SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q


[X] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange
    Act of 1934 for the quarterly period ended November 30, 2000 or

[ ] Transition report pursuant to section 13 of 15(d) of the Securities
    Exchange Act of 1934 for the transition period from                 to
                                                        ---------------
    ---------------


                         Commission file number: 0-25104
                                                 -------



                   CONTINENTAL INFORMATION SYSTEMS CORPORATION
                   -------------------------------------------
             (Exact name of registrant as specified in its charter)



          New York                                           16-0956508
          --------                                           ----------
(State or other jurisdiction                              (I.R.S. Employer
      of incorporation)                                  Identification No.)


45 Broadway Atrium, Suite 1105, New York, New York              10006
--------------------------------------------------              -----
     (Address of principal executive offices)                (Zip Code)


                                 (212) 771-1000
                                 --------------
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                               Yes  X      No
                                   ---        ---



                     APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: As of December 31, 2000, the
registrant has 5,920,186 shares of common stock, par value $.01 per share,
outstanding.

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CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
--------------------------------------------------------------------------------



                                TABLE OF CONTENTS


                                                                            Page

PART I -  FINANCIAL INFORMATION                                                3

Item 1.   Financial Statements
          --------------------

          Consolidated Balance Sheets - November 30, 2000
            and May 31, 2000                                                   3

          Consolidated Statements of Operations - Three and
            Six Months Ended November 30, 2000 and 1999                        4

          Consolidated Statements of Cash Flows - Six Months
            Ended November 30, 2000 and 1999                                 5-6

          Notes to Consolidated Financial Statements                         7-9

Item 2.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations                              10-12
          -------------------------------------------------


PART II - OTHER INFORMATION                                                   13

Item 1.   Legal Proceedings                                                   13
          -----------------

Item 6.   Exhibits and Reports on Form 8-K                                    13
          --------------------------------


SIGNATURES                                                                    14


                                      - 2 -
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<TABLE>
CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
-------------------------------------------------------------------------------------

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements
         --------------------


CONSOLIDATED BALANCE SHEETS
In Thousands (Except Number of Shares)
-------------------------------------------------------------------------------------


<CAPTION>
                                                         November 30,      May 31,
                                                             2000           2000
                                                         -------------  -------------
                                                          (Unaudited)     (Audited)
<S>                                                        <C>            <C>
ASSETS:
Cash and cash equivalents                                  $  2,108       $  3,382
Accounts receivable, net                                        337          1,095
Notes receivable                                              2,654          2,567
Investment in mortgage participation notes                      592          1,108
Restricted cash                                                 900            900
Net investment in direct financing leases                         6          1,092
Rental equipment, net                                           496             96
Property, plant and equipment, net                              210            260
Other assets                                                    119            229
Net assets of discontinued operations                         5,478          3,524
                                                         -------------  -------------

      Total assets                                         $ 12,900       $ 14,253
                                                         =============  =============


LIABILITIES AND SHAREHOLDERS' EQUITY:
Liabilities:
  Accounts payable and other liabilities                   $    338       $    509
  Discounted lease rental borrowings                              -            163
                                                         -------------  -------------

      Total liabilities                                         338            672
                                                         -------------  -------------
SHAREHOLDERS' EQUITY:
Common stock, $.01 par value; authorized 20,000,000
  shares, issued 7,101,668 shares                                71             71
Additional paid-in capital                                   35,129         35,129
Accumulated deficit                                         (21,117)       (20,753)
                                                         -------------  -------------
                                                             14,083         14,447
Treasury stock, at cost; 1,181,482 shares in 2001            (1,521)          (866)
                                                         -------------  -------------

      Total shareholders' equity                             12,562         13,581
                                                         -------------  -------------

      Total liabilities and shareholders' equity           $ 12,900       $ 14,253
                                                         =============  =============


-------------------------------------------------------------------------------------
</TABLE>

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


                                      - 3 -
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<TABLE>
CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
---------------------------------------------------------------------------------------------

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
In Thousands (Except Per Share Information)
---------------------------------------------------------------------------------------------


