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

                                  FORM 10-KSB
                  [X] ANNUAL REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                    For the fiscal year ended June 30, 2003

                                       OR

                    [ ] TRANSITION UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
              For the transition period from ________ to ________


                              TS Electronics, Inc.
                        (formerly named Softstone Inc.)
             (Exact name of registrant as specified in its charter)

    Delaware                        000-29523                       73-1564807
--------------              ------------------------              -------------
   (state of                (Commission File Number)              (IRS Employer
incorporation)                                                     I.D. Number)

                     111 Hilltop Lane, Pottsboro, TX 75076,
                                  903-786-9618
            -------------------------------------------------------
            (Address and telephone number of registrant's principal
               executive offices and principal place of business)

      Securities registered under Section 12(b) of the Exchange Act: None

         Securities registered under Section 12(g) of the Exchange Act:
                         Common Stock, $0.001 par value
                         ------------------------------
                                (Title of Class)

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

Check  if there is no disclosure of delinquent filers in response to Item 405 of
Regulation  S-B  is  not  contained  in  this  form,  and  no disclosure will be
contained,  to  the  best  of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or  any  amendment  to  this  Form  10-KSB.  [X]

State  issuer's  revenues  for  its  most  recent  fiscal  year:  $37,490

<PAGE>

State the aggregate market value of the voting and non-voting common equity held
by  non-affiliates computed by reference to the price at which the common equity
was  sold,  or  the  average  bid  and  asked price of such common equity, as of
October  8,  2003:  $1,451,817.

As  of  October  9,  2003,  there were 600,000 shares of the Registrant's Common
Stock,  par  value  $0.001  per  share,  outstanding.

                      DOCUMENTS INCORPORATED BY REFERENCE

If  the following documents are incorporated by reference, briefly describe them
and  identify  the  part  of  the Form 10-KSB (e.g., Part I, Part II, etc.) into
which  the document is incorporated:  (1) any annual report to security holders;
(2) any proxy or information statement; and (3) any prospectus filed pursuant to
Rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act").  The listed
documents  should be clearly described for identification purposes (e.g., annual
report  to  security  holders  for  fiscal  year ended December 24, 1990).  None

Transitional  Small  Business Disclosure Format (check one):  Yes  [ ]  No  [X]




















                                       ii
<PAGE>

                                TABLE OF CONTENTS

                                                                           Page
                                                                           ----

Item  1          Description  of  Business                                   1

Item  2          Description  of  Property                                   8

Item  3          Legal Proceedings                                           8

Item  4          Submission of Matters to a Vote of Security Holders         9

Item  5          Market  for  Common  Equity  and  Related
                   Stockholder  Matters                                      9

Item  6          Management's  Discussion  and  Analysis                    11

Item  7          Financial  Statements                                      13

Item  8          Changes  In  and  Disagreements  With
                   Accountants on Accounting and  Financial  Disclosure     29

Item  9          Directors,  Executive  Officers,  Promoters
                   and Control Persons                                      29

Item 10          Executive  Compensation                                    31

Item 11          Security Ownership of Certain  Beneficial  Owners
                   and  Management                                          31

Item 12          Certain  Relationships  and  Related  Transactions         32

Item 13          Exhibits  and  Reports  on  Form  8-K                      33

Item 14          Controls  and Procedures                                   34

Signatures                                                                  35





                                      iii
<PAGE>

Item  1.  Description  of  Business.

Business  Development.
----------------------

     Our company TS Electronics, (formerly, Softstone, Inc.) was incorporated on
January  28,  1999, pursuant to the provisions of the General Corporation Act of
the  State  of  Delaware.  On  May  31, 1999, we merged with Soft Stone Building
Products,  Inc., an Oklahoma corporation that was a predecessor to our company's
business.  Our  initial  business operations were conducted at 620 Dallas Drive,
Denton,  Texas  76205.  On February 1, 2000, we moved our offices and facilities
to  Ardmore,  Oklahoma.  In  June  2002  we moved our production facilities to a
building  in  Ardmore,  OK  at  an  industrial  air park and we moved our office
facilities  to  111  Hilltop  Lane, Pottsboro, Texas 75076, which is our present
address.  Our  principal  operations  began  in  the quarter ended September 30,
2002.  On  August  13,  2003  we  changed  our  name  to  TS  Electronics,  Inc.

Description  of  Business
-------------------------

     Our  focus  initially  was solely on realizing the commercial benefits of a
process  developed  for  this  purpose  and  patented  by  our  first president,
Frederick  Parker.  Because  we  have  this  process,  we  have  a contract with
Michelin  North  America's  Ardmore  tire manufacturing facility that pays us to
take  its  waste  tires.

     More recently our primary focus has shifted to the commercial possibilities
of  a  superior,  newly  discovered devulcanization process to which we recently
acquired  a  5.5-year exclusive license for the Western Hemisphere.  In addition
we  have  begun  an  importation  business dealing in hard-to-find and specialty
crumb  rubber.

     Devulcanization  -  The  Levgum  Process
     ----------------------------------------

     This  process  - called the Levgum Process after the name of the company of
scientists  and  engineers  in  Israel that developed and patented the process -
breaks  down  the  sulfur  links across polymer chains in vulcanized rubber.  It
allows  the  rubber  to  be  used  again.

     There  are  other  devulcanization techniques. But, ours is better, cheaper
and  eco-friendlier  than  all  others.

     Before  we  agreed  to  pay $250,000 for our exclusive license, we took the
Levgum devulcanized rubber product to the Akron Rubber Development Laboratory in
Akron,  Ohio for testing and for comparison with virgin rubber and with the best
devulcanized  rubber  produced  by  other  techniques.  The  laboratory results:

-     Levgum  devulcanized  rubber  retains  80  percent  of  virgin  rubber's
properties,  making  it most useful. Other techniques retain 40 percent at best.

                                        1
<PAGE>

-     Levgum's  devulcanized  rubber  can be produced at significantly less cost
than  can  other devulcanization technologies or than the cost of virgin rubber.

-     We  use  conventional  machines operating at room temperatures.  Competing
technologies employ lengthy operations involving grinding, chemical, heating and
mechanical  processes.

-     The  Levgum  devulcanization process is non-toxic and eco-friendly.  Other
technologies  are  not.

     We  took  a  sample  of the Levgum devulcanized rubber and the Akron Rubber
Development  Laboratory  test results to the chief chemist at Michelin's Ardmore
tire  factory.  The chemist advised us that our product is superior to all other
devulcanized  rubber  products.

     We  have  attempted to exploit our licensed technology through sub-licenses
throughout the Western Hemisphere.  In addition to our Michelin contract, we are
engaged  in  discussions with Rubbermaid's principal plant in Mexico.  It has to
dispose  of  150  tons  of  waste  rubber  a  month.  By substituting our Levgum
technology  and  making  use  of  its own waste rubber, this Rubbermaid facility
should effect savings of $99,000 a month - savings that drop to its bottom line.

     We  do  not propose to build devulcanization plants. Instead, we propose to
sub-contract  the initial manufacturing of the devulcanized rubber and then sell
sub-licenses  to  other  companies.  We  will also offer our assistance with the
marketing of the devulcanized rubber for a commission. Prospective licensees can
send  representatives  to  us to learn the nuances of the Levgum process, and we
will offer through our contacts a turnkey system for r their own devulcanization
facilities. Our license obligations to Levgum and our anticipated charges to our
sub-licensees  are  as  follows:

<TABLE>
<CAPTION>
                                                     Charges
                                   -------------------------------------------
                                    Our  outgo     Income  from       Net  to
                                    to  Levgum     sub-licensees     Softstone
                                   ------------    -------------     ---------
Levgum-supplied  "modifier"
<S>                                <C>              <C>              <C>
  to mix with used rubber          $3,000 a ton     $3,500 a ton     $500 a ton

Royalty  on  a  ton  of  Levgum-
  processed  rubber                   $30 a ton        $60 a ton      $30 a ton

Sub-license  fee                       $0            Will  vary       Will vary
</TABLE>

     We  need  $50,000  in  capital to fund our manufacture of a fully automated
tire  de-beader,  which we propose to then manufacture for sale to the industry,
to pursue opportunities to sublicense the Levgum devulcanization technology, and
to  market  crumb  rubber  produced  by  us  or other manufacturers. We have not
identified  the  source  of  these  funds.


                                        2
<PAGE>

     Devulcanization
     ---------------

     Technology  exists  today to "fine grind" rubber from 80 to 200 mesh (holes
per  square  inch).  This technology has long been the best source for injecting
recycled  rubber into virgin rubber mixes.  The cost to do so is extremely high;
often  costing  20  to  30  percent  more than the cost of virgin rubber itself.
Rubber  manufacturing  companies  do  this to meet government regulations and to
have  a way to recycle their own waste.  Rubber disposal is extremely expensive;
companies  that can "fine grind" have the ability to sell back to a company 100%
of  its  scrap  in  a  usable  form.

     For  years,  manufacturers  tried  to  establish  a process that breaks the
sulfur  links  across  polymer chains (devulcanize) without hurting the original
chemical  properties,  allowing  the resulting material to be re-deployed in new
and  existing  products.  Although  some have been successful, they were plagued
with  economic  or environmental problems.  We have a 5.5-year exclusive license
to the Western Hemisphere for a process that (i) breaks the sulfur lattice under
normal  room  temperature  conditions  using conventional machines and (ii) does
away  with  the  expensive  and lengthy operations involving grinding, chemical,
heating  and  mechanical  processes.  It  is  the only process known to us where
relatively  large  pieces  of  rubber  waste  can  be used, a feature that saves
substantial amounts of investment in terms of plant and machinery, labor, power,
space, storage and transportation.  The process itself is 100% non-toxic and eco
friendly.  The  final  product produced is in granular form and, when mixed with
virgin  rubber or master compounds, results in better homogeneity than any other
process we know of.  The test results we obtained from a test facility in Akron,
Ohio  proved that the devulcanized rubber, itself, maintains 80% of the original
properties  of  the  uncured  compound.  This  results  in a product that can be
produced  and  sold  at  a  cheaper  price  than  the "fine grind" powders while
maintaining  much  higher  physical  properties.

Our  devulcanized  rubber  development  plan  is  as  follows:

     1.  Develop  a  turnkey  devulcanization  system.
     2.  Develop  the  market.
     3.  Sub-license the technology to large recyclers, the largest of which has
         contacted Softstone and is very interested  in  using  the  technology.

     We envision utilizing our contacts in the recycled rubber and virgin rubber
industry to establish market presence.  We see no need at this time to establish
a raw material supply beyond the needs of the  development location to implement
the  devulcanized  technology into the market. Instead, we plan to expand on our
relationships with crumb rubber manufacturers by sublicensing the technology and
jointly  developing  the  market.

     Our  compensation  for  these efforts will come from the following sources.

