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, 2003
                   -------------------------------------------

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

   For the transition period from                      to
                                  --------------------    ----------------------
                         Commission file number 0-28831
          ------------------------------------------------------------

                                    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.)

               12535 Orange Drive, Suite 163, Davie, Florida 33330
 ------------------------------------------------------------------------------
                    (Address of principal executive offices)

                                 (202) 508-6042
                            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: June 30, 2003  Approximately
500,000,000 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,  2003,  and the  related  consolidated
statements  of  operations  for the three and six months ended June 30, 2003 and
2002,  and cash flows for the six month  periods  ended June 30,  2003 and 2002.
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 accounting  principles  generally  accepted in the
United States of America.

         We have  previously  audited,  in accordance  with  auditing  standards
generally  accepted in the United States of America,  the  consolidated  balance
sheet of CBQ,  Inc. and  Subsidiaries  as of December 31, 2002,  and the related
consolidated statements of operations,  cash flows, and stockholders' equity for
the year then ended (not  presented  herein);  and in our report dated March 28,
2003, we expressed an unqualified opinion on those financial statements.  In our
opinion,  the information  set forth in the  accompanying  consolidated  balance
sheet as of December 31, 2002, is fairly stated,  in all material  respects,  in
relation to the consolidated balance sheet from which it has been derived.


<PAGE>





         Note 1 of the Company's audited consolidated financial statements as of
December 31, 2002,  and for the year then ended  discloses  that the Company has
suffered  recurring  losses from  operations  and has no  established  source of
revenue  at  December  31,  2002.  Our  auditors'  report on those  consolidated
financial  statements includes an explanatory  paragraph referring to the matter
in Note 1 of those consolidated  financial  statements and indicating that these
matters raised  substantial  doubt about the Company's  ability to continue as a
going  concern.  As  indicated  in  Note 1 of the  Company's  unaudited  interim
consolidated financial statements as of June 30, 2003, and for the three and six
months then ended,  the Company has  continued to suffer  recurring  losses from
operations and still has no established  source of revenue at June 30, 2003. The
accompanying  interim  consolidated  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
August 8, 2003


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                                (Unaudited)
                                                                                  June 30,          December 31,
                                                                                    2003                2002
                                                                             ------------------  ------------------
Assets:

<S>                                                                          <C>                 <C>
Current assets:                                                              $                -  $                -

Other non-current assets:
   Investments                                                                          274,000             274,000
                                                                             ------------------  ------------------

         Total Assets                                                        $          274,000  $          274,000
                                                                             ==================  ==================
</TABLE>































<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                                   (Continued)
<TABLE>
<CAPTION>
                                                                                (Unaudited)
                                                                                  June 30,          December 31,
                                                                                    2003                2002
                                                                             ------------------  ------------------

Liabilities and Stockholders' Deficit:
Current liabilities:
<S>                                                                          <C>                 <C>
   Accounts payable, trade                                                   $          697,696  $          693,951
   Accrued expenses                                                                     175,000             300,000
   Due to related party                                                                   1,215               1,215
   Due to shareholders                                                                  271,800             140,000
   Net liabilities of discontinued operations                                                 -           6,260,990
                                                                             ------------------  ------------------

      Total Liabilities                                                               1,145,711           7,396,156
                                                                             ------------------  ------------------

Stockholders' Deficit:
   Preferred Stock, par value $.001 per share
      Authorized  100,000,000  shares,
      70,000 shares issued and outstanding at
      June 30, 2003 and December 31, 2002                                                   309                 309
   Common Stock, par value $.0001 per share
      Authorized 500,000,000 shares,
      Issued 500,000,000 Shares at June 30, 2003
      and December 31, 2002                                                              50,000              50,000
   Additional paid-in capital                                                         4,909,032           4,909,032
   Accumulated deficit                                                               (5,831,052)        (12,081,497)
                                                                             ------------------  ------------------

     Total Stockholders' Deficit                                                       (871,711)         (7,122,156)
                                                                             ------------------  ------------------
     Total Liabilities and
       Stockholders' Deficit                                                 $          274,000  $          274,000
                                                                             ==================  ==================
</TABLE>



                 See accompanying notes and accountants' report.