<CAPTION>
                                           Three Months Ended           Six Months Ended
                                              November 30,                November 30,
                                       --------------------------  --------------------------
                                           2000          1999          2000          1999
                                       ------------  ------------  ------------  ------------
<S>                                      <C>           <C>           <C>           <C>
REVENUES:
  Equipment sales                        $   492       $   133       $   550       $ 1,968
  Equipment rentals                           17           865            58         1,793
  Income from direct financing leases          8            75            29           188
  Interest income                            121           182           284           316
                                       ------------  ------------  ------------  ------------

                                             638         1,255           921         4,265
                                       ------------  ------------  ------------  ------------
COSTS AND EXPENSES:
  Cost of sales                              491            61           541         1,746
  Depreciation of rental equipment             5           785            14         1,617
  Interest expense                             1             4             5             8
  Other operating expenses                    44            48            97           110
  Selling, general and administrative
    expenses                               1,096           767         2,128         1,562
                                       ------------  ------------  ------------  ------------

                                           1,637         1,665         2,785         5,043
                                       ------------  ------------  ------------  ------------
        Loss from continuing
          operations                        (999)         (410)       (1,864)         (778)

        Gain (loss) from discontinued
          operations, net of tax benefit   1,500          (390)        1,500          (635)
                                       ------------  ------------  ------------  ------------

        Net income (loss)                $   501       $  (800)      $  (364)      $(1,413)
                                       ============  ============  ============  ============


Basic and diluted net loss
  per share (Note 2):
    Loss from continuing operations       $(.15)        $(.06)        $(.28)        $(.11)
    Gain (loss) from discontinued
      operations                            .23          (.06)          .23          (.10)
                                       ------------  ------------  ------------  ------------

        Net income (loss) per share       $ .08         $(.12)        $(.05)        $(.21)
                                       ============  ============  ============  ============

Weighted average number of shares
  of common stock outstanding             6,535         6,671         6,556         6,815
                                       ============  ============  ============  ============



---------------------------------------------------------------------------------------------
</TABLE>

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


                                      - 4 -

<PAGE>

<TABLE>
CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
---------------------------------------------------------------------------------------------

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
In Thousands
---------------------------------------------------------------------------------------------

<CAPTION>
                                                                    For the Six Months Ended
                                                                          November 30,
                                                                   --------------------------
                                                                       2000          1999
                                                                   ------------  ------------
<S>                                                                  <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss                                                           $  (364)      $(1,413)
  Less: Gain (loss) from discontinued operations                       1,500          (635)
                                                                   ------------  ------------

        Loss from continuing operations                               (1,864)         (778)
                                                                   ------------  ------------
  Adjustments to reconcile net loss from continuing operations
   to net cash used in operating activities:
    Gain from sale of equipment subject to lease                          (9)         (264)
    Depreciation and amortization expense                                 70         1,697
    Effect on cash flows of changes in:
      Accounts receivable, net                                           758          (202)
      Notes receivable                                                   (87)          335
      Other assets                                                       113          (219)
      Accounts payable and other liabilities                            (171)           (3)
      Deferred lease revenue                                               -        (1,563)
      Other                                                                -          (464)
                                                                   ------------  ------------
                                                                         674          (683)
                                                                   ------------  ------------

        Net cash used in continuing operations                        (1,190)       (1,461)
        Net cash used in discontinued operations                        (454)       (1,649)
                                                                   ------------  ------------

        Net cash used in operating activities                         (1,644)       (3,110)
                                                                   ------------  ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from sale of equipment                                        554         1,969
  Purchase of rental equipment                                             -            (7)
  Purchase of property and equipment                                       -           (11)
  Collections of rentals on direct financing leases
    net of amortization of unearned income                               117           290
  Proceeds from (disbursement for) investment in
    mortgage participation notes                                         516          (286)
                                                                   ------------  ------------

        Net cash provided by investing activities                      1,187         1,955
                                                                   ------------  ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from lease, bank and institution financings                     -             9
  Payments on lease, bank and institution financings                    (163)            -
  Purchase of treasury stock                                            (654)            -
                                                                   ------------  ------------

