UNITED STATES
                       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, 2004.

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
  Act of 1934 For the transition period from _______________ to ______________

                         Commission File Number: 0-18412

                          REZCONNECT TECHNOLOGIES, INC.
             (Exact name of registrant as specified in its charter)

                                    New York
         (State or other jurisdiction of incorporation or organization)

                                   11-2602120
                      (IRS Employer Identification Number)

              560 Sylvan Avenue, Englewood Cliffs, New Jersey 07632
                    (Address of principal executive offices)

                                 (201) 567-8500
              (Registrant's telephone number, including area code)

                                       N/A
              (Former name, former address and former fiscal year,
                          if changed since last report)

                  Number of Shares Outstanding of Common Stock,
           $.001 Par Value, Shares as of September 30,2004 11,351,845


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


<PAGE>






                          REZConnect Technologies, Inc.
                                   FORM 10-QSB
                      NINE MONTHS ENDED SEPTEMBER 30, 2004
                                TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION                                              Page
                                                                            ----

Item 1.  Financial Statements (unaudited)
           Condensed Balance Sheets ...........................................2
           Condensed Statements of Operations..................................3
           Condensed Statements of Cash Flows..................................4
           Notes To Condensed Financial Statements ............................6

Item 2.  Management's Discussion and Analysis of
         Financial Condition and Results of Operations........................18

Item 3.  Controls and Procedures..............................................21

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings          ..........................................21
Item 2.  Changes in Securities and Use of Proceeds............................21
Item 3.  Defaults Upon Senior Securities......................................21
Item 4.  Submission of Matters to a Vote of Security Holders..................21
Item 5.  Other Information          ..........................................21
Item 6.  Exhibits and Reports on Form 8-K.....................................21
            Signatures........................................................22
            Certifications......................................................





<PAGE>









                          REZCONNECT TECHNOLOGIES, INC.

                              FINANCIAL STATEMENTS

                           NINE AND THREE MONTHS ENDED
                           SEPTEMBER 30, 2004 AND 2003
                                   (UNAUDITED)










<PAGE>


                          REZCONNECT TECHNOLOGIES, INC.

                                TABLE OF CONTENTS

                                NINE MONTHS ENDED

                               SEPTEMBER 30, 2004


                                                                         Page
                                                                         ----

Accountants' Report                                                       1

Financial Statements

    Balance Sheets                                                        2

    Statements of Operations                                              3

    Statements of Cash Flows                                              4

Notes to Financial Statements                                             5 - 17

<PAGE>


<TABLE>
<CAPTION>





                         REZCONNECT TECHNOLOGIES, INC.
                                 BALANCE SHEETS
                    SEPTEMBER 30, 2004 AND DECEMBER 31, 2003


<S>                                                                  <C>           <C>
                    ASSETS
                                                                       Sep 30, 04    Dec 31, 03
                                                                      -----------    -----------

CURRENT ASSETS
       Cash .......................................................   $    21,125    $    62,718
       Short-term investments .....................................       611,636        732,135
       Accounts receivable, less allowance for doubtful
             accounts of $65,009 and $4,061) ......................       306,217        255,244
       Interest receivable ........................................        11,536           -
       Loan receivable ............................................        50,000           -
       Current portion of notes receivable ........................       121,021        112,490
       Prepaid expense and other current asset ....................         3,777
                                                                      -----------    -----------
TOTAL CURRENT ASSETS ..............................................     1,125,312      1,162,587

OTHER ASSETS
       Capitalized software costs, at cost less accumulated
             amortization of $92,556 and $54,557
             as of September 30, 2004 and December 31, 2003 .......        83,083         72,469
       Notes receivable, less current portion .....................       685,788        637,444
       Security deposits receivable and other assets ..............        10,460         13,133
                                                                      -----------    -----------
TOTAL OTHER ASSETS ................................................       779,331        723,046
                                                                      -----------    -----------

TOTAL ASSETS ......................................................   $ 1,904,643    $ 1,885,633
                                                                      ===========    ===========

                LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
       Accounts payable and accrued expenses ......................   $   128,814    $   105,776
       Current maturities of long term debt .......................         6,780         20,368
       Deferred revenue ...........................................       118,192        112,490
                                                                      -----------    -----------
TOTAL CURRENT LIABILITIES .........................................       253,786        238,634

OTHER LIABILITIES
       Long term debt, less current maturities ....................       340,550        300,802
       Deferred revenue ...........................................       620,500        632,862
       Security deposits payable ..................................        20,920         26,266
                                                                      -----------    -----------
TOTAL OTHER LIABILITIES ...........................................       981,970        959,930
                                                                      -----------    -----------

TOTAL LIABILITIES .................................................     1,235,756      1,198,564

STOCKHOLDERS' EQUITY
       Common stock, par value $.001, 20,000,000 shares authorized,
           10,462,983 shares issue and outstanding ................        10,462         10,462
       Additional paid-in capital .................................     6,439,863      6,439,863
       Accumulated deficit ........................................    (5,784,040)    (5,763,256)
       Net unrealized gains on marketable securities ..............         2,602           -
                                                                      -----------    -----------
TOTAL STOCKHOLDERS' EQUITY ........................................       668,887        687,069

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ........................   $ 1,904,643    $ 1,885,633
                                                                      ===========    ===========

</TABLE>


                         See Accountants' Review Report



                                       (2)


<PAGE>
                          REZCONNECT TECHNOLOGIES, INC.
                            STATEMENTS OF OPERATIONS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003



                                                  Sep 30, 04      Sep 30, 03
                                                 ------------    ------------

REVENUE
      Franchise fees .........................   $     95,493    $     64,016
      Franchise service fees and other .......        407,817         350,657
      Travel products and services ...........      1,537,572         999,540
      Online travel income ...................        383,179         181,430
      Advertising and other ..................          2,349            -
                                                 ------------    ------------
                                                    2,426,410       1,595,643
INCOME BEFORE SELLING, GENERAL AND
      ADMINISTRATIVE EXPENSES ................      2,426,410       1,595,643

OPERATING EXPENSES
      Cost of travel services and products ...      1,457,189         820,990
      Depreciation and amortization ..........         37,999         366,444
      Franchise services and products ........        194,925            -
      Marketing and selling ..................         83,970          51,709
      General and administrative expenses ....        679,507         685,526
                                                 ------------    ------------
TOTAL OPERATING EXPENSES .....................      2,453,590       1,924,669

LOSS FROM OPERATIONS .........................        (27,180)       (329,026)

OTHER INCOME (EXPENSE)
      Loss from sale of short-term investments         (5,191)           -
      Interest and dividend income ...........         29,443          15,249
      Interest expense .......................        (16,185)           -
                                                 ------------    ------------
TOTAL OTHER INCOME (EXPENSE), NET ............          8,067          15,249
                                                 ------------    ------------

INCOME BEFORE INCOME TAXES ...................        (19,113)       (313,777)

