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 and
Exchange Act of 1934 for the quarter 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 Number:                              001-12885


                        AVENUE ENTERTAINMENT GROUP, INC.
                  ------------------------------------------
        (Exact Name of Small Business Issuer as Specified in its Charter)

         Delaware                                               95-4622429
---------------------------                                 ------------------
(State or other jurisdiction of                            (I.R.S. Employer
incorporation or organization                               Identification No.)

10 West 66th Street
New York, NY                                                     10023
------------------------------------                          ----------
(Address of principal executive offices)                      (Zip Code)

                                  (212)769-3814
              (Registrant's telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities and 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 90 days.

        Yes     X                                   No ______
            ---------

Indicate by check mark whether the registrant is a shell company (as defined by
Rule 12b-2 of the Exchange Act.

        Yes                                         No ___X___
             -----

Number of shares outstanding of each of issuer's classes of common stock as of
Febuary 11, 2006:

Common Stock                                            4,656,280



<PAGE>




                        AVENUE ENTERTAINMENT GROUP, INC.

                                TABLE OF CONTENTS

PART I.  FINANCIAL INFORMATION                                         Page No.
                                                                       --------

  Item 1. Financial Statements

          Unaudited Condensed Consolidated Balance Sheet -
          September 30, 2005                                                1

          Unaudited Condensed Consolidated Statements of Operations -
          Three Months and Nine Months Ended
          September 30, 2005 and 2004                                       2

          Unaudited Condensed Consolidated Statements of Cash Flows -
          Nine months ended September 30, 2005 and 2004                     3

          Unaudited Notes to Condensed Consolidated Financial Statements    5

  Item 2. Management's Discussion and Analysis or Plan of Operation        12

  Item 3. Controls and Procedures                                          15

PART II. OTHER INFORMATION

  Item 1. Legal Proceedings                                                16

  Item 2. Changes in Securities                                            16

  Item 3. Defaults Upon Senior Securities                                  16

  Item 4. Submissions of Matters to a Vote of Security Holders             16

  Item 5. Other Information                                                17

  Item 6. Exhibits and Reports on Form 8-K                                 17

          Signatures                                                       18

          Statement by Principal Executive and Financial Officer Regarding
          Facts and Circumstances Relating to Exchange Act Filings         19

          Written Statement of President and Chief Executive and
          Financial Officer                                                20

<PAGE>



                          PART I. FINANCIAL INFORMATION

                        AVENUE ENTERTAINMENT GROUP, INC.


                      UNAUDITED CONSOLIDATED BALANCE SHEET

<TABLE>
<CAPTION>
                                                                                           September 30,
                                                                                                 2005
                                                                                       --------------------
                                                                                       --------------------
Assets                                                                                     (unaudited)

<S>                                                                                             <C>
Cash                                                                                            $3,514
Accounts receivable from a related party, net of allowance of $0                                22,120
Property and equipment, net                                                                      4,696
Other assets                                                                                       391
                                                                                               -------
Total assets                                                                                   $30,721


Liabilities and Capital Deficit

Accounts payable and accrued expenses                                                         $192,232
Deferred income                                                                                132,611
Loan payable                                                                                    24,132
Deferred compensation                                                                          514,530
Due to related party                                                                           163,558
                                                                                            ----------
Total liabilities                                                                            1,027,063
                                                                                             ---------

Capital deficit

Common stock, par value $.01 per share, 15,000,000 shares
      authorized, 5,371,030 shares issued                                                       53,710
Additional paid-in capital                                                                   7,221,839
Accumulated deficit                                                                         (8,054,191)
Treasury stock, at cost (714,750 shares of common stock)                                       (67,700)
Note receivable for common stock                                                              (150,000)
                                                                                           ------------
Total capital deficit                                                                         (996,342)
                                                                                             ----------
Total liabilities and capital deficit                                                          $30,721
                                                                                            ==========
</TABLE>


   See accompanying notes to the condensed consolidated financial statements.


                                       1
<PAGE>



                        AVENUE ENTERTAINMENT GROUP, INC.