        Net cash provided by (used in) financing activities             (817)            9
                                                                   ------------  ------------
        Net decrease in cash and cash equivalents                     (1,274)       (1,146)

CASH AND CASH EQUIVALENTS:
  Beginning of period                                                  3,382         5,616
                                                                   ------------  ------------

  End of period                                                      $ 2,108       $ 4,470
                                                                   ============  ============

---------------------------------------------------------------------------------------------
</TABLE>

(Continued)


                                      - 5 -
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<TABLE>
CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
---------------------------------------------------------------------------------------------

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Continued)
In Thousands
---------------------------------------------------------------------------------------------



<CAPTION>
                                                                    For the Six Months Ended
                                                                          November 30,
                                                                   --------------------------
                                                                       2000          1999
                                                                   ------------  ------------
<S>                                                                  <C>           <C>
SUPPLEMENTAL CASH FLOW DISCLOSURES:
  Cash paid for income taxes                                         $    50       $     5
                                                                   ============  ============

  Cash paid for interest                                             $     5       $     7
                                                                   ============  ============


SUPPLEMENTAL SCHEDULE OF NONCASH ACTIVITIES:
  Inventory arising from transfers of equipment
    that came off-lease                                              $   685       $     -
                                                                   ============  ============




---------------------------------------------------------------------------------------------
</TABLE>

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


                                      - 6 -
<PAGE>

CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
--------------------------------------------------------------------------------


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.  Basis of Presentation
    ---------------------

The accompanying unaudited consolidated financial statements of Continental
Information Systems Corporation have been prepared in accordance with generally
accepted accounting principles for interim financial information and in
accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting only of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the six months ended November 30, 2000 are not
necessarily indicative of the results that may be expected for the year ended
May 31, 2001. These statements should be read in conjunction with the
consolidated financial statements and footnotes thereto included in the
Company's annual report on Form 10-K for the year ended May 31, 2000.

2.  Net Income Per Share
    --------------------

EARNINGS PER SHARE, are calculated in accordance with Financial Accounting
Standard No. 128 (SFAS 128), EARNINGS PER SHARE, which specifies standards for
computing and disclosing net income (loss) per share. Basic and diluted net
income (loss) per share for the six months ended November 30, 2000 and 1999, was
computed based on the weighted average number of shares of common stock
outstanding during the periods. As of November 30, 2000, the Company had issued
and outstanding options to purchase 222,616 shares of common stock (see Note 5).
The effect of these options is anti-dilutive in the computation of diluted net
income (loss) per share.

3.  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 revenue and expenses during the reporting periods.
Actual results could differ from those estimates.

4.  Reclassifications
    -----------------

Certain prior period balances in the financial statements have been reclassified
to conform to the current period financial statement presentation.

5.  Stock Option Plan
    -----------------

In 1995, the Board of Directors adopted and the stockholders approved the
Continental Information Systems Corporation 1995 Stock Compensation Plan (the
"1995 Plan"). The 1995 Plan provides for the issuance of options covering up to
1,000,000 shares of common stock and stock grants of up to 500,000 shares of
common stock to non-employee directors of the Company and, at the discretion of
the Board of Directors, employees of and independent contractors and consultants
to the Company.

A summary of the status of the 1995 Plan as of November 30, 2000 and changes
during the years ended on those dates is presented below:


                                      - 7 -
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CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
--------------------------------------------------------------------------------


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)


