U. S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-QSB


     [X] QUARTERLY  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND
         EXCHANGE ACT OF 1934

           For the quarterly period ended: June 30, 2000


     [ ] QUARTERLY  REPORT PURSUANT TO SECTION 13 0R 15(d) OF THE SECURITIES AND
         EXCHANGE ACT OF 1934

        For the transition period from ______________ to _______________


                        Commission File Number: 001-12671


                          The Hartcourt Companies, Inc.
        (Exact name of small business issuer as specified in its charter)

                                      Utah
         (State or other jurisdiction of incorporation or organization)

                                   87-0400541
                        (IRS Employer Identification No.)

          9800 Sepulveda Blvd., Suite 818, Los Angeles California 90045
                    (Address of principal executive offices)

                                 (310) 410-7290
                           (Issuer's telephone number)

     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the restraint 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 June 30, 2000, The Hartcourt Companies, Inc. had 28,443,608 shares of
Common Stock Outstanding.

Transitional Small Business Disclosure Format (check one):

                                            Yes [  ]                 No [ X ]









                                      F-1
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES
                                TABLE OF CONTENTS

                              Report on Form 10-QSB
                                For quarter ended
                                  June 30, 2000
                                                                         Page

PART 1        FINANCIAL INFORMATION

Item 1.       Financial Statements

              Consolidated Balance Sheets at June 30, 2000
              (Unaudited) and December 31, 1999                          F-3

              Consolidated Statements of Operations
              for the Three Months and Six Months ended
              June 30, 2000 and 1999 (Unaudited)                         F-4

              Consolidated Statements of Shareholders' Equity
              for the Six Months ended June 30, 2000 (Unaudited)         F-5

              Consolidated Statements of Cash Flows for the
              Six Months ended June 30, 2000 and 1999 (Unaudited)        F-7

              Notes to the Consolidated Financial Statements             F-8

Item 2.       Management's Discussion and Analysis of Financial
              Condition and Results of Operations                        F-21


PART II  OTHER INFORMATION

Item 1.       Legal Proceedings                                          F-24

Item 2.       Changes in Securities                                      F-25

Item 3.       Defaults upon Senior Securities                            F-25

Item 4.       Submission of Matters to Vote of Security Holders          F-25

Item 5.       Other Information                                          F-25

Item 6.       Exhibits and Reports on Form 8-K                           F-25

Signatures                                                               F-26











                                      F-2
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
Part I Item 1                                    June 30,          December 31,
                                                    2000                1999
                                           ---------------     ----------------
ASSETS                                       (Unaudited)
Current assets:
 Cash and cash equivalents                   $    569,403    $         331,057
 Accounts receivable, net                          58,674               37,626
 Inventory                                        137,143              127,091
 Notes receivable                                 228,800              228,800
 Prepaid expenses and other                        79,024              129,114
 Due from related parties                         173,206              108,222
                                              -----------     ----------------
Total current assets                            1,246,250              961,910
                                              -----------     ----------------
Property and equipment, net                       791,711              815,085
Investments and advances                        7,948,166            5,554,644
Intangibles, net                                2,092,903            2,206,033
                                              -----------     ----------------
Total assets                                 $ 12,079,030    $       9,537,672
                                              ===========     ================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
 Accounts payable                            $    457,350    $         152,709
 Deferred revenue                                  88,549               78,477
 Notes payable, current portion                   163,804              649,998
 Accrued expenses and other current liabilities   879,642            4,073,504
 Payables to related parties                    1,998,296            2,457,497
                                              -----------     ----------------
Total current liabilities                       3,587,641            7,412,185

Notes payable, net of current portion             588,349              608,184
                                              -----------     ----------------
Total liabilities                               4,175,990            8,020,369
                                              -----------     ----------------
Contingencies
Minority interest                                 489,364              661,634
Shareholders' Equity
  Preferred stock:
     Original preferred stock, $0.01 par value,
      1,000 authorized, issued and outstanding         10                   10
   Common stock, $0.001 par value, 100,000,000
      shares authorized; 30,222,524 shares and
      23,832,152 shares issued and outstanding
      at June 30, 2000 and December 31, 1999       30,223               23,833
   Stock subscription receivable              (13,220,000 )                  -
   Treasury stock, at cost (1,778,916 shares
      and 1,524,364 shares at June 30, 2000
      and December 31, 1999)                   (1,918,634 )         (1,680,928 )
   Additional paid-in capital                  61,456,693           38,895,860
   Accumulated deficit                        (38,934,616 )        (36,383,106 )
                                              -----------     ----------------
Total shareholders' equity                      7,413,676              855,669
                                              -----------     ----------------
Total liabilities and shareholders' equity   $ 12,079,030    $       9,537,672
                                              ===========     ================
See accompanying notes to consolidated financial statements.
                                      F-3
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
<S>                                  <C>          <C>          <C>          <C>
                                          Three Months               Six Months
                                          Ended June 30,           Ended June 30,
                                      ----------------------   ------------------------
                                          2000        1999        2000          1999
                                     ----------- -----------   -----------   ----------
Net sales                            $   342,213  $        -   $   690,441  $         -

Cost of sales                            115,531            -      232,072            -
                                      ----------   ----------   ----------   ----------
Gross profit                             226,682            -      458,369            -
                                      ----------   ----------   ----------   ----------
Operating expenses:
 Selling, general and administrative   1,091,997      413,385    2,896,234      655,160
 Depreciation and amortization           102,258            -      207,486            -
                                      ----------   ----------   ----------   ----------
Total operating expenses               1,194,255      413,385    3,103,720      655,160
                                      ----------   ----------   ----------   ----------
Loss from operations                    (967,573)    (413,385)  (2,645,351)    (655,160)

Other income (expense):
 Equity in earnings (loss) of              8,734            -      (32,918)     (28,298)
   affiliate
 Interest expense                        (43,705)           -      (81,954)           -
 Interest income                          13,724            -       21,955       20,095
 Other                                     5,480            -       14,488            -
                                      ----------   ----------   ----------   ----------
Total other income (expense)             (15,767)           -      (78,429)      (8,203)
                                      ----------   ----------   ----------   ----------
Loss from continuing operations         (983,340)    (413,385)  (2,723,780)    (663,363)
   before minority interest
Less:  loss in subsidiary                102,968            -      172,270            -
   attributed to minority interest    ----------   ----------   ----------   ----------
Loss before income taxes                (880,372)    (413,385)  (2,551,510)    (663,363)
Income taxes                                   -       (1,355)           -         (555)
                                      ----------   ----------   ----------   ----------
Net loss                             $  (880,372) $  (414,740) $(2,551,510) $  (663,918)
                                      ==========   ==========   ==========   ==========
Basic and fully diluted loss per     $     (0.03) $     (0.02) $     (0.09) $     (0.03)
  common share                        ==========   ==========   ==========   ==========
Weighted average number of shares     27,940,081   19,640,025   27,134,267   19,306,537
  outstanding                         ==========   ==========   ==========   ==========
</TABLE>
          See accompanying notes to consolidated financial statements.










                                      F-4
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
                            JUNE 30, 2000 (UNAUDITED)
<TABLE>
<S>                                       <C>         <C>                  <C>    <C>           <C>

                                                                                                  Additional
                                                Common Stock              Preferred Stock          Paid-In
                                          -------------------------   -------------------------
              Description                   Shares        Amount        Shares        Amount       Capital
----------------------------------------  -----------   -----------   -----------   -----------   -----------
Balance - December 31, 1999               23,832,152  $     23,833         1,000  $         10  $ 38,895,860

Issuance of shares for consulting             20,000            20             -             -        22,180
  services
Shares issued to investors                   227,445           227             -             -     3,529,719
Sale of shares under Regulation S            300,000           300             -             -     1,199,700
Shares issued upon exercise of warrants    1,477,075         1,477             -             -       100,395
Issuance of warrants for brokerage                 -             -             -             -       203,545
  services
Shares issued to directors in lieu of      1,610,460         1,610             -             -     3,508,344
  Compensation and for services
Shares issued in connection with FTL         254,552           255             -             -       237,451
  acquisition
Common stock subscriptions received                -             -             -             -             -
Shares issued for services                       840             1             -             -        11,999
Shares issued upon exercise of options     2,500,000         2,500             -             -    13,747,500
Net loss                                           -             -             -             -             -
                                         -----------   -----------   -----------   -----------   -----------
Balance - June 30, 2000                   30,222,524  $     30,223         1,000  $         10  $ 61,456,693
                                         ===========   ===========   ===========   ===========   ===========
</TABLE>




