<PAGE>


                           CBQ, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                     (Unaudited)                          (Unaudited)
                                            For the three months ended             For the six months ended
                                                      June 30,                              June 30,
                                         -----------------------------------  -------------------------------------
                                               2003               2002              2003                2002
                                         -----------------  ----------------  -----------------   -----------------
Continuing operations:
<S>                                      <C>                <C>               <C>                 <C>
   Revenues                              $               -  $              -  $               -   $               -

  Costs and expenses:
      General and administrative                     3,600            35,000             10,545              71,500
      Interest                                           -           108,748                  -             180,996
                                         -----------------  ----------------  -----------------   -----------------

         Net income (loss) from
           Continuing operations                    (3,600)         (143,748)           (10,545)           (252,496)

Discontinued operations:
   Income (Loss) from operations
      of discontinued operations                         -                 -                  -                   -
   Gain (Loss) on disposal of
      Quantum Group and other
       Subsidiaries                                      -                 -          6,260,990                   -
                                         -----------------  ----------------  -----------------   -----------------

    Net Income (loss) from
      discontinued operations                            -                 -          6,260,990                   -
                                         -----------------  ----------------  -----------------   -----------------

     Net Income (Loss)                   $          (3,600) $       (143,748) $       6,250,445   $        (252,496)
                                         =================  ================  =================   =================

Basic & Diluted loss per share
   Income (Loss) from continuing
        Operations                       $               -  $              -  $               -   $               -
   Income (Loss) from
        Discontinued operations                          -                 -               0.01                   -
                                         -----------------  ----------------  -----------------   -----------------

Income (Loss) per Share                  $               -  $              -  $            0.01   $               -
                                         =================  ================  =================   =================
</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,
                                                          -------------------------------------
                                                                2003                2002
                                                          -----------------  ------------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Continuing operations:
<S>                                                       <C>                <C>
   Net Income (Loss)                                      $         (10,545) $         (252,496)
Adjustments necessary to reconcile net loss
   to net cash used in operating activities:
      Increase (decrease) in accounts payable                         3,745                   -
      Increase (decrease) in accrued expenses                      (125,000)            252,496
                                                          -----------------  ------------------
  Net cash used in continuing operations                           (131,800)                  -
  Net cash used in discontinued operations                                -                   -
                                                          -----------------  ------------------

Net cash used in operating activities                              (131,800)                  -
                                                          -----------------  ------------------

CASH FLOWS FROM INVESTING
ACTIVITIES:
Increase in deposits                                                      -             (24,000)
                                                          -----------------  ------------------
Net cash provided by (used) investing activities                          -             (24,000)
                                                          -----------------  ------------------

CASH FLOWS FROM FINANCING
ACTIVITIES:
Other decreases in long-term debt                                         -                   -
Increase in payable to shareholder                                  131,800              24,000
Common stock issued for cash                                              -                   -
Common stock issued for services                                          -                   -
                                                          -----------------  ------------------
Net Cash Provided by
  Financing Activities                                              131,800              24,000
                                                          -----------------  ------------------

Net (Decrease) Increase in
  Cash and Cash Equivalents                                               -                   -
Cash and Cash Equivalents
  at Beginning of Period                                                  -                   -
                                                          -----------------  ------------------
Cash and Cash Equivalents
  at End of Period                                        $               -  $                -
                                                          =================  ==================
</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                                                $              -   $               -
  Franchise and income taxes                              $              -   $               -

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES: NONE
</TABLE>

                 See accompanying notes and accountants' report.


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002

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  $2,206,000  for the year ended  December  31,  2002 and losses of
approximately  $4,505,000  for the year ended December 31, 2001, 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 and has had discussions  with various third parties,  although no firm
commitments have been obtained.

         The  Company's  future  capital  requirements  will  depend on numerous
factors  including,  but not limited to,  continued  progress in developing  its
products,  and market  penetration  and profitable  operations from its software
development outsourcing, web development,  custom software development,  network
systems integration and management.

         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

         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.

         On November 19, 2001, the Company entered into a plan of reorganization
with  Sourcelink,   Inc.   ("Sourcelink")  whereby  the  Company  would  acquire
Sourcelink.  Sourcelink  was a  development  stage  company  that was  formed to
develop an online trading website.

