**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**














**FORM
      10-QSB**








**[X]
      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE**


**SECURITIES
      EXCHANGE ACT OF 1934**





For
      the
      Quarterly Period ended: September 30, 2005





OR





**[
      ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE**


**SECURITIES
      EXCHANGE ACT OF 1934**





For
      the
      transition period from ________ to ________




Commission
        File No.: 000-51285
 
  **a21,
        INC.**
 (Name
        of
        Small Business Issuer in its Charter)
  TEXAS
              
              74-2896910(State
                  or Other Jurisdiction of
              
              (I.R.S.
                  EmployerIncorporation
                  or Organization)
              
              Identification
                  Number)


**7660
      CENTURION PARKWAY, JACKSONVILLE, FLORIDA 32256**


(Principal
      Executive Office)





Issuer's
      telephone number, including area code: (904) 565-0066





**SECURITIES
      REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NONE**





**SECURITIES
      REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: Common stock, par value $0.001
      per share**





Check
      whether the Issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Securities Exchange Act of 1934 during the past 12 months (or
      for
      such shorter period that the registrant was required to file such reports),
      and
      (2) has been subject to such filing requirements for the past 90 days. Yes
      [X]
      No [ ]





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act). Yes [ ] No [X]





There
      were 70,435,237
      shares of the Company's common stock outstanding on November 25, 2005.




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















**TABLE
                OF CONTENTS**PagePART
                I - FINANCIAL INFORMATIONITEM
                1. FINANCIAL STATEMENTSCondensed
                Consolidated Balance Sheets at September 30, 2005 andDecember
                31, 2004
            
            1Condensed
                Consolidated Statements of Operations for the three months
                and nine
                months
              ended
                September 30, 2005 and 2004
            
            3Condensed
                Consolidated Statements of Cash Flows for the nine months
                ended
              September
                30, 2005 and 2004
            
            4Condensed
                Consolidated Statements of Changes in Stockholders’ Equity (Capital
              Deficit)
                for the nine months ended September 30, 2005
            
            6Notes
                to Condensed Consolidated Financial Statements
            
            7ITEM
                2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                AND
              RESULTS
                OF OPERATIONS
            
            24ITEM
                3. CONTROLS AND PROCEDURES
            
            28PART
                II - OTHER INFORMATIONITEM
                1. LEGAL PROCEEDINGS
            
            29ITEM
                2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
                PROCEEDS
            
            29ITEM
                3. DEFAULTS UPON SENIOR SECURITIES
            
            30ITEM
                4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
            
            30ITEM
                5. OTHER INFORMATION
            
            30ITEM
                6. EXHIBITS
            
            30











**a21,
        Inc. and Subsidiaries**
 **CONDENSED
        CONSOLIDATED BALANCE SHEETS**
 **(Unaudited)**
 **($
        in thousands)**





**September
                30,**
            
            **December
                31,****2005**
            
            **2004**ASSETSCURRENT
                ASSETSCash
                and cash equivalents
            
            $
            1,157
            
            $
            717Accounts
                receivable, net
            
            
            1,286
            
            
            1,302Inventory
            
            
            96
            
            
            ---Prepaid
                expenses and other current assets
            
            
            219
            
            
            200Income
                tax receivable
            
            
            ---
            
            
            108Total
                current assets
            
            
            2,758
            
            
            2,327Land
                and building, net
            
            
            7,256
            
            
            7,329Photo
                collection, net
            
            
            1,839
            
            
            2,198Property
                and equipment, net
            
            
            411
            
            
            547Goodwill
            
            
            1,049
            
            
            1,049Contracts
                with photographers, net
            
            
            980
            
            
            1,133Long-term
                accounts receivable
            
            
            508
            
            
            160Long-term
                notes receivable
            
            
            15
            
            
            18Intangible
                assets, net
            
            
            74
            
            
            92Other
                long-term assets
            
            
            101
            
            
            101Restricted
                cash
            
            
            669
            
            
            600Total
                assets
            
            $
            15,660
            
            $
            15,554LIABILITIES
                AND STOCKHOLDERS' EQUITY (CAPITAL DEFICIT)CURRENT
                LIABILITIESCurrent
                portion of notes payable
            
            $
            1,078
            
            $
            ---Accounts
                payable
            
            
            901
            
            
            872Accrued
                wages and payroll taxes
            
            
            116
            
            
            147Accrued
                interest, current
            
            
            269
            
            
            187Accrued
                purchase price payable
            
            
            306
            
            
            201Current
                portion of promissory note payable
            
            
            33
            
            
            32Royalties
                payable
            
            
            1,083
            
            
            979Total
                current liabilities
            
            
            3,786
            
            
            2,418LONG-TERM
                LIABILITIESPromissory
                note payable, long-term portion
            
            
            33
            
            
            67Other
                long-term liabilities
            
            
            62
            
            
            61Loan
                payable
            
            
            7,480
            
            
            7,458Convertible
                subordinated notes payable, net
            
            
            ---
            
            
            520Senior
                secured notes payable, net
            
            
            2,291
            
            
            ---Unsecured
                notes payable to others, net
            
            
            ---
            
            
            1,040Total
                liabilities
            
            
            13,652
            
            
            11,564The
                accompanying notes are an integral part of these Condensed Consolidated
                Financial Statements.





-
          1
          -


**a21,
      Inc. and Subsidiaries**


**CONDENSED
      CONSOLIDATED BALANCE SHEETS (Cont’)**


**(Unaudited)**


($
        in thousands)





**September
                  30,**
              
              **December
                  31,****2005**
              
              **2004**COMMITMENTS
                  AND CONTINGENCIESMINORITY
                  INTEREST
              
              
              2,800
              
              
              2,800STOCKHOLDERS'
                  EQUITY (CAPITAL DEFICIT)Preferred
                    stock; $.001 par value; 100,000 shares authorized; no shares
                    issued and
                    outstanding
              
              
              ---
              
              
              ---Common
                  stock; $.001 par value; 100,000,000 shares authorized; 53,006,012
                  and
                  41,816,012 shares issued at September 30, 2005 and December 31,
                  2004,
                  respectively, and 49,326,237 and 38,136,237 shares outstanding
                  at
                  September 30, 2005 and December 31, 2004, respectively
              
              
              53
              
              
              42Treasury
                  stock (at cost, 3,679,775 shares)
              
              
              ---
              
              
              ---Additional
                  paid-in capital
              
              
              11,990
              
              
              10,599Deferred
                  compensation
              
              
              (189
              )
              
              ---Accumulated
                  deficit
              
              
              (12,721
              )
              
              (9,411
              )Accumulated
                  comprehensive income/(loss)
              
              
              75
              
              
              (40
              )Total
                  stockholders' equity (capital deficit)
              
              
              (792
              )
              
              1,190Total
                  liabilities and stockholders' equity (capital deficit)
              
              $
              15,660
              
              $
              15,554
  The
                  accompanying notes are an integral part of these Condensed Consolidated
                  Financial Statements.








-
          2
          -





**a21,
        Inc. and Subsidiaries**
 **CONDENSED
        CONSOLIDATED STATEMENTS OF OPERATIONS**
 **(Unaudited)**
 **($
        in thousands)**







**Three
                Months Ended**
            
            **Nine
                Months Ended****September
                30,**
            
            **September
                30,****2005**
            
            **2004**
            
            **2005**
            
            **2004**REVENUE
            
            $
            2,064
            
            $
            2,077
            
            $
            6,703
            
            $
            5,402COST
                OF REVENUE
            
            
            669
            
            
            610
            
            
            2,097
            
            
            1,597GROSS
                PROFIT
            
            
            1,395
            
            
            1,467
            
            
            4,606
            
            
            3,805EXPENSESSelling,
                general and administrative
            
            
            1,997
            
            
            1,907
            
            
            5,517
            
            
            4,305Depreciation
                and amortization
            
            
            363
            
            
            251
            
            
            1,075
            
            
            675TOTAL
                OPERATING EXPENSES
            
            
            2,360
            
            
            2,158
            
            
            6,592
            
            
            4,980OPERATING
                LOSS
            
            
            (965
            )
            
            (691
            )
            
            (1,986
            )
            
            (1,175
            )Interest
                expense, net
            
            
            (316
            )
            
            (522
            )
            
            (1,045
            )
            
            (1,041
            )Other
                income/(expense), net
            
            
            (62
            )
            
            (113
            )
            
            (279
            )
            
            (61
            )NET
                LOSS BEFORE INCOME TAX BENEFIT
            
            
            (1,343
            )
            
            (1,326
            )
            
            (3,310
            )
            
            (2,277
            )Income
                tax benefit
            
            
            ---
            
            
            280
            
            
            ---
            
            
            280NET
                LOSS
            
            
            (1,343
            )
            
            (1,046
            )
            
            (3,310
            )
            
            (1,997
            )COMPREHENSIVE
                LOSSForeign
                currency translation adjustment
            
            
            19
            
            
            4
            
            
            115
            
            
            22TOTAL
                COMPREHENSIVE LOSS
            
            $
            (1,324
            )
            $
            (1,042
            )
            $
            (3,195
            )
            $
            (1,975
            )NET
                LOSS PER SHARE, BASIC AND DILUTED
            
            $
            (0.03
            )
            $
            (0.03
            )
            $
            (0.08
            )
            $
            (0.06
            )WEIGHTED
                AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC AND
                DILUTED
            
            
            41,874,607
            
            
            38,115,732
            
            
            41,752,336
            
            
            34,000,866The
                accompanying notes are an integral part of these Condensed Consolidated
                Financial Statements.







