UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   Form 10-QSB

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

             For the quarterly period ended:         June 30, 2001
                                            ------------------------------------

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

             For the transition period from                to
                                            ---------------   ------------------
                    Commission file number             33-4707-NY
                                            ------------------------------------

                                    CBQ, Inc.
   --------------------------------------------------------------------------
                     (Exact name of small business issuer as
                            specified in its charter)

           Colorado                                        84-1047159
--------------------------------------------------------------------------------
  (State or other jurisdiction                           (IRS Employer
of incorporation or organization)                        Identification No.)

                10923 McCormick Road, Hunt Valley, Maryland 21031
  ----------------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (410) 568-4000
                   -------------------------------------------
                            Issuer's telephone number


      (Former name, former address and former fiscal year, if changed since
last report.)


                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                   PROCEEDING DURING THE PRECEDING FIVE YEARS

         Check whether the registrant  filed all documents and reports  required
to be  filed  by  Section  12,  13 or  15(d)  of  the  Exchange  Act  after  the
distribution of securities under a plan confirmed by a court. Yes ----- No -----


<PAGE>


                      APPLICABLE ONLY TO CORPORATE ISSUERS

         State the number of shares  outstanding of each of the issuer's classes
of common equity,  as of the latest practical date: July 11, 2001  Approximately
79,621,299 shares

         Transitional Small Business Disclosure Format (check one).
Yes      ;  No   X
    ----       -----























<PAGE>

                                     PART I


Item 1.  Financial Statements


                         INDEPENDENT ACCOUNTANT'S REPORT

To the Board of Directors and Shareholders
CBQ, Inc. and Subsidiaries



         We have reviewed the accompanying  consolidated  balance sheets of CBQ,
Inc. and  Subsidiaries as of June 30, 2001 and December 31, 2000 and the related
consolidated  statements  of  operations  for the three and six  months and cash
flows for the six month periods ended June 30, 2001 and 2000. These consolidated
financial statements are the responsibility of the Company's management.

         We conducted our review in accordance with standards established by the
American  Institute  of  Certified  Public  Accountants.  A  review  of  interim
financial  information consists principally of applying analytical procedures to
financial  data and making  inquiries of persons  responsible  for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statement taken as a whole.
Accordingly, we do not express such an opinion.

         Based on our  review,  we are not aware of any  material  modifications
that should be made to the accompanying  consolidated  financial  statements for
them to be in conformity with generally accepted accounting principles.

                                                   Respectfully submitted



                                                   /s/ Robison, Hill & Co.
                                                   ----------------------------
                                                   Certified Public Accountants

Salt Lake City, Utah
August 16, 2001


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>

                                                                                (Unaudited)
                                                                                  June 30,          December 31,
                                                                                    2001                2000
                                                                             ------------------  ------------------
Assets:

Current assets:
<S>                                                                          <C>                 <C>
   Cash                                                                      $          197,989  $          147,873
   Accounts receivable, net of allowance for doubtful accounts                          957,588           1,042,248
   Inventories                                                                          140,280              75,420
   Other current assets                                                                 867,195             186,277
                                                                             ------------------  ------------------

      Total current assets                                                            2,163,051           1,451,818
                                                                             ------------------  ------------------

Equipment:
   Computers and related equipment                                                      592,201             537,890
   Office equipment                                                                     371,812             355,664
   Software                                                                              34,927              34,927
   Transportation equipment                                                              48,558              47,078
   Leasehold improvements                                                                17,910              18,611
                                                                             ------------------  ------------------
                                                                                      1,065,408             994,170
      Less accumulated depreciation                                                    (627,534)           (548,427)
                                                                             ------------------  ------------------

         Equipment, net of accumulated depreciation                                     437,874             445,743
                                                                             ------------------  ------------------

Other non-current assets:
   Notes receivable, long-term                                                           60,452              60,452
   Goodwill, less amortization                                                        1,377,467             844,951
   Investments                                                                           46,163              46,163
   Other assets                                                                          72,562              75,999
                                                                             ------------------  ------------------

      Total other non-current assets                                                  1,556,644           1,027,565
                                                                             ------------------  ------------------

         Total assets                                                        $        4,157,569  $        2,925,126
                                                                             ==================  ==================
</TABLE>






<PAGE>


                           CBQ, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                   (Continued)
<TABLE>
<CAPTION>

                                                                                (Unaudited)
                                                                                  June 30,          December 31,
                                                                                    2001                2000
                                                                             ------------------  ------------------

Liabilities and Stockholders' Deficit:

Current liabilities:
<S>                                                                          <C>                 <C>
   Line of credit payable                                                    $          912,157  $        1,312,157
   Current portion of long-term debt                                                    764,029              87,908
   Accounts payable, trade                                                            2,076,455           1,780,927
   Accrued expenses                                                                     626,020             348,591
   Due to related party                                                                   1,215               1,215
   Due to shareholders                                                                  115,000             115,000
                                                                             ------------------  ------------------

      Total current liabilities                                                       4,494,875           3,645,798
                                                                             ------------------  ------------------

Non-current liabilities:
   Long-term debt                                                                     1,803,673           1,813,139
   Preferred stock of subsidiaries                                                      525,000             525,000
                                                                             ------------------  ------------------

      Total non-current liabilities                                                   2,328,673           2,338,139
                                                                             ------------------  ------------------

         Total Liabilities                                                            6,823,548           5,983,938
                                                                             ------------------  ------------------

Stockholders' Deficit:
   Preferred Stock, par value $.001 per share
      Authorized  100,000,000  shares,
      70,000 shares issued and outstanding at
      June 30, 2001 and December 31, 2000                                                    70                  70

   Common Stock, par value $.0001 per share
      Authorized  500,000,000  shares,
      Issued 79,516,835 Shares at June 30, 2001
      and 69,836,835 shares at December 31, 2000                                          7,952               6,984
   Additional paid-in capital                                                         3,518,141           2,304,813
   Accumulated deficit                                                               (6,192,143)         (5,370,678)
                                                                             ------------------  ------------------

     Total Stockholders' Deficit                                                     (2,665,979)         (3,058,811)
                                                                             ------------------  ------------------

     Total Liabilities and
       Stockholders' Deficit                                                 $        4,157,569  $        2,925,126
                                                                             ==================  ==================
</TABLE>

                 See accompanying notes and accountants' report.


<PAGE>


                           CBQ, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>

                                               For the Three Months                    For the Six Months
                                                  Ended June 30,                         Ended June 30,
                                        -----------------------------------  --------------------------------------
                                               2001              2000               2001                2000
                                        ------------------ ----------------  ------------------  ------------------
Continuing operations:
<S>                                     <C>                <C>               <C>                 <C>
Revenues                                $        2,240,368 $      2,097,997  $        3,712,859  $        5,090,196
Cost of revenues                                 1,803,639        1,765,702           2,542,788           3,771,778
                                        ------------------ ----------------  ------------------  ------------------
     Gross Profit                                  436,729          332,295           1,170,071           1,318,418
                                        ------------------ ----------------  ------------------  ------------------

Expenses
  Sales and marketing                              296,011          146,682             467,676             169,084
  General and administrative                       676,370        1,039,113           1,140,821           1,255,008
  Depreciation and amortization                    117,459          147,036             211,891             149,442
                                        ------------------ ----------------  ------------------  ------------------

     Total costs and expenses                    1,089,830        1,332,831           1,820,388           1,573,534
                                        ------------------ ----------------  ------------------  ------------------

Other Income (Expense)
  Interest expense                                (100,524)        (138,031)           (189,437)           (144,833)
  Other income                                      11,280                -              11,280                   -
                                        ------------------ ----------------  ------------------  ------------------

     Net Other Income (Expense)                    (89,244)        (138,031)           (178,157)           (144,833)
                                        ------------------ ----------------  ------------------  ------------------

     Net Loss from Continuing
        Operations                                (742,356)      (1,138,567)           (828,474)           (399,949)
                                        ------------------ ----------------  ------------------  ------------------

Discontinued operations:
Income (Loss) from operations of
   discontinued operations                               1         (389,342)              7,009            (714,972)

Loss on disposal of
   discontinued operations                               -                -                   -                   -
                                        ------------------ ----------------  ------------------  ------------------

     Net Income (loss) from
       discontinued operations                           1         (389,342)              7,009            (714,972)
                                        ------------------ ----------------  ------------------  ------------------

Net Income (Loss)                       $         (742,357)$     (1,527,909) $         (821,465) $       (1,114,921)
                                        ================== ================  ==================  ==================

Weighted Average
Shares Outstanding                              78,726,725       64,833,866          75,525,122          66,404,025
                                        ================== ================  ==================  ==================

Loss per Common Share                   $           (0.01) $         (0.03)  $           (0.01)  $           (0.02)
                                        ================== ================  ==================  ==================
</TABLE>

                 See accompanying notes and accountants' report.


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>


                                                                       (Unaudited)
                                                                For the six months ended
                                                                        June 30,
                                                          -------------------------------------
                                                                2001                2000
                                                          -----------------  ------------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Continuing operations:
<S>                                                       <C>                <C>
   Net Income (Loss)                                      $        (839,752) $         (399,949)
Adjustments necessary to reconcile net loss
   to net cash used in operating activities:
      Depreciation and amortization                                 211,891             149,442
      Decrease (increase) in accounts receivable                  1,712,578             592,786
      Decrease (increase) in inventories                            (64,860)            193,797
      Decrease (increase) in other current assets                  (631,510)           (246,765)
      Decrease (increase) in other assets                            12,620             (90,182)
      Increase (decrease) in accounts payable                      (401,805)            209,378
      Increase (decrease) in accrued expenses                       277,429             119,981
                                                          -----------------  ------------------
  Net Cash Used in continuing operations                             79,516             528,488
                                                          -----------------  ------------------

Cash flows from discontinued operations                             215,362            (714,972)
                                                          -----------------  ------------------

CASH FLOWS FROM INVESTING
ACTIVITIES:
Acquisition of equipment                                            (47,717)                  -
                                                          -----------------  ------------------
Net cash provided by (used) investing activities                    (47,717)                  -
                                                          -----------------  ------------------

CASH FLOWS FROM FINANCING
ACTIVITIES:
(Repayments) borrowings on line of credit                          (400,000)            585,568
Other decreases in long-term debt                                   (12,045)                  -
Repayment of notes payable to shareholder                                 -             (25,562)
Common stock issued for cash                                        215,000                   -
                                                          -----------------  ------------------
Net Cash Provided by
  Financing Activities                                             (197,045)            560,006
                                                          -----------------  ------------------

Net (Decrease) Increase in
  Cash and Cash Equivalents                                          50,116             373,522
Cash and Cash Equivalents
  at Beginning of Period                                            147,873            (119,165)
                                                          -----------------  ------------------
Cash and Cash Equivalents
  at End of Period                                        $         197,989  $          254,357
                                                          =================  ==================

</TABLE>
<PAGE>
                           CBQ, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                    Continued


<TABLE>
<CAPTION>

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
<S>                                                       <C>                <C>
  Interest                                                $          63,675  $           79,201
  Franchise and income taxes                              $            --    $             --
</TABLE>

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES:

         On March 1, 2001, the Company purchased Easy Soft  International,  Inc.
("Easy  Soft").  The  purchase  price was  5,625,000  shares of common  stock in
exchange for assets valued at $580,596 (receivables in the approximate amount of
$95,665,  equipment  and other assets of $5,181 and  goodwill of $479,750)  less
liabilities of $9,305.

         On March 27,  200l the  Company  purchased  certain  assets of  Technet
Computers  Services,  Inc. and Networkland,  Inc. for 7,800,000 shares of common
stock and a 10% note  payable of  $700,000  in  exchange  for which the  Company
received  assets  valued  at  $1,794,748  (  receivables  $1,553,273,  inventory
$27,067,  equipment  $20,417,  goodwill  $192,671 and other  assets  $1,320) and
assumed liabilities of $688,029.

The allocation of purchase price include  certain  assumptions  and  preliminary
estimates and are subject to change.

         In April 2001, the Company settled  approximately  $120,000 in disputed
charges  with a third  party  for  $17,000  in cash and  900,000  shares  of the
Company's common stock.






                 See accompanying notes and accountants' report.



<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000
            ---------------------------------------------------------

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         This summary of accounting  policies for CBQ, Inc. and  Subsidiaries is
presented  to assist  in  understanding  the  Company's  consolidated  financial
statements.  The accounting  policies conform to generally  accepted  accounting
principles  and  have  been  consistently  applied  in  the  preparation  of the
financial statements.

Interim Reporting

         The  unaudited  financial  statements  as of June 30,  2001 and for the
three month and six month periods  ended June 30, 2001 and 2000 reflect,  in the
opinion of management,  all  adjustments  (which  include only normal  recurring
adjustments)  necessary  to fairly state the  financial  position and results of
operations for the three and six months.  Operating  results for interim periods
are not  necessarily  indicative  of the results  which can be expected for full
years.

Organization and Basis of Presentation

         CBQ, Inc., (formerly Freedom Funding, Inc.) a Colorado corporation, was
incorporated  September 18, 1986,  under the laws of the State of Delaware,  and
changed its situs to Colorado in 1989.

         The Company ceased its  development  stage with its merger with Quantum
Technology Group, Inc. ("Quantum Group") in August 2000.

Nature of Business

         The  Company's  lines  of  businesses   include  software   development
outsourcing,  web  development,  custom  software  development,  network systems
integration and management.

Principles of Consolidation

         The consolidated  financial  statements for the three months ended June
30,  2001 and 2000  include  the  accounts  of the parent  entity and all of its
subsidiaries: Quantum Group and its subsidiary, ProWare, Inc. ("ProWare"); China
Partners, Inc. (from the date of its formation in March 2000); CyberQuest,  Inc.
("CyberQuest");  Reliance  Technologies,  Inc.  ("Reliance") and its subsidiary,
TopherNet, Inc. ("TopherNet");  and Priority One Electronic Commerce Corporation
("Priority  One").  Two  subsidiaries  of  Quantum  Group,   Quantum  Technology
Distribution, Inc. ("Quantum Distribution") and dpi Net Solutions, Inc. ("DPI"),
are included in the consolidated financial statements from November 15, 1999 and
April 1, 2000, their respective dates of acquisition by Quantum Group.




<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000
            ---------------------------------------------------------
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

         As more fully  described in Note 2, the business  combinations  between
the Company and ChinaSoft,  Inc.  ("ChinaSoft")  in January 2000 and between the
Company  and  Quantum  Group in August  2000 were  accounted  for as poolings of
interests.  Accordingly,  the Company's  consolidated  financial statements have
been restated for all periods to reflect the  consolidated  financial  position,
results of  operations  and cash flows of the  Company,  ChinaSoft  and  Quantum
Group.