                                      F-5
<PAGE>

<TABLE>
<S>                                           <C>             <C>         <C>           <C>            <C>
                                                  Common
                                                   Stock                                                   Total
                                               Subscriptions      Treasury Stock         Accumulated    Shareholders'
                                                              ------------------------
              Description                       Receivable      Shares        Amount       Deficit         Equity
----------------------------------------      --------------   ---------- ------------  -------------   -------------
Balance - December 31, 1999                   $           -    1,524,364  $(1,680,928)  $(36,383,106)  $    855,669

Issuance of shares for consulting services                -            -            -              -         22,200

Shares issued to investors                                -            -            -              -      3,529,946
Sale of shares under Regulation S                (1,000,000)           -            -              -        200,000
Shares issued upon exercise of warrants                   -            -            -              -        101,872
Issuance of warrants for brokerage                        -            -            -              -        203,545
  services
Shares issued to directors in lieu of                     -            -            -              -      3,509,954
  Compensation and for services
Shares issued in connection with FTL                      -      254,552     (237,706)             -              -
  acquisition
Common stock subscriptions received               1,000,000            -            -              -      1,000,000
Shares issued for services                                -            -            -              -         12,000
Shares issued upon exercise of options          (13,220,000)           -            -              -        530,000
Net loss                                                  -            -            -     (2,551,510)    (2,551,510)
                                               ------------   ----------   ----------    -----------    -----------
Balance - June 30, 2000                       $ (13,220,000)   1,778,916  $(1,918,634)  $(38,934,616)  $  7,413,676
                                               ============   ==========   ==========    ===========    ===========
</TABLE>


          See accompanying notes to consolidated financial statements.



















                                      F-6
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Increase (Decrease) in Cash
                                                     Six Months Ended June 30,
                                                --------------------------------
                                                       2000            1999
                                                ---------------  ---------------
Cash flows from operating activities:
  Net loss                                           $(2,551,510)  $   (663,918)
  Adjustments to reconcile net loss to
   net cash used in operating activities:
    Depreciation and amortization                        207,486              -
    Changes in minority interest                        (172,270)             -
    Equity in loss of affiliate                           32,918              -
    Stock issued for services                          1,024,695         88,750
    Changes in operating assets and liabilities:
      Accounts receivable                                (21,048)             -
      Inventory                                          (10,052)        13,083
      Prepaid expenses and other                          50,090         28,500
      Accounts payable                                   304,640              -
      Accrued expenses and other current liabilities     316,091         8,233
      Net changes in due to (from) related parties       (64,984)       (15,700)
      Deferred revenue                                    10,072              -
                                                      ----------    -----------
Net cash used by operating activities                   (873,872)      (541,052)
                                                      ----------    -----------
Cash flows from investing activities:
  Proceeds from sale of 35% of ECS                             -      5,400,000
  Proceeds on sale of marketable securities                    -      1,135,607
  Advances to Sino Bull for investment purposes       (2,126,440)             -
  Advance towards eMPACT investment                     (300,000)             -
  Distribution of subsidiaries ownership to shareholders       -       (399,388)
  Purchase of property and equipment                     (70,982)             -
                                                      ----------    -----------
Net cash provided by (used in) investing activities   (2,497,422)     6,136,219
                                                      -----------   -----------
Cash flows from financing activities:
   Proceeds from issuance of common stock               3,273,000             -
   Proceeds on sale of common stock                             -        37,935
   Proceeds on sale of common stock issued to
     directors and officers                                     -       337,445
   Proceeds on loans and lines of credit                   88,853        50,000
   Proceeds on exercise of options and warrants         1,301,870             -
   Redemption of preferred stock                                -    (6,405,000)
   Payments to related parties                           (449,808)            -
   Payments on note payable                              (594,882)            -
   Payments on loans from shareholders                     (9,393)            -
                                                      -----------   -----------
Net cash provided by (used in) financing activities     3,609,640    (5,979,620)

Net increase (decrease) in cash                           238,346      (384,453)

Cash and cash equivalents, beginning of period            331,057       384,453
                                                      -----------   -----------
Cash and cash equivalents, end of period             $    569,403  $          -
                                                      ===========   ===========
See accompanying notes to consolidated financial statements.

                                      F-7
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            JUNE 30, 2000 (UNAUDITED)

Item 1

Note 1.    Organization and Nature of Operations

     Stardust,  Inc.-Production-recording-Promotion  ("Stardust"), a corporation
organized under the laws of the State of Utah in September 1983, acquired all of
the outstanding shares of Hartcourt Investments, a Nevada corporation,  pursuant
to an Agreement and Plan of  Reorganization  dated November 5, 1994. At the time
of this acquisition, Stardust was a "shell" corporation with no assets, business
or operations.  Subsequent to the acquisition of Hartcourt Investments, Stardust
changed its name to "The Hartcourt Companies, Inc."

     Hartcourt  Pen was  organized  under  the laws of the  State of  Nevada  in
October 1993 to engage in the sale of writing instruments. Hartcourt Pen entered
into an  Agreement  and Plan of  Reorganization  dated  December  1,  1994  with
Hartcourt  Investments,  pursuant to which Hartcourt Investments acquired all of
the  outstanding  shares of Hartcourt  Pen.  Through  January 1999,  Hartcourt's
operations   relating  to  writing   instruments   involved   the  assembly  and
distribution of writing instruments.  In January 1999 Hartcourt discontinued the
operations of Hartcourt  Investments  and Hartcourt Pen, and disposed of all its
pen related assets in the United States.

     In August 1996,  Hartcourt  entered into a Purchase and Sale Agreement with
NuOasis International,  Inc. ("NuOasis"),  a corporation  incorporated under the
laws of the  Commonwealth  of Bahamas,  for the  purchase of a  commercial  real
estate  project,  consisting of three 5-7 story  apartment  buildings,  commonly
known as the Peony Gardens  Property,  ("Peony  Gardens") located in the eastern
part of Tongxian in Beijing, China. The purchase price consists of a Convertible
Secured  Promissory  Note  granted  to  NuOasis,  in  the  principal  amount  of
$12,000,000,  a security  interest in the property and the greater of 10,000,000
shares of  Hartcourt's  common  stock,  or that number of shares of  Hartcourt's
common stock having a market value equal to  $10,000,000  immediately  preceding
the  closing  date.  On August 8, 1996,  an Addendum  to the  Purchase  and Sale
Agreement  was  agreed  to  by  Hartcourt  and  NuOasis,  by  which  Hartcourt's
obligation to issue stock to NuOasis was reduced to 4,000,000  shares (valued at
$10,000,000) of its common stock. On March 15, 1999,  Hartcourt  entered into an
Exchange  Agreement with Dragon King  Investment  Services Inc.  ("Dragon King")
pursuant to which  Hartcourt  agreed to assign its rights under the Purchase and
Sale  Agreement  dated  August 8,  1996 of its  interest  in the  Peony  Gardens
development for investment securities valued at $10 million. Due to restrictions
on the ability to trade the investment  securities received,  Hartcourt recorded
an impairment of $5,000,000 as of December 31, 1998.

     In September 1996,  Hartcourt  entered into a Sales Agreement with Mandarin
Overseas  Investment Co., Ltd.  ("Mandarin"),  an unaffiliated  Turks and Caicos
chartered  company  located in Hong Kong,  for its  undivided  50%  interest  in
thirty-four  State of Alaska  mineral lease gold lode claims,  known as Lodestar
claims  numbered  35-68,  consisting  of 160  acres  each,  all  located  in the
Melozitna mining district near Tanana, Alaska,  approximately 300 air-kilometers
west of the City of Fairbanks,  Alaska.  Hartcourt paid  $3,000,000 in shares of
its common stock to Mandarin for its undivided 50% interest in the mineral lease

                                      F-8
<PAGE>
gold lode claims.  The number of shares were determined by the average price per
share  over a 10 day  period  for the 10 days  prior  to the  execution  of this
agreement.  In September  1996,  Hartcourt  entered into a Sales  Agreement with
Promed International Ltd. ("Promed"), an unaffiliated Turks and Caicos chartered
company with offices in the British crown colony of Gibraltar,  for the purchase
of their  undivided 50% interest in  thirty-four  State of Alaska  mineral lease
gold lode claims,  known as Lodestar  claims  numbered  1-34,  consisting of 160
acres each, all located in the Melozitna  mining  district near Tanana,  Alaska,
approximately  300  air-kilometers  west  of  the  City  of  Fairbanks,  Alaska.
Hartcourt  paid  $3,000,000  in shares  of its  common  stock to Promed  for its
undivided  50% interest in the mineral  lease gold lode claims,  all shares were
issued  pursuant to Regulation  "S." The number of shares were determined by the
average  price  per  share  over a 10 day  period  for the 10 days  prior to the
execution of this agreement.  In July 1998, Hartcourt filed notice upon Mandarin
and Promed requesting rescission of the purchase of the Alaska gold mine mineral
leases as the sellers failed to provide  Hartcourt with the required  geological
evaluations. On March 8, 1999 Hartcourt entered into a rescission agreement with
the  sellers,  returning  the  claims and  receiving  back  1,298,700  shares of
Hartcourt common stock.

