UNITED STATESSECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549


FORM 10-QSB


`(Mark One)`

`[X]            Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
                        For the quarterly period ended June 30, 2001`

`[  ]            TRANSITION report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
                        For the transition period from ______ to ______`

Commission file number 0-27145


1st NET TECHNOLOGIES, INC. (Name of small business issuer in its charter)

Colorado
      
      33-0756798(State
          or jurisdiction of incorporation or organization)
      
      (I.R.S. Employer Identification No.)


11415 West Bernardo Court, 2nd Floor San Diego, California 92127(Address of principal executive offices)(858) 675-4449(Issuer's telephone number)


``

Indicate by check mark
  whether the registrant (1) has filed all reports required to be filed by Section
  13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
  (or for such shorter period that the registrant was required to file such reports),
  and (2) has been subject to such filing requirements for the past 90 days. 
  Yes [X] No [  ]

``

`As of August 9, 2001, there were 6,945,892 shares of the Registrant's common stock outstanding.`

---

### TABLE OF CONTENTS

PART
          I-FINANCIAL INFORMATIONItem
          1.
      Financial Statements............................................................................Condensed Consolidated
          Balance Sheets June 30, 2001(unaudited)...................
      F-1Condensed Consolidated
          Statements of Operations June 30, 2001 (unaudited)
      F-2Condensed Consolidated
          Statements of Cash Flows  Three Months Ended June 30, 2001 and June
          30, 2001 (unaudited)............................................................
      F-3Notes to Condensed
          Consolidated Financial Statements.....................................
      F-4Item
          2.
      Management's Discussion
          and Analysis of Financial Condition and Results of Operations......................................................................................
      F-6PART
          IIOTHER INFORMATIONItem
          1.
      Legal
          Proceedings...............................................................................
      Part
          II-1Item
          2.
      Changes
          in Securities...........................................................................
      Part
          II-1Item
          3.
      Defaults
          Upon Senior Securities...........................................................
      Part
          II-1Item
          4.
      Submission
          of Matters to a Vote of Security Holders............................
      Part
          II-1Item
          5.
      Other
          Information................................................................................
      Part
          II-1Item
          6.
      Exhibits
          and Reports on Form 8-K......................................................
      Part
          II-1Signatures...............................................................................................................
      Part
          II-2


---

PART I - FINANCIAL INFORMATION


`ITEM 1.  FINANCIAL STATEMENTS`

|1st
        NET TECHNOLOGIES, INC. AND SUBSIDIARY
|-------------------------------------------------
|and
        Subsidiaries                         
|CONDENSED
        CONSOLIDATED BALANCE SHEET     
|UNAUDITED                                        
|                                                 
|June
        30, 2001                            
|                                                 
|ASSETS                                           
|                                                 
|Current assets:                                  
|                                                 
|                                                 
|                                                 
|                                                 
|                                                 
|                                                 
|                                                 
|Notes receivable                                 
|                                                 
|Property and equipment,
        net              
|                                                 
|Other assets                                     
|                                                 
|                                                 

|                                                       |                                                         
|------------------------------------------------------ | --------------------------------------------------------
|LIABILITIES AND
        STOCKHOLDERS' EQUITY           |                                                         
|                                                       |                                                         
|Current liabilities:                                   |                                                         
|                                                       | Accounts payable
        and accrued liabilities        
|                                                       | Notes payable                                           
|                                                       | Notes payable and
        amounts due to related parties
|                                                       | Current portion of
        capital lease obligations    
|                                                       | Accrued personnel
        costs                         
|                                                       | Deferred revenues                                       
|                                                       | Income taxes payable                                    
|                                                       |                                                         
|                                                       | Total current liabilities                               
|                                                       |                                                         
|Long term portion
        of capital lease obligations | 113,210                                                 
|Deferred credits
        from acquisition of CTG,      |                                                         
|                                                       | net of accumulated
        amortization of $ and $29,504
|                                                       |                                                         
|                                                       | Total liabilities                                       
|                                                       |                                                         
|Commitments and contingencies                          | -                                                       
|                                                       |                                                         
|Stockholders' equity
        (Note 3):                 |                                                         
|                                                       | Preferred stock                                         
|                                                       | Common stock                                            
|                                                       | Common stock warrants                                   
|                                                       | Additional paid in
        capital                      
|                                                       | Accumulated deficit                                     
|                                                       | Accumulated other
        comprehensive income          
|                                                       |                                                         
|                                                       | Total stockholders'
        equity                      
|                                                       |                                                         
|                                                       |                                                         
|                                                       |                                                         
|See accompanying
        notes.                        |                                                         