All significant intercompany balances and transactions have been eliminated.

Cash and Cash Equivalents

         For purposes of the statement of cash flows, the Company  considers all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.

Pervasiveness of Estimates

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  required  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.

Revenue Recognition

Revenue is recognized as services are performed or as products are shipped.

Inventories

Inventories  are stated at lower of cost or market,  with cost determined on the
first-in, first-out method.

Income Taxes

         The  Company  has a net  operating  loss for income  taxes.  Due to the
regulatory  limitations  in  utilizing  the loss,  it is  uncertain  whether the
Company  will be able to  realize a benefit  from  these  losses.  Therefore,  a
deferred  tax  asset  has  not  been  recorded.  There  are no  significant  tax
differences requiring deferral.


<PAGE>


                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000
            ---------------------------------------------------------
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Loss per Share

         The  reconciliations  of the numerators and  denominators  of the basic
loss per share computations are as follows:

<TABLE>
<CAPTION>

                                                              Income              Shares             Per-Share
                                                           (Numerator)         (Denominator)           Amount
                                                        ------------------  -------------------  ------------------
                                                                 For the Three Months Ended June 30, 2001
                                                        -----------------------------------------------------------
Basic Income per Share
<S>                                                     <C>                 <C>                  <C>
Income to common shareholders                           $         (742,357)          78,726,725  $           (0.01)
                                                        ==================  ===================  ==================

                                                                 For the Three Months Ended June 30, 2000
                                                        -----------------------------------------------------------
Basic Loss per Share
Loss to common shareholders                             $       (1,527,909)          64,833,866  $           (0.03)
                                                        ==================  ===================  ==================

                                                                  For the Six Months Ended June 30, 2001
                                                        -----------------------------------------------------------
Basic Income per Share
Income to common shareholders                           $         (821,465)          75,525,122  $           (0.01)
                                                        ==================  ===================  ==================

                                                                  For the Six Months Ended June 30, 2000
                                                        -----------------------------------------------------------
Basic Loss per Share
Loss to common shareholders                             $       (1,114,921)          66,404,025  $           (0.02)
                                                        ==================  ===================  ==================
</TABLE>

         The  effect  of   outstanding   common  stock   equivalents   would  be
anti-dilutive for June 30, 2001 and 2000 and are thus not considered.

Concentration of Credit Risk

         The  Company has no  significant  off-balance-sheet  concentrations  of
credit  risk such as foreign  exchange  contracts,  options  contracts  or other
foreign hedging arrangements.

Goodwill

         Goodwill  reflects  the excess of purchase  prices over the fair market
value  of  assets  acquired  in  the  CyberQuest  reverse  acquisition  and  DPI
acquisition. Goodwill is amortized over a five-year period.


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000
            ---------------------------------------------------------
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Property and Equipment

Property  and  equipment  is  recorded  at cost,  except for assets  acquired in
acquisitions  accounted  for as purchases.  Property and  equipment  acquired in
acquisitions accounted for as purchases are recorded at their fair market values
at the date of  acquisition.  All property and  equipment are  depreciated  on a
straight-line basis with the following useful lives:
        Computers and related equipment             3 years
        Office equipment                            7 years
        Software                                    3 years
        Transportation equipment                    5 years
        Leasehold improvements        Lesser of 5 years or remaining lease term

Reclassifications

         Certain reclassifications have been made in the June 30, 2000 financial
statements to conform with the June 30, 2001 presentation.

NOTE 2 - ACQUISITIONS

         On November 18, 1998,  Freedom  Funding,  Inc., a Colorado  corporation
("FFI"), entered into a reorganization agreement (Reorganization Agreement) with
CyberQuest,   Inc.,  a  Colorado  corporation  (CyberQuest),   as  well  as  the
shareholders  of  CyberQuest,   pursuant  to  which  FFI  acquired  all  of  the
outstanding  proprietary  interest of CyberQuest  in a stock for stock  exchange
which resulted in CyberQuest  becoming a wholly owned  subsidiary of FFI and the
shareholders of CyberQuest  acquiring control of the Company through their stock
ownership. FFI also changed its name to CBQ, Inc. on this date.

         FFI,  under the  Reorganization  Agreement,  issued  18,000,000  common
shares and 70,000 shares of the Class A: Redeemable, Convertible Preferred Stock
of the Company to the  shareholders of CyberQuest in exchange for the issued and
outstanding shares of this subsidiary.

         The  acquisition of CyberQuest was treated as a reverse  acquisition of
FFI by CyberQuest.  In a reverse  acquisition the  shareholders of a Company own
less than 50% of the post  acquisition  shares.  The  shareholders of CyberQuest
received  approximately  80% of the post  acquisition  shares of the Company and
therefore,  CyberQuest is the accounting  acquirer.  Common stock and additional
paid-in  capital have been  restated to reflect the same ratio as the  Company's
common  stock  and  additional  paid-in  capital  at that  time.  This  business
combination was accounted for as a purchase.


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000
            ---------------------------------------------------------
                                   (Continued)

NOTE 2 - ACQUISITIONS Continued

         On March 15, 1999,  the Company merged with Reliance and its subsidiary
in a tax-free exchange. All of the outstanding shares of Reliance were exchanged
for 1,000,000 restricted common shares of the Company. This business combination
was accounted for as a pooling of interests.

         On April 9, 1999,  the Company  merged with  Priority One in a tax-free
exchange.  All of the  outstanding  shares of Priority  One were  exchanged  for
900,000 restricted common shares of the Company.  This business  combination was
accounted for as a pooling of interests.

         On November 15, 1999,  Quantum  Group  acquired all of the  outstanding
shares of  Quantum  Distribution  for 250  shares of  Quantum  Group's  Series B
preferred  stock,  valued at  $250,000,  plus  $125,000 in cash.  This  business
combination was accounted for as a purchase.

         On January 14, 2000,  the Company  merged with  ChinaSoft in a tax-free
exchange.  All of  the  outstanding  shares  of  ChinaSoft  were  exchanged  for
30,000,000  restricted common shares of the Company.  This business  combination
was accounted for as a pooling of interests.

         On April 1, 2000 Quantum  Group,  prior to its merger with the Company,
acquired  all of the  outstanding  shares of DPI for  $200,000 in cash,  290,000
shares of Quantum  Group's Series A common stock,  275 shares of Quantum Group's
Series C preferred stock,  plus 550 shares of Quantum Group's Series D preferred
stock. This business  combination was accounted for as a purchase,  resulting in
$972,000 of goodwill that is being amortized over five years.

         On August 8,  2000,  the  Company  merged  with  Quantum  Group and its
subsidiaries  in a tax- free exchange.  All of the  outstanding  common stock of
Quantum  Group was  exchanged  for  11,508,568  restricted  common shares of the
Company.  This business combination was accounted for as a pooling of interests.
450 shares of Quantum  Group's  Series D  preferred  stock were  converted  into
720,000 shares of the Company's common stock on August 31, 2000.

         On March 1, 2001, the Company purchased Easy Soft  International,  Inc.
("Easy  Soft").  The  purchase  price was  5,625,000  shares of common  stock in
exchange for all of the outstanding preferred and common shares of Easy Soft.

         On March 27,  200l the  Company  purchased  certain  assets of  Technet
Computer  Services,  Inc. and  Networkland,  Inc. for 7,800,000 shares of voting
common  stock and a 10% note  payable  of  $700,000  in  exchange  for which the
Company received assets valued at $1,106,720.  In addition,  the Company assumed
an $80,000 liability of the Parent, Socrates Technologies Corp, Inc.



<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000
            ---------------------------------------------------------
                                   (Continued)

NOTE 3 - INVESTMENTS

         On May 11, 1999, the Company  acquired 19% of the outstanding  interest
of Global  Logistics  Partners,  LLC  ("GLP"),  a privately  held Texas  limited
liability company in a tax-free exchange.  This interest was acquired solely for
the issuance of 4,233,200 common shares.

NOTE 4 - LINE OF CREDIT

         Quantum Group has an outstanding  balance of $912,157 under its line of
credit payable to a bank at June 30, 2001 with interest at the bank's prime rate
or LIBOR  plus  2.5%  which  expired  on April 1,  2001.  The line of  credit is
collateralized by substantially  all of the company's assets,  and is personally
guaranteed by certain of the company's officers and stockholders.

         The line of credit agreement with the bank contains  various  covenants
pertaining  to  maintenance  of certain debt  coverage and leverage  ratios.  In
addition,  the  agreement  restricted  entrance  into any merger or  acquisition
agreement  without  prior  written  consent  of the bank.  At June 30,  2001 the
company  was not in  compliance  with  the  covenants.  Under  the  terms of the
agreement,  the bank may call the loan if the  company  is in  violation  of any
restrictive covenant.

NOTE 5 - DUE TO SHAREHOLDERS

         Due to  shareholders at June 30, 2001 and December 31, 2000 consists of
the following:

<TABLE>
<CAPTION>

                                                                      June 30,          December 31,
                                                                        2001                2000
                                                                 ------------------- ------------------

Demand note payable, unsecured, with interest at
 15%, payable monthly.  Principal and
  accrued interest due on this note payable are
<S>                                                              <C>                 <C>
  subordinated to all bank debt.                                 $            50,000 $           50,000

Advances, unsecured, non-interest bearing,
due on demand                                                                 65,000             65,000
                                                                 ------------------- ------------------

                                                                 $           115,000 $          115,000
                                                                 =================== ==================
</TABLE>


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000
            ---------------------------------------------------------
                                   (Continued)

NOTE 6 - LONG-TERM DEBT

Long-term debt at June 30, 2001 and December 31, 2000 consists of the following:

<TABLE>
<CAPTION>

                                                                      June 30,          December 31,
                                                                        2001                2000
                                                                 ------------------- ------------------
<S>                                                              <C>                 <C>
Note payable, bank, with interest at 8.66%,
  payable in monthly installments of principal
  of $5,555 plus interest through April 30, 2003                 $     144,384       $          166,294

Capital lease obligations, at interest rates
  ranging from 4.90% to 14.17%, payable in monthly
  installments of $3,461 through the maturity dates
  ranging from November 2000 to February 2004                          23,318                    34,753

Subordinated debenture due in monthly installments
  of 12% interest only until April 30, 2003; 13.5%
  beginning May 1, 2003; 14% beginning May 1, 2004 and
  continuing thereafter. Beginning May 1, 2002
  monthly principal installments of $20,000 are due
  until maturity on April 30, 2006                                   1,200,000                1,200,000

Subordinated debenture due in monthly installments
  of 12% interest only until September 30, 2001;
  13% beginning October 1, 2001; 14% beginning
  October 1, 2002 and continuing thereafter.
  Principal and any unpaid interest due at
  maturity date on October 1, 2005                                     500,000                  500,000

Note payable, with interest of 10% payable in
  Quarterly installments of interest only.
  Principal and any unpaid interest due at
  maturity date on March 1, 2004                                       700,000                        -
                                                                 ------------------- ------------------

                                                                      2,567,702               1,901,047

      Less amounts due within one year                                 105,996                   87,908
                                                                 ------------------- ------------------

                                                                 $    2,461,706      $        1,813,139
                                                                 =================== ==================
</TABLE>
<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000
            ---------------------------------------------------------
                                   (Continued)

NOTE 6 - LONG-TERM DEBT continued

                       The following are maturities of long-term debt:

                                                               Period Ending
                                                               June 30, 2001
                                                           --------------------

                                               2001        $            105,996
                                               2002                     314,300
                                               2003                     967,406
                                               2004                     240,000
                                               2005                     940,000
                                               2006                           -
                                                           --------------------

                                                           $          2,567,702
                                                           ====================

NOTE 7 - LEASES

The Company leases  facilities and equipment under various capital and operating
leases with expiration dates through 2004.

Equipment  capitalized  under capital leases had fair market value of $73,000 as
of April 1, 2000 (date of  acquisition  of the equipment  and  assumption of the
related  leases by the  Company).  Total rental  expense for the Company for the
years ended December 31, 2000 and 1999 was $153,106 and $159,045,  respectively,
including rent under month-to month leases.

Net minimum rental commitments under all non-cancelable  operating leases are as
follows:
<TABLE>
<CAPTION>

                                                             Capital             Operating
                Year Ending December 31,                      Leases              Leases               Total
                                                        ------------------  -------------------  ------------------

<S>                       <C>                           <C>                 <C>                  <C>
                          2001                          $           16,958  $           123,354  $          140,312
                          2002                                      11,804              106,304             118,108
                          2003                                       8,189               83,286              91,475
                          2004                                       1,869               63,882              65,751
                                                        ------------------  -------------------  ------------------

            Total minimum lease payments due                        38,820              376,826             415,646

           Less amounts representing interest                      (4,068)                    -             (4,068)
                                                        ------------------  -------------------  ------------------

                                                        $           34,752  $           376,826  $          411,578
                                                        ==================  ===================  ==================
</TABLE>
<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000
            ---------------------------------------------------------
                                   (Continued)

NOTE 8 - PREFERRED STOCK OF SUBSIDIARY

         Quantum Group has two classes of preferred stock  outstanding.  Class B
preferred stock has no dividend rights and an aggregate  liquidation  preference
of $250,000. Class C preferred stock has total stated amount of $275,000. All of
the Class C  preferred  stock has 8%  cumulative  dividend  rights on the stated
amount, which aggregates $275,000. Dividends on the Class C preferred stock were
last declared and paid during the third quarter of 2000.

NOTE 9 - CONTINGENCIES

         CBQ,  Inc.  had an  agreement  with a funding  source  to sell  certain
receivables  with recourse.  In the event of the customer's  default the company
must  repurchase the receivables  from the funding source.  As of June 30, 2001,
the company is  contingently  liable in the amount of $783,000  relating to such
receivables sold with recourse.

         The  Company is a  defendant  in several  lawsuits.  In the  opinion of
Company  management,  none of these lawsuits will have a material adverse impact
on the Company's consolidated financial position,  results of operations or cash
flows.

NOTE 10 - PREFERRED STOCK

         The Company has the option to call the preferred stock as follows:

7,000  shares at the greater of $10.00 per share or the traded  market  value of
the preferred stock on or before October 23, 1999

21,000  shares at the greater of $10.715 per share or the traded market value of
the preferred stock on or before October 23, 2000

42,000  shares at the greater of $11.905 per share or the traded market value of
the preferred stock on or before October 23, 2001

70,000  shares at the greater of $12.50 per share or the traded  market value of
the preferred stock on or before October 23, 2002

NOTE 11 - COMMON STOCK
         During 2000,  the Company  settled  liabilities of $923,398 in exchange
for 1,658,920 shares of common stock.