-
          3
          -


**a21,
        Inc. and Subsidiaries**
 **CONDENSED
        CONSOLIDATED STATEMENTS OF CASH FLOW**
 **(Unaudited)**
 **($
        in thousands)**





**Nine
                Months Ended****September
                30,****2005**
            
            **2004**CASH
                FLOWS FROM OPERATING ACTIVITIES:Net
                loss
            
            $
            (3,310
            )
            $
            (1,997
            )Adjustments
                to reconcile net loss to net cash used in operating
                activities:Depreciation
                and amortization
            
            
            1,075
            
            
            675Loss
                from disposal of property and equipment
            
            
            16
            
            
            ---Amortization
                of finance costs
            
            
            41
            
            
            ---Compensation
                from the prior issuance of variable options
            
            
            28
            
            
            161Compensation
                from the issuance of options and warrants
            
            
            35
            
            
            48Compensation
                from the issuance of restricted stock
            
            
            397
            
            
            21Amortization
                of debt discount related to unsecured notes payable to
                others
            
            
            10
            
            
            251Amortization
                of debt discount related to convertible subordinated notes
                payable
            
            
            96
            
            
            364Loss
                on extinguishment of debt due to beneficial conversion
                features
            
            
            371
            
            
            ---Deferred
                compensation
            
            
            (189
            )
            
            ---Deferred
                income taxes, net
            
            
            ---
            
            
            (385
            )Other
                changes in long-term assets and liabilities
            
            
            (15
            )
            
            (1
            )Changes
                in:Accounts
                receivable
            
            
            (331
            )
            
            (99
            )Inventory
            
            
            (96
            )
            
            ---Prepaid
                expenses and other current assets
            
            
            70
            
            
            5Other
                assets
            
            
            ---
            
            
            176Subtenant
                deposit
            
            
            ---
            
            
            62Accounts
                payable and accrued expenses
            
            
            102
            
            
            (236
            )Accrued
                interest and other current liabilities
            
            
            187
            
            
            98Restricted
                cash
            
            
            (69
            )
            
            (600
            )NET
                CASH USED IN OPERATING ACTIVITIES
            
            
            (1,582
            )
            
            (1,457
            )CASH
                FLOWS FROM INVESTING ACTIVITIES:Acquisition
                  of SuperStock, net of cash balance of $1,151 of SuperStock at date
                  of
                  acquisition
            
            
            ---
            
            
            (1,417
            )Additions
                to leasehold improvements
            
            
            (232
            )
            
            ---Investment
                in photo collection
            
            
            (9
            )
            
            ---Purchase
                of fixed assets
            
            
            (46
            )
            
            (294
            )NET
                CASH USED IN INVESTING ACTIVITIES
            
            
            (287
            )
            
            (1,711
            )CASH
                FLOWS FROM FINANCING ACTIVITIES:Proceeds
                from issuance of common stock
            
            
            1,204
            
            
            ---Proceeds
                from sale of land and building accounted for as loan
                payable
            
            
            ---
            
            
            7,457Net
                proceeds from senior secured notes payable
            
            
            2,250
            
            
            ---Net
                proceeds from sale of common stock and warrants
            
            
            ---
            
            
            2,790Proceeds
                from issuance of unsecured notes payable and warrants
            
            
            ---
            
            
            1,050Proceeds
                from issuance of conv
              ertible
                subordinated notes payable and warrants
            
            
            ---
            
            
            1,250Proceeds
                from loan payable
            
            
            23
            
            
            ---Payment
                of convertible subordinated notes payable
            
            
            (1,250
            )
            
            ---Payment
                of revolving credit line
            
            
            ---
            
            
            (1,700
            )








-
          4
          -
 
  **a21,
            Inc. and Subsidiaries**
 **CONDENSED
            CONSOLIDATED STATEMENTS OF CASH FLOW**
 **(Unaudited)**
 **($
            in thousands)**


**Nine
                Months Ended****September
                30,****2005**
            
            **2004**Payment
                of unsecured notes payable to affiliates
            
            
            ---
            
            
            (160
            )Payment
                of seller note payable
            
            
            ---
            
            
            (1,576
            )Payment
                of promissory note payable
            
            
            (33
            )
            
            ---Payment
                of note payable to bank
            
            
            ---
            
            
            (4,554
            )NET
                CASH PROVIDED BY FINANCING ACTIVITIES
            
            
            2,194
            
            
            4,557NET
                EFFECT OF CUMULATIVE TRANSLATION ADJUSTMENTS
            
            
            115
            
            
            22NET
                INCREASE IN CASH
            
            
            440
            
            
            1,411CASH
                AT BEGINNING OF PERIOD
            
            
            717
            
            
            1CASH
                AT END OF PERIOD
            
            $
            1,157
            
            $
            1,412SUPPLEMENTAL
                DISCLOSURE OF CASH FLOW INFORMATION:Income
                taxes paid (refunded)
            
            $
            (108
            )
            $
            108Interest
                paid
            
            
            769
            
            
            193SUPPLEMENTAL
                DISCLOSURE OF NON-CASH FINANCING AND INVESTING ACTIVITIES:Repayment
                of notes payable to affiliates
            
            
            ---
            
            
            424Issuance
                of common stock for accrued interest on notes payable to
                affiliates
            
            
            ---
            
            
            51Issuance
                of common stock for accrued compensation
            
            
            ---
            
            
            136Issuance
                of common stock for placement costs in connection with the sale of
                common
                stock
            
            
            ---
            
            
            13Issuance
                of common stock to sellers as part of acquisition cost of
                SuperStock
            
            
            ---
            
            
            137Deferred
                compensation
            
            
            397
            
            
            ---Debt
                discount recorded for the issuance of warrants in connection with
                unsecured note payable and convertible subordinated notes
                payable
            
            
            17
            
            
            422Debt
                discount recorded for beneficial conversion of convertible subordinated
                notes payable
            
            
            ---
            
            
            1,105Issuance
                of warrants as part of acquisition cost of SuperStock
            
            
            ---
            
            
            83Note
                payable to sellers on acquisition of SuperStock
            
            
            ---
            
            
            1,576Accrued
                purchase price payable
            
            
            105
            
            
            300Minority
                interest
            
            
            ---
            
            
            2,800Acquisition
                of SuperStock (See Note C)
            
            
            ---
            
            
            7,477Adjustment
                to goodwill for reduction in valuation allowance for tax
                asset
            
            
            ---
            
            
            484The
                accompanying notes are an integral part of these Condensed Consolidated
                Financial Statements.








-
          5
          -


**a21,
        Inc. and Subsidiaries**
 **CONDENSED
        CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (CAPITAL
        DEFICIT)**
 **(Unaudited)**
 **($
        in thousands)**


COMMON
                STOCK
            
            TREASURY
                STOCK
            
            
            
            
            
            
            
            ACCUMULATEDNUMBER
            
            
            
            NUMBER
            
            
            
            ADDITIONAL
            
            
            
            
            
            OTHEROF
            
            
            
            OF
            
            
            
            PAID-IN
            
            DEFERRED
            
            ACCUMULATED
            
            COMPREHENSIVESHARES
            
            AMOUNT
            
            SHARES
            
            AMOUNT
            
            CAPITAL
            
            COMPENSATION
            
            DEFICIT
            
            INCOME
            
            TOTALBalance
                at December 31, 2004
            
            
            41,816
            
            $
            42
            
            
            (3,680
            )
            $
            ---
            
            $
            10,599
            
            $
            ---
            
            $
            (9,411
            )
            $
            (40
            )
            $
            1,190Issuance
                of warrantsto
                the holders of seniorsecured
                notes payable
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            17
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            17Issuance
                of warrantsto
                the holders ofunsecured
                notespayable
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            19
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            19Beneficial
                conversionfeature
                of convertiblesubordinated
                notespayable
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            (263
            )
            
            ---
            
            
            ---
            
            
            ---
            
            
            (263
            )Compensation
                from theissuance
                of restrictedstock
            
            
            3,165
            
            
            3
            
            
            ---
            
            
            ---
            
            
            394
            
            
            (397
            )
            
            ---
            
            
            ---
            
            
            ---Amortization
                of deferredcompensation
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            208
            
            
            ---
            
            
            ---
            
            
            208Charge
                for the cost ofvariable
                optioncompensation
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            28
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            28Issuance
                of commonstock
            
            
            8,000
            
            
            8
            
            
            ---
            
            
            ---
            
            
            1,192
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            1,200Stock
                options exercised
            
            
            25
            
            
            
            
            
            
            
            
            
            
            
            4
            
            
            
            
            
            
            
            
            
            
            
            4Net
                loss
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            (3,310
            )
            
            ---
            
            
            (3,310
            )Other
                comprehensiveincome
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            ---
            
            
            115
            
            
            115Balance
                at September 30, 2005
            
            
            53,006
            
            $
            53
            
            
            (3,680
            )
            $
            ---
            
            $
            11,990
            
            $
            (189
            )
            $
            (12,721
            )
            $
            75
            
            $
            (792
            )




The
        accompanying notes are an integral part of these Condensed Consolidated
        Financial Statements.




-
          6
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





**NOTE
      A - FINANCIAL STATEMENT PRESENTATION**





The
      unaudited condensed consolidated financial statements of a21, Inc., a Texas
      corporation (“a21” or the “Company”) herein have been prepared pursuant to the
      rules and regulations of the Securities and Exchange Commission (“SEC”) and, in
      the opinion of management, reflect all adjustments (consisting only of normal
      recurring accruals) necessary to present fairly the financial position at
      September 30, 2005 and the results of operations for the interim periods
      presented. Certain information and footnote disclosures normally included in
      financial statements prepared in accordance with accounting principles generally
      accepted in the United States of America have been condensed or omitted pursuant
      to such SEC rules and regulations. Results of operations for interim periods
      are
      not necessarily indicative of those to be achieved for full fiscal years. These
      condensed consolidated financial statements should be read in conjunction with
      the Company’s audited financial statements included in the Company’s amended
      annual report on Form 10-KSB/A for the year ended December 31, 2004 filed with
      the SEC.





The
      Company concluded that its Annual Report on Form 10-KSB for the fiscal year
      ended December 31, 2004 and Quarterly Report of Form 10-QSB for the period
      ended
      March 31, 2005 needed to be amended and the financial statements therein could
      no longer be relied upon and on September 20, 2005 filed an amended Annual
      Report on Form 10-KSB for the fiscal year ended December 31, 2004 and amended
      Quarterly Report on Form 10-QSB for the period ended March 31, 2005. The
      restatements reflect additional debt discount and additional paid-in capital
      of
      $944,000 and related amortization of $393,000 for the year ended December 31,
      2004 due to a beneficial conversion feature contained in the Company’s
      convertible subordinated notes which were issued in February 2004 in connection
      with the acquisition of SuperStock, Inc. Furthermore, the restatements increased
      the net loss by $288,000 for the quarter ended March 31, 2005, which reflects
      additional amortization of debt discount of $70,000 and a $371,000 loss on
      extinguishment of debt when the notes were repaid in February 2005.
      Additionally, the Company amended the SuperStock purchase price allocation
      to
      reduce goodwill and the deferred tax liability by $1,234,000. As previously
      reported, in connection with the acquisition a deferred tax liability was
      recorded relating to timing differences associated with certain of the acquired
      assets. However, at the time of the acquisition, the Company had a deferred
      tax
      asset relating to net operating loss carryforwards available to offset future
      taxable income, which was fully reserved against. The financial statements
      were
      restated to reflect the deferred tax liability from the acquisition as a
      reduction of the deferred tax asset. An additional deferred tax liability,
      which
      was previously reflected as income tax expense during the quarter ended March
      31, 2005 was also offset against the deferred tax assets in the restatement.
      Accordingly, the net loss for the quarter ended March 31, 2005 was reduced
      by
      $7,000.





Through
      February 29, 2004, the Company was considered a development stage enterprise
      in
      accordance with Statement of Financial Accounting Standards (“SFAS”) No. 7,
“Accounting and Reporting by Development Stage Enterprises.” As a result of its
      acquisition of SuperStock, Inc. and subsidiaries (“SuperStock”) on February 29,
      2004, the Company commenced planned principal operations and as such, it is
      no
      longer considered to be a development stage company in accordance with SFAS
      No.
      7.