F-2

---



1st NET TECHNOLOGIES, INC. AND SUBSIDIARYand SubsidiariesCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONSUNAUDITEDFor the Three Months Ended
      
      For the Six Months EndedJune 30,
      
      June 30,2001
      
      2000
      
      2001
      
      2000Restated *
      
      
      
      Restated *Revenues:Technology consulting, user fees andTotal revenues
      247,099
      
      1,760,113
      
      247,099
      
      1,760,113marketing services
      $             
          33,920
      
      $             
          25,444
      
      $             
          37,036
      
      $             
          73,103Stock-based compensation
      -
      
      -
      
      6,775
      
      -Other operating expenses
      91,244
      
      341,840
      
      235,251
      
      1,373,105Loss from operations
      (57,324)
      
      (316,396)
      
      (204,990)
      
      (1,300,002)Other income and expense:Realized gain/(loss) on investments sold
      (20,812)
      
      441,264
      
      (5,980)
      
      1,154,822Unrealized loss on investments held
      -
      
      -
      
      (64,961)
      
      (40,000)Loss on write-down of investments
      (794,152)
      
      -
      
      (794,152)
      
      -Interest expense
      (10,587)
      
      (3,892)
      
      (18,782)
      
      (51,607)Gain on sale of assets
      -
      
      -
      
      -
      
      535,255Loss on disposal of property and equipment
      -
      
      
      
      -Loss on disposal of property and equipment
      -
      
      -
      
      -
      
      (9,390)Interest and dividend income
      -
      
      21,272
      
      130
      
      29,737Loss before provision for income taxes
      (882,875)
      
      142,248
      
      (1,088,735)
      
      318,815Provision for income taxes
      -
      
      (5,102)
      
      -
      
      (5,102)Net loss
      
      $          (882,875)
      
      $            137,146
      
      $       (1,088,735)
      
      $            313,713Basic and diluted loss per share
      $               
          (0.13)
      
      $                 
          0.02
      
      $               
          (0.16)
      
      $                 
          0.05Weighted average common shares outstanding:Basic and diluted
      6,873,631
      
      6,003,700
      
      6,738,779
      
      5,943,260*   See Note 1See accompanying notes.


F-2

---

1st NET TECHNOLOGIES, INC. AND SUBSIDIARYCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWSUNAUDITEDFor
          the Six Months EndedJune
          30,2001
      
      2000Restated
          *Net cash flows
          used in operating activities
      
      $          
          (715,042)
      
      $           
          525,477Investing activitiesAdditions to property
          and equipment
      
      (24,250)
      
      (25,517)Proceeds from payment
          of notes receivable
      
      100,000
      
      -Net cash flows
          provided by investing activities
      
      75,750
      
      (25,517)Financing activitiesRepayments of capital
          lease obligations
      
      (12,362)
      
      (37,029)Additions to notes
          payable
      
      35,000
      
      -Repayments of notes
          payable
      
      (22,750)
      
      (268,516)Net proceeds from
          issuance of common stock
      
      94,506
      
      -Net proceeds from
          issuance of preferred stock and warrants
      
      -
      
      -Net cash flows
          provided by financing activities
      
      94,394
      
      (305,545)Change in cash
      
      (544,898)
      
      194,415Cash at beginning
          of period
      
      553,388
      
      12,873Cash at end of
          period
      
      $                
          8,490
      
      $            
          207,288Supplemental disclosures
          of cash flow information:Cash paid during
          the period for:Interest
      
      $      
                    2,100
      
      $              
          51,082Income taxes
      
      $                        
          -
      
      $                        
          -*   See
          Note 1 F-4   1st NET TECHNOLOGIES,
    INC. AND SUBSIDIARYNotes to Condensed
    Consolidated Financial Statements
    (Unaudited) Note 1:  Basis of presentation


The financial statements presented
  herein have been prepared by the Company in accordance with the accounting policies
  in its annual 10-KSB report dated December 31, 2000 and should be read in conjunction
  with the notes thereto.