Nature of Business

         The  Company  has  ceased  all  operations  except to attempt to settle
liabilities and to seek a


<PAGE>


                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (Continued)

NOTE 1 - NATURE OF OPERATIONS AND GOING CONCERN (continued)

new  business  opportunity.  Currently,  the  Company has not  determined  which
industry  to pursue  opportunities  and will not do so until  such time as those
uncertainties  presently facing the Company are resolved. The Company's previous
lines of businesses included software development outsourcing,  web development,
custom software development, network systems integration and management.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         This  summary of  accounting  policies  for CBQ,  Inc. is  presented to
assist in  understanding  the Company's  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,  2003 and for the
three and six month periods ended June 30, 2003 and 2002 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.

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.

Principles of Consolidation

         The consolidated  financial statements for the three months ended March
31, 2003 and the year ended December 31, 2002 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").

         The  results  of  subsidiaries  acquired  or sold  during  the year are
consolidated  from their effective dates of acquisition  through their effective
dates of disposition.


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (Continued)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         All  significant  intercompany  balances  and  transactions  have  been
eliminated.

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.

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.

Income (Loss) per Share

         The  reconciliations  of the numerators and  denominators  of the basic
income (loss) per share computations are as follows:
<TABLE>
<CAPTION>
                                                              Income              Shares             Per-Share
                                                           (Numerator)         (Denominator)           Amount
                                                        ------------------  -------------------  ------------------

                                                                 For the three months ended June 30, 2003
                                                        -----------------------------------------------------------
Basic Income (Loss) per Share
<S>                                                     <C>                         <C>          <C>
   Continuing operations                                $           (3,600)         500,000,000  $                -
   Discontinued operations                                               -          500,000,000                   -
                                                        ------------------  -------------------  ------------------
Income (Loss) to common shareholders                    $           (3,600)         500,000,000  $                -
                                                        ==================  ===================  ==================

                                                                 For the three months ended June 30, 2002
                                                        -----------------------------------------------------------
Basic Income (Loss) per Share

   Continuing operations                                $         (143,748)          79,516,835  $                -
   Discontinued operations                                               -           79,516,835                   -
                                                        ------------------  -------------------  ------------------
Income (Loss) to common shareholders                    $         (143,748)          79,516,835  $                -
                                                        ==================  ===================  ==================
</TABLE>





<PAGE>



                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (Continued)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
<TABLE>
<CAPTION>
                                                              Income              Shares             Per-Share
                                                           (Numerator)         (Denominator)           Amount
                                                        ------------------  -------------------  ------------------

                                                                  For the six months ended June 30, 2003
                                                        -----------------------------------------------------------
Basic Income (Loss) per Share
<S>                                                     <C>                         <C>          <C>
   Continuing operations                                $          (10,545)         500,000,000  $                -
   Discontinued operations                                       6,260,990          500,000,000                0.01
                                                        ------------------  -------------------  ------------------
Income (Loss) to common shareholders                    $        6,250,445          500,000,000  $             0.01
                                                        ==================  ===================  ==================

                                                                  For the six months ended June 30, 2002
                                                        -----------------------------------------------------------
Basic Income (Loss) per Share
   Continuing operations                                $         (252,496)          79,516,835  $                -
   Discontinued operations                                               -           79,516,835                   -
                                                        ------------------  -------------------  ------------------
Income (Loss) to common shareholders                    $         (252,496)          79,516,835  $                -
                                                        ==================  ===================  ==================
</TABLE>

         The  effect  of   outstanding   common  stock   equivalents   would  be
anti-dilutive for June 30, 2003 and 2002 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.

Reclassifications

         Certain   reclassifications  have  been  made  in  the  2002  financial
statements to conform with the 2003 presentation.

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.