In
      February 2004, the Company completed its acquisition of SuperStock (see Note
      C)
      and in June 2004, sold SuperStock’s land and building for approximately $7.7
      million and leased it back (see Note I). The unaudited condensed consolidated
      financial statements of the Company include the accounts of SuperStock from
      the
      acquisition date of February 29, 2004. The minority interest in the condensed
      consolidated balance sheet at September 30, 2005 represents the interest of
      the
      holders of preferred shares of SuperStock, which are exchangeable into common
      shares of a21. The minority interest was valued at the estimated market value
      of
      the a21 shares at the acquisition date as if exchanged on such
      date.








-
          7
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





The
      accompanying condensed consolidated financial statements have been prepared
      assuming that the Company will continue as a going concern. The Company has
      sustained recurring losses and at September 30, 2005, had an accumulated deficit
      of $12,721,000 and a working capital deficit of $1,028,000. The Company has
      funded operations by raising capital through the private placement of common
      stock, convertible and other debt instruments, and through the sale of assets.
      In February 2005, the Company completed a debt financing that yielded
      $1,000,000, net of retirement of prior debt. In June 2005, the Company amended
      and restated its unsecured notes payable, resulting in the aggregate amount
      outstanding remaining at $1,050,000 (see Note H[2]). In September 2005, the
      Company raised $1,204,000 of additional capital through the sale of its common
      stock.





In
      October 2005, the Company raised $3,166,000 of additional capital through the
      sale of its common stock (see Note L [1]). While the Company believes
      that
      the amount of its current capital will be sufficient for the next twelve months
      based on its current internal growth plan, the Company will need to raise
      additional capital to conclude any potential growth by acquisitions and to
      retire its unsecured notes which mature on July 15, 2006. Because the
      assumptions upon which its business plan was based are subject to change, there
      can be no guarantee that the Company will have sufficient capital or will be
      able to obtain sufficient capital to execute its business
      plan. Additionally, if the Company needs to secure additional capital
      to
      fund its business plan, there can be no guarantee that the Company will be
      successful in closing any debt, equity or other potential transactions on terms
      favorable to the Company, if at all. The Company intends to raise additional
      capital through financings by the issuance of debt, equity or other potential
      transactions to support the Company’s business plan for internal growth and
      growth by acquisitions.





**NOTE
      B - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**





[1]
      Nature of Business:





The
      Company licenses and acquires stock photography for worldwide distribution
      to
      advertisers, publishers, and end users through sublicense and license
      agreements.





[2]
      Principles of consolidation:





The
      consolidated financial statements include the accounts of the Company and its
      subsidiaries, including the accounts of SuperStock from the acquisition date
      of
      February 29, 2004. The minority interest in the consolidated balance sheet
      at
      September 30, 2005 represents the interest of the holders of preferred shares
      of
      SuperStock, which are exchangeable into common shares of a21. The minority
      interest was valued at the estimated market value of the shares of a21’s common
      stock at the acquisition date as if exchanged on such date. All significant
      intercompany balances and transactions have been eliminated.





[3]
      Revenue recognition:





The
      license fees earned by the Company from reproductions are affected by the manner
      in which they are used by clients. Revenue is recognized when the following
      criteria are met: evidence of an arrangement exists, the price is fixed or
      determinable, collectibility is reasonably assured and delivery has occurred
      or
      services have been rendered. Revenue is recorded at invoiced amounts except
      in
      the case of licensing rights through distributors, where revenue is recorded
      at
      the Company’s share of invoiced amounts. Distributors typically earn and retain
      a percentage of the license fee according to their contract, and the Company
      recognizes the remaining percentage as revenue.








-
          8
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





[4]
      Cost
      of revenue:





Cost
      of
      revenue reflects royalties on revenue generated from images licensed by the
      Company under contracts with photographers. Royalties are expensed in the period
      that they are incurred.





[5]
      Use
      of estimates:





The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States of America requires management to make
      estimates and assumptions that affect the reported amounts of assets and
      liabilities and disclosure of contingent assets and liabilities at the date
      of
      the financial statements and the reported amounts of revenue and expenses during
      the reporting period. Actual results could differ from these estimates. The
      recoverability of the carrying values of long-lived assets is subject to the
      continuation of certain supplier relationships and estimates of recorded
      goodwill value.





[6]
      Fair
      value of financial instruments:





Financial
      instruments consist primarily of cash, accounts receivable, accounts payable,
      accrued expenses, and short-term debt, which approximate fair value because
      of
      their short maturities. The carrying amount of long-term debt approximates
      fair
      value due to the market rate of interest carried by such instruments. The fair
      value of the Company's notes payable to an affiliated company cannot be
      reasonably determined due to the related party nature of the
      transactions.





**** [7]
      Cash
      and cash equivalents:





The
      Company considers all highly liquid debt instruments purchased with an original
      maturity of three months or less to be cash equivalents. At September 30, 2005,
      the Company had no investments with maturities greater than three months. As
      of
      September 30, 2005, cash excludes restricted cash in the amount of $669,000
      to
      secure a letter of credit which the Company was required to maintain in
      accordance with its lease agreement for the SuperStock facility (see Note K).
      In
      November 2005, the Company received two certificates of deposit (“CDs”) from
      investors in the aggregate amount of $690,000 in exchange for its issuance
      of
      promissory notes and restricted common stock. The CDs replace the current
      deposits maintained by the Company that secure the letter of credit (See Note
      L[4]).





[8]
      Inventory:





Inventories
      are valued at the lower of cost or market. The costs of the compact disk
      products are determined on the first-in, first-out (FIFO) basis. Physical counts
      of inventories are taken at least annually. The need for a provision for
      estimated losses from obsolete, excess or slow-moving inventories is reviewed
      periodically.





[9]
      Foreign Currency Translation:





The
      Company’s U.K. and Canada operations use the U.S. dollar as the functional
      currency. As such, its monetary assets and liabilities are translated into
      U.S.
      dollars at current exchange rates.








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          9
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





[10]
      Land
      and Building:





The
      land
      and building were sold and leased back in a transaction accounted for as a
      financing (see Note I). The building is being depreciated over the twenty-year
      term of the related lease.





[11]
      Property and equipment:





Property
      and equipment are recorded at cost. Expenditures for major additions and
      betterments are capitalized. Maintenance and repairs are charged to operations
      as incurred. Depreciation of property and equipment is computed using the
      straight-line method over the assets' estimated lives ranging from three to
      seven years. Upon sale or retirement of property and equipment, the related
      cost
      and accumulated depreciation are removed from the accounts and any gain or
      loss
      is reflected in operations.





[12]
      Photo collection:





In
      connection with the acquisition of SuperStock, $2,607,000 of the purchase price
      was allocated to the photo collection. Expenditures for additions and
      betterments to the collection are capitalized. The photo collection is
      categorized by type of imagery (fine art, vintage and contemporary).
      Depreciation of the photo collection is computed by the straight-line method
      over the assets’ estimated lives of forty years for fine art and vintage images
      and four years for contemporary images. Upon sale or retirement of any portion
      of the collection, the related cost and accumulated depreciation are removed
      from the accounts and any gain or loss is reflected in operations. At September
      30, 2005, the net book value of the entire photo collection was $1,839,000,
      including fine art and vintage images of $687,000 and contemporary images of
      $1,152,000.




[13]
      Goodwill:





The
      Company has adopted Statement of Financial Accounting Standards (SFAS) No.
      142,
“Goodwill and Other Intangible Assets”. The Company tests the goodwill balance
      for impairment annually and between annual tests in certain circumstances.
      When
      assessing impairment, the Company must estimate the implied fair value of the
      goodwill. The Company estimated the implied fair value based on a discounted
      cash flow model that involves significant assumptions and estimates based on
      management’s best judgments of current and future circumstances, including
      currently enacted tax laws, the future weighted average cost of capital, and
      our
      future financial performance. As circumstances change, it is reasonably possible
      that future goodwill impairment tests could result in a loss resulting from
      an
      impairment of assets, which would be included in the determination of net income
      (loss). The Company also amortizes intangible assets with finite lives over
      their estimated useful life and reviews for impairment in accordance with SFAS
      144. Intangible assets with finite lives are amortized using the straight line
      method over their expected useful life of four years.








-
          10
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





[14]
      Long-lived assets:





The
      Company evaluates its long-lived assets in accordance with Statement of
      Financial Accounting Standards ("SFAS") No. 144, "Accounting for the Impairment
      or Disposal of Long-Lived Assets," pursuant to which an impairment loss is
      recognized if the carrying amount of a long-lived asset is not recoverable
      and
      exceeds its fair value. The Company estimated the implied fair value based
      on a
      discounted cash flow model that involves significant assumptions and estimates
      based on management’s best judgments of current and future circumstances,
      including currently enacted tax laws, the future weighted average cost of
      capital, and our future financial performance.





[15]
      Income taxes:





The
      Company recognizes deferred tax assets and liabilities for both the expected
      impact of differences between the financial statements and tax bases of assets
      and liabilities, and for the expected future tax benefit to be derived from
      tax
      loss and tax credit carryforwards (if any). Deferred
      tax assets are reduced, if necessary, by a valuation allowance if it is more
      likely than not that some portion or all of the deferred tax assets will not
      be
      realized.





[16]
      Net
      loss per share:





The
      Company calculates net loss per share in accordance with the provisions of
      SFAS
      No. 128, "Earnings Per Share." SFAS No. 128 requires a dual presentation of
      "basic" and "diluted" income (loss) per share on the face of the statements
      of
      operations. Basic income (loss) per share is computed by dividing the net income
      (loss) by the weighted average number of shares of common stock outstanding
      during each period. Diluted income (loss) per share includes the effect, if
      any,
      from the potential exercise or conversion of securities, such as stock options
      and warrants, which would result in the issuance of incremental shares of common
      stock. For the nine months ended September 30, 2005 and 2004, the basic and
      diluted net loss per share is the same since the effect from the potential
      exercise of 36,923,987 and 33,407,588 outstanding stock options and
      warrants as of September 30, 2005 and 2004, respectively, would have been
      anti-dilutive. In addition, 5,000,151 shares of common stock issuable upon
      the
      exchange of the seller’s non-voting participating preferred stock (see Note C)
      have been excluded for the nine months ended September 30, 2005.





[17]
      Stock-based compensation:





The
      Company accounts for stock-based employee compensation under Accounting
      Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued to
      Employees," and related interpretations. The Company has adopted the
      disclosure-only provisions of SFAS No. 123, Accounting for Stock-Based
      Compensation," and SFAS No. 148, "Accounting for Stock-Based Compensation -
      Transition and Disclosure." The following table illustrates the effect on net
      loss and loss per share for the three and nine months ended September 30, 2005
      and 2004 if the fair value based method had been applied to all
      awards.