                 UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)

<TABLE>
<CAPTION>

                                                                   Three Months Ended              Nine Months Ended
                                                                      September 30,                  September 30,
                                                                  2005            2004            2005           2004
                                                                  ----            ----            ----           ----

<S>                                                               <C>            <C>              <C>             <C>
Operating revenues                                                $  44,207      $  26,184        $  105,031      $ 72,404
                                                                  ---------      ---------        ----------      --------

Selling, general & administrative expenses                          147,950         72,762           308,387       220,630
                                                                    --------        ------          --------       -------

Loss from continuing operations                                    (103,743)       (46,578)         (203,356)     (148,226)
                                                                   ----------      --------         ----------    ---------

Income (loss) from discontinued operations net of
income tax and gain on transaction
of $1,256,696 in 2005
                                                                  1,298,565        (96,631)        1,212,080        93,811
                                                                  ---------        --------      -----------        ------

Net income (loss)                                                $1,194,822      $(143,209)       $1,008,724      $(54,415)
                                                                  ---------      ----------       ----------      ---------

Per share data:
Loss from continuing operations
- Basic and diluted                                                 $(.02)          $(.01)           $(.04)         $(.03)
Income (loss) from discontinued operations
- Basic and diluted                                                   .25            (.02)             .23            .02
                                                                      ---            -----             ---            ---
Net income (loss) per share - basic and diluted                      $.23           $(.03)            $.19          $(.01)
                                                                     ----           ------            ----          ------

Weighted average common shares outstanding
- Basic and diluted                                               5,193,218      5,371,030         5,299,905     5,371,030
                                                                  =========      =========         =========     =========


</TABLE>




   See accompanying notes to the condensed consolidated financial statements.


                                       2
<PAGE>




9

                        AVENUE ENTERTAINMENT GROUP, INC.

                 UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)
<TABLE>
<CAPTION>
                                                                                           Nine months ended
                                                                                             September 30,
                                                                                     2005                    2004
                                                                              -------------------    ---------------------
                                                                              -------------------    ---------------------

Cash flows from operating activities:
<S>                                                                              <C>                      <C>
   Net income (loss)                                                             $1,008,724               $(54,415)
Adjustments to reconcile net loss to net cash (used for)
    provided by operating activities:
   Gain on sale of discontinued operation                                        (1,256,696)
   Depreciation                                                                       2,785                  3,867
   Stock options issued for services                                                 49,000
   Amortization - film production costs                                                   0                 13,492
   Deferred compensation                                                            106,700                (11,224)
   Changes in assets and liabilities:
       Accounts receivable                                                            8,776                116,219
       Film costs                                                                    45,422                 74,278
       Other assets                                                                     405                  1,163
       Accounts payable and accrued expenses                                        (13,467)               (52,334)
       Due to related party                                                           4,092                      0
       Deferred income                                                              (75,359)               (75,996)
                                                                                    --------               --------
           Net cash (used for)  provided by operating activities
           and discontinued operations                                             (119,618)                15,050
                                                                                   ---------                ------

Cash flows from investing activities:
  Purchase of equipment                                                             (4,890)                      0
                                                                                 ----------             ----------
              Net cash used for investing activities                                (4,890)                      0
                                                                                   --------                -------

Cash flows from financing activities:
   Proceeds from (repayment of) loan payable                                       121,170                 (27,000)
                                                                                ----------              -----------
             Net cash provided by (used for) financing activities                  121,170                 (27,000)
                                                                                  --------                ---------

     Net decrease in cash                                                           (3,338)                (11,950)
Cash at beginning of period                                                          6,852                  37,626
                                                                                     -----                 -------
Cash at end of period                                                              $ 3,514               $  25,676
                                                                                   -------               ---------

Supplemental cash flow information:
  Cash paid during the year for:
     Interest                                                                       $6,631                 $ 1,529
                                                                                    ------                 -------
     Income taxes                                                                 $      0              $        0
                                                                                  --------              ----------
</TABLE>

   See accompanying notes to the condensed consolidated financial statements.


                                       3
<PAGE>


                        AVENUE ENTERTAINMENT GROUP, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.       Summary of significant accounting policies

The Company

Through September 2, 2005, Avenue Entertainment Group, Inc. (the "Company")
operated as an independent entertainment company that produced feature films,
television films, series for television, made-for-television/cable movies and
one-hour-profiles of Hollywood stars both domestically and internationally. As a
result of the sale of certain assets and liabilities to Cary Brokaw Productions
on September 2, 2005, (see Note 5) the Company has ceased the business of
producing feature films, television films, series for television and
made-for-television/cable movies. The Company's business is currently focused on
licensing its library of over 25 one- hour profiles of Hollywood stars, the
("Hollywood Collection"), both domestically and internationally. The business of
producing feature films, television films, series for television and
made-for-television/cable movies has been accounted for as a discontinued
operation, and has been reflected as such on the Condensed Consolidated
Financial Statements for the nine and three months ended September 30, 2005 and
2004.