     1.  Sales  of  devulcanized  rubber  from  the  pilot  plant  in  Ardmore.
     2.  Sales  of  sub-licenses.
     3.  Sales  of  specialty  crumb  rubber.
     4.  Royalties  for  the  amount of rubber devulcanized with our process and
         commissions  on  sales.

                                        3
<PAGE>

     Conversion  of  Waste  Tires  Into  Useful  Products
     ----------------------------------------------------

     There  is  a  worldwide need for a method to convert whole waste tires into
useful  products  with  no  waste  as  a  byproduct  and with favorable economic
results.  New  tire  manufacturers  in the U.S. are required to dispose of their
manufacturing rejects without creating an unsightly mess or adding to ecological
problems.  Government  agencies at all levels tend to cooperate with any company
having  a reasonable means of disposing of the approximately seven million tires
each  year  that are discarded as rejects or as worn-out tires.  Virtually every
state  has  a program whereby it pays a fee per tire to qualified companies that
dispose  of  used  tires.

     Softstone's  past  president,  Frederick  Parker,  is  a  co-inventor  of a
patented  process  Softstone  uses  to convert waste tires into useful products.
The  Parker  I  System  machine  was  constructed  in  Ardmore,  Oklahoma  as  a
proof-of-concept  prototype. With subtle adjustments recently made, this machine
became a production model that ingests whole tires at one end of the machine and
ejects  rubber modules at the other end with virtually no waste or contaminants.
The  rubber modules are virtually indestructible and have been tested for use as
a  playground  covering,  pathways,  walking trails, horse barn stalls and other
uses.

     The  Parker  I  System  machine  can  make  a  variety of products by using
different  molds.  Our  most  popular  product is a two-foot by four-foot module
approximately  two  inches  thick that interlocks with adjacent modules for walk
ways  and  driveways.  However,  the  size  and  thickness of the modules can be
adjusted for use as highway cone holders, crash barriers, guardrails, bridge and
road  impact  pads  and as a substitute for asphalt in several key applications.

     Approximately  80 to 85 percent of the modules' composition is comprised of
wire-free   tire  chips.    The  balance  is  comprised  of   readily  available
polyurethane  binders  and  other  substances.

     We  have  raised  and  spent  approximately $1.5 million since inception on
developing  our  patented  process  and on designing and constructing our Parker
System  I  proof-of-concept  machine  in  Joshua,  Texas. The Parker System I is
highly  automated.  Whole  tires  are  inserted into a shredder, reduced to chip
rubber,  blended  with a specially prepared binder element, placed into a custom
mold  and  then  pressed  into place and locked. These molds are then moved on a
conveyor  belt  through  a heated oven where the product cures and comes out the
other end as a rubber-molded product ready for sale. We believe there is no more
efficient  or  economical method of processing tires into finished products than
our  process.

     We  need  to  refurbish  our  tire  shredder and to purchase equipment that
produces  wire-free  chips from the shredded tires. However, once this equipment
is  added to our existing machinery, our plant should become profitable and will
have  several  cash  flow  streams  -

-     tire  revenue  from  Michelin,

-     sale  of  modules,

                                        4
<PAGE>


-     sale  of  extra  crumb  rubber,

-     sale  of  excess chip rubber for use as tire-derived fuel in cement plants
      in  the  southwestern  U.S.,  and

-     additional  rubber-molded  product  lines  (still  to  be  developed).

     Our modules have withstood a 300,000-pound deformation test and immediately
rebounded;  yet,  the  product  has  qualified  for  installation  on children's
playgrounds.  The product is ready to be installed immediately after it is made.
There is no curing time necessary.  The product is relatively light but does not
break,  crack  or  tear.

     We  have  attended  U.S. Army Corps of Engineers presentations at which our
product was discussed by the Corps as a suitable substitute for concrete in uses
such  as  erosion control along the Mississippi River.  Our articulated mattress
configurations  have  multiple  applications  for  the  Corps  -

-     in  soil  conservation,

-     along  highways,

-     at  beaches  as  storm  surge  protection,

-     for  wetlands  protection,

-     as  temporary  roads  over  delicate  marshlands,

-     to  prevent  riverbank  erosion,  and

-     underwater,  to  cover  transoceanic pipelines and protect them from being
      snagged  by  fishnets.

     We  believe,  however, that the primary markets for our products are paving
applications  where  concrete  and  asphalt  now  dominate,  such  as sidewalks,
driveways  and trails.  Concrete and asphalt have significant drawbacks compared
to  Softstone-based  products.  Concrete and asphalt crack and heave due to soil
and  weather  conditions.  They often must be replaced after a few years of use.
Softstone's rubber modules, however, will not crack because of weather's cold or
melt because of its heat.  If there is a soil heaving condition, our product can
be  lifted  and  relaid  when  the  ground  condition  is  corrected.

     Crumb  Rubber  Importation
     --------------------------

     In  the  United  States  today  there  exists a demand for several specific
grades  of  crumb rubber.  Until recently these grades had been considered waste
and commonly were landfilled or incorporated in various molded products.  Hence,
the  lack of value of these materials had limited their production.  In the last
three  years,  however,  the  crumb  rubber  industry  has seen some significant
changes, predominantly in the areas of playground and landscape.  The demand for

                                        5
<PAGE>

such  material  has entered into the hundred million pounds per year sector, and
U.S.  production  only  manufactures approximately 24,000,000 pounds per year of
this  specified material.  We have gained a presence in the international market
and  has  located  various  suppliers  world wide to assist us in brokering this
material.

Distribution  Methods
---------------------

     We  have  several  interested  parties  for  the distribution of our paving
material; however, since we have temporarily shut down this operation, we do not
have  the  product  available  for  distribution.

Competitive  Business  Conditions
---------------------------------

     Many  firms  make  molded  rubber products, including some for patio, horse
trailer  and barn applications as well as sell specified crumb rubber. It is our
observation and belief that our products are superior to all others in economics
and  durability and we are much more price competitive than our U.S. competition
in  regards  to  sales  of  crumb  rubber.

Sources  and  Availability  of  Raw  Materials;  Names  of  Principal  Suppliers
--------------------------------------------------------------------------------

     There is virtually an endless supply of waste tires.  Many sources will pay
us  to  take  the  tires  off  their hands.  Our earlier operation of the Parker
System  was  based  on  Michelin's paying us $0.77 to $0.85 a tire for recycling
purposes.  However,  in  some sectors of the market, specifically the playground
and  landscape industries, there is only a limited amount of the needed material
produced  in  the  United  States on an annual basis.  This has led us to import
crumb  rubber  from  overseas  suppliers  in India, Sri Lanka and China.  We are
currently  working  on  increasing  our  monthly  supply  by  signing  up  new
manufacturers  from these three areas.  This would alleviate a dependence on any
one  supplier  and  level  out  our  monthly  revenues.

Dependence  on  Major  Customers  or  Suppliers
-----------------------------------------------

     We  are  dependent  on  our  international  suppliers  for  our  sources of
specified  crumb  rubber.  The  supply  in  the United States of the material we
import  is  100%  consumed  on  an  annual  basis.

     We are still in the development stage as far as sales are concerned and are
dependent  upon one major customer in St. Louis.  There are many other buyers of
the same material in the United States; however, we are currently only supplying
a  small  percentage  of  their  estimated  monthly  capacity.

Patents,  Trademarks  and  Licenses
-----------------------------------

     The  inventors  of our patented Parker One System, one of whom is Frederick
Parker,  our  past  president,  have  assigned  the  patent to Softstone with no
retained  royalty.

     We  have  a  5.5-year  exclusive  license  to  the  Levgum  devulcanization
technology  for  the  Western  Hemisphere.

Government  Approval  of  Principal  Products  or  Services
-----------------------------------------------------------

                                        6
<PAGE>

     We  are  not  required  to  obtain  the  approval  of  our  products by any
governmental  agency.  Our  operations,  however,  are  subject  to  a number of
governmental  regulations.

Government  Regulations
-----------------------

     Our  operations  are  subject  to  regulation by various federal, state and
local governmental entities and enactments, which include environmental laws and
workplace  regulations,  including  the  Occupational Safety and Health Act, the
Fair  Labor Standards Act, the Clean Air Act, the Clean Water Act and other laws
and  regulations  regarding  health,  safety,  sanitation, environmental issues,
building  codes and fire codes.  We believe that our current compliance programs
adequately  address  such concerns and that we will be in substantial compliance
with  such  laws  and  regulations.  Our  failure  to  comply with such laws and
regulations  could  result  in  serious  sanctions  and  penalties  that  could
materially  and  adversely  affect  our  business.

Research  and  Development
--------------------------

     We  have  spent  approximately $650,000 over the last two years in research
and development activities with regard to the development of our products.  None
of  the  cost  of  these  activities  was  borne  directly  by  our  customers.

Environmental  Laws
-------------------

     We  must  comply  with  the  environmental regulations of the Environmental
Protection  Agency  and  the equivalent Oklahoma and Texas agencies charged with
environmental  protection.  This  consists,  primarily,  in  complying  with
regulations  regarding the disposal of waste products.  Such compliance requires
no  significant  outlay  of capital by us and only minimum costs.  We produce no
hazardous  waste  as  most  of  our  competitors  do.

Seasonality
-----------

     There  is  no  seasonal  aspect  to  our  business.

Employees
---------

     At  present  we  have  one  full-time  employee and no part-time employees.

     Exclusive  License  With  Levgum,  Ltd.
     ---------------------------------------

     On  March  15, 2002 we executed an agreement with Levgum, Ltd. of Tel Aviv,
Israel.  Levgum  owns  patents  pertaining  to  certain  technology  for  the
devulcanization  of  rubber  tires.  We  are  convinced  that  this  is the best
devulcanization  technology  in the world and that it is commercially viable, as
compared  to other devulcanization technologies that work but cost more to apply
per  pound  of  rubber  produced  than  the  cost  of  virgin  rubber.

                                        7
<PAGE>

     Levgum  shipped  to  us  ten kilograms of its devulcanized rubber for us to
perform  laboratory  trials  on.  The  trials  were  most  satisfactory. We then
acquired the exclusive rights to Levgum's technology for the Western Hemisphere,
including  the  right  to  sublicense  the  technology  in this geographic area.

     We paid $250,000 to Levgum for these exclusive rights for a 5.5 year period
and for a ten percent equity interest in Levgum. To retain the exclusive rights,
we  will  have  to  remit  royalties  to  Levgum  as  follows:

<TABLE>
<CAPTION>
<S>                                       <C>
          First  18  months:              $   200,000
          Next  12  months:                 1,000,000
          Next  12  months:                 2,000,000
          Next  12  months:                 3,000,000
          Next  12  months:                 5,000,000
</TABLE>

The  royalties  will consist of $30 for each ton of devulcanized rubber produced
in  the  Western  Hemisphere  using  Levgum's  devulcanization  technology.