-
          11
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005








**$
                in thousands, except per share amounts**
            
            **For
                the Three Months Ended September 30,**
            
            **For
                the Nine Months Ended September 30,****2005**
            
            **2004**
            
            **2005**
            
            **2004**Reported
                net loss
            
            $
            (1,343
            )
            $
            (1,046
            )
            $
            (3,310
            )
            $
            (1,997
            )Stock
                based employee compensation included in net loss
            
            
            28
            
            
            34
            
            
            28
            
            
            161Stock-based
                employee compensation determined under the fair value based
                method
            
            
            (27
            )
            
            (2
            )
            
            (88
            )
            
            (79
            )Pro
                forma net loss
            
            $
            (1,342
            )
            $
            (1,014
            )
            $
            (3,370
            )
            $
            (1,915
            )Loss
                per share - basic and dilutedAs
                reported
            
            $
            (0.03
            )
            $
            (0.03
            )
            $
            (0.08
            )
            $
            (0.06
            )Pro
                forma
            
            $
            (0.03
            )
            $
            (0.03
            )
            $
            (0.08
            )
            $
            (0.06
            )





The
      fair
      value of each option is measured at the grant date using the Black-Scholes
      option-pricing model with the following weighted average assumptions used for
      stock options granted during the three and nine months ended September 30,
      2005
      and 2004: annual dividends of $0.00, expected volatility of 80%, risk free
      interest rate of 3.00%, and an expected life of five years.





Compensation
      expense of $28,000 and $161,000 was recorded in the consolidated statements
      of
      operations for the nine months ended September 30, 2005 and 2004, respectively,
      pursuant to variable accounting for certain options.





[18]
      Advertising:





Advertising
      expenses were $631,000 and $454,000 for the nine months ended September 30,
      2005
      and 2004, respectively. Advertising costs are charged to expense as
      incurred.





**NOTE
      C - ACQUISITION OF SUPERSTOCK, INC.**





In
      February 2004, the Company completed the acquisition of all of the voting common
      stock, representing 83% of the outstanding equity, of SuperStock, a licensor
      of
      stock images to the advertising, media and publishing industries. SuperStock's
      primary assets included a collection of images that it either owned or licensed
      from third parties, an approximately 73,000 square foot facility in
      Jacksonville, Florida (which the Company, through our SuperStock subsidiary,
      sold and leased back from the buyer), receivables from its customers and cash.








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          12
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





In
      consideration for the sale and purchase of the shares of common stock of
      SuperStock, the sellers received 1,666,717 shares of non-voting participating
      preferred stock of SuperStock which is exchangeable into 5,000,151 shares of
      the
      Company’s common stock, $2.6 million in cash and a 14 month secured note in the
      amount of $1.6 million that initially paid an interest rate of LIBOR plus 1.9%
      per annum. In addition, the Company granted warrants to the sellers to purchase
      160,000 shares of its common stock at $0.56 per share and issued to the sellers
      and their advisors 573,589 shares of the Company’s common stock for $150,000
      consideration. Final adjustments were made to the purchase price upon
      finalization of SuperStock's closing balance sheet pursuant to which the Company
      agreed to pay $100,000 to the sellers in three installments. The first
      installment was paid upon the signing of the final agreement, the second
      installment is due on March 1, 2006 and the third installment is due on March
      1,
      2007. The deferred payments due March 1, 2006 and March 1, 2007 in the form
      of a
      promissory note bear interest at the rate of 5% per annum commencing March
      1,
      2005 until paid in full.





As
      part
      of the original purchase agreement, the sellers may also receive up to $1.5
      million should SuperStock achieve certain revenue milestones during the four
      year period after closing. The amount due for the first year (March 1, 2004
      through February 28, 2005) was $201,000, and was accrued as a cost of the
      acquisition. The amount due for the second year (March 1, 2005 through February
      28, 2006) has been estimated at $180,000; as of September 30, 2005, $105,000
      has
      been accrued as a non-operating expense.





In
      addition, the Company repaid a $1.7 million credit facility of SuperStock and
      paid down $500,000 of a note secured by a first mortgage on the SuperStock
      Facility. This reduced the principal balance on the note secured by a first
      mortgage to $4.0 million at an interest rate of LIBOR plus 1.9% payable monthly
      plus principal.





The
      aggregate purchase price was approximately $7,477,000. The following summarizes
      the fair values of the assets acquired and liabilities assumed at the date
      of
      acquisition.





**($
                in thousands)**Current
                assets
            
            $
            2,473Land
                and building
            
            
            7,572Photo
                collection
            
            
            2,607Property
                and equipment
            
            
            469Goodwill
            
            
            1,350Contracts
                with photographers
            
            
            1,304Other
                intangible assets
            
            
            116Other
                long-term assets
            
            
            342Note
                payable to bank - current
            
            
            (4,554
            )Other
                current liabilities
            
            
            (3,171
            )Deferred
                income taxes
            
            
            (1,031
            )$
            7,477





Results
      of operations of SuperStock are included in the accompanying financial
      statements from February 29, 2004, the date of acquisition.








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          13
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





**NOTE
      D -- PROPERTY AND EQUIPMENT**





Property
      and equipment is stated at cost, less accumulated depreciation and amortization,
      and at September 30, 2005 and December 31, 2004, is summarized as
      follows:








**($
                in thousands)**
            
            **September
                30, 2005**
            
            **December
                31, 2004**Furniture,
                fixtures & office equipment
            
            $
            293
            
            $
            412Photo/Computer
                equipment
            
            
            463
            
            
            407Software
            
            
            160
            
            
            138Less:
                Accumulated depreciation
            
            
            (505
            )
            
            (410
            )Total
                property & equipment, net
            
            $
            411
            
            $
            547





Depreciation
      and amortization in the amount of $1,075,000 and $675,000 are included in
      expenses for the nine months ended September 30, 2005 and 2004, respectively,
      in
      the condensed consolidated statements of operations and include depreciation
      and
      amortization for land and building, the photo collection and the contracts
      with
      photographers.





**NOTE
      E -- GOODWILL AND OTHER INTANGIBLE ASSETS**





Goodwill
      of $1,049,000 represents the excess of the purchase price over the fair value
      of
      tangible and identifiable intangible assets associated with the acquisition
      of
      SuperStock, Inc. described in detail in Note C. Goodwill has been reduced by
      $301,000 to reflect the utilization of SuperStock’s net operating loss
      carryforward on the sale of the land and building.





Identifiable
      intangible assets with finite lives are shown net of amortization and are
      principally comprised of covenants not to compete, which are amortized over
      four
      years.





Contracts
      with photographers ($980,000, net of amortization, as of September 30, 2005)
      are
      attributable to the acquisition of SuperStock, Inc. These contracts have an
      average life of five years and are automatically renewable. Amortization of
      the
      photographer’s contracts is based on projected revenues expected to be generated
      over the estimated ten year life of the underlying images.





**NOTE
      F -- MINORITY INTEREST**





As
      part
      of the financing to acquire all of the shares of SuperStock’s common stock,
      representing 83% of the outstanding equity of SuperStock, in consideration
      for
      the sale and purchase of such shares, the sellers received 1,666,717 shares
      of
      non-voting participating preferred stock of SuperStock, which are exchangeable
      for 5,000,151 shares of a21 common stock. The preferred stock has no voting
      rights, pays no dividend, and, except for exchange rights into a21 common stock,
      it has no other special rights except for liquidation rights. In liquidation,
      it
      is senior to the common stock of SuperStock and has distribution rights to
      the
      greater of $4.25 million or 17% of the total liquidation distributions made
      after distributions to creditors.





The
      minority interest was recorded as if it were exchanged into a21 common stock
      at
      the closing price on the day of the acquisition.








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          14
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





**NOTE
      G -- OPERATING SEGMENTS**





The
      Company began operating domestically and internationally beginning February
      29,
      2004. The following table presents information about the Company’s domestic and
      international activity, including minority interest.





**($
                in thousands)****Domestic**
            
            **International**
            
            **Total**Three
                months ended September 30, 2005Revenue
            
            $
            1,788
            
            $
            276
            
            $
            2,064Segment
                Loss
            
            
            (1,229
            )
            
            (114
            )
            
            (1,343
            )Three
                months ended September 30, 2004Revenue
            
            $
            1,708
            
            $
            369
            
            $
            2,077Segment
                Loss
            
            
            (1,012
            )
            
            (34
            )
            
            (1,046
            )Nine
                months ended September 30, 2005Revenue
            
            $
            5,732
            
            $
            971
            
            $
            6,703Segment
                Loss
            
            
            (3,151
            )
            
            (159
            )
            
            (3,310
            )Segment
                Assets at September 30, 2005
            
            
            15,258
            
            
            402
            
            
            15,660Nine
                months ended September 30, 2004Revenue
            
            $
            4,533
            
            $
            869
            
            $
            5,402Segment
                Loss
            
            
            (1,901
            )
            
            (96
            )
            
            (1,997
            )Segment
                Assets at September 30, 2004
            
            
            15,952
            
            
            372
            
            
            16,324








Domestic
      segment information includes $441,000 and $451,000 of revenue and $369,000
      and
      $326,000 of account receivables, respectively, for the three months ended
      September 30, 2005 and 2004, attributable to foreign agents utilized by a
      domestic subsidiary. Domestic segment information includes $1,341,000 and
      $1,027,000 of revenue and $369,000 and $326,000 of account receivables,
      respectively, for the nine months ended September 30, 2005 and 2004,
      attributable to foreign agents utilized by a domestic subsidiary. International
      segment information reflects the operation of foreign subsidiaries. Those
      amounts are not based on the geographic origin of customers, which is not
      readily determinable.





**NOTE
      H - DEBT FINANCINGS**





[1]
      Convertible Subordinated Notes Payable:





In
      February 2004, the Company received $1,250,000 in connection with the issuance
      of two-year convertible subordinated notes (due February 29, 2006) which accrued
      interest at 12% for the first six months of the term thereof, 13.5% for the
      next
      twelve months of the term thereof, and 15% for the last six months of the term
      thereof and were convertible into the Company’s common stock along with 937,500
      callable warrants exercisable at prices between $0.45 and $1.35 per share.
      The
      notes were convertible at a price based on a 30% discount to a twenty day
      average market price of the Company’s common stock, subject to a ceiling of
      $2.00 and, beginning in the thirteenth month after the closing of the
      acquisition of SuperStock, a floor of $0.90.








-
          15
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





The
      Company allocated the proceeds received to the principal amount of the note
      and
      the warrants based upon the relative fair value method. The fair value of the
      warrants was determined using the Black Scholes pricing model. Of the proceeds,
      $145,000 was allocated to the warrants and was recorded as debt discount and
      additional paid-in capital and $1,105,000 was allocated to the notes. Based
      on
      the market value of the common shares issuable upon conversion, as compared
      to
      the proceeds allocated to the notes, further debt discount and additional
      paid-in capital of $1,105,000 was recorded for the beneficial conversion
      feature. The aggregate discount was being amortized over the two-year term
      of
      the note, and the carrying amount of the notes of $520,000 at December 31,
      2004
      is presented net of the unamortized debt discount. In February 2005, the Company
      repaid the notes and accrued interest (see item [3] below).





