U. S. SECURITIES AND EXCHANGE COMMISSION
                       Washington D. C.  20549

                             FORM 10-QSB


 (MARK ONE)
    [X]   QUARTERLY REPORT UNDER SECTION 13 OR 15(d)OF THE SECURITIES
          EXCHANGE ACT OF 1934

            FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2001.


    [ ]   TRANSITION REPORT UNDER SECTION 13 OR 15 (d)OF THE SECURITIES
          EXCHANGE ACT OF 1934

     FOR THE TRANSITION PERIOD FROM _____________TO _________________



                 Commission File Number   0 - 30164



                        TENSLEEP CORPORATION
           (Name of Small Business Issuer in its charter)


          COLORADO                                       33-0789960
 (state or other jurisdiction of                   (I.R.S. Employer
incorporation or organization)                    Identification No.)

             86025 52nd Avenue, Coachella, CA 92236-2701
         (Address of Principal Executive offices, Zip Code)

                           (888) 443-2656
          (Issuer's Telephone Number, including area code)

     Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past
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 [ ]


     The number of shares outstanding of issuer's only class of Common
Stock, no par value, was 10,732,023 on JUNE 30, 2001.

                               INDEX

PART I.  FINANCIAL INFORMATION. . . . . . . . . . . . . . . . . . .

     Item 1.  Financial Information  . . . . . . . . . . . . . . . .

          Financial Statements for Tensleep Corporation:

              Balance Sheets . . . . . . . . . . . . . . . . . . . .

              Statements of Operations. . . . . . . . . . . . . . . .

              Statements of Shareholders' Eqity  . . . . . . . . . .

              Statements of Cash Flows . . . . . . . . . . . . . . .

              Notes to Finanical Statements. . . . . . . . . . . . .

      Item 2.  Management's Discussion and analysis or Plan of Operations

               Overview . . . . . . . . . . . . . . . . . . . . . . .

               Plan of Operation. . . . . . . . . . . . . . . . . . .

               Discussion and Analysis. . . . . . . . . . . . . . . .

PART II.  OTHER INFORMATION

      Item 1.  Legal Proceedings. . . . . . . . . . . . . . . . . . .

      Item 2.  Changes in Securities. . . . . . . . . . . . . . . . .

      Item 3.  Defaults Upon Senior Securities. . . . . . . . . . . .

      Item 4.  Submission on Matters to Vote of Security-Holders. . .

      Item 5.  Other Information. . . . . . . . . . . . . . . . . . .

      item 6.  Exhibits and Reports on Form 8 - K . . . . . . . . . .


                          PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

      The consolidate financial statements have been prepared by Tensleep
Corporation, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission.  The Company believes that the disclosures
are adequate to make the information presented not misleading when read with
the Company's audited financial statements for the rears ended September 30,
2000 and 1999.  The financial information presented reflects all adjustments,
consisting only of normal recurring adjustments, which are, in the opinion of
management necessary for a fair statement of the results from the periods
presented.


<PAGE>


                      TENSLEEP CORPORATION AND SUBSIDIARIES

                             CONSOLIDATED BALANCE SHEETS

                               JUNE 30, 2001 AND 2000

<TABLE>
<CAPTION>
                                       ASSETS
                                                             2001            2000
                                                         -----------     -----------
<S>                                                      <C>             <C>
CURRENT ASSETS

 Cash                                                    $    77,661     $   347,923
 Prepaid Expenses (See note 15)                               62,500         312,395
 Due from Tensleep Appliance (See note 23)                   111,073          53,899
 License Fee Receivable (See note 19)                              -         100,000
 Royalty Receivable (See note 18)                             47,000          24,965
 Loan Receivable                                              66,000          30,000
                                                         -----------     -----------
      Total Current Assets                                   364,234         869,182
                                                         -----------     -----------
PROPERTY AND EQUIPMENT

 Machines & Equipment                                        102,658         103,778
 Software                                                    172,371         172,371
                                                         -----------     -----------
                                                             275,029         276,149
 Less accumulated depreciation and amortization              274,385         205,789
                                                         -----------     -----------
      Net Property and Equipment                                 644          70,360


OTHER ASSETS

 Discontinued Operations   (See note 20)                     200,000               -
 Investment in China Net & Technologies, Inc., at
                                 equity (See note 2)         818,667       1,718,667
 Investment in Amcor Financial Corp., at equity
                                         (See note 3)      1,332,430       1,400,000
 Investment in Silicon Resources, at cost (See note 4)             -       1,103,800
 Investment in Master Financial                                    -       1,750,000
 License                                                           -          27,236
                                                         -----------     -----------
      Total Other Assets                                   2,351,097       5,999,703
                                                         -----------     -----------

TOTAL ASSETS                                             $ 2,715,975     $ 6,939,245
                                                         ===========     ===========

</TABLE>
<PAGE>

                          TENSLEEP CORPORATION AND SUBSIDIARIES

                               CONSOLIDATED BALANCE SHEETS

                                 MARCH 31, 2001 AND 2000

<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY

                                                             2001            2000
                                                         -----------     -----------
<S>                                                      <C>             <C>
CURRENT LIABILITIES
   Accounts Payable                                      $     3,538     $
   Loan payable to China Net & Technologies, Inc.
                           (See nOTE 6)                        2,291           3,171
   Accrued consulting fees (See note 11)                      75,000               -
   Deferred Income                                                 -           2,291
                                                         -----------     -----------
    Total Current Liabilities                                 80,829           5,462
                                                         -----------     -----------

TOTAL LIABILITIES                                             80,829           5,462


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

   Common stock, $.01 stated value, 50,000,000 shares        107,321          85,583
   authorized 10,732,023 and 8,358,266 shares issued
   and outstanding at March 31, 2001 and 2000,
   respectively

   Treasury stock, 1,000,000 and 0, at cost, for                   -               -
   March 31, 2001 and 2000, respectively

   Additional paid-in capital                              7,151,000       8,347,416

   Note Receivables for common stock                        ( 82,000)              -
   (See note 11 and 16)

   Retained Earnings (Accumulated Deficit)                (4,541,175)     (1,499,216)
                                                         -----------     -----------

TOTAL STOCKHOLDERS' EQUITY                                 2,635,146       6,933,783
                                                         -----------     -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY               $ 2,715,975     $ 6,939,245
                                                         ===========     ===========
</TABLE>
The accompanying notes are an integral part of these statements.

<PAGE>

                             TENSLEEP CORPORATION AND SUBSIDIARIES

                              CONSOLIDATED STATEMENT OF OPERATIONS

                        FOR THE THREE MONTHS ENDED JUNE 30, 2001 AND 2000
<TABLE>
<CAPTION>
                                                             2001            2000
                                                         -----------     -----------
<S>                                                      <C>             <C>
REVENUES
   Design Fees                                           $         -     $    21,000
   License Fees (See note 19)                                      -               -
   Royalty Income (Note 18)                                   47,000          14,566
   Other Income                                                  250               -
                                                         -----------     -----------
                                                              47,250          35,566

EXPENSES
   Advertising                                                   640           1,075
   Automobile expense                                            942             357
   Bank service charges                                           17              35
   Consulting expense                                         80,700          79,500
   Depreciation and Amortization                                   -          22,865
   Dues and subscriptions                                      2,175           1,947
   Filing fees                                                     -               -
   Interest                                                       13             177
   Other expenses                                                559           2,307
   Office supplies                                               199           2,120
   Outside services                                            1,598           4,711
   Payroll & Payroll Taxes                                         -           5,682
   Postage & delivery                                            499             343
   Professional fees                                           6,250          23,657
   Rent                                                          383               -
   Repairs                                                        49               -
   Supplies                                                        -             355
   Taxes                                                         720               -
   Telephone                                                   1,282           1,692
   Travel & Entertainment                                      9,594           9,272
   Utilities                                                       -             191
                                                         -----------     -----------
                                                             105,620         156,286
                                                         -----------     -----------
INCOME (LOSS) FROM OPERATIONS                               ( 58,370)    (   120,720)
                                                         -----------     -----------
OTHER INCOME (EXPENSE)
   Interest Income                                             1,076           1,493
   Income (loss) on equity investments                    (   17,113)              -
   Asset Impairment (See Note 20)                                  -               -
                                                         -----------     -----------
                                                          (   16,037)          1,493
                                                         -----------     -----------
PROVISION FOR INCOME TAXES (See note 22)                           -               -
                                                         -----------     -----------
NET INCOME (LOSS)                                        $(   74,407)    $(  119,227)
                                                         ===========     ===========


EARNINGS PER COMMON SHARE (SEE NOTE 13)                  $     (0.01)    $     (0.02)
                                                         ===========     ===========

</TABLE>

The accompanying notes are an integral part of these statements.

<PAGE>

                             TENSLEEP CORPORATION AND SUBSIDIARIES

                              CONSOLIDATED STATEMENT OF OPERATIONS

                         FOR THE NINE MONTHS ENDED JUNE 30, 2001 AND 2000
<TABLE>
<CAPTION>
                                                             2001            2000
                                                         -----------     -----------
<S>                                                      <C>             <C>
REVENUES
   Design Fees                                           $         -     $    21,000
   License Fees (See note 19)                                      -         950,000
   Royalty Income (Note 18)                                   81,564          86,886
   Other Income                                                  691           1,556
                                                         -----------     -----------
                                                              82,255       1,059,442

EXPENSES
   Advertising                                                 1,435          68,650
   Automobile expense                                          3,387           2,972
   Bank service charges                                          229             280
   Consulting expense                                        321,700         323,333
   Depreciation and Amortization                              45,731          68,596
   Dues and subscriptions                                      2,385           2,332
   Filing fees                                                     -             950
   Insurance                                                       -           1,539
   Interest                                                      360             295
   License & permits                                               -              50
   Other expenses                                              4,678           2,813
   Office supplies                                               677           2,209
   Outside services                                           14,190          26,247
   Payroll & Payroll Taxes                                     6,742           5,682
   Postage & delivery                                          1,112           1,160
   Professional fees                                          47,206          28,642
   Rent                                                        1,463               -
   Repairs                                                       710           1,053
   Supplies                                                    2,722           1,089
   Taxes                                                       1,952               -
   Telephone                                                   3,074           5,360
   Travel & Entertainment                                     23,104          25,183
   Utilities                                                       -             670
                                                         -----------     -----------
                                                             482,857         569,105
                                                         -----------     -----------
INCOME (LOSS) FROM OPERATIONS                               (400,602)        490,337
                                                         -----------     -----------
OTHER INCOME (EXPENSE)
   Interest Income                                             5,133           1,493
   Income (loss) on equity investments                    (1,108,806)              -
   Asset Impairment (See Note 20)                           (300,000)
                                                         -----------     -----------
                                                          (1,403,673)          1,493
                                                         -----------     -----------
PROVISION FOR INCOME TAXES (See note 22)                           -               -
                                                         -----------     -----------
NET INCOME (LOSS)                                        $(1,804,275)    $   491,830
                                                         ===========     ===========


EARNINGS PER COMMON SHARE (SEE NOTE 13)                  $     (0.19)    $      0.07
                                                         ===========     ===========

</TABLE>

The accompanying notes are an integral part of these statements.