Reports  to  Security  Holders
------------------------------

     We file reports with the Securities and Exchange Commission.  These reports
are  annual  10-KSB, quarterly 10-QSB, and periodic 8-K reports.  We also intend
to  furnish  stockholders  with  annual  reports containing financial statements
audited  by  independent public or certified accountants and such other periodic
reports  as  we may deem appropriate or as required by law.  The public may read
and  copy any materials we file with the SEC at the Public Reference Room of the
SEC  at  450  Fifth Street, N.W., Washington, D.C. 20549.  The public may obtain
information  on the operation of the Public Reference Room by calling the SEC at
1-800-SEC-0330.  We  are  an electronic filer, and the SEC maintains an Internet
Web  site  that  contains  reports,  proxy  and information statements and other
information  regarding  issuers  that  file  electronically  with  the SEC.  The
address  of  such  site  is  http://www.sec.gov.

Item  2.  Description  of  Property.

     We  neither  own  nor  lease any office or manufacturing space.  Our office
space  is  provided  rent  free  in  Pottsboro,  Texas by our president, and our
manufacturing space, in which all our tire processing equipment has been placed,
has  been  provided  rent  free  in Ardmore, Oklahoma by the Ardmore Development
Authority.

Item  3.  Legal  Proceedings.

     Neither  our  company nor any of our property is a party to, or the subject
of,  any  material  pending  legal  proceedings  other  than  ordinary,  routine
litigation  incidental  to  our  business.

Item  4.  Submission  of  Matters  to  a  Vote  of  Security  Holders.

     There  have  been no matters submitted to a vote of our stockholders during
the  last  fiscal  year  or  during  the subsequent period to the filing of this

                                        8
<PAGE>

report.  However,  we  took  the following action on August 13, 2003 pursuant to
the  written  consent  of  the  record  holders of a majority of the outstanding
shares  of  our  common  stock:

     -  We  changed  our  name  from  Softstone  Inc.  to  TS  Electronics, Inc.

     -  We  consolidated  to 600,000 shares all outstanding shares of our common
        stock,  effective  August  14,  2003.

By  written  consent  of  the  record  holders  of a majority of the outstanding
shares, we approved - but have not yet effected - the following actions, subject
to  our  mailing  an  Information  Statement to the non-consenting shareholders:

     -  We  will  issue  5,350,000  shares of our Common Stock to TS Electronics
        (China)  Corp.  in  exchange  for  all  its  capital  stock.

     -  We  will  sell  to  an entity  owned by Gene F. Boyd, Betty Sue Boyd and
        Keith  P.  Boyd  ("the  Boyds"),   who  are   our  present   controlling
        shareholders,  in  exchange  for  their  paying or obtaining the written
        release of approximately $1,032,588 of company debt owed  to  the  Boyds
        and  other  creditors  -

          -  our  rubber  business  and  related  assets,

          -  50,000  shares  of  post-consolidation  stock,  and

          -  100,000  Common Stock Purchase Warrants exercisable for one year at
             $1.25  a warrant.

Item  5.  Market  for  Common  Equity  and  Related  Stockholder  Matters.

     Our common stock was admitted to trading on the OTC Bulletin Board on April
17, 2002.  Its stock symbol initially was "SOFS."  On August 15, 2003 the symbol
was  changed  to  "TSET".  The  following table shows the quarterly high and low
prices  of  the  stock  since  it was admitted to trading through June 30, 2003,
which  was  before  the  stock  symbol  change.  The prices reflect inter-dealer
quotations  without  mark-up,  mark-down  or  commissions  and may not represent
actual  transactions.

<TABLE>
<CAPTION>
                                        High               Low
                                        ----               ---
          Calendar  2002:
<S>                                     <C>                <C>
                 2nd  Qtr               0.51               0.11
                 3rd  Qtr               0.25               0.06
                 4th  Qtr               0.17               0.05

                                        9
<PAGE>
          Calendar  2003:
                 1st  Qtr               0.1                0.1
                 2nd  Qtr               0.1                0.05
                 3rd  Qtr               5.4                0.08
</TABLE>

     There  are  approximately  173  holders  of  record of our company's common
stock.

     Our  company  has  declared no dividends on our common stock.  There are no
restrictions that would or are likely to limit the ability of our company to pay
dividends  on  its  common  stock,  but we have no plans to pay dividends in the
foreseeable future and intend to use earnings for the expansion of our business.

Recent  Sales  of  Unregistered  Securities
-------------------------------------------+

     During  the  past  three  years  Softstone  sold shares of its Common Stock
without  registering  them  as  follows:

<TABLE>
<CAPTION>
                                                                   Amount  of
Date                Amount       Purchasers                        Consideration     Type  of  Consideration
---                 ------       ----------                        -------------     -----------------------
<S>                <C>           <C>                                  <C>            <C>
07/99 to 07/00       250,000     Employees  and  consultants(1)       $212,500       Services
                      22,500     Employee(1)                            22,490       Services  and  vehicles
                     400,000     Officers(1)                           383,097       Cash and cancellation of notes payable
                     210,000     Employees(1)                          210,000       Services
                     423,190     Rule  405  Offering                   503,782       Cash
07/00  to  07/01      42,500     Rule  405  Offering                    53,125       Cash
                     675,000     Warrant  Holders(2)                       675       Cash
                     300,000     Officer(2)                             21,922       Assignment  of  Patent
                      18,000     Officer(2)                             18,525       Office  equipment
                     522,961     Consultants(2)                         52,296       Services
                     277,100     Rule  506  Offering                    47,944       Cash
07/01  to  07/02     545,200     Rule  506  Offering                   254,520       Cash
                     825,075     Rule  506  Offering                   322,247       Services
                      52,250     Rule  506  Offering                    24,290       Cancellation  of  Interest on Debt
                   1,158,387     Rule  506  Merger                       1,158       Corporate  shell
07/02  to  07/03     293,000     Rule  506  Offering                    37,234       Cash
                     300,000     Settle  notes  payable                 18,000       Extinguish  notes payable
----------------------------
</TABLE>

     (1)  Sold  in  an  offering  exempt  from  registration  pursuant  to  the
          provisions  of Regulation D, Rule 504. The 504 offering was registered
          with  the  securities  regulatory  authorities  in  each  state  where
          securities  were  sold.

     (2)  Sold  in  an  offering  exempt  from  registration  pursuant  to  the
          provisions  of  Regulation  D,  Rule  506.  All purchasers were either
          "accredited  investors"  or,  if  not,  were  provided  with  offering
          materials  that met the requirements of a Form SB-2 offering circular.
          All  purchasers  were provided with an opportunity to ask questions of
          management  before  making  their  investment  decisions.


                                       10
<PAGE>

Item  6.  Management's  Discussion  and  Analysis.

     The  following  discussion  and analysis should be read in conjunction with
the  financial statements and the accompanying notes thereto and is qualified in
its  entirety  by  the  foregoing  and  by  more  detailed financial information
appearing  elsewhere.  See  "Financial  Statements."

     Results  of  operations.
     ------------------------

     The  following  table  presents, as a percentage of sales, certain selected
financial  data  for each of fiscal years ended June 30, 2002 and June 30, 2003:

<TABLE>
<CAPTION>
                                                         Fiscal Year Ended
                                                         -----------------
                                                    06-30-2002     06-30-2003
                                                    ----------     ----------
<S>                                                  <C>             <C>
Sales                                                   100%            100%
Operating expenses                                    2,007%            241%
                                                     ------           -----
Income from operations                               (1,907)%          (141)%
Other expenses                                       (1,038)%            64%
                                                     ------           -----
Net income (loss)                                    (2,945)%          (206)%
Net loss per share(1)                                $(3.90)         $(0.69)
----------------------
</TABLE>

     (1)  Based  on  each  21.8045  shares  outstanding on August 14, 2003 being
          consolidated  to  one  share.

     Sales

     Sales of $37,490 for fiscal year 2002 increased by $72,589, or 194 percent,
to  sales  of $110,079 in fiscal 2003.  The increase is due to our importing and
reselling  in  the  U.S.  crumb  rubber  from  India.

     Operating  expenses

     Operating  expenses  decreased  to $265,721 in fiscal 2003 from $752,324 in
fiscal  2002.  This 65 percent decrease is attributed primarily to fiscal 2002's
purchase  of,  and  research  conducted  prior  to,  the  purchase of the Levgum
Devulcanization  Technology  as  well  as our decision to discontinue our module
manufacturing  operations  in  Ardmore, storing the Parker System at a rent free
facility  and  our  President  providing  our  office  rent  free at our current
address,  111  Hilltop  Lane,  Pottsboro,  TX.

     Net  income  (loss)

     Our  net  loss  of $226,365 in fiscal 2003 is a marked improvement from our
net  loss  of  $1,104,133 in fiscal 2002.  This improvement is attributed to the
company's purchasing the rights to a foreign patent for $250,000, which purchase
had  to  be expensed as the patent has not been appraised, and our discontinuing
our  pilot  plant  operations in Ardmore, Oklahoma and storing our manufacturing
equipment,  thus  further  lowering  our  operating  expenses.

                                       11
<PAGE>

     Balance  sheet  items

     Current  assets  of  $3,554  on  June  30,  2003, compares unfavorably with
current  liabilities  of  $905,815 at that time, an unfavorable current ratio of
..004.

     Liquidity  and  Capital  Resources

     During  the  fiscal  year  ended June 30, 2003, we financed our net loss of
$226,365  primarily  through  -

-     sales  of  common  stock  for  $36,235  in  cash,
-     loans  of  $22,336,
-     the  sale  of  assets  totaling  $32,576,
-     the  receipt  of  $2,515  for  stock  to  be  issued,
-     depreciation  and  amortization  of  $67,271,
-     a  $17,741  loss  on  settlement  of  debt,  and
-     an  increase  in  accrued  expenses  of  $48,514.

     During  the  fiscal  year  ended June 30, 2002, we financed our net loss of
$1,104,133  primarily  through  -

-     sales  of  common  stock  for  $254,520  in  cash,
-     loans  of  $287,263,
-     the  issuance of $346,537 worth of common stock for services and interest,
-     depreciation  and  amortization  of  $83,307,
-     $125,000  loss  on  an  investment,  and
-     a  $214,444  loss  on  the  impairment  of  assets.

                                    OUTLOOK

     We  have been unable to raise funds for the renovation of our tire shredder
and the purchase of equipment that produces wire-free chips from shredded tires.
We were able, however, to raise $250,000 from the Boyds to acquire the exclusive
license  from  Levgum  for  the Western Hemisphere rights to its devulcanization
technology.  We  shifted our business emphasis to exploiting such license and to
brokering the sale of crumb rubber manufactured by other manufacturers.  We have
not  been able to achieve any significant success and have determined that it is
in  the  best  interests  of  our  shareholders  to  reorganize  our  company in
accordance  with  the  reorganization  agreement  with  TS  Electronics  (China)
described  herein.



