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: March 31, 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:  May 8, 2001  Approximately
77,866,212 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 March 31,  2001 and  December  31, 2000 and the related
consolidated statements of operations and cash flows for the three month periods
ended March 31, 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
May 15, 2001







<PAGE>
                           CBQ, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS


                                                  (Unaudited)
                                                    March 31,       December 31,
                                                       2001             2000
                                                   -----------      -----------
Assets:

Current assets:
   Cash ......................................     $   543,823      $   147,873
   Accounts receivable, net of
     allowance for doubtful accounts .........         909,092        1,042,248
   Inventories ...............................          86,711           75,420
   Other current assets ......................         194,721          186,277
                                                   -----------      -----------

      Total current assets ...................       1,734,347        1,451,818
                                                   -----------      -----------

Equipment:
   Computers and related equipment ...........         540,144          537,890
   Office equipment ..........................         356,514          355,664
   Software ..................................          34,927           34,927
   Transportation equipment ..................          47,078           47,078
   Leasehold improvements ....................          18,611           18,611
                                                   -----------      -----------
                                                       997,274          994,170
      Less accumulated depreciation ..........        (580,935)        (548,427)
                                                   -----------      -----------

         Equipment, net of
           accumulated depreciation ..........         416,339          445,743
                                                   -----------      -----------

Other non-current assets:
   Notes receivable, long-term ...............          60,452           60,452
   Goodwill, less amortization ...............       1,262,776          844,951
   Investments ...............................          46,163           46,163
   Other assets ..............................       1,300,144           75,999
                                                   -----------      -----------

      Total other non-current assets .........       2,669,535        1,027,565
                                                   -----------      -----------

         Total assets ........................     $ 4,820,221      $ 2,925,126
                                                   ===========      ===========











<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                   (Continued)

                                                     (Unaudited)
                                                       March31,     December 31,
                                                         2001           2000
                                                     -----------    -----------
Liabilities and Stockholders' Deficit:

Current liabilities:
   Line of credit payable ........................   $ 1,312,157    $ 1,312,157
   Current portion of long-term debt .............        74,840         87,908
   Accounts payable, trade .......................     1,497,515      1,780,927
   Accrued expenses ..............................       610,522        348,591
   Due to related party ..........................         1,215          1,215
   Due to shareholders ...........................       115,000        115,000
                                                     -----------    -----------

      Total current liabilities ..................     3,611,249      3,645,797
                                                     -----------    -----------

Non-current liabilities:
   Long-term debt ................................     2,510,775      1,813,139
   Preferred stock of subsidiaries ...............       525,000        525,000
                                                     -----------    -----------

      Total non-current liabilities ..............     3,035,775      2,338,139

         Total Liabilities .......................     6,647,024      5,983,938
                                                     -----------    -----------

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

   Common Stock, par value $.0001 per share
      Authorized 500,000,000 shares,
      Issued 77,221,835 Shares at March 31, 2001
      and 69,836,835 shares at December 31, 2000 .         7,723          6,984
   Additional paid-in capital ....................     3,615,191      2,304,813
   Accumulated deficit ...........................    (5,449,787)    (5,370,678)
                                                     -----------    -----------

     Total Stockholders' Deficit .................    (1,826,803)    (3,058,811)
                                                     -----------    -----------

     Total Liabilities and
       Stockholders' Deficit .....................   $ 4,820,221    $ 2,925,126
                                                     ===========    ===========

                 See accompanying notes and accountants' report.