INCOME TAXES .................................          1,670            -
                                                 ------------    ------------

NET LOSS .....................................        (20,783)       (313,777)

PREFERRED STOCK DIVIDENDS ....................           -               -
                                                 ------------    ------------

NET LOSS APPLICABLE TO COMMON STOCKHOLDERS ...   $    (20,783)   $   (313,777)
                                                 ============    ============

EARNINGS (LOSS) PER SHARE:
      WEIGHTED AVERAGE COMMON SHARES
             OUTSTANDING .....................      9,912,983      10,227,788
                                                 ============    ============

BASIC AND DILUTED LOSS PER SHARE .............   $      (0.00)   $      (0.03)
                                                 ============    ============


                         See Accountants' Review Report



                                       (3)

<PAGE>
<TABLE>
<CAPTION>

                          REZCONNECT TECHNOLOGIES, INC.
                            STATEMENTS OF OPERATIONS
             NINE MONTHS AND THREE ENDED SEPTEMBER 30, 2004 AND 2003





                                                              Three Months Ended              Nine Months Ended
                                                              September 30, 2004              September 30, 2004
                                                       --------------------------------------------------------------
                                                             2003            2004            2003            2004
                                                             ----            ----            ----            ----
<S>                                                    <C>             <C>             <C>             <C>

REVENUE
     Franchise fees ................................   $      9,150    $     40,891    $     64,016    $     95,493
     Franchise service fees and other ..............        111,925         116,704         350,657         407,817
     Travel products and services ..................        290,095         644,318         999,540       1,537,572
     Online travel income ..........................         72,641         150,964         181,430         383,179
     Advertising and other .........................           -               -               -              2,349
                                                       ------------    ------------    ------------    ------------
                                                            483,811         952,877       1,595,643       2,426,410
INCOME BEFORE SELLING, GENERAL AND
     ADMINISTRATIVE EXPENSES .......................        483,811         952,877       1,595,643       2,426,410

OPERATING EXPENSES
     Cost of travel services and products ..........        250,344         624,360         820,990       1,457,189
     Depreciation and amortization .................        122,148          12,892         366,444          37,999
     Franchise services and products ...............           -            194,925            -            194,925
     Marketing and selling .........................         21,695          53,506          51,709          83,970
     General and administrative expenses ...........        245,433          79,118         685,526         679,507
                                                       ------------    ------------    ------------    ------------
TOTAL OPERATING EXPENSES ...........................        639,620         964,801       1,924,669       2,453,590

LOSS FROM OPERATIONS ...............................       (155,809)        (11,924)       (329,026)        (27,180)

OTHER INCOME (EXPENSE)
     Gain (loss) from sale of short-term investments           -               -               -             (5,191)
     Interest and dividend income ..................          8,463           3,609          15,249          29,443
     Interest expense ..............................           -             (5,776)           -            (16,185)
                                                       ------------    ------------    ------------    ------------
TOTAL OTHER INCOME (EXPENSE), NET ..................          8,463          (2,167)         15,249           8,067
                                                       ------------    ------------    ------------    ------------

INCOME BEFORE INCOME TAXES .........................       (147,346)        (14,091)       (313,777)        (19,113)

INCOME TAXES .......................................           -                924            -              1,670
                                                       ------------    ------------    ------------    ------------

NET LOSS ...........................................       (147,346)        (15,015)       (313,777)        (20,783)

PREFERRED STOCK DIVIDENDS ..........................           -               -               -               -
                                                       ------------    ------------    ------------    ------------

NET LOSS APPLICABLE TO COMMON STOCKHOLDERS .........   $   (147,346)   $    (15,015)   $   (313,777)   $    (20,783)
                                                       ============    ============    ============    ============

EARNINGS (LOSS) PER SHARE:
     WEIGHTED AVERAGE COMMON SHARES
            OUTSTANDING ............................     10,227,788       9,912,983      10,227,788       9,912,983
                                                       ============    ============    ============    ============

BASIC AND DILUTED LOSS PER SHARE ...................   $      (0.01)   $      (0.00)   $      (0.03)   $      (0.00)
                                                       ============    ============    ============    ============
</TABLE>


                         See Accountants' Review Report


                                       (3)



<PAGE>



                         REZCONNECT TECHNOLOGIES, INC.
                            STATEMENTS OF CASH FLOWS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003



<TABLE>
<CAPTION>

                                                                         Sep 30, 04  Sep 30, 03
                                                                         ----------  ----------
<S>                                                                     <C>          <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss ...........................................................   $ (20,783)   $(313,777)
  Adjustments to reconcile net loss to net cash provided (used)
      by operating activities:
          Depreciation and amortization ..............................      37,999      366,444
          Unrealized gain on marketable securities ...................       2,602         -
          Changes in assets and liabilities
              Accounts receivable ....................................     (50,973)       5,005
              Notes receivable .......................................     (56,875)     (41,216)
              Interest receivable ....................................     (11,536)        -
              Security deposits receivable ...........................       2,673        2,513
              Prepaid expense and other current asset ................      (3,777)        -
              Accounts payable and accrued expenses ..................      23,038       18,376
              Security deposits payable ..............................      (5,346)      (8,971)
              Deferrred revenue ......................................      (6,660)      41,216
                                                                         ---------    ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES ............................     (89,638)      69,590

CASH FLOWS FROM INVESTING ACTIVITIES:
          Acquicision of software right and license fee ..............     (48,613)     (54,927)
          Loan advance ...............................................     (50,000)        -
          Redemption (acquisition) of short-term investments .........     120,498      107,054
                                                                         ---------    ---------
NET CASH USED BY INVESTING ACTIVITIES ................................      21,885       52,127

CASH FLOWS FROM FINANCING ACTIVITIES:
          Loan advance from acquisition of software ..................      38,250     (150,000)
          Repayment of note payable ..................................     (12,090)        -
                                                                         ---------    ---------
NET CASH USED BY FINANCING ACTIVITIES ................................      26,160     (150,000)
                                                                         ---------    ---------

NET INCREASE IN CASH .................................................     (41,593)     (28,283)

CASH, BEGINNING OF YEAR ..............................................      62,718       63,318
                                                                         ---------    ---------

CASH, END OF YEAR ....................................................   $  21,125    $  35,035
                                                                         =========    =========




                           NON CASH INVESTING AND FINANCING ACTIVITIES
Issuance of 1,100,000 shares of common stock .........................   $    -       $ 242,000
                                                                         =========    =========
Issuance of 100,000 common shares for for software ...................   $    -       $    -
                                                                         =========    =========
Preferred dividends paid by the issuance of common stock .............   $    -       $    -
                                                                         =========    =========

</TABLE>

                         See Accountants' Review Report



                                       (4)



<PAGE>


                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003


NOTE 1 - NATURE OF OPERATIONS

Rezconnect  Technologies,  Inc.  (the  "Company")  is a  leading  franchisor  of
traditional  "brick  and  mortar"  travel  agencies  as well  as  Internet-based
travel-related services and technology developing unique reservation systems for
the travel  and  entertainment  industry.  The  Company  is also a  full-service
provider  of  discount  travel  products  and  services to the leisure and small
business  traveler.  It operates  the  business  under its trade  names  "Travel
Network",  "Global Travel Network" and "Travel Network Vacation Central" as well
as web sites "Bookmytravel.com".

