SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

[X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
      ACT OF 1934

                   For the Fiscal Year ended December 31, 2002

                                       OR

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES AND
      EXCHANGE OF 1934

                        For the Transition Period From to

                          Commission file number 0-3338

                     MILLENNIUM BIOTECHNOLOGIES GROUP, INC.
                     --------------------------------------
             (Exact Name of Registrant as Specified in its Charter)

                   Delaware                                  22-1558317
      --------------------------------------------------------------------
      (State or other Jurisdiction of                      (IRS Employer
       Incorporation or Organization)                    Identification No.)

            665 Martinsville Road, Suite 219 Basking Ridge, NJ 07920
            --------------------------------------------------------
               (Address of Principal Executive Office) (Zip Code)

                                 (908) 604-2500
                                 --------------
               (Registrant's telephone number including area code)

                               REGENT GROUP, INC.
                               ------------------
                             (Former Conformed Name)

                                  April 1, 2002
                                  -------------
                              (Date of Name Change)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of Securities 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


<PAGE>

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-B is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by reference  in Part III of this Form 10-KSB or any  amendment to
this Form 10-KSB. [ ]

      The Registrant's revenues for the fiscal year ended December 31, 2002,
were $675,080.

Common stock, par value $.001 per share ("Common Stock"),  was the only class of
voting  stock of the  Registrant  outstanding  on March 31,  2003.  Based on the
closing  price of the  Common  Stock  on the OTC  Electronic  Bulletin  Board as
reported  on  March  31,  2003,  ($0.30),  the  aggregate  market  value  of the
10,201,007  shares of the  Common  Stock held by  persons  other than  officers,
directors and persons known to the  Registrant to be the  beneficial  owners (as
the term is defined under the rules of the Securities  and Exchange  Commission)
of  more  than  five  percent  of the  Common  Stock  on  March  31,  2003,  was
approximately $3,060,302.  By the foregoing statements,  the Registrant does not
intend to imply that any of the officers,  directors,  or beneficial  owners are
affiliates of the  registrant or that the  aggregate  market value,  as computed
pursuant  to rules of the  Securities  and  Exchange  Commission,  is in any way
indicative  of the amount  which  could be  obtained  for such  shares of Common
Stock.

As of March 31,  2003,  18,703,160  shares of Common  Stock,  $0.001  par value,
65,141shares  of Series B  Convertible  Preferred  Stock,  $1.00 par value,  and
64,763  shares of Series C Cumulative  Preferred  Stock,  $1.00 par value,  were
outstanding.

             DOCUMENTS INCORPORATED BY REFERENCE: SEE EXHIBIT INDEX


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<PAGE>

                     MILLENNIUM BIOTECHNOLOGIES GROUP, INC.

                                    CONTENTS

PART I.
                                                                            Page

      Item  1.    Business..................................................   4

      Item  2.    Properties................................................  11

      Item  3.    Legal Proceedings.........................................  11

      Item  4.    Submission of Matters to a Vote of Security Holders.......  11

PART II.

      Item  5.    Market for Registrant's Common Equity and
                  Related Shareholder Matters...............................  12

      Item  6.    Management's' Discussion and Analysis of Financial
                  Condition and Results of Operations.......................  14

      Item  7.    Financial Statements......................................  17

      Item  8.    Changes in and Disagreements with Accountants on
                  Accounting and Financial Disclosure.......................  17

PART III.

      Item 9.     Directors, Executive Officers, Promoters and
                  Control Persons; Compliance with Section 16(a)
                  of the Exchange Act.......................................  18

      Item 10.    Executive Compensation...................................   22

      Item 11.    Security Ownership of Certain Beneficial Owners and
                  Management and Related Stockholder Matters................  24

      Item 12.    Certain Relationships and Related Transactions............  25

      Item 13.    Exhibits and Reports on Form 8-K..........................  25

      Item 14.    Controls and Procedures...................................  26

                  Signatures................................................  27

                  Exhibit Index ............................................  28


                                                                               3
<PAGE>

                                     PART I

ITEM 1: BUSINESS

The Company

      Millennium   Biotechnologies  Group,  Inc.  (the  Company  or  "Millennium
Group"),  formerly  Regent Group,  Inc., is a holding company for its subsidiary
Millennium Biotechnologies, Inc. ("Millennium").

      Millennium was  incorporated in the State of Delaware on November 9, 2000,
and is located in New Jersey.  Millennium is a research based  bio-nutraceutical
corporation involved in the field of nutritional science. Millennium's principal
source of revenue is from sales of its nutraceutical  supplements,  RESURGEX(TM)
and  PROSURGEX(TM)  which  provide  nutritional  support for  immuno-compromised
individuals undergoing medical treatment for chronic debilitating diseases.

