing and delivering products and/or services, and have excess manufacturing
capabilities and the potential of distribution in China.

Once a joint venture is established with a Participant, China Net's
corporate staff or an affiliate provides hands-on assistance to the managers of
the Participant in management, financial, marketing, tax, risk management, human
resources, legal and technical services.

China Net's goal is to maximize the value of Participants for China Net's
shareholders, often through taking joint ventures public through a rights
offering, at the appropriate time, or other similar transactions. A rights
offering is an initial public offering of the joint venture, directed to China
Net's shareholders. It will involve the grant to China Net's shareholders of a
transferable right to buy shares of the joint venture's stock at a price
established by the joint venture, China Net, and any underwriter. China Net
shareholders can exercise the rights, thereby participating in the rights
offerings usually reserved for larger investors, or they may sell the rights at
the prevailing market price, if a market is made. Growth in the value of the
public joint venture benefits China Net and directly benefits its shareholders
who continue to hold the shares purchased in the rights offering. However, not
all joint ventures may be taken public. Some Ventures may be combined with
other operating units, some sold, and other retained as private companies.

Operational Plan.

China Net's operational plan is to identify Chinese companies developing
e-commerce web-sits with potential for significant revenues in the near term and
above normal profits in the future. In addition, China Net is continually
evaluating domestic companies developing new Internet appliances that can be
used in the development of businesses as service providers in e-commerce. China
Net is continually seeking out and negotiating with domestic companies. The
negotiations are for (1) the manufacture of that company's product or products
in China and importation to the United States for domestic distribution; (2) a
license to manufacture and distribute its product or products in China; (3)
arranging a joint venture with a Chinese manufacturer; and (4) providing limited
financing.

RECENT DEVELOPMENTS

E-COMMERCE

E-China-Net.com, Inc.

China Net, as part of its strategy to participate in the development of e-
commerce businesses in China, plans to form a division or a wholly owned
subsidiary, E-China-Net.com ("E-China"). E-China's mission is to create or
acquire ownership interests in e-commerce web-sites and to manage the most
diverse network of Internet companies in China and to introduce the most
advanced Internet technology in China.

E-China plans to be in the forefront of the Chinese Internet revolution and
plans to capitalize on the many opportunities of this emerging marketplace. The
plan is to do so through management, a highly targeted strategic focus, and a
unique business model that demand and drives growth. E-China's strategic
business model calls for it to build upon the future value, growth, and
technology of tomorrow's leading Chinese Internet companies.

E-China's objectives are (1) to generate consistent and sustainable growth,
(2) to establish a successful track record, (3) to build a Chinese network, and
(4) to introduce advanced technology to China.

The management believes that the Keys to E-China's success will be to (1)
establish web-sites when practical, (2) capitalize on user traffic, (3) develop
an aggressive marketing program, and (4) establish E-China as a technology
leader.

China Net, in April 2000, acquired an 80% ownership interest in Shanghai
Yazheng Information Technology Company, Ltd., a Chinese Limited Liability
Company (the "Shanghai Company"), and it plans to transfer its ownership
interest in the Shanghai Company into E-China.

Shanghai Company

The Shanghai Company was formed March 16, 2000 in Shanghai in the Peoples
Republic of China. The company was formed to create an Internet environment
attractive to the vast consumer markets in China. The company's management is
developing two reverse auction platforms or web-sites. One site is for the
consumers and the other is for businesses. The business was formed in Shanghai
to reduce the cost of the talented programmers and marketing personnel required
to develop the sites to promote them and to gather the traffic necessary to make
the sites successful. The company's strategy is to build an impressive
destination that provides a core value upon which to market the company's
sites.
The company's management believes there is no competition in that marketplace.
The company's sites can be found at http://www.e315net.com and
http.//www.e315web.com. The management of this company plans to generate
revenues from fees paid by vendors and manufacturers. It plans to attract
vendors and manufacturers by building many registered consumers ("Members") by
building brand equity and awareness. The key to the business model is giving
vendors a platform to bid for the sell of merchandise directly to the Members
and Members to deal directly with vendors willing to sell at competitive prices.
The Shanghai Company is not required to handle any of the merchandise bought
from the vendor.

The Shanghai Company's business plan calls for the development of its e-
commerce platforms within the major market areas of China, with the first being
located in Shanghai. The web-site will be designed so that each user must
register, at no cost, to access the site from the initial address of the site.

The Shanghai Company's web-sites must be fun, easy to use and informative.
To gain recognition, the sites must be worthy of attention. The design work
should promote the feeling of superior quality and make the Members fee good
about using this easy to use reverse auction platform.

The e-commerce market in China is growing exponentially with the number of
users doubling every six months. All trends in the China market indicate that
strong web presence will be an absolute necessity and not a frivolous extra.

The Company believes there is only one auction web-site in China now. That
site is using a regular auction as their platform. The Shanghai Company
believes that Chinese consumers do not desire to bid items up, as in a regular
auction. In addition, the company believes the marketplace is too large for the
individual to cover completely and a best price market better services the
consumers. The company's concept is to bring the vendor to the consumer and
have vendors compete for the consumers business.

MANUFACTURE AND DISTRIBUTION OF INTERNET PRODUCTS

In March of 2000 China Net acquired a license agreement from Tensleep.com,
inc., for the right to manufacture and distribute the "web-modem" currently
under design by Tensleep. Besides the license agreement, Tensleep increased the
amount of its investment in China Net through an exchange of shares between the
two companies. The reason for the license agreement and the exchange of shares
was to make China Net its partner to facilitate the acquisition of business
interests engaged in e-commerce and the manufacture and distribution of Internet
products in China.

China Net is currently negotiating with several Chinese companies to both
enter joint ventures for the manufacture of Internet Products licensed by China
Net or to manufacture the products in China.

Tensleep.com, Inc.

Tensleep.com, Inc. ("Tensleep"), founded in 1997, an affiliate of the
Company is an Integrated Internet Development Stage Company. Tensleep's
Internet Technology Division, Tensleep Technologies, Inc., is focusing on both
designing, developing, marketing and selling products used in the Internet
infrastructure and providing Internet services and solutions. The E-Commerce
Division, Tensleep Finance.com, Inc., is focused to developing and managing
E-Commerce services, including Financial Services.

Tensleep Technologies is marketing a family of facsimile products,
developing the prototypes for several Internet-based products and has completed
the concept design for another Internet-based product. The facsimile products
are fabricated by Samsung Electronics Co., Ltd. The first Internet-based
product being prototyped is a special purpose modular computer or server (the
"CyberServer" or "web-modem"). Other products being prototyped include an
"icradle," a "home controller," and a "motor controller." The next product
under consideration is a communications device. Tensleep's products are being
developed through a strategic relationship with third parties.

Tensleep's technology includes a combination of hardware and digital signal
processing software integrated into an integrated circuit. Digital signal
processing technology coverts analog signals to data in a digital format, the
data is then mathematically processed for use in that format or converted back
into analog signals. Digital signal processing has many uses, e.g., modems,
motor controls, disk file head positioning systems, sonars, and many others.

Finance.com's focus is directed to developing service providers, developing
a financial portal and providing E-Commerce technical development services to
others. Financial and Investment services are planned to be provided to small
business's and individuals.

Dependence on One or a Few Major Participants.

China Net expects to participate with several Participants in order to
obtain diversification.

Employees.

China Net currently employs two full time persons, one part time person and
will employ others as required.

China Net is not subject to any collective bargaining agreement. It is
anticipated that China Net's employees will be covered by an employee stock
option plan which is being submitted as an exhibit to this Registration
Statement.

Seasonal Nature of Business.

China Net's business activities are not seasonal.

RISK FACTORS

China Net cautions that the factors described below could cause China Net
actual results or outcomes to differ materially from those expressed in any
forward-looking statements made by or on behalf of China Net.

Limited Operating History and Uncertainty of Future Operating Results.

China Net has limited operating history and expects to incur losses due to
minimal general and administrative expenses until sales of Participant's
securities or revenues from the Participants are obtained. China Net believes
that upon commencement of operations, China Net's future operating results over
both the short and long term will be subject to annual and quarterly
fluctuations due to several factors, some of which are outside the control of
China Net. These factors include but are not limited to fluctuating market
demand for the joint venture's products, expansion of the market for the
products, pricing, competitive products and general economic conditions.