Basis of presentation

The accompanying interim consolidated financial statements of the Company are
unaudited and have been prepared by the Company pursuant to the rules and
regulations of the Securities and Exchange Commission regarding interim
financial reporting. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements and should be read in conjunction with the consolidated
financial statements and notes thereto included in the Company's Form 10-KSB/A
for the year ended December 31, 2004. The Company has suffered losses from
operations, has a working capital deficiency and has an accumulated deficit that
raises substantial doubt about its ability to continue as a going concern. The
Company's current plan is to focus its business on licensing the Hollywood
Collection, both domestically and internationally. The accompanying financial
statements do not include any adjustments that may result from the Company's
inability to continue as a going concern. In the opinion of management, all
adjustments, consisting only of normal recurring adjustments, necessary to
present fairly the financial position of the Company at September 30, 2005, and
the results of its operations and its cash flows for the nine months ended
September 30, 2005 and 2004 have been included. The results of operations for
the interim period are not necessarily indicative of results that may be
realized for the full year.

In accordance with the provisions of the American Institute of Certified Public
Accountants of Position No. 00-2 ("SOP 00-2"), the Company has elected to
present an unclassified consolidated balance sheet



                                       4
<PAGE>



                        AVENUE ENTERTAINMENT GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)





Stock Option Plans

       Prior to January 1, 1996, the Company accounted for its stock option plan
       in accordance with the provisions of Accounting Principles Board (APB)
       Opinion No. 25, "Accounting for Stock Issued to Employees," and related
       interpretations. As such, compensation expense would be recorded on the
       date of grant only if the current market price of the underlying stock
       exceeded the exercise price. The Company has elected to continue to apply
       the provisions of APB Opinion No. 25 and account for stock options using
       the intrinsic value method and provide the pro forma disclosure
       provisions of SFAS No. 123 "Accounting for Stock-Based Compensation," as
       amended. SFAS No.123 was amended in December 2002 by SFAS No.148,
       "Accounting for Stock-Based Compensation--Transition and Disclosure."
       Compensation cost will continue to be recorded for options granted below
       fair market value.

                The Company applies APB Opinion No. 25 and related
       Interpretations in accounting for all its stock option plans.
       Accordingly, no compensation cost has been recognized under these plans.
       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," which was
       released in December 2002 as an amendment to SFAS No. 123. The following
       table illustrates the effect on net loss and earnings per share if the
       fair value based method had been applied to all awards (in thousands,
       except per share data):




                                       5
<PAGE>




                        AVENUE ENTERTAINMENT GROUP, INC.

        NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Continued)


<TABLE>
<CAPTION>

                                                         Three Months Ended               Nine Months Ended
                                                           September 30,                    September 30,
                                                   -------------------------------  -------------------------------
                                                   -------------------------------  -------------------------------
                                                        2005            2004             2005            2004
                                                   --------------- ---------------  --------------- ---------------
<S>                                                    <C>             <C>              <C>              <C>
   Reported net income (loss)                          $1,194,822      $(143,209)       $1,008,724       $(54,415)
   Stock-based employee compensation
     expense in reported net loss, net of
     related tax effects                                   14,000              0            14,000               0
                                                   --------------- ---------------  --------------- ---------------
                                                   --------------- ---------------  --------------- ---------------
                                                        1,208,822       (143,209)        1,022,724         (54,415)
   Stock-based employee compensation
     expense determined under the fair
     value method, net of related tax effects             (14,000)                                         (14,000)
                                                   =============== ===============  =============== ===============
                                                   --------------- ---------------  --------------- ---------------
Pro forma net income (loss)                        $    1,194,822  $    (143,209)   $    1,008,724  $      (54,415)
                                                   =============== ===============  =============== ===============

Income (loss) per share-basic and diluted
As reported                                        $          .23  $        (.03)   $          .19  $        (.01)
Pro forma                                          $          .23  $        (.03)   $          .19  $        (.01)
</TABLE>