     In December  1996,  Hartcourt  entered  into a  Consulting  Agreement  with
American Equities,  LLC, ("American  Equities"),  a California Limited Liability
Company.  Hartcourt  intended  to  acquire,  manage  and  develop a real  estate
portfolio  through the year 2001. On September 3, 1998,  American Equities filed
suit  against  Hartcourt  for breach of contract.  Hartcourt  denied that it had
breached any contract with  American  Equities and filed a  cross-complaint  for
fraud   and   non-performance   against   American   Equities   and   additional
cross-defendants.  As settlement of these matters on March 8, 1999,  the parties
agreed  that all fees paid to  American  Equities  were  earned  and to  provide
American Equities with a 27.65% interest in ECS. Also,  American Equities agreed
to pay back 1,075 the Series AB preferred  stock dividend issued by Hartcourt in
1998 and 1,000,000 shares of Hartcourt common stock.  Accordingly,  all expenses
relating to  settlement  were  recorded  in the year ended  December  31,  1998.
Additionally, American Equities agreed to provide working capital for ECS.

     On October 3, 1997,  Hartcourt  purchased all of the outstanding  shares of
Pego  and  Pego  became  a  wholly  owned  subsidiary  of  Hartcourt.   Pego,  a
manufacturer's  representative  organization for air and gas handling equipment,
offers a full line of value added services including  distribution,  service and
manufacturing  of  custom  process  equipment  packages.   The  acquisition  was
accounted for using the purchase  method of accounting.  In connection  with the
purchase,  Hartcourt paid $500,000 in cash,  issued 450,000 shares of restricted
common stock,  1,500 shares of Series C redeemable  preferred stock, and entered
into a non-compete agreement with Pego's majority shareholder and director.  The
total value of this transaction was approximately $2,300,000.

     On October 28, 1997, Hartcourt through a wholly owned subsidiary,  acquired
ECS and Pruzin Technologies,  Inc. ("Pruzin"), an Arizona corporation, a related
entity of ECS. ECS specializes in high  technology  contract  manufacturing  and
assembly  of  printed  circuit  boards,  phone  and cable  wires.  ECS has three
manufacturing  facilities,  and contracts  with a maquiladora  in the free trade
zone  in  Sonora,   Mexico.   The  acquisition  was  structured  as  a  tax-free
reorganization and was accounted for using the purchase method of accounting. In
connection with the acquisition,  Hartcourt paid $250,000 in cash, issued a note
payable for  $250,000,  issued  3,400 shares of Series D  convertible  preferred
stock  and  2,500,000  shares  of its  common  stock.  The  total  value  of the
transaction was approximately $9,500,000.
                                      F-9
<PAGE>
     On August 24, 1998,  Harcourt  and ECS  executed an  agreement  and plan of
merger  with Elan  Manufacturing,  Inc.  ("Elan"),  a contract  manufacturer  of
electronic components similar to ECS, located in the Silicon Valley, California.
Under the terms of the  agreement,  Elan was merged  into and with ECS,  thereby
ceasing Elan's  existence.  The merger was effective  September 1, 1998, and the
purchase price of $616,240 was paid by Hartcourt  issuing  724,990 of its common
shares to the three selling shareholders based on a value of $0.85 per share.

     On October  21,  1998,  Mr.  James  Pruzin,  the  selling  shareholder  and
president  of ECS,  formally  requested  a  rescission  of the  October 28, 1997
acquisition  whereby,  Hartcourt through a wholly owned subsidiary  acquired ECS
and Pruzin.  Mr. Pruzin alleged that he was authorized to request  rescission of
the original transaction based on an alleged breach of the acquisition agreement
by Hartcourt  which Hartcourt  denied.  On November  10,1998,  Hartcourt and Mr.
Pruzin  entered  into a memorandum  of  understanding  whereby Mr.  Pruzin could
reacquire  ECS and Pruzin from  Hartcourt  by returning  all of the  Hartcourt's
common and preferred shares originally  issued to Mr. Pruzin,  making payment to
Hartcourt of $1,850,000 during 1999,  negotiating the return of Hartcourt common
shares issued in the Elan transaction, and issued to Hartcourt a promissory note
for $400,000  amortized over five years with monthly payments beginning in 2000.
Subsequently,  Mr.  Pruzin  was  unable to meet the terms of the  memorandum  of
understanding and entered into new negotiations  with Hartcourt.  Mr. Pruzin and
Hartcourt  reached an agreement whereby Mr. Pruzin agreed to return to Hartcourt
2,000,000 common shares of Hartcourt  representing 80% of the amount  originally
issued, and 3,400 shares of Series D preferred stock. Hartcourt agreed to assign
to Mr.  Pruzin a 30%  ownership  interest  in ECS,  and has a right to  purchase
500,000  shares of Hartcourt  common  stock held by Mr.  Pruzin at $1 per share.
Additionally,  as part of the  agreement,  the payment terms for the  promissory
note and advances were changed to thirty-six  monthly payments of $7,083 with no
interest until paid in full.

     Effective  February  1,  1999,  pursuant  to a  Share  Purchase  Agreement,
Hartcourt  acquired  one (1)  share  of  common  stock of  Enova  Holdings  Inc.
("Enova"),  a Nevada  corporation  representing  100% of the  total  issued  and
outstanding  capital  stock of Enova,  making Enova a  wholly-owned  subsidiary.
Effective March 1, 1999, Hartcourt and Enova executed an Exchange Agreement (the
"Enova  Agreement")  whereby  Hartcourt  exchanged  all of its  ownership in two
wholly owned  subsidiaries,  Pego and ECS, for  5,213,594  additional  shares of
common stock of Enova. On March 24, 1999,  Hartcourt entered into a Distribution
Agreement  pursuant to which Hartcourt  agreed to distribute to all shareholders
of record on March 31, 1999,  the 5,213,595  shares of common stock of Enova and
to file,  within a reasonable  period of time  following  such  distribution,  a
Registration Statement on Form 10-SB to cause the distributed shares of Enova to
be registered under the Securities  Exchange Act of 1934.  Enova's  Registration
Statement on Form 10-SB was filed under the  Securities  Exchange Act of 1934 on
January 24, 2000.

     As a result of the Share Purchase  Agreement,  the Enova  Agreement and the
Distribution  Agreement,  each  shareholder  of record of Hartcourt on March 31,
1999  received  one (1)  share of Enova  for  every  four  (4)  shares  owned of
Hartcourt.  Following the  distribution of the Enova shares,  both Hartcourt and
Enova continue to operate as separate companies.

     On August 17, 1999,  Hartcourt entered into a stock purchase agreement with
FTL, a Hong Kong  corporation,  to purchase  4,964,990  shares of common  stock,
representing  58.53% of the total common stock  outstanding.  FTL is a financial

                                      F-10
<PAGE>
data bank  providing  real-time  stock quotes and financial  information of Hong
Kong  listed  companies  as well as  information  on other  international  stock
exchanges  in the U.S. and Europe to  institutional  and retail  investors.  The
purchase  price was agreed to be HK $4.713  (US$ 0.604) per share for a total of
HK$23.4 million or US$3.0 million, payable 50% in cash and the remaining balance
in Hartcourt  common shares.  The  acquisition  was completed on October 4, 1999
with  Hartcourt  making total cash payments of $801,860,  recorded a payable for
$797,140  and  issued  1,500,000  shares of its common  stock to FTL.  The stock
purchase  agreement  required a post closing adjustment for any deficiency to be
paid to FTL in the event  the final  closing  net worth as of the  closing  date
shall be more than $5,000 over and above the net worth  reported in  calculating
the purchase  price.  As a result of the post closing  adjustment,  the purchase
price was  revised to  HK$25,563,842  or  US$3,277,412.  At December  31,  1999,
Hartcourt  recorded  the  increase  in  purchase  price as a result  of the post
closing  adjustment,  as a note payable to FTL of $138,706 and a payable for the
issue of 148,512  shares of common  stock of  Hartcourt.  On January  18,  2000,
Hartcourt issued 254,552  additional shares of common stock to FTL in settlement
of the post closing  adjustment.  The 1,754,552 shares of common stock issued to
FTL are reflected as treasury shares in the  accompanying  financial  statements
since FTL is a subsidiary  of  Hartcourt.  As of August 10, 2000,  Hartcourt has
fully settled its amounts payable to FTL for the acquisition of FTL's shares.