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (Continued)

NOTE 4 - DUE TO SHAREHOLDERS

         Due to  shareholders at June 30, 2003 and December 31, 2002 consists of
the following:
<TABLE>
<CAPTION>
                                                                      June 30,          December 31,
                                                                        2003                2002
                                                                 ------------------- ------------------
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                                                                221,800             90,000
                                                                 ------------------- ------------------

                                                                 $           271,800 $          140,000
                                                                 =================== ==================
</TABLE>

NOTE 5 - LEASES

         As of June 30, 2003,  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 6 - PREFERRED STOCK

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

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 7 - STOCK TRANSACTIONS

         On November 19, 2001, the Company entered into a plan of reorganization
with  Sourcelink,   Inc.   ("Sourcelink")  whereby  the  Company  would  acquire
Sourcelink.  Sourcelink  was a  development  stage  company  that was  formed to
develop an online  trading  website.  On December 13, 2002,  the Company  issued
716,589  shares of Preferred  Stock as part of the  acquisition  of  Sourcelink.
These  Preferred  Shares are  convertible  to Common Shares on a 1:1,000  basis.
Subsequent to the issuance of this stock, 477,729 shares of Preferred Stock were
converted to 477,729,000 shares of Common Stock.


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (Continued)

NOTE 7 - STOCK TRANSACTIONS (continued)

         Also during 2002,  57,245,835  shares of common stock were  returned to
the Company.

NOTE 8 - CONTINGENCIES

         In September,  2001, a confession of judgement was entered  against the
Company  and several of its  subsidiaries  by the  Circuit  Court in  Annapolis,
Maryland  (Case  No.  C-2001-74735),  in favor  of  Allegiance  Capital  Limited
partnership. The confession was in the amount of $1,976,076.04, plus attorneys's
fees of $296,411.41 and  prejudgement  interest in the amount of $802.75 per day
after September 25, 2001, until the date of entry of final judgement.  This suit
was based on loans which  Quantum had  obtained  prior to being  acquired by the
Company,  all of which were guaranteed by the Company and its  subsidiaries,  as
well as several individuals. For the year ended December 31, 2002, the amount of
the  judgement  has been  included in the  financial  statements  as part of the
current portion of long-term debt and accrued expenses. During the quarter ended
March 31, 2003, the Company  abandoned all of its acquisitions  resulting in the
write-off of the above debt.

         On October 15, 2001, Anthony M. Sanders sued the Company and several of
its former  affiliates,  in the United States District Court for the District of
Maryland (Northern Division). The case number is MJG 01 CV 3062. Mr. Sanders was
a former officer, director and controlling shareholder of Quantum Technology who
transferred his interest to the Company.  The gravaman of Mr. Sanders' complaint
is that the Company  failed to redeem  preferred  shares in Quantum  held by Mr.
Sanders.    Mr.   Sanders   is   claiming   breach   of   contract,    negligent
misrepresentation,  intentional  infliction of emotional distress and securities
violations  against the Company for this failure.  Management  feels there is no
merit to Mr. Sanders'  allegations as against the Company and that the complaint
as filed is  completely  groundless.  The  Company has elected not to defend the
case insofar as the Maryland  court has no  jurisdiction  over this matter as it
pertains to the  Company and any  judgement  obtained  by Mr.  Sanders  would be
unenforceable against the Company.

NOTE 9 - DISCONTINUED OPERATIONS

         During 2001 and 2002, the Company  closed its operations  including CBQ
Networkland,  Inc., CBQ Technet Computer  Services,  Inc., and Quantum Group and
its subsidiaries.

         During  March  2003,  the  Company  abandoned  all of its  subsidiaries
resulting in a gain on disposal of discontinued operations of $6,260,990.


<PAGE>

                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (Continued)

NOTE 9 - DISCONTINUED OPERATIONS (continued)

         The assets and liabilities of the abandoned  subsidiaries  consisted of
the following:
<TABLE>
<CAPTION>
                                                                         March 30,         December 31,
                                                                           2003                2002
                                                                     -----------------  ------------------
<S>                                                                  <C>                <C>
Assets                                                               $               -  $                -

Liabilities:

   Line of credit payable                                            $         577,157  $          577,157
   Current portion of long-term debt                                         2,860,460           2,860,460
   Accrued expenses                                                            987,348             987,348
   Net liabilities of discontinued operations                                1,311,025           1,311,025
   Preferred stock of subsidiaries                                             525,000             525,000
                                                                     -----------------  ------------------
         Total liabilities                                                   6,260,990           6,260,990
                                                                     -----------------  ------------------

         Net liabilities disposed of                                 $      (6,260,990) $       (6,260,990)
                                                                     =================  ==================
</TABLE>

         Net liabilities disposed of have been recorded as a gain on disposal of
discontinued  operations as of March 31, 2003, and separately  classified in the
accompanying consolidated balance sheet at December 31, 2002.