<PAGE>

                         TENSLEEP CORPORATION & SUBSIDIARIES

              CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

                     F0R THE YEARS ENDED SEPTEMBER  30, 2000, 1999
                          AND NINE MONTHS ENDING JUNE 30, 2001

<TABLE>
<CAPTION>
                                                                                                       Allowance
                                                                                                    for Unrealized
                                                                                              Note      Gains and
                                                                   Additional              Receivable  Losses on
                      See             Number of             Common   paid-in     Retained      for     Marketable
                      Note   Date      shares    Considera   stock   capital     Earnings     stock   Equity Sec         Total
                      -----------------------------------------------------------------------------------------------------------
<S>                   <C> <C>       <C>         <C>        <C>       <C>        <C>          <C>        <C>          <C>
Balance 9/30/1998
  as prev. reported                  6,103,016             $  61,030 $  535,186 $(1,780,930) $       -  $         -  $ (1,184,714)
Adjustments:
  Prior prd adj                                                    -          -     (32,205)         -            -       (32,205)
  cost to equity
  method - Note 2                    ---------  ---------- --------- ---------- ------------ ---------  -----------  -------------

Balance, 10/1/1998
  as restated                        6,103,016             $  61,030 $  535,186 $(1,813,135) $       -  $         -  $ (1,216,919)

Stock issued          7A  12/15/98      35,000   Cash/Note       350    174,650           -          -            -       175,000
Stock issued          7B  12/15/98       8,000   Non-cash         80     39,920           -          -            -        40,000
Stock issued          7C  12/15/98     300,000   Non-cash      3,000  1,497,000           -          -            -     1,500,000
Stock issued          7B  12/15/98       4,000   Non-cash         40     19,960           -          -            -        20,000
Stock issued          7B  12/15/98       4,000   Non-cash         40     19,960           -          -            -        20,000
Stock issued          7B  12/15/98       4,000   Non-cash         40     19,960           -          -            -        20,000
Stock issued          7B  12/15/98       4,000   Non-cash         40     19,960           -          -            -        20,000
Stock issued          7D  12/15/98       4,000   Non-cash         40     19,960           -          -            -        20,000
Stock issued          7E  12/15/98     137,000    Note         1,370    683,630           -          -            -       685,000
Exercise A Warrants   7E  12/15/98      88,000    Note           880     34,320           -          -            -        35,000
Exercise B Warrants   7F  03/31/99       4,000   Non-cash         40     19,960           -          -            -        20,000
Exercise A & B Warr   7G  09/13/99     350,000   Non-cash      3,500    496,500           -          -            -       500,000
Note Rec for stock    16                     -                                -           -   (610,200)           -      (610,200)
Net income (loss)
        1999                                  -                               -   ( 253,242)         -            -      (253,242)
                                      ---------  --------- --------- ---------- ------------ ---------- ------------ -------------
Balance 9/30/1999                     7,045,016            $  70,450 $3,580,966 $(2,066,377) $(610,200) $         -  $    974,839

Exercise B Warrants   7H  10/11/19       15,000  Non-cash        150     74,850           -          -            -        75,000
Exercise A Warrants   7I  10/26/19       20,000  Non-cash        200     19,800           -          -            -        20,000
Stock issued          7J  10/29/19       35,000  Non-cash        350     27,650           -          -            -        25,000
Exercise A Warrants   7K  11/01/19        5,000   Cash            50      3,950           -          -            -         4,000
Exercise A Warrants   7L  11/03/19        1,000   Cash            10        790           -          -            -           800
Exercise A Warrants   7M  11/03/19        1,000   Cash            10        790           -          -            -           800
Exercise A Warrants   7N  12/07/19       10,000  Non-cash        100      7,900           -          -            -         8,000
Exercise A Warrants   7O  12/07/19       50,000  Non-cash        500     49,500           -          -            -        50,000
Exercise A Warrants   7P  12/07/19       13,000  Non-cash        130     12,870           -          -            -        13,000
Stock issued          7Q  12/08/19       60,000  Non-cash        600     59,400           -          -            -        60,000
Erercise B Warrants   7R  12/13/19       25,000  Non-cash        250    122,250           -          -            -       122,500
Stock issued          7S  12/14/19       20,000   Cash           200     35,282           -          -            -        35,482
Exercise B Warrants
    & stock issued    7T  12/30/19      300,000  Non-cash      3,000    597,000           -          -            -       600,000
Erercise B Warrants   7U  12/30/19       50,000  Non-cash        500    249,500           -          -            -       250,000
Exercise A Warrants   7V  12/30/19      253,960  Non-cash      2,540    197,460           -          -            -       200,000
Exercise A Warrants   7W  12/30/19      100,000  Non-cash      1,000     79,000           -          -            -        80,000
Shares cancelled      7X  12/30/19   (1,000,000) Non-cash   (10,000)     10,000           -          -            -             -
Note Rec canceled     16  12/30/19            -  Non-cash          -          -           -    610,200            -       610,200
Stock issued          7Y  02/24/20      340,000  Non-cash      3,400     30,600           -          -            -        34,000
Erercise B Warrants   7Z  03/07/20      100,000   Cash         1,000    449,000           -          -            -       450,000
Stock issued          7AA 04/22/20      400,000  Non-cash      4,000    996,000           -          -            -     1,000,000
Exercise B Warrants
    & stock issued    7AB 04/22/20      500,000  Non-cash      5,000  1,245,000           -          -            -     1,250,000
Stock issued          7AC 06/07/20       10,000  Non-cash        100     14,275           -          -            -        14,375
Stock dividend        14  06/02/20        4,290  Non-cash         43      5,856      (5,856)         -            -             -
Stock dividend        14  07/26/20       49,737  Non-cash        497     64,783     (65,280)         -            -             -
Stock dividend        14  08/23/20        4,020  Non-cash         40      3,728     ( 3,768)         -            -             -
Net income for 2000                           -                    -          -    (265,868)         -            -      (265,868)
Net Unrealized loss
  on marketable
  equity securities                           -                    -          -           -          -      (41,468)      (41,468)
                                      ---------             --------  ---------   ---------  ---------  -----------    -----------

Balance 9/30/2000                     8,412,023             $ 84,120 $7,938,200 $(2,407,192) $       -  $   (41,468)   $5,573,660

Stock Issued          7AD 11/10/20      820,000  Non-cash      8,200     73,800           -          -            -        82,000
Stock Issued          7AE 03/07/01    1,000,000  Non-cash     10,000     90,000           -          -            -       100,000
Recission Writedown   7AF 03/31/01            -                    -   (996,000)          -          -            -      (996,000)
Stock Issued          7AG 04/16/01      500,000  Cash          5,000     45,000           -          -            -        50,000
Note for stock        16                      -                    -          -           -   ( 82,000)           -      ( 82,000)
Net Loss for period                           -                    -          -  (1,804,673)         -            -    (1,804,673)
Adjustment Prior Pd                           -                    -          -    (329,309)         -       41,468     ( 287,841)
                                      ---------             --------  ---------   ---------  ---------  -----------    -----------

Balance03/31/2001                    10,232,023             $107,320 $7,151,000 $(4,541,174) $( 82,000) $        -     $2,635,146

</TABLE>








The accompanying notes are an integral part of these statements.


<PAGE>

                      TENSLEEP CORPORATION AND SUBSIDIARIES

                       CONSOLIDATED STATEMENT OF CASH FLOWS

                   FOR THREE MONTHS ENDING JUNE 30, 2001 AND 2000



<TABLE>
<CAPTION>
                                                             2001            2000
                                                         -----------     -----------
<S>                                                      <C>             <C>
CASH FLOW FROM OPERATING ACTIVITIES
   Net Income (Loss)                                     $(   74,402)    $    16,145

   Adjustments to reconcile net loss to
            net cash used in operations:
     Depreciation and amortization                                 -          22,865
     Expenses (income) incurred in exchange for stock              -               -
     Discontinued Operations - Adjustments                         -               -
     Non cash expense for Silicon Resources                        -               -

     (Increase) decrease in assets:
      Non - cash Income                                            -               -
      Prepaid expenses                                        62,500          62,500
      Accounts Receivable                                          -          57,957
      Royalty Receivable                                     (32,183)              -
      Loan Receivable                                          3,800         (30,000)

     Increase (decrease) in liabilities:
      Accounts Payable                                       (21,178)         15,017
      Accrued consulting fees                                      -               -
      Deferred Income                                              -         (10,601)
                                                         -----------     -----------
   Net cash used by operating activities                    ( 61,463)        133,883
                                                         -----------     -----------
CASH FLOWS FROM INVESTING ACTIVITIES

   Advances to affilate                                      ( 7,820)              -
   Investment In Marketable Securities                             -         (19,853)
   Purchase of Property and Equipment                              -         ( 1,765)
   Non-Cash Reduction in value - Amcor Financial             (82,887)              -
   Purchase of Technology License                                  -         (13,790)
   Loan to Nationwide Residential Capital                    (50,000)
   Discontinued Operations - Net                                   -              -
   Loss on sale of Silicon Resources                               -               -
   Recission of Agreement                                          -              -
                                                         -----------     -----------
   Net cash used by investing activities                    (140,707)       ( 35,408)
                                                         -----------     -----------
CASH FLOWS FROM FINANCING ACTIVITIES
   Note of Sale of Stock                                     100,000               -
   Borrowings from Corporate Finance Co.                           -               -
   Proceeds from Stock Sale                                   50,000          23,999
                                                         -----------     -----------
   Net cash provided by financing activities                 150,000          23,999
                                                         -----------     -----------
NET INCREASE (DECREASE) IN CASH                              (52,170)        122,474

CASH, beginning of period                                    129,831         417,219
                                                         -----------     -----------
CASH, end of period                                      $    77,661     $   539,693
                                                         ===========     ===========

</TABLE>

The accompanying notes are an integral part of these statements.