      The Company  acquired  Millennium  on July 27,  2001,  when it completed a
merger with Millennium.  During the year prior to the merger, the Company had no
material  operations.  For more information on the Company's operations prior to
the merger and the general terms of the merger we refer to the Company's  report
on Form 10-KSB for the period  ended July 31, 2001 and related  filings with the
Securities and Exchange  Commission.  In the merger,  new Convertible  Preferred
Series  D  stock  was  issued  in  exchange  for all the  outstanding  stock  of
Millennium. Such preferred shares were subsequently converted into approximately
96% of the outstanding common stock of the Company. For accounting purposes, the
merger has been treated as an acquisition of Millennium Group by Millennium, and
a re-capitalization of Millennium.  The historical financial statements prior to
July 27,  2001,  are  those of  Millennium.  Subsequent  to July 27,  2001,  the
financial  statements are those of the Company and its  wholly-owned  subsidiary
Millennium, on a consolidated basis.

Background

      On July 27,  2001,  pursuant to an Agreement  and Plan of  Reorganization,
Millennium  paid  Millennium  Group  $146,000,  which  was  used to pay  certain
indebtedness of Millennium Group. In addition,  in November and December,  2001,
the Company paid off pre-merger  Millennium Group  liabilities of $91,640.  Each
share of common stock of Millennium was converted into preferred series D shares
of Millennium  Group at a rate of .025 preferred shares for each common share of
Millennium.  Each of these preferred series D shares is convertible into 641.215
common  shares of  Millennium  Group  and is  entitled  to  641.215  votes.  The
preferred  series D shares have been  converted  into common  shares on April 1,
2002.

      The Company is currently subject to the reporting  requirements of Section
15(d) of the  Securities  Exchange Act of 1934. The Company has the authority to
issue an aggregate of 75,000,000  common shares,  par value $0.001,  and 810,360
preferred shares, par value $1.00.

      As of December 31, 2002, there were outstanding  17,902,485 common shares,
65,141  shares of Series B  Convertible  Preferred  Stock,  and 64,763 shares of
Series C Cumulative Preferred Stock.


                                                                               4
<PAGE>

Narrative Description of Business

      Millennium developed two novel enteral nutritional  formulas,  RESURGEX(R)
and PROSURGEX(TM),  that play an important role as a nutritional  adjunct to the
medical treatment for certain chronic immuno-compromising  debilitating diseases
such as Acquired  Immune  Deficiency  Syndrome  ("AIDS"),  hepatitis and cancer.
Those infected with AIDS/HIV  (Human  Immunodeficiency  Virus) and other chronic
debilitating diseases present a multitude of medical/nutritional problems, which
include  weight loss,  immune  dysfunction,  free-radical  pathology and loss of
energy  production.  Millennium  believes that RESURGEX(R) and PROSURGEX(TM) are
the first  multi-component  nutritional  supplements  designed  to deal with the
multiple nutritional needs of the  immunocompromised  individual.  Specifically,
RESURGEX(R) and  PROSURGEX(TM)  have been formulated to address the loss of lean
muscle (wasting), nutrient depletion, immune support,  mitochondrial dysfunction
(energy  loss)  and  oxidative  stress  (free-radical   damage)  in  individuals
undergoing medical treatment for chronic immunocompromised medical conditions.

      The  Company's   proprietary   formulations  combine  a  unique  blend  of
nutritional  components  that  enable  the  individual  to better  tolerate  the
nutritional  concerns of their illness and the side effects brought on by common
medication  regimes.  The desirable taste, of RESURGEX(R) and  PROSURGEX(TM) and
their easy-to-use  delivery method were designed to promote sustained acceptance
under  long-term  use  and  should  have a  significant  impact  on a  patient's
propensity to follow an ongoing regimen of compliance.

General Description

      RESURGEX(R) and PROSURGEX(TM) are new multi-component nutritional formulas
that were designed to address the multiple  nutritional needs (oxidative stress,
lean tissue  loss,  energy  depletion,  immune  support)  of  immuno-compromised
conditions as an adjunct to medical treatment.

      Both RESURGEX(R) and  PROSURGEX(TM)  have been positioned to provide for a
comprehensive,  high quality  alternative  to traditional  high sugar,  high fat
supplements  that load up on corn oil,  corn syrup and  sucrose  or the  "single
magic bullet"  products that only address one of the several  nutritional  needs
and concerns of the individual.