Recent accounting pronouncements. During December 2004, the Financial Accounting
Standards Board ("FASB") issued a new standard entitled Statement of Financial
Accounting Standards ("SFAS") 123R, Share-Based Payment, which would revise SFAS
No. 123, Accounting for Stock Based Compensation, and amend SFAS No. 95,
Statement of Cash Flows. Among other items, the new standard would require the
expensing, in the financial statements, of stock options issued by the Company.
For the Company, the new standard will be effective January 1, 2006. The Company
is currently evaluating the method of adoption of SFAS No. 123R, including the
valuation methods and assumptions that underlie the valuation of the awards. As
permitted under SFAS No. 123 the Company currently accounts for share-based
payments to employees using Accounting Principles Board ("APB") Opinion No. 25
intrinsic value method, and as such, recognizes no compensation cost for
employee stock options. Accordingly the adoption of SFAS No. 123R fair value
method could have a significant impact on the Company's results of operations,
although it will have no impact on the Company's overall financial position. The
impact of adoption of SFAS No. 123R cannot be predicted at this time, because it
will depend on levels of share-based payments in the future







                                       6
<PAGE>



                        AVENUE ENTERTAINMENT GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)





2.       Property and equipment

         The major classes of property and equipment consist of the following:


                                            Useful           September 30,
                                             life                2005
                                        --------------  ------------------------
                                        --------------  ------------------------
         Machinery and equipment        4 to 5 years             $7,465


         Less accumulated depreciation                           (2,769)
                                                                 -------
                                                              $   4,696

Depreciation expense from continuing operations was $452 and $386 for the nine
months ended September 30, 2005 and 2004, respectively.



3.       Income (loss) per share

The Company calculates income (loss) per share in accordance with SFAS No. 128,
"Earnings per Share." Basic income (loss) per share is computed by dividing the
income (loss) available to common shareholders by the weighted-average number of
common shares outstanding. Diluted income (loss) per share is computed similar
to basic income (loss) per share except that the denominator is increased to
include the number of additional common shares that would have been outstanding
if the potential common shares had been issued and if the additional common
shares were dilutive.

The following potential common shares representing options outstanding under the
Company's stock option plan have been excluded from the computation of diluted
income (loss) per share because the effect would have been anti-dilutive:

Three and nine months ended September 30, 2004; 2,235,000 options

Three and nine months ended September 30, 2005; 1,535,000 options



                                       7
<PAGE>




                        AVENUE ENTERTAINMENT GROUP, INC.

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)



4.       Loan payable

On June 21, 2004 the Company entered into an unsecured loan for $200,000 at
prime plus 1% with City National Bank which matured on June 15, 2005 and was
then renewed for the same amount with a maturity date of June 15, 2006. As of
September 1, 2005 $185,000 had been borrowed under the loan. As part of the
Brokaw Agreement (see Note 6) the unsecured loan was assumed by Cary Brokaw
Productions, Inc. as of September 2, 2005.

5.         Brokaw agreement

On September 2, 2005, the Company, Avenue Pictures, Inc., a wholly owned
subsidiary of the Company ("Avenue Pictures"), Cary Brokaw, and Cary Brokaw
Productions, Inc. ("Brokaw Productions"), a corporation wholly owned by Cary
Brokaw, entered into an Asset Purchase Agreement (the "Brokaw Agreement"), and
completed the asset purchase and sale described in the Brokaw Agreement (the
"Brokaw Purchase").

On September 2, 2005, Cary Brokaw resigned as a director of the Company, and as
the Company's President and Chief Executive and Financial Officer. Cary Brokaw
also resigned prior to completion of the Brokaw Purchase as a director and
officer of the following entities, each of which is a direct or indirect wholly
owned subsidiary of the Company: Avenue Pictures, Black Coffee Productions,
Inc., Grafasi, Inc., Shadow and Light Productions, Inc., TCB Productions, Inc.,
and LCA Acquisition Subsidiary.

Under the terms of the Brokaw Agreement, (1) Avenue Pictures transferred certain
of its assets to Brokaw Productions, (2) Avenue Pictures assigned certain of its
liabilities to Brokaw Productions, and (3) Brokaw Productions granted Avenue
Pictures a right to certain of the revenues that Brokaw Productions may be
entitled to receive in the future related to selected assets transferred by
Avenue Pictures to Brokaw Productions pursuant to the Brokaw Agreement. The
assets transferred to Brokaw Productions included Avenue Pictures rights in
certain theatrical and cable motion picture projects, including all of Avenue
Picture's rights under various producer agreements. In addition, the assets also
included Avenue Picture's rights to



                                       8
<PAGE>





                        AVENUE ENTERTAINMENT GROUP, INC.

        NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Continued)


5.         Brokaw agreement (continued)


various scripts (including options to purchase or develop various scripts),
which may in the future become motion picture or other entertainment projects,
as well as certain of Avenue Picture's "First Look" rights with respect to
various entertainment projects. Brokaw Productions also acquired various office
equipment, furniture, and fixtures so that it could continue Avenue Picture's
business that related to the purchased assets.