Competition.

There is significant competition in the electronics manufacturing and e-
commerce industry. China Net will compete with established companies and other
entities, many that possess substantially greater resources than China Net.
Almost all of the companies with which China Net will compete are substantially
larger, have more substantial histories, backgrounds, experience and records of
successful operations, greater financial, technical, marketing and other
resources, more employees and more extensive facilities than China Net now has,
or will have in the foreseeable future. It is also likely that other
competitors will emerge in the near future. There is no assurance that China
Net will compete successfully with other competing companies. Inability to
compete successfully might result in increased costs, reduced yields and
additional risks to the investors herein.

No Public Market.

There is presently no public market for the common shares of China Net and
there is no assurance that an active public market will ever develop.
Consequently, investors will not be able to liquidate their investment in the
event of an emergency or for any other reason.

Financial Condition.

Although the officers of China Net anticipate that China Net will have
adequate funds to pay all of its operating expenses assuming China Net commences
its proposed business plan, there can be no assurance that this will in fact
occur or that China Net can be operated in a profitable manner. Profitability
depends upon many factors, including the ability to develop strategic
relationships with profitable Participants.

Lack of Dividends.

There can be no assurance that the operations of China Net will become
profitable. At the present time, China Net intends to use any earnings that may
be generated to finance the growth of China Net's business.

Need for Cash.

As China Net enters into operations, additional cash will be required in
the near term to achieve China Net's financial and operating objectives. If
China Net is unable to raise sufficient cash to fund its growth, China Net may
be unable to achieve the anticipated financial results. There can be no
assurance that adequate funds will be available on terms acceptable to China
Net.

Losses from Operations.

China Net has incurred substantial losses from operations since commencing
operations, and although it expects to become profitable for its year ending
September 30, 2000. There is no assurance that this will happen.

Trends and Uncertainties.

The demand for China Net's products and services and its ability to develop
strategic relationships will be dependent on, among other things, market
acceptance of China Net's concept, its proposed operations and general economic
and market conditions.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The statements contained herein may be based, in part, on management's
estimates, projections, plans and judgments. These are forward looking
statements and involve a number of risks and uncertainties. A number of
factors, which could cause actual results to differ significantly include:
general economic conditions, competitive market influences, technology changes,
and other influences beyond the control of management.

Results of Operations.

The Company's results of operations are for the six month period ended
March 31, 2000 compared to the years ending September 30, 1999 and 1998. The
results for the six month period, unaudited, are compared to the audited results
for the two years.

The Company's revenues for the six months are $894,435 which are an
increase of $757,030 over the revenues for the year ending September 30, 1999
and an increase of $866,828 for the year ending September 30, 1998. The
increase is due to the gain from the private sale of securities of Tensleep.com,
Inc.

The Company's operating expenses for the nine months are $241,925 and
represents an increase of $35,947 over the operating expenses for the year
ending September 30, 1999 and a decrease of $11,539 for the year ending
September 30, 1998. The increase in 1999 is due to additional outside services
paid for by the Company.

The Company's net income for the six months are $364,310 (Net Income Per
Share of $0.11)_and represents an increase of $432,883 over the net loss for the
year ending September 30, 1999 (1999 Net Loss Per Share of $0.02)and an increase
of $676,596 for the year ending September 30, 1998 (1998 Net Loss Per Share of
$0.09). The increase is due to the gain from the private sale of securities of
Tensleep.com, Inc.

The Company may experience significant fluctuations in its results of
operations in the future. Such fluctuations may result in volatility in the
price and/or value of the Company's common stock if an market develops. Results
of operations may fluctuate as a result of a variety of factors, including the
appreciation or lack thereof in the Company's interest in strategic
relationships entered into by the Company and the revenues generated by the sale
of electronic products licensed by the Company.

Accordingly, the Company believes that period to period comparisons of
results of operations should not be relied upon as an indication of future
results of operations. There can be no assurance that the Company will continue
to be profitable. It is likely that in one or more future periods the Company's
operating results will be below expectations.

Liquidity and Capital Resources

The Company had a working capital surplus of $447,803 and stockholders'
equity of $812,503 at June 30, 2000. The Company believes that this working
capital surplus will be sufficient to conduct the Company's operations for the
next 12 months.

Plan of Operation.

China Net has described its plan of operation for the next 12 months in
Item 1, Description of Business and incorporates the same herein.

China Net believes that its cash is sufficient to meet its cash
requirements for the next 12 months. The Company will not perform any product
research and development during the term of this plan. Nor does the Company
expect to purchase or sale plant and significant equipment or expect significant
changes in the number of employees.

ITEM 3. DESCRIPTION OF PROPERTY.

China Net's executive offices are located at 2201 N. Lamar Boulevard, Suite
205, Austin, Texas 78705. These offices consist of 1,000 square feet of office
space. These offices are rented on a month per month basis with the rent paid
by an affiliate.

ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The Company, as of June 30, 1999, had 8,894,234 shares of its Common stock
issued and outstanding with 250,000 options granted. The following schedule
tabulates holders of Common Stock of the Company by each person who holds or
record or is known by Management of the Company to own beneficially more than
five percent (5%) of the Common Stock outstanding, and, in addition, by all
Officers and Directors of the Company Individually, and as a group. The
Shareholders listed below have sole voting and investment power.

OWNERSHIP MORE THAN 5%

Class of Securities Name Number of Percent of
Shares Outstanding

Common Stock Tensleep.com, Inc. 2,818,336 31%
2201 N. Lamar
Austin, TX

Total 2,818,336 31%

MANAGEMENT
Class of Securities Name Number of Percent of
Shares Outstanding

Common Stock Ronald S. Tucker 1,663,986(1) 18%
79860 Tangelo
La Quinta, CA

Common Stock James Y. Wang 3,100,000(2) 34%
400 Mary Lane
Maplewood, MN

Common Stock Jay C.T. Jai 50,000(3) .6%
1326 W. Winton Ave
Hayward, CA

All Directors & Officers as a
Group 4,813,986 52.6%

(1) 1,487,000 shares are owned by Ronald S. Tucker and his wife as Joint
Tenants, 76,986 shares are held by R Tucker & Associates, Inc., in which
Ronald S. Tucker is an officer, director and major shareholder, and
100,000 are in the form of options.

(2) James Y. Wang and his wife Lei Li each hold 1,500,000 shares in their
individual names, and James Y. Wang has 100,000 options.

(3) This represents 50,000 options.

ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.

Board of Directors.

The following persons listed below have been retained to provide services
as director until the qualification and election of his successor. All holders
of common stock will have the right to vote for Directors of China Net. The
board of directors has primary responsibility for adopting and reviewing
implementation of the business plan of China Net, supervising the development
business plan, review of the officers' performance of specific business
functions. The board is responsible for monitoring management, and from time to
time, to revise the strategic and operational plans of China Net. Directors
receive no cash compensation or fees for their services rendered in such
capacity.

The following are the Officers, Directors, and Key Management of the
Company.

Name Position

Ronald S. Tucker Director and Chief Executive Officer and Chief
Financial Officer

James Y. Wang Director and President and Chief Operating
Officer

Jay C.T. Jai Director

Ronald S. Tucker, 61, Chief Executive Officer and Chief Financial Officer
and Director is the founder of the Company. In 1997, Mr. Tucker founded
Tensleep.com, Inc. (OTC BB:TENS) and is now its President. Since 1990. to
present, Mr. Tucker was the founder and President and director of R Tucker &
Associates, Inc., a financial consulting firm. Mr. Tucker has been owner and
manager of several business ventures and has been engaged in the private
practice of law. Mr. Tucker is a graduate of the University of California at Los
Angeles where he received a Bachelor of Science while majoring in finance and
accounting. Mr. Tucker is also a graduate of the Loyola University School of
Law. Mr. Tucker is a member of the California and Texas Bar Associations.