      RESURGEX(R)  is the first low fat (1g),  low sugar  (5g),  low calorie (90
Kcal) enteral nutritional formula to provide multiple comprehensive  nutritional
regimens  into  one  delicious  and  convenient  drink  and  commonly  used as a
nutritional supplement to meals.

      PROSURGEX(TM)  is the first high  protein  (21g),  high calorie (400 Kcal)
enteral  nutritional  formula  to  provide  multiple  comprehensive  nutritional
regimens into one delicious and convenient  drink. It is commonly used as a meal
replacement  or can be used as a sole  source  of  nutrition  as  directed  by a
physician.  Concentrated  calories  derived  from high  quality  food sources as
opposed to typical corn oil,  sucrose and corn syrup found in other  nutritional
supplements.

      Both  RESURGEX(R)  and  PROSURGEX(TM)   contain  a  comprehensive  mix  of
specialized  nutrients  that  contribute  to one or more  aspects  of  support -
immune,  energy,  antioxidant  and  maintenance  of lean  tissue  - such as high
quality undenatured whey protein,  CoQ10,  Nucleotides,  D-Ribose,  L-Carnitine,
Ornithine  Ketogluterate  (OKG),  Beta Glucans,  Branched  Chain Amino Acids and
other  important  ingredients.  Our  exclusive,  proprietary  ingredient in both
products  is  SOD/Gliadin  or  GliSODin(TM)  (superoxide  dismutase),  an orally
available  form of the cell's  master  antioxidant  defense  that is involved in
numerous important functions in the body.

      While these represent several  important  nutraceuticals in both formulas,
GliSODin(TM)  ("SOD/gliadin")  is  an  integral  component  of  RESURGEX(R)  and
PROSURGEX(TM).  SOD/gliadin is a unique patented,  vegetarian form of the cell's
master cellular defense enzyme, developed for oral use. In July 2001, Millennium
entered into an exclusive license agreement with Isocell S.A., the holder of the
patent for  SOD/gliadin.  Pursuant to the license,  Millennium has the exclusive
North American  rights to purchase,  promote and  distribute  SOD/gliadin in the
channel of distribution for


                                                                               5
<PAGE>

direct sale of nutraceutical products to physicians for resale to their patients
or  through  physician  prescription  for  Medicaid/Medicare  reimbursement  for
nutritional supplements.

How The Products Work

      Essentially,  there  are  several  pathways  and  concerns  that  must  be
addressed  when it comes to  nutritional  support in any major  degenerative  or
immuno-compromised  condition.  While there are several  "single  magic  bullet"
products on the market, this approach will inevitably fail since they only focus
on one concern while neglecting the others.  Both RESURGEX (R) and PROSURGEX(TM)
were developed to address the major nutritional  concerns that may be influenced
by nutritional  support as an adjunct to medical care. In addition,  rather then
providing  significant amounts of calories from corn oil, sucrose and corn syrup
combined with an inexpensive  multivitamin blend,  RESURGEX(R) and PROSURGEX(TM)
were  developed to provide a  comprehensive  and complex  array of nutrients and
nutraceuticals  that  play  important  roles in  health  and well  being.  These
include:

      Mitochondrial (Energy) Support

      Mitochondria are tiny organelles found inside all human cells of the body.
Essentially,  they are the cell's  "power  plants" that produce  energy (ATP) as
well as involved in protein and fat  processing.  Several  things can affect how
well the  mitochondria  work.  As people age,  presence of infections or certain
diseases, strenuous activity and certain medications, the efficiency of how well
the mitochondria can function is hampered. These changes or mutations may damage
the mitochondria (mitochondrial toxicity) and either disrupt the normal function
or cause them to stop working altogether.  RESURGEX(R) and PROSURGEX(TM) contain
a  patented  blend  of  ingredients  that  help  support  the  function  of  the
mitochondria  and assist in the production of energy in the cell.  Some of these
ingredients include:

      o Coenzyme  Q10 (COQ10) - is an  essential  component  of cellular  energy
production and respiration since it participates in the  mitochondrial  electron
transport  system,  which supplies  energy (ATP) for a variety of  physiological
functions.   Muscle   mitochondria   lack  adequate  COQ10  in  several  chronic
conditions.

      o L-Carnitine - functions  primarily to regulate fat  metabolism  and also
acts as a carrier of fatty acids into the mitochondria,  where they are oxidized
and converted into energy (ATP). It has been  established in the literature that
serum  carnitine   deficiency  is  common  in  certain  conditions  and  several
medications are associated with mitochondrial destruction.

      o Ribose - is a carbohydrate  used by the cells to form the primary source
of all the body's energy - ATP.  Ribose plays a key role in the  generation  and
recovery  of ATP.  Ribose  can offer  powerful  complimentary  support  to other
nutrients addressing energy depletion by aiding normal ATP production.