                                       12
<PAGE>

Item  7.  Financial  Statements.
                                                                            Page
                                                                            ----

          Independent  Auditors'  Report  dated  September  17,  2003         13
          Independent  Auditors'  Report  dated  October  15,  2001           14
          Balance Sheet June 30, 2003                                         15
          Statements  of  Operations  from  October  7,  1998
            (Inception)  through  June  30,  2003                             16
          Statements  of  Stockholders'  Equity  (Deficit)
            from  October  7,  1998  (Inception)  through
            June  30,  2003                                                   17
          Statements  of  Cash  Flows  from  October  7,  1998
            (Inception)  through  June  30,  2003                             18
          Notes to the Financial Statements                                   19



















                                       13
<PAGE>

                          INDEPENDENT AUDITORS' REPORT


To  the  Stockholders  and  Board  of  Directors
TS  Electronics,  Inc.  (formerly,  Softstone,  Inc.)

We  have  audited  the  accompanying  balance  sheet  of  TS  Electronics,  Inc.
(formerly,  Softstone,  Inc.)  as of June 30, 2003 and the related statements of
operations,  stockholders'  deficit  and cash flows for the years ended June 30,
2003  and  2002.  These  financial  statements  are  the  responsibility  of the
Company's  management.  Our  responsibility  is  to  express an opinion on these
financial  statements  based  on  our  audits.

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

In  our  opinion,  the financial statements referred to above present fairly, in
all material respects, the financial position of TS Electronics, Inc. as of June
30,  2003  and  the  results  of its operations and its cash flows for the years
ended June 30, 2003 and 2002, in conformity with accounting principles generally
accepted  in  the  United  States  of  America.

The  Company's  financial  statements  are prepared using the generally accepted
accounting  principles  applicable  to  a  going concern, which contemplates the
realization  of  assets  and  liquidation of liabilities in the normal course of
business.  The  Company  had  accumulated deficit of $3,034,913 through June 03,
2003  and  negative working capital of $902,261 at June 30, 2003. These factors,
as  discussed  in  Note  10 to the financial statements, raise substantial doubt
about  the  Company's ability to continue as a going concern. Management's plans
in  regard  to  these  matters  are  also  described  in  Note 10. The financial
statements  do not include any adjustments that might result from the outcome of
this  uncertainty.


/s/  Kabani  &  Company,  Inc.

KABANI  &  COMPANY,  INC.
CERTIFIED  PUBLIC  ACCOUNTANTS

Fountain  Valley,  California
September  17,  2003


                                       14
<PAGE>



                          Independent Auditors' Report




Board  of  Directors
Softstone,  Inc.

We  have audited the accompanying statements of operations, stockholders' equity
(deficit), and cash flows for the year ended June 30, 2001 of Softstone, Inc. (a
development stage company). These financial statements are the responsibility of
the  Company's  management. Our responsibility is to express an opinion on these
financial  statements  based  on  our  audits.

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

In  our  opinion,  the financial statements of Softstone, Inc. referred to above
present  fairly,  in  all material respects, the results of its operations, cash
flows  and changes in stockholders' equity (deficit) for the year ended June 30,
2001  in  conformity with accounting principles generally accepted in the United
States  of  America.

As  discussed in Note 1 to the financial statements, the Company has been in the
development  stage  since  its  inception  on  October  7, 1998, and the primary
activities  include  establishing its operations and raising capital to fund its
activities.  The  Company  incurred  losses since inception to June 30, 2001, of
$1,704,415. Realization of a major portion of its assets and satisfaction of its
liabilities is dependent upon the Company's ability to meet its future financing
requirements  and  the  success  of  future  operations.   These  factors  raise
substantial  doubt  about  the Company's ability to continue as a going concern.
The  financial  statements  do not include any adjustments that might arise as a
result  of  this  uncertainty.

Hogan  and  Slovacek


/s/  Hogan  and  Slovacek

Oklahoma  City,  Oklahoma
October  15,  2001


                                       15
<PAGE>

                              TS Electronics, Inc.
                          (Formerly, Softstone, Inc.)
                                  BALANCE SHEET
                                  June 30, 2003


<TABLE>
<CAPTION>
                                     ASSETS

CURRENT  ASSETS:
<S>                                                                 <C>
     Cash & cash equivalents                                        $     1,789
     Accounts receivable                                                  1,765
                                                                    -----------
          Total current assets                                            3,554

PROPERTY AND EQUIPMENT, net                                             295,074
                                                                    -----------

                                                                    $   298,628
                                                                    ===========


                      LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT  LIABILITIES:
     Accounts payable                                               $    29,311
     Accounts payable-related party                                     160,879
     Accrued expenses                                                    76,879
     Notes payable - current                                            638,746
                                                                    -----------
          Total current liabilities                                     905,815

LONG  TERM  LIABILITIES
     Notes payable - long term                                          126,773
                                                                    -----------
          Total liabilities                                           1,032,588

CONTINGENCY

STOCKHOLDERS'  DEFICIT
     Common  stock,  $0.001  par  value;  30,000,000
       shares  authorized; 350,155 shares issued
       and outstanding                                                      350
     Additional paid-in capital                                       2,294,088
     Shares to be issued                                                  6,515
     Accumulated deficit                                             (3,034,913)
                                                                    -----------
          Total stockholders' deficit                                  (733,960)
                                                                    -----------

                                                                    $   298,628
                                                                    ===========
</TABLE>






   The accompanying notes are an integral part of these financial statements.


                                       16

<PAGE>
                              TS Electronics, Inc.
                          (Formerly, Softstone, Inc.)
                            STATEMENTS OF OPERATIONS
                   FOR THE YEARS ENDED JUNE 30, 2003 AND 2002


<TABLE>
<CAPTION>
                                                         Year Ended June 30,
                                                         2003          2002
                                                    -----------   ------------
<S>                                                 <C>           <C>
Net revenues                                        $   110,079   $     37,490


Operating  expenses
     General  and  administrative                       265,721        752,324
                                                    -----------   ------------

Operating loss                                         (155,642)      (714,834)

Other  income  (expense):
     Miscellaneous  Income                                  159              -
     Interest  expense                                  (46,191)       (49,855)
     Loss  on  sale  of  assets                         (17,741)             -
     Loss  on  settlement  of  debt                      (6,950)             -
     Loss  on  investment                                     -       (125,000)
     Loss  on  impairment  of  intangibles                    -       (214,444)
                                                    -----------   ------------
          Total  other  income  (expense)               (70,723)      (389,299)
                                                    -----------   ------------

Net loss                                            $  (226,365)  $  (1,104,133)
                                                    ===========   =============

Basic  and  diluted  weighted  average  number
  of  common  stock  outstanding                        326,941         283,176
                                                    ===========   =============

Basic  and diluted net loss per share               $     (0.69)  $       (3.90)
                                                    ===========   =============
</TABLE>



   The accompanying notes are an integral part of these financial statements.


                                       17
<PAGE>

                              TS Electronics, Inc.
                          (Formerly, Softstone, Inc.)
                      STATEMENTS OF STOCKHOLDERS' DEFICIT
                   FOR THE YEARS ENDED JUNE 30, 2003 AND 2002

<TABLE>
<CAPTION>
                            Common Stock      Additional     Stock                                      Total
                         -----------------
                         Number of             Paid-In       to be      Unearned       Accumulated   Stockholders'
                          shares    Amount     Capital       issued    Compensation     Deficit        Deficit
                         ---------  ------   ------------  ----------  ------------    ------------  -------------
<S>                      <C>        <C>      <C>            <C>         <C>            <C>           <C>
Balance  July 1, 2001    205,740    $ 4,486  $1,632,528     $     -     $        -     $(1,704,415)  $  (67,401)

Share issued for cash
  ($8.72/shr)             11,158        243      97,077           -               -              -       97,320
Shares issued for cash
  ($10.90/shr)            13,272        290     144,410           -               -              -      144,700
Shares issued for cash
  ($21.80/shr)               573         13      12,487           -               -              -       12,500
Share issued for service
  ($7.85/shr)             11,790        257      92,290           -               -              -       92,547
Share issued for service
  ($8.72/shr)             24,903        543     216,657           -               -              -      217,200
Share issued for service
  ($10.90/shr)             1,147         25      12,475           -               -              -       12,500
Share issued for interest
  ($9.81/shr)              2,396         52      24,238           -               -              -       24,290
Shares issued for merger  53,126      1,158           -           -               -              -        1,158
Shares  to  be  issued
  for  cash  ($7.20/shr)       -          -           -         999               -              -          999
Shares  to  be  issued
  for  loan  incentive
  ($8.72/shr)                  -          -           -       2,000               -              -        2,000
Cancellation of shares    (1,147)       (25)          -           -               -              -          (25)

Net  loss                      -          -           -           -               -     (1,104,133)  (1,104,133)
                         ---------  ------   ------------  ----------  ------------    ------------  -------------

Balance June 30, 2002    322,959      7,042   2,232,162       2,999               -     (2,808,548)    (566,345)

Reverse  stock  split
  21.8045:1  on
  August 14, 2003              -     (7,288)      7,288           -               -              -            -

Shares issued for cash    12,841        280      35,955           -               -              -       36,235

Stock issued for
  settlement of notes
  payable                 13,759        300      17,700           -               -              -       18,000

344 Shares of common
  stock to be issued
  for cash                     -          -           -       2,515               -              -        2,515

Shares  issued  for
  cash  included  in
  the prior period           138          3         996        (999)              -              -            -

Adjustment  to
  share  price               459         13         (13)          -               -              -            -

1147  Shares  of
  common  stock  to
  be  issued  for
  loan  incentive              -          -           -       2,000               -              -        2,000

Net  loss                      -          -           -           -               -       (226,365)    (226,365)
                         -------    -------  ----------     -------     -----------    -----------   ----------

Balance June 30, 2003    350,155    $   350  $2,294,088     $ 6,515     $         -    $(3,034,913)  $ (733,960)
                         =======    =======  ==========     =======     ===========    ===========   ==========
</TABLE>


   The accompanying notes are an integral part of these financial statements.