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2001 AND 2000
            ---------------------------------------------------------
                                   (Continued)

NOTE 12 - STOCK OPTIONS


         The options have a five-year  life and are currently  exercisable.  The
following  summarizes stock option activity during the six months ended June 30,
2001 and year ended December 31, 2000:
<TABLE>
<CAPTION>


                                              Six Months Ended                   Year Ended December 31,
                                                June 30, 2001                             2000
                                     -----------------------------------  -------------------------------------
                                                           Exercise                               Exercise
                                         Shares          Price/Share            Shares           Price/Share
                                     ---------------  ------------------  ------------------  -----------------
Options outstanding,
<S>                                  <C>              <C>                 <C>                 <C>
  Beginning of period:                     7,715,708          -                    5,545,471          -
Options granted                            8,625,000     $0.25-$2.125              3,050,000    $1.00-$2.125
Options exercised                                  -          -                     (662,263)      $2.125
Options canceled                                   -          -                     (217,500)      $2.125
                                     ---------------                      ------------------
   Options outstanding,
         End of period:                   16,340,708     $1.00-$2.125              7,715,708    $1.00-$2.125
                                     ===============                      ==================
</TABLE>

Substantially  all of the options are exercisable  during five-year periods from
the dates of grant.


Item 2.  Management's Discussion and Analysis or Plan of Operation

         This  Quarterly  Report  contains  certain  forward-looking  statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section  21E of the  Securities  Exchange  Act of 1934,  as  amended,  which are
intended  to be covered  by the safe  harbors  created  thereby.  Investors  are
cautioned that all  forward-looking  statements  involve risks and  uncertainty,
including  without  limitation,  the  ability  of the  Company to  continue  its
expansion  strategy,  changes in costs of raw  materials,  labor,  and  employee
benefits,  as  well as  general  market  conditions,  competition  and  pricing.
Although   the   Company   believes   that  the   assumptions   underlying   the
forward-looking   statements  contained  herein  are  reasonable,   any  of  the
assumptions could be inaccurate,  and therefore,  there can be no assurance that
the  forward-looking  statements included in this Quarterly Report will prove to
be accurate. In light of the significant  uncertainties inherent in the forward-
looking statements included herein, the inclusion of such information should not
be  regarded  as a  presentation  by the  Company or any other  person  that the
objectives and plans of the Company will be achieved.

         As used  herein  the term  "Company"  refers to CBQ,  Inc.,  a Colorado
corporation and its predecessors and subsidiaries,  unless the context indicates
otherwise.



<PAGE>



Business of the Company and its Subsidiaries:

         CBQ  exhibits  core   competency  in  the  United  States   Information
Technology  software  industry with offices in Hunt Valley,  Maryland and Miami,
Florida and significant  private industry and governmental  relationships in the
People's Republic of China. In January 2000, CBQ merged with ChinaSoft Inc., the
private industry partner of the state-owned software development companies.  CBQ
may call on ChinaSoft's  substantial  programmer resources for contract software
development or outsourcing.  CBQ also works jointly with a privately owned China
based  software  development  and  outsourcing  company  with  English  language
expertise in both management and staff.  These resources are capable of offering
software  services  in  virtually  any  programming  language to the US. CBQ can
deliver these services through software product offerings and outsourcing and/or
project development, both in the US and in China.

         CBQ's lines of businesses include software development outsourcing, web
development,  custom  software  development,  network  systems  integration  and
management.  These lines of business are  reflective  of the  Company's  renewed
focus on these business segments.

         The Company is in the  process of  attempting  to identify  and acquire
favorable  business  opportunities.  The Company has  reviewed  and  evaluated a
number of business  ventures for possible  acquisition or  participation  by the
Company.  Other than  previously  mentioned the Company has not entered into any
agreement,  nor does it have any  commitment or  understanding  to enter into or
become  engaged in a  transaction  as of the date of this  filing.  The  Company
continues to investigate,  review,  and evaluate business  opportunities as they
become  available  and will  seek to  acquire  or  become  engaged  in  business
opportunities at such time as specific opportunities warrant.

Results of Operations

         As the world  increasingly  becomes reliant upon  information and data,
companies   will  continue  to  invest  in  highly   reliable  and  scalable  IT
infrastructures.

         As an End to End  e-business  solutions  provider,  CBQ offers a unique
value  proposition  and is well positioned to become a major vendor for software
and hardware in the Information  Technology Market. The company's strategy is to
have diverse streams of revenue including software development,  hardware sales,
and  networking  and  integration  services.  The  Company  has a solid  base of
business in the mid-Atlantic  region,  and will rely on sources in China and the
United States to provide the lowest available costs to its customers.  While the
software market in the United States has softened  considerably in 2001, CBQ, as
a result of its ability to import low cost, high quality software  services from
China,  is poised to become an even more important  player in coming years.  CBQ
has developed  connections  in China in both the private and public sectors that
will  allow  it  to  implement  software  solutions,  build  Web  sites,  manage
databases, and provide supply chain management solutions for U.S. customers. Due
to the  deteriorating  IT  spending  climate  it will  be  imperative  for  U.S.
companies to outsource  software  development and to use the most cost effective
source of supply, which is now China.  Companies that have been using India as a
source of outsourced  software  will  increasingly  turn to China,  which is 30%
lower cost on the average than software programmers from India.


<PAGE>



         In addition, IT hardware cost will continue to decline. In this climate
the  connections CBQ has in China that will allow the Company to import personal
computers,  laptop  computers,  and personal  digital  assistants  will give the
Company a major price advantage over its U.S. competitors.

         Networking and integration services will also continue to be in demand,
and CBQ, in tandem with partners such as Lockheed-Martin and Verizon,  will be a
major player in the Mid-Atlantic market.

         CBQ has grown steadily since current  management assumed control of the
Company on January 14,  2000.  In the first six months of 2000,  the revenues of
CBQ, on a non-pooled  accounting basis, were $336,420,  with losses of $308,795,
or 90% of  revenues.  In the first six months of 2001,  the revenues of CBQ were
$3,712,859,  while  losses  were  $821,465,  or 22% of  revenue.  Revenues  grew
eleven-fold, while losses grew by a much lower factor (2.6).

         In the second quarter of 2000, ending on June 30, 2000, the revenues of
CBQ,  on a non-  pooled  accounting  basis,  were  $116,504,  while  losses were
$167,669.  In the second quarter of 2001,  the revenues of CBQ were  $2,240,368,
with losses of $742,357,  or $.01 per share. Thus, the revenues of CBQ grew by a
factor of 20 quarter to quarter,  while losses sharply decreased as a percentage
of revenues from over 100% to under 30% of revenues.

         While  revenues  were  pooled  for tax and  accounting  reasons  in the
various transactions in the second quarter involving Easysoft,  Networkland, and
Technet,  the appropriate  "real world" way to look at the situation is in terms
of CBQ's  revenues on a non-pooled  basis until August 8, 2000 when CBQ acquired
Quantum Technology Group. This clarifies the accounting  situation,  which state
the consolidated statement of operations on a pooled basis in this filing.

Continuing Operations:

         The Company has had recurring  losses during its development  stage and
during the short period in which it has been in operations.  Management believes
that the losses  incurred in 2000 will be abated in 2001,  and will  continue to
pursue a two-track  strategy to address the cash needs of  CBQ--internal  growth
and  acquisitions.  The acquisitions of EasySoft and Technet will strengthen the
software  capabilities  of  CBQ,  and  permit  the  marketing  of  its  software
development  expertise  on an  ever-broadening  scale.  CBQ  plans to  develop a
sustainable competitive advantage by outsourcing the majority of the programming
labor to skilled  software  engineers  located in China ("the  China  team") and
India ("the India team").  The  acquisition of Networkland  will  strengthen the
hardware,  networking,  and  integration  business  of  CBQ.  These  synergistic
acquisitions  will provide  management  efficiencies,  economies of scale, and a
broader reach into the District of Columbia and Virginia..

Three Months Ended June 30, 2001 and 2000

         Revenues  for the  three  months  ending  June 30,  2001  increased  by
$142,000 primarily as a result of the acquisitions  during the later part of the
first quarter.  The cost of revenues  decreased to 81% of revenue from 84% which
has resulted from the company's change in products.


<PAGE>



         The increase in sales and marketing nearly doubled from the same period
ending  June 30,  2000  which  reflects  the change in the  company's  marketing
strategy towards system integration and the targeting of a new customer base.

         The 35%  decrease  in general  and  administrative  expenses  from 2000
reflects the company's  on-going  pursuit of new  acquisitions  and economies of
integration including accounting and overhead costs.

         Although  not  operating  in the black the  company  continues  to show
improvement.  The  company  recorded a net loss from  continuing  operations  of
$754,000  for the  three  months  ended  June  30,  2001  compared  to a loss of
$1,139,000 for the three months ended June 30, 2000.

Six Months Ended June 30, 2001 and 2000

         Revenues  for  the  six  months  ending  June  30,  2001  decreased  by
$1,377,000  from the same period ending June 30, 2000.  The decrease is a result
of a  change  in  the  company's  business  model  in  its  subsidiary,  Quantum
Distribution. In a declining parts and distribution market, the company switched
its model to white box custom builds where there continues to be a strong growth
pattern  and  higher  profit  margins.  The  decrease  in costs of  revenues  of
$1,229,000  is primarily a result of this change in  strategy.  Cost of revenues
includes direct salaries and related payroll taxes,  product costs,  and outside
services charged to customers.

         The increase in sales and  marketing  of $299,000  from the same period
ending June 30, 2000  reflects the change in the  company's  marketing  strategy
towards system  integration  and the targeting of a new customer base as well as
the  development  of a sales and  marketing  team which  began in the October of
2000. Sales and marketing  includes salaries,  commissions,  and related payroll
taxes for the sales team,  advertising and marketing  costs, and related selling
costs such as travel, meals and entertainment.

         The decrease in general and  administrative  expenses of $114,000  from
2000 reflects the company's  on-going  pursuit of new acquisitions and economies
of integration including accounting and overhead costs.

         Depreciation and  amortization  expenses  increased  $63,000 from 2000.
These increases  reflect the goodwill  amortization as a result of the company's
current period acquisitions.

         The Company recorded a net loss from continuing  operations of $821,464
for the six months  ended June 30,  2001.  The company  continues  to refine its
business model,  acquisition philosophy,  and marketing strategy in an effort to
compete in the ever-changing technology industry.

Capital Resources and Liquidity

         Liquidity for the company is primarily  generated by issuance of common
stock, stockholder loans and vendor financing.



<PAGE>



         At June 30, 2001,  the Company had total  current  assets of $2,163,000
and total assets of  $4,157,000  as compared to  $1,452,000  current  assets and
$2,925,000  total  assets at December  31,  2000.  The Company had a net working
capital  deficit of $2,332,000  and $2,194,000 at June 30, 2001 and December 31,
2000.

         Net stockholders'  deficit in the Company was $2,665,000 and $3,059,000
as of June 30, 2001 and December 31, 2000.



                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

No material  legal  proceedings to which the Company (or any officer or director
of the Company,  or affiliate  or owner of record or  beneficially  of more than
five percent of the Common Stock,  to  management's  knowledge) is a party or to
which the  property of the Company is subject is pending,  and no such  material
proceeding is known by management of the Company to be contemplated.

ITEM 2.  CHANGES IN SECURITIES

None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

None/Not Applicable.

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

None/Not Applicable.

ITEM 5.  OTHER INFORMATION

         The financial statements of the EasySoft  International,  Inc., Technet
Computer  Services,  Inc. and  Networkland,  Inc. and  proforma  financials  are
included immediately following the signature page to this report.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a) EXHIBITS

(b) Reports on Form 8-K.

         The Company filed Form 8K on May 11, 2001 reporting the  acquisition of
assets of Technet


<PAGE>


         and Networkland.  See Item 5 above for proforma disclosures.

                                   SIGNATURES

         In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized, this 17th day of August, 2001.

CBQ, Inc.


/s/ Bart S. Fisher
------------------------
Bart S. Fisher
Chairman and Chief Executive Officer



/s/ Leann Zawodniak
Leann Zawodniak
Chief Financial Officer


August 17, 2001


<PAGE>
                          EASYSOFT INTERNATIONAL, INC.

                                       -:-

                          INDEPENDENT AUDITOR'S REPORT


                           DECEMBER 31, 2000 AND 1999

                                       AND

                       MARCH 31, 2001 AND 2000 (UNAUDITED)





<PAGE>






                                    CONTENTS
<TABLE>
<CAPTION>


                                                                                                           Page

<S>                                                                                                        <C>
Independent Auditor's Report...............................................................................F - 1

Balance Sheets
  March 31, 2001 and 2000 (unaudited) and
  December 31, 2000 and 1999...............................................................................F - 2

Statements of Operations for the
  Three Months Ended March 31, 2001 and 2000 (unaudited) and
  Years Ended December 31, 2000 and 1999...................................................................F - 3

Statement of Stockholders' Equity
   Three Months Ended March 31, 2001 and 2000 (unaudited) and
   Years Ended December 31, 2000 and 1999..................................................................F - 4

Statements of Cash Flows for the
  Three Months Ended March 31, 2001 and 2000 (unaudited) and
  Years Ended December 31, 2000 and 1999...................................................................F - 5

Notes to Financial Statements..............................................................................F - 7
</TABLE>



<PAGE>







                          INDEPENDENT AUDITOR'S REPORT


EasySoft International, Inc.


         We  have   audited  the   accompanying   balance   sheets  of  EasySoft
International, Inc. as of December 31, 2000 and 1999, and the related statements
of  operations,  stockholder's  equity  and cash  flows for the two years  ended
December 31, 2000.  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 generally  accepted auditing
standards.  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  EasySoft
International,  Inc.  as of  December  31,  2000 and 1999 and the results of its
operations  and its cash flows for the two years then ended in  conformity  with
generally accepted accounting principles.