      Reduce Oxidative Stress (Free Radical Burden)

      Oxidative  Stress in the body is caused by an  imbalance  or  overload  of
oxidants  (free  radicals  from  air,  food,  metabolism,  medications,  stress,
disease,  etc.).  Sustained  oxidative  stress disrupts the cell's structure and
defenses  resulting  in  damage  or death to the  cell  and  contributes  to the
pathophysiology  of many  diseases.  As we age or are  presented  with  disease,
proper  antioxidant  defense is  essential  for  recovery.  While there are many
important  antioxidants  - Vitamin C,  Vitamin E, zinc,  selenium,  polyphenols,
carotenoids,  etc,  - the  one  that  stands  above  all  is the  cell's  master
antioxidant  defense  enzyme called  superoxide  dismutase  (SOD).  The clinical
relevancy  of SOD has  been  demonstrated  in  numerous  scientific  studies  in
cardiology,  immunology,  oncology,  inflammatory conditions, asthma, vision and
liver support. Exclusive to Millennium  Biotechnologies,  in the medical market,
is  the  first  orally  effective  vegetarian  form  of SOD  as  opposed  to the
injectable  bovine  material  previously  used.  RESURGEX(R)  and  PROSURGEX(TM)
contain a patented blend of ingredients  that help support the cell's ability to
defend against oxidative stress. Some of these ingredients include:


                                                                               6
<PAGE>

      o SOD/Gliadin  (GliSODin(TM))  - As an antioxidant,  SOD helps to decrease
oxidative  stress - it is the  master  cellular  defense  enzyme of the cell and
serves as significant  support for the immune system, it can counter the harmful
effects of free radicals,  thereby  diminishing  their  negative  effects on the
body.  SOD has been shown to  influence  the  negative  effects of  inflammatory
cytokines, support immune function, and reduce oxidative stress.

      o Undenatured  Whey Protein - undenatured whey has been shown to assist in
cellular  defense  by  increasing  available  glutathione  -  another  important
cellular  antioxidant  required by the body to ward off the effects of oxidative
stress.

      o  Beta  Glucans  -powerful   antioxidant   attributes,   with  heightened
free-radical scavenging capabilities

      o  Multi-Vitamin/Mineral  Mix,  Polyphenols - contain important  accessory
antioxidants.

      o Coenzyme Q10 - a powerful cellular  antioxidant with roles in preventing
oxidation of fatty cell membranes and ultimately cell death

      Maintain Lean Muscle

      A  common  problem  as we age  and  among  many  chronic  degenerative  or
immunocompromised  conditions is lean muscle loss or wasting. This problem, also
known as cachexia,  can diminish the quality of life,  and  exacerbate  illness.
Several  issues  related to the loss of muscle during illness and aging include:
inadequate caloric intake, problems with metabolism,  elevations of inflammatory
compounds  that  break  down  muscle  (certain   cytokines)  or   malabsorption.
Nutritional  supplementation  has played an important  role in boosting  caloric
intake, but in many conditions  increasing  calories may not be the only answer.
RESURGEX(R) and PROSURGEX(TM)  contain a patented blend of ingredients that help
maintain lean tissue by providing high quality protein and compounds that assist
in building muscle and prevent its breakdown. Some of these ingredients include:

      o  Undenatured  Whey - When it comes to  nutritional  support  directed at
maintaining lean mass,  adequate calories and good quality protein is essential.
By virtue of it's  biological  value (BV), whey protein has long been considered
the best source of protein for building and retaining lean muscle mass, which is
why it has become a nutritional staple for immuno-compromised patients.

      o Ornithine  alpha-ketoglutarate  (OKG) - affects  wasting  through  three
primary  mechanisms:  as an anabolic agent  (build-up of muscle  tissue),  as an
anti-catabolic agent (prevents breakdown of muscle tissue), and as an inducer of
protein synthesis.  All three mechanisms  contribute to muscular development and
enhanced recovery.  Lastly, OKG spares the loss of glutamine in muscle, which is
essential for recovery and repair.

      o Branched  Chain  Amino Acids  (BCAA) - play a  principle  role in muscle
recovery, muscle growth and energy maintenance and must be present in the muscle
cells to promote  protein  synthesis.  Why we need these  special amino acids is
simple: scientific evidence shows that branched-chain amino acids may help build
and retain lean muscle mass.

      o  Nucleotides  -  building  blocks of (DNA) and (RNA)  dietary  source is
required to promote optimal tissue growth