<PAGE>
                           CBQ, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS





                                                           (Unaudited)
                                                    For the three months ended
                                                             March 31,
                                                  -----------------------------
                                                      2001              2000
                                                  -----------       -----------
Continuing operations:

   Revenues ................................      $ 1,472,491       $ 2,992,199

  Costs and expenses:
      Cost of revenues .....................          739,149         2,006,076
      Sales and marketing ..................          171,665            22,402
      General and administrative ...........          464,449           215,895
      Depreciation and amortization ........           94,432             2,406
      Interest, net ........................           88,913             6,802
                                                  -----------       -----------

         Total costs and expenses ..........        1,558,609         2,253,581
                                                  -----------       -----------

         Net income (loss) from
           continuing operations ...........          (86,118)          738,618

Discontinued operations:

   Income (Loss) from operations of
      discontinued operations ..............            7,009          (325,630)

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

    Net Income (loss) from
      discontinued operations ..............            7,009          (325,630)
                                                  -----------       -----------

     Net Income (Loss) .....................      $   (79,109)      $   412,988
                                                  ===========       ===========

Basic & Diluted loss per share .............      $      --         $      --
                                                  ===========       ===========




                 See accompanying notes and accountants' report.

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


                                                              (Unaudited)
                                                      For the three months ended
                                                               March 31,
                                                         ----------------------
                                                           2001         2000
                                                         ---------    ---------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Continuing operations:
   Net Income (Loss) .................................   $ (79,109)   $ 412,988
Adjustments necessary to reconcile net loss
   to net cash used in operating activities:
      Depreciation and amortization ..................      94,434        2,406
      Decrease (increase) in accounts receivable .....     224,698     (672,453)
      Decrease (increase) in inventories .............     (11,291)      46,533
      Decrease (increase) in other current assets ....      (8,444)      (4,068)
      Decrease (increase) in other assets ............         680        7,786
      Increase (decrease) in accounts payable ........    (283,412)      10,671
      Increase (decrease) in accrued expenses ........     261,932      (64,230)
                                                         ---------    ---------
  Net Cash Used in continuing operations .............     278,597     (673,355)
                                                         ---------    ---------

Cash flows from discontinued operations ..............     199,487     (260,367)
                                                         ---------    ---------

CASH FLOWS FROM INVESTING
ACTIVITIES:
Acquisition of equipment .............................      (3,105)     (56,683)
                                                         ---------    ---------
Net cash provided by (used) investing activities .....      (3,105)     (56,683)
                                                         ---------    ---------

CASH FLOWS FROM FINANCING
ACTIVITIES:
Issuance of preferred stock of subsidiary ............        --        275,000
Other decreases in long-term debt ....................     (15,432)    (127,482)
Repayment of notes payable to shareholder ............        --        (59,817)
Common stock issued for cash .........................     215,000      251,083
Common stock issued for services .....................        --        112,625
                                                         ---------    ---------
Net Cash Provided by
  Financing Activities ...............................     199,568      451,409
                                                         ---------    ---------

Net (Decrease) Increase in
  Cash and Cash Equivalents ..........................     395,950      134,359
Cash and Cash Equivalents
  at Beginning of Period .............................     147,873     (118,184)
                                                         ---------    ---------
Cash and Cash Equivalents
  at End of Period ...................................   $ 543,823    $  16,175
                                                         =========    =========



<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                    Continued



SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest .....................................          $37,418          $ 8,350
Franchise and income taxes ...................          $  --            $  --

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 7,650,000 shares of common stock and a
10% note payable of $700,000 in exchange for which the Company  received  assets
valued at  $1,930,023 ( receivables  $1,534,147,  inventory  $27,067,  equipment
$45,120, goodwill $103,609 and other assets $220,080) and assumed liabilities of
$705,198.

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


















                 See accompanying notes and accountants' report.


<PAGE>
                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 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 March 31, 2001 and for the three
month  periods  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.

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 March 31,
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 MONTHS ENDED MARCH 31, 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 MONTHS ENDED MARCH 31, 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:


                                                                      Per-Share
                                             Income      Shares        Amount
                                             ------      ------        ------
                                           (Numerator)(Denominator)

                                       For the three months ended March 31, 2001
                                          -------------------------------------
Basic Loss per Share
Loss to common shareholders               $   (79,109)  72,287,946  $      --
                                          ===========  ===========  ===========

                                       For the three months ended March 31, 2000
                                          -------------------------------------
Basic Loss per Share
Income to common shareholders             $   412,988   63,263,708  $      --
                                          ===========  ===========  ===========

     The effect of outstanding  common stock  equivalents would be anti-dilutive
for March 31, 2001 and 2000 and are thus not considered.