<PAGE>

                      TENSLEEP CORPORATION AND SUBSIDIARIES

                       CONSOLIDATED STATEMENT OF CASH FLOWS

                   FOR NINE MONTHS ENDING JUNE 30, 2001 AND 2000



<TABLE>
<CAPTION>
                                                             2001            2000
                                                         -----------     -----------
<S>                                                      <C>             <C>
CASH FLOW FROM OPERATING ACTIVITIES
   Net Income (Loss)                                     $(1,804,274)    $   752,638

   Adjustments to reconcile net loss to
            net cash used in operations:
     Depreciation and amortization                            45,731          69,626
     Expenses (income) incurred in exchange for stock              -         211,907
     Discontinued Operations - Adjustments                         -               -
     Non cash expense for Silicon Resources                        -        (103,800)
     Income earned in exchange for stock                           -         (65,000)

     (Increase) decrease in assets:
      Non - cash Income                                            -        (750,000)
      Prepaid expenses                                       187,500         197,605
      Accounts Receivable                                     88,291         (21,165)
      Royalty Receivable                                           -               -
      Loan Receivable                                        (36,000)        (30,000)

     Increase (decrease) in liabilities:
      Accounts Payable                                         3,032          12,471
      Accrued consulting fees                                 75,000        (140,000)
      Deferred Income                                              -               -
                                                         -----------     -----------
   Net cash used by operating activities                  (1,440,720)        134,282
                                                         -----------     -----------
CASH FLOWS FROM INVESTING ACTIVITIES

   Advances to affilate                                      (61,073)        (53,899)
   Purchases of Machinery & equipment                           (645)         (1,765)
   Non-Cash Reduction in value - China Net                   853,468               -
   Investment in CFC                                               -         (50,000)
   Investment in Shanghai Co                                       -        (112,000)
   Investment in Tradeable Securities                              -         (19,835)
   Purchase of Technology License                                  -         (18,790)
   Non-Cash Reduction in value - Amcor Financial             (48,662)
   Reduction of Goodwill - Master Financial                  500,000               -
   Non-cash exchange for Equipment                                 -          18,100
   Discontinued Operations - Net                            (200,000)              -
   Loss on sale of Silicon Resources                       1,103,800               -
   Recission of Agreement                                   (787,200)              -
                                                         -----------     -----------
   Net cash used by investing activities                   1,359,688        (238,189)
                                                         -----------     -----------
CASH FLOWS FROM FINANCING ACTIVITIES
   Loan payments (Loans) on Stock Purchase                  ( 82,000)         60,000
   Borrowings from Corporate Finance Co.                           -         (12,568)
   Proceeds from exercise of warrants                              -         596,103
   Non-cash Sale of Stock                                     23,200
                                                         -----------     -----------
   Net cash provided by financing activities                ( 58,800)        643,535
                                                         -----------     -----------
NET INCREASE (DECREASE) IN CASH                              139,832         539,628

CASH, beginning of period                                    217,493              65
                                                         -----------     -----------
CASH, end of period                                      $    77,661     $   539,693
                                                         ===========     ===========

</TABLE>

The accompanying notes are an integral part of these statements.



<PAGE>

                                TENSLEEP C0RPORATION

                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                                   JUNE 30, 2001



ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

Tensleep Corporation (formerly Tensleep.com, Inc., Tensleep Technologies, Inc.
and Tensleep Design, Inc.)  (A Colorado Corporation) (The Company) is a
company that acquires and licenses technology; identifies, acquires, and
develops, development stage technology and service companies that focus on
the Internet, energy and communications products and services.  The Company
is located in Austin, Texas.

Consolidation Policy

The consolidated financial statements include the accounts of The Company and
all of its wholly owned and majority-owned subsidiaries.  All intercompany
transactions and balances have been eliminated.  The Company's investments in
17% to 50% owned affiliates in which it has the ability to exercise significant
influence over operating and financial policies are accounted for using the
equity method.  Accordingly, the Company's share of the earnings of these
companies is included in consolidated net income.  Investments in other
companies are carried at cost.

Development Stage Company

The Company was formed on October 23, 1997 and was in the development stage
through September 30, 1999.  During this period of time the Company did not
generate any income from operations.  The Company's activities were devoted to
raising capital and obtaining financing. The year ending September 30,
2000 is the first fiscal year during which the Company began active operations
pertaining to technology and license agreements.

Product Development Costs

Product development costs are expensed as incurred.  At September 30, 2000
such costs were approximately $96,000.  Prior to commencing operations the
Company incurred research and development costs which were also charged to
operations when incurred.  Research and development costs were $0 for the three
months ending June 30, 2001 and 2000.

Marketable Securities

Marketable Securities currently consist of common stock.  Marketable
securities are stated at market value as determined by the most recently
traded price of each security at the balance sheet date.  The Company's
investment in marketable equity securities are held for an indefinite period
and thus are classified as available for sale.  Available-for-sale securities
are carried at fair value, with the unrealized gains and losses, net of tax,
reported as a separate component of stockholders' equity.  The cost of
investments sold is determined on the specific identification or the first-in-
first out method.

Cash and Cash Equivalents

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

Concentration of Credit Risk

The Company maintains its operating cash accounts at commercial banks in
California, Texas and Minnesota.  The accounts at the banks are guaranteed by
the Federal Deposit Insurance Corporation (FDIC) up to $100,000 per bank.  At
times some accounts may exceed FDIC limits.  The Company limits the amount of
credit exposure with any one financial institution and believes that no
significant concentration of credit risks exists with respects to cash and cash
equivalents.

Property and Equipment, Depreciation and Amortization

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

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

		Machinery & Equipment		3 years
		Software			      3 years

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

Goodwill, which represents the excess of the cost of purchased companies over
the fair value of the underlying net assets at dates of acquisition, is being
amortized over a 10 year period.

Use of Estimates

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect certain reported amounts and disclosures. Accordingly, actual
results could differ from those estimates.

Fair Value of Financial Instruments

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

Income Taxes

Income Taxes are recognized during the year in which transactions enter into
the determination of consolidated financial statement income, with deferred
taxes being provided for temporary differences between amounts of assets and
liabilities for financial report purposes and such amounts as measured by tax
laws.  See Note 22.

The consolidated financial statements of the Company include a provision for
(benefit from) income taxes based on the consolidated results of operations for
the parent company and its subsidiaries.  As of September 30, 2000 adequate
detailed books and records and supporting data for the subsidiary Master
Financial Group, Inc. were not available and as such the impact on consolidated
accrued income taxes and income tax expense could not be determined.  For
consolidated financial reporting purposes the provision for income taxes using
the consolidated results of operations was offset through the utilization of
the parent company's net operating loss carryover.


Adjustments

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

Advertising

Advertising costs, except for costs associated with direct-response
advertising, are charged to operations when incurred. The costs of direct-
response advertising, if any, are capitalized and amortized over the period
during which future benefits are expected to be received.

Note Receivable for common stock

The Company reports notes received in payment for the Company's stock as a
deduction from stockholders' equity (deficit).  A note will be recorded as an
asset if collected in cash prior to the issuance of the financial statements.

NOTE 1: MARKETABLE SECURITIES


The Company as of June 30, 2001 owns a limited amount of marketable
securities in its discontinued operations of Master Financial Group, Inc.,
and is included in the valuation of Discontinued Operations.  See Note 20.

NOTE 2: INVESTMENT IN CHINA NET & TECHNOLOGIES, INC.

In 1997 the Company acquired 80,000 shares of China Net & Technologies, Inc.
(formerly Corporate Finance Company)  ("CN&T") common stock valued at
$200,000 or $2.50 per share.  CN&T is an affiliate company.  CN&T is a high-
technology and Internet-related company that specializes in developing
strategic relationships with emerging-growth, high-technology companies in
China.  CN&T has acquired a license to manufacture and distribute the
Company's Web-modem in China and is seeking Chinese companies to manufacture
and distribute that product.  In 1999 the Company acquired an additional
80,000 shares (see note 5) also valued at $200,000 or $2.50 per share. In 1998
the Company sold 800 shares of CN&T common stock for $2,000 to unrelated
parties. The proceeds from the sale were given directly to CN&T to reduce the
Company's loan payable to CN&T.  In April 2000 the Company entered into an
agreement with CN&T to license technology to it on a case by case basis, where
CN&T will engage in joint ventures with Chinese Company's for the manufacture
of and distribution of electronic products and developing and maintaining web-
sites for business-to-business and business-to-consumers in China.  The Company
licensed its "web-modem" to CN&T to manufacture the product and distribute it
in China.  As part of this agreement the Company exchanged 400,000 shares
valued at $1,000,000 or $2.50 per share of restricted common stock for
2,000,000 shares of CN&T restricted common stock.  In addition CN&T issued the
Company 500,000 shares of its restricted common stock to reimburse the Company
for promotional services valued at $320,667, for a total initial investment of
$1,718,667.  In March 2001 the Company and China Net agreed to modify the
agreement to exchange 400,000 shares of the Company's common stock for 2,000,000
shares of China Net's common stock. Under the modified agreement the 2,000,000
shares of China Net were canceled.  In exchange for the 400,000 shares of the
Company and the receipt of China Net common stock in payment of the remaining
$100,000 license fee, China Net will issue the Company 500,000 shares of stock.
A major shareholder of the Company is also a major shareholder of CN&T.

NOTE 3: INVESTMENT IN AMCOR FINANCIAL CORP.

During fiscal year 2000 the Company acquired 700,000 shares in Amcor
Financial Corp. (Amcor).  Amcor is a specialty finance company providing
merchant banking services in the form of real estate financing and financing of
emerging growth companies.  A major shareholder of the Company is also a major
shareholder of Amcor.  Shares acquired represent approximately a 17% ownership
in Amcor.  Based on the 17% ownership interest in Amcor and since the Company
can exercise significant influence over Amcor's operating and financial
activities,  the Company has accounted for the investment under the equity
method. Under the equity method, the Company records its proportionate share of
the earnings of Amcor.  The shares were obtained in cash-free exchanges.  The
valuation of the shares obtained was an agreed-upon value as of the date of the
exchange based upon the market value of the Company's common stock on the
closing date.