[2]
      Unsecured Notes Payable:





On
      February 29, 2004, the Company received $1,050,000 in connection with the
      issuance of unsecured debt in the form of promissory notes (the “Original
      Notes”), which accrued interest at 12% for up to twelve months along with
      630,000 callable warrants at $0.45 per share (the “Original Warrants”). In
      addition, the Company issued 63,000 warrants exercisable at $0.45 per share
      to
      an investment-banking firm in connection with the placement of the unsecured
      debt. The Original Notes matured on August 29, 2004, but provided for an
      automatic extension, if not paid, of six months with monthly extensions
      thereafter. The fair value of the warrants, which amounted to $245,000, was
      determined using the Black Scholes pricing model and was recorded as debt
      discount and additional paid-in capital. Since the notes were still outstanding
      as of August 29, 2004, the number of shares subject to warrants was increased
      by
      50% (315,000 callable warrants) at $0.45 per share. The fair value of the
      warrants issued for the six-month extension, which amounted to $31,000, was
      determined using the Black Scholes pricing model and was recorded as debt
      discount and additional paid-in capital. The discount was amortized over the
      six-month term of the promissory notes.





For
      every
      month thereafter until the Original Notes were amended, the Note holders were
      entitled to receive bonus warrants to purchase an additional 105,000 shares
      in
      the aggregate of the Company’s common stock at $0.45 per share (equivalent to
      one-ninth of the then total shares underlying the Original Warrants). During
      the
      four months ended May 2005, a total of 420,000 bonus warrants were issued.
      The
      fair value of the 420,000 bonus warrants, which amounted to $19,000, was
      determined using the Black Scholes pricing model and recorded as expense and
      additional paid-in capital. Upon the amendment and restatement of the Original
      Notes and issuing Restated Warrants, (as defined below), the holders surrendered
      their Original Notes and Original Warrants and all monthly bonus
      warrants.





On
      June
      24, 2005, the Company amended and restated these unsecured notes (the “Restated
      Notes”). The aggregate amount outstanding under the Restated Notes remains at
      $1,050,000. The Restated Notes mature on July 15, 2006 (the “Maturity Date”) and
      bear interest due quarterly commencing on September 30, 2005 at a rate of 12%
      per annum, which increases to 18% per annum after the Maturity Date. The initial
      interest payment due September 30, 2005 included interest accrued from the
      February 29, 2004 date of issuance of $200,000. The Restated Notes include
      customary events of default, including the Company’s failure to pay any
      principal or interest when due, the Company’s insolvency or bankruptcy, or sale
      of substantially all of the Company’s assets. Upon the occurrence of an event of
      default, a Restated Note becomes due and payable at the written demand of the
      holder thereof.








-
          16
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





In
      connection with the issuance of the Restated Notes, the note holders received
      amended and restated warrants that expire February 28, 2009 (the “Restated
      Warrants”). An aggregate of 945,000 shares of the Company’s common stock (the
“Restated Warrant Shares”) may be purchased with the Restated Warrants at $0.225
      per share (subject to adjustment from time to time), 630,000 of which shares
      were previously registered under the Securities Act pursuant to the Company’s
      registration statement on Form SB-2 (333-117929). Upon any prepayment of the
      Restated Notes, a pro rata portion of the Restated Warrants will be cancelled.
      The aggregate number of Restated Warrant Shares shall not increase unless the
      Restated Notes remain outstanding after the Maturity Date, in which case bonus
      warrants will be issued each month to the holders of the Restated Warrants
      to
      purchase an aggregate of 39,375 of the Restated Warrant Shares until the
      Restated Notes are repaid in full. The exercise price of these bonus warrants
      shall be the lower of $0.225 per share or 50% of the average closing price
      of
      the Company’s common stock for the twenty trading days prior to and including
      July 15, 2006.





[3]
      Senior Secured Notes Payable





On
      February 22, 2005, a21, Inc. consummated a $2,250,000 financing (the
      "Financing") in the form of two-year interest only senior (non-convertible)
      secured notes and retired $1,250,000 of its two-year convertible subordinated
      notes issued in conjunction with a21's acquisition of SuperStock in February
      2004. The investors in the Financing were existing investors of a21 and were
      also holders of the Subordinated Notes (as defined below). In the Financing,
      SuperStock issued new 12% senior secured notes due in February 2007 in the
      principal amount of $2,250,000 (the "Senior Notes") and retired all of its
      outstanding 13% convertible subordinated notes due February 28, 2006 (the
      "Subordinated Notes").





The
      Senior Notes may be prepaid without penalty at any time. They also have a
      provision which adds 4% of the original principal amount per year to their
      principal balance payable at maturity. For the nine months ended September
      30,
      2005, the principal balance has been increased by $54,500 based on this
      provision. In connection with the issuance of the Senior Notes, SuperStock
      entered into a security agreement, dated as of February 22, 2005 (the "Security
      Agreement"), pursuant to which it granted a first priority security interest
      in
      substantially all of the Company’s current and future assets.





Five
      year
      warrants to purchase 937,500 shares of a21 common stock originally issued to
      the
      holders of the Subordinated Notes were amended and restated whereby, inclusive
      of the right to purchase an additional 125,000 shares of a21 common stock,
      the
      holders of the Senior Notes received two year warrants to purchase an aggregate
      of 500,000 shares of a21 common stock at $0.225 per share and an aggregate
      of
      562,500 shares of a21 common stock at $0.45 per share (together, the
      "Warrants"). During the nine months ended September 30, 2005, a21 recorded
      an
      additional debt discount of $10,000 for the excess of the fair value of the
      warrants to purchase 1,062,500 shares of a21 common stock on the date of
      issuance over the fair value of the warrants to purchase 937,500 shares of
      a21
      common stock calculated at the time of amendment (reflecting the remaining
      term
      and the stock price on that date).





In
      September 2005, the Company issued 8,000,000 additional shares of common stock
      to accredited investors (see Note J[1]). Per an anti-dilution provision of
      the
      Warrants, this issuance of common stock resulted in an amendment of the exercise
      price of the warrants. The two year warrants to purchase an aggregate of 500,000
      shares of a21 common stock have been amended to have an exercise price of $0.188
      per share (originally $0.225 per share) and an aggregate of 562,500 shares
      of
      a21 common stock to have an exercise price of $0.377 per share (originally
      $0.45
      per share). In accordance with this amendment, the Company recorded an
      additional debt discount of $7,000 (reflecting the remaining term and the stock
      price on that date). The debt discount is being amortized as interest expense
      over the term of the Senior Notes. The effective interest rate is 17%.








-
          17
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





In
      connection with the Financing, SuperStock paid the $1,250,000 of Subordinated
      Notes as of February 22, 2005 which had a carrying amount of $617,000, net
      of
      debt discount. In connection with repaying the Subordinated Notes, SuperStock
      also terminated the Exchange Agreements which it had entered with the holders
      of
      the Subordinated Notes and setting forth the terms pursuant to which the
      Subordinated Notes could have been converted into shares of a21 common stock.
      The Company reduced additional paid-in capital by $263,000, representing the
      intrinsic value of the beneficial conversion feature when the debt was repaid
      and recognized a loss on extinguishment of debt of $371,000, for the difference
      between the intrinsic value and the unamortized debt discount at the time of
      extinguishment.





**NOTE
      I -- LOAN PAYABLE - SALE OF SUPERSTOCK LAND AND BUILDING**





On
      June
      30, 2004, the Company completed the sale and leaseback of the land and
      approximately 73,000 square foot building in Jacksonville, Florida where the
      Company’s headquarters are located. The facility was sold for $7.7 million for
      net proceeds of $7,516,000, of which $4,554,000 was used to repay a bank note
      that was secured by a first mortgage on the facility and $1,576,000 was used
      to
      repay other indebtedness to the selling shareholders of SuperStock. The building
      was leased back for a term of twenty years. The lease provides the Company
      with
      two five-year renewal options at specified payments.





The
      Company has entered into an agreement to sublease a significant portion of
      its
      facility, which provides payments to the Company aggregating $3.5 million over
      a
      six-year period.





Based
      on
      the terms of the subleasing arrangement, the transaction does not qualify for
      sale recognition and has been accounted for as a financing transaction pursuant
      to SFAS No. 98, "Accounting for Leases". Accordingly, the accompanying financial
      statements reflect the net proceeds from the sale of the land and building
      as a
      loan payable with an effective interest rate of 10.14% based on the payment
      terms of the lease. The land and building are included in property and equipment
      and are being depreciated on a straight-line basis over the twenty-year term
      of
      the lease.





The
      following table summarizes the Company’s annual maturities under the loan
      payable as of September 30, 2005:





**Year
                  Ending****September
                  30,($ in thousands)**2006
            
            
            
            
            $
            132007
            
            
            
            
            
            302008
            
            
            
            
            
            502009
            
            
            
            
            
            732010
            
            
            
            
            
            102Thereafter
            
            
            
            
            
            7,1897,457Less:
                Current Portion
            
            
            
            
            
            (13
            )Long
                Term Portion
            
            
            
            
            $
            7,444











-
          18
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





**NOTE
      J -- STOCKHOLDERS’ EQUITY (CAPITAL DEFICIT)**





[1]
      Common stock:





The
      Company is authorized to issue 100,000,000 shares of its $.001 par value common
      stock.





In
      February 2004, the Company received aggregate gross proceeds of $5.9 million
      in
      equity and debt financings. The Company received proceeds of $3.0 million (net
      proceeds of $2.8 million), and $600,000 of liabilities owed by the Company
      were
      exchanged in connection with the issuance of 18,000,000 shares of common stock
      along with 5,508,000 warrants exercisable at $0.20 per share and 19,828,800
      callable warrants exercisable at prices between $0.225 and $1.35 per share.
      In
      addition, the Company issued 450,000 shares of common stock to an
      investment-banking firm in connection with the placement of the equity. The
      liabilities that were exchanged included $475,000 of notes payable to affiliates
      and $125,000 of accrued compensation due to the Company’s Chairman and
      President.





During
      the year ended December 31, 2004, the Company issued 490,000 shares of its
      common stock for services and payment of equity placement costs and 670,000
      shares of its common stock for services in settlement of accrued compensation
      and compensation expense of $147,000 to officers and consultants.