NOTE 10 - ACQUISITIONS

         On November 19, 2001, the Company entered into a plan of reorganization
with  Sourcelink,   Inc.   ("Sourcelink")  whereby  the  Company  would  acquire
Sourcelink. On December 13, 2002, the Company issued 716,589 shares of Preferred
Stock to complete the  acquisition of  Sourcelink.  Sourcelink was a development
stage company that was formed to develop an online trading website.  The website
was never  completed.  In the  acquisition,  the Company  acquired the partially
developed website.  The acquisition was recorded in the financial  statements as
research and development expenses.

NOTE 11 - LEGAL SETTLEMENTS

         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 December 31,
2001, the company is contingently  liable in the amount of $935,275  relating to
such receivables sold with recourse.  In November,  2001 the funding source sued
the Company,  several of its  subsidiaries  and on officer of the Company in the
Superior Court of New


<PAGE>


                           CBQ, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (Continued)

NOTE 11 - LEGAL SETTLEMENTS (continued)

Jersey, Bergen County, Case No.  BER-L-9684-01,  alleging the sum of $935,275.25
was due from the defendants under the factoring  arrangement.  On April 9, 2003,
this litigation was settled, with the Company agreeing to pay $300,000 to settle
the claim.  The Company has since paid  $125,000  towards this  settlement.  The
remaining  $175,000 is recorded in the  financial  statements as part of accrued
expenses.

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:

         Beginning in late 2001 and  continuing  through  early 2002, we entered
into a series of  transactions  that we  believe  will  result  in our  resuming
business  operations,  although in a significantly  different  industry than the
traditional industries in which we have operated. Those transactions include the
following transactions:

o        The Board of Directors decided to discontinue the retail portion of the
         business.  The  Company  did not proceed  with the  development  of any
         software business in Asia. Similarly the Company decided not to operate
         any  retail  business  related  to sale or and  servicing  of  computer
         products.   The  Company  began  focusing  on   opportunities   in  the
         information   technology  industry.   These  latter  efforts  were  not
         successful and, as a result, the Company


<PAGE>



         was forced to cease all operations in the third quarter of 2002.

o        In November,  2001,  the Company  entered into a  relationship  with an
         unaffiliated  third party to assist it in dealing with the events which
         transpired  during  the  latter  half  of  2001  and to  assist  in the
         development  and  implementation  of a  viable  business  plan  for the
         Company.  These  efforts were not  successful  and,  consequently,  the
         Company ceased all operations in the third quarter of 2002.

o        As of the date of this filing, the Company had filed answers to all law
         suits to which it had a defense; however, the Company no longer has any
         funds to further defend itself;  therefore, the Company is uncertain of
         the ultimate outcome of the litigation  pending against it. The Company
         has  identified its debts,  most of which are at the subsidiary  level,
         and  is  in  the  process  of   negotiating  a  spin  off  to  existing
         shareholders  of these  subsidiaries  in return  for  stock.  This will
         eliminate a large amount and number of debts;  however, the majority in
         amount  of debt is owed to a few  large  creditors,  none of whom  have
         indicated any willingness at present to work an  accommodation  for the
         satisfaction  of this debt.  The  Company  has worked an  agreement  to
         satisfy its  obligations  to its  auditors and is now in the process of
         determining  the  appropriate  structure in which to pursue  subsequent
         business  opportunities,   although  management  seriously  doubts  the
         ability of the Company to pursue any business  opportunities until such
         time as the capital and debt  structures of the Company are  adequately
         redefined and satisfied to attract an opportunity.

o        The Company has not determined  which industry to pursue  opportunities
         and will not do so until  such  time as those  uncertainties  presently
         facing the Company are resolved.