     On March 27,  2000,  FTL entered into a Memorandum  of  Understanding  with
NiceVoice  Investment  Holdings Limited  (NiceVoice) to form a joint venture for
the purpose of establishing  and operating a financial paging service network in
Hong Kong on the FLEX transmission protocol on a PDA receiver device. Subject to
verification  of total costs to be  incurred  in  erection of FLEX  transmission
network, design of financial information broadcast system, sourcing, testing and
tuning of PDA  receiver  devices,  etc.  and  signing  of formal  joint  venture
agreement,  FTL  will  invest  cash  by  phases  to the  amount  not  to  exceed
HK$4,000,000  (approximately US$512,800) in exchange of a total of 51% ownership
in the joint venture. The transaction is currently under management review and a
definitive  joint  venture  agreement is expected to be finalized by  August 31,
2000.

     On June 20, 1999,  Hartcourt  entered  into an  agreement  with Beijing UAC
Stock Trading Online Co., Ltd. ("UAC  Trading") to form a joint venture  company
under the laws of China.  The name of the joint  venture  company is Beijing UAC
Stock  Exchange  Online  Co.  Ltd.  ("UAC").  UAC  operates  the  first and only
nationwide  online  securities  trading  network,  UAC 162  Network,  connecting
investors  with their stock  brokerage  offices via China Pac.  China Pac is the
nationwide  packet switched  network in China owned by China Telecom since 1991.
UAC 162 Network  consists of  proprietary  server  software and user  interface,
servers,  gateways  and  other  communication  hardware.  Under the terms of the
agreement,  for a 35% interest in UAC,  Hartcourt agreed to invest $1,000,000 in
UAC, pay $1,700,000 to the owners of UAC Trading and transfer  1,000,000  common
shares of Hartcourt to UAC.  200,000 of these common shares will be  transferred
to UAC Trading for an existing  loan of $200,000 and 800,000  common  shares are
still to be issued and will be  recorded  as a loan from  Hartcourt  to UAC upon
issuance.  On August 9, 1999,  Hartcourt  and UAC Trading  agreed to convert the
Hartcourt loan of $200,000 into an option to purchase an additional 15% interest
in UAC from UAC Trading.  Hartcourt  exercised its option to convert the loan to
UAC for an additional 15% interest in UAC making  Hartcourt's  total  investment
interest in UAC to 50%.  The transaction  is to be effective by August 31, 2000.

     On December  30,  1996,  Hartcourt  and  American  Equities  entered into a

                                      F-11
<PAGE>
Warrant  Agreement,  whereby  Hartcourt  agreed  to issue  and sell to  American
Equities, for the price of $100, a warrant to purchase up to 2,000,000 shares of
its common stock,  $.01 par value,  in connection  with the consulting  services
provided to Hartcourt. American Equities shall have the right to purchase at any
time and from time to time prior to December 30, 2002, up to the number of fully
paid and  non-assessable  shares of  warrants  stock,  upon  payment of specific
exercise price or apply the cashless exercise clause specified in the Agreement.
On  September  9, 1999,  pursuant  to  Cashless  Exercise  clause in the Warrant
Agreement,  American Equity exercised its cashless  exercise right and converted
800,000 warrants into 621,674  Hartcourt's  common shares without payment of any
consideration. On December 14, 1999, American Equities filed a complaint against
Hartcourt alleging breach of Warrant Agreement, claiming damages of $30,000,000.
The case  concerned  dispute  over  whether  shares  issued  under  the  Warrant
Agreement  would be  issued as  restricted  shares or free  trading  shares.  An
agreement was reached and the litigation was settled on March 20, 2000. American
Equities  was  allowed to  further  exercise  its  cashless  exercise  right and
converted the remaining  1,200,000  warrants into  1,070,075 free trading common
shares of Hartcourt without any payment of consideration.

     In November 1999,  Sino Bull Group  ("Group") was formed with the intention
to consolidate various related businesses acquired or expected to be acquired by
Hartcourt or Sino Bull.com Inc. For the purposes of presenting  these businesses
under a unified  structure and strong brand name, a  restructuring  of the Group
will result in  consolidating  these  businesses  under Sino Bull.com.  Inc, the
holding  company of the Group that was  incorporated  in British Virgin Islands.
The mission of the Group is to become the  premier  e-commerce  network  service
provider (providing  financial  information and related technology  services) to
investors and financial  institutions  in Greater  China.  Hartcourt  intends to
transfer its ownership  interests in UAC and FTL into Sino Bull.com Inc.  during
calendar year 2000 in exchange for certain equity interest in Sino Bull.com Inc.

     On December 23, 1999,  Hartcourt entered into an agreement with GoCall Inc.
("GoCall"), a Delaware corporation,  to form a strategic alliance for the common
interest  of the  respective  corporations,  including  but not  limited  to the
development  of  GoCall's  Internet  related  development-stage  businesses  and
software.  GoCall agreed to give Hartcourt  1,000,000  shares of its convertible
preferred stock.  Each share of convertible  preferred stock is convertible into
10 shares of common stock (restricted under Rule 144 for 12 months).  In return,
Hartcourt agreed to give GoCall all of the marketable  securities  received from
Dragon  King which are carried at $5.0  million  plus  192,000  shares of common
stock of ECS.  Hartcourt  withheld 192,000 shares of common stock of ECS, valued
at $196,358 at the date of closing on December 29, 1999 and this was recorded as
payable to GoCall at December 31, 1999. The GoCall  convertible  preferred stock
has subsequently been valued at $2,500,000.  Accordingly, Hartcourt has recorded
an impairment of $2,696,358 against the marketable securities for the year ended
December 31,  1999.  Hartcourt  has the option to appoint  three out of the five
directors of GoCall.  As of August 10, 2000,  Hartcourt  has not  appointed  any
directors  to the GoCall  Board and has not  exercised  any  control on GoCall's
operations.

Recent Events

     No  assurance  can be given that Term Sheets and Heads of  Agreements  will
result in actual  agreements  or that the  terms of the  agreements  will not be
significantly  changed,  or that any of the  financing  needs to  consummate the
agreements discussed below will be successfully completed.

                                      F-12
<PAGE>
     Hartcourt's  partners in the joint ventures  discussed  below are expecting
Hartcourt  to  provide  two key  elements  in  these  joint  ventures:  Internet
technology  and investment  capital.  Hartcourt  management,  which has recently
hired  individuals with extensive  experience and expertise in relevant industry
sectors,  intends to provide  Internet  technology  by merging with or acquiring
companies already active in these businesses.  On the financial side,  Hartcourt
plans to raise substantial funds necessary to carry out the plans of its venture
partners by selling its own common  shares to  selected  investors/partners  and
bringing in partners whose  contributions to each joint venture will include the
necessary  cash  contributions.  If Hartcourt is not able to raise the necessary
funds  indicated in the  agreements,  the agreements will need to be modified or
cancelled.

     Beijing Innostar Hi-Tech  Enterprises,  Ltd.  ("Innostar") - On October 20,
1999,  Hartcourt  signed a Joint Venture  Agreement with Innostar to establish a
wireless  nationwide  Internet service provider network and IP phone services in
China  via a Chinese  satellite.  The total  amount of  investment  in the joint
venture company will be $24.0 million of which $14.0 million will be contributed
by Innostar for 65%  ownership  interest and $10.0  million by Hartcourt for 35%
ownership interest.  The profits and losses of the joint venture company will be
distributed in accordance with their ownership  interest ratios. The duration of
the  Joint  Venture  Agreement  is  fifteen  (15)  years.  The date of  official
establishment  of the  joint  venture  company  shall be the  date the  business
license is issued.  As of August 10, 2000  Hartcourt is waiting for the approval
and grant of the business license. Hartcourt will need to raise the funds needed
to complete this transaction.

     eSAT, Inc.  ("eSAT") - On November 29, 1999,  Hartcourt signed a Term Sheet
with eSAT to create a strategic  alliance  through the  exchange of their common
shares to establish a wireless Internet service provider and IP phone network in
China.  In a private  placement,  Hartcourt will purchase  2,000,000  restricted
common shares of eSAT.  eSAT will also grant  Hartcourt an option to purchase an
additional  2,000,000  restricted common shares of eSAT at the exercise price of
$4.00 per share subject to customary  anti-dilution  provisions and  exercisable
for a three year period.  Fully  exercised,  it will  represent 20% ownership in
eSAT.  In exchange,  Hartcourt  will issue  1,000,000 of its  restricted  common
shares to eSAT.  All the shares and  options  will be placed in an escrow with a
mutually  agreed agent.  The operation was expected to start in late April 2000.
If by April  30,  2000,  eSAT was not able to  obtain a  satisfactory  exclusive
supply  contract  with the  Innostar  Joint  Venture,  either party may void the
agreement,  and the  escrow  agent will be  instructed  to return the shares and
options to the respective parties.  The parties did not open the escrow and have
mutually agreed to terminate the agreement immediately.