During
      the nine months ended September 30, 2005, the Company issued 605,000 shares
      of
      its restricted common stock to its five non-employee directors as compensation
      for their services of which 142,500 are subject to repurchase, at the Company’s
      option, by the Company at $.01 per share as of September 30, 2005. The Company
      issued 2,410,000 shares of its restricted common stock to three of its officers
      pursuant to the terms of their employment agreements, of which 1,187,500 are
      subject to repurchase by the Company at $.01 per share as of September 30,
      2005.
      The Company also issued 150,000 shares of its restricted common stock to a
      consultant. These stock grants resulted in unamortized deferred compensation
      of
      $189,000 included in the Condensed Consolidated Statements of Stockholder’s
      Equity (Capital Deficit) as of September 30, 2005 and compensation expense
      of
      $208,000 for the nine months ended September 30, 2005.





During
      the three months ended September 30, 2005, the Company issued 8,000,000 shares
      of its restricted common stock with piggyback registration rights to accredited
      investors for $1,200,000 in cash.








[2]
      Stock
      options and warrants:





Options
      and warrants have been granted to officers, directors and employees based upon
      employment agreements and other agreements with investors at the discretion
      of
      the Board of Directors.





In
      March
      2005, the Company’s Board of Directors approved the 2005 Stock Incentive Plan
      (the “2005 Plan”) and, subject to shareholder approval, the issuance of up to
      6,000,000 shares of which up to 2,000,000 are in the form of options to the
      employees of SuperStock as agreed per the Amended and Restated Stock Purchase
      and Recapitalization Agreement by and among a21, SuperStock and its stockholders
      dated February 29, 2004. The 2005 Plan authorizes the Company’s board of
      directors to award Incentive Stock Options, Nonstatutory Stock Options, stock
      appreciation rights, performance shares, restricted stock or unrestricted stock
      to the employees and independent contractors, including





-
          19
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





consultants,
      directors, advisors and other service providers of the Company. Certain options
      and warrants to be granted under the 2005 Plan are intended to qualify as
      Incentive Stock Options (“ISOs”) pursuant to Section 422 of the Internal Revenue
      Code of 1986, as amended, while other options and warrants granted under the
      2005 Plan will be nonqualified options or warrants which are not intended to
      qualify as ISOs. A committee selected by the Company's Board of Directors has
      the authority to approve option grants and the terms, which include the option
      price and the vesting terms. Options granted under the 2005 Plan expire after
      a
      five-year period and are subject to acceleration upon the occurrence of certain
      events. As of September 30, 2005, 3,781,397 options were granted to employees
      under this plan and 2,218,603 options remained available for grant under the
      2005 Plan. On their respective grant dates, the exercise prices of the options
      were all at or above the market price of the Company’s common
      shares.





Pursuant
      to the Company’s 2002 Directors, Officers and Consultants Stock Option, Stock
      Warrant and Stock Award Plan, as amended (the "2002 Plan"), 3,000,000 shares
      of
      the Company's common stock are reserved for issuance. The 2002 Plan authorizes
      the Company’s board of directors to issue warrants, options, restricted or
      unrestricted common stock and other awards to the employees, consultants and
      directors of the Company and its affiliates. Certain options and warrants to
      be
      granted under the 2002 Plan are intended to qualify as Incentive Stock Options
      (“ISOs”) pursuant to Section 422 of the Internal Revenue Code of 1986, as
      amended, while other options and warrants granted under the 2002 Plan will
      be
      nonqualified options or warrants which are not intended to qualify as ISOs.
      A
      committee selected by the Company's Board of Directors has the authority to
      approve option grants and the terms, which include the option price and the
      vesting terms. Options granted under the 2002 Plan expire after a five-year
      period and are subject to acceleration upon the occurrence of certain events.
      As
      of September 30, 2005 there were 496,264 options available for grant under
      the
      2002 Plan.





**NOTE
      K -- COMMITMENTS AND OTHER MATTERS**





[1]
      Consulting and advisory services agreements (see Note K[4]):





In
      September 2002, the Company entered a three-year agreement with a consultant
      to
      act as the Company's Chairman of the Board. The agreement calls for initial
      payments of $15,000 per month, to be adjusted for certain events, as defined.
      Compensation may be payable in common shares of the Company at the individual's
      option in the event that the Company does not make above payments in cash at
      the
      end of each month. The rate at which common shares were issued was 150% of
      cash
      compensation due or restricted common shares at 200% of the cash compensation
      due. During 2003 the Company issued 1,013,005 shares of common stock as
      consideration for $105,000 of accrued compensation. In addition, in January
      2004, the Company awarded the consultant an option to purchase 1,505,514 common
      shares at $0.30. In May 2004, the consultant agreed to serve as Chief Executive
      Officer. This consulting agreement has been terminated and the Company and
      executive officer have entered into an employment agreement whereby he serves
      as
      a21’s Chief Executive Officer.





Pursuant
      to a consulting agreement dated July 1, 2002 between the Company and one of
      its
      stockholders, the stockholder agreed to serve as a consultant to the Company
      and
      to provide marketing and consulting services. As compensation for his services,
      the Company issued the stockholder a warrant to purchase 50,000 shares of common
      stock at an exercise price of $0.25 per share, and issued 30,000 shares of
      common stock in 2002 and 30,000 shares in 2003. The agreement with the Company
      has expired and the Company entered into an employment contract with this
      executive officer, who currently serves as Vice Chairman, President and Chief
      Financial Officer of a21 and Chief Executive Officer of SuperStock. Prior to
      these positions, he served as Chief Strategic Officer from June 2004 to December
      2004 and from February 2001 to May 2004, he served as an advisor.








-
          20
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





In
      September 2002, the Company entered into a two-year agreement with an employee
      to act as the Company's President. The agreement called for initial payments
      of
      $15,000 per month, to be adjusted for certain events, as defined. Compensation
      was payable in common shares of the Company at the option of the individual
      in
      the event that the Company does not make above payments in cash at the end
      of
      each month. The rate at which common shares were issued was 150% of cash
      compensation due or restricted common shares at 200% of the cash compensation
      due. During 2003 the Company issued 1,138,005 shares of common stock as
      consideration for $120,000 of accrued compensation. The employee was also
      provided with options to purchase up to 400,000 common shares of the Company
      with 160,000 options exercisable at $0.50, 120,000 exercisable at $1.00 and
      120,000 exercisable at $1.50. Such options will expire May 1, 2007. In addition,
      in January 2004, the Company awarded the employee an option to purchase 577,941
      common shares at $0.30. The agreement with the Company has expired and the
      Company entered into a new employment contract with this executive officer,
      who
      currently serves as Chief Creative Officer of a21, and President and Chief
      Creative Officer of SuperStock.





[2]
      Lease
      commitments:




The
      capital lease agreement for the Company’s headquarters facility (see Note I)
      includes a requirement to maintain a security deposit, funded as a letter of
      credit in the amount of $660,000, which is secured by restricted cash of
      $669,000 in the balance sheet as of September 30, 2005. The lease agreement
      also
      requires the Company to fund additional $30,000 deposits on the first day of
      each July, October, January, and April beginning July 1, 2005 up to and
      including July 1, 2006, for a total of $750,000. In November 2005, the Company
      received two certificates of deposit (“CDs”) from investors in the aggregate
      amount of $690,000 in exchange for its issuance of promissory notes and
      restricted common stock. The CDs replace the current deposits maintained by
      the
      Company that secure the letter of credit (See Note L[4]).





In
      a
      lease agreement for SuperStock Limited in the UK, the Company has sublet the
      entire facility to a third party as of June 2002 until the expiration of the
      lease in 2014. In accordance with the lease agreement, SuperStock Limited would
      be liable for £51,000 per year under the covenants in the lease in the event the
      company who has sublet the facility is unable to perform under such
      terms.





[3]
      Litigation and settlement of claims:





The
      Company has been involved in various claims and lawsuits, primarily with former
      officers and employees, both for and against the Company. Management believes
      that there are no such matters outstanding that would have a material adverse
      effect on the Company's results of operations and financial position.




[4]
      Employment Agreements:




On
      May
      13, 2005, a21 executed an employment agreement with its Chairman and Chief
      Executive Officer. On May 13, 2005, a21 and SuperStock executed employment
      agreements with a21’s Vice Chairman, President and Chief Financial Officer, who
      is also the Chief Executive Officer of SuperStock, and a21’s Chief Creative
      Officer, who is also the President and Chief Creative Officer of SuperStock.
      Each of these employment agreements is for a term of three years and includes
      a
      confidentiality covenant, a non-competition covenant and a post-termination
      prohibition on the solicitation of the employees, suppliers, vendors and
      customers of a21 and SuperStock.








-
          21
          -
 a21,
            Inc. and Subsidiaries (Unaudited)
 Notes
            to Condensed Consolidated Financial Statements
 September
            30, 2005





In
      connection with executing these employment agreements, effective as of May
      1,
      2005, the Company issued an aggregate of 2,410,000 shares of its restricted
      common stock to these executive officers, of which 1,187,500 are subject to
      repurchase, at the Company’s option, by the Company at $.01 per share as of
      September 30, 2005, and granted five-year stock options to purchase 2,000,000
      shares of common stock, which are exercisable at $0.30 per share and fully
      vest
      by February 28, 2007. As of May 1, 2005, the Company issued to its non-employee
      directors 510,000 shares of its restricted common stock, of which 67,500 are
      subject to repurchase, at the Company’s option, by the Company at $.01 per share
      as of September 30, 2005, and granted to these directors five-year stock options
      to purchase 510,000 shares of common stock, which are exercisable at $0.30
      per
      share and fully vest by December 1, 2005. As of June 13, 2005, the Company
      issued to a new non-employee director 95,000 shares of its restricted common
      stock, of which 75,000 are subject to repurchase, at the Company’s option, by
      the Company at $.01 per share as of September 30, 2005, and granted to this
      director a five-year stock option to purchase 95,000 shares of common stock,
      which are exercisable at $0.30 per share and fully vest by December 1, 2006.
      See
      Note J[1] for the effect of issuing the restricted common stock.





**NOTE
      L - SUBSEQUENT EVENTS**





[1]
      Equity Transactions:





On
      October 4, 2005 the Company completed a financing pursuant to which it raised
      approximately $3,166,000. The financing involved the sale to ten “accredited
      investors” by a significant stockholder of the Company of outstanding warrants
      to purchase 21,114,000 shares of the Company’s common stock. The exercise price
      with respect to 17,114,000 shares had been reduced to $0.185 per share
      for
      two days commencing with the sale to the investors. The buyers exercised the
      warrants at the reduced price. Most of the proceeds from this transaction were
      used in consummating the acquisition of Ingram Publishing described in Note
      L[2]
      below.





As
      part
      of this financing, a21 amended and restated the remaining warrant to purchase
      4,000,000 shares of a21 common stock. Pursuant to this warrant, the exercise
      price is a minimum of $0.25 per share, subject to adjustment based on, among
      other things, a five-date volume weighted average price and whether the shares
      underlying this warrant are eligible for resale pursuant to a registration
      statement under the Securities Act of 1933.