The Company's operations are comprised of three divisions. The first division is
an extension of its travel  franchise  system.  The extension  markets itself as
REZcity.com,  an online local city guide and online travel store.  The other two
divisions  of  the  Company  include  our  technology   section,   which  builds
reservation systems using proprietary patent pending  applications for suppliers
within the travel  industry.  The 3rd division  builds  online travel stores for
consumers  of travel  agents,  as well as Super Sites for Travel  Agents to book
their clients travel.

All of the Company's franchised operations are independently owned and operated.
All sales of travel  products by the Company are made through its franchisees or
through its  interactive  web site.  Operational  expenses  consist of franchise
system  sales  and  support   personnel,   executive   management   and  minimal
administrative personnel.

The Company is also engaged in the wholesale travel business,  providing product
and services to its franchisees, which it obtains from tour operators and cruise
lines. The Company also operates a retail travel agency.

In 2002,  the Company  signed an  exclusive,  20-year  management  agreement  to
provide travel web site hosting for one of the Company's  clients,  "Your Travel
Biz,  Inc."  (YTB),  a  network  marketing  company  offering  its'  members  an
interactive consumer website from the Company.  Further, all travel arrangements
from the online  sites are  serviced by a division of the  Company.  The Company
host 3912 sites for YTB.

Beginning in 1999,  the Company began  developing  Internet-based  marketing and
technology services.

In recent years, the Company began shifting its operations away from franchising
in order to concentrate on developing its internet travel agency  business.  The
Company's  investments  in software  and  technology  are  directed  towards the
enhancement of its online travel agency.






                         See Accountants' review report


                                       (5)

<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

              NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of accounting
-------------------
The  financial  statements  have been  prepared  in  accordance  with  generally
accepted accounting principles, using the accrual method. Accordingly,  revenues
are recorded in the period in which they are earned and expenses are recorded in
the period in which they are incurred.

Use of estimates
----------------
The preparation of financial  statements in conformity  with generally  accepted
accounting principals requires management to make estimates and assumptions that
affect the  reported  amounts  of assets  and  liabilities  and  disclosures  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.  Significant estimates include
those  related  to  the   recoverability  of  the  advertising   receivable  and
capitalized software costs.

Revenue recognition
-------------------

Franchise Fees
--------------
Payment of an initial  franchise fee, which is due upon execution of a franchise
agreement,  can be in the form of cash, notes or a combination thereof.  Revenue
is deferred until all material services and conditions  required of the company,
prior to the  opening  of the  franchised  business,  have  been  performed  and
substantial doubts of collectibility have been eliminated,  usually upon receipt
of payment.  For the nine  months  ended  September  30,  2004,  the Company has
recognized new franchise sale in the amount of $95,493. Included in this amount,
$58,144 has been deferred against notes receivables.

As of  September  30,  2004,  the Company has taken a reserve  against its notes
receivable and corresponding deferred revenue balance for approximately $237,000
due to non-collection of balances in recent years.

Travel Products and Services
----------------------------
Commissions earned from the sales of travel products and services are recognized
when  earned.  Revenues  earned  from all  other  sales of  travel  and  related
products,  where the Company is the credit card merchant of record, are recorded
when earned at their aggregate retail value. Cancellations have historically not
been material.

Advertising and Other
---------------------
Advertising,  franchise  service fees and other  revenues are recognized as they
become payable.  Other revenue consists  primarily of travel related income from
the operation of a retail travel Service and certain earned commissions.





                         See Accountants' review report


                                      (6)

<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Online Travel Income
--------------------

Online travel  income is recognized  when earned income is recorded on a monthly
basis based on the number of websites hosted.

Concentration of credit risk
----------------------------
The  Company is subject to credit  risk  through  its cash,  trade  receivables,
short-term  investments  and notes payable.  Credit risk with respect to cash is
minimized as the Company  maintains  deposits in accounts insured up to $100,000
by the Federal Deposit Insurance Corporation.  Credit risk with respect to trade
receivables  is minimized due to the nature of its customer base and  geographic
dispersion  of  such   customers.   Short-term   investments  are  placed  in  a
highly-rated mutual bond fund to minimize credit risk.

Financial instruments
---------------------
The Company's  financial  instruments  include cash, trade receivables,  current
maturities  of  notes   receivable  and  payable  for  which  carrying   amounts
approximate   fair  value  due  to  the  relatively   short  maturity  of  these
instruments.   The  carrying  value  of  the  Company's  short-term  investments
approximates fair value based on quoted market prices.

Cash and cash equivalents
-------------------------
Cash and cash  equivalents  include all highly liquid  investments with original
maturities of three months or less when purchased.

Investments in marketable securities
------------------------------------
The Company has adopted  Statement of  Financial  Accounting  Standards  No. 115
(SFAS 115),  "Accounting for Certain Investments in Debt and Equity Securities,"
which requires  certain  investments to be classified  into the following  three
categories:  held-to-maturity  (recorded at amortized cost),  available-for-sale
(recorded at fair value), and trading (recorded at fair value).

The Company  classifies its marketable equity securities as  available-for-sale.
Realized  gains and losses,  determined  using the  first-in,  first-out  (FIFO)
method,  are  included  in  earnings;  unrealized  holding  gains and losses are
reported in other  comprehensive  income under the equity section of the balance
sheet. As of September 30, 2004, the company has unrealized holding gains in the
amount of $2,602.

Goodwill
--------
The excess of cost over net assets acquired  (goodwill) was being amortized on a
straight-line basis over five years.

On January 1, 2002, pursuant to Statement of Financial  Accounting Standards No.
142,  "Goodwill  and Other  Intangible  Assets",  amortization  of goodwill  was
discontinued.



                         See Accountants' review report


                                       (7)
<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

        NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Goodwill(Continued)
-------------------
The Company reviewed the remaining  goodwill  recorded and has deemed it to have
no value based upon current economic  conditions.  Accordingly,  the Company has
recorded a charge for $153,400 to the  franchise and travel  related  management
services segment of the Company.  The following table presents adjusted net loss
and loss per share  data  restated  to  include  the  retroactive  impact of the
adoption of SFAS No. 142 for the year 2003:

                                      2003
                                  -------------
Net loss as reported              $ (1,107,483)
Add back: Goodwill amortization          -
Pro forma net loss                  (1,107,483)
Loss per share as reported               (0.12)
Pro forma loss per share                 (0.12)

Advertising
-----------
The Company expenses advertising costs as incurred.  Advertising expense for the
nine months  ended  September  30, 2004 and 2003 was  approximately  $19,928 and
$7,081, respectively.