      Immune Support

      Essentially,  good nutritional support supplying essential  macronutrients
and  micronutrients  are  critically  important for  maintaining a proper immune
system.  Nevertheless,  if the cells of the immune system cannot  produce energy
efficiently   (mitochondrial   dysfunction),   have  poor  antioxidant  defenses
(oxidative stress) and the body is losing important lean muscle,  immune support
cannot  effectively be achieved.  This is the primary reason why RESURGEX(R) and
PROSURGEX(TM) were developed as a modular component system that provides support
in  addressing  these needs and issues.  In addition,  both  products  contain a
patented blend of ingredients that help support the immune system. Some of these
ingredients  include:  SOD/Gliadin  (GliSODin(TM)),  Beta Glucans,  Nucleotides,
Undenatured Whey high in Immunoglobulins, OKG, CoQ10 and Carnitine.


                                                                               7
<PAGE>

Special Features of RESURGEX(R) and PROSURGEX(TM)

      o Includes  SOD/Gliadin  (GliSODin(TM)),  a unique,  vegetarian  patented,
orally effective form of superoxide dismutase derived from melon

      o RESURGEX(R) was awarded a use and composition  patent,  PROSURGEX(TM) is
patent pending

      o High Quality Undenatured Protein

      o Concentrated  High Quality  Calories in  PROSURGEX(TM),  Low Calories in
RESURGEX(R)

      o Comprehensive Nutrient Mix

      o Iron Free

      Tastes Great

      o Delicious Flavor

      o Mixes Easily

      o Smooth Texture

      Easy To Use

      o Single-Serving Dosage

      o Convenient Anytime, Anywhere

      o Just Add Cold Water - Mix/Shake and Enjoy

      o Great For Travel

Principal Market

      The principal  market for the Company's  products is comprised of patients
whose  immune  systems  have been  compromised  as a result of chronic and acute
viral based infections and are receiving  medical care. The first market segment
targeted  by the Company is  patients  with HIV caused  AIDS  cases.  Management
believes that there is a significant demand and expanding market for RESURGEX(R)
and  PROSURGEX(TM)  because of the large  population  of HIV  infected  persons.
Nutritional  supplements  are  steadily  becoming  an  important  adjunct in the
treatment  of  people  living  with HIV and  AIDS.  Both  products  are  enteral
nutritional  supplements  targeted to nutritionally  support  immuno-compromised
individuals  undergoing  medical treatment for chronic  debilitating  conditions
that cause tissue wasting (weight loss), oxidative stress, mitochondrial failure
(fatigue/low energy) and immune dysfunction.

      In the  long  term,  the  Company  plans  to  expand  its  focus  on other
conditions where nutritional  support as an adjunct to medical care is required.
In addition, we plan to explore  RESURGEX(TM)(R) and PROSURGEX(TM)  applications
to the health market as a supplement to enhancing health and well being. Lastly,
the Company  plans to capitalize on the emerging  importance  and  popularity of
GliSODin(TM) by marketing a stand alone product in the mass market.

Intellectual Property

      Millennium  owns  all  rights  to  the  formulations  of  RESURGEX(R)  and
PROSURGEX(TM) and has filed a compositional  patent  application with respect to
these  formulations.  It also has filed for trademark  protection  for the names
"RESURGEX" and "PROSURGEX".  These applications are presently pending before the
United States Patent and Trademark Office.  On January 7, 2003,  RESURGEX(R) was
issued a Use and  Composition  Patent (United States Patent  6,503,506  Nutrient
therapy for  immuno-compromised  patients).  In addition,  the Company relies on
trade secrets and unpatented proprietary technology.  There is no assurance that
others may not independently try to develop


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<PAGE>

the same or similar  technology however they would be infringing upon our patent
and would not have access to an important proprieatary ingredient GliSODin(TM).

      On July 25, 2001,  Millennium  entered into an  exclusive  limited  patent
sublicense and distribution  agreement with Isocell SA, a French company,  which
owns  the  rights  to  the   combination  of  oral   administrable   SOD/gliadin
(GliSODin(TM)). Isocell SA also owns the United States patent for Pharmaceutical
compositions containing a Superoxide Dismutase which includes gliadin.  Pursuant
to the License  Agreement,  Millennium  is granted an  exclusive  sublicense  to
promote  and  distribute  GliSODin(TM)  for  use  as  a  dietary  supplement  or
functional  food in certain  defined  medical market channels of distribution in
North America involving direct sales of nutraceutical products to physicians for
resale to their patients or through physician prescription for Medicaid/Medicare
reimbursement for nutritional supplements.