<TABLE>
<CAPTION>
                                                               Weighted
                                                                Average
                                                                Exercise
                                                   Number of   Price Per
                                                    Options      Option
                                                  -----------  ----------
<S>                                                 <C>          <C>
        Outstanding at
          May 31, 1997 (188,337 exercisable)        284,000      $ 2.02
        Granted                                     190,674      $ 2.38
        Exercised                                   (70,001)     $ 1.97
        Forfeited/expired                           (38,331)     $ 1.97
                                                  -----------
        Outstanding at
          May 31, 1998 (234,002 exercisable)        366,342      $ 2.22
        Granted                                      72,000      $ 1.92
        Exercised                                         -      $  -
        Forfeited/expired                           (16,668)     $ 1.97
                                                  -----------
        Outstanding at
          May 31, 1999 (298,008 exercisable)        421,674      $ 2.18
        Granted                                      13,280      $ 1.40
        Exercised                                         -      $  -
        Forfeited/expired                          (119,671)     $ 2.10
                                                  -----------
        Outstanding at
          May 31, 2000 (302,003 exercisable)        315,283      $ 2.18
        Granted                                           -      $  -
        Exercised                                         -      $  -
        Forfeited/expired                          (101,667)     $ 2.17
                                                  -----------
        Outstanding at
          August 31, 2000 (200,336 exercisable)     213,616      $ 2.18
        Granted                                      15,000      $ 1.06
        Exercised                                         -      $  -
        Forfeited/expired                            (6,000)     $ 2.50
                                                  -----------
        Outstanding at
          November 30, 2000 (207,616 exercisable)   222,616      $ 2.09
                                                  ===========
</TABLE>

6.  Discontinued Operations
    -----------------------

On July 14, 2000, the Company announced that it was offering for sale its
commercial aircraft engine portfolio by competitive bid, that upon completion of
the sale it will be exiting the aviation business, and that it would account for
and report the Air Group Business as a discontinued operation.

CIS Air has a revolving loan agreement (the "CIS Air Loan facility") with an
institution to provide lease and inventory financing for aircraft engines, in
the amount of $10,000,000. The facility has a three-year term and permits
borrowings equal to a percentage of the appraised value of the aircraft engines
financed. Substantially all of the assets of CIS Air are pledged as collateral
for the Loan. At November 30, 2000, $1,347,964 of this facility was being
utilized. The CIS Air Loan facility bears interest at prime plus 1/4% (9.75% at
November 30, 2000) and was originally scheduled to expire in December 2000.
Interest related to this facility was $42,405 and $140,367 for the quarters
ended November 30, 2000 and 1999, respectively. The Company's lender was
notified of the Company's decision to exit the aviation business and the lender
terminated the Company's ability to make additional borrowings under the CIS Air
Loan facility. However, the Company and its lender did amend the original loan
agreement to apply lease and sales proceeds as permanent paydowns to the
outstanding loan balance. In December, the loan agreement was further amended to
allow the Company to extend the original expiration date of the loan facility
for unpaid borrowings up to April 30, 2001. As of December 31, 2000, $1,317,643
of the facility was unpaid.


                                      - 8 -

<PAGE>
CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
--------------------------------------------------------------------------------


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)


At the time of the Company's exit from the aviation business, management made
certain estimates and reserves as to the carrying value of certain assets held
by the operations. In the opinion of management, there has been further price
erosion in the aviation industry relating to assets carried by the Company and
management has recorded an additional provision for asset carrying value in the
amount of $800,000 for the current quarter. As a result of the Eastwind
settlement (see "Legal Proceedings") a gain of $2.3 million was recorded by the
Company. This gain is attributable to activities by the Company in connection
with its leasing of engines and aircraft and is accordingly shown in the
discontinued operations section of the Company's financial statements. No prior
provision was made for this settlement, as the Company was unable to determine
with any degree of certainty the success of the litigation.

The Consolidated Balance Sheets and Statements of Operations for all periods
presented have been reclassified to report the results of discontinued
operations separately from those of continuing operations.