James Y. Wang, age 39, is the President, Chief Operating Officer and
director of the Company. Mr. Wang from 1994 to 1999 was the President of
International Trading System Company. In addition from 1998 to present Mr. Wang
is the President Master Financial Group which is the publisher of
analystgroup.com a financial Internet newsletter. Between 1994 and 1999 Mr.
Wang was a research scientist and Assistant Professor, Lab Director at the
University of Minnesota School of Medicine. Mr. Wang received a Bachelor of
Science degree from the University of Science and Technology in Hefei, China in
1985, a Master of Science Degree from the Shanghai Second Medical Immunology
University, Shanghai, China in 1988, and his Ph.D. degree from the University
of Arizona in 1994.

Jay C.T. Jai, age 65, is a director of the Company. Mr. Jai since 1994 to
present is the President and Chief Operating Officer of CTJ Corporation an
international trading and offshore manufacturing company. Mr. Jai has a
Bachelor and Master of Science degree from Utah State University (1967 and 1969,
respectively) and a Master of Business Administration from the University of
Phoenix (1972).

Each director serves for a term of one year and is subject to reelection
at the annual meeting of shareholders.

ITEM 6. EXECUTIVE COMPENSATION.

The Company's officers and directors, during this time, to conserve
capital, have agreed to work for no compensation but reimbursement of business
expenses, out of pocket costs and consulting fees as cash is available. At a
time the Board determines is appropriate, the Company will enter employment
agreements with the officers and establish compensation for the directors. The
Company, at its year end, authorized the accrual of a consulting fee of $120,000
for services provided by R Tucker & Associates for the year ending September 30,
1999. These fees were paid during the current year.

The following table reflects the Executive Compensation for the year ending
September 30, 1999:

SUMMARY COMPENSATION TABLE

Name and Other Annual
Principal Position Compensation

Ronald S. Tucker, CEO $143,550(1)

(1) Represents consulting fees to R Tucker & Associates, Inc. for services
performed by Ronald S. Tucker.

QUALIFIED AND NON QUALIFIED STOCK OPTIONS

The board of directors and shareholders for the Company have adopted a Qualified
and Non Qualified Stock Option Plan pursuant to Sections 421-424 of the Internal
Revenue Code. The Plan authorizes the granting of up to 500,000 and 800,000
options to purchase Company common stock under the Qualified and Non Qualified
Plan, respectively. The Plan is administered by the Board of Directors or by a
committee appointed by the Board. As of the date of this document Non Qualified
Options exercisable within five years have been granted as follows:

Ronald S. Tucker 100,000 @ $0.50 per share
James Y. Wang 100,000 @ $0.50 per share
Jay C.T. Jai 50,000 @ $0.50 per share

EMPLOYMENT AGREEMENTS

The Company at this time has not entered an employment agreement with any
of the officers or directors. The management does not believe that an agreement
will be entered until after September 2000.

SALES COMMISSIONS

The Company does not anticipate that there will be any sales commissions.

ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

On June 30, 1998 the Company pursuant to Regulation D, Rule 504 issued
80,000 shares of its common stock to Tensleep.com, Inc. in exchange for
1,000,000 investment units valued at $200,000. Each investment unit consisted
of one share of common stock and one warrant to purchase one share of commons
stock.

On March 31, 2000 the Company pursuant to Section 4(2) of the Act issued
500,000 shares of its common stock to Tensleep.com, Inc. in exchange for outside
services paid for by Tensleep valued at $206,667 and 100,000 shares of
Tensleep.com, Inc.'s common stock valued at $80,000.

On April 22, 2000 the Company pursuant to Section 4(2) of the Act issued
2,000,000 shares of its common stock to Tensleep.com, Inc. in exchange for
400,000 shares of Tensleep's common stock valued at $1,000,000.

On April 22, 2000 the Company pursuant to Section 4(2) of the Act issued
3,000,000 shares of its common stock to James Wang and his wife, Lei Li, in
exchange for an 80% ownership interest in Shanghai 3W Information Technology
Company, Ltd. valued at $1,500,000.

ITEM 8. LEGAL PROCEEDINGS

The Company is not involved in any litigation incidental to its business
or material to the business activities or financial performance of the
Company.

ITEM 9. MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS.

Market Information.

There is no established public trading market for the Company's common
stock. There are 200,000 options issued and outstanding. There are no shares
that could be sold pursuant to Rule 144 under the Securities Act or under any
agreement to register under the Securities Act for sale by security holders. The
Company is not publicly offering equity securities and has no current intention
to do so.

Holders.

The Company has approximately 500 holders of record of its common stock.

Dividends.

On March 29, 2000 the Company's Board of Directors declared a stock
dividend payable on or before April 30, 2000 to stockholders of record on March
31, 2000. Stockholders holding more than 25,000 shares of the Company's common
stock will receive one additional share for each share owned by them on March
31, 2000. Shareholders owning at least 20 shares, but not more than 25,000
shares will receive $0.05 per share cash dividend. Shareholders owning 20
shares or less will receive nothing.

ITEM 10. RECENT SALES OF UNREGISTERED SECURITIES.

Prior to July 1, 1997 the Company (1) pursuant to Regulation D, Rule 504
exchanged 1,360,000 shares of its common stock with R Tucker & Associates, Inc.,
for a license to its relational database management system software valued at
$200,000, (2) pursuant to Regulation D, Rule 504 sold 58,600 shares to
unaffiliated third party investors in the amount of $134,000, (3) pursuant to
Section 4(2) of the Securities Act of 1933, as amended (the "Act"), exchanged
140,000 shares for services provided by Ronald S. Tucker valued at $14,000, (4)
pursuant to Rule 144 exchanged 110,000 shares with unaffiliated third party
consultants for services valued at $110,000.

On June 30, 1998 the Company pursuant to Regulation D, Rule 504 issued
80,000 shares of its common stock to Capital Technologies, Inc. in exchange for
500,000 shares of Capital Tech common stock and 1,000,000 warrants to purchase
another 1,000,000 shares at $0.40 per share valued at $200,000.

ITEM 11. DESCRIPTION OF SECURITIES.

The authorized capital stock of the Company consists of 20,000,000
authorized shares of common stock, with no par value per share ("Common Stock"),
and 10,000,000 shares of preferred stock, with no par value per share
("Preferred Stock").

Common Stock

The holders of shares of Common Stock have no preemptive rights to maintain
their respective percentage ownership in the Company. Nor do they have any other
subscription rights for other securities of the Company. Shares of Common Stock
are not redeemable or subject to further calls or assessments. All of the
outstanding shares of Common Stock are fully paid and non assessable. The shares
of Common Stock to be outstanding are fully paid and non assessable. The holders
of shares of Common Stock are entitled to share pro rata in such dividends, if
any, as may be declared by the Board of Directors of the Company out of funds
legally available therefor. Subject to the prior rights of holders of shares of
Preferred Stock, if any, upon liquidation, dissolution and winding up of the
Company, holders of shares of Common Stock are entitled to share ratably in the
net assets available for distributions to such holders. Holders of Common Stock
are entitled to vote upon all matters submitted to a vote of the stockholders of
the Company and will be entitled to one vote per share held, except in the
election of directors where the holder will be entitled to one vote per share
held times the number of directors to be elected. Generally, the vote of the
majority of the shares represented at a meeting of the stockholders and entitled
to vote is sufficient for actions that require a vote of the stockholders.

Preferred Stock

The Board of Directors is authorized, without any further action by the
shareholders, to issue Preferred Stock from time to time in such series, in such
a number of shares and with such dividends, redemption, liquidation, voting,
conversion, sinking fund and other rights as the Board will establish. The
Company has no present intention, commitment or understanding to issue preferred
securities of any type or kind.

The Transfer Agent and Registrar for the Common Stock are the Executive
Registrar & Transfer Agency, Inc., at 3118 West Thomas, Suite 707, Phoenix, AZ
85017. Its telephone number is (602) 415-1273.

ITEM 12. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

The Company's Bylaws provide that the Company will indemnify its Directors
and officers to the fullest extent permitted by law against certain losses that
may be incurred concerning any proceeding that arises because such person is or
was an agent of the Company. The Company believes that indemnification under the
Bylaws covers at least negligence and gross negligence by an indemnified party,
and permits the Company to advance litigation expenses for stockholder
derivative actions or other actions, against an undertaking by the indemnified
party to repay those advances if it is ultimately determined that the
indemnified party is not entitled to indemnification.