The Company exchanged 300,000 shares of its common stock (100,000 shares by the
exercise of 100,000 Class B Warrants and 200,000 shares of common stock) for
300,000 shares of Amcor  valued at $600,000.  The Company also exchanged
253,960 shares (253,960 shares by the exercise of 253,960 Class A Warrants) for
100,000 restricted shares of Amcor common stock valued at $200,000.  In
addition the Company received an additional 300,000 shares of Amcor common stock
from R Tucker and Associates (A related entity) valued at $600,000 in
cancellation of a note receivable owed to the Company from R Tucker and
Associates.  For a total initial investment of $1,400,000.  The impact of the
equity method on this investment for the period ending September 30, 2000 was
a reduction of $116,232 resulting from certain losses and amortization.

At September 30, 2000, the investment in Amcor as adjusted for the equity
method exceeded the Company's share of the underlying net assets by 616,062
which amount is being amortized on the straight line method over 10 years, with
an amortization of $34,226 for the six months endig March 31, 2001.

NOTE 4: INVESTMENT IN SILICON RESOURCES

During the previous fiscal year the Company acquired 1,900,452 shares in
Silicon Resources.  Shares acquired represent approximately an 35% ownership
in Silicon Resources.  Silicon Resources provides integrated circuit design
consulting services.  The Company has accounted for this investment under the
cost method because the Company has not been able to get the necessary
financial information to apply the equity method. Under the cost method,
income is recorded when dividends are received. The shares were obtained in the
cash-free exchanges described in Note 5 and 12.  The valuation of the shares in
the amount of $1,103,800 was obtained was an agreed-upon value as of the date
of the exchange based upon the market value of the Company's common stock on
the closing date.  In March 2001 the Company sold its interest in Silicon
Resources to an affiliate for $3,800.  (See Note 21).

NOTE 5: NON CASH TRANSACTIONS

As explained in Note 2, the original investment of 80,000 shares of China Net &
Technologies, Inc. (formerly Corporate Finance Company) in 1997 was obtained in
exchange for 1 million investment units. Each unit is composed of one share of
common stock and one warrant to purchase one share of common stock at a
specified price. The Company obtained an additional 80,000 shares of China Net
& Technologies, Inc. in 1999 from R Tucker and Associates in exchange for a
$200,000 reduction to a note receivable owed to the Company by R Tucker and
Associates.

In April 2000 the Company entered into an agreement with CN&T to
license technology to it on a case by case basis, where CN&T will engage in
joint ventures with Chinese Company's for the manufacture of and distribution
of electronic products and developing and maintaining web-sites for business-
to-business and business-to-consumers in China.  The Company licensed its "web-
modem" to CN&T to manufacture the product and distribute it in China.  As part
of this agreement the Company exchanged 400,000 shares valued at $1,000,000 or
$2.50 per share of restricted common stock for 2,000,000 shares of CN&T
restricted common stock (this agreement was modified.  See Note 2).
In addition CN&T issued the Company 500,000 shares of its restricted common
stock to reimburse the Company for promotional services valued at $320,667.

As explained in Note 3 the Company acquired 700,000 shares of Amcor in exchange
for stock and warrants and cancellation of a note receivable.

As explained in Note 4 and 12 the Company acquired 1,900,452 shares of Silicon
Resources valued at $1,103,800.  The Company agreed to exchange 50,000 shares
from the exercise of 50,000 Class B Warrants (unrestricted common stock) valued
at $250,000, cancel a note in the amount of $103,800 owed to the Company for an
equipment lease and a one time non-exclusive license fee with a value of
$750,000.

As explained in Note 7B, the Company issued 24,000 shares of common stock to
pay off $120,000 in accrued consulting fees.

As explained in Note 7C, the Company issued 300,000 shares of common stock to
pay off $1,500,000 in debt.

As explained in Note 7D, the Company exchanged 4,000 shares of common stock for
advertising. The common stock was valued at the agreed-upon price of $20,000,
or $5.00 per share.

As explained in note 7F the Company exchanged 4,000 shares from the exercise of
4000 class B warrants for advertising and promotional services. The common
stock was valued at the agreed-upon price of $20,000, or $5.00 per share.

As explained in note 7G the Company exchanged 300,000 shares from the exercise
of 300,000 Class A warrants and 50,000 shares from the exercise of 50,000 Class
B warrants for advertising and promotional services.  The common stock was
valued at the agreed-upon price of $500,000.

NOTE 6: LOAN PAYABLE TO CHINA NET & TECHNOLOGIES, INC.

China Net & Technologies, Inc. (formerly Corporate Finance Company) has loaned
the Company certain funds to cover operating expenses.  The balance due on the
loan is $2,291 and $17,150 as of March 31, 2001 and 1999 and is covered by
a non-interest bearing demand note.

NOTE 7:  CAPITAL FUNDING

In 1997 the Board of Directors authorized private offerings pursuant to
Regulation S, Section 3(b) and/or 4(2) of the Securities Act of 1933, as
amended.  In 1997 and 1998 the Company issued 1 million investment units to
China Net & Technologies, Inc. pursuant to Regulation D, Rule 504 and 500,000
investment units to R Tucker and Associates, Inc. and Sundance Design, Inc.
pursuant to Regulation A.  During fiscal year 2000, October 1, 1999 to
September 30, 2000 the Company's common stock commenced trading on the Over-
the-Counter Bulletin Board (TENS).  The following summarizes the various stocks
and warrant transactions as reported in the accompanying Statement of Changes
in Stockholders' Equity for periods October 1, 1998 and 1999, through September
30, 1999 and 2000 and October 1, 2000 through June 30, 2000.

     Note A - 35,000 shares of common stock were sold for $175,000.  The Company
received $25,000 in cash and promissory notes in the amount of $155,000.   One
of the promissory notes received was for $50,000 and R Tucker & Associates was
the payee (see note E).

	Note B - 24,000 shares of common stock were issued for $120,000 to pay off
accrued consulting fees.

	Note C - 300,000 shares of common stock were issued for $1,500,000 to pay off
the convertible note, which was issued in exchange for fixed assets of $172,948
and Research & Development expenses of $1,327,052.

	Note D - 4,000 shares of common stock were issued for $20,000 in exchange for
advertising.

	Note E - 137,000 shares of common stock were issued for $685,000 and 88,000
Class A warrants exercised in exchange for a $765,200 promissory note, secured
by 200,000 shares of common stock. The $765,200 note included $50,000 resulting
from the cancellation of a $50,000 note previously issued by R Tucker &
Associates to an unrelated party in an unrelated transaction.

	Note F - 4,000 Class B warrants were exercised for $20,000 in exchange for
advertising and promotional services in accordance with a contract for
advertising that expired on March 31, 2000.

	Note G - 300,000 Class A warrants and 50,000 Class B warrants were exercised
for $500,000 in exchange for advertising and promotional services for the
years ending September 30, 2000 and 2001.

	Note H - 15,000 Class B warrants were exercised for $75,000 in exchange for
promotional services performed for China Net & Technologies, Inc. (a related
entity) over 6 months commencing October 11, 1999 through April 10, 2000.

	Note I - 20,000 Class A warrants were exercised for $20,000 in exchange for
advertising services to be performed over three months commencing October 28,
1999 through January 24, 2000.

	Note J - 35,000 Class A warrants were exercised for $28,000 in exchange for
advertising services to be performed over six months commencing October 29,
1999 through April 29, 2000.

	Note K - 5,000 Class A warrants were exercised for cash at $.80 per share.
The cash from these warrants was deposited into the Company's checking account.

	Note L - 1,000 Class A warrants were exercised for cash at $.80 per share.
The cash from these warrants was deposited into the Company's checking account.

	Note M - 1,000 Class A warrants were exercised for cash at $.80 per share.
The cash from these warrants was deposited into the Company's checking account.

	Note N - 10,000 Class A warrants were exercised for $8,000 in exchange for
consulting services.

	Note O - 50,000 Class A warrants were exercised for $50,000 in exchange for a
partial payment owed to China Net & Technologies, Inc. for accrued consulting
fees.

	Note P  - 13,000 Class A warrants were exercised for $13,000 in exchange for a
partial payment owed to China Net & Technologies, Inc. for accrued consulting
fees.

      Note Q - 60,000 restricted shares were issued in exchange for consulting
services to be performed over 30 days and valued at $60,000.

	Note R - 25,000 Class B warrants were exercised for $122,500 in exchange for
consulting services performed for China Net & Technologies, Inc. (a related
entity) to be performed over three months

	Note S - 20,000 Class A warrants were exercised for an aggregate value of
$35,200. The cash from these warrants was deposited into the Company's checking
account.

       Note T - 100,000 Class B warrants were exercised and 200,000 shares were
issued for $600,000 in exchange for 300,000 shares of Amcor's common stock.

	Note U - 50,000 Class B warrants were exercised for $250,000, a note in the
amount of $103,800 owed to the Company for an equipment lease was canceled, and
a one time non-exclusive license fee with a value of $750,000 was exchanged for
1,900,452 shares of Silicon Resources (See Note 4).

	Note V - 253,960 Class A warrants were exercised for $200,000 in exchange for
100,000 shares of Amcor.

	Note W - 100,000 Class A warrants were exercised for $80,000 in exchange for
services performed for China Net & Technologies, Inc. (a related entity) to
be performed over the next year.

	Note X - 1,000,000 shares of the Company's common stock was contributed to
the Company, canceled, and returned to the Company's authorized but unissued
shares.

	Note Y - 340,000 restricted shares valued at $34,000 were issued in exchange
for services performed for China Net & Technologies, Inc. (a related entity).

	Note Z - 100,000 Class B warrants were exercised to a related party for cash
at $4.50 per share. The cash from these warrants was deposited into the
Company's checking account.

	Note AA -  400,000 shares of common stock were exchanged for 2,000,000
restricted shares of common stock in China Net & Technologies, Inc.

	Note AB - 500,000 shares of common stock were exchanged for all the issued
and outstanding common stock of Master Financial, Inc.

	Note AC - 10,000 shares were issued to a chip designer as a signing bonus.

	Note AD - 820,000 shares were issued to officer's and directors in exchange
for promissory notes equaling $82,000.