<TABLE>
<CAPTION>
                                                        Six Months Ended
                                                          November 30,
                                                     ----------------------
                                                        2000        1999
                                                     ----------  ----------
<S>                                                   <C>         <C>
    Revenues                                          $ 2,300     $ 2,267
    Costs and expenses                                    800       2,902
                                                     ----------  ----------

    Gain (loss) from discontinued operations            1,500        (635)
    Income tax benefit                                      -           -
                                                     ----------  ----------

    Net income (loss) from discontinued operations    $ 1,500     $  (635)
                                                     ==========  ==========
</TABLE>

A summary of the assets and liabilities of discontinued operations follows (in
thousands):

<TABLE>
<CAPTION>
                                                    November 30,   May 31,
                                                        2000        2000
                                                    -----------  ----------
<S>                                                   <C>          <C>
    Assets:
      Cash and cash equivalents                       $   201      $  336
      Receivable, net                                   3,880         991
      Inventory                                         4,340       5,254
      Net investment in direct financing leases           720         907
      Rental equipment                                      -       5,663
      Other assets                                          5           4
                                                     ----------  ----------

        Total assets                                    9,146      13,155
                                                     ----------  ----------
    Liabilities:
      Accounts payable and cost of discontinuance       2,320       2,229
      Other liabilities                                     -         483
      Note payable to institution                       1,348       6,919
                                                     ----------  ----------

        Total liabilities                               3,668       9,631
                                                     ----------  ----------

        Net assets of discontinued operations         $ 5,478     $ 3,524
                                                     ==========  ==========
</TABLE>


                                      - 9 -
<PAGE>

CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
--------------------------------------------------------------------------------


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


                                  Introduction
                                  ------------

The following discussion and analysis of the financial condition and results of
operations of the Company should be read in conjunction with the consolidated
financial statements and the notes thereto for the fiscal year ended May 31,
2000, appearing in the Company's annual report on Form 10-K.

All statements contained herein that are not historical facts, including but not
limited to statements regarding anticipated future capital requirements and the
Company's future business plans, are based on current expectations. These
statements are forward looking in nature and involve a number of risks and
uncertainties. Actual results may differ materially. Among the factors that
could cause actual results to differ materially are those set forth below and
the other risk factors described from time to time in the Company's reports
filed with the SEC. The Company wishes to caution readers not to place undue
reliance on any such forward looking statements, which statements are made
pursuant to the Private Securities Litigation Reform Act of 1995 and, as such,
speak only as of the date made.


                              Results of Operations
                              ---------------------

Comparison of the Three and Six Months Ended November 30, 2000 and 1999
-----------------------------------------------------------------------

Continuing Operations
---------------------

Revenues
--------
Total revenues decreased to $638,000 for the three months ended November 30,
2000 from $1.3 million for the comparable fiscal quarter in 1999. This decrease
was primarily due to the lower rental income from direct finance leases.
Equipment sales increased to $492,000 for the three months ended November 30,
2000 from $133,000 for the comparable fiscal quarter in 1999. The increase is
due to the sale of the remaining general-purpose equipment portfolio. For the
six months ended November 30, 2000, total revenues decreased to $921,000 from
$4.3 million for the comparable fiscal period in 1999. For the six months ended
November 30, 2000, equipment sales decreased 72% to $550,000 compared to $2.0
million for the comparable prior year period. For the six and three month
periods ended November 30, 2000, equipment rentals decreased to $58,000 and
$17,000 from $1.8 million and $865,000 for the comparable periods in 1999.

The reduction in revenue for these periods is because the Company has sold off
substantially all of its leasing portfolio and discontinued its aviation
business. The Company's only active operating activity is that of its
T1Xpert.com subsidiary which is developing software for the securities industry.
This subsidiary is not expected to produce revenue in 2001. Accordingly, the
Company has no ongoing operating source to generate recurring revenue and
expects the historical decline in period revenue to continue.

Interest income for the three and six months ended November 30, 2000, were
$121,000 and $284,000, respectively, compared to $182,000 and $316,000 for the
corresponding prior year periods. This decrease was due to lower cash balances
because of funding T1Xpert.com operations.

Costs and Expenses
------------------
Costs and expenses for the three and six months ended November 30, 2000,
decreased by $28,000 (2%) and $2,258,000 (45%), respectively, from the
comparable periods in 1999.

Depreciation of rental equipment for the three and six months ended November 30,
2000, decreased to approximately $5,000 and $14,000 from $785,000 and
$1,617,000, respectively, for the comparable periods for 1999. This decrease is
due to a decrease in the inventory of rental equipment as a result of the sale
of the leasing portfolio in August 1999 and November 2000.