         All of the executive  officers and directors of the Company have either
resigned or been removed from office for failure to appear at meetings as of the
date of this report,  with the  exception of Mr. Howard  Ullman,  who is now the
sole  executive  officer and a director of the  Company,  and Susan Xu, who is a
director of the Company.

         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.

         During the period  covered by this report,  we  conducted  only minimal
business  operations.  We currently  have no employees.  Certain  administrative
services  relating  to our  minimal  maintenance  operations  were  provided  by
employees of our majority shareholders.

Results of Operations

         Plan of  Operations  - The  Company  was  organized  for the purpose of
creating a corporate


<PAGE>



vehicle to seek,  investigate and, if such  investigation  warrants,  acquire an
interest in one or more  business  opportunities  presented  to it by persons or
firms who or which  desire  to seek  perceived  advantages  of a  publicly  held
corporation.

         The  Company  may  incur   significant   post-merger   or   acquisition
registration costs in the event management wishes to register a portion of their
shares for subsequent  sale. The Company will also incur  significant  legal and
accounting  costs in  connection  with the  acquisition  including  the costs of
preparing post- effective amendments,  Forms 8-K, agreements and related reports
and documents.

         The Company will not have sufficient  funds (unless it is able to raise
funds  in  a  private  placement)  to  undertake  any  significant  development,
marketing and manufacturing of the products acquired. Accordingly, following the
acquisition,  the Company  will, in all  likelihood,  be required to either seek
debt or equity  financing or obtain funding from third parties,  in exchange for
which the  Company  may be  required  to give up a  substantial  portion  of its
interest in the acquired product. There is no assurance that the Company will be
able  either to  obtain  additional  financing  or  interest  third  parties  in
providing  funding for the further  development,  marketing and manufacturing of
any products acquired.

         Results of Operations - The Company had no  operations  during 2002 and
to the date of this  report,  other than its search for a business  opportunity.
During 2001 and 2000 the Company attempted to provide retail software,  computer
services and products that has since proved uneconomical and has been abandoned.
Accordingly, comparisons with prior periods are not meaningful.

         During the quarter ended March 31, 2003,  the Company  abandoned all of
its subsidiaries  resulting in a gain on disposal of discontinued  operations of
$6,260,990.

Capital Resources and Liquidity

         The  Company  has not  generated  any  cash  flows  from  operating  or
investing  activities since inception.  Operating capital was primarily provided
from the proceeds of equity financing, bank loans and receivables financing, the
latter two of which the Company is presently no longer  entitled to enjoy and is
in litigation over. CBQI is presently seeking alternative sources of capital.

         The Company  expects future  development and expansion will be financed
through cash flow from  operations and other forms of financing such as the sale
of  additional  equity and debt  securities,  capital  leases  and other  credit
facilities.  There are no assurances  that such  financing  will be available on
terms acceptable or favorable to the Company.

Item 3.  Controls and Procedures

         The Company's Chief Executive  Officer and Chief Financial Officer have
concluded,  based on an evaluation  conducted within 90 days prior to the filing
date of this  Quarterly  Report on Form 10-QSB,  that the  Company's  disclosure
controls and  procedures  have  functioned  effectively  so as to provide  those
officers the information necessary to evaluate whether:


<PAGE>



         (i) this Quarterly  Report on Form 10-QSB contains any untrue statement
         of a material fact or omits to state a material fact  necessary to make
         the  statements  made, in light of the  circumstances  under which such
         statements were made, not misleading with respect to the period covered
         by this Quarterly Report on Form 10-QSB, and

         (ii) the financial statements, and other financial information included
         in this Quarterly Report on Form 10-QSB, fairly present in all material
         respects the financial condition,  results of operations and cash flows
         of the Company as of, and for, the periods  presented in this Quarterly
         Report on Form 10-QSB.

         There  have  been no  significant  changes  in the  Company's  internal
controls or in other factors since the date of the Chief Executive Officer's and
Chief  Financial  Officer's  evaluation  that could  significantly  affect these
internal  controls,  including any corrective actions with regard to significant
deficiencies and material weaknesses.