	Note AE - 1,000,000 shares were issued in exchange for a promissory note
equal to $100,000.

      Note AG - 500,000 shares were issued for the payment of $50,000 cash per
exercise of 500,000 options at $.10 per share.

NOTE 8:  STOCK OPTION PLANS

The Company has adopted a stock option plan pursuant to Section 422A of the
Internal Revenue Code and a non-incentive stock option plan. This plan
grants options that can be exercised at a specified price. The Company has
resolved that 3,000,000 shares of common stock be reserved for this plan. The
Company discard the previous plan and canceled the options issued under it.

NOTE 9: WARRANTS

As part of its funding activities, the Company has issued warrants for the
purchase of common stock. Additional warrants may be issued in the future
during additional offerings.  As of March 31, 2001, the following warrants
were outstanding:

	Class B: one warrant can purchase one common share

        R Tucker and Associates - 21,000 warrants at $4.50 per share
        George N. Haddad        - 35,000 warrants at $4.50 per share

The warrants expire on May 31, 2002.  The Company has the right to call the
unexercised Class B Warrants before their expiration date at a price of 10
cents per warrant provided the bid price for the Company's common stock for
10 consecutive trading days is $5.50 or more.

NOTE 10: RISKS AND UNCERTAINTIES

As discussed in "Organization and Summary of Significant Accounting
Policies", the Company was in the development stage from its inception on
October 23, 1997 to September 30, 1999. Realization of a major portion of the
assets is dependent upon the Company's ability to meet its future financing
requirements, and the success of capital funding and future operations. These
factors raise substantial doubt about the Company's ability to continue as a
going concern.

The Company has commenced a plan of strict limits on and control over costs,
expenses, compensation and capital expenditures.

The investments in marketable securities are held available-for-sale. The
Company currently has no marketable securities.  Any investments in
marketable securities will subject to the hazards of trading equities on the
open market. The account will experience growth and loss in varying amounts
depending on the performance of the securities traded.

NOTE 11: RELATED PARTY TRANSACTIONS

A director of the Company is also a director and major shareholder of R Tucker
& Associates, Amcor Financial Corp. and China Net & Technologies, Inc.
(formerly Corporate Finance Company). Transactions between the Company and
these entities above have been described in Notes 2 and  3.

In November 1997 the Company issued 1,000,000 investment units to a related
party in exchange for 80,000 shares of CN & T's common stock (See Note 2).

In December 1998 R Tucker & Associates, a related party, issued a promissory
note for $765,200 to the Company in exchange for 137,000 shares of common stock
and 88,000 shares from the exercise of Class A warrants and the cancellation
of a $50,000 note previously issued (See note 7E).

The accrued consulting fee as of December 31, 1999 is payable to China Net &
Technologies, Inc. for services performed by Dennis Kaliher and Ronald S.
Tucker.  This liability was canceled during the current fiscal year in exchange
for 63,000 shares of common stock (See note 7O&P) valued at $63,000, a cash
payment of $66,800 and a $10,200 reduction in a note receivable from an
affiliated company (See note 3).

In March 1999 the Company reduced a Note Receivable from R. Tucker and
Associates in exchange for 80,000 shares of common stock in China Net &
Technologies, Inc. valued at $200,000 (See note 2). In December 1999 the
Company issued China Net & Technologies, Inc. 100,000 shares of common stock
valued at $80,000 for promotional services. 	In March 2000 China Net &
Technologies, Inc. issued to the Company 500,000 shares of its restricted
common stock to reimburse the Company for promotional services, and in April
2000 the Company exchanged 400,000 shares of restricted common stock for
2,000,000 shares of China Net & Technologies, Inc. restricted common stock.
The Company also entered into a license agreement with China Net &
Technologies, Inc. to manufacture and distribute its "web-modem" in China.
The license was valued at $200,000.  $100,000 was paid on signing the license
agreement and the balance is due when engineering drawings are delivered for
manufacturing the product.

In December 1999 the Company exchanged shares with Amcor, a related entity,
whose President and a Director is also the President and a Director of the
Company (See note 3).  The Company exchanged 300,000 shares of its common
stock for 300,000 shares of Amcor's common stock valued at $600,000.  	The
Company also exchanged 253,960 shares (the exercise of 253,960 Class A
Warrants) for 100,000 restricted shares of Amcor common stock valued at
$200,000.  In addition the Company received an additional 300,000 shares of
Amcor common stock from R Tucker and Associates (A related entity) valued at
$600,000 in cancellation of a note receivable owed to the Company from
R Tucker and Associates

The accrued consulting fee due by the Company as of March 31, 2001 is
payable to China Net & Technologies, Inc. for services performed by Ronald
S. Tucker valued at $75,000.

In March 2001 the Company issued 1,000,000 shares of its common stock to
Amcor Financial Corp. in exchange for a promissory note in the amount of
$100,000.

NOTE 12: INVESTMENT IN SILICON RESOURCES

On September 1, 1999 the Company began negotiations and entered into an
agreement with Silicon Resources, Inc. to purchase a portion of Silicon
Resources, Inc. a consulting business.  On November 30, 1999 the Company
entered into a modification agreement that was executed and completed during
the current fiscal year with Silicon Resources, Inc. modifying the agreement
entered into on September 1, 1999.  Under the terms of the modification
agreement, Silicon Resources and the Company entered into a non-exclusive
license agreement for the Company's technology with a value at the time the
agreement was entered into in the amount of $750,000, for which the Company
will receive Silicon Resources, Inc. common stock.  As of the date of this
report the value of the investment in Silicon Resources could not be determined
due to the lack of adequate financial information.  The Company, Ron Tucker,
president, and Silicon Resources, Inc. agreed to exchange 50,000 shares of its
unrestricted common stock, cancel the indebtedness owed to the Company by
Silicon Resources in the amount of $103,800 pursuant to an Equipment lease, and
the license fee in the amount of $750,000 for a total of 1,900,452 shares of
Silicon Resources restricted common stock (See note 4).  In March 2001 the
Company sold its interest in Silicon Resources.

NOTE 13: EARNINGS (LOSS) PER SHARE

As of June 30, 2001 and 2000, the Company had 10,732,023 and 8,358,266
common shares outstanding, respectively, and no preferred shares outstanding.
The earnings (loss) per share amount is based on the weighted average number
of shares actually outstanding.  The number of shares used in the computation
for June 30, 2001 and 2000 was 9,696,467 and 7,440,466 shares
respectively.

NOTE 14: STOCK DIVIDEND

On August 2, 1999 the Board of Directors authorized a 10% stock dividend
payable to those investors who purchase the corporation's common stock in the
open market between August 2, 1999 and October 31, 1999, register the shares
in their name, and are the registered shareholder on July 31, 2000. The shares
to be distributed by August 31, 2000. On October 2, 1999 the Board of
Directors extended the date for purchasing common stock in the open market
from October 31, 1999 to December 31, 1999. On December 1, 1999 the Board of
Directors extended the date for purchasing common stock in the open market
from December 31, 1999 to January 31, 2000 and advanced the record date to
March 31, 2000 from July 31, 2000.

On June, July and August the Company distributed 58,047 shares of common stock
in connection with the 10% stock dividend that was authorized on August 2,
1999. As a result of the stock dividend, common stock was increased by $580,
additional paid in capital was increased by $74,266, and retained earnings was
decreased by $74,946.  All references in the accompanying consolidated
financial statements to the number of common shares and per-share amounts for
December 31, 1999 have been restated to reflect the stock dividend.

NOTE 15: PREPAID EXPENSES

As explained in Note 7F, the Company exercised 4,000 Class B warrants in
exchange for $20,000 in advertising and promotional services for the one year
period from April 1999 to March 2000.  Advertising and promotional services
charged to operations for 2000 and 1999 was $10,000 and $10,000, respectively.

As explained in Note 7G, the Company exercised 300,000 Class A warrants and
50,000 Class B warrants in exchange for $500,000 in advertising and
promotional services for the two year period starting October 1, 1999
(beginning of fiscal year 2000). Advertising and promotional services charged
to operations for fiscal years 2000 was $250,000 and $125,000 for the six
months of fiscal year 2001, leaving $125,000 as a prepaid expense as of
March 31, 2001.

NOTE 16: NOTE RECEIVABLE FOR COMMON STOCK

Also, in December 1998, the Company issued 137,000 shares of common stock and
88,000 Class A warrants were exercised in exchange for a $765,200 note
receivable from a related party.  In March 1999 of the prior year the note was
reduced by $200,000 in exchange for 80,000 shares of common stock in a related
party transaction.  The Company received 300,000 shares of Amcor
common stock from R Tucker and Associates valued at $600,000 (See note 5) and
reduced accrued consulting fees $10,200 from an affiliated company (See note
11).

In November 2000, the Company issued 820,000 shares of common stock in
exchange for $82,000 in notes payable from certain officers and directors.
The notes are reported in the stockholders' equity section.

In March 2001, the Company issued 1,000,000 shares of common stock in
exchange for $100,000 in a note payable from an affiliate.  The note is
reported in the stockholders' equity section.

NOTE 17: NAME CHANGE

In April 1999 of the current year the Board of Directors voted to change the
Company's name from Tensleep Design, Inc. to Tensleep Technologies, Inc. After
September 30, 1999, the Board of Directors voted to change the Company's name
to Tensleep.com, Inc.  The purpose of changing the name was to reflect the
focus of the Company in developing Internet Technologies and E-Commerce Portal
sites.  At the annual meeting of Shareholders held in July 2000 the
shareholders proposed and approved a change in the Company's name to "Tensleep
Corporation".

NOTE 18: ROYALTY INCOME

In April 2000 the Company learned that pursuant to a license agreement entered
into by and between Zilog and Sundance Design, Inc., which was purchased by
the Company, from Sundance Design, Inc. a non-affiliate, that the Company was
entitled to royalties in the amount of $72,320.  These royalties accumulated
from 1997 through March 2000.  Royalty Income for April 2000 through September
2000 amounted to $49,857.  The Company collected $122,177 during the the
fiscal year ending September 30, 2000 and accrued a payment of $19,748 as of
December 31, 2000 which was collected in January 2001.  The royalty for the
three months ending March 31, 2001 is $14,816 and for the three months ending
June 30, 2001 the company is informed that it will be $47,000.