      The License Agreement  provides for the sale of GliSODin(TM) to Millennium
at stated unit prices subject to volume discounts.  The term of the agreement is
for five  years,  provided  that  Isocell  may  cancel the  license  (or make it
non-exclusive)  in the event that  Millennium  purchases of  GliSODin(TM) do not
meet  agreed upon terms any  calendar  quarter  during the term.  In such event,
Millennium may avoid  termination of the license by paying 50% of the prescribed
purchase minimum.

Regulatory Environment

      The  manufacturing,   processing,  formulation,  packaging,  labeling  and
advertising  of  RESURGEX(R)  and  PROSURGEX(TM)  are subject to  regulation  by
federal agencies,  including the Food and Drug  Administration  (the "FDA"), the
Federal Trade  Commission,  the Consumer Product Safety  Commission,  the United
States  Department of  Agriculture,  the United  States  Postal  Service and the
United States Environmental Protection Agency. These activities are also subject
to  regulation  by various  agencies of the states and  localities  in which the
Company plans to sell RESURGEX(R) and PROSURGEX(TM).

      The "Dietary  Supplement  Health and  Education Act of 1994" (the "Dietary
Supplement   Law")   broadly   regulates   nutritional   labeling,   claims  and
manufacturing  requirements for dietary supplements.  The Dietary Supplement Law
provides for  regulation of Statements of  Nutritional  Support  ("Statements").
These  Statements  may be made if they are  truthful and not  misleading  and if
"adequate"  substantiation for the claims is available.  Statements can describe
claims of  enhanced  well-being  from use of the dietary  supplement  or product
statements  that  relate to  affecting  a  structure  or  function  of the body.
However,  Statements  cannot  claim to  diagnose,  treat,  cure,  or prevent any
disease,   regardless   of  the  possible   existence  of   scientific   reports
substantiating such claims.

      Statements appearing in dietary supplement labeling must be accompanied by
disclaimer  stating that the FDA has not evaluated the Statements.  Notification
to the FDA of these Statements is not considered approval of the Statements.  If
the FDA  determines  in possible  future  proceedings  that  dietary  supplement
Statements  fail to meet the  requirements  of the  Dietary  Supplement  Law,  a
product may be subject to regulation as a drug. The FDA retains all  enforcement
means available to it (i.e. seizure,  civil or criminal  penalties,  etc.), when
investigating or enforcing labeling claims.

      The Federal Trade  Commission  ("FTC")  regulates  advertising  of dietary
supplements such as RESURGEX(R) and PROSURGEX(TM).  The Federal Trade Commission
Act  prohibits  unfair or  deceptive  trade  practices  and false or  misleading
advertising.  The FTC has  recently  been  very  active  in its  enforcement  of
advertising  against  manufacturers  and  distributors  of  nutritional  dietary
supplements  having instituted several  enforcement  actions resulting in signed
agreements  and payment of large  fines.  Although  the Company has not been the
target of a FTC  investigation,  there can be no assurance that the FTC will not
investigate the Company's advertising in the future.

      The  Company  is  unable  to  predict  the  nature  of  any  future  laws,
regulations,  interpretations,  or applications,  nor can it predict what effect
additional  governmental  regulations  or  administrative  orders,  when  and if
promulgated,


                                                                               9
<PAGE>

would have on its  business in the  future.  They  could,  however,  require the
reformulation of certain products not possible to be reformulated, imposition of
additional record keeping requirements, expanded documentation of the properties
of  certain   products,   expanded  or   different   labeling   and   scientific
substantiation regarding product ingredients,  safety or usefulness.  Any or all
such requirements  could have a material adverse effect on the Company's results
of operations and financial condition.

Medicaid Reimbursement

      Approval for reimbursement by state Medicaid programs is important for the
marketing  efforts  undertaken by the Company.  To that effect,  Millennium  had
applied  for and has  gained  inclusion  into the First Data Bank  ("FDB").  FDB
provides pharmaceutical and nutraceutical pricing and product information to all
50 states,  as well as the District of Columbia.  FDB, a wholly owned subsidiary
of the  Hearst  Corporation,  is the  world's  leading  supplier  of  healthcare
knowledge databases,  supplying drug knowledge to over 40,000 pharmacies,  4,000
hospitals,  all 50 state  Medicaid  programs and  virtually all major vendor and
private  drug  benefit   programs.   The  majority  of  drug   wholesalers   and
manufacturers also use one or more of its products. Inclusion in FDB facilitates
access to all state  Medicaid  programs,  Managed Care  Organizations  and other
important health care and reimbursement organizations.