                                       18

<PAGE>
                              TS Electronics, Inc.
                          (Formerly, Softstone, Inc.)
                            STATEMENTS OF CASH FLOWS
                   FOR THE YEARS ENDED JUNE 30, 2003 AND 2002

<TABLE>
<CAPTION>
                                                      Year  Ended     Year  Ended
                                                         June 30,       June 30,
                                                          2003           2002
                                                      ----------   ------------
CASH  FLOWS  FROM  OPERATING  ACTIVITIES:
<S>                                                   <C>          <C>
     Net loss                                         $ (226,365)  $ (1,104,133)
     Adjustments  to  reconcile  net  loss
     to net cash used in operating  activities:
          Loss  on  sale  of  assets                      17,741              -
          Loss  on  settlement  of  debt                   6,950              -
          Depreciation  and  amortization                 67,271         83,307
          Issuance of common stock for compensation            -              -
          Issuance  of  common  stock  for
          services  and  interest                              -        346,537
          Issuance  of  common stock for merger                -          1,133
          Shares  to be issued for loan incentive          2,000          2,000
          Loss  on  investment                                 -        125,000
          Loss  on  impairment  of  assets                     -        214,444
          Write-off  of  samples                               -              -
          Decrease  of  other  current  assets                 -          4,473
          (Increase)  decrease  of  accounts
          receivable                                         818         (2,583)
          Increase (decrease) of accounts payable        (10,055)        22,368
          Increase  in  accrued  expense                  48,514          8,252
                                                      ----------   ------------
               Total adjustments                         133,239        804,931
                                                      ----------   ------------
          Net cash used in operating activities          (93,126)      (299,202)
                                                      ----------   ------------

CASH  FLOWS  FROM  INVESTING  ACTIVITIES
         Purchase  of  patents/investment                      -       (250,000)
         Other                                                 -              -
         Receipt  of  cash  on  disposal
           of  property  and  equipment                   32,576              -
                                                      ----------   ------------
         Net cash provided (used) in
           investing activities                           32,576       (250,000)
                                                      ----------   ------------

CASH  FLOWS  FROM  FINANCING  ACTIVITIES:
          Proceeds  from  borrowings                      22,336        287,263
          Payments  on  borrowings                             -         (5,000)
          Issuance of common stock for cash               36,235        254,520
          Receipt of cash for stock to be issued           2,515            999
                                                      ----------   ------------
          Net cash provided by financing activities       61,086        537,782
                                                      ----------   ------------

Net increase (decrease) in cash  & cash equivalents          536        (11,420)

CASH  &  CASH  EQUIVALENTS,  BEGINNING                     1,253         12,673
                                                      ----------   ------------

CASH & CASH EQUIVALENTS, ENDING                       $    1,789   $      1,253
                                                      ==========   ============
</TABLE>









   The accompanying notes are an integral part of these financial statements.


                                       19

<PAGE>
                              TS ELECTRONICS, INC.
                          (Formerly, Softstone, Inc.)
                        NOTES TO THE FINANCIAL STATEMENTS

1.   ORGANIZATIONS  AND  DESCRIPTION  OF  BUSINESS

     TS  Electronics,  Inc.  (formerly,  Softstone,  Inc.)  (the  "Company"),  a
     Delaware  corporation, was incorporated on October 7, 1998. The Company was
     formed  to  manufacture  a  patented  rubber  product  used in the road and
     building  construction  industries. Its principal activities have consisted
     of  financial  planning,  establishing  sources  of  production and supply,
     developing  markets,  and  raising capital. Prior to July 2002, the Company
     was  in  the development stage as defined Statement of Financial Accounting
     Standards  No.  7   "Accounting   and   Reporting   by   Development  Stage
     Enterprises". Its principal operations began in the quarter ended September
     30,  2002.  On  August  13,  2003,  the  Company  changed  its  name  to TS
     Electronics,  Inc.

     On October 7, 1998, SoftStone Building Products, Inc. ("SSBI" - an Oklahoma
     corporation and predecessor to the Company) was incorporated. Effective May
     31,  1999,  SSBI  was merged into Softstone, Inc. (incorporated January 28,
     1999  under  the  laws  of the State of Delaware) and SSBI was subsequently
     dissolved.  Each share of previously outstanding common stock was converted
     into  2,500  shares  of  common  stock  of  the  new  entity.

     On  July  24,  2001,  the  Company  entered  into  a plan of reorganization
     involving  Kilkenny Acquisition Corp. (Kilkenny) whereby the Company is the
     survivor  and  in  control  of the board of directors. The merger agreement
     provided for the exchange of 1,158,387 shares of the Company's common stock
     for  all  the  common stock of Kilkenny. In connection with this merger, on
     April  4,  2001,  certain  insider  shareholders of the Company contributed
     3,947,698  shares of their common stock to the Company effectively reducing
     the  then  outstanding  shares  of stock to 3,685,992. Subsequent issues of
     common  stock  for cash and services increased the outstanding stock of the
     Company  to  4,590,646.  The  issuance of the above mentioned shares of the
     Company's common stock on the merger date increased the common stock of the
     Company  to  5,669,033  with the Company shareholders, prior to the merger,
     owning  approximately  81%  of  the  outstanding shares of the Company. For
     accounting  purposes,  the transaction between the Company and Kilkenny has
     been treated as a re-capitalization of the Company, with the Company as the
     accounting  acquirer (reverse acquisition), and has been accounted for in a
     manner  similar  to  a  pooling  of  interests. Since Kilkenny is a dormant
     entity  with  insignificant assets or liabilities, no pro forma information
     is  presented.

2.   SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES

     Cash  and  cash  equivalents

     The  Company  considers all highly liquid debt instruments with an original
     maturity  of  three  months  or  less  to  be  cash  equivalents.

     Property  and  equipment

     Property  and  equipment  are  stated at cost. Expenditures for repairs and
     maintenance  are  charged to expense as incurred. Upon sale, retirement, or


                                       20
<PAGE>
                              TS ELECTRONICS, INC.
                          (Formerly, Softstone, Inc.)
                        NOTES TO THE FINANCIAL STATEMENTS


     other  disposition,  the  cost  and  related  accumulated  depreciation are
     removed  from  the  accounts and any resulting gain or loss is reflected in
     operations  for  the period. The Company depreciates property and equipment
     using  the  straight-line  method over their estimated useful lives ranging
     from  five  to  seven  years.

     Long-lived  assets to be held and used are reviewed for impairment whenever
     events  or  changes  in  circumstances  indicate  that the related carrying
     amount  may  not  be  recoverable.  When  required,  impairment  losses are
     recognized  based  upon  the  estimated  fair  value  of the asset. Being a
     development stage company, the Company does not believe any of its property
     and  equipment  is  impaired.

     Patent  and  patent  license  agreement

     In  August  2000,  patent  rights  amounting  to $100,000 were acquired, in
     exchange  for  300,000  shares  of  common  stock,  forgiveness of debt and
     assumption  of  additional  debt.  Patent  rights  were  acquired  for  the
     manufacturing process and had been amortized using the straight-line method
     over  fifteen years. In March 2002, additional patent rights were purchased
     for  $125,000.  The  net  book value of $89,444 for the patent purchased in
     2000  and  the  newly  purchased  patent  of  $125,000  were written off as
     impairment  of  intangible  assets  in the year ended June 30,, 2002 as the
     Company  decided  against  selling  the  items  under  patent  rights.

     Revenue  recognition

     The  Company's  revenue  recognition  policies are in compliance with Staff
     Accounting  Bulletin  (SAB)  101. Revenue is recognized when merchandise is
     shipped  to  a  customer.

     Income  taxes

     Deferred income taxes are provided on temporary differences between the tax
     basis  of  an  asset  or liability and its reported amount in the financial
     statements  that  will  result  in  taxable or deductible amounts in future
     years.  Deferred  income tax assets or liability are determined by applying
     the  presently  enacted  tax  rates  and  laws.

     Fair  value  of  financial  instruments

     The carrying amount of all financial instruments at June 30, 2003 and 2002,
     which  consist  of  various notes and loans payable, approximate their fair
     values.

     Accounts  payable  -  related  party

     The  Company  has an amount payable to a shareholder amounting $160,879 for
     certain  equipment purchased in prior years. The amounts are due on demand,
     unsecured  and  interest  free.


                                       21

<PAGE>

                              TS ELECTRONICS, INC.
                          (Formerly, Softstone, Inc.)
                        NOTES TO THE FINANCIAL STATEMENTS


     Earnings  per  share

     Net  loss  per  share  is  calculated  in  accordance with the Statement of
     financial  accounting  standards  No.  128  (SFAS  No.  128), "Earnings per
     share".  Basic net loss per share is based upon the weighted average number
     of  common  shares  outstanding. Diluted net loss per share is based on the
     assumption  that  all  dilutive  convertible  shares and stock options were
     converted or exercised. Dilution is computed by applying the treasury stock
     method. Under this method, options and warrants are assumed to be exercised
     at  the beginning of the period (or at the time of issuance, if later), and
     as  if  funds  obtained  thereby  were used to purchase common stock at the
     average  market  price  during  the  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 the reported amounts of assets and liabilities and
     disclosure  of  contingent  assets  and  liabilities  at  the  date  of the
     financial  statements  and  the  reported  amounts of revenues and expenses
     during  the  reporting  period.  Actual  results  could  differ  from those
     estimates.

     Stock-based  compensation

     SFAS  No.  123  prescribes  accounting  and  reporting  standards  for  all
     stock-based   compensation   plans,   including  employee  stock   options,
     restricted  stock,  employee  stock  purchase  plans and stock appreciation
     rights. SFAS No. 123 requires compensation expense to be recorded (i) using
     the  new  fair  value  method  or  (ii) using the existing accounting rules
     prescribed  by  Accounting Principles Board Opinion No. 25, "Accounting for
     stock  issued  to  employees"  (APB  25)  and  related interpretations with
     proforma  disclosure  of  what net income and earnings per share would have
     been  had  the  Company  adopted the new fair value method. The Company has
     chosen  to account for stock-based compensation using Accounting Principles
     Board  Opinion  No.  25, "Accounting for Stock Issued to Employees" and has
     adopted  the   disclosure  only   provisions  of  SFAS  123.   Accordingly,
     compensation  cost  for stock options is measured as the excess, if any, of
     the  quoted  market  price  of the Company's stock at the date of the grant
     over  the  amount  an  employee  is  required  to  pay  for  the  stock.

     The  Company  accounts for stock-based compensation issued to non-employees
     and  consultants  in  accordance  with  the  provisions of SFAS 123 and the
     Emerging  Issues  Task  Force consensus in Issue No. 96-18, "Accounting for
     Equity Instruments that are Issued to Other Than Employees for Acquiring or
     in  Conjunction  with  Selling, Goods or Services". Valuation of shares for
     services  is based on the estimated fair market value of the shares issued.

     As  of  June  30,  2003,  the  Company  does  not have any option for share
     purchase  or  warrant  outstanding.


                                       22
<PAGE>
                              TS ELECTRONICS, INC.
                          (Formerly, Softstone, Inc.)
                        NOTES TO THE FINANCIAL STATEMENTS


     Segment  Reporting

     Statement  of   Financial  Accounting  Standards  No.  131   ("SFAS  131"),
     "Disclosure  About  Segments  of  an  Enterprise  and  Related Information"
     requires  use of the "management approach" model for segment reporting. The
     management  approach  model  is  based  on  the  way a company's management
     organizes  segments  within  the company for making operating decisions and
     assessing  performance.  Reportable  segments  are  based  on  products and
     services,  geography,  legal  structure, management structure, or any other
     manner in which management disaggregates a company. Currently, SFAS 131 has
     no   effect  on   the  Company's  consolidated   financial   statements  as
     substantially all of the Company's operations are conducted in one industry
     segment.