NOTE 19: LICENSE FEES

In November 1999 the Company provided Silicon Resources, Inc., an unaffiliated
company, a non-exclusive license to use the Company's technology valued at
$750,000 (See note 5 and 12).

In March 2000 the Company granted a license to manufacture and distribute its
"web-modem" in China to China Net & Technologies, Inc., an affiliate.  The
license was valued at $200,000, of which $100,000 was received on signing the
license agreement and the balance is due during the next operating period when
engineering drawings are delivered for manufacturing the product.

NOTE 20: ACQUISITION OF MASTER FINANCIAL GROUP, INC.

On March 31, 2000 the Company acquired 100% of Master Financial Group, Inc.
for 500,000 shares of the Company's common stock valued at $2.50 per share in
a business combination accounted for as a purchase.  Master Financial Group,
Inc. is an Internet financial services company.  The results of operations of
Master Financial Group, Inc. is included in the accompanying consolidated
financial statements since the date of acquisition.  The total cost of the
acquisition was $1,250,000 which exceeded the fair value of the net assets of
Master Financial Group, Inc. by $1,087,352.  The excess is reported as
goodwill in the accompanying consolidated balance sheet and is being amortized
on the straight line method over 10 years.  An additional 200,000 shares of
the Company's common stock may be issued to Master Financial Group, Inc. based
on an earnings contingency.   If the net earnings are more than $500,000 but
less than $1,000,000 a portion of the 200,000 shares will be delivered.

The Company was unable to obtain adequate detailed books and records and
supporting data from the subsidiary Master Financial Group, Inc.  Therefore,
the Company was not able to satisfy itself about the amount that goodwill
was recorded in the consolidated balance sheet at December 31, 2000
(stated at $337,352) and the amount of goodwill amortization expense
(stated at $25,302).

Subsequent to year-end the Company evaluated the recoverability or this
investment and has discontinued the operations of Master Financial Group.
The Company took these actions due to change in market conditions and
inadequate performance of the Company.  The Company has written down
goodwill $750,000 as of the year ending September 30, 2000.  The
write-off of goodwill is included in the September 30, 2000 consolidated
statement of operations as asset impairment.

The Company is owed $430,760 from the prior owner of Master Financial.
In February 2001 Master Financial Group, Inc., commenced legal action to
collect the amount from the former officer and director of Master Finanical
Group, Inc.

NOTE 21: INVESTMENT IN TENSLEEP TECHNOLOGIES, INC.

In April 1999 and July 2000 the Company exchanged net assets valued at
$191,137 for 5,000,000 shares of Tensleep Technologies, Inc., a wholly owned
subsidiary under common control in a business combination accounted for as a
pooling.

Tensleep Technologies, Inc., will complete the development of a motor
controller, a non-Internet product and focus on bringing-to-market penetration
through strategic relationships, joint ventures and international marketing
alliances.

NOTE 22: INCOME TAXES

The Company has not generated any taxable income and therefore a provision for
income taxes is not necessary. Similarly, a provision for deferred taxes is not
necessary.  For income tax purposes, the Company had available, at September
30, 2000 and 1999, net operating loss ("NOL") carryforwards of approximately
$2,257,163 and $1,991,295 respectively, which will expire in various years
from 2018 through 2019.  A valuation allowance was provided in full against
the net deferred tax assets resulting from the losses because the utilization
of the NOL is dependent on future taxable profits.

NOTE 23: DUE FROM TENSLEEP APPLIANCE

The Company has loaned Tensleep Appliance, a related entity, certain funds to
cover start-up expenses. The balance due to the Company is $102,233 and $0 as
of March 31, 2001 and 2000 and is secured by 1,700,000 shares of Tensleep
Appliance stock.  When the loan is paid back by Tensleep Appliance there is an
agreement providing the opportunity for the Company to purchase the 1,700,000
shares of Tensleep Appliance stock for $100,000.



<PAGE>

                         CONSOLIDATED FINANCIAL STATEMENTS

      The consolidate financial statements have been prepared by Tensleep
Corporation, with out audit, pursuant to the rules and regulations of the
Securities and Exchange Commission.  The Company believes that the disclosures
are adequate to make the information presented not misleading when read with
the Company's audited financial statements for the years ended September 30,
2000 and 1999.  The financial information presented reflects all adjustments,
consisting only of normal recurring adjustments, which are, in the opinion of
management necessary for a fair statement of the results from the periods
presented.



                                 TENSLEEP CORPORATION
 Schedule 1
                             CONSOLIDATED BALANCE SHEETS

                                    JUNE 30, 2001


                                         ASSETS
<TABLE>
<CAPTION>
                                      Parent    Subsidiary
                                     Tensleep    Tensleep   Consolidating    Consolidated
                                   Corporation  Technology      Entries        Totals
                                   -----------  ----------  --------------   ------------
<S>                                <C>          <C>         <C>              <C>
CURRENT ASSETS

  Cash                             $    76,104  $    1,557  $            -   $     77,661
  Prepaid Expenses
           (See note 15)                62,500           -               -         62,500
  Due From Tensleep Appliance
           (See note 23)               111,073           -               -        111,073
  Royalty Receivable
           (See note 18)                47,000           -               -         47,000
  Due From Tensleep Technology          13,500           -        ( 13,500)             -
  Loan Receivable                       66,000           -               -         66,000
                                   -----------  ----------   --------------   ------------
          Total Current Assets         376,177       1,557        ( 13,500)       364,234
                                   -----------  ----------   --------------   ------------
PROPERTY AND EQUIPMENT

  Machines & Equipment                       -     102,658               -         102,658
  Software                                   -     172,371               -         172,371
                                   -----------  ----------   --------------   ------------
                                             -     275,029               -         275,029
  Less accumulated depreciation
      and amortization                       -     274,385               -         274,385
                                   -----------  ----------   --------------   ------------
     Net Property and Equipment              -         644               -             644
                                   -----------  ----------   --------------   ------------

OTHER ASSETS

  Investment in China Net &
    Technologies, Inc. (See note 2)    818,667           -               -         818,667
  Investment in Amcor Financial
    Corp. (See note 3)               1,332,430           -               -       1,332,430
  Discontinued Operations
          (See note 20)                200,000           -               -         200,000
  Investment in Tensleep
    Technologies (See note 21)         196,137           -        (196,137)              -
                                   -----------  ----------   --------------   ------------
      Total Other Assets             2,547,234           -        (196,137)      2,351,097
                                   -----------  ----------   --------------   ------------

TOTAL ASSETS                       $ 2,923,411  $    2,201   $   ( 209,637)  $   2,715,975
                                   ===========  ==========   ==============  =============


</TABLE>
<PAGE>

                                 TENSLEEP CORPORATION

                              CONSOLIDATED BALANCE SHEETS
Schedule 1
                                    JUNE 30, 2001

<TABLE>
<CAPTION>
                         LIABILITIES AND STOCKHOLDERS' EQUITY


                                     Parent     Subsidiary
                                    Tensleep    Tensleep    Consolidating   Consolidated
                                   Corporation  Technology   Entries        Totals
                                   -----------  ----------  --------------  ------------
<S>                                <C>          <C>         <C>             <C>
CURRENT LIABILITIES
     Accounts Payable              $     3,270  $      268  $            -  $      3,538
     Loan payable to China               2,291           -               -         2,291
          Net & Technologies,
          Inc. (See note 6)
     Accrued Consulting Fees            75,000           -               -        75,000
     Due to Tensleep Corp.                   -      13,500        ( 13,500)            -
                                   -----------  ----------  --------------  ------------
     Total Current LiabilitiES          80,561      13,768        ( 13,500)       80,829
                                   -----------  ----------  --------------  ------------

TOTAL LIABILITIES                       80,561      13,768        ( 13,500)       80,829
                                   -----------  ----------  --------------  ------------

                                 STOCKHOLDERS' EQUITY

     Preferred stock                         -           -               -             -

     Common stock
          Tensleep Corporation         107,321           -               -       107,321
          Tensleep Technology                -      55,000         (55,000)            -
          Master Financial                   -           -               -

     Treasury stock                          -           -               -             -

     Additional paid-in capital
          Tensleep Corporation       7,151,000           -               -     7,151,000
          Tensleep Technology                -     141,137      (  141,137)            -
          Master Financial                   -           -               -

     Retained Earnings              (4,333,472)   (207,703)              -    (4,541,175)

     Notes for purchase of stock      (082,000)          -               -     (  82,000)
                                   -----------  ----------  --------------  -------------

TOTAL STOCKHOLDERS' EQUITY           2,842,850     (11,566)       (196,137)    2,635,146
                                   -----------  ----------  --------------  -------------

TOTAL LIABILITIES AND
      STOCKHOLDERS' EQUITY          $2,923,411  $    2,202  $     (209,637)  $ 2,715,975
                                    ==========  ==========  ==============  =============

</TABLE>





The accompanying notes are an integral part of these statements.

<PAGE>

                                   TENSLEEP CORPORATION
Schedule 2a
                           CONSOLIDATED STATEMENT OF OPERATIONS

                        FOR THE THREE MONTHS ENDED JUNE 30, 2001

<TABLE>
<CAPTION>

                                      Parent    Subsidiary
                                     Tensleep    Tensleep   Consolidating   Consolidated
                                   Corporation  Technology     Entries         Totals
                                   -----------  ----------  --------------  ------------
<S>                                <C>          <C>         <C>             <C>
REVENUES
    Royalty Income (See note 18)   $    47,000  $        -  $            -  $     47,000
    Other Income                             -         250               -           250
                                   -----------  ----------  --------------  ------------
                                        47,000         250               -        47,250
                                   -----------  ----------  --------------  ------------
EXPENSES

    Advertising                            640           -               -           640
    Automobile expense                     692         250               -           942
    Bank fees & brokerage charges            -          17               -            17
    Consulting expense                  80,700           -               -        80,700
    Depreciation and Amortization            -           -               -             -
    Dues and subscriptions               2,175           -               -         2,175
    Interest                                13           -               -            13
    Other expenses                         460          99               -           559
    Office supplies                          -         199               -           199
    Outside services                     1,598           -               -         1,598
    Payroll & Payroll Taxes                  -           -               -             -
    Postage & delivery                     371         128               -           499
    Professional fees                    6,250           -               -         6,250
    Rent                                     -         383               -           383
    Repairs                                  -          49               -            49
    Supplies                                 -           -               -             -
    Taxes                                    -         720               -           720
    Utilities                            1,027         255               -         1,282
    Travel & Entertainment               6,388       3,206               -         9,594
                                   -----------  ----------  --------------  ------------
                                       100,314       5,306               -       105,620
                                   -----------  ----------  --------------  ------------
INCOME (LOSS) FROM OPERATIONS         ( 53,314)   (  5,056)              -      ( 58,370)
                                   -----------  ----------  --------------  ------------
OTHER INCOME (EXPENSE)
    Interest Income                      1,076           5               -         1,076
    Income (loss) on equity
                 investment         (   17,113)          -               -    (   17,113)
    Asset Impairment
                 (See note 20)               -           -               -             -
                                   -----------  ----------  --------------  ------------
                                    (   16,037)          -              -    (    16,037)
                                   -----------  ----------  --------------  ------------
PROVISION FOR INCOME TAX - NOTE 22           -           -               -             -
                                   -----------  ----------  --------------  ------------
NET INCOME (LOSS)                  $(   69,351)   (  5,056)              -    (   74,407)
                                   ===========  ==========  ==============  ============
</TABLE>



The accompanying notes are an integral part of these statements.