In addition, the Company's Articles of Incorporation provide that, pursuant
to Colorado law, its Directors will not be liable to the Company or its
stockholders for monetary damages for and act or omission in the Director's
capacity as a Director. This provision does not eliminate or limit the liability
of a Director to the extent the Director is found liable for a breach of the
Director's duty to loyalty to the Company, for acts or omissions lacking good
faith or involving intentional misconduct, or a knowing violation of the law,
for actions leading to improper personal benefit to the Director and for an act
or omission for which the liability of the Director is explicitly provided by
applicable statute. The provision also does not affect a Director's
responsibilities under any other law, such as federal securities laws or state
and federal environmental laws.

ITEM 13. FINANCIAL STATEMENTS.

Attached as Exhibits.

ITEM 14. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

None.

ITEM 15. FINANCIAL STATEMENTS AND EXHIBITS.

(i) Financial Statements. *

The following is a list of all financial statements filed as a part of this
Report:

1. Audited Balance Sheet - September 30, 1999 and 1998.

2. Audited Statement of Operations for year ending September 30, 1999
and 1998.

a. Audited Statement of Stockholders' Equity for the year ended
September 30, 1999 and 1998.

b. Audited Statement of Cash Flows for the year ended September
30, 1999 and 1998.

c. Notes to Financial Statements - September 30, 1999 and 1998.

1. Unaudited Balance Sheet - March 31, 2000.

2. Unaudited Statement of Operations for period six months ending March
31, 2000.

a. Unaudited Statement of Stockholders' Equity for the six months
ended March 31, 2000.

b. Unaudited Statement of Cash Flows for the six months ended
March 31, 2000.

c. Notes to Financial Statements - March 31, 2000.

(b) Exhibits.

Exhibit No. Description Method of Filing

3. Charter and Bylaws
3.1 Articles of Incorporation *
3.1.1 Amended Articles for change of Name *
3.1.2 Amended Articles for change of Name *
3.2 Bylaws *

10. Material Contracts
10.1 License Agreement with Tensleep.com, Inc., *
10.2 Stock Option Plan *

11. Statement re: Computation of Per Share Earnings **

27. Financial Data Schedule *

99. Additional Exhibits
99.1 Acquisition Agreement of Shanghai Company *

* Filed herewith.
** Contained in Financial Statements included herewith.

SIGNATURES

In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.

China Net & Technologies, Inc.
(Registrant)

Signature Title Date

/S/ Ronald S. Tucker CEO and CFO, Director July 13, 2000
Ronald S. Tucker

/S/ James Y Wang President and COO, Director July 13, 2000
James Y Wang

/S/ Jay C.T. Jai Director July 13, 2000
Jay C.T. Jai

Auditor's Report
EX-(a)1.
BRABO, CARLSEN & CAHILL
Certified Public Accountants
1111 E. Tahquitz Canyon Way, Suite 203,
Palm Springs, CA 92262
Ph: 760-320-0848 fax: 760-322-4626

INDEPENDENT AUDITORS' REPORT

The Board of Directors
Corporate Finance Company

We have audited the accompanying balance sheets of Corporate Finance Company (a
Colorado Corporation), as of September 30, 1999 and 1998, and the related
statements of operation, changes in stockholders equity (deficit), and cash
flows for the years then ended. These financial statements are the
responsibility of the Company's management. Our responsibility is to expresses
an opinion on these financial statements based on our audit.

We conducted our audits in accordance with generally accepted auditing
standards.
Those standards require that we plan and perform the audits to obtain reasonable
assurance as to whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Tensleep Design, Inc. as of
September 30, 1999 and 1998 and the results of its operation, changes in
stockholders equity and its cash flows for the year then ended, in conformity
with generally accepted accounting principles.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As shown in the financial statements
and as discussed in Note 9, the Company incurred a net loss of $68,573 for the
year ended September 30, 1999 and has incurred substantial losses in the past
two years. In view of this, realization of a major portion of the assets in the
accompanying balance sheet is dependent upon the Company's success in its future
operations and realization of its investments.

June 7, 2000.
Brabo, Carlsen & Cahill

CORPORATE FINANCE COMPANY

BALANCE SHEETS

SEPTEMBER 30, 1999 AND 1998

<TABLE>
<CAPTION>
ASSETS
<S> <C> <C>
1999 1998
CURRENT ASSETS

Cash $ 374 $ 4,609
Due from affiliated company (See note 1) 14,456 14,456
Receivable from affiliated company (See note 10) 140,000 -
Shareholder advances (See note 2) 50,000 11,648
Trading Securities (See note 3) - 58,738
----------- ----------
Total Current Assets 204,901 89,451

PROPERTY AND EQUIPMENT

Software (See note 11) - 200,000
----------- ----------
- 200,000
Less accumulated depreciation and amortization - 150,012
----------- ----------
Net Property and Equipment - 49,988
----------- ----------

OTHER ASSETS

Investment in Tensleep Technologies, Inc. at cost 124,200 124,286
Investment in Capital Technology, Inc. at cost (S - -
Organization expenses (net of accumulated amortize
of $26,010 in 1999 and $17,340 in 1998) 17,340 26,010
----------- ----------
Total Other Assets 141,626 150,296
----------- ----------

TOTAL ASSETS $ 346,527 $ 289,735
=========== ==========

</TABLE>

CORPORATE FINANCE COMPANY

BALANCE SHEETS

SEPTEMBER 30, 1999 AND 1998

<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
1999 1998

CURRENT LIABILITIES
Accrued consulting fees (See note 10) $ 185,000 $ 55,000
Due on margin account (See note 3) - 4,635
----------- ----------

Total Current Liabilities 185,000 59,635
----------- ----------

TOTAL LIABILITIES 185,000 59,635
----------- ----------

STOCKHOLDERS' EQUITY
Preferred stock, no stated value, 10,000,000 - -
shares a no shares issued and outstanding

Common stock, $.01 stated value, 20,000,000 18,266 18,266
shares authorized, 1,826,600 shares issued
and outstanding at September 30, 1999 and 1998.

Additional paid-in capital 847,609 847,609

Accumulated deficit (704,348) (635,775)
----------- ----------

TOTAL STOCKHOLDERS' EQUITY 161,527 230,100
----------- ----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 346,527 $ 289,735
============ ==========

The accompanying notes are an integral part of these statements.

CORPORATE FINANCE COMPANY
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED SEPTEMBER 30, 1999 AND 1998

</TABLE>
<TABLE>
<S> <C> <C>
1999 1998
REVENUES
Consulting Fees (See note 10) $ 140,000 $ -
Interest and dividend Income 1,091 12,846
Realized gain (loss) from trading securities (3,786) 22,572
Unrealized gain (loss) from trading securities - ( 7,811)
(See note 3)
Other Income 100 -
----------- ----------
137,405 27,607
----------- ----------
EXPENSES
Automobile expense 494 1,208
Bank service charges 233 147
Consulting expense (See note 10) 143,550 145,479
Depreciation and Amortization 58,658 75,342
Filing fees 45 -
Insurance 35 -
Interest expense - margin account 208 1,925
Other expenses 364 750
Outside services 535 23,035
Postage & delivery 26 302
Printing and reproduction - 550
Promotion - 110
Rent 1,300 2,900
Repairs - 186
Telephone 330 485
Travel & Entertainment 200 958
Utilities - 87
----------- ----------
205,978 253,464
----------- ----------
INCOME (LOSS) FROM OPERATIONS (68,573) (225,857)
----------- ----------
OTHER INCOME (EXPENSE)
Gain on appreciation of securities
(See note 13) - 113,571
Loss on permanent decline in value of
investment (See note 5) - (200,000)
----------- ----------
- (86,429)
----------- ----------
NET LOSS (68,783) (312,286)

ACCUMULATED DEFICIT - BEGINNING OF YEAR (635,775) (323,489)
----------- ----------
ACCUMULATED DEFICIT - END OF YEAR $ (704,348) $ (635,775)
=========== ==========

LOSS PER COMMON SHARE (SEE NOTE 12) $ (0.02) $ (0.09)
=========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.