The accompanying condensed consolidated
  financial statements include the accounts of the Company and its wholly owned
  subsidiary, SSP Management Corp. (SSP).  Intercompany transactions and
  balance were eliminated in consolidation.

Prior to the quarter to which this
  quarterly report relates, the Company accounted for its investment in Childrens
  Technology Group, Inc. (CTG) in accordance with Accounting Principle Board
  (APB) Opinion No. 16.  Under this method, the Company consolidated CTGs
  financial statements with its own.  During the quarter ended June 30, 2001,
  CTG issued additional shares of its common stock to the public resulting in
  a change in the Companys ownership.  Because of the change in ownership,
  the Company no longer has a controlling interest in CTG.  In addition,
  the Company no longer has any influence over the affairs of CTG.  Accordingly,
  as of June 30, 2001, the Company accounts for its ownership of 3,992,614 shares
  of CTGs common stock at cost.  The investment in CTG common stock was
  written down to $-0-, resulting in a loss of $794,152 for the three and six
  months ended June 30, 2001.

In accordance with APB No. 20, the
  financial statements have been restated to show financial information for the
  new reporting entity for all periods presented.

In the opinion of management, all
  adjustments (consisting only of normal recurring adjustments) which are necessary
  to provide a fair presentation of operating results for the interim period presented
  have been made.  The results of operations for the three and six months
  ended June 30, 2001 are not necessarily indicative of the results to be expected
  for the year.

The accompanying financial statements
  have been prepared on a going concern basis, which contemplates the realization
  of assets and the satisfaction of liabilities in the normal course of business. 
  As shown in the accompanying financial statements, the Company has a net capital
  deficit at June 30, 2001 and a loss of $5,681,101 since inception.

The financial statements do not include
  any adjustments relating to the recoverability and classification of liabilities
  that might be necessary should the Company be unable to continue as a going
  concern.  Realization of a portion of the Companys assets in the accompanying
  condensed consolidated financial statements is dependent upon the continued
  operation of the Company.  In order to continue operations, the Company
  must raise additional funds by incurring new debt, raising new equity, or liquidating
  investment securities held. These factors, among others, may indicate that the
  Company will be unable to continue as a going concern.  Management believes
  the actions presently being taken and current revenues being generated will
  provide the opportunity for the Company to continue as a going concern.

Interim financial data presented herein
  are unaudited.

Note 2: Related party transactions

On February 16, 2001, APJW, Inc.,
  an affiliate company, loaned the Company $25,000 in exchange for a promissory
  note.  The promissory note carries an interest rate of one percent per
  month and matures on demand.  The Company repaid $15,000 of the note on
  June 6, 2001.  The sole shareholder of APJW, Inc. is the Companys Chief
  Executive Officer.

On April 20, 2001, the affiliate loaned
  the Company $10,000 in exchange for a promissory note.  The promissory
  note carries an interest rate of one percent per month and matures on demand.

The Company paid $1,500 of interest
  expense on the two notes on June 6, 2001.

Note 3:  Common stock

Warrants

On January 10, 2001, the Company granted
  warrants to purchase 525,000 shares of common stock at $3.00 per share to four
  related parties as follows:

Related Party
      
      WarrantsEntrepreneur Investments, LLC
      
      300,000Jeffery M. Chatfield
      
      25,000Gregory D. Writer, Jr.
      
      100,000Clifford J. Smith
      
      100,000525,000 These warrants were issued in satisfaction of a stock option agreement
    with each of the respective parties, which was agreed to in January 1999;
    however, executed copies of the stock option agreement were not subsequently
    delivered to the parties.  The stock option agreement with each of the
    parties was rescinded in exchange for the warrants.  The warrants vested
    as of the grant date and expire on January 10, 2004.


On June 30, 2001, the Company issued
  25,000 shares of its common stock in exchange for the rescission of warrants
  granted to purchase 100,000 shares of the Companys common stock.