Recent Accounting Pronouncements
--------------------------------
In January 2003,  the  Financial  Accounting  Standards  Board  ("FASB")  issued
interpretation  No.  46,  "Consolidation  of  Variable  Interest  Entities  - an
interpretation  of ARB No. 51" ("FIN  46"),  which  addresses  consolidation  of
variable  interest  entities.  FIN 46 expands the criteria for  consideration in
determining  whether a variable  interest  entity  should be  consolidated  by a
business entity, and requires existing unconsolidated variable interest entities
(which include, but are not limited to, Special Purpose Entities, or SPEs) to be
consolidated by their primary  beneficiaries  if the entities do not effectively
disperse risks among parties involved.  This interpretation  applies immediately
to variable  interest  entities  created after January 31, 2003, and to variable
interest entities in which an enterprise obtains an interest after that date. It
applies in the first fiscal year or interim period beginning after September 15,
2003,  to variable  interest  entities in which an  enterprise  holds a variable
interest that it acquired before February 1, 2003. The adoption of FIN 46 is not
expected to have a material  impact on the results of  operations  or  financial
position of the Company.

In May 2003, the FASB issued Statement of Financial Accounting Standard ("SFAS")
No. 149,  "Amendment  of Statement  133 on  Derivative  Instruments  and Hedging
Activities".  SFAS No.  149  amends  and  clarifies  accounting  for  derivative
instruments,   including  certain  derivative   instruments  embedded  in  other
contracts,  and for  hedging  activities  under  SFAS No.  133.  SFAS No. 149 is
effective for contracts  entered into or modified  after  September 30, 2003 and
for hedging  relationships  designed after  September 30, 2003. The Company does
not believe that the adoption of SFAS No. 149 will have a material impact on its
financial statements.


                         See Accountants' review report


                                       (8)

<PAGE>


                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Recent Accounting Pronouncements(Continued)
-------------------------------------------


In May 2003,  the FASB issued SFAS No. 150,  "Accounting  for Certain  Financial
Instruments with  Characteristics  of both Liabilities and Equity." SFAS No. 150
established  standards for how companies classify and measures certain financial
instruments with characteristics of both liabilities and equity.

It requires  companies  to classify a  financial  instrument  that is within its
scope  as a  liability  (or an  asset in some  circumstances).  SFAS No.  150 is
effective beginning with the second quarter of fiscal 2004; the Company does not
believe  the  adoption  of SFAS  No.  150 will  have a  material  impact  on its
financial statements.

Accounts receivable and notes receivables
-----------------------------------------
The  Company  reflects  accounts  receivable  and  notes  receivables  at  their
outstanding  principal  balances as of the balance sheet date,  adjusted for any
charge-offs,  allowances.  In both  2004  and  2003,  the  Company  recorded  an
allowance  against its notes  receivables from franchisees and the corresponding
deferred revenue balances, due to the fact that the balances were not paid for a
few  years.  This  adjustment  did not  affect  the  Company's  profit  and loss
statement.  For the nine  months  ended  September  30,  2004,  the  Company has
recorded additional $58,144 notes receivables from new franchisees in connection
with its sales of Rezcity online franchise service.

Profit sharing plan
-------------------
The  Company  sponsors  a defined  contribution  plan.  All  employees  who have
completed  1,000  hours  of  service  during  the  plan  year  may  participate.
Contributions  are accrued and paid out of the Company's  current profits at the
discretion of the Company's Board of Directors.

Employees may make voluntary  contributions,  subject to statutory  limitations.
The Company elected not to make a contribution for 2004 and 2003.

Comprehensive Income
--------------------

The  company  follows  the  provisions  of  Statement  of  Financial  Accounting
Standards No. 130, "Reporting  Comprehensive  Income" ("SFAS No. 130"). SFAS No.
130 establishes rules for reporting and display of comprehensive  income and its
components.

Stock-based compensation
------------------------
Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation"  (SFAS 123) requires that companies with stock-based  compensation
plans  recognize  compensation  expense  based on the  "fair  value"  accounting
method,  or to apply the  "intrinsic  value"  method  provisions  of  Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" (APB
25), and  disclose pro forma net income  assuming the fair value method had been
applied.



                         See Accountants' review report


                                       (9)

<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Stock-based compensation(Continued)
-----------------------------------
The Company has elected to adopt the disclosure-only provisions of SAFS 123 and,
accordingly,  computes  compensation  expense for employees as prescribed by APB
25. Under APB 25,  compensation  cost,  if any, is measured as the excess of the
quoted market price of the Company's  stock at the date of grant over the amount
an employee must pay to acquire the stock.

For stock options  granted to  non-employees,  expense is measured  based on the
fair value method prescribed by SFAS 123.

Earnings (loss) per share
-------------------------
Basic  earnings  (loss) per share are based on the  weighted  average  number of
common shares outstanding.  Diluted earnings (loss) per common share assume that
outstanding  common shares are increased by common shares issuable upon exercise
of stock options and the  conversion of preferred  stock where their exercise or
conversion would be dilutive.  For the nine months ended September 30, 2003, the
effects of assumed  exercise of options and warrants  and/or the  conversion  of
preferred shares would be anti-dilutive.

Capitalized software costs
--------------------------
Pursuant to SOP 98-1,  "Accounting for Costs of Computer  Software  Developed or
Obtained for Internal  Use",  the Company  capitalizes  certain  costs  incurred
during an internal use software development project,  including costs related to
applications,  infrastructure,  and graphics  development  for the Company's web
site.  Capitalized  costs consist of the cost of the software license  agreement
(Note 3), and certain  external direct costs of materials and licensor  provided
services  incurred in  developing  the software  for its specific  applications.
Capitalized  software costs are being  amortized over their expected useful life
of thirty-six months.

Advertising Receivable
----------------------
In January,  2000,  the Company  entered into an  agreement  with a company that
specializes in arranging and brokering the placement of cable advertising. Under
the terms of the  agreement,  the Company  issued  207,289  shares of its common
stock in return  for the  promise by the other  party to  provide  approximately
$2,021,000 of cable  advertising  credits to the Company.  Through  December 31,
2000, the Company  utilized  approximately  $25,000 of such credits.  No credits
were  utilized  in 2002  and  2003.  Advertising  expense  is  charged  when the
advertising credits are utilized. An allowance of $500,000 was taken against the
receivable  balance as of December  31,  2001 due to non-use of the  advertising
credits  and a dispute  with the  vendor  over the terms of the  agreement.  The
Company  discovered  that the  vendor  was no longer in  business.  As such,  an
impairment of $1,496,000 was recorded as of December 31, 2002.