                                                   Respectfully submitted


                                                   /S/ ROBISON, HILL & CO
                                                   Certified Public Accountants







Salt Lake City, Utah
July 11, 2001

                                      F - 1

<PAGE>



                          EASYSOFT INTERNATIONAL, INC.
                                 BALANCE SHEETS

<TABLE>
<CAPTION>

                                                                (Unaudited)
                                                                 March 31,                   December 31,
                                                                                 -------------------------------------
                                                                   2001                2000                1999
                                                             -----------------   -----------------  ------------------
ASSETS
Current Assets
<S>                                                          <C>                 <C>                <C>
   Cash                                                      $          11,961   $           3,586  $          138,555
   Accounts Receivable                                                  67,543              10,275                   -
   Employee Advances                                                    23,300              20,500               3,300
   Available-for-Sale Investments                                          402             155,346             355,103
                                                             -----------------   -----------------  ------------------
        Total Current Assets                                           103,206             189,707             496,958
                                                             -----------------   -----------------  ------------------

Property & Equipment
   Computer Equipment and Software                                      37,599              37,599              34,495
   Less Accumulated Depreciation                                       (34,495)            (28,282)            (18,576)
                                                             -----------------   -----------------  ------------------
        Net Property & Equipment                                         3,104               9,317              15,919
                                                             -----------------   -----------------  ------------------

Other Assets
   Deposits                                                              2,077               2,077               2,077
                                                             -----------------   -----------------  ------------------

        Total Assets                                         $         108,387   $         201,101  $          514,954
                                                             =================   =================  ==================


LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities
   Accounts Payable                                          $             846   $           2,656  $           23,746
   Accrued Liabilities                                                   1,676               3,734              21,277
                                                             -----------------   -----------------  ------------------
        Total Current Liabilities                                        2,522               6,390              45,023
                                                             -----------------   -----------------  ------------------

Stockholder's Equity
  Common Stock, Par value $1.00
    Authorized 1,000 shares,
    Issued 1,000 shares at December 31, 2000
    and 1999 and March 31, 2001                                          1,000               1,000               1,000
   Additional Paid in Capital                                           13,078              13,078              13,078
   Accumulated Other Comprehensive Income                                    -               4,856              39,365
   Retained Earnings                                                    91,787             175,777             416,488
                                                             -----------------   -----------------  ------------------
        Total Stockholder's Equity                                     105,865             194,711             469,931
                                                             -----------------   -----------------  ------------------

        Total Liabilities and Stockholder's Equity           $         108,387   $         201,101  $          514,954
                                                             =================   =================  ==================
</TABLE>

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


                                      F - 2

<PAGE>



                          EASYSOFT INTERNATIONAL, INC.
                            STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                        (Unaudited)
                                                       For the three
                                                       months ended                      For the year ended
                                                         March 31,                          December 31,
                                             ---------------------------------   ----------------------------------
                                                   2001             2000               2000              1999
                                             ----------------  ---------------   ----------------  ----------------
REVENUES
<S>                                          <C>               <C>               <C>               <C>
   Sales                                     $        192,165  $       504,093   $      1,162,508  $        889,353
   Cost of Sales                                      129,886          357,906            823,624           464,782
                                             ----------------  ---------------   ----------------  ----------------

        Gross Margin                                   62,279          146,187            338,884           424,571
                                             ----------------  ---------------   ----------------  ----------------

EXPENSES
   Advertising                                              -            5,000              9,718             7,268
   General and Administrative                          16,327           35,727            225,539           100,788
                                             ----------------  ---------------   ----------------  ----------------

       Total Expenses                                  16,327           40,727            235,257           108,056
                                             ----------------  ---------------   ----------------  ----------------

       Earnings (Loss) from Operations                 45,952          105,460            103,627           316,515
                                             ----------------  ---------------   ----------------  ----------------

Other Income (Expense)
   Interest Income                                        383            1,565              8,047             2,132
   Dividends                                               83                -                385
   Interest Expense                                         -                -               (116)                -
   Gain (Loss) on Sale of Investments                       -                -           (182,654)           31,362
                                             ----------------  ---------------   ----------------  ----------------

        Net Other Income (Loss)                           466            1,565           (174,338)           33,494
                                             ----------------  ---------------   ----------------  ----------------

Net Income (Loss)                            $         46,418  $       107,025   $        (70,711) $        350,009
                                             ================  ===============   ================  ================

Weighted Average Shares
 Outstanding                                            1,000            1,000              1,000             1,000
                                             ================  ===============   ================  ================

Income (Loss) Per Share                      $          46.42  $        107.03   $        (70.72)  $         350.01
                                             ================  ===============   ================  ================
</TABLE>




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

                                      F - 3

<PAGE>

                          EASYSOFT INTERNATIONAL, INC.
                        STATEMENT OF STOCKHOLDERS' EQUITY
                     SINCE JANUARY 1, 1999 TO MARCH 31, 2001

<TABLE>
<CAPTION>

                                                                                        Accumulated
                                                                       Additional          Other
                                                 Common Stock           Paid-in        Comprehensive        Retained
                                           ------------------------
                                              Shares       Amount       Capital           Income            Deficit
                                           -------------  ---------  -------------- ------------------- ----------------

<S>                                        <C>            <C>        <C>            <C>                 <C>
Balance at January 1, 1999                         1,000  $   1,000  $       13,078 $                 - $         66,479

Comprehensive income:
  Net Income                                           -          -               -                   -          350,009
  Unrealized holding gains                             -          -               -              39,365                -
                                           -------------  ---------  -------------- ------------------- ----------------

Balance at December 31, 1999                       1,000      1,000          13,078              39,365          416,488

Accumulated Earnings Distribution                      -          -               -                   -         (170,000)

Comprehensive income:
  Net Loss                                             -          -               -                   -          (70,711)
  Unrealized holding losses                            -          -               -             (34,509)               -
                                           -------------  ---------  -------------- ------------------- ----------------

Balance at December 31, 2000                       1,000      1,000          13,078               4,856          175,777

Accumulated Earnings Distribution                      -          -               -                   -         (130,408)

Comprehensive income:
  Net Loss                                             -          -               -                   -           46,418
  Unrealized holding losses                            -          -               -              (4,856)               -
                                           -------------  ---------  -------------- ------------------- ----------------

Balance at March 31,
  2001 (unaudited)                                 1,000  $   1,000  $       13,078 $                 - $         91,787
                                           =============  =========  ============== =================== ================
</TABLE>








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

                                      F - 4

<PAGE>



                          EASYSOFT INTERNATIONAL, INC.
                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>


                                                             (unaudited)
                                                            For the three
                                                             months ended                For the Year Ended
                                                              March 31,                     December 31,
                                                     ---------------------------- ---------------------------------
                                                         2001           2000            2000             1999
                                                     -------------  ------------- ---------------- ----------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
<S>                                                  <C>            <C>           <C>              <C>
Net Income (Loss)                                    $      46,418  $     107,025 $        (70,711)$        350,009
Adjustments used to reconcile net income
to net cash provided by (used in)
operating activities:
   Depreciation and amortization                             6,213          2,426            9,706            7,337
Changes in operating assets and liabilities:
   (Increase) Decrease in accounts receivable              (57,268)       (82,592)         (10,275)               -
   (Increase) Decrease in employee advances                 (2,800)       (52,800)         (17,200)          (3,300)
   Increase (Decrease) in accounts payable                  (1,810)       (16,281)         (21,090)          43,484
   Increase (Decrease) in accrued liabilities               (2,058)       (15,615)         (17,543)          (4,089)
                                                     -------------  ------------- ---------------- ----------------
Net cash provided by operating activities                  (11,305)       (57,837)        (127,113)         393,441
                                                     -------------  ------------- ---------------- ----------------

CASH FLOWS FROM INVESTING
ACTIVITIES:
-----------
Cash received from sale of
   available-for-sale investments                          179,272        905,178        2,407,793          315,737
Acquisition of available-for-sale investments              (29,184)      (842,816)      (1,972,607)        (593,942)
Acquisition of Property and Equipment                            -              -           (3,104)         (12,823)
                                                     -------------  ------------- ---------------- ----------------
Net cash used by investing activities                      150,088         62,362          432,082         (291,028)
                                                     -------------  ------------- ---------------- ----------------

CASH FLOWS FROM FINANCING
ACTIVITIES:
Accumulated Earnings Distribution                         (130,408)             -         (170,000)               -
                                                     -------------  ------------- ---------------- ----------------
Net cash used in financing activities                     (130,408)             -         (170,000)               -
                                                     -------------  ------------- ---------------- ----------------

Net increase in cash and cash equivalents                    8,375          4,525         (134,969)         102,413
Cash and cash equivalents
   at beginning of period                                    3,586        138,555          138,555           36,142
                                                     -------------  ------------- ---------------- ----------------
Cash and cash equivalents
   at end of the period                              $      11,961  $     143,080 $          3,586 $        138,555
                                                     =============  ============= ================ ================
</TABLE>



                                      F - 5

<PAGE>



                          EASYSOFT INTERNATIONAL, INC.
                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                   (unaudited)
                                                                  For the three
                                                                  months ended               For the Year Ended
                                                                    March 31,                   December 31,
                                                         ------------------------------- --------------------------
                                                             2001             2000           2000         1999
                                                         -------------  ---------------- ------------ -------------

SUPPLEMENTAL DISCLOSURE OF
   CASH FLOW INFORMATION:

<S>                                                      <C>            <C>              <C>          <C>
Cash paid during the period for taxes                    $            - $              - $          - $           -
Cash paid during the period for interest                 $            - $              - $        116 $           -
</TABLE>


SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES:

None




















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

                                      F - 6

<PAGE>

                          EASYSOFT INTERNATIONAL, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited

NOTE 1 - NATURE OF OPERATIONS AND GOING CONCERN

Organization and Basis of Presentation

         The Company was incorporated  under the laws of the State of Florida on
June 2, 1995.  Effective  June 2, 1995 the owners of the  Company  elected to be
taxed as a S-Corporation.

         The  unaudited  financial  statements  as of March 31, 2001 and for the
three  months  ended  March  31,  2001  and  2000  reflect,  in the  opinion  of
management,  all adjustments  (which include only normal recurring  adjustments)
necessary to fairly state the financial  position and results of operations  for
the three  months.  Operating  results for interim  periods are not  necessarily
indicative of the results which can be expected for full years.

Nature of Business

         EasySoft International,  Inc. is an E-Commerce software developer.  The
Company started with the business of Web design and  development,  providing the
service of customized database  development over the Internet,  such as internet
domain  name  and  email  address  hosting.  In  1996,  the  Company  contracted
Government  project,  providing  the  services  of  programming,  LAN-based  and
Internet-enabled  database application for the Federal Welfare Program projects.
Recently,  the Company developed a E-commerce  platform program to let customers
sign on  E-commerce  stores and master OEM.  The Company  also  provides on line
shopping cart products and services.

Pervasiveness of Estimates

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  required  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.

Cash and Cash Equivalents

         For purposes of the statement of cash flows, the Company  considers all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.




                                      F - 7

<PAGE>

                          EASYSOFT INTERNATIONAL, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Advertising Expense

         Advertising costs are expensed when the services are provided.

Loss per Share

         The  reconciliations  of the numerators and  denominators  of the basic
loss per share computations are as follows:
<TABLE>
<CAPTION>


                                                                  March 31,                  December 31,
                                                          ------------------------- -------------------------------
                                                              2001         2000           2000            1999
                                                          ------------ ------------ ----------------  -------------
NUMERATOR
<S>                                                       <C>          <C>          <C>               <C>
Net Income (Loss) To Common Stockholder                   $     46,418 $    107,025 $        (70,711) $     350,009
                                                          ============ ============ ================  =============

DENOMINATOR
Weighted Average Number of Common Shares                         1,000        1,000            1,000          1,000
                                                          ============ ============ ================  =============

EPS
Basic & Diluted Earnings (Loss) Per Share                 $      46.42 $     107.03 $        (70.72)  $      350.01
                                                          ============ ============ ================  =============
</TABLE>


There are no other  potential  common  shares.  The effects of potential  common
shares such as warrants would be  anti-dilutive  in each of the period  December
31, 2000 and are thus not considered.

Concentration of Credit Risk

         The  Company has no  significant  off-balance-sheet  concentrations  of
credit  risk such as foreign  exchange  contracts,  options  contracts  or other
foreign  hedging  arrangements.  The Company  maintains the majority of its cash
balances with one financial institution, in the form of demand deposits.



                                      F - 8

<PAGE>

                          EASYSOFT INTERNATIONAL, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Investments

         The  Company's   securities   investments  that  are  bought  and  held
principally  for the purpose of selling them in the near term are  classified as
trading securities. Trading securities are recorded at fair value on the balance
sheet in  current  assets,  with the  change in fair  value  during  the  period
included in earnings.
<TABLE>
<CAPTION>

         Investments in securities are summarized as follows:

                                                                              December 31, 2000
                                                          ---------------------------------------------------------
                                                                Gross              Gross
                                                             Unrealized          Unrealized             Fair
                                                                Gain                Loss               Value
                                                          -----------------  ------------------  ------------------
<S>                                                       <C>                <C>                 <C>
Trading Securities                                        $          82,182  $           77,326  $          155,346
                                                          =================  ==================  ==================


                                                                              December 31, 1999
                                                          ---------------------------------------------------------
                                                                Gross              Gross
                                                             Unrealized          Unrealized             Fair
                                                                Gain                Loss               Value
                                                          -----------------  ------------------  ------------------
Trading Securities                                        $          39,365  $                -  $          355,103
                                                          =================  ==================  ==================
</TABLE>

         Realized  Gains and  losses  are  determined  on the basis of  specific
identification.  During  the years  ended  December  31,  2000 and  1999,  sales
proceeds and gross realized gains and losses on securities classified as trading
securities were:

<TABLE>
<CAPTION>

                                                                                  For the Year Ended
                                                                                     December 31,
                                                                             2000                     1999
                                                                    ----------------------   ----------------------

<S>                                                                 <C>                      <C>
Sale Proceeds                                                       $            2,407,793   $              315,737
                                                                    ======================   ======================

Gross Realized Losses                                               $              314,879   $                6,022
                                                                    ======================   ======================

Gross Realized Gains                                                $              132,225   $               37,384
                                                                    ======================   ======================
</TABLE>


                                      F - 9

<PAGE>

                          EASYSOFT INTERNATIONAL, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Property and Equipment

         Property and equipment are stated at cost. Depreciation is provided for
in amounts  sufficient  to relate the cost of  depreciable  assets to operations
over their estimated service lives,  principally on a straight-line basis from 3
to 5 years.

         Upon sale or other disposition of property and equipment,  the cost and
related  accumulated  depreciation or amortization are removed from the accounts
and any gain or loss is included in the determination of income or loss.

         Expenditures  for  maintenance  and  repairs  are charged to expense as
incurred.  Major overhauls and betterments are capitalized and depreciated  over
their useful lives.

         The Company  identifies  and records  impairment  losses on  long-lived
assets such as property and  equipment  when events and  circumstances  indicate
that such assets  might be  impaired.  The  Company  considers  factors  such as
significant  changes in the regulatory or business  climate and projected future
cash flows from the  respective  asset.  Impairment  losses are  measured as the
amount by which the carrying amount of intangible asset exceeds its fair value.

NOTE 2 - INCOME TAXES

         As  of  December  31,  2000,  the  Company  has  been  operating  as  a
Sub-chapter  S  corporation  and  thus  income  tax is  paid  on the  individual
shareholders' Form 1040 filed with the Internal Revenue Service.