Following is a schedule of changes
  in the Companys outstanding warrants for the six months ended June 30, 2001:

WarrantsBalance, January 1, 2001.................................................
      275,572Granted............................................................................
      525,000Exercised.........................................................................
      -Cancelled............................................................................
      (100,000)Balance, June 30, 2001.................................................
      700,572 Stock-based compensation


The Company recorded stock-based compensation
  totaling $525 for the 525,000 warrants granted on January 10, 2001.  The
  Company has accounted for the warrants under the fair value method in accordance
  with Statement of Financial Accounting Standard No. 123.  The fair value
  for these warrants was estimated at the grant date using the Black-Scholes option-pricing
  model with the following assumptions:

Risk-free interest rate...........................
      5.80%Dividend yield......................................
      0.00%Volatility factor.....................................
      50.00%Weighted average expected life............
      3 years The Black-Scholes options valuation model was developed for use in estimating
    the fair value of traded options, which have no vesting restrictions and are
    fully transferable.  In addition, option valuation models require the
    input of highly subjective assumptions including the expected stock price
    volatility.  Because the Companys stock options have characteristics
    significantly different from those of traded options, and because changes
    in the subjective input assumptions can materially affect the fair value estimate,
    in managements opinion, the existing models do not necessarily provide a
    reliable single measure of the fair value of its stock options.  However,
    the Company has presented the pro forma net loss and pro forma basic and diluted
    loss per common share using the assumptions noted above.


Common stock

On February 21, 2001, the Company
  sold 100,000 shares of its common stock to an unrelated third party for $25,000
  ($.25/share).

On March 12, 2001, the Company sold
  20,000 shares of its common stock to an unrelated third party for $5,000 ($.25/share).

On March 19, 2001, the Company sold
  40,000 shares of its common stock to an unrelated third party for $10,000 ($.25/share).

On March 31, 2001, the Company issued
  25,000 shares of its common stock to an employee in accordance with the terms
  of an employment agreement.  The fair value of the common stock on the
  transaction date was determined as $.25 per share based on contemporaneous stock
  sales.  Stock-based compensation of $6,250 was recognized in the accompanying
  condensed consolidated financial statements for the six months ended June 30,
  2001.

On April 5, 2001, the Company sold
  60,000 shares of its common stock to an unrelated third party for $15,000 ($.25/share).

On April 10, 2001, the Company sold
  20,000 shares of its common stock to an unrelated third party for $5,000 ($.25/share).

On April 16, 2001, the Company sold
  20,000 shares of its common stock to an unrelated third party for $5,000 ($.25/share).

On April 26, 2001, the Company sold
  40,000 shares of its common stock to an unrelated third party for $10,000 ($.25/share).

On May 8, 2001, the Company sold 20,000
  shares of its common stock to an unrelated third party for $5,000 ($.25/share).

On May 22, 2001, the Company sold
  20,000 shares of its common stock to an unrelated third party for $5,000 ($.25/share).

On June 28, 2001, entered
  into an agreement with CTG whereby the Company agreed to sell 250,000 shares
  of CTG common stock back to CTG for $25,000.

Following is a schedule of changes in shareholders deficit for the six
  months ended June 30, 2001:

Accumulated Other Comprehensive  Income/(Loss)Additional Paid-in Capital
      Accumulated Deficit
      TotalCommon Stock
      Common Stock WarrantsShares
      Par ValueBalance, January 1, 2001
      6,555,892
      $6,556
      $275,272
      $8,422,179
      ($8,705,764)
      $11,285
      $9,528Warrants issued in satisfactionof stock option agreement
      -
      -
      525
      -
      -
      -
      525Shares sold to unrelated thirdparties at $.25 per share
      340,000
      340
      -
      84,660
      -
      -
      85,000Shares issued in exchange forservices in accordance withemployment agreement
      25,000
      25
      -
      6,225
      
      
      6,250Shares issued in exchange forrescission of warrants
      25,000
      25
      (100,000)
      99,975
      -
      -
      -Removal of CTG balancesfrom previously consolidatedfigures.
      -
      -
      -
      (3,206,871)
      4,113,398
      -
      906,527Comprehensive loss:Net loss..
      
      
      
      
      (1,088,735)
      -
      (1,088,735)Unrealized loss on investmentsheld for sale, net of realizedgains and losses.
      -
      -
      -
      -
      -
      (195,255)
      (195,255)Balance, June 30, 2001
      6,945,892
      $6,946
      $175,797
      $5,406,168
      ($5,681,101)
      (183,970)
      (276,160)




Note 6:  Income taxes

The Company records its income taxes
  in accordance with SFAS No. 109, Accounting for Income Taxes.  The Company
  incurred net operating losses during the six months ended June 30, 2001, resulting
  in a deferred tax asset, which was fully allowed for; therefore, the net benefit
  and expense result in $-0- income taxes.