NOTE 3 - SOFTWARE LICENSE AGREEMENT AND DEVELOPMENT COSTS
---------------------------------------------------------

In 1999,  the Company  entered into a four-year  agreement  to license  software
designed  for and  expected  to be  utilized  by the  Company in its  e-commerce
activities. In connection therewith, the

                         See Accountants' review report


                                      (10)

<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

NOTE 3 - SOFTWARE LICENSE AGREEMENT AND DEVELOPMENT COSTS(CONTINUED)
--------------------------------------------------------------------

Company paid the  licensor an  aggregate  of $50,000 in 1999 and 2000  ("initial
installment")  and granted the  licensor  warrants  to acquire an  aggregate  of
217,000  shares  of  the  Company's  common  stock.  The  warrants,   which  are
exercisable at between $4 and $5 per share for four years  (100,000  shares) and
five years (117,000  shares),  respectively,  were valued at an average of $4.40
per share.

Commencing in the year that the software is deemed "available",  as that term is
used in the agreement, the Company was required to pay a license fee of $75,000.
In February  2003,  the Company  reached an agreement with the licensor to waive
the license fee of $75,000 in return for the  issuance  of common  shares  worth
$50,000 at the time of issuance. The Company will then pay the licensor a 4% fee
on all revenue generated from the use of the net-to-phone  technology portion of
the software.

The Company has not generated  any revenue from this  technology.  In 2003,  the
Company elected to take on impairment of the remaining capitalized software cost
and the related  capitalized  consulting cost associated with the development of
the software.

In the  beginning of 2004,  the Company has acquired  software  license right to
conduct its online franchise business.  The total value of this software license
cost is  $45,000.  The  Company  has been  given an option  to make  installment
payment of $9,000 per year for five  years.  The cost of this  software  license
will be amortized  through the five year life.  In August 2004,  the Company has
acquired new software  right in the amount of $3,612.  The cost of this software
right will be amortized over its expected useful life of thirty-six months.

NOTE 4 - LONG TERM DEBT
-----------------------

On January  11,  2002,  as a result of the events of  September  11, the Company
borrowed $324,500 from the United States Small Business Administration under its
disaster relief program. Payments were to commerce in January 2003. However, the
Small Business  Administration  extended the commencement date to November 2003.
The loan is repayable on a monthly  installment of $2,607 including  interest at
4% per annum through October 2017. The loan is guaranteed by the Company's chief
executive officer and is collateralized by the accounts  receivable and property
and equipment of the Company.

Minimum  principal  payments  under long term debt agreement as of September 30,
2004 are as follows:






                         See Accountants' review report


                                      (11)

<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003


NOTE 4 - LONG TERM DEBT(Continued)
----------------------------------


         2004                      $   4,530
         2005                         21,092
         2006                         21,842
         2007                         22,619
         2008                         23,423
         Thereafter                  215,574
                                   ---------



         Total                     $ 309,080
                                   =========

NOTE 5 - COMMIMENTS AND CONTINGENCIES

Leases
------
The Company is  obligated  under an office  lease,  renewed in 2003 and extended
until April 30, 2008, to pay minimum  annual  rentals,  currently at $44,000 per
year plus real estate taxes and operating cost charges.

In addition, the Company has entered into various lease agreements with Wal-Mart
Stores,  Inc.  (Wal-Mart) for 10 locations pursuant to a master lease agreement.
The Company has also entered into sub-lease  agreements with franchisees at many
of these Wal-Mart locations.

The  Company  has an option  to renew  both the  leases  with  Wal-Mart  and the
subleases with the franchisees for a two-year  period and,  additionally,  three
one-year periods.

The  following  is a summary  of net rental  expense,  included  in general  and
administrative  expenses for the nine months ended September 30, 2004, under all
operating leases:

                                      2004
                                      ----

Minimum rentals                  $ 123,081
Less: Sublease rentals             106,438
                                 ---------

Net rental expense               $  16,643
                                 =========

Minimum future rental payments under non-cancelable  operating leases (including
the Wal-Mart location  leases),  having initial terms in excess of one year, are
as follows:





                         See Accountants' review report


                                      (12)
<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

NOTE 5 - COMMIMENTS AND CONTINGENCIES(CONTINUED)
------------------------------------------------

Leases(continued)

                         Headquarter   Wal-Mart Locations
                         -----------   ------------------
         2004            $  11,700       $  31,515
         2005               46,800         126,060
         2006               46,860         126,060
         2007               46,920         126,060
         2008               15,600         126,060
                         ---------       ---------

         Total           $ 167,880       $ 535,755
                         =========       =========

The minimum  future  rentals have not been reduced by  approximately  $12,213 of
monthly  sublease  rentals to be  received  in the future  under  non-cancelable
subleases.


Legal Proceedings
-----------------
The Company is involved in legal  proceedings  incurred in the normal  course of
business. At June 30, 2004 and 2003, in the opinion of management,  there are no
proceedings  that would have a material effect on the financial  position of the
Company if adversely decided.

Employment Agreement
--------------------
During 2000, the Company entered a five-year employment agreement with its Chief
Executive Officer ("CEO").  Pursuant to the agreement, the CEO is paid an annual
base salary of $200,000 per year with annual 6% increases, and a bonus incentive
equal to 10% of all initial franchise fees earned by the Company.  Additionally,
the  agreement  provides  the CEO  certain  rights  in the  event of a change in
control of the Company.

NOTE 6 - STOCKHOLDERS' EQUITY
-----------------------------

Preferred Stock
---------------
During the third quarter of fiscal 2000,  the Company  issued  143,497 shares of
its series A 7% cumulative convertible preferred stock at $7.00 per share. These
shares,  with a par value of $.001,  are  convertible  into two shares of common
stock, subject to adjustment. Also attached to each share of the preferred stock
is a warrant to purchase one share of common  stock at $10.00.  The warrants are
exercisable for a period of up the three years. Total proceeds,  net of issuance
costs,  were $896,178.  The preferred shares had a liquidation  preference of $7
per share.

During 2002, the Company offered its preferred shareholders the right to convert
each of their units into seven shares of common stock.  As of December 31, 2002,
all of the preferred  shares were converted into common shares.  Total dividends
paid on the preferred  stock in 2002 were $35,808.  The $35,808 was paid in 2002
through the issuance of 210,635 common shares.


                         See Accountants' review report


                                      (13)
<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

NOTE 6 - STOCKHOLDERS' EQUITY(CONTINUED)
----------------------------------------

Common Stock Issued
-------------------
During the year ended December 31, 2003 and 2002,  the Company issued  1,100,000
and 819,601 shares of common stock,  respectively,  which were recorded at their
fair value at the time of issuance, as follows:

                            2004                     2003
                  ---------------------    --------------------------
                  No. of Shares  Amount    No. of Shares      Amount
                  =============  ======    =============     ========
Deferred Costs         -         $   -       1,000,000       $ 220,000

On February 11, 2003, the Company's Board of Directors approved and ratified the
issuance of 800,000  shares to Your Travel Biz,  Inc. and 200,000  shares to YTB
Travel and Cruises,  Ltd. In exchange  for an exclusive  contract to service the
Company's web-sites and travel services over a 20-year period. In addition,  the
Company  loaned YTB Travel and Cruised Ltd. and Your Travel Biz, Inc.  $150,000.
$100,000 was provided in cash and the remaining  $50,000 was provided in credits
against monthly billings. The loan was repaid in full in November 2003.