NOTE 3 - COMMITMENTS AND RENT EXPENSE

         The Company  has  entered  into lease  agreements  for  various  office
facilities.  For the quarter ending March 31, 2001 and 2000 the rental  payments
were $5,044 and $4,453  respectively.  For the year ending December 31, 2000 and
1999 the rental payments  were$22,345 and $19,654  respectively.  Effective with
the sale of the business to CBQ, Inc. on March 1, 2001 the lease  obligations of
EasySoft International, Inc. were assumed by CBQ, Inc.




                                     F - 10

<PAGE>


                          EASYSOFT INTERNATIONAL, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited
                                   (Continued)


NOTE 4 - SUBSEQUENT EVENTS

         On March 1, 2001 the  shareholders'  of  EasySoft  International,  Inc.
entered into a stock purchase and exchange  agreement with CBQ, Inc. In exchange
for  5,625,000   common  shares  of  CBQ,  Inc.  the  shareholders  of  EasySoft
International, Inc. sold all of the outstanding shares of EasySoft International
to CBQ, Inc.


                                     F - 11


<PAGE>
                         TECHNET COMPUTER SERVICES, INC.

                                       -:-

                          INDEPENDENT AUDITOR'S REPORT


                           DECEMBER 31, 2000 AND 1999

                                       AND

                       MARCH 31, 2001 AND 2000 (UNAUDITED)





<PAGE>






                                    CONTENTS
<TABLE>
<CAPTION>


                                                                                                           Page

<S>                                                                                                        <C>
Independent Auditor's Report...............................................................................F - 1

Balance Sheets
  March 31, 2001 and 2000 (unaudited) and
  December 31, 2000 and 1999...............................................................................F - 2

Statements of Operations for the
  Three Months Ended March 31, 2001 and 2000 (unaudited) and
  Years Ended December 31, 2000 and 1999...................................................................F - 4

Statement of Stockholders' Equity
   Three Months Ended March 31, 2001 and 2000 (unaudited) and
   Years Ended December 31, 2000 and 1999..................................................................F - 5

Statements of Cash Flows for the
  Three Months Ended March 31, 2001 and 2000 (unaudited) and
  Years Ended December 31, 2000 and 1999...................................................................F - 6

Notes to Financial Statements..............................................................................F - 8
</TABLE>



<PAGE>







                          INDEPENDENT AUDITOR'S REPORT


Technet Computer Services, Inc.


         We have audited the  accompanying  balance  sheets of Technet  Computer
Services,  Inc. as of December 31, 2000 and 1999, and the related  statements of
operations, stockholder's equity and cash flows for the two years ended December
31, 2000.  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 generally  accepted auditing
standards.  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 Technet Computer
Services,  Inc.  as of  December  31,  2000  and  1999  and the  results  of its
operations  and its cash flows for the two years then ended in  conformity  with
generally accepted accounting principles.

         The accompanying  financial statements have been prepared assuming that
the Company  will  continue as a going  concern.  As  discussed in Note 1 to the
financial statements,  the Company has suffered recurring losses from operations
and has a net capital  deficiency that raise substantial doubt about its ability
to continue as a going  concern.  Management's  plans in regard to these matters
are also  described  in Note 1. The  financial  statements  do not  include  any
adjustments that might result from the outcome of this uncertainty.

                                                   Respectfully submitted


                                                   /S/ ROBISON, HILL & CO
                                                   Certified Public Accountants

Salt Lake City, Utah
June 6, 2001


                                      F - 1

<PAGE>



                         TECHNET COMPUTER SERVICES, INC.
                                 BALANCE SHEETS
<TABLE>
<CAPTION>
                                                             (Unaudited)
                                                              March 31,                   December 31,
                                                                             --------------------------------------
                                                                2001                2000                1999
                                                          -----------------  ------------------  ------------------
ASSETS
Current Assets
<S>                                                       <C>                <C>                 <C>
   Cash                                                   $               -  $          177,363  $          471,921
   Accounts Receivable                                              715,677           1,023,420           1,539,310
   Employee Advances                                                  9,135              33,995              42,907
   Other                                                             43,689              43,025              42,029
                                                          -----------------  ------------------  ------------------

        Total Current Assets                                        768,501           1,277,803           2,096,167
                                                          -----------------  ------------------  ------------------

Property & Equipment
   Transportation Equipment                                          30,070              30,070              30,070
   Furniture & Equipment                                             19,240              19,240              18,965
   Office Equipment                                                  20,952              20,952              19,907
   Computer Equipment and Software                                  605,171             605,171             599,042
                                                          -----------------  ------------------  ------------------
                                                                    675,433             675,433             667,984
   Less Accumulated Depreciation                                   (479,586)           (456,080)           (359,317)
                                                          -----------------  ------------------  ------------------

        Net Property & Equipment                                    195,847             219,353             308,667
                                                          -----------------  ------------------  ------------------

Other Assets
   Intangibles - Goodwill, Net                                            -                   -           2,639,286
   Deferred Tax Asset                                                     -                   -             123,880
                                                          -----------------  ------------------  ------------------

        Net Other Assets                                                  -                   -           2,763,166
                                                          -----------------  ------------------  ------------------

        Total Assets                                      $         964,348  $        1,497,156  $        5,168,000
                                                          =================  ==================  ==================
</TABLE>






                                      F - 2

<PAGE>

                         TECHNET COMPUTER SERVICES, INC.
                                 BALANCE SHEETS
                                   (continued)
<TABLE>
<CAPTION>
                                                                (Unaudited)
                                                                 March 31,                   December 31,
                                                                                 -------------------------------------
                                                                   2001                2000                1999
                                                             -----------------   -----------------  ------------------
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities
<S>                                                          <C>                 <C>                <C>
   Accounts Payable                                          $         380,861   $         462,927  $          398,770
   Checks Written in excess of Cash in Bank                             58,836                   -                   -
   Accrued Liabilities                                                   4,790              25,418             260,564
   Advances from Parent                                                984,288           1,476,013           1,676,394
   Short Term Notes Payable                                             19,500              35,500               4,500
                                                             -----------------   -----------------  ------------------

        Total Current Liabilities                                    1,448,275           1,999,858           2,340,228
                                                             -----------------   -----------------  ------------------

Stockholder's Equity
  Common Stock, Par value $.01
    Authorized 1,000 shares,
    Issued 1,000 shares at December 31, 2000
    and 1999 and March 31, 2001                                             10                  10                  10
   Additional Paid in Capital                                        2,379,990           2,379,990           2,379,990
   Retained Earnings (Deficit)                                      (2,863,927)         (2,882,702)            447,772
                                                             -----------------   -----------------  ------------------

        Total Stockholder's Equity (Deficit)                          (483,927)           (502,702)          2,827,772
                                                             -----------------   -----------------  ------------------

        Total Liabilities and Stockholder's Equity           $         964,348   $       1,497,156  $        5,168,000
                                                             =================   =================  ==================

</TABLE>











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


                                      F - 3

<PAGE>

                         TECHNET COMPUTER SERVICES, INC.
                            STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>

                                                        (Unaudited)
                                                       For the three
                                                       months ended                      For the year ended
                                                         March 31,                          December 31,
                                             ---------------------------------   ----------------------------------
                                                   2001             2000               2000              1999
                                             ----------------  ---------------   ----------------  ----------------
REVENUES
<S>                                          <C>               <C>               <C>               <C>
   Sales                                     $      1,094,990  $     1,458,821   $      4,926,152  $      7,411,103
   Cost of Sales                                      229,532          575,031          2,225,635         5,183,487
                                             ----------------  ---------------   ----------------  ----------------

        Gross Margin                                  865,458          883,790          2,700,517         2,227,616

EXPENSES
   General and Administrative                         824,950          860,923          5,755,988         1,872,950
                                             ----------------  ---------------   ----------------  ----------------

       Earnings (Loss) from Operations                 40,508           22,867         (3,055,471)          354,666

Other Income (Expense)
   Interest Income                                         56                -              9,214                 -
   Interest Expense                                   (21,789)         (28,689)          (122,336)         (100,668)
                                             ----------------  ---------------   ----------------  ----------------

        Net Other Income (Loss)                       (21,733)         (28,689)          (113,122)         (100,668)
                                             ----------------  ---------------   ----------------  ----------------

Income (Loss) Before Taxes                             18,775           (5,822)        (3,168,593)          253,998

Income Tax Expense (Benefit)                                -           38,000            161,881            (2,400)
                                             ----------------  ---------------   ----------------  ----------------

Net Income (Loss)                            $         18,775  $       (43,822)  $     (3,330,474) $        256,398
                                             ================  ===============   ================  ================

Weighted Average Shares
 Outstanding                                            1,000            1,000              1,000             1,000
                                             ================  ===============   ================  ================

Income (Loss) Per Share                      $          18.77  $       (43.88)   $     (3,330.47)  $         256.40
                                             ================  ===============   ================  ================
</TABLE>





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

                                      F - 4

<PAGE>

                         TECHNET COMPUTER SERVICES, INC.
                        STATEMENT OF STOCKHOLDERS' EQUITY
                     SINCE JANUARY 1, 1999 TO MARCH 31, 2001




<TABLE>
<CAPTION>

                                                     Common Stock              Paid-In          Retained
                                                Shares         Par Value       Capital          Deficit
                                            ---------------  ------------- ---------------  ----------------
<S>                                         <C>              <C>           <C>              <C>
Balance at January1, 1999                             1,000  $          10 $     2,379,990  $        191,374

Net Income                                                -              -               -           256,398
                                            ---------------  ------------- ---------------  ----------------

Balance at December 31, 1999                          1,000             10       2,379,990           447,772

Net Loss                                                  -              -               -        (3,330,474)
                                            ---------------  ------------- ---------------  ----------------

Balance at December 31, 2000                          1,000             10       2,379,990        (2,882,702)

Net Income                                                -              -               -            18,775
                                            ---------------  ------------- ---------------  ----------------

Balance March 31, 2001(unaudited)                     1,000  $          10 $     2,379,990  $     (2,863,927)
                                            ===============  ============= ===============  ================


</TABLE>














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

                                      F - 5

<PAGE>



                         TECHNET COMPUTER SERVICES, INC.
                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                             (unaudited)
                                                            For the three
                                                             months ended                For the Year Ended
                                                              March 31,                     December 31,
                                                     ---------------------------- ---------------------------------
                                                         2001           2000            2000             1999
                                                     -------------  ------------- ---------------- ----------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
<S>                                                  <C>            <C>           <C>              <C>
Net Income (Loss)                                    $      18,775  $     (43,822)$     (3,330,474)$        256,398
Adjustments used to reconcile net income
to net cash
provided by (used in) operating activities:
   Depreciation and amortization                            23,506        111,712        2,736,049          489,031
Changes in operating assets and liabilities:
   (Increase) Decrease in accounts receivable              307,743          8,398          515,890       (1,539,310)
   (Increase) Decrease in employee advances                 24,860          4,375            8,912          (42,907)
   (Increase) Decrease in other current assets                (664)             -             (996)         (42,029)
   (Increase) Decrease in deferred tax asset                     -              -          123,880         (123,880)
   Increase (Decrease) in accounts payable                 (82,066)      (160,750)          64,157          398,770
   Increase (Decrease) in checks written
      In excess of cash in bank                             58,836         27,348                -                -
   Increase (Decrease) in accrued liabilities              (20,628)      (260,556)        (235,146)         260,564
   Increase (Decrease) in advances parent                 (491,725)        78,689         (200,381)         810,784
                                                     -------------  ------------- ---------------- ----------------
Net cash provided by operating activities                 (161,363)      (234,606)        (318,109)         467,421
                                                     -------------  ------------- ---------------- ----------------

CASH FLOWS FROM INVESTING
ACTIVITIES:
Acquisition of Property and Equipment                            -           (276)          (7,449)               -
                                                     -------------  ------------- ---------------- ----------------
Net cash used by investing activities                            -           (276)          (7,449)               -
                                                     -------------  ------------- ---------------- ----------------

CASH FLOWS FROM FINANCING
ACTIVITIES:
Repayment of Long-Term Debt                                (16,000)        (1,798)          (9,000)               -
Proceeds of Long-Term Debt                                       -              -           40,000            4,500
                                                     -------------  ------------- ---------------- ----------------
Net cash used in financing activities                      (16,000)        (1,798)          31,000            4,500
                                                     -------------  ------------- ---------------- ----------------

Net increase in cash and cash equivalents                 (177,363)      (236,680)        (294,558)         471,921
Cash and cash equivalents
   at beginning of period                                  177,363        471,921          471,921                -
                                                     -------------  ------------- ---------------- ----------------
Cash and cash equivalents
   at end of the period                                          -  $     235,241 $        177,363 $        471,921
                                                     =============  ============= ================ ================
</TABLE>


                                      F - 6

<PAGE>

                         TECHNET COMPUTER SERVICES, INC.
                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                   (unaudited)
                                                                  For the three
                                                                  months ended               For the Year Ended
                                                                    March 31,                   December 31,
                                                         ------------------------------- --------------------------
                                                             2001             2000           2000         1999
                                                         -------------  ---------------- ------------ -------------

SUPPLEMENTAL DISCLOSURE OF
   CASH FLOW INFORMATION:
<S>                                                      <C>            <C>              <C>          <C>
Cash paid during the period for taxes                    $           -  $         38,000 $    161,881 $           -
Cash paid during the period for interest                 $      21,789  $         28,689 $    122,336 $     100,668

</TABLE>

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES:

None
















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

                                      F - 7

<PAGE>

                         TECHNET COMPUTER SERVICES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited

NOTE 1 - NATURE OF OPERATIONS AND GOING CONCERN

         The accompanying  financial  statements have been prepared on the basis
of accounting principles applicable to a "going concern",  which assume that the
Company  will  continue in  operation  for at least one year and will be able to
realize  its assets  and  discharge  its  liabilities  in the  normal  course of
operations.

         Several conditions and events cast doubt about the Company's ability to
continue  as  a  "going  concern".  The  Company  has  incurred  net  losses  of
approximately  $3,000,000  for the period from  January 1, 2000 to December  31,
2000, has a liquidity  problem,  and requires  additional  financing in order to
finance its business  activities  on an ongoing  basis.  The Company is actively
pursuing  alternative  financing  through and has had  discussions  with various
third parties,  although no firm  commitments  have been  obtained.  In addition
substantially  all of the  asset and some of the  liabilities  were sold to CBQ,
Inc. (see subsequent events footnote).

         The  Company's  future  capital  requirements  will  depend on numerous
factors  including,  but  not  limited  to,  continued  market  penetration  and
profitable operations from its employee leasing and software services.