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

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.


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000
               --------------------------------------------------
                                   (Continued)

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

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.

Reclassifications

     Certain  reclassifications  have been made in the March 31, 2000  financial
statements to conform with the March 31, 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.

     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.



<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000
               --------------------------------------------------
                                   (Continued)

NOTE 2 - ACQUISITIONS Continued

     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 Computers
Services, Inc. and Networkland, Inc. for 7,650,000 shares of voting common stock
and a 10% note  payable of $700,000 due in  quarterly  installments  of interest
only until the  principal is paid in full.  The company may prepay the principal
amount in whole or in part at any time. At any time after twelve months from the
date of the note, the outstanding  principal balance and any unpaid interest may
be converted in whole at the option of the holder in common stock of the company
at a conversion  price of $0.75 per share.  All  outstanding  principal  and any
accrued and unpaid interest is due March 1, 2004.




<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 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 a $1,312,157 line of credit payable to a bank at December
31, 2000 under a $4,000,000  revolving line of credit agreement with interest at
the bank's  prime rate or LIBOR plus 2.5%  (9.279% at December  31,  2000),  and
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 March 31,  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.  As of the May 8,  2001,  the  bank  has not  waived  the
covenant violations.

NOTE 5 - DUE TO SHAREHOLDERS

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


                                                          March 31, December 31,
                                                             2001         2000
                                                           --------     --------

Demand note payable, unsecured, with interest at
 15%, payable monthly.  Principal and
  accrued interest due on this note payable are
  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
                                                           ========     ========





<PAGE>
                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000
               --------------------------------------------------
                                   (Continued)

NOTE 6 - LONG-TERM DEBT

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


                                                          March 31, December 31,
                                                            2001         2000
                                                         ----------   ----------

Note payable, bank, with interest at 8.66%,
  payable in monthly installments of principal
  of $5,555 plus interest through April 30, 2003 .....   $  153,228   $  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 ........       32,387       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         --
                                                         ----------   ----------

                                                          2,585,615    1,901,047

      Less amounts due within one year ...............       74,840       87,908
                                                         ----------   ----------

                                                         $2,510,775   $1,813,139
                                                         ==========   ==========

<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000
               --------------------------------------------------
                                   (Continued)

NOTE 6 - LONG-TERM DEBT continued

                       The following are maturities of long-term debt:

                                                                  Period Ending
                                                                  March 31, 2001
                                                                  --------------

                                                2001                  $   74,840
                                                2002                     298,185
                                                2003                     972,590
                                                2004                     240,000
                                                2005                     740,000
                                                2006                     260,000
                                                                      ----------

                                                                      $2,585,615
                                                                      ==========

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:

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

                                   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
                                           =========     =========    =========
<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 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

     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 MONTHS ENDED MARCH 31, 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 years ended December 31,
2000 and 1999:
<TABLE>
<CAPTION>


                                                              Year Ended December 31,
                                     --------------------------------------------------------------------------
                                                    2001                                  2000
                                     -----------------------------------  -------------------------------------
                                                           Exercise                               Exercise
                                         Shares          Price/Share            Shares           Price/Share
                                     ---------------  ------------------  ------------------  -----------------
Options outstanding,
<S>                                  <C>              <C>                 <C>                 <C>
  Beginning of year:                       5,545,471          -                            -          -
Options granted                            3,050,000     $1.00-$2.125              5,545,471       $2.125
Options exercised                           (662,263)       $2.125                         -          -
Options canceled                            (217,500)       $2.125                         -          -
                                     ---------------                      ------------------
   Options outstanding,
         End of year:                      7,715,708     $1.00-$2.125              5,545,471       $2.125