CORPORATE FINANCE COMPANY

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

FOR THE YEARS ENDED SEPTEMBER 30, 1999 and 1998

<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Additional
See Number of Common paid-in Accumulated
note Date shares Consideration stock capital Deficit Total

Balance, October 1, 1997 1,666,600 $ 16,666 $ 441,334 $(134,175) $ 323,825

Stock issued 7A 11/10/199 80,000 Non-cash 800 199,200 - 200,000

Stock issued 7B 11/10/199 80,000 Non-cash 800 199,200 - 200,000

Contributed Capital 10 12/08/1997 7,875 - 7,875

Property Dividend 13 01/15/1998 (189,286) (189,286)

Cash Dividend 13 01/15/1998 (28) (28)

Net Loss (312,286) (312,286)
--------- -------- --------- ---------- ----------
Balances at
September 30, 1998 1,826,600 18,266 847,009 (635,775) 230,100

Net loss - - - (68,573) (68,573)
--------- ------- -------- --------- ---------
Balance, September 30, 1999 1,826,600 $18,266 $847,609 $(704,348) $ 161,527
========= ======= ======== ========== =========

</TABLE>

The accompanying notes are an integral part of these statements.

CORPORATE FINANCE COMPANY

STATEMENTS OF CASH FLOWS

SEPTEMBER 30, 1999 AND 1998

<TABLE>

<S> <C> <C>
1999 1998

CASH FLOW FROM OPERATING ACTIVITIES
Net loss $ (68,573) $ (312,286

Adjustments to reconcile net loss to net
cash used in operations:
Depreciation and amortization 58,658 75,342
Loss on permanent decline in value of
investment - 200,000
Gain on appreciation of securities used
for property dividend - ( 113,571)
(Increase) decrease in assets:
Accounts receivable (140,000) -
Trading securities 58,738 9,381
Increase (decrease) in liabilities:
Accrued consulting fees 130,000 55,000
Due on margin account (4,635) (5,794)
------------ -----------
Net cash used by operating activities 34,188 (91,928)
------------ -----------
CASH FLOWS FROM INVESTING ACTIVITIES

Advances to affiliate - (14,456)
----------- -----------
Net cash used by investing activities - (14,456)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Shareholder loan (used to pay for
consulting fees) - 75,000
Shareholders Advance (38,450) (12,000)
Dividends Paid - (28)
------------ -----------
Net cash provided by financing activities (38,450) 62,972
------------ -----------
NET INCREASE (DECREASE) IN CASH (4,262) (43,412)

CASH, beginning of period 4,609 48,021
----------- ----------
CASH, end of year $ 347 $ 4,609
=========== ==========

</TABLE>

The accompanying notes are an integral part of these statements.

CORPORATE FINANCE COMPANY

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 1999 AND 1998

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

Corporate Finance Company (The Company) (A Colorado Corporation) is a
specialty finance company and holding corporation, offering temporary management
resources and financial assistance to development stage and start up companies
in the technology or technology related sector. The Company was incorporated in
June 1996 as NatureNu Corporation. In September 1996 the Board of Directors
voted to change the Company's name from NatureNu Corporation to Corporate
Finance Company. The Company's business strategy does not incorporate venture
capital funding nor investing long term in venture capital type companies, but
involves a program of project assistance for an agreed period. On completion of
a project assistance program, the Company is entitled to recoup its financial
investment or loans (if any) and to be paid management fees for its assistance.
In certain instances, the Company may agree to acquire or to incorporate a
target company as a investment of the Company, but the holding period for such
companies is intended to be temporary, not indefinite.

Cash and Cash Equivalents

For the purpose of financial statement reporting, the Company considers all
highly liquid investments with maturity of 3 months or less to be cash
equivalents.

Concentration of Credit Risk

The Company maintains its operating cash account at a commercial bank in
Dana Point, California. The account at the bank is guaranteed by the Federal
Deposit Insurance Corporation (FDIC) up to $100,000.

Property and Equipment, Depreciation and Amortization

Property and equipment obtained in exchange for stock are carried at the
fair market value of the equipment on the date of exchange. Property and
equipment purchased by the Company is carried at cost as of the date of
purchase.

Depreciation and amortization are computed using the straight-line method
over the assets' expected useful lives. The useful lives of property and
equipment for purposes of computing depreciation and amortization are:

Machinery & Equipment 3 years
Software 3 years
Organization Expenses 5 years

Repairs and maintenance are charged to operations when incurred. Costs of
betterments, which materially extend the useful lives of the assets, are
capitalized. Gains and losses from sales or disposition of assets are included
in the statement of operation.

Trading Securities

Trading securities consist of equity securities that are bought and held
principally for the purpose of selling them in the near term and are classified
as trading securities and are reported at fair value, with unrealized gains and
losses included in earnings.

Fair Value of Financial Instruments

For the Company's financial instruments, the carrying value is considered
to approximate the fair value. Cash and accounts payable are settled so close to
the balance sheet date that fair value does not differ significantly from the
stated amounts.

Adjustments

In the opinion of management the data reflects all adjustments necessary
for a fair statement of results for this period. All adjustments are of a
normal and recurring nature.

NOTE 1: DUE FROM AFFILIATED COMPANY

The Company has loaned funds to Tensleep Technologies, Inc., a related
party, to cover certain operating expenses of the related company. The balance
due on the loan is $14,456 as of September 30, 1999 and 1998 and is covered by a
non-interest bearing demand note. As of the date of this audit report Tensleep
Technologies, Inc has paid the balance due of $14,456 in full.

NOTE 2: SHAREHOLDER ADVANCE

In connection with normal operations the shareholder advances funds to, and
receives funds from the Company. The Company has shareholder advance
receivables of $50,098 and $11,648 as of September 30, 1999 and 1998,
respectively. The advances to and from the shareholder do not bear interest and
also have no specific repayment terms.

NOTE 3: TRADING SECURITIES

As of September 30, 1998 trading securities consist of securities that are
bought and held principally for the purpose of selling them in the near term.
Trading Securities are reported at fair value on the balance sheet. At
September 30, 1998 unrealized losses in the amount of $7,811 have been included
with revenues on the related statement of operations and a margin balance due on
one of the Company's accounts in the amount of $4,635 has been reported on the
balance sheet as a current liability. During the year ended September 30, 1999
the Company sold or transferred the remaining securities to the shareholders
personal account, which had an impact of increasing shareholder advances, and
closed one of the trading accounts. (Also, see Note 9)

NOTE 4: INVESTMENT IN TENSLEEP TECHNOLOGIES, INC.

In 1997 the Company acquired 1 million investment units of Tensleep
Technologies, Inc. ("Tensleep") common stock. Tensleep is an affiliate
company.
Each investment unit is composed of one share of common stock and one warrant to
purchase one share of common stock at a specified price (see note 7A). Shares
acquired represent approximately an 18% ownership in Tensleep at the time of
purchase. A major shareholder of the Company is also a major shareholder of
Tensleep. Based on the 18% ownership interest in Tensleep, the Company has
decided to account for the investment under the cost method. The shares were
obtained in the cash-free exchange described in Note 6. The valuation of the
shares obtained was an agreed-upon value as of the date of the exchange and will
be carried on the books of the Company at cost.

The Company declared a property dividend (see note 13) in January 1998 and
distributed 378,572 shares of Tensleep common stock to its shareholders leaving
the Company with 621,428 shares of Tensleep common stock representing
approximately an 8% and 10% ownership in Tensleep as of September 30, 1999 and
1998 respectively.

NOTE 5: INVESTMENT IN CAPITAL TECHNOLOGIES, INC.

In 1997 the Company acquired 500,000 shares of common stock and 1,000,000
warrants to purchase one share of common stock at 40 cents per share of Capital
Technologies, Inc. ("Capital") common stock. Shares acquired represent
approximately an 27% ownership in Capital. The Company's investment of 27% of
the common stock of Capital is carried at cost because the Company does not
exercise significant influence over its operating and financial activities. The
shares were obtained in the cash-free exchange described in Note 6. The
valuation of the shares obtained was an agreed-upon value as of the date of the
exchange and will be carried on the books of the Company at cost as of September
30, 1998.