The terms of the Brokaw Agreement require Cary Brokaw to pay the Company a
percentage of any proceeds he receives as a result of any future sale of Brokaw
Productions or any registered initial public offering of Brokaw Production's
equity securities. Cary Brokaw also transferred 711,250 shares (fair value
$64,000 calculated based on quoted market price of $0.09 per share on September
2, 2005) of the Company's common stock to Avenue Pictures, and delivered to the
Company for cancellation all options held by him to purchase shares of the
Company's common stock. The Company also agreed to issue Cary Brokaw a new
totally vested option with an expiration on September 2, 2010 to purchase
500,000 shares of the Company's common stock, at a purchase price of $0.50 per
share of Company's common stock. The option was valued at $35,000 using the
Black-Scholes option pricing model. Brokaw Productions did not pay any cash or
cash equivalents as consideration for the Brokaw Purchase. The fair value of the
711,250 shares of common stock received and options granted have been included
inn determining the gain on discontinued operations. The common stock is also
included in treasury stock.

The Brokaw Agreement also requires the Company and Avenue Pictures to change
their corporate names and to cease all use of the names "Avenue Entertainment
Group," "Avenue Pictures," and all other similar names, trademark, brand, and
logos, as soon as practicable after September 2, 2005.

In connection with the Brokaw Agreement, the Company also entered into a Voting
Agreement, dated as of September 2, 2005 between the Company and Cary Brokaw,
which agreement provides that Cary Brokaw will vote all of the shares of the
Company's common stock that he owns in accordance with the recommendation of the
Company's board of directors. This Voting Agreement will terminate no later than
September 2, 2007.

The foregoing summary of the Brokaw Agreement and the Voting Agreement is not
complete and is qualified in its entirety by reference to the complete text of
the Brokaw Agreement and the Voting Agreement, which are filed as Exhibits 2.1
and 10.1 to the Company's Current Report on Form 8-K filed September 7, 2005.






                                       9
<PAGE>




                        AVENUE ENTERTAINMENT GROUP, INC.

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)


5.  Brokaw agreement (continued)

As required by the Brokaw Agreement, effective on September 2, 2005, the Company
granted Cary Brokaw an option to purchase shares of its common stock pursuant to
a Stock Option Agreement between the Company and Cary Brokaw (the "Brokaw Stock
Option Agreement"). Under the terms of the Brokaw Stock Option Agreement, the
Company issued Cary Brokaw a fully vested option to purchase 500,000 shares of
the Company's common stock, at a purchase price of $0.50 per share of Company
common stock. The Company accounted for the effect of the Brokaw Agreement as a
discontinued operation, as a result of the Company having ceased the business of
producing feature films, television films, series for television and
made-for-television/cable movies. This has been reflected in the Statement of
Operations as discontinued operations.

Revenue and pre tax (loss) income from discontinued operations is as follows:


<TABLE>
<CAPTION>

                                          Three Months Ended               Nine Months Ended
                                             September 30,                   September 30,
                                         2005             2004            2005            2004
                                         ----             ----            ----            ----

<S>                                  <C>             <C>              <C>             <C>
Revenues                             $ 61,000        $ 111,000        $ 163,000       $ 759,000
                                                                      ----------      ---------
(Loss) income before income taxes    $ 30,000        $ (97,000)       $ (45,000)        $94,000
                                                                       ----------       -------

</TABLE>







                                       10
<PAGE>






                        AVENUE ENTERTAINMENT GROUP, INC.

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5.  Brokaw agreement (continued)

The following table represents the Company's pro forma consolidated statements
of operations for the year ended December 31, 2004 as if the Brokaw Agreement
and the Brokaw Purchase had been completed at the beginning of the period. The
pro forma information is presented for comparative purposes only and does not
purport to be indicative of what would have occurred had the Brokaw Agreement
and the Brokaw Purchase actually been made at such date, nor is it necessarily
indicative of future operating results:

                                                          Year Ended
                                                       December 31, 2004
   Operating revenues                                       $  125,274

   Operating costs and expenses                                315,975
                                                               -------

   Loss before income tax                                     (190,701)

   Income tax expense                                              165
                                                          ------------

   Net loss                                                 $ (190,866)
                                                            ===========

   Per share data:
   Loss per common share - Basic and diluted            $         (.04)
                                                        ===============
   Weighted average common shares outstanding -
       Basic and diluted                                     4,659,780
                                                             =========