In April and  September  2003,  the  Company  issued  50,000 and  30,000  shares
respectively to a vendor in payment for software development services rendered.

In September 2003,  20,000 shares were issued to a vendor for the creation of an
infomercial.

As of June 30,  2004 and 2003,  common  shares  are  reserved  for  issuance  as
follows:

Warrants                                                  2003           2002
--------                                                  ----           ----
Exercisable at $5.00 per share through December 2004     $217,000       $217,000
Exercisable at $10.00 per share through November 2003        -           143,497

Options
-------
Exercisable at various amounts through 2006 (weighted
 average of $1.08 per share)                             475,000         475,000
                                                        --------        --------

Total                                                   $692,000        $835,497
                                                        ========        ========

A summary of stock option activity and weighted  average  exercise price for the
year ended December 31, 2003 and 2002 are as follows:







                             See Accountants' report


                                      (14)
<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

NOTE 6 - STOCKHOLDERS' EQUITY(CONTINUED)
                                                             Weighted
                                                              Average
                                                Options   Exercise Price
                                                -------   --------------

Outstanding, January 1, 2003                    475,000      $   1.08
  Granted                                             -             -
  Exercised                                           -             -
Forfeited/Cancelled                             -------      --------
Outstanding, December 31, 2003                  475,000      $   1.08
  Granted                                             -             -
  Exercised                                           -             -
Forfeited/Cancelled                             -------      --------
Outstanding, June 30, 2004                      475,000      $   1.08
                                                =======      ========

A summary of stock options  outstanding and exercisable as of September 30, 2004
are as follows:

--------- ------------ --------------- ------------ ------------ ---------------
                             Options   Outstanding   Options     Exercisable
--------- ------------ --------------- ------------ ------------ ---------------
                       Weighted        Weighted                  Weighted
Exercise  Number       Average         Average      Number       Average
Prices    Outstanding  Remaining Life  Exercise     Exercisable  Exercise Price
--------- ------------ --------------- ------------ ------------ ---------------
--------- ------------ --------------- ------------ ------------ ---------------
$1.00     410,000      5 Years         $1.00        351,000      $1.00
--------- ------------ --------------- ------------ ------------ ---------------
$2.00      65,000      5 Years         $2.00         45,000      $2.00
--------- ------------ --------------- ------------ ------------ ---------------
--------- ------------ --------------- ------------ ------------ ---------------

The fair value of the options granted for the years ended December 31, 2003 were
estimated  using the  Black-Scholes  option pricing model based on the following
weighted average assumptions:

                                    2004             2003
                                   ------           ------
Risk free interest rate              5.00%            5.00%
Expected volatility                100.00%          100.00%
Expected remaining lives             2                2
Expected dividend yield             -0-              -0-


Had compensation cost for employee stock options been determined consistent with
SFAS 123, the  Company's  net loss and loss per share would have been as follows
for the six months ended June 30, 2004:



                             See Accountants' report

                                      (15)

<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

NOTE 6 - STOCKHOLDERS' EQUITY(CONTINUED)
----------------------------------------

Net loss as reported                   $ (46,552)
Pro forma net loss                     $ (46,552)
Loss per share as reported             $   (0.00)
Pro forma net loss per share           $   (0.00)

Merger Related items
--------------------
In  connection  with the September  1999 merger with  Playorena,  Inc.,  certain
Playorena  shareholders  agreed to  indemnify  the Company  with  respect to any
amount  paid  or  payable  by  the  Company  on  account  of  certain  Playorena
obligations amounting to approximately  $332,000. The indemnification relates to
any claims made by a potential  creditor within three years from the date of the
merger.  For this  reason,  the  Company did not include  these  obligations  of
Playorena in its financial statements.

In connection  with the above,  former members of al limited  liability  company
that  was  a  predecessor   to  the  Company  were   entitled  to   preferential
distributions of $258,000. The Company issued approximately  1,172,000 shares of
its common stock in April 2003 in payment of the preferential distribution.

NOTE 7 - INCOME TAXES
---------------------
As a result of the  Company's  operating  losses in 2003 and  2002,  no  current
income taxes are provided.

The  Company  has net  deferred  tax assets of  approximately  $2,302,993  which
consists  principally  of the income tax  benefits of net  operating  loss carry
forwards of  approximately  $5,757,483 which begin to expire in 2019. Due to the
Company's  history of operating  losses, a valuation  allowance in the amount of
net deferred assets has been recorded.

NOTE 8 - RELATED PARTY TRANSACTIONS
-----------------------------------
The  Company  pays  consulting  fees to a company  owned by the chief  executive
officer who is a significant shareholder. Expenses totaled approximately $36,000
and 45,000 each for the nine months ended September 30, 2004 and 2003.

NOTE 9 - SEGMENT INFORMATION
----------------------------
The  Company  operates  in  three  business  segments:   providing  and  selling
management   services  within  the  travel   industry,   including   franchising
activities,  developing and commercializing  Internet-based  technology programs
and on-line travel store services.

Summarized financial information concerning the Company's reportable segments is
shown in the following  table.  The "other" column includes  corporate items not
specifically allocated to the segments.



                        See independent auditors' report

                                      (16)


<PAGE>

                          REZCONNECT TECHNOLOGIES, INC.
                          NOTES TO FINANCIAL STATEMENTS
                  NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

NOTE 9 - SEGMENT INFORMATION
----------------------------
<TABLE>
<CAPTION>


---------------------------- ---------------------- --------------- --------------- ------------ -------------
<S>                          <C>                    <C>            <C>             <C>            <C>
     Nine Months Ended       Franchise and Travel        Internet   Online Travel      Other        Total
     September 30,2004        Related Management        Technology      Store
                                   Services              Programs     Services
---------------------------- ---------------------- --------------- --------------- ------------ -------------
Revenues                         2,043,231                 -           383,179          -        2,426,410
---------------------------- ---------------------- --------------- --------------- ------------ -------------
Segment profit (loss)             (316,448)                -           295,665          -          (20,783)
---------------------------- ---------------------- --------------- --------------- ------------ -------------
Total assets                       381,990                83,083       806,809       632,761     1,904,643
---------------------------- ---------------------- --------------- --------------- ------------ -------------
Capital expenditures                50,000                 3,613        45,000          -           98,613
---------------------------- ---------------------- --------------- --------------- ------------ -------------
Depreciation and
amortization                         -                     -            37,999          -           37,999
---------------------------- ---------------------- --------------- --------------- ------------ -------------
Interest income                      -                     -              -           29,443        29,443
---------------------------- ---------------------- --------------- --------------- ------------ -------------