         These  financial  statements do not reflect  adjustments  that would be
necessary  if the Company  were unable to continue as a "going  concern".  While
management believes that the actions already taken or planned, will mitigate the
adverse conditions and events which raise doubt about the validity of the "going
concern" assumption used in preparing these financial  statements,  there can be
no assurance that these actions will be successful.

         If the  Company  were unable to  continue  as a "going  concern",  then
substantial adjustments would be necessary to the carrying values of assets, the
reported amounts of its liabilities, the reported revenues and expenses, and the
balance sheet classifications used.

Organization and Basis of Presentation

         The Company was incorporated under the laws of the State of Virginia on
March  24,  1989.  The  Company  is  a  wholly  owned   subsidiary  of  Socrates
Technologies Corporation.

         The  unaudited  financial  statements  as of March 31, 2001 and for the
three  months  ended  March  31,  2001  and  2000  reflect,  in the  opinion  of
management,  all adjustments  (which include only normal recurring  adjustments)
necessary to fairly state the financial  position and results of operations  for
the three  months.  Operating  results for interim  periods are not  necessarily
indicative of the results which can be expected for full years.

                                      F - 8

<PAGE>

                         TECHNET COMPUTER SERVICES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Nature of Business

         As of March 31, 2001 the Company leases employees to CBQ, Inc. Prior to
March 27, 2001 the Company was in the business of providing software solutions.

Pervasiveness of Estimates

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  required  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.

Loss per Share

         The  reconciliations  of the numerators and  denominators  of the basic
loss per share computations are as follows:
<TABLE>
<CAPTION>


                                                                  March 31,                  December 31,
                                                          ------------------------- -------------------------------
                                                              2001         2000           2000            1999
                                                          ------------ ------------ ----------------  -------------
NUMERATOR
<S>                                                       <C>          <C>          <C>               <C>
Net Income (Loss) To Common Stockholder                   $     18,755 $    (43,822)$     (3,330,474) $     256,398
                                                          ============ ============ ================  =============

DENOMINATOR
Weighted Average Number of Common Shares                         1,000        1,000            1,000          1,000
                                                          ============ ============ ================  =============

EPS
Basic & Diluted Earnings (Loss) Per Share                 $      18.76 $    (43.83) $     (3,330.48)  $      256.40
                                                          ============ ============ ================  =============
</TABLE>


There are no other  potential  common  shares.  The effects of potential  common
shares such as warrants would be  anti-dilutive in each of the periods March 31,
2001 and December 31, 2000 and are thus not considered.


                                      F - 9

<PAGE>

                         TECHNET COMPUTER SERVICES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Property and Equipment

         Property and equipment are stated at cost. Depreciation is provided for
in amounts  sufficient  to relate the cost of  depreciable  assets to operations
over their estimated service lives,  principally on a straight-line basis from 3
to 5 years.

         Upon sale or other disposition of property and equipment,  the cost and
related  accumulated  depreciation or amortization are removed from the accounts
and any gain or loss is included in the determination of income or loss.

         Expenditures  for  maintenance  and  repairs  are charged to expense as
incurred.  Major overhauls and betterments are capitalized and depreciated  over
their useful lives.

         The Company  identifies  and records  impairment  losses on  long-lived
assets such as property and  equipment  when events and  circumstances  indicate
that such assets  might be  impaired.  The  Company  considers  factors  such as
significant  changes in the regulatory or business  climate and projected future
cash flows from the  respective  asset.  Impairment  losses are  measured as the
amount by which the carrying amount of intangible asset exceeds its fair value.

Cash and Cash Equivalents

         For purposes of the statement of cash flows, the Company  considers all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.

Concentration of Credit Risk

         The  Company has no  significant  off-balance-sheet  concentrations  of
credit  risk such as foreign  exchange  contracts,  options  contracts  or other
foreign  hedging  arrangements.  The Company  maintains the majority of its cash
balances with one financial institution, in the form of demand deposits.





                                     F - 10

<PAGE>

                         TECHNET COMPUTER SERVICES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Intangible Assets

         Intangible  assets  are valued at cost and are being  amortized  on the
straight-line  basis over a period of five  years.  The  amortization  period is
management's estimate of useful economic life of the asset.

         The Company  identifies  and records  impairment  losses on  intangible
assets  when  events  and  circumstances  indicate  that  such  assets  might be
impaired.  The Company  considers  factors  such as  significant  changes in the
regulatory  or  business  climate  and  projected  future  cash  flows  from the
respective  asset.  Impairment  losses are  measured  as the amount by which the
carrying  amount of intangible  asset  exceeds its fair value.  The goodwill has
been written off due to the sale of the majority of the assets.  (See subsequent
events)


NOTE 2 - INCOME TAXES

         As of March 31, 2001, the Company had a net operating loss carryforward
for income tax reporting  purposes of approximately  $450,000 that may be offset
against future taxable income through 2021. Current tax laws limit the amount of
loss  available to be offset  against  future  taxable income when a substantial
change in ownership  occurs.  Therefore,  the amount  available to offset future
taxable income may be limited. No tax benefit has been reported in the financial
statements,  because the Company  believes  there is a 50% or greater chance the
carryforwards will expire unused. Accordingly, the potential tax benefits of the
loss carryforwards are offset by a valuation allowance of the same amount.

NOTE 3 - EMPLOYEE BENEFIT PLAN

         The Company participates in a 401(k) retirement plan which is available
to all of its full time  employees.  For the quarter  ending  March 31, 2001 and
2000 the  expense  paid by the  Company  attributable  to the  benefit  plan was
$45,005 and $-0- and for the year ended  December 31, 2000 and 1999 was $850 and
$-0- respectively.





                                     F - 11

<PAGE>

                         TECHNET COMPUTER SERVICES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited
                                   (Continued)

NOTE 4 - COMMITMENTS AND RENT EXPENSE

         The Company  has  entered  into lease  agreements  for  various  office
facilities.  For the quarter ending March 31, 2001 and 2000 the rental  payments
were $33,587 and $55,805 respectively. For the year ending December 31, 2000 and
1999 the rental payments were$223,221 and $223,221 respectively.  Effective with
the sale of the business to CBQ, Inc. on March 27, 2001 the lease obligations of
Technet Computer Services, Inc. and Networkland, Inc. were assumed by CBQ, Inc.

         As of March 31, 2001 all  activities of the Company have been conducted
by corporate  officers from either their homes or business  offices.  Currently,
there  are no  outstanding  debts  owed by the  company  for  the  use of  these
facilities and there are no commitments for future use of the facilities.

NOTE 5 - SUBSEQUENT EVENTS

         On March 27, 2001 Socrates Technologies  Corporation the parent company
of Technet Computer Services,  Inc. and Networkland,  Inc. entered into an asset
purchase  agreement  with CBQ, Inc. In exchange for  7,650,000  common shares of
CBQ, Inc. and a promissory  note in the amount of $700,000 plus 10% interest due
March 1, 2004,  Socrates  Technologies  Corporation  sold essentially all of the
assets  and some of the  liabilities  of Technet  Computer  Services,  Inc.  and
Networkland,  Inc. to CBQ, Inc. The promissory  note is convertible  into common
shares of CBQ, Inc. anytime after twelve months at the rate of $.75 per share.

         In May 2001 Farshad  Sajedi a former  officer of Technet  filed a civil
action against  Technet for alleged breach of employment  agreement.  The action
was filed in the Circuit Court for Arlington County,  Virginia and seeks damages
in excess of $300,000.  Management believes that the action is frivolous because
the Company had sufficient cause for terminating Mr. Sajedi's employment.


                                     F - 12

<PAGE>

                                NETWORKLAND, INC.

                                       -:-

                          INDEPENDENT AUDITOR'S REPORT


                           DECEMBER 31, 2000 AND 1999

                                       AND

                       MARCH 31, 2001 AND 2000 (UNAUDITED)





<PAGE>






                                    CONTENTS

<TABLE>
<CAPTION>

                                                                                                           Page
<S>                                                                                                        <C>
Independent Auditor's Report...............................................................................F - 1

Balance Sheets
  March 31, 2001  (unaudited) and
  December 31, 2000 and 1999...............................................................................F - 2

Statements of Operations for the
  Three Months Ended March 31, 2001 and 2000 (unaudited) and
  Years Ended December 31, 2000 and 1999...................................................................F - 4

Statement of Stockholders' Equity
   Three Months Ended March 31, 2001 and 2000 (unaudited) and
   Years Ended December 31, 2000 and 1999..................................................................F - 5

Statements of Cash Flows for the
  Three Months Ended March 31, 2001 and 2000 (unaudited) and
  Years Ended December 31, 2000 and 1999...................................................................F - 6

Notes to Financial Statements..............................................................................F - 8

</TABLE>


<PAGE>



                          INDEPENDENT AUDITOR'S REPORT


Networkland, Inc.


         We have audited the accompanying balance sheets of Networkland, Inc. as
of  December  31,  2000 and 1999,  and the  related  statements  of  operations,
stockholder's  equity and cash flows for the two years ended  December 31, 2000.
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 generally  accepted auditing
standards.  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 Networkland, Inc. as
of December  31, 2000 and 1999 and the  results of its  operations  and its cash
flows  for the two  years  then  ended in  conformity  with  generally  accepted
accounting principles.

         The accompanying  financial statements have been prepared assuming that
the Company  will  continue as a going  concern.  As  discussed in Note 1 to the
financial statements,  the Company has suffered recurring losses from operations
and has a net capital  deficiency that raise substantial doubt about its ability
to continue as a going  concern.  Management's  plans in regard to these matters
are also  described  in Note 1. The  financial  statements  do not  include  any
adjustments that might result from the outcome of this uncertainty.

                                                   Respectfully submitted


                                                   /S/ ROBISON, HILL & CO
                                                   Certified Public Accountants

Salt Lake City, Utah
June 6, 2001


                                      F - 1

<PAGE>

                                NETWORKLAND, INC.
                                 BALANCE SHEETS

<TABLE>
<CAPTION>

                                                             (Unaudited)
                                                              March 31,                   December 31,
                                                                             --------------------------------------
                                                                2001                2000                1999
                                                          -----------------  ------------------  ------------------
ASSETS
Current Assets
<S>                                                       <C>                <C>                 <C>
   Cash                                                   $         158,085  $          271,682  $          417,236
   Accounts Receivable                                              729,112             815,819           1,643,942
   Accounts Receivable - Sajedi Finance                             576,405                   -                   -
   Inventory                                                         27,067              33,687              44,463
   Other                                                                  -                   -              33,296
                                                          -----------------  ------------------  ------------------

        Total Current Assets                                      1,490,669           1,121,188           2,138,937

Property & Equipment
   Transportation Equipment                                           1,100               1,100                   -
   Furniture & Equipment                                              1,528               1,528               1,528
   Office Equipment                                                   1,069               1,069                 670
   Computer Equipment and Software                                   14,220              14,220               9,510
                                                          -----------------  ------------------  ------------------
                                                                     17,917              17,917              11,708
   Less Accumulated Depreciation                                      7,500               6,000               1,500
                                                          -----------------  ------------------  ------------------

        Net Property & Equipment                                     10,417              11,917              10,208

Other Assets
Intangibles - Goodwill, Net                                               -                   -           1,902,871
                                                          -----------------  ------------------  ------------------

        Total Assets                                      $       1,501,086  $        1,133,105  $        4,052,016
                                                          =================  ==================  ==================
</TABLE>











                                      F - 2

<PAGE>

                                NETWORKLAND, INC.
                                 BALANCE SHEETS
                                   (continued)
<TABLE>
<CAPTION>
                                                                (Unaudited)
                                                                 March 31,                   December 31,
                                                                                 -------------------------------------
                                                                   2001                2000                1999
                                                             -----------------   -----------------  ------------------
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities
<S>                                                          <C>                 <C>                <C>
   Accounts Payable                                          $         409,105   $         184,484  $          958,993
   Accrued Liabilities                                                  75,942             149,516             283,652
   Advances from Parent                                              1,931,127           1,811,124             136,725
   Current Portion Long-Term Debt                                       18,956              18,956             374,794
                                                             -----------------   -----------------  ------------------

        Total Current Liabilities                                    2,435,130           2,164,080           1,754,164
                                                             -----------------   -----------------  ------------------

Long Term and Other Liabilities
   Notes Payable - Officer                                                   -                   -              18,956
                                                             -----------------   -----------------  ------------------

        Total Long Term and Other Liabilities                                -                   -              18,956
                                                             -----------------   -----------------  ------------------

        Total Liabilities                                            2,435,130           2,164,080           1,773,120
                                                             -----------------   -----------------  ------------------

Stockholder's Equity
  Preferred Stock, Par value $1.00
    Authorized 5,000 shares,
    issued -0- shares at December 31, 2000
    and 1999 and March 31, 2001                                              -                   -                   -
  Common Stock, Par value $.01
    Authorized 10,000 shares,
    Issued 2,000 shares at December 31, 2000
    and 1999 and March 31, 2001                                             20                  20                  20
   Additional Paid in Capital                                        1,975,028           1,975,028           1,975,028
   Retained Earnings (Deficit)                                      (2,909,092)         (3,006,023)            303,848
                                                             -----------------   -----------------  ------------------

        Total Stockholder's Equity (Deficit)                          (934,044)         (1,030,975)          2,278,896
                                                             -----------------   -----------------  ------------------

        Total Liabilities and Stockholder's Equity           $       1,501,086   $       1,133,105  $        4,052,016
                                                             =================   =================  ==================
</TABLE>


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

                                      F - 3

<PAGE>

                                NETWORKLAND, INC.
                            STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>

                                                        (Unaudited)
                                                       For the three
                                                       months ended                      For the year ended
                                                         March 31,                          December 31,
                                             ---------------------------------    ---------------------------------
                                                   2001             2000               2000              1999
                                             ----------------  ---------------    ---------------  ----------------
REVENUES
<S>                                          <C>               <C>                <C>              <C>
   Sales                                     $        978,482  $     3,258,056    $     9,784,369  $      4,494,155
   Cost of Sales                                      711,650        2,637,985          9,304,903         3,620,840
                                             ----------------  ---------------    ---------------  ----------------

        Gross Margin                                  266,832          620,071            479,466           873,315

EXPENSES
   Advertising                                          1,653            1,826             32,868             5,428
   General and Administrative                         165,706          461,747          3,753,584           448,538
                                             ----------------  ---------------    ---------------  ----------------

        Total Expenses                                167,359          463,573          3,786,452           453,966

Other Income (Expense)
   Interest Income                                        955            3,530              9,509             4,866
   Interest Expense                                    (2,877)               -            (11,644)                -
                                             ----------------  ---------------    ---------------  ----------------

        Net Other Income (Loss)                        (1,922)           3,530             (2,135)            4,866
                                             ----------------  ---------------    ---------------  ----------------