                                     - 10 -
<PAGE>


CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
--------------------------------------------------------------------------------


Interest expense for the three and six months ended November 30, 2000, was
$1,000 and $5,000, respectively, as compared to $4,000 and $8,000 for the
comparable periods in 1999.

Selling, general and administrative expenses for the three months ended November
30, 2000, were $1.1 million as compared to $767,000 for the comparable period in
1999. This increase is attributable to the Company's start up subsidiary
T1Xpert.com, whose expenses, including payroll and consulting expenses, amounted
to $605,000. This increase was offset by a decrease in general and
administrative expenses in the amount of $280,000. For the six months ended
November 30, 2000, selling, general and administrative expenses were $2.1
million compared to $1.6 million for the comparable period in 1999. This
increase is attributable to the Company's start up subsidiary T1Xpert.com.
T1Xpert.com's selling, general and administrative expenses for the current
period amounted to $1.2 million compared to $115,000 for the comparable fiscal
period in 1999, the period T1Xpert.com commenced operations. This increase was
offset by a decrease in general and administrative expenses in the amount of
$532,000. These decreases in general and administrative expenses were
principally due to cost containment efforts and staff reduction between the
periods.

As T1Xpert.com further develops its product, the Company expects that costs will
increase as the need arises to assemble a marketing and business development
program. Additional costs are expected to be incurred as the Company implements
its products on an alpha level. Further unanticipated costs may also arise.
General and administrative costs relating to the Company's prior operations are
expected to decrease, but will be subject to a certain fixed cost of operating
the Company at certain necessary minimum levels. Further, some Company personnel
may serve in functions necessary to T1Xpert.com.

Income Taxes
------------
For the quarter ended November 30, 2000, provision for deferred income tax
benefit on income from continuing operations was not recorded, because, in
management's opinion, the realizability of the deferred tax asset was uncertain
in light of the Company's actual operating results since reorganization.


                         Liquidity and Capital Resources
                         -------------------------------

Net cash used in operations for the six months ended November 30, 2000 was $1.6
million as compared to $3.1 million for the comparable period in 1999 and net
cash used by continuing operations for the six months ended November 30, 2000
was $1.2 million as compared to net cash used in continuing operations in the
amount of $1.5 million for the comparable period in 1999. Net cash used in
discontinued operations for the six months ended November 30, 2000 and 1999 was
$454,000 and $1.6 million, respectively.

Net cash provided by investing activities for the six months ended November 30,
2000 was $1.2 million compared to $2.0 million for the six months ended November
30, 1999. The Company received $516,000 proceeds from its investment in mortgage
participation notes during the six months ended November 30, 2000 as compared to
investment of $286,000 in mortgage participation notes for the comparable period
in 1999.

As of November 30, 2000, the Company had $2.1 million in cash and cash
equivalents, as compared to $4.5 million at November 30, 1999 and $3.4 million
at May 31, 2000. In August 1999 proceeds of $1.9 million were received by CIS in
connection with the sale of leased equipment. The Company has established the
CIS Air Loan Facility with a financing institution to provide lease and
inventory financing for aircraft engines for its operating subsidiary CIS Air,
in the amount of $10,000,000. The facility had a three-year term that expired in
December 2000 and permitted borrowing equal to a percentage of the appraised
value of the aircraft engines financed. The facility is not being renewed, but
has been extended beyond the original expiration date of the loan until April
30, 2001. The extension allows for the continued borrowing of unpaid amounts
existing at the original expiration date of the facility. It further provides
for proceeds of engine sales and rental to be applied in permanent pay down of
such loan. Should the Company be unable to sell sufficient assets to pay down
the facility by April 30, 2001 the Company will need to negotiate an extension
of such loan. Such terms and conditions may be materially unfavorable to the
Company. Substantially all of the assets of CIS Air are pledged as collateral
for the loan. At November 30, 2000, $1,347,964 of this facility was being
utilized. The CIS Air Loan Facility bears interest at prime plus 1/4% and
expires in December 2000.