     Accounting  developments

     In  December 2002, the FASB issued SFAS No. 148 "Accounting for Stock Based
     Compensation-Transition  and Disclosure". SFAS No. 148 amends SFAS No. 123,
     "Accounting  for  Stock Based Compensation", to provide alternative methods
     of  transition  for  a  voluntary  change to the fair value based method of
     accounting  for  stock-based  employee  compensation.   In  addition,  this
     Statement  amends  the  disclosure requirements of Statement 123 to require
     prominent disclosures in both annual and interim financial statements about
     the  method  of  accounting  for  stock-based employee compensation and the
     effect  of  the  method  used,  on  reported  results.   The  Statement  is
     effective  for  the  Companies' interim reporting period ending January 31,
     2003.  The  adoption  of  SFAS  148  does not have a material effect on the
     earnings  or  financial  position  of  the  Company.

     On April 30, the FASB issued FASB Statement No. 149 (FAS 149), Amendment of
     Statement  133  on  Derivative  Instruments and Hedging Activities. FAS 149
     amends  and clarifies the accounting guidance on (1) derivative instruments
     (including  certain derivative instruments embedded in other contracts) and
     (2) hedging activities that fall within the scope of FASB Statement No. 133
     (FAS  133),  Accounting  for Derivative Instruments and Hedging Activities.
     FAS  149  also  amends  certain  other  existing pronouncements, which will
     result  in  more  consistent reporting of contracts that are derivatives in
     their entirety or that contain embedded  derivatives  that warrant separate
     accounting. FAS 149 is effective (1) for contracts entered into or modified
     after  June  30,  2003,  with  certain  exceptions,  and  (2)  for  hedging
     relationships designated after June 30, 2003. The guidance is to be applied
     prospectively.  The Company does not expect the adoption of SFAS No. 149 to
     have  a  material impact on its financial position or results of operations
     or  cash  flows.

     On  May  15,  2003,  the Financial Accounting Standards Board (FASB) issued
     FASB  Statement  No.  150  (FAS  150),  Accounting  for  Certain  Financial
     Instruments  with  Characteristics  of both Liabilities and Equity. FAS 150
     changes  the  accounting  for  certain  financial  instruments  that, under
     previous  guidance, could be classified as equity or "mezzanine" equity, by
     now  requiring those instruments to be classified as liabilities (or assets
     in some circumstances) in the statement of financial position. Further, FAS
     150  requires  disclosure  regarding  the  terms  of  those instruments and
     settlement  alternatives. FAS 150 affects an entity's classification of the
     following  freestanding  instruments: a) Mandatorily redeemable instruments
     b)  Financial  instruments to repurchase an entity's own equity instruments
     c)  Financial  instruments  embodying  obligations  that the issuer must or
     could  choose to settle by issuing a variable number of its shares or other
     equity  instruments  based  solely  on (i) a fixed monetary amount known at
     inception  or  (ii)  something  other  than  changes  in  its  own  equity
     instruments  d)  FAS 150 does not apply to features embedded in a financial
     instrument  that  is  not a derivative in its entirety. The guidance in FAS
     150  is  generally  effective for all financial instruments entered into or


                                       23

<PAGE>

                              TS ELECTRONICS, INC.
                          (Formerly, Softstone, Inc.)
                        NOTES TO THE FINANCIAL STATEMENTS


     modified after May 31, 2003, and is otherwise effective at the beginning of
     the  first  interim  period  beginning  after  June  15,  2003. For private
     companies,  mandatorily redeemable financial instruments are subject to the
     provisions  of  FAS  150 for the fiscal period beginning after December 15,
     2003.  The  Company  does not expect the adoption of SFAS No. 150 to have a
     material  impact on its financial position or results of operations or cash
     flows.

     Reclassifications

     Certain  amounts in the 2002 financial statements have been reclassified to
     conform  with  the  2003  presentation.

3.   PROPERTY  AND  EQUIPMENT

     Property  and  equipment  consist  of  the  following  at  June  30,  2003:

<TABLE>
<CAPTION>
<S>                                                 <C>
          Furniture  and  computer  equipment       $   42,198
          Production  and  other  equipment            450,063
          Vehicles                                      29,381
                                                    ----------
                                                       521,642

          Less:  Accumulated  depreciation
                 and  amortization                    (226,568)
                                                    ----------
                                                    $  295,074
                                                    ==========
</TABLE>

4.   NOTES  PAYABLE

     Notes  payable  consist  of  the  following  at  June  30,  2003:
<TABLE>
<CAPTION>
          Revolving  note  payable  to  bank;
<S>                                                            <C>
          interest rate  7.5%,  due on December 05, 2005       $  88,468

          Notes payable to stockholder, 8% & 12%
          interest  rates  and  due  on  demand                  600,889

          Bank  term loan; 6.78% interest rate;
          Maturing  September  13,  2003                          37,857

          Note payable to finance vehicle, 9.5%
          interest rate, maturing September 23, 2005,
          collaterized  by  vehicle                               12,974

          Bank  term  loan;  interest  at 6.25%
          (variable);  collateralized  by
          equipment, accounts  receivable
          and intangibles and  guaranteed
          by  the  principal stockholder
          of  the  Company,  due  July 15, 2005                   25,331


                                       24
<PAGE>
                              TS ELECTRONICS, INC.
                          (Formerly, Softstone, Inc.)
                        NOTES TO THE FINANCIAL STATEMENTS


          Note payable to stockholder; interest
          free; due  on  demand                                  160,879
                                                               ---------
                                                                 926,398

          Less:  current  portion                                799,625
                                                               ---------

          Long-term  debt                                      $ 126,773
                                                               =========
</TABLE>

     The  following is a summary of maturities of principal under long-term debt
     for  years  ending  June  30:
<TABLE>
<CAPTION>
<S>                                                            <C>
          2006                                                 $ 126,773
                                                               =========
</TABLE>

     The notes payable has been classified in the balance sheet at June 30, 2003
     as per  follows:
<TABLE>
<CAPTION>
<S>                                                            <C>
          Accounts  payable  -  related parties                $ 160,879
          Notes  payable-  current                               638,746
                                                               ---------
          Current  liabilities                                   799,625
          Notes  Payable  -  long  term                          126,773
                                                               ---------

                                                               $ 926,398
                                                               =========
</TABLE>

5.  SUPPLEMENTAL  DISCLOSURE  OF  CASH  FLOWS

     The Company prepares its statements of cash flows using the indirect method
     as  defined  under  the  Financial  Accounting  Standard  No.  95.

     The  Company paid $0 for income tax during the year ended June 30, 2003 and
     2002.  The  Company paid $13,898 and $31,318 interest during the year ended
     June  30,  2003 and 2002, respectively.

     Supplemental  disclosure  of  non-cash  investing and financing activities:

     The  cash  flow  statements do not include following non-cash investing and
     financing  activities:

     During  the  year  ended June 30, 2003, the Company issued 13,759 shares of
     common  stock  valued at $18,000 for settlement of short-term notes payable
     amounting  $11,050  resulting  in  a  loss of $6,950 on settlement of debt.

6.   STOCKHOLDERS'  EQUITY

     Common  stock

     During  the  year  ended June 30, 2003, the Company issued common stocks in
     exchange  of  various  services  to  following  parties:


                                       25
<PAGE>
                              TS ELECTRONICS, INC.
                          (Formerly, Softstone, Inc.)
                        NOTES TO THE FINANCIAL STATEMENTS


     During  the  year  ended June 30, 2003, the Company issued 12,841 shares of
     common stock for cash of $36,235 received during this period and issued 138
     shares  for  cash  amounting  $999  received  in  the  prior  year.

     During  the  year  ended June 30, 2003, the Company issued 13,759 shares of
     common  stock  valued at $18,000 for settlement of short-term notes payable
     amounting  $11,050  resulting  in  a  loss of $6,950 on settlement of debt.

     During  the  year  ended June 30, 2003, the Company received cash of $2,515
     for  344  shares  to  be  issued.

     During  the  year  ended  June  30,  2003, the Company issued 459 shares of
     common  stock  for  the  adjustment  to  share  price  in  the  prior year.

     At  June  30,  2003, the Company has 1,147 shares of common stock amounting
     $2,000  to  be  issued  for  the  extension  of  the due date for the loan.

7.   INCOME  TAXES

     The  Company's  effective  income  tax  benefit  differed  from the benefit
     computed  using  the  federal  statutory  tax  rate  as  follows:

<TABLE>
<CAPTION>
                                                               Period  from
                                                           Year Ended June  30,
                                                            2003         2002
                                                        ----------    ---------
     Income  tax  benefit  at
<S>                                                     <C>           <C>
     federal statutory rate                             $   90,546    $ 375,405

     Nondeductible  expenses                                  (443)      (2,100)
     Other,  including graduated rates                           -            -
     Change  in  valuation  allowance                      (90,103)    (373,305)
                                                        ----------    ---------
                                                        $        -    $       -
                                                        ==========    =========
</TABLE>

Components  of  deferred  tax  assets  at  June  30,  2003,  are  as  follows:

<TABLE>
<CAPTION>
          Assets
<S>                                                             <C>
          Net  operating loss carryforward                      $ 1,072,101
          Valuation  allowance                                   (1,072,101)
                                                                -----------
                                                                $         -
                                                                ===========
</TABLE>

     The valuation allowance increased $90,103 for the year ended June 30, 2003,
     and  $373,305  for  the  year  ended  June  30,  2002.

     A  valuation  allowance is provided for deferred tax assets when it is more
     likely  than  not  that some portion or all of the deferred tax assets will


                                       26
<PAGE>
                              TS ELECTRONICS, INC.
                          (Formerly, Softstone, Inc.)
                        NOTES TO THE FINANCIAL STATEMENTS


     not  be realized. At June 30, 2003 and 2002, the Company had a net deferred
     tax  asset  mainly  related  to  a  net  operating  loss  carryforward from
     operating  losses incurred. As such carryforward can only be used to offset
     future  taxable income, management has fully reserved this net deferred tax
     asset  with  a  valuation  allowance  until it is more likely than not that
     taxable  income  will be generated. Net operating loss carryforwards can be
     carried  forward  for  fifteen  years  for  federal  tax purpose subject to
     certain  limitations  and  they  will  expire  in  the  year  2018.

8.   IMPAIREMENT  OF  INVESTMENT

     In  March  2002, the Company entered into a purchase agreement with Levgum,
     Ltd.  (Levgum)  of  Tel  Aviv, Israel, where the Company received 83 shares
     with  1.00 par value representing 10% of outstanding capital, for $250,000.
     The  Company  also  received  the  right to use their technology for rubber
     devulcanization and right to sublicense as part of this purchase agreement.
     The  Company  recorded  its  investment  in Levgum for $125,000 and license
     agreement  acquired  through acquisition at $125,000. On June 30, 2002, the
     Company  evaluated  its investment and patents rights according to FASB 121
     and  recognized  an  impairment  loss  equal  to  the  book  value of these
     intangible  assets  amounting  $125,000.