---

ITEM 2: MANAGEMENT'S DISCUSSION
  AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The
  following discussion should be read in conjunction with the consolidated financial
  statements and notes thereto.  In addition to historical information, this
  Quarterly Report on Form 10-QSB contains forward-looking statements that involve
  risks and uncertainties that could cause actual results to differ materially. 
  Factors that might cause or contribute to such differences include, but are
  not limited to, those discussed in the section entitled "Risks and Uncertainties."
   You should carefully review the risks described in other documents we
  file rom time to time with the Securities and Exchange Commission, including
  future Quarterly Reports on Form 10-QSB to be filed in 2001.  When used
  in this report, the words "expects," "anticipates," "intends," "plans," "believes,"
  "seeks," "targets," "estimates," and similar expressions are generally intended
  to identify forward-looking statements.  You should not place undue reliance
  on these forward-looking statements, which speak only as of the date of this
  Quarterly Report on Form 10-QSB. We undertake no obligation to publicly release
  any revisions to the forward-looking statements or reflect events or circumstances
  after the date of this document.

`OVERVIEW`

1stNet
  Technologies, Inc. (the "Company" or "1stNet")
  derives its revenue from services provided to the Internet and multi-media industries. 
  Many of 1st Net's services are billed on an hourly rate based upon a project
  specification document developed in association with the client.  Fees
  for other services vary, based on the type of service and client.

The
  Company maintains two subsidiary corporations:

1.     
  SSP Management Corp.: In January 1999, we acquired a 100% interest in
  SSP Management Corp., a Colorado corporation, from a private company that is
  considered a related party.

2.     
  Children's Technology Group, Inc.: In May 1999, we acquired a controlling
  interest in Children's Technology Group, Inc. ("CTG") (formerly Tummy Busters,
  Inc.), a Nevada corporation.  The business model of CTG is to build a safe
  and enjoyable Internet community for children on-line.

Our
  historical financial information contained in this Quarterly Report on Form
  10-QSB is that of 1stNet
  Technologies, Inc. and its subsidiary corporations on a consolidated basis.



RESULTS OF OPERATIONS - SECOND QUARTER
  OF 2001 COMPARED TO SECOND QUARTER OF 2000

Revenues

The
  Company's revenues from technology consulting, user fees and marketing services
  during the second quarter of 2001 increased $8,476 to $33,920, or 25% from the
  same quarter during the prior year.  The increase in revenues was a result
  of increased sales of the Company's EnvoyMail product and eMarketing services.

Operating Gain/Loss

Loss
  from operations was reduced Qtr. over Qtr. from ($316,396) in 2000 to ($57,324)
  in 2001. Our Net Loss for the quarter rose to ($882,875) from a gain of $137,146,
  or 644% from the same quarter during the prior year. This was a direct result
  of our write down to $0 of the CTG asset.

Other income and expense

The
  Company expects to recognize additional gains from the sale of certain assets
  conducted in 2000 as the proceeds are received on the notes receivable from
  the respective buyers.  The Company has chosen to recognize the gain on
  sale of the newsletter(s) in accordance with the installment method due to the
  uncertainties involved with the receipt of future payments from the buyer(s).



LIQUIDITY AND CAPITAL RESOURCES

As
  of June 30, 2001 the Company had $111,598 in total current assets and total
  shareholders equity of ($276,160) with which to pay its obligations. During
  this reporting period, the Company had been involved in a best efforts financing
  in order to increase the Company's liquidity and capital resources, however,
  management has make a decision to suspend the offering at this time. The Company
  may elect to resume this offering at some point in the future.

In
  the past, our greatest need for cash is payment of salaries and benefits to
  our employees and fees to our outside consultants. Through June 30, 2001, we
  expended significant effort and committed substantial resources toward our continued
  development of the EnvoyMail product.  Management is uncertain, at this
  time, whether that these investments, and the resulting EnvoyMail product, will
  ever provide revenue sufficient to maintain/sustain its operations.

At
  June 30, 2001, the Company had cash on hand in the amount of $8,490.00

On
  a going forward basis, 1stNet
  and its wholly owned subsidiary SSP continue to maintain several holdings of
  restricted and marketable securities.  However, it is impossible to ascertain
  the actual value that will be eventually realized by the Company when these
  securities are sold.