6.       Related Party Transactions

     On March 1, 1994, the Company entered into an agreement with Janson
     Associates whereby Janson Associates (the distributor) was granted sole and
     exclusive rights to license all the programs of the Company's "Hollywood
     Collection" for all forms of television and video worldwide. The Hollywood
     Collection is a series of one-hour motion picture profiles of Hollywood's
     biggest stars, which are aired by a major cable network. The distributor
     also gained the exclusive right to execute all contracts for exploitation
     of these rights. Revenues earned for the nines months ended September 30,
     2005 and 2004 were $101,069 and $62,656 respectively, and the revenues
     earned for the three months ended September 30, 2005 and 2004 were $42,309
     and $26,184, respectively. Included in operating expenses were commissions
     accrued to Janson Associates of $36,494, $9,137, $15,243 and $6,152for the
     nine months ended September 30, 2005 and 2004 and the three months ended
     September 30, 2005 and 2004, respectively. The President of Janson
     Associates is related to the Chief Executive officer of the Company through
     marriage.




                                       11
<PAGE>





ITEM 2.        MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Except for the historical information presented in this document, the matters
discussed in this Form 10-QSB, and specifically in "Management's Discussion and
Analysis or Plan of Operation," or otherwise incorporated by reference into this
document, are "forward looking statements" (as such term is defined in the
Private Securities Litigation Reform Act of 1995). These statements can be
identified by the use of forward- looking terminology such as "believes,"
"expects," "may," "will," "intends," "should," or "anticipates" or the negative
thereof or other variations thereon or comparable terminology, or by discussions
of strategy that involve risks and uncertainties. The safe harbor provisions of
Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A
of the Securities Act of 1933, as amended, apply to forward-looking statements
made by Avenue Entertainment Group, Inc. (the "Company"). You should not place
undue reliance on forward-looking statements. Forward-looking statements involve
risks and uncertainties. The actual results that we achieve may differ
materially from any forward-looking statements due to such risks and
uncertainties. These forward-looking statements are based on current
expectations, and we assume no obligation to update this information. Readers
are urged to carefully review and consider the various disclosures made by us in
this report on Form 10-QSB and in our other reports filed with the Securities
and Exchange Commission ("SEC") that attempt to advise interested parties of the
risks and factors that may affect our business.

The following discussion and analysis of our financial condition and plan of
operation should be read in conjunction with the unaudited financial statements
and accompanying notes and the other financial information appearing elsewhere
in this report and with the audited financial statements contained in our Form
10-KSB/A for the year ended December 31, 2004.

Overview
 Through September 2, 2005, Avenue Entertainment Group, Inc. (the "Company")
operated as an independent entertainment company that produced feature films,
television films, series for television, made-for-television/cable movies and
one-hour-profiles of Hollywood stars both domestically and internationally. As a
result of the sale of certain assets to and assumption of liabilities by Cary
Brokaw Productions on September 2, 2005 (see Note 5 to the Consolidated
Financial Statements), the Company has ceased the business of producing feature
films, television films, series for television and made-for-television/cable
movies. The Company's business is currently focused on licensing its library of
over 25 one- hour profiles of Hollywood stars, the "Hollywood Collection", both
domestically and internationally. The business of producing feature films,
television films, series for television and made-for-television/cable movies has
been accounted for as a discontinued operation, and has been reflected as such
in the Consolidated Condensed Financial Statements for the nine and three months
ended September 30, 2005 and 2004.




                                       12
<PAGE>




Basis of Presentation

The accompanying interim condensed consolidated financial statements of the
Company are unaudited and have been prepared by the Company pursuant to the
rules and regulations of the Securities and Exchange Commission regarding
interim financial reporting. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements and should be read in conjunction with the
consolidated financial statements and notes thereto included in the Company's
Form 10-KSB/A for the year ended December 31, 2004. In the opinion of
management, all adjustments, consisting only of normal recurring adjustments,
necessary to present fairly the financial position of the Company at September
30, 2005, and the results of its operations and its cash flows for the nine and
three months ended September 30, 2005 and 2004 have been included. The results
of operations for the interim period are not necessarily indicative of results
that may be realized for the full year.

Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations
are based upon our condensed consolidated financial statements, which have been
prepared in accordance with generally accepted accounting principles in the
United States. The preparation of financial statements requires management to
make estimates and judgments that affect the reported amounts of assets and
liabilities, revenues and expense and disclosures at the date of the financial
statements. On an on-going basis, we evaluate our estimates, including, but not
limited to, those related to revenue recognition, accounts receivables,
inventories and impairment of intangibles. We use authoritative pronouncements,
historical experience and other assumptions as the basis for making estimates.
Actual results could differ from those estimates. We believe that the following
critical accounting policies affect our more significant judgments and estimates
in the preparation of our consolidated financial statements.

Revenue Recognition

The Company recognizes revenue in accordance with the provisions of Statement of
Financial Accounting Standards No. 139 and American Institute of Certified
Public Accountants Statement of Position 00-2 (collectively referred to as "SOP
00-2").

Revenues from feature film distribution licensing agreements are recognized on
the date the completed film is delivered or becomes available for delivery, is
available for exploitation in the relevant media window purchased by that
customer or licensee and certain other conditions of sale have been met pursuant
to criteria set by SOP 00-2.

Revenues from domestic television and video licensing contracts, which provide
for the receipt of non-refundable guaranteed amounts, are recognized when the
film is available for exhibition, provided that the other conditions of sale
required by SOP 00-2 have been met. Until all conditions of sale have been met,
amounts received on such licensing contracts are reflected in the accompanying
financial statements as deferred income. International sales and other sales in
the United States are recognized in the period in which payment is received.

The market trend of each film is regularly examined to determine the estimated
future revenues and corresponding lives. Due to the nature of the industry,


                                       13
<PAGE>

management's estimates of future revenues may change within the next year and
the change could be material.

Revenues from producer-for-hire contracts are recognized on a
percentage-of-completion method, measured by the percentage of costs completed
to date to estimated total cost for each contract. Provisions for estimated
losses on uncompleted contracts are made in the period in which such losses are
determined.


Results of Operations

For the three and nine months ended September 30, 2005 the Company had a loss
from continuing operations before income taxes of $104,000 and $203,000,
respectively, compared to losses from continuing operations before income taxes
of $47,000 and $148,000 for the three and nine months ended September 30, 2004,
respectively.

Revenues

Revenues for the three and nine months ended September 30, 2005 were
approximately $44,000 and $105,000, respectively compared to $26,000 and $72,000
for the three and nine months ended September 30, 2004, respectively. Revenues
earned in 2004 and 2005 were derived primarily from the licensing of rights of
the "Hollywood Collection" in secondary markets through Janson Associates. The
increased revenues in 2005 were due to increased sales of the Hollywood
Collection.

Selling, General and Administrative

Selling, general and administrative (SG&A) expenses for the three and nine
months ended September 30, 2005 were approximately $148,000 and $308,000
compared to $73,000 and $221,000 for the three and nine months ended September
30, 2004. The increase in SG&A is primarily due to increased professional fees
and increased commissions paid to Janson Associates as a result of increased
revenue earned from the licensing of rights of the "Hollywood Collection" in
secondary markets.

Liquidity and Capital Resources

At September 30, 2005, the Company had $4,000 of cash. Revenues were
insufficient to cover costs of operations for the nine months ended September
30, 2005. The Company has a working capital deficiency and has an accumulated
deficit of $8,054,000 through September 30, 2005. The Company does not believe
it will have sufficient funds from licensing its rights of the Hollywood
Collection in secondary markets available to continue to exist through the next
year. Insufficient funds will require the Company to scale back its operations.
The Company's condensed consolidated financial statements for the year ended
December 31, 2004 states that the Company has suffered losses from operations,
has a working capital deficiency and has an accumulated deficit that raises
substantial doubt about its ability to continue as a going concern. The
accompanying financial statements do not include any adjustments that may result
from the Company's inability to continue as a going concern.



                                       14
<PAGE>

Most public companies working in film and television production are much larger
in size and generally have large libraries of film and/or television properties
that provide an ongoing revenue stream. As a result of the agreement dated
September 2, 2005 (see Note 5 to the Condensed Consolidated Financial
Statements), the Company currently does not produce or plan to produce
additional films or television productions, including one hour biographies.
Therefore the Company will generate substantially all its revenues going forward
from its existing library of approximately 25 films which will significantly
limit its potential for increased revenue.


Forward- Looking Statements

This report contains certain forward-looking statements reflecting management's
current views with respect to future events and financial performance. These
forward-looking statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those in the
forward-looking statements, including, but not limited to, the ability of the
Company to reverse its history of operating losses; the ability to obtain
additional financing and improved cash flow in order to meet its obligations and
continue to exist as a going concern; dependence on contracts with certain
customers; future foreign distribution arrangements; and dependence on certain
key management personnel. All of these above factors are difficult to predict,
and many are beyond the control of the Company.