<PAGE>

                                   TENSLEEP CORPORATION
Schedule 2b
                           CONSOLIDATED STATEMENT OF OPERATIONS

                        FOR THE NINE MONTHS ENDED JUNE 30, 2001

<TABLE>
<CAPTION>

                                      Parent    Subsidiary
                                     Tensleep    Tensleep   Consolidating   Consolidated
                                   Corporation  Technology     Entries         Totals
                                   -----------  ----------  --------------  ------------
<S>                                <C>          <C>         <C>             <C>
REVENUES
    Design Fees                    $         -  $        -  $            -  $          -
    Royalty Income (See note 18)        81,564           -               -        81,564
    Other Income                             -         691               -           691
                                   -----------  ----------  --------------  ------------
                                        81,564         691               -        82,255
                                   -----------  ----------  --------------  ------------
EXPENSES

    Advertising                          1,435           -               -         1,435
    Automobile expense                   2,385       1,002               -         3,387
    Bank fees & brokerage charges          207          22               -           229
    Consulting expense                 321,700           -               -       321,700
    Depreciation and Amortization            -      45,731               -        45,731
    Dues and subscriptions               2,385           -               -         2,385
    Filing Fees                              -           -               -             -
    Insurance                                -           -               -             -
    Interest                               360           -               -           360
    Other expenses                       3,293       1,385               -         4,678
    Office supplies                         27         650               -           677
    Outside services                     9,406       4,784               -        14,190
    Payroll & Payroll Taxes                  -       6,742               -         6,742
    Postage & delivery                     816         296               -         1,112
    Professional fees                   47,206           -               -        47,206
    Rent                                     -       1,463               -         1,463
    Repairs                                  -         710               -           710
    Supplies                             1,014       1,708               -         2,722
    Taxes                                    -       1,952               -         1,952
    Telephone                            2,049       1,025               -         3,074
    Travel & Entertainment              19,898       3,206               -        23,104
                                   -----------  ----------  --------------  ------------
                                       412,181      70,676               -       482,857
                                   -----------  ----------  --------------  ------------
INCOME (LOSS) FROM OPERATIONS         (330,617)   ( 69,985)              -     ( 400,602)
                                   -----------  ----------  --------------  ------------
OTHER INCOME (EXPENSE)
    Interest Income                      5,118          15               -         5,133
    Income (loss) on equity
                 investment         (1,108,806)          -               -    (1,108,806)
    Asset Impairment
                 (See note 20)        (300,000)          -               -      (300,000)
                                   -----------  ----------  --------------  ------------
                                    (1,403,688)         15               -    (1,403,673)
                                   -----------  ----------  --------------  ------------
PROVISION FOR INCOME TAX - NOTE 22           -           -               -             -
                                   -----------  ----------  --------------  ------------
NET INCOME (LOSS)                  $(1,734,305)   ( 69,970)              -    (1,804,275)
                                   ===========  ==========  ==============  ============
</TABLE>



The accompanying notes are an integral part of these statements.


<PAGE>

ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.

OVERVIEW

     The Company is an international electronics company developing
technology and technology growth companies.  The Company's business is
two fold: (1) The acquisition, development and licensing of technology;
and (2) The development of technology growth companies in the United
States, China and Europe.

     The Company specializes in products that incorporate digital
signal processors ("DSP") and information appliance servers ("IA").  A
DSP is a microprocessor that converts analog signals to digital
signals and digital signals to analog signals.  An AI is a dedicated
specialized computer, used as a server, which receives data from
another devise, manipulates and communicates the data to a remote
central computer.  The AI may or may not contain a DSP and may be
embedded or external to the other device.

     The Company, its subsidiaries and affiliates provide specialized
services to support the development, manufacture and distribution of
industrial and consumer products containing embedded modular systems
("Embedded Systems")which include a DSP and/or IA.  The Company's
strategic long term plan is to become the world's leading supplier of
electronic components used in fabricating the Embedded Systems.

     The Company's growth is built upon a combination of strategic
acquisitions and affiliations.  The Company, each subsidiary and
affiliate is developing its own operations and building its own revenue
stream.

     The Company is focusing on the acquisition and development of
companies in the United States, China and Europe developing products
for niche markets.  The current emphasis is on companies providing
energy management systems to the power and utility industries and their
customers.  The Company believes retail competition and energy
deregulation in the power and utility industries are best supported by
the development and implementation of Energy Management Systems ("EMS").
The Company's and its affiliates' technology and products are well
suited to play a critical role in the implementation of those systems.

     Energy management systems provide power and utility companies and
their customers with load management, data collection and outage
reporting capabilities.  The Company's and its affiliates' technology
and products are at the core of those systems.

     The Company's operational plan for the next twelve months, requires
limited additional personnel and financial resources.  The Company has
and will continue to engage one or more third party organizations to
provide the quality and number of personnel and services required for
the development of and upgrading of the offered products and services.
The Company, with limited financial resources, is near completing
negotiations for alliances with Chinese companies to manufacture the
products for the Company and its affiliates and to distribute the
products in China.

RISKS

     The factors, which follow, make the Company's twelve month Plan of
Operations risky.

Market Evaluation

     The Company is in a continual process of identifying and evaluating
new niche markets.  The Company has identified energy management systems
as a niche market.  However, there is no assurance that the Company can
identify or evaluate any other niche market.  Even if the Company or its
affiliates should correctly identify and evaluate new niche markets,
there is no assurance the Company or its affiliates can develop any
products or services that would be accepted in those markets or that
the products or services would be developed in a timely manner.

     In order to reduce this risk the Company plans (1) to develop
products with embedded standard modular systems capable of being used in
products that cross market segments, (2) to develop and provide
manufacturing and distribution to independent third party companies
developing and marketing their own niche market products, and
(3) to acquire or invest in businesses that have developed and are
distributing products in identified markets.

Dependence upon new products

     The communications and Internet markets are characterized by rapid
technological change, evolving industry standards, changes in customer needs
and frequent new product introductions, and are therefore highly dependent
upon timely product and production innovation.  In particular, data
communication products are subject to continuous changes in the fabrication
process.  Each change in technology and the fabrication process may require
a concomitant change in design and developed of the Company's products.  The
Company may not have the resources to make those changes.

     The Company's future success is dependent in part upon its ability to
anticipate changes in technology and industry standards and to develop
successfully and introduce new and enhanced products on a timely basis.  The
Company will be required to replace declining revenues from older products
with new products. To reduce this risk the Company is developing modular
designed sub-products, which may reduce the cost of development and time to
market.

     There is no assurance the Company will be able to introduce new
products on a timely basis.  There is no assurance the Company can produce
the new or old products or services, nor achieve any significant degree of
market acceptance for them, nor sustain acceptance for any significant
period.  Failure to produce or achieve or sustain market acceptance of its
products or services would affect the Company's operating results.

Competition

     The markets in which the Company operates or will attempt to operate
may be characterized by competition among a number of small and potentially
large companies that are well financed with a long history.  They will have
substantial advantages in terms of breadth of technology, sales, marketing,
resources and support capability.

Ability to manage a rapidly changing business

     The Company is anticipating significant growth, which will place a
substantial strain on its operational, administrative and financial
resources.  The Company's officers have experience in managing companies as
large and as rapidly changing as is anticipated. However, there is no
assurance that the experience will prove beneficial to the new situation
posed by the Company's challenges.  The Company's ability to manage any
future changes effectively will require it to have sufficient funds to
attract, train, motivate and manage its employees effectively.

Dependence on key personnel

     The value of the Company lies in the experience and ability of the
management of the Company and its affiliates to identify and develop its
technology, products and services.  If the Company and its affiliates severe
their relationship, the effect would have a serious effect on the Company's
operations.

     The Company recognizes that some people believe that the high
technology industry, in which the Company plans to compete, is one where
significant developments are in new technology and "expertise" is a quantity
that dates and loses value quickly.

     The Company's success depends greatly on the continued contributions
of the Company's affiliates.   The loss of the Company's affiliates could
have a material adverse impact on the Company's operating results.

     The Company believes its future success will depend in large part upon
its ability to attract and retain additional highly skilled management,
technical, marketing, research and development, product development and
operations personnel.  Competition for such personnel is intense, and no
assurance can be given that the Company will be successful in attracting and
retaining such personnel.

Lack of Revenues

     The Company and its affiliates lack a consistent source of revenues.
The Company has experienced revenues from single payment License fees
and royalties, but there is no assurance the Company will be able to
licence its technology in the future or that the Royalties will continue at
their present level.  There is also no assurance that the Company can earn
revenues beyond its current level for the next twelve months.

Lack of Funds

     The Company and its affiliates lack funds to market the products and
services effectively.  Market their products and services effectively
require significant cash to cover specific marketing costs, costs of
prototypes and technical and specific design services for potential
customers.  No assurance can be given that the Company or its affiliates
have or can obtain sufficient funds to enable them to conduct an adequate
marketing and sales program.

                          PLAN OF OPERATION

     The Company's business and operational plan for the next twelve months
is directed toward the manufacturing and distribution of its and its
affiliates' products in China, and the distribution of its products and
services in the United States and Europe.