Income (Loss) Before Taxes                             97,551          160,028         (3,309,121)          424,215

Income Tax Expense (Benefit)                              620           54,000                750           120,367
                                             ----------------  ---------------    ---------------  ----------------

Net Income (Loss)                            $         96,931  $       106,028    $    (3,309,871) $        303,848
                                             ================  ===============    ===============  ================

Weighted Average Shares
 Outstanding                                            2,000            2,000              2,000             2,000
                                             ================  ===============    ===============  ================

Income (Loss) Per Share                      $          48.47  $         53.02    $    (1,654.94)  $         151.93
                                             ================  ===============    ===============  ================
</TABLE>




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

                                      F - 4

<PAGE>

                                NETWORKLAND, INC.
                        STATEMENT OF STOCKHOLDERS' EQUITY
               SINCE AUGUST 19, 1999 (INCEPTION) TO MARCH 31, 2001




<TABLE>
<CAPTION>

                                                     Common Stock              Paid-In          Retained
                                                Shares         Par Value       Capital          Deficit
                                            ---------------  ------------- ---------------  ----------------
Balance at August 19, 1999
<S>                                         <C>              <C>           <C>              <C>
 (inception)                                          2,000  $          20 $     1,975,028  $              -

Net Income                                                -              -               -           303,848
                                            ---------------  ------------- ---------------  ----------------

Balance at December 31, 1999                          2,000             20       1,975,028           303,848

Net Loss                                                  -              -               -        (3,309,871)
                                            ---------------  ------------- ---------------  ----------------

Balance at December 31, 2000                          2,000             20       1,975,028        (3,006,023)

Net Income                                                -              -               -            96,931
                                            ---------------  ------------- ---------------  ----------------

Balance March 31, 2001(unaudited)                     2,000  $          20 $     1,975,028  $     (2,909,092)
                                            ===============  ============= ===============  ================



</TABLE>












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

                                      F - 5

<PAGE>

                                NETWORKLAND, INC.
                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                             (unaudited)
                                                            For the three
                                                             months ended                 For the Year Ended
                                                              March 31,                      December 31,
                                                     ----------------------------  --------------------------------
                                                         2001           2000             2000            1999
                                                     -------------  -------------  ---------------- ---------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
<S>                                                  <C>            <C>            <C>              <C>
Net Income (Loss)                                    $      96,931  $     106,028  $     (3,309,871)$       303,848
Adjustments used to reconcile net income
to net cash
provided by (used in) operating activities:
   Depreciation and amortization                             1,500         53,925         1,907,371          75,638
Changes in operating assets and liabilities:
   (Increase) Decrease in accounts receivable               86,707       (579,232)          828,123      (1,643,942)
   (Increase) Decrease in receivable-Sajedi               (576,405)             -                 -               -
   (Increase) Decrease in inventory                          6,620         (2,133)           10,776         (44,463)
   (Increase) Decrease in other current assets                   -        (74,230)           33,296         (33,296)
   Increase (Decrease) in accounts payable                 224,621       (354,243)         (774,509)        958,993
   Increase (Decrease) in accrued liabilities              (73,574)       116,528          (134,136)        283,652
   Increase (Decrease) in advances parent                  120,003        499,433         1,674,399         136,725
                                                     -------------  -------------  ---------------- ---------------
Net cash provided by operating activities                 (113,597)      (233,924)          235,449          37,155
                                                     -------------  -------------  ---------------- ---------------

CASH FLOWS FROM INVESTING
ACTIVITIES:
Acquisition of Property and Equipment                            -         (1,803)           (6,209)        (11,708)
Acquisition of intangible assets                                 -              -                 -          (1,961)
                                                     -------------  -------------  ---------------- ---------------
Net cash used by investing activities                            -         (1,803)           (6,209)        (13,669)
                                                     -------------  -------------  ---------------- ---------------

CASH FLOWS FROM FINANCING
ACTIVITIES:
Repayment of Long-Term Debt                                      -        (50,000)         (374,794)              -
Proceeds of Long-Term Debt                                       -                                -         393,750
                                                     -------------  -------------  ---------------- ---------------
Net cash used in financing activities                            -        (50,000)         (374,794)        393,750
                                                     -------------  -------------  ---------------- ---------------

Net increase in cash and cash equivalents                 (113,597)      (285,727)         (145,554)        417,236
Cash and cash equivalents
   at beginning of period                                  271,682        417,236           417,236               -
                                                     -------------  -------------  ---------------- ---------------
Cash and cash equivalents
   at end of the period                              $     158,085  $     131,509  $        271,682 $       417,236
                                                     =============  =============  ================ ===============
</TABLE>

                                      F - 6

<PAGE>

                                NETWORKLAND, INC.
                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                   (unaudited)
                                                                  For the three
                                                                  months ended               For the Year Ended
                                                                    March 31,                   December 31,
                                                         ------------------------------- --------------------------
                                                             2001             2000           2000          1999
                                                         -------------  ---------------- ------------  ------------

SUPPLEMENTAL DISCLOSURE OF
   CASH FLOW INFORMATION:
<S>                                                      <C>            <C>              <C>           <C>
Cash paid during the period for taxes                    $         620  $              - $        750  $      1,189
Cash paid during the period for interest                 $       2,877  $            914 $     11,644  $           -


SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES:

None

</TABLE>




















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

                                      F - 7

<PAGE>

                                NETWORKLAND, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited

NOTE 1 - NATURE OF OPERATIONS AND GOING CONCERN

         The accompanying  financial  statements have been prepared on the basis
of accounting principles applicable to a "going concern",  which assume that the
Company  will  continue in  operation  for at least one year and will be able to
realize  its assets  and  discharge  its  liabilities  in the  normal  course of
operations.

         Several conditions and events cast doubt about the Company's ability to
continue  as  a  "going  concern".  The  Company  has  incurred  net  losses  of
approximately  $3,000,000  for the period from  January 1, 2000 to December  31,
2000, has a liquidity  problem,  and requires  additional  financing in order to
finance its business  activities  on an ongoing  basis.  The Company is actively
pursuing  alternative  financing  through and has had  discussions  with various
third parties,  although no firm  commitments  have been  obtained.  In addition
substantially  all of the  asset and some of the  liabilities  were sold to CBQ,
Inc. (see subsequent events footnote).

         The  Company's  future  capital  requirements  will  depend on numerous
factors  including,  but  not  limited  to,  continued  market  penetration  and
profitable operations from its sales of computer hardware and software services.

         These  financial  statements do not reflect  adjustments  that would be
necessary  if the Company  were unable to continue as a "going  concern".  While
management believes that the actions already taken or planned, will mitigate the
adverse conditions and events which raise doubt about the validity of the "going
concern" assumption used in preparing these financial  statements,  there can be
no assurance that these actions will be successful.

         If the  Company  were unable to  continue  as a "going  concern",  then
substantial adjustments would be necessary to the carrying values of assets, the
reported amounts of its liabilities, the reported revenues and expenses, and the
balance sheet classifications used.

Organization and Basis of Presentation

         The Company was incorporated under the laws of the State of Virginia on
August  19,  1999.  The  Company  is  a  wholly  owned  subsidiary  of  Socrates
Technologies Corporation.

         The  unaudited  financial  statements  as of March 31, 2001 and for the
three  months  ended  March  31,  2001  and  2000  reflect,  in the  opinion  of
management,  all adjustments  (which include only normal recurring  adjustments)
necessary to fairly state the financial  position and results of operations  for
the three  months.  Operating  results for interim  periods are not  necessarily
indicative of the results which can be expected for full years.

                                      F - 8

<PAGE>

                                NETWORKLAND, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Nature of Business

         The company has no products or services as of March 31, 2001.  Prior to
March 27, 2001 the Company was in the  business of providing  computer  hardware
and software solutions.

Pervasiveness of Estimates

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  required  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.

Loss per Share

         The  reconciliations  of the numerators and  denominators  of the basic
loss per share computations are as follows:
<TABLE>
<CAPTION>
                                                                      March 31,                     December 31,
                                                            ----------------------------- --------------------------------
                                                                 2001           2000            2000             1999
                                                            --------------  ------------- -----------------  -------------
NUMERATOR
<S>                                                         <C>             <C>           <C>                <C>
Net Income (Loss) To Common Stockholder                     $       96,931  $     106,028 $      (3,309,871) $     303,848
                                                            ==============  ============= =================  =============

DENOMINATOR
Weighted Average Number of Common Shares                             2,000          2,000             2,000          2,000
                                                            ==============  ============= =================  =============

EPS
Basic & Diluted Earnings (Loss) Per Share                   $        48.47  $       53.02 $      (1,654.94)  $      101.43
                                                            ==============  ============= =================  =============

There are no other potential common shares.

</TABLE>




                                      F - 9

<PAGE>

                                NETWORKLAND, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Property and Equipment

         Property and equipment are stated at cost. Depreciation is provided for
in amounts  sufficient  to relate the cost of  depreciable  assets to operations
over their estimated service lives,  principally on a straight-line basis from 3
to 5 years.

         Upon sale or other disposition of property and equipment,  the cost and
related  accumulated  depreciation or amortization are removed from the accounts
and any gain or loss is included in the determination of income or loss.

         Expenditures  for  maintenance  and  repairs  are charged to expense as
incurred.  Major overhauls and betterments are capitalized and depreciated  over
their useful lives.

         The Company  identifies  and records  impairment  losses on  long-lived
assets such as property and  equipment  when events and  circumstances  indicate
that such assets  might be  impaired.  The  Company  considers  factors  such as
significant  changes in the regulatory or business  climate and projected future
cash flows from the  respective  asset.  Impairment  losses are  measured as the
amount by which the carrying amount of intangible asset exceeds its fair value.

Cash and Cash Equivalents

         For purposes of the statement of cash flows, the Company  considers all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.

Concentration of Credit Risk

         The  Company has no  significant  off-balance-sheet  concentrations  of
credit  risk such as foreign  exchange  contracts,  options  contracts  or other
foreign  hedging  arrangements.  The Company  maintains the majority of its cash
balances with one financial institution, in the form of demand deposits.





                                     F - 10

<PAGE>

                                NETWORKLAND, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Intangible Assets

         Intangible  assets  are valued at cost and are being  amortized  on the
straight-line  basis over a period of five  years.  The  amortization  period is
management's estimate of useful economic life of the asset.

         The Company  identifies  and records  impairment  losses on  intangible
assets  when  events  and  circumstances  indicate  that  such  assets  might be
impaired.  The Company  considers  factors  such as  significant  changes in the
regulatory  or  business  climate  and  projected  future  cash  flows  from the
respective  asset.  Impairment  losses are  measured  as the amount by which the
carrying  amount of intangible  asset  exceeds its fair value.  The goodwill has
been written off due to the sale of the majority of the assets.  (See subsequent
events)


NOTE 2 - INCOME TAXES

         As of March 31, 2001, the Company had a net operating loss carryforward
for income tax reporting purposes of approximately $3,000,000 that may be offset
against future taxable income through 2021. Current tax laws limit the amount of
loss  available to be offset  against  future  taxable income when a substantial
change in ownership  occurs.  Therefore,  the amount  available to offset future
taxable income may be limited. No tax benefit has been reported in the financial
statements,  because the Company  believes  there is a 50% or greater chance the
carryforwards will expire unused. Accordingly, the potential tax benefits of the
loss carryforwards are offset by a valuation allowance of the same amount.

NOTE 3 - EMPLOYEE BENEFIT PLAN

         The Company participates in a 401(k) retirement plan which is available
to all of its full time  employees.  For the quarter  ending  March 31, 2001 and
2000 the expense paid by the Company  attributable  to the benefit plan was $-0-
and $5,886 and for the year ended  December  31,  2000 and 1999 was  $25,031 and
$3,181 respectively.





                                     F - 11

<PAGE>

                                NETWORKLAND, INC.
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
               references to March 31, 2001 and 2000 are unaudited
                                   (Continued)

NOTE 4 - COMMITMENTS AND RENT EXPENSE

         The Company  has  entered  into lease  agreements  for various  office,
storage and warehouse facilities. For the quarter ending March 31, 2001 and 2000
the rental  payments were $9,623 and $14,344  respectively.  For the year ending
December  31,  2000  and  1999  the  rental  payments  were$51,263  and  $20,208
respectively.  Effective with the sale of the business to CBQ, Inc. on March 27,
2001 the lease obligations of Networkland,  Inc. and Technet Computer  Services,
Inc. were assumed by CBQ, Inc.

         As of March 31, 2001 all  activities of the Company have been conducted
by corporate  officers from either their homes or business  offices.  Currently,
there  are no  outstanding  debts  owed by the  company  for  the  use of  these
facilities and there are no commitments for future use of the facilities.

NOTE 5 - SUBSEQUENT EVENTS

         On March 27, 2001 Socrates Technologies  Corporation the parent company
of Networkland,  Inc. and Technet Computer Services,  Inc. entered into an asset
purchase  agreement  with CBQ, Inc. In exchange for  7,650,000  common shares of
CBQ, Inc. and a promissory  note in the amount of $700,000 plus 10% interest due
March 1, 2004,  Socrates  Technologies  Corporation  sold essentially all of the
assets and some of the  liabilities of  Networkland,  Inc. and Technet  Computer
Services,  Inc. to CBQ,  Inc. The  promissory  note is  convertible  into common
shares of CBQ, Inc. anytime after twelve months at the rate of $.75 per share.

                                     F - 12

<PAGE>


          UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

During 2001,  CBQ, Inc. (the "Company" or "CBQ")  completed a number of business
and asset acquisitions.  These unaudited pro forma condensed combined statements
of operations  are based on the December 31, 2000 and March 31, 2001  historical
consolidated financial statements of the Company and the financial statements of
EasySoft International,  Inc. ("ESI"), Technet Computer Services, Inc. (TCS) and
Networkland,  Inc.  ("NWL")  contained  elsewhere  herein,  giving effect to the
transaction under the purchase method of accounting, with the Company treated as
the acquiring entity for financial reporting  purposes.  The unaudited pro forma
condensed combined statement of operations presents the results of operations of
the Surviving  Corporation,  assuming the acquisitions were completed on January
1, 2000 (for the Year  ended  December  31,  2000) and  January 1, 2001 (for the
three months ended March 31, 2001).

ESI      - On  March 1,  2001  the  shareholders'  of ESI  entered  into a stock
         purchase agreement with CBQ. The purchase price was 5,625,000 shares of
         common stock in exchange for assets valued at $580,596  (receivables in
         the approximate amount of $95,665, equipment and other assets of $5,181
         and goodwill of $479,750)  less  liabilities of $9,305 or $0.101563 per
         share  calculated  based on the  average  closing  prices of the period
         February 22, 2001 to March 8, 2001,  the five days before and after the
         date of acquisition. ESI was based in Florida.