[2]
      Acquisition of Ingram Publishing:





On
      October 12, 2005 the Company completed the acquisition of all of the outstanding
      stock of Ingram Publishing Limited (“Ingram”) from its stockholders. In
      consideration for the outstanding stock of Ingram, Ingram’s stockholders
      received $965,000 in cash, 3,620,000 shares of a21 common stock and $1,448,000
      in preferred stock that is convertible into shares of the Company’s common stock
      at a minimum price of $0.50 per share. The purchase price is subject to
      adjustments based on Ingram’s closing balance sheet. In addition, the Company
      repaid a $1,548,000 credit facility of Ingram and other Ingram debt and
      transaction costs of $287,000.





-
          22
          -


[3]
      Employment Agreement:





On
      October 19, 2005, a21 and SuperStock entered a three-year employment agreement
      with SuperStock’s Executive Vice President and Chief Financial Officer, which
      includes a confidentiality covenant, a non-competition covenant and a
      prohibition on the solicitation of the employees, suppliers, vendors and
      customers of a21 and SuperStock. In connection with executing the employment
      agreement, the Company issued 175,000 shares of restricted common stock, and
      granted a five-year stock option to purchase 300,000 shares of a21 common stock
      exercisable at $0.30 per share. The restricted shares and options fully vest
      by
      February 28, 2007.





[4]
      Additional Financing





On
      November 17, 2005 the Company entered into a loan agreement with two of its
      current investors whereby the Company issued two promissory notes for a $690,000
      aggregate principal amount and received from the investors two certificates
      of
      deposit (“CDs”) in like amounts. These certificates will replace the current
      deposits maintained by the Company that secure the letter of credit issued
      in
      lieu of the security deposit required under the capital lease agreement for
      the
      Company’s headquarters (see Notes B[7] and I). The loan and the CDs both carry a
      term of three years. In addition to the interest on the loan, which is
      equivalent to the interest earned on the CDs plus 10% payable annually, the
      investors will receive 200,000 shares of the Company’s common stock. The loan,
      which was obtained as a means of providing additional liquidity to the Company,
      is subordinate to the senior secured notes (see Note H[3]).





-
          23
          -





**ITEM
      2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS**





*The
      following discussion should be read in conjunction with the information
      contained in our financial statements and the notes thereto appearing elsewhere
      herein and in conjunction with the Management’s Discussion and Analysis set
      forth in our Annual Report on Form 10-KSB/A for the year ended December 31,
      2004.*








**PRELIMINARY
      NOTE REGARDING FORWARD-LOOKING STATEMENTS**





The
      statements contained in this Form 10-QSB that are not purely historical are
      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. These include statements about our expectations, beliefs, intentions
      or strategies for the future, which are indicated by words or phrases such
      as
“anticipate,”“expect,”“intend,”“plan,”“will,”“we believe,”“management believes”
      and similar words or phrases. The forward-looking statements are based on our
      current expectations and are subject to certain risks, uncertainties and
      assumptions. The Company’s actual results could differ materially from results
      anticipated in these forward-looking statements. All forward-looking statements
      included in this document are based on information available to us on the date
      hereof, and we assume no obligation to update any such forward-looking
      statements.





**OVERVIEW**





a21,
      Inc.
      was incorporated in the State of Texas in October 1998, under the name Saratoga
      Holdings I, Inc. In February 2004, we completed the acquisition of all of the
      voting common stock, representing 83% of the outstanding equity, of SuperStock,
      Inc. Through our subsidiary, SuperStock, we aggregate visual content from
      photographers, photography agencies, archives, libraries and private collections
      and license the visual content to our customers. Our customer base consists
      of
      four major groups: creative (advertising and design agencies), editorial
      (publishing and media entities), corporate (in-house communications departments
      and outside corporate communications firms) and consumers (the general public).
      Our products are sold directly and through a global network of distributors
      in
      approximately 100 countries. We are headquartered in Jacksonville, Florida,
      operate a Company-owned office in the United Kingdom, and conduct operations
      in
      Canada.





**CRITICAL
      ACCOUNTING POLICIES AND ESTIMATES**





This
      discussion and analysis of our financial condition and results of operations
      are
      based on our financial statements that have been prepared under accounting
      principles generally accepted in the United States of America (“GAAP”). The
      preparation of financial statements in conformity with GAAP requires our
      management to make estimates and assumptions that affect the reported amounts
      of
      assets and liabilities and the disclosure of contingent assets and liabilities
      at the date of the financial statements and the reported amounts of revenue
      and
      expenses during the reporting period. Actual results could materially differ
      from those estimates. We have summarized significant accounting policies in
      Note
      B to the condensed consolidated financial statements included in this quarterly
      report on Form 10-QSB.








-
          24
          -





**RESULTS
      OF OPERATIONS**





**THREE
      MONTHS ENDED SEPTEMBER 30, 2005 COMPARED TO THREE MONTHS ENDED SEPTEMBER 30,
      2004**





REVENUES.
      Revenues were $2,064,000 in the three months ended September 30, 2005 compared
      to $2,077,000 in the three months ended September 30, 2004. A decrease in sales
      from our UK and Canadian operations was offset by an increase in U.S. sales,
      while sales of foreign distributors remained constant. A key factor contributing
      to the decline in revenues for the Company’s UK office was the delay in
      implemention of a new e-commerce enabled web site through which our UK customers
      can order our products. We have increased marketing efforts and expenses in
      the
      three months ended September 30, 2005 as compared to the same period in 2004
      in
      an effort to increase revenues both internationally and domestically.





GROSS
      PROFIT. Gross profit was $1,395,000 in the three months ended September 30,
      2005
      compared to $1,467,000 in the three months ended September 30, 2004. As a
      percentage of revenues, gross profit was 68% for the three months ended
      September 30, 2005 and 71% for the three months ended September 30, 2004. Gross
      profit may vary in any period depending on the relative mix of stock photography
      distributed that is either licensed from third parties or owned by us. The
      decrease in gross profit margin is primarily attributable to an increase in
      the
      sale of stock imagery from third parties as compared to stock imagery we
      own.





SELLING,
      GENERAL AND ADMINISTRATIVE EXPENSES. Selling, general and administrative
      expenses (“SG&A”) were $1,997,000 in the three months ended September 30,
      2005 compared to $1,907,000 in the three months ended September 30, 2004. This
      increase was primarily attributable to an increase in marketing expenses for
      existing and newly-created product lines. Marketing expenses were $355,000
      for
      the three months ended September 30, 2005 compared to $232,000 for the three
      months ended September 30, 2004.





DEPRECIATION
      AND AMORTIZATION. Depreciation and amortization was $363,000 in the three months
      ended September 30, 2005 compared to $251,000 in the three months ended
      September 30, 2004. This increase was primarily attributable to the adjustment
      of the purchase price allocation which resulted in a reclassification of assets
      recorded in connection with the acquisition of SuperStock, increasing the
      amortization expense recognized in the three month period ended September 30,
      2005.





NET
      INTEREST EXPENSE. Net interest expense was $316,000 in the three months ended
      September 30, 2005 compared to $522,000 in the three months ended September
      30,
      2004. This decrease is primarily attributable to the payment of our convertible
      subordinated notes in February 2005.




NET
      LOSS.
      Net loss was $1,343,000, or $0.03 per share, in the three months ended September
      30, 2005 compared to net loss of $1,046,000, or $0.03 per share, in the three
      month period ended September 30, 2004. The increase in net loss is principally
      due to the income tax benefit of $280,000 we recorded in the three month period
      ended September 30, 2004, which resulted from the sale of the SuperStock land
      and building.





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**NINE
      MONTHS ENDED SEPTEMBER 30, 2005 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30,
      2004**





Prior
      to
      the acquisition of SuperStock in February 2004, we were a development stage
      company. All financial information presented for the nine months ended September
      30, 2004 includes the accounts of SuperStock from the acquisition date of
      February 29, 2004 through September 30, 2004.





REVENUES.
      Revenues were $6,703,000 in the nine months ended September 30, 2005 compared
      to
      $5,402,000 in the nine months ended September 30, 2004. The increase in revenues
      in the nine months ended September 30, 2005 was attributable to our subsidiary,
      SuperStock, generating revenue for the full nine months ended September 30,
      2005
      compared to 2004, which includes only seven months of SuperStock operations.





GROSS
      PROFIT. Gross profit was $4,606,000 in the nine months ended September 30,
      2005
      compared to $3,805,000 in the nine months ended September 30, 2004. This
      increase was attributable to a full nine months of gross profit for SuperStock
      for the nine months ended September 30, 2005 compared to 2004, which includes
      only seven months of SuperStock operations. As a percentage of revenues, gross
      profit was 69% and 70% in the nine months ended September 30, 2005 and 2004,
      respectively. Gross profit as a percentage of revenues may vary in any period
      depending on the relative mix of stock photography distributed that is either
      licensed from third parties or owned by the Company. The decrease in gross
      profit margin is primarily attributable to an increase in the sale of stock
      imagery from third parties as compared to stock imagery we own.





SELLING,
      GENERAL AND ADMINISTRATIVE EXPENSES. SG&A expenses were $5,517,000 in the
      nine months ended September 30, 2005 compared to $4,305,000 in the nine months
      ended September 30, 2004. This increase was primarily attributable to SG&A
      expenses for SuperStock for the full nine months ended September 30, 2005
      compared to 2004, which includes only seven months of SuperStock
      operations.





DEPRECIATION
      AND AMORTIZATION. Depreciation and amortization was $1,075,000 in the nine
      months ended September 30, 2005 compared to $675,000 in the nine months ended
      September 30, 2004. This increase was primarily attributable to the adjustment
      of the purchase price allocation recorded in connection with the acquisition
      of
      SuperStock, which increased the book value of certain tangible and intangible
      assets and resulted in an increase in related depreciation and amortization
      expense that was recognized in the nine month period ended September 30, 2005
      as
      compared to the nine month period ended September 30, 2004. In addition,
      depreciation and amortization expenses include the full nine months ended
      September 30, 2005 compared to 2004, which includes only seven months of
      SuperStock operations.




NET
      INTEREST EXPENSE. Net interest expense was $1,045,000 in the nine months ended
      September 30, 2005 compared to $1,041,000 in the nine months ended September
      30,
      2004. Interest expense in the nine months ended September 30, 2005 is primarily
      attributable to interest recorded in connection with the lease of the SuperStock
      facility, the senior secured notes and the unsecured notes. Interest expense
      in
      the nine months ended September 30, 2004 is primarily attributable to
      amortization of debt discount and interest in connection with the convertible
      subordinated notes repaid in February 2005, notes due to the sellers of
      SuperStock repaid in June 2004, the note which was secured by the Company’s
      facility repaid in June 2004, and the unsecured notes.





OTHER
      EXPENSE, NET. Other expense, net was $279,000 for the nine months ended
      September 30, 2005 compared to $61,000 in the nine months ended September 30,
      2004. The increase in other expenses reflects a $371,000 loss on the
      extinguishment of the convertible subordinated notes payable.