During the year ended September 30, 1998 the Company exercised 228,328
warrants for $91,331 and sold the warrants to unrelated parties for $114,164.
The gain in the amount of $22,833 has been included with realized gain from
trading securities under revenues on the related statement of operations.

During the year ended September 30, 1999 the 500,000 shares of common stock
in Capital became worthless and were written off. The loss in the amount of
$200,000 has been included with other income (expenses) on the related statement
of operations.

NOTE 6: NON CASH TRANSACTIONS

As explained in Note 4, the original investment of 1 million investment
units of Tensleep Technologies, Inc. in 1997 was obtained in exchange for 80,000
shares of common stock. Each unit received is composed of one share of common
stock and one warrant to purchase one share of common stock at a specified price
(see note 7A).

As explained in Note 5, the original investment of 500,000 shares of common
stock and 1,000,000 warrants to purchase one share of common stock at a
specified price (see note 7) of Capital Technologies, Inc. in 1997 was obtained
in exchange for 80,000 shares of common stock.

NOTE 7: CAPITAL FUNDING

The Board of Directors authorized private offerings pursuant to Regulation
S, Section 3(b) and/or 4(2) of the Securities Act of 1933, as amended, and/or
Rule 504 of Regulation D promulgated thereunder. The Board of Directors
authorized a public offering pursuant to Regulation A, an exemption under the
Securities Act of 1933, as amended. These offerings can be composed of common
stock and/or warrants. Such offerings could result in dilution to Company
stockholders prior to each offering. Additionally, dilution could also result
from the exercising of warrants, incentive stock options, and non-incentive
stock options. Stock option plans are described in Note 8. The following
summarizes the various stock and warrant transactions as reported in the
accompanying Statement of Changes in Stockholders' equity (deficit):

Note A -incentive stock option plan. This plan
grants options that can be exercised at a specified price. The Company has
resolved that 250,000 shares of common stock be reserved for this plan. On June
28, 1996 the Company granted the options to purchase 120,000 shares at 50 cents
per share (the same as the then current market price) to the majority and
controlling shareholder. As of the date of this audit report no shares had been
exercised.

NOTE 9: RISKS AND UNCERTAINTIES

A. Going Concern

As discussed in the "Independent Auditors Report", the Company has incurred
a net loss of $68,573 for the year ended September 30, 1999 and has incurred
substantial net losses in the past two years. Realization of a major portion of
the assets in the accompanying balance sheet is dependent upon the Company's
success in its future operations. These factors raise substantial doubt about
the Company's ability to continue as a going concern.

The Company has commenced a plan of strict limits on and control over
costs, expenses, compensation and capital expenditures. The Company believes it
will receive sufficient capital from the exercise of warrants and the repayment
of Notes from related and unrelated parties and the sale of an affiliate common
stock, held by the Company, through a private placement.

B. Other Risks and Uncertainties

The investments in the trading securities are held in two separate
brokerage accounts for the purpose of selling them in the near term. As of
September 30, 1999 one account was closed and the remaining account consisted of
$116 in cash. As of September 30, 1998, the account consists of 4,300 shares of
Torch Energy Royalty Trust, listed on the New York Exchange, symbol "TRU", with
a value of $5.94 per share, 1000 shares Karzco Realty Trust, listed on the New
York Exchange, symbol "KRT", with a value of $16.687 per share, 1000 shares of
Gasonics Intel Corp, listed on the NASDAQ , with a value of $3.54 per share,
9250 shares of Western Oil and Tire Distributors, listed on the New York
Exchange, symbol "WOTD", with a value of $.437 per share, and 5,000 shares
Amtech Systems, Inc. listed on the NASDAQ smallcap, with a value of $27/32 per
share. The aggregate value of the account is $58,738 as of September 30, 1998.
A margin balance of $4,635 is due on one of the Company's brokerage accounts as
of September 30, 1998.

The investment in the trading securities account is subject to the hazards
of trading equities on the open market. The account will experience growth and
loss in varying amounts depending on the performance of the securities traded.
All of the Company's $58,738 interest in the account is at risk and subject to
loss.

NOTE 10: RELATED PARTY TRANSACTIONS

The receivable as of September 30, 1999 in the amount of $140,000 is due
from Tensleep Technologies, Inc., for consulting services performed by Ronald S.
Tucker, the president of the Company. This amount is also reported with
consulting fees in the accompanying statement of operations.

A director of the Company is also a director and major shareholder of
Tensleep Technologies, Inc. and R Tucker & Associates. Transactions between the
Company and these entities above have been described in Notes 1, 4, 11 and 13.

In November 1997 the Company issued 80,000 shares of its common stock to
a related party in exchange for 1,000,000 investment units (See Note 4).

In December 1997 the Company received as a contribution of additional paid
in capital 125,000 shares of Knightsbridge common stock from R. Tucker &
Associates, Inc. The common stock has been recorded at its fair market value of
$7,875, and additional paid in capital has been increased by a corresponding
amount. The Company transferred the Knightsbridge common stock to one of its
brokerage accounts with the intention of selling the stock.

The accrued consulting fee as of September 30, 1999 and 1998 is payable to
Ron Tucker and R. Tucker & Associates, Inc., for consulting services rendered to
the Company. During the year ended September 30, 1998 a $75,000 shareholder
receivable from Ron Tucker was used to reduce accrued consulting fees.

NOTE 11: PURCHASE OF SOFTWARE

On June 1, 1996, the Company acquired a nonexclusive license agreement,
which had an agreed upon value of $200,000 at that time, for the source code of
InFoCen from TextBase Imaging Corp., a related party, now known as R. Tucker and
Associates, Inc. which had an agreed upon value of $200,000 at that time. The
terms of the agreement provided that the Company receive the license agreement
in exchange for 1,360,000 shares of the Company's common stock. The license was
capitalized and amortized over its expected useful life of three years. At
September 30, 1999 after the license was fully amortized the license was removed
from the Company's books and records because it was considered obsolete.

NOTE 12: EARNINGS (LOSS) PER SHARE

As of September 30, 1999 and 1998 The Company had 1,826,600 common shares
outstanding, and no preferred shares outstanding. The earnings (loss) per share
amount is based on the weighted average number of shares actually outstanding
plus the number of shares to be issued in connection with a stock dividend
declared March 31, 2000. The number of shares used in the computation for
September 30, 1999 and 1998 was 3,394,734 and 3,381,401 shares respectively.

NOTE 13: DIVIDENDS

On January 15, 1998 the Board of Directors authorized a dividend to common
stockholders in the form of 378,572 shares of common stock of Tensleep
Technologies, Inc., whose stock is held as an investment. On March 31, 1998
stockholders of record holding 100 or more shares of the Company's common stock
on March 15, 1998 received 1 share of Tensleep Technologies, Inc. common share
for each 5 shares of the Company's stock held. Stockholders with less than 100
shares of the Company's common stock received $.20 per share or fraction of a
share for each 5 shares of the Company's common stock owned. Retained earnings
has been charged in the amount of $189,286, which represents the aggregate
market value of Tensleep Technologies, Inc. shares issued. A gain of $113,571,
which represents the excess of the aggregate market value of Tensleep
Technologies, Inc. shares issued over the aggregate cost of those shares carried
as an investment, under other assets on the accompanying balance sheets, has
been included with other income (expense) in the statements of operations.
Retained earnings has also been charged $28, which represents the cash dividend
paid out for stockholders holding less than 100 shares.

NOTE 14: NAME CHANGE

After the year-end in March 2000 the Board of Directors voted to change the
Company's name from Corporate Finance Company to China Net and Technology, Inc.
The purpose of changing the name was to reflect the 80% equity interest acquired
in Shanghai Yazheng Information Technology Company, Ltd. (SYITC) (See note
15).
The Company acquired this 80% equity interest in SYITC to establish its ability
to acquire interests in or to engage in joint ventures with Chinese Companies.

NOTE 15: INCOME TAXES

For tax purposes, the Company had available, at September 30, 1999 and
1998, net operating loss ("NOL") carry forwards for income tax purposes of
approximately 704,348 and 635,775 respectively, which will expire in various
years from 2016 - 2019. A valuation allowance was provided in full against the
net deferred tax assets resulting from the losses because the utilization of the
NOL is dependent on future taxable profits.