---------------------------- ---------------------- --------------- --------------- ------------ ------------
     Nine Months Ended       Franchise and Travel        Internet   Online Travel      Other        Total
     September 30,2003        Related Management        Technology      Store
                                   Services              Programs     Services
---------------------------- ---------------------- --------------- --------------- ------------ ------------
Revenues                         1,414,213                 -           181,430          -        1,595,643
---------------------------- ---------------------- --------------- --------------- ------------ ------------
Segment profit (loss)             (123,480)             (291,413)       85,567          -         (329,026)
---------------------------- ---------------------- --------------- --------------- ------------ ------------
Total assets                       841,739              628,689        386,128       640,501     2,497,057
---------------------------- ---------------------- --------------- --------------- ------------ ------------
Capital expenditures                -                     -             76,927          -           76,927
---------------------------- ---------------------- --------------- --------------- ------------ ------------
Depreciation and
amortization                        -                    291,413        75,031          -          366,444
---------------------------- ---------------------- --------------- --------------- ------------ ------------
Interest income                     -                      -              -           15,249        15,249
---------------------------- ---------------------- --------------- --------------- ------------ ------------




</TABLE>


                         See Accountants' review report


                                      (17)

<PAGE>








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


                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     REZconnect (R) Technologies, Inc. (the "Company") is a leading franchisor
of traditional "brick and mortar" travel agencies, as well as Internet-based,
travel-related services and technology developing unique reservation systems for
the travel and entertainment industry. We are also a full service provider of
discount travel products and services to the leisure and small business
traveler. We operate the business under our trade names "Travel Network,"
"Global Travel Network" and "Travel Network Vacation Central" as well as, web
sites " "Bookmytravel.com" and "REZconnect.com." We offer our customers a
reliable source of travel products and services through our agreements with
selected travel providers, including major airlines, cruise lines, hotels and
car rental agencies, as well as wholesale travel providers. In addition, we
offer our customers the ability to make reservations on over 424 airlines, at
more than 35,000 hotels and with most major car rental companies, cruise lines
and tour package operators.

     REZconnect (R) Technologies, Inc. (the "Company") operations are comprised
of 3 divisions. The first division is an extension of its travel franchise
system. The extension markets itself as REZcity.com, an online local city guide
and online travel store. The 2nd division of the Company is our technology
section, which builds reservation systems using proprietary patent pending
applications for suppliers within the travel industry. The 3rd division builds
online travel stores for consumers of travel agents, as well as "Super Sites"
for Travel Agents to book their clients travel. REZconnect Technologies, Inc.
has signed contracts with numerous Consortium groups to build online "Super
sites" for their agent base. Contracts that have been signed include: Hickory
Leisure, InteleTravel, OSSN and ARTA.

     REZconnect's consumer driven websites provide strong content and
bookability with over 60 booking engines incorporated into one site, covering
all aspects of the travel industry. Sites are available for use 24 hours, 7 days
a week, allowing travel agents the ability to personally follow-up with the
online consumer and provide customer service.

     REZconnect typically charges $49.95 per month, on a non-contract basis, to
own and operate on an online travel site. If an agent signs a one year contract,
the cost is reduced and the agent only pays for 11 months of service. The
agencies that pay month to month must pay by credit card while yearly contracts
can be paid either by check or credit card.

     Currently, there are over 10,000 consumer websites in operation. Site
owners are permitted to solicit other organizations and associations to clone
travel sites allowing for site owners to earn more revenue. The fee associated
with a travel site clone is $25 per site, monthly.

     REZcity is an online city guide and online travel store for over 53,000
towns throughout the United States providing a unique model for entrepreneurs
and travel agencies to participate by licensing the local community content with
rights to sell advertising and e-commerce solutions. The pricing of a local town
of 25,000 in population is $1,500 for a one-time fee and an annual hosting fee
of $150.00.

     We are the only company in this field offering every postal zip code in the
U.S. with strong rich content provided by over 100 sources, including weather,
entertainment, sports, news, various information guides with yellow page
listings of over 15,000,000 businesses. This site is up and running and was




                                      (18)
<PAGE>

first available in 1998. REZconnect took over the site in 2002 and is currently
offering this product to companies within the travel community.

     To date, REZcity has signed 249 Single Unit franchises, 3 Area
Representative Units and 4 Master Units. A single unit franchise consists of a
single town or zip code with a population of 25,000 or less. Franchisees are
required to sell e-commerce and advertising solutions, to earn revenue, within
their purchased territory and market their website to local residents residing
in the community. An Area Representative owns a minimum of 20 Franchise units in
which he/she is responsible for the same tasks as a single unit franchise owner,
however they represent a larger territory. A Master owns a minimum of 600
Franchise units. A Master's primary role is to sell individual franchise units
and Area Representative Units. A Master earn revenue by Franchise sales as well
as by sales created by franchisees within their master territory selling
e-commerce and advertising solutions.

     Revenues from the sale of Area Representative Units and Master Units
Franchisees are not usually recorded in our financial statement based on our
accounting policy regarding the recognition of franchise revenues until services
have been rendered and substantial doubt of collectability has been eliminated,
usually upon receipt of payment.

     Our brick and mortar franchisee fees range from $3,000 to $29,900 for
domestic franchises and from $50,000 to $350,000 for individual international
territories. Yearly service fees range from $2,000 to $9,000 per location.
Commission rates paid by travel suppliers have been approximately 10% for hotel
reservations, 5-10% for car rentals, and 10-15% for cruises and vacation
packages. Airline tickets are a non-commissionable item and revenues are earned
from service fees, which range from $4 to $15 per ticket.

     In-house sales personnel have generally handled marketing of franchisees.
All of the Company's franchised operations are independently owned and operated.
The Company operates two company-owned travel agencies. All sales of travel
products by the Company are made through its franchisees or through its
interactive web site. Operational expenses consist of franchise system sales and
support personnel, executive management and minimal administrative personnel.

     In 2003, REZconnect signed an exclusive, 20-year management agreement to
provide travel web site hosting for one of the Company's clients, "Your Travel
Biz, Inc." and "YTB Travel And Cruise LTD" (YTB) a network marketing company
offering its' members an interactive consumer website from the Company. Further,
all travel arrangements from the online are serviced by a division of the
Company. We currently host over 8200 sites for YTB. Based on current projects
supplied by YTB, the growth of new sites should increase significantly over the
next several years. In conjunction with the signing of this agreement REZconnect
issued YTB Travel and Cruise Ltd. and Your Travel Biz, Inc., 200,000 and 800,000
shares of stock respectively.

Results of Operations

                      Nine-months ended September 30, 2004
            As compared to the nine-months ended September 30, 2003:

Revenues

     Franchise fees increased by approximately $31,477 in the 2004 nine-month
period as compared to the 2003 nine-month period.