Management
  is uncertain whether the current private offering of restricted stock, plus
  proceeds from the sale of investments held, in addition to cash payments to
  be received from the transactions described above, will be sufficient to make
  up projected shortfalls from the results of its operations through the next
  three months.



RISKS AND UNCERTAINTIES

The
  risks and uncertainties described below are those that we currently deem to
  be material and that we believe are specific to our company and our industry. 
  If any of these or other risks actually occurs, the trading price of our common
  stock could decline further, and you may lose all or part of your investment. 
  We have a history of losses and, absent the realized gains on securities held
  and sold and the sale of assets during the year 2000 and the first two quarters
  of 2001, we would have suffered a significantly greater operating loss than
  the ($204,990) we have incurred year to date.  And, even though we expect
  our operating expenses to decrease in the future, we may never be profitable. 
  We had an accumulated deficit of ($5,865,071) at June 30, 2001.  Unless
  we are able to see a significant increase in revenues from our EnvoyMail product
  during the next quarter, we may well be forced to suspend current operations
  and the future development of the EnvoyMail product.

You
  should consider an investment in our stock in light of the risks, uncertainties
  and difficulties frequently encountered by early-stage companies in new and
  rapidly evolving markets such as ours.  We may not be able to successfully
  address any or all of these risks.  Failure to adequately do so could cause
  our business, results of operations and financial condition to suffer. 
  Our future financial performance also will depend, in part, on our ability to
  diversify our offerings by successfully developing, introducing and gaining
  customer acceptance of new products and enhanced versions of existing products. 
  However, we cannot assure you that we will be successful in achieving market
  acceptance of any new products that we develop or of enhanced versions of existing
  products.  Any failure or delay in diversifying our existing offerings
  could harm our business, results of operations and financial condition.

We
  currently sell our products both indirectly and directly.  At present we
  primarily market 1stNet's
  EnvoyMail product through an internal sales force.  Due to the new nature
  of the product, its market potential is uncertain.  Also, if we are not
  able to attract and retain effective sales personnel, our prospects for realizing
  profits from the licensing of EnvoyMail will be diminished.

In
  the future, we may seek to license additional technology or content in order
  to enhance our current features or to introduce new services, such as certain
  of the community features we may introduce. There can be no assurance that any
  such licenses will be available on commercially reasonable terms, if at all. 
  The loss of or inability to obtain or maintain any of these technology licenses
  could result in delays in introduction of new services until equivalent technology,
  if available, is identified, licensed and integrated, which could have a material
  adverse effect on our business, results of operations and financial condition.



---

PART II: OTHER INFORMATION



ITEM 1. LEGAL PROCEEDINGS



We have initiated litigation against Millennium Financial Publishing, LLC ("MFP")
  in Littleton, Colorado based on the failure MFP to make payments on certain
  promissory notes held by of SSP Management Corp in connection with the sale
  of various assets of SSP to MFP.  Although management believes that we
  have a valid and enforceable claim, we cannot be certain about the ultimate
  resolution of the case.

ITEM 2. CHANGES IN SECURITIES AND
  USE OF PROCEEDS

(a)    During the quarter
  ended June 30, 2001, the Company sold a total of 180,000 shares of its common
  stock at $0.25 per share in five separate private transactions.  All of
  the shares issued were restricted securities.

(b)  
  Not applicable.

(c)   
  Not applicable.

(d)  
  Not applicable.

ITEM
  3. DEFAULTS UPON SENIOR SECURITIES

No events occurred during the quarter
  covered by this Quarterly Report that would require response to this item.

ITEM
  4.  OF MATTERS TO A VOTE OF SECURITY HOLDERS

No
  matters were submitted to a vote of security holders during the three months
  ended June 30, 2001

ITEM
  5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS AND REPORTS ON
  FORM 8-K

(a) Exhibits

None.

(b) Reports on Form 8-K

None.



---

SIGNATURE

Pursuant
  to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
  1934, the Registrant has duly caused this Report to be signed on its behalf
  by the undersigned thereunder duly authorized.



|                       |  | 1st NET TECHNOLOGIES, INC.                                                                
|---------------------- |  | ------------------------------------------------------------------------------------------
|Dated: August 27, 2001 |  | By: /s/ James H. Watson,
      Jr.                                                        
|                       |  | James
      H. Watson, Jr.                                                                
|                       |  | Its:  Principal Executive
      Officer and Principal Accounting Officer of the Registrant

``