ITEM 3. CONTROLS AND PROCEDURES
We carried out an evaluation, under the supervision and with the participation
of our Chief Executive Officer and Financial Officer, of the effectiveness of
the design and operation of our disclosure controls and procedures pursuant to
Rule13-15 (b) of the Securities Exchange Act of 1934, as amended. Based upon
that evaluation, our Chief Executive Officer and Financial Officer concluded
that our disclosure controls and procedures are effective as of the end of the
period covered by this report.

There was no change in our internal control over financial reporting during the
quarter ended September 30, 2005 that has materially affected, or is reasonably
likely to materially affect our internal control over financial reporting.


                                       15
<PAGE>



                        AVENUE ENTERTAINMENT GROUP, INC.

                               September 30, 2005

                           PART II. OTHER INFORMATION


Item 1.           Legal Proceedings

We may become involved in litigation arising out of operations in the normal
course of business. As of September 30, 2005, we are not a party to any pending
legal proceedings the adverse outcome of which could reasonably be expected to
have a material adverse effect on our operating results or financial position.


Item 2.           Unregistered Sales of Equity Securities and Use of Proceeds

                  Under the terms of the agreement dated September 2, 2005, the
Company, Avenue Pictures, Inc., a wholly owned subsidiary of the Company
("Avenue Pictures"), Cary Brokaw, and Cary Brokaw Productions, Inc. ("Brokaw
Productions"), a corporation wholly owned by Cary Brokaw, entered into an Asset
Purchase Agreement (the "Brokaw Agreement"), and completed the asset purchase
and sale described in the Brokaw Agreement (the "Brokaw Purchase"). The terms of
the Brokaw Agreement required Cary Brokaw transfer 711,250 shares of the
Company's common stock to Avenue Pictures, and deliver to the Company for
cancellation all options held by him to purchase shares of the Company's common
stock. The Company also agreed to issue Cary Brokaw a new option to purchase
500,000 shares of the Company's common stock, at a purchase price of $0.50 per
share of Company common stock. This stock option was issued as described below.
Brokaw Productions did not pay any cash or cash equivalents as consideration for
the Brokaw Purchase. The Company did not register this stock option with the
Securities and Exchange Commission, and is issuing this stock option to Cary
Brokaw under the exemption from registration provided by Section 4(2) of the
Securities Act of 1933, as amended (the "Act"), as a sale of securities not
involving a public offering. Cary Brokaw may require the Company to register the
shares subject to his option pursuant to the Act. See Note 6 to the Consolidated
Financial Statements.

Item 3.           Defaults Upon Senior Securities

                  None


Item 4.           Submissions of Matters to a Vote of Security Holders

                  In the first, second and third quarters ended September 30,
                  2005 there were no matters submitted to a vote of security
                  holders.


Item 5.           Other Information

                  None.




                                       16
<PAGE>

Item 6.           Exhibits
                  (a)      Exhibits

                  2.1. Asset Purchase Agreement between Cary Brokaw Productions
     Inc., Cary Brokaw, Avenue Pictures, Inc., and Avenue Entertainment Group,
     Inc. dated as of September 2, 2005. Incorporated by reference to Exhibit
     2.1 of the Current Report on Form 8-K of Avenue Entertainment Group, filed
     on September 7, 2005.

                  10.1. Voting Agreement dated as of September 2, 2005, by and
     among Cary Brokaw, Avenue Entertainment Group, Inc., and Gene Feldman.
     Incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K
     of Avenue Entertainment Group, filed on September 7, 2005.

                  10.2. Stock Option Agreement between Avenue Entertainment
     Group, Inc. and Cary Brokaw dated September 2, 2005. Incorporated by
     reference to Exhibit 10.2 of the Current Report on Form 8-K of Avenue
     Entertainment Group, filed on September 7, 2005.

                  31. Certification of Chief Executive and Financial Officer
     Pursuant to Section 302 of the Sarbanes-Oxley Act of 2003.

                  32. Written Statement of the President and Chief Executive and
     Financial Officer pursuant to 18 U.S.C. ss.1350.





                                       17
<PAGE>




                                   SIGNATURES

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

                                    AVENUE ENTERTAINMENT GROUP, INC.





DATE:  February 16, 2006            BY:      ________________________
                                             Gene Feldman, President
                                             and Chief Executive and Financial
                                             Officer

<PAGE>                                  18