                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         The Company is presently a party to several law suits. The material law
suits are:

         Allegiance Capital:  In September,  2001, a confession of judgement was
entered  against  CBQI and  several  of its  subsidiaries  by  Circuit  Court in
Annapolis,  Maryland (Case No. C-2001-  74735),  in favor of Allegiance  Capital
Limited  Partnership.  The confession was in the amount of  $1,976,076.04,  plus
attorneys's  fees of  $296,411.41  and pre  judgement  interest in the amount of
$802.75  per day  after  September  25,  2001,  until the date of entry of final
judgement.  This suit was based on loans  which  Quantum had  obtained  prior to
being  acquired  by  CBQI,  all  of  which  were  guaranteed  by  CBQI  and  its
subsidiaries, as well as several individuals,  including John Moran, Gino Manna,
Raymond   Kostkowski,   Anne  Sigman  and  J.  Patrick  Dowd.   Pursuant  to  an
Inter-Creditor   Agreement   between  Suntrust  Bank  and  Allegiance   Capital,
Allegiance  Capital's claims are subordinate to such claims as Suntrust Bank may
have against CBQ, Inc.

         Platinum Funding: In November,  2001, Platinum Funding Corp. (Platinum)
sued CBQI,  several of its  subsidiaries,  and Mr. Bart  Fisher in the  Superior
Court of New Jersey,  Bergen County, Case No.  BER-L-9684-01,  alleging that the
sum of  $935,275.25  was due from the defendants  under a factoring  arrangement
which Platinum  claims to have existed.  On April 9, 2003,  this  litigation was
settled,  with the  Company  agreeing to pay  $300,000 to settle the claim.  The
Company has since paid $125,000 towards this settlement.  The remaining $175,000
is recorded in the financial statements as part of accrued expenses.

         Anthony M. Sanders:  On October 15, 2001,  Anthony M. Sanders sued CBQ,
Inc., and several of its former affiliates, including Raymond Kostkowski, in the
United States District Court for the District of Maryland  (Northern  Division).
The case number is MJG 01 CV 3062.  Mr. Sanders was a former  officer,  director
and controlling  shareholder of Quantum  Technology who transferred his interest
to CBQI. Mr. Sanders' complaint is that CBQI failed to redeem preferred


<PAGE>



shares in  Quantum  held by Mr.  Sanders.  Mr.  Sanders  is  claiming  breach of
contract,  negligent  misrepresentation,  intentional  infliction  of  emotional
distress and  securities  violations  against CBQI for this failure.  Management
feels there is no merit to Mr. Sanders' allegations as against CBQI and that the
complaint as filed is completely groundless.  CBQI has elected not to defend the
case insofar as the Maryland  court has no  jurisdiction  over this matter as it
pertains  to  CBQI  and  any  judgement   obtained  by  Mr.   Sanders  would  be
unenforceable against CBQI.

         Suntrust Bank line of credit and term note:  Quantum  Technology  Group
had a $4  million  line of credit  with  Crestar  Bank,  which was  subsequently
acquired by  Suntrust.  This line of credit was  guaranteed  by Quantum and five
individual  guarantors,  including Ray Kostkowski,  Anne Sigman, Skip Lewis, and
Anthony Saunders.  This line of credit was opened during April,  2000. On August
8, 2000,  CBQI  acquired  all of the shares of Quantum  Technology  Group.  $1.3
million of the line of credit  had been  used,  and was owing to the bank and in
addition  to  the  line  of  credit,   a  $200,000  term  loan  from   Suntrust,
approximately  $200,000 in accrued interest and $100,000 in attorney fees all of
which Suntrust is attempting to collect from the individual guarantors. Suntrust
has not sued CBQI but has  threatened to sue. It is the position of CBQI that it
does not owe the money to  Suntrust.  It never  signed  any loan,  and indeed by
freezing the line of credit, Suntrust greatly injured the business of CBQI.

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

(a) EXHIBITS

31       Certification  Pursuant  to Section 302 of the  Sarbanes-  Oxley Act of
         2002.

32       Certification  Pursuant  to Section 906 of the  Sarbanes-  Oxley Act of
         2002.

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


<PAGE>



                                   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 6th day of June, 2003.

CBQ, Inc.

Date: August 18, 2003

/s/ Howard Ullman
Howard Ullman
President and Director
(Principal Executive Officer)
(Principal Financial and Accounting Officer)