9.   BASIC  AND  DILUTED  NET  LOSS  PER  SHARE

     Basic  and  diluted  net loss per share for the six-month period ended June
     30,  2003  and 2002 were determined by dividing net loss for the periods by
     the  weighted  average  number  of basic and diluted shares of common stock
     outstanding.  Weighted  average  number of shares used to compute basic and
     diluted  loss per share is the same since the effect of dilutive securities
     is anti-dilutive.

10.  GOING  CONCERN

     The  accompanying  consolidated  financial statements have been prepared in
     conformity  with generally accepted accounting principles which contemplate
     continuation of the company as a going concern. However, the Company has an
     accumulated  deficit  of $3,034,913 at June 30, 2003 and a negative working
     capital  of  $902,261  at  June  30, 2003. In view of the matters described
     above,  recoverability  of  a  major  portion of the recorded asset amounts
     shown  in  the  accompanying  balance  sheet  is  dependent  upon continued
     operations  of  the  company, which in turn is dependent upon the Company's
     ability  to  raise  additional capital, obtain financing and succeed in its
     future  operations. The financial statements do not include any adjustments
     relating to the recoverability and classification of recorded asset amounts
     or amounts and classification of liabilities that might be necessary should
     the  Company  be  unable  to  continue  as  a  going  concern.

     Management's  plan of operations anticipates that the cash requirements for
     the  next  twelve  months  will  be  met by obtaining capital contributions
     through  the  sale  of common stock and cash flow from operations. However,
     there  is no assurance that the Company will be able to implement its plan.


                                       27
<PAGE>
                              TS ELECTRONICS, INC.
                          (Formerly, Softstone, Inc.)
                        NOTES TO THE FINANCIAL STATEMENTS


11.  SUBSEQUENT  EVENT  &  CONTINGENT  LIABILTY

     On July 31, 2003, the Company entered in to a reorganization agreement with
     TS  Electronics  Corporation  (TSEC),  a  Delaware  corporation.  Under the
     reorganization  agreement,   TSEC  shareholders  shall  purchase  from  the
     Company,  5,350,000 shares of its common stock in a private placement under
     rule  506 of the Regulation D of the Securities Act of 1933, in exchange of
     for the transfer to the Company of all the capital stock of TSEC. Under the
     agreement,  all of the directors of the Company will be replaced by present
     designee  of  TSEC  to  fill  this  vacancy  and become the director of the
     Company.

     Per  the  agreement,  TSEC and its shareholders shall be indemnified by the
     Company  against  any  liabilities  arising  either  from  a failure of the
     Company  or  its  current  president  to  discharge  all liabilities of the
     Company.  The  closing  of  the  agreement  will  be  effective  subject to
     compliance  of  Securities  and  Exchange filing  rules  and  regulations.

     Pursuant  to  the reorganization agreement, on August 13, 2003, the Company
     filed its Certificate of Amendment to Certificate of Incorporation with the
     Secretary  of  State  of  the  State  of  Delaware changing its name to "TS
     Electronics,  Inc."  and consolidating the common stock of the corporation.
     The  stock  consolidation  to  600,000  shares, $0.001 par value, effective
     August 14, 2003, consolidates each 21.8045 outstanding shares to one share,
     with  fractional  shares  being  rounded  up  or  down to the nearest whole
     number.













                                       28

<PAGE>

Item  8.     Changes  In  and  Disagreements  With Accountants on Accounting and
Financial  Disclosure.

     On  September  5,  2002  Hogan  &  Slovacek of Oklahoma City and Tulsa, our
principal  independent accountants, resigned.  Hogan & Slovacek had been engaged
as our principal independent accountants since August 22, 2001, when it replaced
Grant  Thornton  LLP  as our principal independent accountants.  See Softstone's
Form  8-K  filed  with  the  Commission  on August 27, 2001 (Commission File No.
000-29523).

     The  report  of  Hogan  & Slovacek on the financial statements of Softstone
(our  earlier name) for its fiscal year ended June 30, 2001 contained no adverse
opinions  or  disclaimers  of opinion, and, other than raising substantial doubt
about  Softstone's  ability  to  continue as a going concern for the fiscal year
ended June 30, 2001, were not otherwise modified as to uncertainty, audit scope,
or accounting principles during the period of its engagement (August 22, 2001 to
September  5,  2002)  or  the  interim  period to September 5, 2002, the date of
resignation.  Similarly,  the  reports  of  Grant  Thornton  on  the  financial
statements of Softstone contained no adverse opinions or disclaimers of opinion,
and,  other than raising substantial doubt about Softstone's ability to continue
as  a  going  concern for each of the fiscal years ended June 30, 2000 and 1999,
were  not  modified  as  to  uncertainty,  audit scope, or accounting principles
during such past two years or the interim period to August 21, 2001, the date of
resignation.

     During  the  past  two years or interim periods prior to September 5, 2002,
there were no disagreements between Softstone and either Grant Thornton or Hogan
&  Slovacek,  whether or not resolved, on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure which,
if  not  resolved  to Grant Thornton's or Hogan & Slovacek's satisfaction, would
have  caused  it to make reference to the subject matter of the disagreements in
connection  with  its  reports.

     On September 5, 2002, we engaged Kabani & Company, Inc. of Fountain Valley,
California  as  our new principal accountant to audit our consolidated financial
statements.

     The  decision  to  change  accountants  was recommended and approved by the
board  of  directors.

Item  9.  Directors,  Executive  Officers,  Promoters  and  Control  Persons.

     A list of our current officers, directors and significant employees appears
below.  The  directors  are  elected annually by the shareholders.  The officers
serve at the pleasure of the board of directors.  The directors do not presently
receive  fees  or  other  remuneration  for  their  services.




                                       29
<PAGE>
<TABLE>
<CAPTION>
                                                   Office Held     Term of
       Person                     Office              Since        Office
       ------                     ------           -----------     --------
<S>                        <C>                         <C>      <C>
Keith P. Boyd, 30          President                   2001     October 2003
                           Director                    2001     October 2003
Frederick W. Parker, 68    Director                    1999     October 2003
Gene F. Boyd, 65           Secretary                   1999     October 2003
                           Chairman of the Board
                             of Directors              1999     October 2003
</TABLE>

     Keith  P.  Boyd.  Mr.  Boyd  has spent most of his adult life assisting his
father,  Gene Boyd, with the family interests, Meinecke-Boyd, Inc., located near
Ardmore,  Oklahoma.  After  a year in college, he joined the U.S. Navy and ended
his  naval career as a petty officer - machinist mate 3rd class - aboard the USS
Chicago,  SSN  721, a nuclear-powered, fast-attack submarine.  In late 1998, Mr.
Boyd  raised  the  first  investor  capital  for Softstone.  He has considerable
mechanical  skills and abilities and assisted with the design and fabrication of
Softstone's  Parker  System  machine.   He  formulated  Softstone's  sales   and
marketing effort and has been responsible to date for all of its sales.  In June
2001  he  was elected president and CEO of Softstone, Inc. (the company's third)
and  then  merged  the  company  with a 12G reporting shell, making Softstone an
SEC-reporting public corporation.  Mr. Boyd negotiated our contract with Levgum,
Ltd.,  of Israel and restructured the company to incorporate the devulcanization
technology.  Keith Boyd has initiated the beginnings of a global market strategy
through  his  research  of  product  applications as well as market entries.  He
devotes  100  percent  of  his  time  to  the  affairs  of  our  company.

     Frederick  W.  Parker.  Mr.  Parker  attended  the  University  of Southern
California and the University of Wyoming.  From December 1969 to May 1980 he was
employed  as an executive and wholesaler of drilling fund securities of Canadian
American  Securities,  a subsidiary of American Quasar Petroleum.  From May 1980
to  June 1982 he founded and operated ENEX Securities and the ENEX Income Funds.
From  1982  to November 1984 he owned and operated Parker Energy Funding, a coal
methane  gas  company.  From 1986 to 1987 he was a consultant to several oil and
gas  production  companies  regarding deep well injection of hazardous oil field
waste.  From  June  1987  to October 1990 he was the executive vice president of
Princeton  Clearwater Corporation.  From 1990 to 1999 he operated the consulting
firm of Donner-Gray, primarily regarding oil and gas and real estate activities.
From  May  1996  to  September  1998  he  was  the  director  of marketing of VE
Enterprises, a manufacturing concern.  From October 1998 until June 1999 when it
was  merged  with  Softstone,  Inc., he was the president and owner of Softstone
International  LLC,  which  owned the patented technology for the manufacture of
rubber  modules,  which  patent  was  assigned  to  Softstone,  Inc.  Upon  the
incorporation  of  Softstone,  Inc. on January 28, 1999, he became its president
and  a  director.  He is still a director but resigned his position as president
in  May  2001.

     Gene  F.  Boyd.  Mr.  Boyd,  a  1960  graduate  of Texas Tech, has been the
president  of   Meinecke-Boyd,  Inc.,   an  Oklahoma  ranching   and  investment
corporation,  since  January  1979.  As  the  operator  of a 3600-acre Simmental
cattle ranch at Tishomingo, Oklahoma, Mr. Boyd practiced (and preached) holistic
resource  management,  which  included rotational grazing to enhance the natural

                                       30
<PAGE>

recycling of soil and grasses.  He also served as vice-president of the Oklahoma
Simmental  Association  and  as  a  board  member of soil and water conservation
districts.  Intrigued  by  the  potential  and  the  need  for  recycled  rubber
products, Mr. Boyd and his wife moved to Ardmore, Oklahoma after 26 years on the
ranch,  so  that  he  could  be  a  full-time  participant  in  the start-up and
development  of  Softstone,  Inc.  Upon the incorporation of Softstone, Inc., on
January 28, 1999, Mr. Boyd became its secretary and its chairman of the board of
directors,  positions  he  still  holds.

Item  10.  Executive  Compensation.

     No  executive officer of the company has received total compensation in any
of  the  last three years that exceeds $100,000.  The table below sets forth all
compensation  awarded  to,  earned  by, or paid to the presidents of the company
during  the  last  three  fiscal  years:

<TABLE>
<CAPTION>
                                                                                Securities
                                                  Other                         Underlying
                 Fiscal         Annual            Restricted      Options/          LTIP
Name              Year     Salary      Bonus     Compensation   Stock Awards        SARS        Payouts
----             ------    ------      -----     ------------   ------------    ----------      -------
<S>               <C>      <C>           <C>            <C>      <C>                  <C>          <C>
Keith  Boyd       2003     $36,000       0              0              0              0            0
Keith  Boyd       2002     $36,000       0              0        $50,000              0            0
Keith  Boyd       2001     $36,000       0              0        $20,000              0            0
Frederick Parker  2001           0       0              0              0              0            0
</TABLE>

Employment  Contracts

     We  have  no long-term compensation plans or employment agreements with any
of  our  officers  or  directors.

     There  are  no  employment  contracts,  compensatory plans or arrangements,
including payments to be received from our company, with respect to any director
or  executive  officer  which  would  in  any way result in payments to any such
person  because  of  his  or her resignation, retirement or other termination of
employment,  any change in control, or a change in the person's responsibilities
following  a  change  in  control  of  our  company.