Operations

     The Company and its affiliates are currently operating and will
continue to operate with available funds.  The current burn rate for
the company is approximately $7,500 to $10,000 per month.  The Company
is now and will continue to limit its expenses and not incur debt.
The Company's expenses are limited to phone bills, limited travel,
office supplies, accounting services, repairs and maintenance, outside
services and other small but ordinary business expenses.

     The Company believes that it can continue operating over the next
twelve months.  It can do so by continuing the current level of expenditure
and not increasing the expenditure of cash without having the cash on hand.
The Company during the next twelve months, at this level of expenditure,
believes that it will be able to complete its plan of operation.

     The Company, as part of its operational plan, is concentrating on the
Appliance Technology Group and is focusing its attention on the Power and
Utility Industries and the development of energy management systems.

Appliance Technology Group

     Tensleep Technologies, Inc. ("Tech"), a wholly owned subsidiary,
formed in 1999 was organized and is chartered with continuing to focus on
Tensleep's original business and bringing-to-market penetration of the
Internet appliances and developed integrated systems through strategic
relationships, joint ventures, and international marketing alliances.
The Company transferred its computer design software and hardware to Tech
and sold its ownership interest in Silicon Resources.  Tech has
completed the development and is testing a variable speed motor
controller, a non-Internet product.

     Appliance Partners, Inc., an affiliate, provides the technical
engineering and design services to Tensleep in developing and prototyping
Tensleep's Internet-related products. These products, CyberServers, are
special-purpose modular appliance servers. This product line will be
expanded to include the iCamera Cradle, a digital camera server, the
iController, a home controller, and the iModule. Appliance Partners will
continue to engineer and design unique applications in the Internet
Access Device (IAD) market, consumer and small office or home office
(SOHO) appliance market.

     The transfer of the CyberServer business allows the Company to focus
on identifying and developing strategic relationships with emerging growth
companies in related businesses that help in the Company's business and
corporate development. Tech's business plan is to acquire new product
technology, establish manufacturing relationships and to distribute
products to consumers and original equipment manufacturers.

     Appliance Partners' business plan is to develop and market a series
of specialized IAs.

     Tensleep believes that continued implementation of its general plan of
operation requires few additional personnel.  However, its affiliates in
order to develop and upgrade the various products will require additional
personnel consisting of engineers, marketing and sale people. In addition,
Company is seeking strategic relationships with independent organizations
in the United States and China to participate in the development and upgrading
the products and services.

     China Net & Technologies, Inc. ("China Net"), an affiliate, is a
high-technology and Internet-related company that specializes in developing
strategic relationships with emerging-growth, high-technology companies in
China. China Net has acquired a license to manufacture and distribute
Tensleep's iModule in China and is completing negotiations with several
Chinese companies to manufacture and distribute the IA's in China.

Internet Integration Group

     Tensleep, in January 2001, decided to withdraw from the acquisition of
Whisk.co.uk, Limited, not to develop Tensleep Europe, Inc., and not to
proceed with the development of the Internet Integration Group.

Financial Services Group

     The Company has discontinued the business operations of Master
Financial Group, Inc.

     The Company, in August 2001, acquired a majority interest in Amcor
Financial Corp. ("Amcor"), now Tensleep Energy Corporation ("Tens
Energy").  Tens Energy is focusing on the acquisition and financing of
companies developing and distributing EMS.

Research And Development

     Appliance Partners, within the next twelve months, plans
to develop prototypes of the iCamera Cradle and iController.

Purchase And Sale of Equipment

     The Company does not expect to purchase or sale equipment during the
next 12 months.

STRATEGIC RELATIONSHIPS AND NEW TECHNOLOGY

     The operational plan provides for the acquisition of new products and
seeking strategic relationship with companies that develop and manufacture
consumer communications products.  Management intends to acquire other
companies and acquire technology by exchanging shares of its common stock
or, in limited cases, when sufficient funds are on hand to use cash.

YEAR 2000 ISSUES

     The Company failed to have a material effect from any Year 2000
issues.

CREDIT FACILITY

     The management does not have a credit facility.

DISCUSSION AND ANALYSIS

     The following discussion and analysis should be read in conjunction
with the Company's consolidated financial statements and notes thereto
included elsewhere in this quarterly report on Form 10-QSB. Except for
the historical information contained herein, the following discussion
contains certain forward-looking statements that involve risks and
uncertainties, such as statements of the Company's plans, objectives,
expectations and intentions. The cautionary statements made in this
quarterly report on Form 10-QSB should be read as being applicable to
all related forward-looking statements wherever they appear herein.
See "Special Note Regarding Forward-Looking Statements." The Company's
actual results may differ materially from the results discussed in the
forward-looking statements.

NET REVENUES.

      Net revenues for the three months ended June 30, 2001 and 2000
were $47,250 and $35,566, respectively, an increase of $11,684 or
approximately 33%. The increase in net sales was due to an increase in
Royalty income from $14,565 to $47,000, based on information received by
management from Zilog Corporation, and increase of 322%.  In the
quarter ending June 30, 2000 the Company earned $21,000 from
providing chip design services, but discontinued providing such services
thereafter.

     Net revenues for the nine months ended June 30, 2001 and 2000
were $82,255 and $1,059,442, respectively, a decrease of $977,187 or
approximately 92%.  The decrease in net sales was due to the sale of
two licenses and the payment of a one time license fee in each
quarter for the prior year and there was no license sold in the
second quarter of the current year.

     The Company does not anticipate direct revenues in excess of royalty
payments for the remainder of the year.

     The Company and its affiliates are focusing its attention to the
development of business in the Power and Utilities Industries with the
marketing and distribution of EMSs. The Company's plan is to establish
channels of distribution and develop strategic relationships in order
to provide a broader product line of services and products.

EXPENSES.

      The Company's expenses for the three months ending March 31, 2001
and 2000 were $105,620 and $156,286, respectively, an decreased of
$50,666 or approximately 32%.  The decrease was due to the decrease in
depreciation with the equipment and furniture being fully depreciated
in the previous quarter and a reduction of Professional fees and other
expenses incurred in the last quarter.  The expenses for the period
ending March 31, 2001 represent those incurred by Tensleep and Tech
verses the Company only.

      The Company's expenses for the nine months ending June 30, 2001
and 2000 were $482,857 and $569,105, respectively, a decreased of
$86,248 or approximately 15%.  The decrease was due to a decrease in
Advertising of $67,215, Outside services of $12,057, Depreciation of
$22,865, but with an increase of Accounting fees in the amount of
$21,667.  The expenses for the period ending June 30, 2001 represent
those incurred by Tensleep and Tech verses the Company only.

INCOME (LOSS) FROM OPERATIONS

      The Company's losses from operations for the three months
ending June 30, 2001 and 2000 were $58,370 and $120,720,
respectively, a decreased in losses of $62,350 or approximately 52%.
The decrease was due to a decrease in expenses as indicated above.

      The Company's income or loss from operations for the nine
months ending June 30, 2001 and 2000 were a loss of $400,602 and
income of $490,337, respectively, a decreased of $890,939 or
approximately 182%.  The decrease was due to a decrease in revenues
as discussed above.


OTHER INCOME AND EXPENSES.

      The Company's other income and expenses for the three months
ending June 30, 2001 and 2000 were a net loss of $16,037 and income
of $1,493, respectively, an decreased of $17,530 or approximately
1174%.  The decrease was due to a reduction in value of Amcor in
the amount of $17,113.

      The Company's other income and expenses for the nine months
ending June 30, 2001 and 2000 were a net loss of $1,403,673 and
income of $1,493, respectively, an decrease of $1,402,180 or
approximately 93917%.  The decrease was due to the discontinuance
of Master Financial's business, the sale of the Company's
interest in Silicon Resources, Inc. and the reduction in value
of the Company's interest in Amcor.


NET INCOME (LOSS).

      The Company's net income or loss for the three months ending
June 30, 2001 and 2000 were a loss of $74,407 ($0.008 pre share)
and a loss of $119,227 ($0.02 per share), respectively, a decreased
in losses of $44,820 or approximately 38%.  The decrease was due
to a decrease in expenses as discussed above.

      The Company's net income or loss for the nine months ending
June 30, 2001 and 2000 were a loss of $1,804,275 ($0.19 per share)
and income of $491,829 ($0.07 per share), respectively, a decreased
of $2,296,104.  The decrease was due to a decrease in revenues, the
discontinuance of Master Financial's business, the sale of
the Company's interest in Silicon Resources, Inc., and reduction in
value of Amcor Financial.


WORKING CAPITAL

      The Company's adjusted working capital decreased from $502,888
to $190,661 for the months ending June 30, 2000 and 2001,
respectively.  The adjusted working capital was determined by reducing
the Current Assets by the amount of Prepaid Expenses, $312,395 and
$62,500, and Due from Tensleep Appliance, $53,899 and $111,073,
+respectively, as of June 30, 2000 and 2001, respectively.

     The Company's adjusted working capital ratio as of March 31, 2001
and 2000 was  2.36:1 and 92.07:1, respectively.  The adjusted working
capital ratio was determined by reducing the Current Assets by the
amount of Prepaid Expenses, $62,500 and $312,395, and the amount Due
from Tensleep Appliance, $111,073 and $53,899, as of June 30, 2001 and
2000, respectively.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

      This report contains certain forward-looking statements. These
forward-looking statements generally include the plans and objectives
of management for future operations, including plans and objectives
relating to the Company's future economic performance. The
forward-looking statements and associated risks may include, relate
to or be qualified by other important factors previously set forth.



                              PART II

ITEM 1.  LEGAL PROCEEDINGS.

      In February 2001 Master Financial has filed a legal action in
the trial court for the State of Minnesota against James Y. Wang, a
former President and director of Master Financial to recover all its
assets and books and records.  The assets sought to be recovered
includes cash in excess of $300,000.

ITEM 2. CHANGE IN SECURITIES

      None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

      Not Applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS

      Not Applicable.

ITEM 5.  OTHER INFORMATION

     In June 2001 Ronald Wasserman resigned as the Chief Financial
Officer of the Company and Ronald S. Tucker re assumed his that
position.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

(a)  Exhibits.

      None.

(b) Reports on Form 8-K.

      None.

                             SIGNATURES

     In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed by the undersigned, there unto
duly authorized.


                         Tensleep Corporation
                            (Registrant)

  Signature                      Title                    Date

/S/   Ronald S. Tucker        Director, CEO           August 19, 2001
Ronald S. Tucker