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          26
          -





NET
      LOSS.
      Net loss was $3,310,000, or $0.08 per share, in the nine months ended September
      30, 2005 compared to $1,997,000, or $0.06 per share, in the nine month period
      ended September 30, 2004. The increase in net loss is principally due to an
      increase in SG&A expenses without a corresponding increase in revenues, an
      increase in depreciation expense, and a loss on extinguishment of debt of
      $371,000.





**LIQUIDITY
      AND CAPITAL RESOURCES**





As
      of
      September 30, 2005, the Company had $1,157,000 of cash and cash equivalents
      and
      a working capital deficit of $1,028,000, compared to $717,000 in cash and a
      working capital deficit of $91,000 at December 31, 2004. The increase in cash
      is
      due to the proceeds from the sale of the Company’s common stock during the three
      months ended September 30, 2005. The increase in working capital deficit is
      attributable to the increase in the current portion of the unsecured
      notes.





Net
      cash
      used in operating activities for the nine months ended September 30, 2005 was
      $1,582,000, compared to net cash used in operating activities of $1,457,000
      for
      the nine months ended September 30, 2004. The net cash used in operating
      activities in the nine months ended September 30, 2005 was due primarily to
      the
      net loss of $3,310,000 and an increase in accounts receivable of $331,000,
      adjusted for $1,075,000 of depreciation and amortization and a $371,000 loss
      on
      extinguishment of the beneficial conversion feature. The increase in receivables
      was primarily due to an increase in long-term accounts receivable from the
      subtenant at the Company’s headquarters for the nine months ended September 30,
      2005. Net cash used in operating activities in the nine months ended September
      30, 2004 was principally due to a net loss of $1,997,000 and a decrease in
      deferred income taxes, net of $385,000, adjusted for $675,000 of depreciation
      and amortization, $209,000 of non-cash compensation from the issuance of options
      and warrants, and $615,000 of amortization of debt discount related to notes
      payable, in addition to an increase in restricted cash of $600,000 and a
      decrease in accounts payable and accrued expenses of $236,000.





Net
      cash
      used in investing activities for the nine months ended September 30, 2005 was
      $287,000, compared to net cash used in investing activities for the nine months
      ended September 30, 2004 of $1,711,000. Net cash used in investing activities
      in
      the nine months ended September 30, 2005 was primarily due to the additions
      to
      leasehold improvements of $232,000 and purchase of property and equipment of
      $46,000. Net cash used in investing activities in the nine months ended
      September 30, 2004 was from the net cash investment in the acquisition of
      SuperStock, in the amount of $1,417,000 and the purchase of property and
      equipment of $294,000.





Net
      cash
      provided by financing activities for the nine months ended September 30, 2005
      was $2,194,000, compared to net cash provided by financing activities of
      $4,557,000 for the nine months ended September 30, 2004. Net cash provided
      by
      financing activities in the nine months ended September 30, 2005 was mainly
      due
      to the new $2,250,000 senior secured notes partially offset by the retirement
      of
      the $1,250,000 convertible subordinated notes (see Note H), and net proceeds
      of
      $1,204,000 in connection with the issuance of common stock. Net cash provided
      by
      financing activities in the nine months ended September 30, 2004 was primarily
      from net proceeds of $7,516,000 from the sale of the land and building, and
      net
      proceeds of $2,790,000 in connection with the issuance of common stock and
      warrants, proceeds of $2,300,000 from the issuance of notes payable and
      warrants, which was partially offset by the repayment of the building mortgage
      of $4,554,000, repayment of the revolving credit line of $1,700,000 and the
      repayment of $1,736,000 of debt.








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          -





On
        October 4, 2005 the Company completed a financing pursuant to which it raised
        approximately $3,166,000. The financing involved the sale to ten “accredited
        investors” by a significant stockholder of the Company of outstanding warrants
        to purchase 21,114,000 shares of the Company’s common stock. The exercise price
        with respect to 17,114,000 shares had been reduced to $0.185 per share for
        two
        days commencing with the sale to the investors. The buyers exercised the
        warrants at the reduced price. Most of the proceeds from this transaction
        were
        used in consummating the acquisition of Ingram Publishing. The Company intends
        to raise additional capital through financings by the issuance of debt, equity
        or other potential transactions to support the Company’s business plan for
        internal growth and growth by acquisitions.





On
      November 17, 2005 the Company entered into a loan agreement with two of its
      current investors whereby the Company issued two promissory notes for a $690,000
      aggregate principal amount and received from the investors two certificates
      of
      deposit (“CDs”) in like amounts. These certificates will replace the current
      deposits maintained by the Company that secure the letter of credit issued
      in
      lieu of the security deposit required under the capital lease agreement for
      the
      Company’s headquarters (see Notes B[7] and I). The loan and the CDs both carry a
      term of three years. In addition to the interest on the loan, which is
      equivalent to the interest earned on the CDs plus 10% payable annually, the
      investors will receive 200,000 shares of the Company’s common stock. The loan,
      which was obtained as a means of providing additional liquidity to the Company,
      is subordinate to the senior secured notes (see Note H[3]).





While
      the
      Company believes that the amount of its current capital will be sufficient
      for
      the next twelve months based on its current internal growth plan, the Company
      will need to raise additional capital to conclude any potential growth by
      acquisitions and to retire its unsecured notes which mature on July 15, 2006.
      Because the assumptions upon which its business plan was based are subject
      to
      change, there can be no guarantee that the Company will have sufficient capital
      or will be able to obtain sufficient capital to execute its business
      plan. Additionally, if the Company needs to secure additional capital
      to
      fund its business plan, there can be no guarantee that the Company will be
      successful in closing any debt, equity or other potential transactions on terms
      favorable to the Company, if at all.




**OFF-BALANCE
      SHEET ARRANGEMENTS**





The
      Company does not have any off-balance sheet arrangements.




**RECENTLY
      ISSUED ACCOUNTING PRONOUNCEMENTS**





The
      Company does not believe that any recently issued, but not yet effective,
      accounting standards if currently adopted would have a material effect on the
      accompanying financial statements.




**ITEM
      3. CONTROLS AND PROCEDURES**





**EVALUATION
      OF DISCLOSURE CONTROLS AND PROCEDURES**





The
      Company maintains disclosure controls and procedures, as defined in Rules
      13a-15(e) and 14d-15(e) of the Securities Exchange Act of 1934 (the “Exchange
      Act”), that are designed to ensure that information required to be disclosed in
      its Exchange Act reports is recorded, processed, summarized and reported within
      the time periods specified in the Securities and Exchange Commission’s rules and
      forms, and that such information is accumulated and communicated to the
      Company’s management, including its principal executive officer and principal
      financial officer, as appropriate, to allow timely decisions regarding required
      disclosure.








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          28
          -





Under
      the
      supervision and with the participation of the Company's management, including
      its principal executive officer and the principal financial officer, the Company
      conducted an evaluation of the effectiveness of the design and operation of
      its
      disclosure controls and procedures as of the end of the period covered by this
      report (the “Evaluation Date”). Based on this evaluation, the Company's
      principal executive officer and principal financial officer concluded that
      as of
      the Evaluation Date, the Company's disclosure controls and procedures were
      not
      effective at ensuring that the material information required to be disclosed
      in
      the Company’s Exchange Act reports is recorded, processed, summarized and
      reported as required in applicable SEC rules and forms because of the
      deficiencies in internal controls over financial reporting described
      below.




The
      Company identified a material weakness in the design or operation of internal
      controls that could adversely affect its ability to record, process, summarize
      and report interim financial data. The material weakness identified pertains
      specifically to the recording of convertible debt instruments and deferred
      tax
      assets. As a result of the material weaknesses in connection with recording
      convertible debt instruments (which instruments were repaid in the first quarter
      2005) and deferred tax assets, the Company filed an amendment to its annual
      report on Form 10-KSB for the year ended 2004 and its quarterly report on Form
      10-QSB for the quarter ended March 31, 2005.




Upon
      determining that there were material weaknesses in its disclosure controls
      and
      procedures, specifically its internal controls over financial reporting, the
      Company’s management, with the oversight of its Audit Committee, commenced an
      assessment of the factors that contributed to such weaknesses and the steps
      required to remediate the Company’s internal control over financial reporting.
      In addition to its independent accountants, the Company retained an independent
      professional resource firm to assist it in various financial reporting
      functions, including assessing the adequacy of its disclosure controls and
      procedures. To enhance its staff’s financial accounting and reporting
      capabilities, the Company plans to increase the size of its financial staff
      by
      retaining experienced personnel as well as providing such staff with additional
      training in public company reporting. By December 31, 2005, the Company plans
      to
      complete its assessment of the material weaknesses in its disclosure controls
      and procedures.





There
      were no changes in the Company's internal control over financial reporting
      during the quarter ended September 30, 2005 that materially affected, or is
      reasonably likely to materially affect, the Company’s internal control over
      financial reporting.








**PART
      II - OTHER INFORMATION ITEM**





**ITEM
      1. LEGAL PROCEEDINGS**





We
      are
      involved from time to time in litigation that arises in the ordinary course
      of
      our business. We believe that any potential adverse determination in any pending
      action will not have a material adverse effect on our business, financial
      condition or results of operations.





**ITEM
      2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
      PROCEEDS**





On
      September 21, 2005, a21 entered into subscription agreements with investors
      whereby the investors purchased an aggregate of 1,000,000 shares of the a21’s
      common stock, par value $0.001 per share (the “Shares”) at a purchase price of
      $0.15 per share, or an aggregate purchase price of $150,000. The Shares were
      sold in reliance on the exemption from registration provided in Section 4(2)
      of
      the Securities Act of 1933, as amended.








-
          29
          -





**ITEM
      3. DEFAULTS UPON SENIOR SECURITIES**





None





**ITEM
      4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**





None





**ITEM
      5. OTHER INFORMATION**





None





**ITEM
      6. EXHIBITS**





The
      following exhibits are filed as part of this report:





**EXHIBIT****NUMBER**
              **DESCRIPTION**31.1*
              Certification
                  of Principal Executive Officer Pursuant to Section 302 of the
                  Sarbanes-Oxley Act of 2002.31.2*
              Certification
                  of Principal Financial Officer Pursuant to Section 302 of the
                  Sarbanes-Oxley Act of 2002.32.1*
              Certification
                  of Principal Executive Officer and Principal Financial Officer
                  Pursuant to
                  Section 906 of the Sarbanes-Oxley Act of
                  2002.


*
        Filed
        herewith





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          30
          -





**SIGNATURES**








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










**a21,
                Inc.**Date:
                November 28, 2005
            By:
                /s/ ALBERT H. PLEUSAlbert
                H. Pleus
              Chairman
                and Chief Executive Officer
              (Principal
                Executive Officer)Date:
                November 28, 2005
            By:
                /s/ THOMAS V. BUTTAThomas
                V. Butta
              Vice
                Chairman, President and Chief Financial Officer
              (Principal
                Financial Officer)








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