NOTE 16: SUBSEQUENT EVENTS

The following equity transactions have taken place subsequent to September
30, 1999 and through the date of the audit report.

<TABLE>
<CAPTION>
Additional
See Number of Common paid-in
note Date shares Consideration stock capital Total
<S> <C> <C> <C> <C> <C> <C> <C>
Stock Issued 15A 03/31/2000 500,000 Non-cash 5,000 281,667 286,667

Stock Dividend 15B 03/31/2000 1,568,134 Non-cash 15,681 - 15,681

Stock Issued 15C 04/22/2000 2,000,000 Non-cash 20,000 980,000 1,000,000

Stock Issued 15D 04/22/2000 3,000,000 Non-cash 30,000 1,470,000 1,500,000
--------- ------ ---------- -----------
7,068,134 $70,681 $2,731,667 $ 2,802,348

</TABLE>

A 500,000 shares of common stock were issued and reported in the amount of
$286,667 in exchange for outside services valued at $206,667 and 100,000
shares of common stock in Tensleep Technology, Inc. valued at $80,000 or
$0.80 per share, the exercise price on the warrants used to issue the
100,000 shares of common stock in Tensleep Technology, Inc.

B On March 29,2000, the Board of Directors declared a stock dividend payable
on or before April 30, 2000 to stockholders on record on March 31, 2000.
Stockholders holding more than 25,000 shares of the Company's common
stock will receive one additional share for each share owned by them on
March 31, 2000. Stockholders holding more than 25,000 shares of the
Company's common stock will receive one additional share for each share
owned by them on March 31, 2000. Shareholders owning at least 20 shares,
but not more than 25,000 shares will receive $0.05 per share cash
dividend. Shareholders with less than 20 shares will receive nothing.
Per share amounts in the accompanying financial statements have been
adjusted for the split.

C 2,000,000 shares of common stock were issued and reported in the amount of
$1,000,000 in exchange for 400,000 shares of common stock in Tensleep
Technology, Inc. The valuation of the shares obtained was an agreed-upon
value as of the date of the exchange.

D 3,000,000 shares of common stock were issued and reported in the amount of
$1,500,000 in exchange for a 80% equity interest in Shanghai 3 W
Information Technology Company, Ltd., a Chinese limited partnership. The
valuation of the shares obtained was an agreed upon value as of the date
of exchange.

Had the above additional stock issuance taken place on September 30, 1999,
loss per common share would have changed

CORPORATE FINANCE COMPANY

Balance Sheet As Of
March 31, 2000
(unaudited)

ASSETS

Current assets:

Cash $ 732,803
Other Current Assets (See note 1) 71,609
------------
Total Current Assets 804,412

Other Assets:

Deposits 35,000
Investment in Tensleep at cost (See note 2) 15,086
Investment in Hi - Tech Ventures, Ltd. 30,000
License, Technology 200,000
Organizational Expenses, Net 13,005
------------
Total Other Assets 293,091
------------
Total Assets $ 1,097,503
============

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Other Current Liabilities:

License Fee Payable $ 100,000
Accrued Consulting Fees (See note 10) 185,000
------------
Total Other Liabilities 285,000

Stockholders' Equity:

Preferred stock, no stated value, 10,000,000
shares authorized, no shares issued and
outstanding -0-
Common stock, $0.01 stated value, 20,000,000
shares authorized, 389,4734 shares
issued and outstanding 38,947
Additional paid-in capital 1,113,595
Retained earnings ( 704,349)
Net Income For Period 364,310
-------------
Total Stockholders Equity 812,503
------------
Total Liabilities & Stockholders' Equity $ 1,097,503
============

The accompanying notes are an integral part of these statements.

CORPORATE FINANCE COMPANY

Statement of Operations
October 1, 1998 to March 31, 1999
(unaudited)

Revenues
Consulting Fees $ 45,824
Interest Income 2,565
Realized Gain from Trading Securities 557,846
--------------
Net Operating Income 606,235

Operating Expenses:

Operating Expenses 241,925
--------------
Net Operating Income $ 364,310
--------------
Income Taxes -0-
--------------
Net Income After Taxes 364,310
--------------

Accumulated Deficit - Beginning of Year (704,348)
--------------

Accumulated Deficit - End of Period $ 340,038
==============
Earnings Per Common Share (Note 14) $ 0.09
==============

The accompanying notes are an integral part of these statements.

CORPORATE FINANCE COMPANY

Statement of Stockholders' Equity
October 1, 1999 to March 31, 2000
(unaudited)

Additional
See Number of Common paid-in Accumulated
note Date shares Consideration stock capital Deficit Total

Balance, October 1, 1999 1,826,600 $18,266 $847,609 $(704,348) $ 161,527

Stock Issued 7A 03/31/2000 500,000 Non-cash 5,000 281,667 - 286,667

Stock Dividend 15B 03/31/2000 1,568,134 Non-cash 15,681 (15,681) - -

Net Profit 364,310 364,310
========= ======= ========= ========== =========
Balance, September 30, 2000 3,894,734 $38,947 $1,113,595 $ 340,036 $ 812,504
========= ======= ========== ========== =========
</TABLE>

The accompanying notes are an integral part of these statements.

CORPORATE FINANCE COMPANY

Statement of Cash Flows
For the Six Months
October 1, 1999 to March 31, 2000
(Unaudited)

2000

CASH FLOW FROM OPERATING ACTIVITIES
Net Profit $ 364,310

Adjustments to reconcile net loss to net
cash used in operations:
Depreciation and amortization 4,335
(Increase) decrease in assets:
Accounts receivable 129,800
Investment in Tensleep 109,200
Technology License (200,000)
Deposits (35,000)
Increase (decrease) in liabilities:
Accrued License Fee 100,000
------------
Net cash used by operating activities 472,645
------------
CASH FLOWS FROM INVESTING ACTIVITIES

Investment In Tensleep ( 30,000)
-----------
Net cash used by investing activities ( 30,000)
-----------
CASH FLOWS FROM FINANCING ACTIVITIES
Shareholder loan (paid off) 14,456
Shareholders Advance (11,312)
Shares issued for services 286,667
------------
Net cash provided by financing activities 289,811
------------
NET INCREASE (DECREASE) IN CASH 732,456

CASH, beginning of period 347
-----------
CASH, end of year $ 732,803
===========

The accompanying notes are an integral part of these statements.

CORPORATE FINANCE COMPANY

NOTES TO FINANCIAL STATEMENTS

March 31, 1998

(Unaudited)

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

Corporate Finance Company (The Company) (A Colorado Corporation) is a
specialty finance company and holding corporation, offering temporary
management resources and financial assistance to development stage and start
up companies in the technology or technology related sector. The Company was
incorporated in June 1996 as NatureNu Corporation. In September 1996 the
Board of Directors voted to change the Company's name from NatureNu
Corporation to Corporate Finance Company. The Company's business strategy
does not incorporate venture capital funding nor investing long term in
venture capital type companies, but involves a program of project assistance
for an agreed period. On completion of a project assistance program, the
Company is entitled to recoup its financial investment or loans (if any) and
to be paid management fees for its assistance. In certain instances, the
Company may agree to acquire or to incorporate a target company as a
investment of the Company, but the holding period for such companies is
intended to be temporary, not indefinite.

Cash and Cash Equivalents

For the purpose of financial statement reporting, the Company considers
all highly liquid investments with maturity of 3 months or less to be cash
equivalents.

Concentration of Credit Risk

Property and Equipment, Depreciation and Amortization

Depreciation and amortization are computed using the straight-line
method over the assets' expected useful lives. The useful lives of property
and equipment for purposes of computing depreciation and amortization are:

Machinery & Equipment 3 years
Software 3 years
Organization Expenses 5 years

Repairs and maintenance are charged to operations when incurred. Costs
of betterments, which materially extend the useful lives of the assets, are
capitalized. Gains and losses from sales or disposition of assets are
included in the statement of operation.

Trading Securities

Fair Value of Financial Instruments

For the Company's financial instruments, the carrying value is considered
to approximate the fair value. Cash and accounts payable are settled so close
to the balance sheet date that fair value does not differ significantly from
the stated amounts.