                                      (19)
<PAGE>

     Franchise service fees and other increased by approximately $57,160 or 16%
in the 2004 nine-month period as compared to the 2003 nine-month period. The
increase is attributable to a increase in service fees of RezCity franchisees
and increasing sales of travel worldwide.

     Travel products and services increased by approximately $538,032 or 54% in
the 2004 nine-month period as compared to the 2003 nine-month period. Sales of
travel related products and services are correlated to the number of brick and
mortar franchisees in our system and the general demand for such products and
services.

     Online travel income increased $201,749 or 52% due to the fact the
Company's Consumer website program has grown significantly.

     Advertising and other revenues increased approximately $2,349 or 100% due
to the fact that the Company was not active in this area in 2003.

Expenses

     The cost of travel related products and services increased approximately
$636,199 or 44% in the 2004 nine-month period as compared to the 2003 nine-month
period as a result of higher related revenues. Such costs amounted to
approximately 60% of revenues in the 2004 nine-month period as compared to 40%
of related revenues in the 2003 nine-month period.

     Marketing and selling expenses increased by approximately 38% in 2004
nine-month period as compared to the 2003 period.

     General and administrative expenses decreased by approximately $6,019 or 1%
in the 2004 nine-month period as compared to the 2003 nine-month period. The
decrease relates to a decrease in salaries, which relate to the Company's online
travel business.

     Depreciation and amortization expense declined by approximately $328,445 in
2004 period as compared to the 2003 period, due to the fact that the Company has
written off a major portion of its' capitalized software cost on the 2003
year-end.

Variability of Results

        The Company expects to experience significant fluctuations in its future
quarterly operating results due to a variety of other factors, many of which are
outside the Company's control. Factors that may adversely affect the Company's
quarterly operating results include, but are not limited to, (I) the Company's
ability to retain existing customers, attract new customers at a steady rate and
maintain customer satisfaction, (ii) changes in inventory availability from
third party suppliers or commission rates paid by travel suppliers, (iii) the
announcement or introduction of new or enhanced sites, services and products by
the Company or its competitors, (iv) general economic conditions specific to the
Internet, online commerce or the travel industry, (v) the level of use of online
services and consumer acceptance of the Internet and commercial online services
for the purchase of consumer products and services such as those offered by the
Company, (vi) the Company's ability to upgrade and develop its systems and
infrastructure and to attract new personnel in a timely and effective manner,
(vii) the level of traffic on the Company's online sites, (viii) technical
difficulties, system downtime or Internet brownouts, (ix) the amount and timing
of operating costs and capital expenditures relating to expansion of the
Company's business, operations and infrastructure, (x) governmental regulation
and (xi) unforeseen events affecting the travel industry.

        In addition, the Company expects that it will experience seasonality in
its business, reflecting seasonal fluctuations in the travel industry, Internet
and commercial online service usage and advertising expenditures. The Company
anticipates that travel bookings will typically increase during the first and
second quarter in anticipation of summer travel and will typically decline
during the third quarter. Internet and commercial online service usage and the


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<PAGE>

rate of growth of such usage may be expected typically to decline during the
summer. Depending on the extent to which the Internet and commercial online
services are accepted as an advertising medium, seasonality in the level of
advertising expenditures could become more pronounced for Internet-based
advertising. Seasonality in the travel industry, Internet and commercial online
service usage and advertising expenditures is likely to cause fluctuations in
the Company's operating results and could have a material adverse effect on the
Company's business, operating results and financial condition.

        Due to the foregoing factors, quarterly revenues and operating results
are difficult to forecast, and the Company believes that period-to-period
comparisons of its operating results will not necessarily be meaningful and
should not be relied upon as an indication of future performance. It is likely
that the Company's future quarterly operating results from time to time will not
meet the expectations of security analysts or investors. In such event, the
price of the Company's Common Stock would likely be materially and adversely
affected.


LIQUIDITY AND CAPITAL RESOURCES

     During the nine-months ended September 30, 2004, operating activities
generated cash of approximately ($62,718) compared to ($63,318) for the
nine-month period ended September 30, 2003.

     We believe that our cash and short term investments on September 30, 2004
and our anticipated cash flow from operations will be sufficient to meet our
obligations on a timely basis for the next 12 months.

ITEM 3 - CONTROLS AND PROCEDURES

         Evaluation of disclosure controls and procedures
         ------------------------------------------------

     Our chief executive officer and chief financial officer have reviewed and
evaluated the effectiveness of our disclosure controls and procedures (as
defined in Rules 13a-14 and 15d-14 under the Securities Exchange Act of 1934
(the "Exchange Act"), as of a date within ninety days before the filing of this
quarterly report. Based on that evaluation, the chief executive officer and
chief financial officer have concluded that our current disclosure controls and
procedures are effective to ensure that information required to be disclosed by
us in reports that we file or submit under the Exchange Act is recorded,
processed, summarized, and reported within the time periods specified in the
Commission's rules and forms.

         Changes in internal controls
         ----------------------------

     There have not been any significant changes in our internal controls or in
other factors that could significantly affect these controls subsequent to the
date of their evaluation. There were no significant deficiencies or material
weakness in the internal controls, and therefore no corrective actions were
taken.

PART II-- OTHER INFORMATION

ITEM 1 -- LEGAL PROCEEDINGS
            None

ITEM 2 - CHANGES IN SECURITIES
            None

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
            None

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<PAGE>

ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
            Not applicable

ITEM 5 - OTHER INFORMATION
            None

ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

         1. Exhibits:

            Rule 13a-14(a) / 15d-14(a) Certifications:
              o   Exhibit 31-1     Certification of Chief Executive Officer.
              o   Exhibit 31-2     Certification of Chief Financial Officer.

            Section 1350 Certifications:
              o   Exhibit 32-1     Certification of Chief Executive Officer.
              o   Exhibit 32-2     Certification of Chief Financial Officer.



         2. Reports on Form 8-K

               On February 11, 2003 the Company filed a report regarding the
          issuance of 200,000 and 800,000 shares of common stock to YTB Travel
          Cruise Ltd. and Yourtravelbiz, Inc., in connection with the signing of
          a long-term, web servicing agreement for a twenty (20) year period


               On August 26,2004 the Company filed a report regarding that REZT
          is in preliminary merger discussions with Yourtravelbiz.com, Inc., a
          private company in the travel agency business.



SIGNATURE

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

                                    REZCONNECT TECHNOLOGIES, INC.

                                    /S/ Michael Y. Brent
                                    -----------------------------
                                    Michael Y. Brent, CEO
                                    Dated: September 30, 2004


                                    /s/ Derek J. Brent
                                    --------------------
                                    Derek J. Brent, CFO
                                    Dated: September 30, 2004

     This Form 10-QSB contains summary financial information extracted from the
financial statements for the nine months ended September 30, 2004 and is
qualified in its entirety by reference to such financial statements.



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