     Beijing Shangdi Net Technologies Center Co., Ltd. ("Shangdi") - On December
18,  1999,  Sino Bull signed a Term Sheet  Agreement  with Shangdi to form a new
corporation in Beijing. Sino Bull shall have 40% interest and Shangdi shall have
60% interest in the new corporation.  On April 12, 2000, Sino Bull signed a Term
Sheet  Agreement  with Shangdi  revising  the terms of the Term Sheet  Agreement
signed on December 18, 1999.  The terms of the revised  agreement  required Sino
Bull to pay Shangdi  US$670,000  being the  consideration  of all  tangible  and
intangible assets in relation to Shangdi's computer network information services
excluding  cash and  debts and  33.84%  shares  of Hua Xia  Information  Company
Limited;  invest US$1,000,000 to a newly formed company Sinobull Network Inc., a
corporation  registered  in Beijing,  for its  working  capital  needs;  140,000
restricted  common shares of Hartcourt to Shangdi and 60,000  restricted  common

                                      F-13
<PAGE>
shares of Hartcourt to Sinobull Network,  Inc. In exchange,  Shangdi  agreed  to
transfer  without  any pledge  and debt,  all tangible and intangible  assets in
relation to computer network  information  services to Sinobull  Network,  Inc.;
transfer  to  Hartcourt  40%  of the  ownership  interest  in  Tian  Di Hu  Lian
Technologies, Ltd, a BVI corporation,  holding the interest for the shareholders
of Shangdi.  After the above transfers,  Shangdi shall be entitled to own 18% of
total  shares of Sino  Bull.  As of  August  10,  2000,  Sino Bull has paid cash
consideration of $1,000,000 towards the purchase of Shangdi.  The $1,000,000 was
advanced by Hartcourt to Sino Bull. These transactions have not been consummated
as of August 10, 2000.

     StreamingAsia.Com  Ltd.  ("StreamingAsia")  - On April 14, 2000,  Hartcourt
announced  that Sino Bull  signed a  Subscription  and  Shareholders'  Agreement
("Agreement")  relating to StreamingAsia,  whereby Sino Bull agreed to subscribe
all of the  issued  and  outstanding  fully  paid  shares of  StreamingAsia  for
HK$7,000,000   (approximately   US$897,500).   The  terms  of  payment  included
HK$500,000  (approximately US$64,100) payable in cashier's check upon signing of
the  Agreement;  at  the  option  of  Sino  Bull,  HK$1,500,000   (approximately
US$192,300)  payable in cash or Sino Bull  delivering  such  number of shares of
Hartcourt within 14 days after signing the Agreement;  HK$500,000 (approximately
US$64,100)  payable  in cash  within  30 days  from the  date of the  Agreement;
HK$1,000,000  (approximately US$128,200) payable in cash within 60 days from the
date of the Agreement;  HK$1,000,000  (approximately US$128,200) payable in cash
within 90 days of the date of the  Agreement;  and  HK$2,500,000  (approximately
US$320,600)  within  120 days  from the date of the  Agreement.  Sino  Bull will
appoint two members to the Board of Directors of  StreamingAsia.  Together  with
the existing two directors, the new board shall consist of four directors. As of
August 10, 2000,  Sino Bull has completed the acquisition of  StreamingAsia  and
paid the cash consideration of $897,500.  The $897,500 was advanced by Hartcourt
to Sino Bull.

     Shanghai Guo Mao Science & Technology Co. Ltd. ("Guo Mao") - On December 1,
1999,  Sino Bull  signed a Term Sheet  Agreement  with Guo Mao  whereby  Guo Mao
agreed to issue  new  shares  for a total  proceeds  of  $1,000,000  which  will
represent 50% of the expanded  capital of Guo Mao. Sino Bull agreed to subscribe
for all the new shares issued by Guo Mao. On May 16, 2000, Sino Bull and Hopeful
Internet  Technologies  Limited  ("Hopeful")  entered into an agreement  whereby
Hopeful,  an  investment  holding  company  incorporated  in the British  Virgin
Islands,  will acquire through its  wholly-owned  subsidiary  Shanghai  Sinobull
Financial  Information Company Limited, all of the operating assets and business
of Guo Mao. To finance this  acquisition,  Hopeful will issue new shares to Sino
Bull equal to 40% of the expanded  capital of Hopeful for a total  consideration
of $1,000,000.  The terms of payment by Sino Bull for the purchase of new shares
will be: $200,000 in cash upon signing of the agreement; $150,000 in cash within
30 days of signing of the agreement;  $150,000 in cash within 60 days of signing
of the agreement;  and $500,000 within 30 days after signing of the agreement in
shares of  Hartcourt  based on the average  closing  price in the last 7 trading
days before  payment,  or in shares of Sino Bull based upon the  valuation to be
agreed on by the parties. Sino Bull will appoint not more than five directors to
the board of Guo Mao.  Together with the existing five directors,  the new board
shall consist of not more than ten directors.  The  transactions are expected to
close by August 31, 2000.

     Swartz  Private  Equity,  LLC  ("Swartz") - Swartz is an investment  entity
focused on equity  investments in Internet and other high technology  companies.
On November 3, 1999,  Hartcourt  signed an  Investment  Agreement  with  Swartz.

                                      F-14
<PAGE>
Swartz  agreed  to  purchase  from  Hartcourt,  from  time to  time,  shares  of
Hartcourt's common stock, as part of an offering of common stock by Hartcourt to
Swartz, for a maximum aggregate  offering amount of $25,000,000.  These fundings
will be used to satisfy  Hartcour's  working capital  requirements for the year
2000 and complete  acquisitions of Internet  related  operations.  On January 5,
2000,  Hartcourt  and  Swartz  agreed to  increase  the equity  line  funding to
$35,000,000  due to the planned  acquisitions  of Internet  operations in China.
Hartcourt is currently preparing to file a form SB-2 Registration  document with
SEC to register  additional common shares for issuance to Swartz.  Once approved
by SEC,  Swartz has the  obligation to purchase these shares at the market price
less 10 percent discount during the next 24 months.

     eMPACT Solutions,  Inc. ("eMPACT") - On February 9, 2000, Hartcourt entered
into a Stock Purchase Agreement Term Sheet to purchase 30% of the authorized and
outstanding  shares of eMPACT's new shares of common stock.  The purchase  price
was agreed to be $2,000,000,  payable $1,000,000 in cash at the date of closing,
and the remainder $1,000,000 in cash within ninety days of closing. In the event
that  eMPACT  shall fail to meet the  revenues  projections  for the fiscal year
2000,  Hartcourt shall receive an additional one percent of the shares of eMPACT
for every  percent that revenue does not meet the  projections  for revenue to a
maximum of an additional  twenty  percent.  On April 10, 2000,  Hartcourt paid a
consideration  of $300,000 as an advance  towards the  purchase  price of eMPACT
shares. Hartcourt is currently negotiating to finalize the remaining investment.

     Shenzhen China Cable Integrated Network Co. Ltd. ('SCIC") - On February 25,
2000,  Hartcourt signed a Letter of Intent with Shenzhen Sinlan  Investment Co.,
Ltd. to jointly  invest in SCIC.  No terms have been  reached,  and a definitive
agreement to form a joint venture company is currently being delayed pending the
implementation of the WTO (World Trade Organization) agreement. SCIC operates an
exclusive  television and cable network in the capital city of Chengdu.  SCIC is
planning an expansion  program to add  subscribers and to modernize the existing
system  and  make  it  a  showcase  cable  system  with   interconnecting   data
transmission via a network of satellite and cable transmission.