      With  inclusion  in  FDB,  some  state  Medicaid   organizations   qualify
RESURGEX(R) and  PROSURGEX(TM)  automatically  under the open formulary  system.
Other states, require a more formal application process, among them the State of
New York.  Millennium  has applied for  approval by Medicaid and ADAP (Aids Drug
Assistance  Program)  for the  State of New York.  In  addition,  it is  selling
RESURGEX(R)   and/or   PROSURGEX(TM)   to  physicians  and  obtaining   Medicaid
reimbursement  in New Jersey,  Connecticut,  California,  Nevada,  Pennsylvania,
Maine,  and  Michigan.  It is  important  to  note  that  both  RESURGEX(R)  and
PROSURGEX(TM)  have been  assigned  Federal  HCPCS  Codes  from the  Centers  of
Medicaid  and  Medicare   Services.   Some  states  require  HCPCS  codes  as  a
prerequisite before a formal Medicaid reimbursement application is accepted.

Marketing Strategy

      Millennium  will seek to build  awareness  and brand name  recognition  by
cooperating  with recognized  researchers and scientists that are most likely to
advocate   proactive   approaches  to   therapeutic   treatments.   While  these
relationships  bring to the Company valuable  expertise they will be sought also
to potentially  facilitate the successful  demonstration  of the benefits gained
from the use of Millennium's products.

      It is  management's  belief  a  successful  marketing  strategy  for  both
RESURGEX(R)  and  PROSURGEX(TM)   emphasizes   support  of  Medicaid  and  other
organizations that provide reimbursement  programs.  Support in this sense means
that Medicaid  includes both  RESURGEX(R) and  PROSURGEX(TM)  in its universe of
products  that  qualify  for  reimbursement   when  prescribed  by  the  medical
profession.  Currently both RESURGEX(R) and  PROSURGEX(TM) are included in First
Data Bank, which translates to Medicaid  coverage in states,  which subscribe to
the open formulary categorization of including products on their formulary. Both
RESURGEX(R)  and  PROSURGEX(TM)  are  included for  reimbursement  and are being
marketed in the states of New Jersey,  Connecticut,  Michigan, Maine and Nevada.
Both products have been covered through the prior authorization procedure in the
state of Pennsylvania. The Company launched a sales campaign for RESURGEX(R) and
PROSURGEX(TM)   in  the  State  of  Pennsylvania   on  September   13th,   2002.
PROSURGEX(TM) is covered in California  under the Medi-Cal  system.  Separately,
the Company has moved to obtain  approval by Medicaid and ADAP in New York,  the
state that represents the most important  market segment that does not currently
subscribe  to the open  formula  categorization  of the  products for purpose of
reimbursement   qualification.   Management   anticipates  product  launches  in
additional states during the next quarter.

      The tri-state New York geographical area accounts for a substantial number
of the persons affected by immune systems  dysfunction in the United States. The
Company's  goal is to reach a minimum of ten percent of this market within three
years.


                                                                              10
<PAGE>

Competition

      There are many other  nutraceutical  products on the market that have been
approved for Medicaid  reimbursement in various states as dietary supplements in
the field of  immuno-deficiencies.  However,  RESURGEX(TM)  is the only  product
available that features the patent-protected SOD/Gliadin formulation. Millennium
has the exclusive right to market and distribute  SOD/gliadin in certain defined
medical markets in the North America. There can be no guaranty,  however, that a
competitive product will not emerge with features and  characteristics  that are
superior to those of RESURGEX(TM)

Product Production

      All manufacturing,  warehousing and distribution  functions are outsourced
to various vendors and suppliers.

Seasonality and Dependency

      The industry segment in which the Company does business is not seasonal.

Employees

      As of December 31, 2002, the Company  employed 10 persons,  of whom 2 were
primarily engaged in research and development and product support activities,  3
were primarily engaged in sales and marketing,  and 5 in general  administrative
and managerial  functions.  The Company has no collective  bargaining agreements
with its employees.

ITEM 2: PROPERTIES

      The Company  leases  certain  office space and equipment  under  operating
leases.

      The Company's administrative facilities are located in approximately 2,200
square feet of leased  office space in  Bernardsville,  New Jersey,  as to which
Millennium  entered  into a 5 year lease,  starting  January 1, 2001.  The lease
calls for a monthly rent of $5,807 plus allocated expenses.

      In October 2001, the Company signed a 5-year lease  commencing in November
2002, for approximately 4,500 square feet of office space at a monthly rental of
$10,000 plus an allocated  portion of certain  operating  expenses.  The Company
intends to occupy these  facilities  in the spring of 2003.  This lease has been
personally guaranteed by an officer of the Company.