Stock  Options

     There  have  been no stock options granted to the officers and directors of
our  company,  nor  have  there been any other forms of compensation paid to the
officers  and  directors  of  the  company.

Item  11.  Security  Ownership  of  Certain Beneficial Owners and Management.

     The  following  table  sets  forth certain information regarding beneficial
ownership  of  the  common  stock  of Softstone as of September 30, 2003 (giving
effect  to  the  one-for-each-21.8045  shares  of  stock consolidation), by each
officer  and director of our company, by each individual who is known, as of the
date of this filing, to be the beneficial owner of more than five percent of our
common  stock,  its only voting security, and by the officers and directors as a
group:


                                       31
<PAGE>

<TABLE>
<CAPTION>
                                 Amount  and
      Name and Address of         Nature of          Percent
        Beneficial Owner          Beneficial            of           Office
                                   Ownership          Class
      -------------------        ------------        -------         ------
<S>                                 <C>                <C>          <C>
Keith  P.  Boyd                      74,129            12.4         President
111  Hilltop  Lane                                                  Director
Pottsboro,  TX  75076

Frederick  W.  Parker                35,562             5.9         Director
811  N.  Rockford  Place
Ardmore,  OK  73401

Gene  F.  Boyd                      200,122            33.4         Secretary
712  Franklin  Court                                                Director
Ardmore,  OK  73401

Betty  Sue  Boyd                     25,015             4.2
612  Franklin  Court
Ardmore,  OK  73401

Officers and Directors as a Group
(3  persons)
                                    334,828            55.9
</TABLE>

(1)  Mr.  Parker's  shares  are held of record by the Frederick W. Parker Family
     Limited  Partnership.

(2)  Of  these  shares,  712,745  are  held  of  record  by  the  Gene  F.  Boyd
     Revocable  Living Trust, 10,000 shares are held of record by Meinecke/Boyd,
     Inc.,  a  company  under  the  control  of Mr. Boyd, and 27,551 are held of
     record  by  the  Betty  Sue  Boyd  Revocable  Living  Trust.

Item  12.  Certain  Relationships  and  Related  Transactions.

     During  fiscal years 2002 and 2003, the following outstanding notes payable
were  either  issued or renewed from earlier years.  In each instance, the notes
were  either guaranteed by Gene Boyd, who is a director and the secretary of our
company,  or  were issued to him and his spouse, Betty Sue Boyd, in exchange for
loans  of  money  to  the  company  by  them:

<TABLE>
<CAPTION>
         Revolving  note  payable  to  bank; interest
<S>                                                             <C>
         rate  7.5%,  due on December 05, 2005                  $  88,468

         Notes payable to stockholder, 8% & 12%
         interest  rates  and  due  on  demand                    600,889


                                       32
<PAGE>

         Bank  term loan; 6.78% interest rate;
         Maturing  September  13,  2003                            37,857

         Bank  term  loan;  interest  at 6.25%
         (variable);  collateralized  by equipment,
         accounts  receivable  and intangibles
         and  guaranteed  by  the  principal
         stockholder of  the  Company,  due  July 15, 2005         25,331

         Note payable to stockholder; interest
         free; due  on  demand                                    160,879
</TABLE>


     All  of the liabilities represented by the above notes shall be released as
a  condition  of  the  reorganization.

Item  13.  Exhibits  and  Reports  on  Form  8-K.

(a)  Exhibits

          The  following  exhibits  are filed, by incorporation by reference, as
part  of  this  Form  10-KSB:

     Exhibit                              Item
     -------                              ----

          2     Agreement  and  Plan of  Reorganization of July 24, 2001 between
                Softstone, Inc.  and  Kilkenny  Acquisition  Corp.*

          3     Certificate  of  Incorporation  of  Softstone  Inc.*

          3.1   Bylaws  of  Softstone,  Inc.*

         10     Lease Agreement of February 1, 2000, between Ardmore Development
                Authority,  as  lessor,  and  Softstone,  Inc.,  as  lessee.*

         10.1   Scrap  Tire  Disposal  Agreement  of  January 11, 2000,  between
                Michelin North  America,  Inc.,  and  Softstone,  Inc.*

         10.2   Letter  of  intent  of  May  1,  2001, of Little Elm Independent
                School District  regarding  the  Little  Elm  Walking  Trail.*

         10.3   Agreement  of  March  15,  2002  with  Levgum,  Inc.  concerning
                exclusive   license   to   Western   Hemisphere   for   Levgum's
                devulcanization  technology.**

         16.1   Letter of September 9,  2002  of  Hogan & Slovacek agreeing with
                the  statements  made  in Form 8-K by Softstone Inc., concerning
                Softstone's change of principal  independent  accountants.***


                                       33
<PAGE>

         31     Certification  of  Chief Executive Officer pursuant to 18 U.S.C.
                Section  1350,  as  adopted  pursuant  to  Section  302  of  the
                Sarbanes-Oxley Act of 2002.

         31.1   Certification  of   Chief  Financial  Officer  pursuant   to  18
                U.S.C. Section  1350,  as adopted pursuant to Section 302 of the
                Sarbanes-Oxley Act  of  2002.

         32     Certification  of  Chief Executive Officer pursuant to 18 U.S.C.
                Section  1350,  as  adopted  pursuant  to  Section  906  of  the
                Sarbanes-Oxley Act of 2002.

         32.1   Certification  of  Chief  Financial  Officer   pursuant   to  18
                U.S.C. Section  1350,  as adopted pursuant to Section 906 of the
                Sarbanes-Oxley Act  of  2002.

         99     United  States  Patent  No.  5,714,219.*

*     Previously  filed  with  Form  8-K  August  8,  2001  Commission  File No.
000-29523;  incorporated  by  reference.

**     Previously  filed  with  Form  10-QSB  May  20,  2002 Commission File No.
000-29523;  incorporated  by  reference.

***     Previously  filed  with  Form 8-K September 11, 2002 Commission File No.
000-29523;  incorporated  by  reference.


(b)  Forms  8-K

     Form  8-K  dated August 13, 2003, reporting Item 5 - Other Events, and Item
7(b)   -    Exhibits     (Commission   File   #000-29523,    EDGAR     Accession
#0001060830-03-000169  filed  August  18,  2003).

Item  14.  Controls  and  Procedures

     Evaluation of disclosure controls and procedures.  We maintain controls and
procedures  designed to ensure that information required to be disclosed in this
report  is  recorded, processed, accumulated and communicated to our management,
including  our chief executive officer and our chief financial officer, to allow
timely decisions regarding the required disclosure.  Within the 90 days prior to
the  filing  date  of this report, our management, with the participation of our
chief  executive  officer and chief financial officer, carried out an evaluation
of  the  effectiveness  of the design and operation of these disclosure controls
and  procedures.  Our  chief  executive  officer  and  chief  financial  officer
concluded,  as  of  fifteen  days  prior to the filing date of this report, that
these  disclosure  controls  and  procedures  are  effective.

     Changes  in  internal  controls.  Subsequent  to  the  date  of  the  above
evaluation,  we made no significant changes in our internal controls or in other
factors  that  could  significantly  affect  these controls, nor did we take any
corrective  action,  as  the  evaluation revealed no significant deficiencies or
material  weaknesses.


                                       34
<PAGE>

                                   SIGNATURES

In  accordance  with  Section  13  or  15(d) of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

Date:  October  10, 2003                TS Electronics, Inc. (formerly named
                                          Softstone  Inc.)

                                        By/s/Keith  Boyd
                                             -----------------------------------
                                             Keith  Boyd,  President

In  accordance  with  the Exchange Act, this report has been signed below by the
following  persons  on behalf of the registrant and in the capacities and on the
dates  indicated.


                                        /s/  Keith  Boyd
Date:  October  10,  2003               ----------------------------------------
                                        Keith Boyd, President,  Chief  Executive
                                          Officer  and  Director


                                        /s/  Gene  Boyd
Date:  October  10,  2003               ----------------------------------------
                                        Gene  Boyd,  Secretary  and  Director


                                        /s/  Keith  Boyd
Date:  October  10,  2003               ----------------------------------------
                                        Keith  Boyd,  Chief  Financial  Officer














                                       35
<PAGE>
                                        2
                              TS ELECTRONICS, INC.
                        Commission  File  Number  0-29523


                              Index to Exhibits to
                              Form 10-KSB 06-30-03

The following exhibits are filed, by incorporation by reference, as part of this
Form  10-KSB:

          2     Agreement  and  Plan of  Reorganization of July 24, 2001 between
                Softstone, Inc.  and  Kilkenny  Acquisition  Corp.*

          3     Certificate  of  Incorporation  of  Softstone  Inc.*

          3.1   Bylaws  of  Softstone,  Inc.*

         10     Lease Agreement of February 1, 2000, between Ardmore Development
                Authority,  as  lessor,  and  Softstone,  Inc.,  as  lessee.*

         10.1   Scrap  Tire  Disposal  Agreement  of  January 11, 2000,  between
                Michelin North  America,  Inc.,  and  Softstone,  Inc.*

         10.2   Letter  of  intent  of  May  1,  2001, of Little Elm Independent
                School District  regarding  the  Little  Elm  Walking  Trail.*

         10.3   Agreement  of  March  15,  2002  with  Levgum,  Inc.  concerning
                exclusive   license   to   Western   Hemisphere   for   Levgum's
                devulcanization  technology.**

         16.1   Letter of September 9,  2002  of  Hogan & Slovacek agreeing with
                the  statements  made  in Form 8-K by Softstone Inc., concerning
                Softstone's change of principal  independent  accountants.***

         31     Certification  of  Chief Executive Officer pursuant to 18 U.S.C.
                Section  1350,  as  adopted  pursuant  to  Section  302  of  the
                Sarbanes-Oxley Act of 2002.

         31.1   Certification  of   Chief  Financial  Officer  pursuant   to  18
                U.S.C. Section  1350,  as adopted pursuant to Section 302 of the
                Sarbanes-Oxley Act  of  2002.

         32     Certification  of  Chief Executive Officer pursuant to 18 U.S.C.
                Section  1350,  as  adopted  pursuant  to  Section  906  of  the
                Sarbanes-Oxley Act of 2002.

         32.1   Certification  of  Chief  Financial  Officer   pursuant   to  18
                U.S.C. Section  1350,  as adopted pursuant to Section 906 of the
                Sarbanes-Oxley Act  of  2002.

         99     United  States  Patent  No.  5,714,219.*


                                        1
<PAGE>

*     Previously  filed  with  Form  8-K  August  8,  2001  Commission  File No.
000-29523;  incorporated  by  reference.

**     Previously  filed  with  Form  10-QSB  May  20,  2002 Commission File No.
000-29523;  incorporated  by  reference.

***     Previously  filed  with  Form 8-K September 11, 2002 Commission File No.
000-29523;  incorporated  by  reference.
































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