     Heads of  Agreement:  On April 8,  2000,  Hartcourt  entered  into Heads of
Agreement  ("Agreement")  with DF Ltd.,  Loughborough Ltd., and Express Internet
Investment Ltd. (collectively, "the Management") and a fourth investor to form a
joint venture company for the commercial  exploitation of the Publication Rights
of the internet and  production  of the content of the website in respect of the
laws of China.  Hartcourt is currently  having  discussions  with three possible
investors  and is trying to  recruit  one of these  investors  to be the  fourth
investor.  The Agreement does not require Hartcourt to bring on board the fourth
investor  and there are no  guarantees  that  Hartcourt  will be  successful  in
recruiting the fourth investor.  Per the terms of the Agreement,  both Hartcourt
and the fourth  investor's  obligation are to invest  US$2,000,000  each, in the
joint venture company for 25% ownership interest and share the responsibility in
providing  funding,   finance  and  technological  support.  The  obligation  of
Hartcourt and the fourth  investor is to provide  funding as working capital for
the joint venture  company  subject to the  conditions  precedent that the joint
venture  company shall have entered into an agreement with the relevant  parties
in China  for the  commercial  exploitation  of the  Publication  Rights  on the
Internet and the website. Each of the investors shall within 14 days of entering
into such  agreement by the joint venture  company,  pay a sum of  US$1,000,000,
making a US$2,000,000 being the 1st Tranche of the working capital; within three
(3) months  thereafter  pay another sum of  US$1,000,000,  making a US$2,000,000
being the 2nd Tranche of the working capital for the remaining  portion of their

                                      F-15
<PAGE>
investment. Production of the website shall commence upon the payment in full of
the  1st  Tranche  by the  investors  to  the  joint  venture  company  and  the
appropriate production costs being made available to the parties responsible for
production.  The joint venture company is currently negotiating  agreements with
the  relevant  parties  in  China  and has not  been  granted  approval  for the
commercial  exploitation  of the  Publication  Rights  on the  Internet  and the
website.  Therefore, as of August 10, 2000, Hartcourt has no payment obligations
under this Agreement.

     Fee  Agreement  for  Introduction  Services:  On April 19, 2000,  Hartcourt
entered into a Fee Agreement for Introduction  Services  ('Agreement") with Tang
Wai Leong and Thomas Kwok,  (collectively  referred to as "Introducers") whereby
the  Introducers  will use their best  efforts to search for,  identify and make
known to Hartcourt  Internet-related  business and  opportunities  for potential
acquisition  by  Hartcourt.  In addition,  Introducers  will seek out sources of
funding and search for suitable  candidates  for  employment by Hartcourt in its
Chinese  operations.  Hartcourt  agrees to satisfy  Introducers time and expense
incurred,  up  to  and  including  the  first  acquisition  by  Hartcourt  of an
opportunity  introduced or arranged by  Introducers,  by granting to Introducers
options to purchase up to 2,500,000  shares of Hartcourt common stock at a price
of  Five   Dollars   and  Fifty  Cents   ($5.50)   per  share.   The  option  is
non-transferable  and will  expire  unless  exercised  on or  before  the  third
anniversary of the date of Agreement.  Upon  consummation of the introduction by
the Introducers and Hartcourt  completing the  acquisition,  Hartcourt agreed to
register  with the  Securities  and  Exchange  Commission  under a Form S-8 such
shares  granted under the option  agreement,  and shall cause such  registration
statement to remain effective at all times while Introducers holds the options.

     The  Introducers  have  introduced  to  Hartcourt a  potential  acquisition
opportunity  and  Hartcourt  signed the necessary  documents to  consummate  the
purchase of an entity  (Shenzhen  Rayes Group  Limited) on April 27,  2000.  The
Introducers have subsequently exercised their option to acquire 2,500,000 shares
of Hartcourt  common stock.  On May 8, 2000, in accordance with the terms of the
Agreement,  Hartcourt  filed a Form  S-8 to  register  with the  Securities  and
Exchange  Commission the 2,500,000  options granted to the Introducers under the
Agreement.

     Shenzhen  Rayes Group Limited  ("Shenzhen"):  On April 27, 2000,  Hartcourt
signed a Stock Purchase  Agreement Term Sheet with Shenzhen to form a new entity
of  which  Hartcourt  desires  to  purchase   fifty-one  percent  (51%)  of  the
outstanding  shares of the  capital  stock  and  Shenzhen  agrees to retain  the
remaining forty-nine percent (49%) of the outstanding shares. Shenzhen being the
sole owner all of rights,  title and interest in an operating company desires to
contribute  fifty-one  percent  (51%)  of its  share  to  the  new  entity.  The
transaction  is to close no later than 45 days  following  the execution of this
Agreement during which time all due diligence shall be completed, which includes
evaluation of the third party and the  operating  company by Morgan  Stanley,  a
legal opinion of counsel as to the  acceptability  of the proposed  structure of
Hartcourt's  acquisition  of fifty-one  percent  (51%) of new entity,  financial
reviews,  et al. The purchase price shall be not less than US$50,000,000 in cash
and not exceeding US$76,000,000  (including  US$50,000,000 in cash together with
marketable  shares of up to US$26,000,000 in value).  The terms of the Agreement
required: a) Hartcourt to deposit $10,000,000 in an escrow account no later than
April 28, 2000 upon complete  execution of the Agreement;  b) upon completion of
all  of  its  due  diligence,   including   evaluation  by  Morgan  Stanley  and
confirmation  by legal  counsel  as to  acceptable  structure,  Hartcourt  shall
deposit such  additional  funds as shall be determined as required in conformity
                                      F-16
<PAGE>
with the value  established  by Morgan  Stanley.  On April 28,  2000,  Hartcourt
entered into an agreement  with another third party who opened the escrow with a
letter of credit and deposited $10,000,000 on behalf of Hartcourt.  As of August
10,  2000,  the term of the escrow has  expired and the  parties  have  mutually
agreed to extend the term of the  Agreement  to complete  the due  diligence  by
October 31, 2000.  Hartcourt is currently  performing  its own due diligence and
plans  to  complete  the  transaction.   However,  the  terms  of the agreement,
including the amounts involved, may be significantly modified.

     Sino Bull.Com Inc. ("Sino Bull") - On May 1, 2000,  Hartcourt and Sino Bull
entered into an Exchange  Agreement  and agreed to exchange  shares of interests
Hartcourt has in certain  related  businesses  for Sino Bull common  stock.  The
terms of Agreement  required Sino Bull to exchange  forty-eight (48%) percent of
its common stock (par value @ $1.00) for all of Hartcourt's  ownership interests
in the  following  companies:  a) 58.53% of Financial  Telecom  Limited;  50% of
Beijing  UAC  Stock  Exchange  Online  Co  Ltd.;  c) 40% of  Shangdi;  d) 50% of
StreamingAsia;  e) 50% of GuoMao.  The  Agreement  required Sino Bull to form an
eleven (11) member  Board of Directors  group with  Hartcourt to appoint six (6)
members and Sino Bull to appoint five (5) members. The transaction closed on May
1, 2000 and the parties mutually agreed to make it effective by August 31, 2000.
As a result of this  restructure,  Sino Bull will become an  investment  holding
company and an affiliate  of  Hartcourt.  Hartcourt is currently  reviewing  the
structure of  operations  of Sino Bull under the laws of China and Hong Kong and
proposes  to finalize  the  structure  by the end of  September  2000.

     Koffman Securities Limited ("Koffman"): On June 12, 2000, Hartcourt entered
into a Stock Purchase Agreement Term Sheet with Koffman, a securities  brokerage
firm, to purchase 30% of the expanded capital stock of Koffman for HK$22,285,000
(approximately US$2,857,050).  The transaction shall close no later than 60 days
following  the  execution of the  Agreement  during which time all due diligence
shall  have  been  completed,  which  shall  include  but not be  limited  to an
evaluation of Koffman by the auditors, appraisers and legal counsel appointed by
Hartcourt  for  this  purpose  and a  legal  opinion  of its  counsel  as to the
acceptability  of the proposed  structure of  Hartcourt's  acquisition of 30% of
Koffman,  financial  reviews,  and other usual and customary due diligence.  The
purchase  price shall be payable as follows:  3/4 of the purchase price shall be
payable upon  execution  of a definitive  agreement to purchase and sell by both
parties based upon completion of all of its due diligence,  including evaluation
and appraisal and  confirmation by legal counsel as to the  acceptability of the
proposed structure of Hartcourt's  acquisition of 30% of Koffman; and 3/4 of the
purchase price payable in three successive equal monthly  installments.  The net
asset  value  of  Koffman  of   approximately   HK$52   million   (approximately
US$6,666,667)  as at  March  31,  2000  was  agreed  to be  the  benchmark.  The
consideration  to be paid for Koffman is subject to adjustment  after the result
of an independent  audit by the auditors and appraisal of the net asset value of
Koffman  within the time set forth  above with the  adjusted  net asset value of
Koffman not being greater than HK$52 million.  Hartcourt is currently performing
its due diligence review and both the parties have mutually agreed to extend the
due diligence  review of Hartcourt,  and plans are to close the  transaction  by
September 30, 2000.