                                     - 11 -
<PAGE>

CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
--------------------------------------------------------------------------------


T1Xpert.com had expended $2,820,000 from its inception in August 1999 through
November 30, 2000. The Company believes it has sufficient cash on hand to meet
current operating needs until the projected development of its initial products
through alpha stage, which it currently projects to be at the end of 2001. The
successful and timely completion of the alpha stage is dependent, among other
items, upon the Company obtaining a core client and the successful execution of
the Company's operating plan, neither of which can be assured. After the alpha
stage the Company will be in a position to begin beta-pre-production rollout of
its product, which it is targeting for mid 2002. At that point, the Company
would then expect to be in a position to deliver revenue-producing products.

The Company anticipates that, in developing past the alpha stage, it will need
substantial additional funds. In connection therewith, the Company anticipates
that in 2001 it will be seeking investments from strategic client/investors
and/or venture capital investors. The form of investment will depend upon terms
and conditions to be negotiated. In return for such funds the Company
anticipates offering equity in T1Xpert.com. The amount of such equity and other
terms and conditions will be subject to market conditions prevailing. The effect
of such outside investment on the current shareholders of the Company cannot be
determined, but may be dilutive to them. The Company may co-invest with such
investors or, failing to find such investors, the Company may decide to fund
such expenditures from its own resources. This funding may result in the Company
selling assets at below market prices in order to raise funds. There can be no
assurance that the Company will be able to meet its financial needs after it
passes the alpha stage of development.


                                     - 12 -
<PAGE>

CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
--------------------------------------------------------------------------------


PART II - OTHER INFORMATION


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

On September 21, 2000 the Company reported that on September 19, 2000, the
Company and the other petitioning creditors reached a settlement agreement with
Eastwind Airlines and UM Holding, Inc. This agreement was approved by the
Bankruptcy Court on October 20, 2000. The material provisions of the final
agreement resulted in the Company and the other petitioning creditors combined
receiving consideration worth $4 million in a package that includes $3 million
in cash and a $1 million, 1-year unsecured note (6% interest rate and matures in
March 2002 requiring monthly payments of principal and interest), and the
dismissal of CIS Air's lawsuit in North Carolina State Court against AeroTurbine
and AeroTurbine's dismissal of its counterclaims. After payment of professional
fees incurred in reaching this settlement as well as payments to co-petitioning
creditors the Company netted a gain in the amount of approximately $2.3 million.
This gain presumes collectibility on the note, which management believes to be
likely. As the origin of the gain relates to the Company's now discontinued
operations, the gain is recorded in that section.

The Company incorporates by reference prior legal matters reported in the
Company's Form 10K for the fiscal year ended May 31, 2000 and Form 10Q for the
fiscal year ended August 31, 2000.


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

         (a)  Exhibit 27.1 - Financial Data Schedule.
              ------------

         (b)  Reports on Form 8-K - The Company filed the following reports on
              -------------------
              Form 8-K on the dates indicated during the quarter ended November
              30, 2000.

              Date                 Description
              ----                 -----------

              September 21, 2000   The Company announced it had reached a
                                   settlement with Eastwind Airlines and
                                   UM Holdings.

              November 28, 2000    The Company announced the repurchase of
                                   607,158 shares from the Chase Manhattan Bank.


                                     - 13 -
<PAGE>

CONTINENTAL INFORMATION SYSTEMS CORPORATION
AND ITS SUBSIDIARIES
--------------------------------------------------------------------------------


                                   SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                          CONTINENTAL INFORMATION SYSTEMS CORPORATION


Date:  January 16, 2001   By:    /s/ Michael L. Rosen
                                 -----------------------------------------------
                          Name:  Michael L. Rosen
                          Title: President, Chief Executive Officer and Director


Date:  January 16, 2001   By:    /s/ Jonah M. Meer
                                 -----------------------------------------------
                          Name:  Jonah M. Meer
                          Title: Senior Vice President, Chief Operating Officer
                                 and Chief Financial Officer


                                     - 14 -