TCS      and NWL - On March 27, 200l the Company purchased certain assets of TCS
         and NWL  from  their  Parent,  Socrates  Technologies  Corp,  Inc.  for
         7,800,000  shares of common stock and a 10% note payable of $700,000 in
         exchange for which the Company  received  assets valued at $1,699,247 (
         receivables $1,434,389,  inventory $27,067, equipment $45,120, goodwill
         $192,671  and  other  assets  $220,080)  and  assumed   liabilities  of
         $785,198..

         The unaudited pro forma condensed  combined  financial  statements have
been  prepared by  management  of CBQ,  ESI, TCS and NWL based on the  financial
statements  included elsewhere herein. The pro forma adjustments include certain
assumptions and preliminary estimates as discussed in the accompanying notes and
are subject to change.  These pro forma  statements may not be indicative of the
results that actually would have occurred if the  combination had been in effect
on the dates  indicated or which may be obtained in the future.  These pro forma
financial  statements should be read in conjunction with the accompanying  notes
and the historical financial information of CBQ, ESI, TCS and NWL (including the
notes thereto) included in this Form. See "FINANCIAL STATEMENTS."




<PAGE>

                   UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
                                DECEMBER 31, 2000

<TABLE>
<CAPTION>

                                                                 Technet                       Acquired
                                                   EasySoft      Computer                      Entities
                                                International,   Services,     Networkland,    Combined
                                                      Inc.          Inc.           Inc.         Balance
                                                  -----------   -----------    -----------    -----------
ASSETS
<S>                                               <C>           <C>            <C>            <C>
Current Assets ................................   $   189,707   $ 1,277,803    $ 1,121,188    $ 2,588,698
Fixed Assets (net) ............................         9,317       219,353         11,917        240,587
Other Assets ..................................         2,077          --             --            2,077
                                                  -----------   -----------    -----------    -----------

     Total Assets .............................   $   201,101   $ 1,497,156    $ 1,133,105    $ 2,831,362
                                                  ===========   ===========    ===========    ===========

LIABILITIES AND STOCKHOLDERS'
EQUITY
Current Liabilities ...........................   $     6,390   $ 1,999,858    $ 2,164,080    $ 4,170,328
Long-term Debt ................................          --            --             --             --
                                                  -----------   -----------    -----------    -----------
    Total Liabilities .........................         6,390     1,999,858      2,164,080      4,170,328
                                                  -----------   -----------    -----------    -----------

Stockholders' Equity:
   Preferred Stock ............................          --            --             --             --
  Common Stock ................................         1,000            10             20          1,030
  Additional Paid in Capital ..................        13,078     2,379,990      1,975,028      4,368,096
  Accumulated Other Comprehensive Income ......         4,856          --             --            4,856
  Retained Earnings (Deficit) .................       175,777    (2,882,702)    (3,006,023)    (5,712,948)
                                                  -----------   -----------    -----------    -----------
     Total Stockholders' Equity (Deficit) .....       194,711      (502,702)    (1,030,975)    (1,338,966)
                                                  -----------   -----------    -----------    -----------

     Total Liabilities and Stockholders' Equity   $   201,101   $ 1,497,156    $ 1,133,105    $ 2,831,362
                                                  ===========   ===========    ===========    ===========
</TABLE>








See  accompanying  notes to unaudited  pro forma  condensed  combined  financial
statements.


<PAGE>

                  UNAUDITED PRO FORMA STATEMENTS OF OPERATIONS
                      FOR THE YEAR ENDED DECEMBER 31, 2000

<TABLE>
<CAPTION>

                                                       Technet                          Acquired
                                        EasySoft       Computer                         Entities
                                     International,    Services,      Networkland,      Combined
                                           Inc.           Inc.             Inc.          Balance
                                      ------------    ------------    ------------    ------------

<S>                                   <C>             <C>             <C>             <C>
Revenues: .........................   $  1,162,508    $  4,926,152    $  9,784,369    $ 15,873,029
Cost of Revenues ..................        823,624       2,225,635       9,304,903      12,354,162
                                      ------------    ------------    ------------    ------------
   Gross Profit ...................        338,884       2,700,517         479,466       3,518,867


Expenses:
   Advertising ....................          9,718            --            32,868          42,586
   General & Administrative .......        225,539       5,755,988       3,753,584       9,735,111
   Other (Income) Expense .........        174,338         113,122           2,135         289,595
                                      ------------    ------------    ------------    ------------

Net Income (Loss) Before Taxes ....        (70,711)     (3,168,593)     (3,309,121)     (6,548,425)

Income Taxes (Benefit) ............           --           161,881             750         162,631
                                      ------------    ------------    ------------    ------------


Net Income (Loss) .................   $    (70,711)   $ (3,330,474)   $ (3,309,871)   $ (6,711,056)
                                      ============    ============    ============    ============

Income (Loss) per share ...........   $      70.71    $  (3,330.47)      (1,654.94)

Weighted average shares outstanding          1,000           1,000           2,000


</TABLE>










See  accompanying  notes to unaudited  pro forma  condensed  combined  financial
statements.


<PAGE>

                  UNAUDITED PRO FORMA STATEMENTS OF OPERATIONS
                    FOR THE THREE MONTHS ENDED MARCH 31, 2001
<TABLE>
<CAPTION>


                                                     Technet                   Acquired
                                       EasySoft      Computer                  Entities
                                    International,   Services,   Networkland,  Combined
                                          Inc.          Inc.         Inc.       Balance
                                      ----------    ----------   ----------   ----------

<S>                                   <C>           <C>          <C>          <C>
Revenues: .........................   $  192,165    $1,094,990   $  978,482   $2,265,637
Cost of Revenues ..................      129,886       229,532      711,650    1,071,068
                                      ----------    ----------   ----------   ----------
   Gross Profit ...................       62,279       865,458      266,832    1,194,569


Expenses:
   Advertising ....................         --            --          1,653        1,653
   General & Administrative .......       16,327       824,950      165,706    1,006,983
   Other (Income) Expense .........         (466)       21,733        1,922       23,189
                                      ----------    ----------   ----------   ----------

Net Income (Loss) Before Taxes ....       46,418        18,775       97,551      162,744

Income Taxes (Benefit) ............         --            --            620          620
                                      ----------    ----------   ----------   ----------


Net Income (Loss) .................   $   46,418    $   18,775   $   96,931   $  162,124
                                      ==========    ==========   ==========   ==========

Income (Loss) per share ...........   $    46.42   $    18.77   $    48.47

Weighted average shares outstanding        1,000         1,000        2,000

</TABLE>











See  accompanying  notes to unaudited  pro forma  condensed  combined  financial
statements.


<PAGE>

                   UNAUDITED PRO FORMA CONDENSED BALANCE SHEET
                                DECEMBER 31, 2000
<TABLE>
<CAPTION>

                                                   CBQ, Inc.                                       Pro Forma
                                                      and         Acquired      Pro Forma           Combined
                                                 Subsidiaries     Entities     Adjustments           Balance
                                                  -----------    -----------    ----------         -----------
ASSETS
<S>                                               <C>            <C>            <C>            <C> <C>
Current Assets ................................   $ 1,451,818    $ 2,588,698    $  (103,169)   A
                                                                                 (1,716,212)   B   $ 2,221,135
Fixed Assets (net) ............................       445,743        240,587           --              686,330
Other Assets ..................................     1,027,565          2,077        479,750    A
                                                                                    192,671    B     1,702,063
                                                  -----------    -----------    -----------        -----------

     Total Assets .............................   $ 2,925,126    $ 2,831,362    $(1,146,960)       $ 4,609,528
                                                  ===========    ===========    ===========        ===========

LIABILITIES AND STOCKHOLDERS'
EQUITY
Current Liabilities ...........................   $ 3,645,798    $ 4,170,328    $(4,163,938)   B   $ 3,652,188
Long-term Debt ................................     2,338,139           --          780,000    B     3,118,139
                                                  -----------    -----------    -----------        -----------
    Total Liabilities .........................     5,983,937      4,170,328     (3,383,938)         6,770,327
                                                  -----------    -----------    -----------        -----------

Stockholders' Equity:
   Preferred Stock ............................            70           --             --                   70
  Common Stock ................................         6,984          1,030         (1,000)   A
                                                                                        563    A
                                                                                        (30)   B
                                                                                        780    B         8,327
  Additional Paid in Capital ..................     2,304,813      4,368,096        570,729    A
                                                                                    (13,078)   A
                                                                                 (4,355,018)   B
                                                                                    325,940    B     3,201,482
  Accumulated Other Comprehensive Income ......          --            4,856         (4,856)   A          --
  Retained Earnings (Deficit) .................    (5,370,678)    (5,712,948)      (175,777)   A
                                                                                  5,888,725    B    (5,370,678)
                                                  -----------    -----------    -----------        -----------
     Total Stockholders' Equity (Deficit) .....    (3,058,811)    (1,338,966)     2,236,978         (2,160,799)
                                                  -----------    -----------    -----------        -----------

     Total Liabilities and Stockholders' Equity   $ 2,925,126    $ 2,831,362    $(1,146,960)       $ 4,609,528
                                                  ===========    ===========    ===========        ===========
</TABLE>






See  accompanying  notes to unaudited  pro forma  condensed  combined  financial
statements.


<PAGE>

                  UNAUDITED PRO FORMA STATEMENTS OF OPERATIONS
                      FOR THE YEAR ENDED DECEMBER 31, 2000
<TABLE>
<CAPTION>

                                              CBQ, Inc.                                    Pro Forma
                                                 and        Acquired       Pro Forma        Combined
                                            Subsidiaries     Entities      Adjustments       Balance
                                            ------------    -----------    -----------    ------------

<S>                                         <C>             <C>            <C>            <C>
Revenues: ...............................   $  9,450,315    $15,873,029    $      --      $ 25,323,344
Cost of Revenues ........................      8,059,359     12,354,162           --        20,413,521
                                            ------------    -----------    -----------    ------------
   Gross Profit .........................      1,390,956      3,518,867           --         4,909,823


Expenses:
   Advertising ..........................           --           42,586           --            42,586
   Selling ..............................        898,797           --             --           898,797
   General & Administrative .............      2,690,410      9,735,111       (100,000)  A  12,325,521
   Other (Income) Expense ...............        228,784        289,595         70,000   B     588,379
                                            ------------    -----------    -----------    ------------

 Income (Loss) from Continuing Operations     (2,427,035)    (6,548,425)       (30,000)     (8,945,460)

Income Taxes ............................           --          162,631       (162,631)           --
                                            ------------    -----------    -----------    ------------

Net Income (Loss) from
    Continuing Operations ...............     (2,427,035)    (6,711,056)       192,631      (8,945,460)

Discontinued (Loss) Operations ..........     (1,833,325)          --             --        (1,833,325)
                                            ------------    -----------    -----------    ------------

Net Income (Loss) .......................   $ (4,260,360)   $(6,711,056)   $   192,631    $(10,778,785)
                                            ============    ===========    ===========    ============

Income (Loss) per share .................   $      (0.06)                                 $      (0.14)

Weighted average shares outstanding .....     66,696,163                                    80,121,163

</TABLE>






See  accompanying  notes to unaudited  pro forma  condensed  combined  financial
statements.



<PAGE>

                  UNAUDITED PRO FORMA STATEMENTS OF OPERATIONS
                    FOR THE THREE MONTHS ENDED MARCH 31, 2001
<TABLE>
<CAPTION>

                                              CBQ, Inc.                                    Pro Forma
                                                 and        Acquired       Pro Forma        Combined
                                            Subsidiaries     Entities      Adjustments       Balance
                                            ------------    -----------    -----------    ------------

<S>                                         <C>             <C>            <C>            <C>
Revenues: ...............................   $  1,472,491    $ 2,265,637   $       --      $  3,738,128
Cost of Revenues ........................        739,149      1,071,068           --         1,810,217
                                            ------------    -----------    -----------    ------------
   Gross Profit .........................        733,342      1,194,569           --         1,927,911


Expenses:
   Advertising ..........................           --            1,653          1,653
   Selling ..............................        171,665           --          171,665
   General & Administrative .............        558,881      1,006,983        (25,000) A    1,540,864
   Other (Income) Expense ...............         88,913         23,189         17,500  B      129,602
                                            ------------    -----------    -----------    ------------

 Income (Loss) from Continuing Operations        (86,117)       162,744          7,500          84,127

Income Taxes ............................           --              620         16,853          16,233
                                            ------------    -----------    -----------    ------------

Net Income (Loss) from
    Continuing Operations ...............        (86,117)       162,124         24,353         100,360

Discontinued Operations .................          7,009           --             --             7,009
                                            ------------    -----------    -----------    ------------

Net Income (Loss) .......................   $    (79,108)   $   162,124    $   24,353     $    107,369
                                            ============    ===========    ===========    ============

Income (Loss) per share .................   $       --                                    $       --

Weighted average shares outstanding .....     77,221,835                                    77,221,835

</TABLE>







See  accompanying  notes to unaudited  pro forma  condensed  combined  financial
statements.


<PAGE>


      NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

(1)      General

In the  mergers,  ESI,  TCS and NWL will be merged  with and into CBQ,  with the
shares  of  outstanding  ESI,  TCS  and  NWL  Common  Stock  held  by  CBQ as an
investment,  making  ESI,  TCS and  NWL all  wholly  owned  subsidiaries  of CBQ
subsequent to the Merger.  CBQ has not yet performed a detailed  evaluation  and
appraisal  of the fair market  value of the net assets sold in order to allocate
the purchase  price among the assets sold.  For purposes of preparing  these pro
forma financial statements, certain assumptions as set forth in the notes to the
pro forma  adjustments  have been made in allocating  the sales price to the net
assets sold. As such, the pro forma  adjustments  discussed below are subject to
change based on final  appraisals and  determination of the fair market value of
the assets and liabilities of ESI, TCS and NWL.

(2)      Fiscal Year Ends

         The unaudited pro forma condensed combined statements of operations for
the year ended  December 31, 2000,  and March 31, 2001 include CBQ, ESI, TCS and
NWL's operations on a common fiscal year.


(3)      Pro Forma Adjustments

         The  adjustments  to the  accompanying  unaudited  pro forma  condensed
combined balance sheet as of December 31, 2000, are described below:

         (A)  Record  merger by  issuing  5,625,000  shares  of common  stock in
exchange for assets of ESI.

         (B) Record  purchase of assets of TCS and NWL in exchange for 7,800,000
shares of common stock and $700,000 note payable.

         The  adjustments  to the  accompanying  unaudited  pro forma  condensed
combined statements of operations are described below:

         (A) Reduction of salaries from consolidation of operations.

         (B) Interest expense on notes payable.


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