     Shanghai Wind  Information  Company,  Limited  ("Wind"):  On June 23, 2000,
Hartcourt  signed a Stock  Purchase  Agreement Term Sheet with Wind, a financial
data service  company,  to purchase 40% of the expanded  capital  stock of Wind,
excluding its insurance operations,  for $4,000,000. The purchase price shall be
payable  as  follows:  $500,000  in  cash to be used for Wind business expansion
upon completion of all due diligence by Hartcourt no later than August 15, 2000;

                                      F-17
<PAGE>
$1,500,000 in cash shall be payable  within 15 days upon  obtaining  approval of
the Stock Purchase  Agreement by the relevant  government  authorities;  and the
remaining  $2,000,000  shall be paid in  Hartcourt  common  stock which shall be
valued at the bid price on the date of closing,  such date to be  determined  by
Wind after the execution of the agreement.  It was further  mutually agreed that
six months  after the date of  closing,  Wind shall have the option to  exchange
one-half of the Hartcourt  common shares it received from  Hartcourt for cash of
$1,000,000  based on the same valuation of the shares as was used on the date of
closing.  Hartcourt  is currently  performing  its due  diligence  review on the
operations of Wind and has not made any payments as of August 10, 2000.

Note 2.    Basis of Presentation

     The  accompanying  unaudited  consolidated  financial  statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information and with the  instructions  to Form 10-QSB.  Accordingly,
they do not include all of the information  and footnotes  required by generally
accepted  accounting  principles for complete  financial  statements and related
notes included in the Company's 1999 Form 10-KSB.

     In the  opinion of  management,  the  accompanying  unaudited  consolidated
financial   statements  contain  all  adjustments  (which  include  only  normal
recurring  adjustments)  necessary to present  fairly the balance  sheets of The
Hartcourt Companies,  Inc. and Subsidiaries as of June 30, 2000 and December 31,
1999,  and the  results  of their  operations  and their  cash flows for the six
months  ended June 30, 2000 and 1999.  The  financial  statements  for the three
months  and six months  ended  June 30,  2000 are  consolidated  to include  the
accounts of The Hartcourt  Companies and its 58.53% owned  subsidiary  Financial
Telecom  Limited,  and its 35% owned  equity  investment  in  Beijing  UAC Stock
Exchange  Online Co. Ltd. The financial  statements for the three months and six
months  period ended June 30, 1999  include  only the accounts of The  Hartcourt
Companies,  Inc. The operations of Hartcourt Pen and Hartcourt  Investments were
discontinued  in January 1999 and Hartcourt's  investment in Pego Systems,  Inc.
and  Electronic  Components  and Systems,  Inc. was spun-off to Enova  effective
March 1, 1999 and distributed as stock dividend.

     The results of  operations  for the three  months and six months ended June
30, 2000 are not  necessarily  indicative  of the results to be expected for the
entire year.

     Certain 1999 amounts have been  reclassified  to conform to current  period
presentation.  These reclassifications have no effect on previously reported net
income.

     The accounting policies followed by the Company are set forth in Note A. to
the  Company's  financial  statements as stated in its report on Form 10-KSB for
the fiscal year ended December 31, 1999.










                                      F-18
<PAGE>
Note 3.    Supplemental Disclosure of Non-Cash Financing Activities
                                               Six Months          Six Months
                                                 Ended               Ended
                                             June 30, 2000       June 30, 1999
                                           ----------------   -----------------
Cash paid for:
   Interest                                 $     43,705      $               -
   Taxes                                               -                  1,355
                                            ------------      -----------------
Non-cash operating and financing activities:
   Shares issued to director in liquidation $  3,509,954      $               -
     of payable
   Preferred stock issued for dividends                -                270,000



Note 4.    Loss per Share
<TABLE>
<S>                                       <C>            <C>            <C>              <C>
                                          Three Months  Three Months    Six Months       Six Months
                                              Ended        Ended           Ended           Ended
                                             June 30,     June 30,        June 30,        June 30,
                                               2000         1999            2000            1999
                                          -------------  -------------  -------------   -------------

Net loss                                  $    880,372   $    414,740   $  2,551,510     $    663,918

Effects of dilutive securities
                                           -----------    -----------    -----------      -----------

Weighted average shares outstanding         27,940,081     19,640,025     27,134,267       19,306,537
                                           ===========    ===========    ===========      ===========

Basic and dilutive earnings per share     $      (0.03)  $      (0.02)  $      (0.09)     $      (.03)
                                           ===========    ===========    ===========       ==========
</TABLE>

     At June 30, 2000 and 1999,  the Company had 483,530 and 2,000,000  warrants
and options outstanding,  each exercisable into one share of common stock. These
instruments  were not included in the computation of diluted  earnings per share
for any of the periods presented,  due to their  anti-dilutive  effects based on
the net loss reported for each period.














                                      F-19
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            JUNE 30, 2000 (UNAUDITED)
Note 5. Litigation

Charles  E.  Hogue  vs.  Hartcourt. Circuit Court of the Ninth Judicial Circuit,
Orange County, Florida Case N. C10-2190

     The  litigation  concerns a claim filed on April 8, 2000 against  Hartcourt
for breach of contract for alleged fees due to Charles Hogue  ("plaintiff")  for
introductory  services.  Such  fee was  set as a  percentage of the  transaction
contemplated  and a check of $40,500 for payment in full thereof was tendered to
the plaintiff which the plaintiff  refused  claiming sums far in excess of those
agreed to. Hartcourt's legal counsel has interposed a motion to dismiss the suit
which is pending  before the court and is confident of success in disposition of
this matter.

     ComericaBank of California ("Comerica") vs. Enova. Et al. Superior Court of
California, County of Los Angeles, California. Case No. BC 221594.

     This  litigation  concerns  Hartcourt's  alleged  obligation  as an alleged
guarantor of another entity's  ("Pego") alleged  obligation on a promissory note
that is asserted to be in  non-financial  default.  The plaintiff in that matter
may be the subject of a cross-complaint  by Hartcourt,  which will depend on the
evidence disclosed by documents Harcourt has demanded be produced. The complaint
alleges that Harcourt executed a guarantee of obligation of Pego  (approximately
$925,000) which obligation went into non-financial  default.  Pego expects to be
able to settle with plaintiff and such  settlement  will  eliminate  Hartcourt's
liability.  The prospects for the success of those settlement  negotiations,  as
well as the  approximately  range or amount of any potential  loss by Hartcourt,
are uncertain at this time.

     The company is party to various claims and legal proceedings arising out of
the normal course of its business.  These claims and legal proceedings relate to
contractual rights and obligations,  employment  matters,  and claims of product
liability.  While there can be no assurance that an adverse determination of any
such  matters  could not have a material  adverse  impact in any future  period,
management does not believe,  based upon information known to it, that the final
resolution of any of these matters will have a material  adverse effect upon the
Company's  consolidated  financial position and annual results of operations and
cash flows.















                                      F-20
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                              RESULTS OF OPERATIONS
                            JUNE 30, 2000 (UNAUDITED)

Part I
Item 2

     Currently,  Hartcourt  is involved in  Internet  joint  ventures in Asia to
facilitate the expansion of China's first commercial  e-trade  financial network
and wireless Internet Service Provider  services.  Hartcourt has set as its goal
to create the  premiere  financial  portal in the  Chinese  market by building a
network of Internet companies in partnership with young Chinese entrepreneurs as
well as government  owned entities.  Its mission is to become one of the leading
Internet  companies  in Asia.  With a  vision  to create the  premier  financial
portal and financial information  technology service provider in Asia, Sino Bull
was incorporated in the BVI in November 1999 as an investment holding company to
consolidate  various related businesses  acquired by Hartcourt during the period
from  August  1999 to  December  1999.  For the  purposes  of  presenting  these
businesses  under a unified and strong  brandname,  a restructuring  exercise is
currently  underway  to  consolidate  these  businesses  under  Sino Bull.  Upon
completion  of the  restructuring  exercise,  Sino Bull will  operate  a premier
financial  portal on the  Chinese  Internet  with a  comprehensive  Web site and
supporting utilities that will be capable of executing  securities  transactions
on-line in a timely and  efficient  manner  while  providing  real-time  quotes,
research,  charts and other  collateral  information  regarding  stocks,  bonds,
currencies and other markets in China and other Asian markets.