Options granted                            7,725,000     $0.25-$2.125                      -          -
Options exercised                                  -          -                            -          -
Options canceled                                   -          -                            -          -
                                     ---------------                      ------------------
Options outstanding,
       March 31, 2001 and 2000            15,440,708     $0.25-$2.125              5,545,471       $2.125
                                     ===============                      ==================
</TABLE>

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

NOTE 13 - GOING CONCERN

     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.  In 2000  EasySoft,
Technet and Networkland accounted for over $15 million in gross



<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND 2000
               --------------------------------------------------
                                   (Continued)

NOTE 13 - GOING CONCERN continued

revenues.  The larger nature of the enterprise  should improve the prospects for
profitability  in  2001.  Continuation  of the  Company  as a going  concern  is
dependent  upon  obtaining  the  additional  working  capital  necessary  to  be
successful  in its  planned  activity,  and the  management  of the  Company has
developed a strategy,  which it believes will accomplish this objective  through
additional equity funding and long-term financing, which will enable the Company
to operate for the coming year.





















<PAGE>



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.

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.




<PAGE>



Results of Operations

     The Company merged with ChinaSoft,  Inc.  ("ChinaSoft") in January 2000 and
with Quantum  Technology Group,  Inc. and its subsidiaries  ("Quantum Group") in
August 2000.  Both of these  business  combinations  were treated as poolings of
interests.  Accordingly,  the Company's  consolidated operating results and cash
flows have been restated for all periods presented to reflect these mergers.

     Quantum Group acquired  Quantum  Technology  Distribution,  Inc.  ("Quantum
Distribution") on November 15, 1999 and dpi Net Solutions, Inc. ("DPI") on April
1, 2000.  Both of these  acquisitions  were made prior to Quantum Group's merger
with  the  Company,  and  both  business  combinations  were  accounted  for  as
purchases.  Accordingly,  the consolidated  results of operations and cash flows
include  the  operations  of  Quantum  Distribution  and  DPI  only  from  their
respective dates of acquisition.

Continuing Operations:
Three Months Ended March 31, 2001 and 2000


     Revenues decreased by $1,519,708 from the quarter ended March 31, 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 $1,266,927 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 $149,263  from 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 increase in general and  administrative  expenses of $248,554 from 2000
reflects the company's  on-going pursuit of new acquisitions and  merger-related
expenses  including legal,  accounting,  consulting as well as integration costs
for its most recent  acquisitions  from  Technet,  Inc.,  Networkland,  Inc. and
EasySoft International, Inc.

     Depreciation and amortization  expenses  increased $92,026 from 2000. These
increases reflect the equipment  purchased as a result of the acquisition of DPI
in April  2000 as well as  related  goodwill  amortization  as a  result  of the
company's acquisitions.

     Interest expense  increased $82,111 from 2000 as a result of long-term debt
financing and use of the Company's  line of credit  facility  which was put into
place in April 2000.



<PAGE>



     The Company recorded a net loss of $79,109 for the three months ended March
31, 2001  compared to net income of  $412,988  for the same period in 2000.  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 during 2000 was primarily  generated by issuance of common stock,
stockholder loans and issuance of long-term debt.

     At March 31, 2001,  the Company had total current  assets of $1,734,000 and
total  assets of  $4,820,000  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 $1,877,000 and $2,194,000 at March 31, 2001 and December 31,
2000.

     Net  stockholders'  deficit in the Company was $2,042,000 and $3,059,000 as
of March 31, 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

None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K



<PAGE>


     (a)  EXHIBITS



     (b)  Reports  on Form 8-K.  No  reports  on Form 8-K were file  during  the
          period covered by this Form 10-QSB.

                                   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 12th day of May, 2001.

CBQ, Inc.


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



/s/ Leann Zawodniak
Leann Zawodniak
Chief Financial Officer


May 15, 2001