Adjustments

In the opinion of management the data reflects all adjustments necessary
for a fair statement of results for this period. All adjustments are of a
normal and recurring nature.

NOTE 1: SHAREHOLDER ADVANCES

In connection with normal operations the shareholder advances funds to,
and receives funds from the Company. The Company has shareholder advance
receivables of $61,409 as of March 31, 2000. The advances to and from the
shareholder do not bear interest and also have no specific repayment terms.

NOTE 2: INVESTMENT IN TENSLEEP TECHNOLOGIES, INC.

In 1997 the Company acquired 1 million investment units of Tensleep
Technologies, Inc. ("Tensleep") common stock. Tensleep is an affiliate
company.
Each investment unit is composed of one share of common stock and one warrant
to purchase one share of common stock at a specified price (see note 4A).
Shares acquired represent approximately an 18% ownership in Tensleep at the
time of purchase. A major shareholder of the Company is also a major
shareholder of Tensleep. Based on the 18% ownership interest in Tensleep, the
Company has decided to account for the investment under the cost method. The
shares were obtained in the cash-free exchange described in Note 3. The
valuation of the shares obtained was an agreed-upon value as of the date of the
exchange and will be carried on the books of the Company at cost.

The Company declared a property dividend (see note 10) in January 1998
and distributed 378,572 shares of Tensleep common stock to its shareholders
leaving the Company with 621,428 shares of Tensleep common stock representing
approximately an 8% and 10% ownership in Tensleep as of September 30, 1999 and
1998 respectively.

NOTE 3: NON CASH TRANSACTIONS

As explained in Note 2, the original investment of 1 million investment
units of Tensleep Technologies, Inc. in 1997 was obtained in exchange for
80,000 shares of common stock. Each unit received is composed of one share of
common stock and one warrant to purchase one share of common stock at a
specified price (see note 4A).

NOTE 4: CAPITAL FUNDING

The Board of Directors authorized private offerings pursuant to
Regulation S, Section 3(b) and/or 4(2) of the Securities Act of 1933, as
amended, and/or Rule 504 of Regulation D promulgated thereunder. The Board of
Directors authorized a public offering pursuant to Regulation A, an exemption
under the Securities Act of 1933, as amended. These offerings can be composed
of common stock and/or warrants. Such offerings could result in dilution to
Company stockholders prior to each offering. Additionally, dilution could also
result from the exercising of warrants, incentive stock options, and non-
incentive stock options. Stock option plans are described in Note 8. The
following summarizes the various stock and warrant transactions as reported in
the accompanying Statement of Changes in Stockholders' equity (deficit):

NOTE 6: RISKS AND UNCERTAINTIES

A. Going Concern

As discussed in the "Independent Auditors Report", the Company has
incurred a net loss of $68,573 for the year ended September 30, 1999 and has
incurred substantial net losses in the past two years. Realization of a major
portion of the assets in the accompanying balance sheet is dependent upon the
Company's success in its future operations. These factors raise substantial
doubt about the Company's ability to continue as a going concern.

B. Other Risks and Uncertainties

The investment in the trading securities account is subject to the
hazards of trading equities on the open market. The account will experience
growth and loss in varying amounts depending on the performance of the
securities traded. All of the Company's $58,738 interest in the account is at
risk and subject to loss.

NOTE 7: RELATED PARTY TRANSACTIONS

The receivable as of September 30, 1999 in the amount of $140,000 is due
from Tensleep Technologies, Inc., for consulting services performed by Ronald
S. Tucker, the president of the Company. This amount is also reported with
consulting fees in the accompanying statement of operations.

In November 1997 the Company issued 80,000 shares of its common stock to
a related party in exchange for 1,000,000 investment units (See Note 2).

In December 1997 the Company received as a contribution of additional
paid in capital 125,000 shares of Knightsbridge common stock from R. Tucker &
Associates, Inc. The common stock has been recorded at its fair market value
of $7,875, and additional paid in capital has been increased by a corresponding
amount. The Company transferred the Knightsbridge common stock to one of its
brokerage accounts with the intention of selling the stock.

The accrued consulting fee as of September 30, 1999 and 1998 is payable
to Ron Tucker and R. Tucker & Associates, Inc., for consulting services
rendered to the Company. During the year ended September 30, 1998 a $75,000
shareholder receivable from Ron Tucker was used to reduce accrued consulting
fees.

NOTE 8: PURCHASE OF SOFTWARE

On June 1, 1996, the Company acquired a nonexclusive license agreement,
which had an agreed upon value of $200,000 at that time, for the source code of
InFoCen from TextBase Imaging Corp., a related party, now known as R. Tucker
and Associates, Inc. which had an agreed upon value of $200,000 at that time.
The terms of the agreement provided that the Company receive the license
agreement in exchange for 1,360,000 shares of the Company's common stock. The
license was capitalized and amortized over its expected useful life of three
years. At September 30, 1999 after the license was fully amortized the license
was removed from the Company's books and records because it was considered
obsolete.

NOTE 9: EARNINGS (LOSS) PER SHARE

As of September 30, 1999 the Company had 1,826,600 common shares
outstanding, and no preferred shares outstanding. The earnings (loss) per share
amount is based on the weighted average number of shares actually outstanding
plus the number of shares to be issued in connection with a stock dividend
declared March 31, 2000. The number of shares used in the computation for
March 31, 2000 was 3,394,734 and 3,381,401 shares respectively.

NOTE 10: DIVIDENDS

On January 15, 1998 the Board of Directors authorized a dividend to
common stockholders in the form of 378,572 shares of common stock of Tensleep
Technologies, Inc., whose stock is held as an investment. On March 31, 1998
stockholders of record holding 100 or more shares of the Company's common stock
on March 15, 1998 received 1 share of Tensleep Technologies, Inc. common share
for each 5 shares of the Company's stock held. Stockholders with less than 100
shares of the Company's common stock received $.20 per share or fraction of a
share for each 5 shares of the Company's common stock owned. Retained earnings
has been charged in the amount of $189,286, which represents the aggregate
market value of Tensleep Technologies, Inc. shares issued. A gain of
$113,571, which represents the excess of the aggregate market value of Tensleep
Technologies, Inc. shares issued over the aggregate cost of those shares
carried as an investment, under other assets on the accompanying balance
sheets, has been included with other income (expense) in the statements of
operations. Retained earnings has also been charged $28, which represents the
cash dividend paid out for stockholders holding less than 100 shares.

NOTE 11: NAME CHANGE

After the year-end in March 2000 the Board of Directors voted to change
the Company's name from Corporate Finance Company to China Net and Technology,
Inc. The purpose of changing the name was to reflect the 80% equity interest
acquired in Shanghai Yazheng Information Technology Company, Ltd. (SYITC) (See
note 15). The Company acquired this 80% equity interest in SYITC to establish
its ability to acquire interests in or to engage in joint ventures with Chinese
Companies.

NOTE 12: INCOME TAXES

NOTE 13: SUBSEQUENT EVENTS

The following equity transactions have taken place subsequent to
September 30, 1999 and through the date of the audit report.

<TABLE>
<CAPTION> Additional
See Number of Common paid-in
note Date shares Consideration stock capital Total
<S> <C> <C> <C> <C> <C> <C> <C>
Stock Issued 15A 04/22/2000 2,000,000 Non-cash 20,000 980,000 1,000,000

Stock Issued 15B 04/22/2000 3,000,000 Non-cash 30,000 1,470,000 1,500,000
--------- ------ ---------- -----------
5,000,000 $50,000 $2,450,000 $ 2,500,000

</TABLE>

A 2,000,000 shares of common stock were issued and reported in the amount
of $1,000,000 in exchange for 400,000 shares of common stock in Tensleep
Technology, Inc. The valuation of the shares obtained was an agreed-upon
value as of the date of the exchange.

B 3,000,000 shares of common stock were issued and reported in the amount
of $1,500,000 in exchange for a 80% equity interest in Shanghai 3 W
Information Technology Company, Ltd., a Chinese limited partnership. The
valuation of the shares obtained was an agreed upon value as of the date
of exchange.

Had the above additional stock issuance taken place on September 30,
1999, profit per common share would have changed