     Hartcourt's  future  business,  including  expansion of its current limited
operations  and  acquisition  plans  requires   additional  equity  and/or  debt
financing,  which  may not be  available  in a  timely  manner  on  commercially
reasonable  terms,  or at  all.  Harcourt's  primary  objective  is  to  acquire
established  operating companies with histories of growth and profitability,  in
order to  diversify  and create a  multi-dimensional  Internet  service  related
company.

     During 1999, Hartcourt continued its previously implemented plan to acquire
operating  companies  that were in  established  industries  with a  history  of
growth. However, as a result of continued losses,  particularly at the Company's
Electronic   Components  and  Systems,   Inc.  subsidiary,   Hartcourt  recorded
significant  impairments  to its  goodwill  in 1998.  In March  1999,  Hartcourt
entered into a series of agreements and transactions  that in the aggregate were
designed to streamline and restructure the company while dissolving the entities
comprising of inactive assets and settle outstanding litigation.  As a result of
such restructuring,  Hartcourt  discontinued the operations of Hartcourt Pen and
Hartcourt  Investments  and had a spin-off  of  Hartcourt's  investment  in Pego
(100%) and ECS (35%). Hartcourt effectively became an entity with no operations.

Results of Operations:

     The  operations of Hartcourt for the three months and six months ended June
30, 2000 primarily consisted of operations of FTL and Hartcourt's 35% investment
interest in UAC.  Operations  of Hartcourt Pen and  Hartcourt  Investments  were
discontinued  at the  beginning  of 1999,  and  operations  of Pego and ECS were
disposed off as a result of spin-off to Enova and the subsequent distribution of
Enova as a stock dividend to Hartcourt shareholders.

     Net sales and cost of sales: The Company recorded net sales of $342,213 and
                                      F-21
<PAGE>
$690,441  for the three  months and six months  ended June 30, 2000  compared to
zero for the same periods in 1999. Net sales  consisted of the sale of financial
pagers and the related Internet and telephone  services.  Cost of sales amounted
to $115,531 and $232,072 for the three months and six months ended June 30, 2000
compared  to zero  for the same  periods  in  1999.  Hartcourt  did not have any
ongoing operations during the first and second quarters of 1999.

     Corporate  selling,   general  and   administrative   (SGA)  expenses  were
$1,091,997  and  $2,896,234  for the three  months and six months ended June 30,
2000  compared to $413,385 and  $655,160,  respectively  for the same periods in
1999.  The increase is primarily  attributed to additional  consulting and legal
costs associated with the  restructuring of Hartcourt's  business,  and expenses
incurred in brokerage fees in connection  with the issuance of warrants  raising
working capital.

Liquidity and Capital Resources:

     Hartcourt's principal capital requirements during the year 2000 are to fund
the  acquisitions of growth oriented  Internet  related  operating  companies in
China and Asia. During the six months ended June 30, 2000,  Hartcourt has raised
necessary funds to carry out its plans of acquisitions by selling its own common
shares  to  selected   investors  and  bringing  in  business   partners   whose
contributions included the necessary cash.

     As shown in the accompanying  financial statements,  Hartcourt incurred net
losses of  $2,551,510  and  $663,918  for the six months ended June 30, 2000 and
1999, respectively.  Additionally,  Hartcourt's current liabilities exceeded its
current  assets  by  $2,341,391  at June 30,  2000.  These  factors,  as well as
negative  cash  flows  from  operations,  Hartcourt's  inability  to  meet  debt
obligations and the need to raise additional funds to accomplish its objectives,
create  substantial  doubt  about  Hartcourt's  ability to  continue  as a going
concern.

     Hartcourt has taken certain  restructuring steps, which in the management's
opinion will provide the  necessary  capital to continue its  operations.  These
steps included: 1) the settlement of certain matters of litigation and disputes;
2) exchange of its interests in Peony Gardens for  investment  securities  which
were  subsequently  exchanged for the  investment in GoCall Inc.; 3) completed a
private  placement with PYR Management,  LLC and received  $2,743,000 on January
27, 2000; 4) signed a Investment  Agreement  with Swartz  Private  Equity,  LLC,
which agreed to purchase from time to time, up to $35,000,000  Hartcourt  shares
of common stock.  The  Investment  Agreement with Swartz is still subject to the
approval of SEC; 5) raised $1,301,870 in cash through the issuance of its common
shares upon exercise of an equal number of warrants.

     Operating  activities.  During the six  months  ended  June 30,  2000,  the
Company  had a net loss of  $2,551,510.  Net cash used by  operating  activities
increased  to $873,872  during the six months  ended June 30,  2000  compared to
$541,052 during the same period in 1999. This is primarily due to the funding of
increase in losses.

     Investing activities.  Net cash used in investing activities during the six
months ended June 30, 2000 was primarily due to advancing  $300,000  towards the
purchase of eMPACT, advances to Sino Bull for investment purposes of $2,126,440,
and purchase of property and equipment for $70,982.


                                      F-22
<PAGE>
     Financing activities.  Net cash provided by financing activities during the
six months ended June 30, 2000 was  primarily  due to proceeds  from issuance of
common  shares and  exercise of options and  warrants  amounting  to  $4,574,870
offset by advances to related  parties of $449,808 and payments on notes payable
of $594,882.

     As a result of the above activities, the company experienced a net increase
in cash of  $238,346  for the six months  ended June 30,  2000.  The  ability of
Hartcourt  to continue as a going  concern is still  dependent on its success in
obtaining  additional  financing and  fulfilling  its plan of  restructuring  as
outlined above.














































                                      F-23
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES

                                OTHER INFORMATION
                            JUNE 30, 2000 (UNAUDITED)

Part II

Item 1.    LEGAL PROCEEDINGS

     Charles  E.  Hogue  vs.  Hartcourt,  Circuit  Court of the  Ninth  Judicial
Circuit, Orange County, Florida Case No. CIO-2190

     The  litigation  concerns a claim filed on April 8, 2000 against  Hartcourt
for breach of contract for alleged fees due to Charles Hogue  ("plaintiff")  for
introductory  services.  Such  fee was set as a  percentage  of the  transaction
contemplated  and a check of $40,500 for payment in full thereof was tendered to
the plaintiff which the plaintiff  refused  claiming sums far in excess of those
agreed to. Hartcourt's legal counsel has interposed a motion to dismiss the suit
which is pending  before the court and is confident of success in disposition of
this matter.

     ComericaBank of California ("Comerica") vs. Enova. Et al. Superior Court of
California, County of Los Angeles, California. Case No. BC 221594.

     This  litigation  concerns  Hartcourt's  alleged  obligation  as an alleged
guarantor of another entity's  ("Pego") alleged  obligation on a promissory note
that is asserted to be in  non-financial  default.  The plaintiff in that matter
may be the subject of a cross-complaint  by Hartcourt,  which will depend on the
evidence disclosed by documents Harcourt has demanded be produced. The complaint
alleges that Harcourt executed a guarantee of obligation of Pego  (approximately
$925,000) which obligation went into non-financial  default.  Pego expects to be
able to settle with plaintiff and such  settlement  will  eliminate  Hartcourt's
liability.  The prospects for the success of those settlement  negotiations,  as
well as the  approximately  range or amount of any potential  loss by Hartcourt,
are uncertain at this time.

     The Company is party to various claims and legal proceedings arising out of
the normal course of its business.  These claims and legal proceedings relate to
contractual rights and obligations,  employment  matters,  and claims of product
liability.  While there can be no assurance that an adverse determination of any
such  matters  could not have a material  adverse  impact in any future  period,
management does not believe,  based upon information known to it, that the final
resolution of any of these matters will have a material  adverse effect upon the
Company's  consolidated  financial position and annual results of operations and
cash flows.












                                      F-24
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES

                                OTHER INFORMATION
                            JUNE 30, 2000 (UNAUDITED)


Item 2.    CHANGES IN SECURITIES

Not applicable

Item 3.    DEFAULTS UPON SENIOR SECURITIES

Not applicable

Item 4.    SUBMISSION OF MATTERS TO VOTE OF SECURITIES HOLDERS

None

Item 5.    OTHER INFORMATION

None

Item 6.    EXHIBITS AND REPORTS ON FORM 8-K

         a)   Exhibits - None

         b)   Reports on Form 8-K






























                                      F-25
<PAGE>
                 THE HARTCOURT COMPANIES, INC. AND SUBSIDIARIES

                                OTHER INFORMATION
                            JUNE 30, 2000 (UNAUDITED)

                                   SIGNATURES

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


                                                 The Hartcourt Companies, Inc.

Date: August 11, 2000                            By: /s/  Dr. Alan V. Phan
                                                     ---------------------
                                                     Dr. Alan V. Phan
                                                     President & CEO








































                                      F-26