ITEM 3: LEGAL PROCEEDINGS

      As of December  31, 2002 the Company was the subject of a claim for unpaid
consulting  fees in the amount of  approximately  $23,000.  The  Company and the
consultant  settled  on April 9, 2003.  The  Company is not a party in any legal
proceedings.

ITEM 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      No matters were  submitted to a vote of the  security  holders  during the
fourth quarter of this fiscal period.


                                                                              11
<PAGE>

                                     PART II

ITEM 5: MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
        SHAREHOLDER MATTERS

(a) Market Information

      The Company's  common stock  currently  trades on the Electronic  Bulletin
Board of the OTC market,  under the symbol MBTG. The following table sets forth,
for the calendar  quarters  indicated during the last two fiscal years, the high
and low  quotations  of the  Company's  common  stock.  The  quotations  reflect
inter-dealer prices,  without retail mark-up,  mark-down,  or commission and may
not  represent  actual  transactions.  The market for the common  stock has been
sporadic and there have been long  periods  during which there were few, if any,
transactions  in the  common  stock  and no  reported  quotations.  Accordingly,
reliance  should not be placed on the  quotes  listed  below,  as the trades and
depth of the market may be limited, and therefore, such quotes may not be a true
indication of the current market value of the Company's common stock.

      The  quotations for the four periods in 2001 and the first quarter in 2002
reflect prices for the Company's common stock, unadjusted for the effects of the
reverse split of the common shares on a one-for-twelve basis, on April 1, 2002.

                                                        OTC-BB
                                                        ------
                                               High/Ask        Low/Bid
                                               --------        -------
2001

         First Quarter .................       $  0.63         $ 0.38
         Second Quarter ................          0.66           0.31
         Third Quarter .................          0.54           0.45
         Fourth Quarter ................          0.15           0.07

2002

         First Quarter .................       $  0.50         $ 0.16
         Second Quarter ................          3.35           0.51
         Third Quarter .................          2.25           0.67
         Fourth Quarter ................          0.95           0.30

(b) Shareholders

      As of March 31, 2003, there were  approximately 390 shareholders of record
for the Company's  Common Stock.  The number of record  holders does not include
shareholders whose securities are held in street names. The company estimates an
additional 1,000 shareholders hold securities in street name. In addition, there
were  approximately  10 holders of record of the Company's  Series B Convertible
Preferred  Stock and 67 holders of record of the  Company's  Series C  Preferred
Stock.

(c) Dividends

      The Company has not declared or paid, nor has it any present  intention to
pay, cash  dividends on its common stock.  No cash  dividends may be declared or
paid on the  Company's  Common  Stock if, and as long as, the Series B Preferred
Stock is  outstanding  or there are unpaid  dividends on  outstanding  shares of
Series C Preferred Stock. No


                                                                              12
<PAGE>

dividends  may be declared  on the Series C Preferred  Stock if, and as long as,
the Series B Preferred  Stock is  outstanding.  Accordingly,  it is unlikely the
Company will declare any cash dividends in the foreseeable future.

Recent Issues of  Unregistered Securities

      During the fourth  quarter of 2002 the  Company  had issued the  following
unregistered securities:

      (i) (a) $128,750 worth of 2-year convertible promissory notes, convertible
at the  holders'  option into  shares of common  stock at the price of $0.25 per
share, to ten accredited  investors pursuant to private placement  subscriptions
under Section 4(2),  Rule 506 of Regulation D of the  Securities  Act; and (b) a
promissory note for $50,000.00 which matures after 120 days and which, if unpaid
at maturity, may be converted at the holder's option into shares of common stock
at the price of $0.10 per share; all such transactions  resulting in the receipt
by the Company of an aggregate $178,750 in cash;

      (ii) 100,000 shares of common stock to an accredited  investor pursuant to
a private placement subscription under Section 4(2), Rule 506 of Regulation D of
the  Securities  Act, which resulted in the receipt by the Company of $25,000 in
cash;

      (iii)  Warrants  for the  purchase  of  125,000  shares of  common  stock,
exercisable  at  the  price  of  $0.01  per  share,  to a  private  investor  in
consideration  of his purchase of a promissory  note (see (i)(b)  above).  These
warrants were exercised in December 2002 and resulted in the issuance of 125,000
restricted common shares.

      (iv)  Warrants  for  the  purchase  of  70,000  shares  of  common  stock,
exercisable at the price of $0.50 per share, to a private investor in connection
with his purchase of a $125,000 promissory note.

      (v)  Warrants  for the  purchase of 250,000  shares to five  officers  and
directors of the Company, and for the purchase of 30,000 shares to one employee,
pursuant  to grants  authorized  by the board of  directors;  all such  warrants
exercisable at the price of $0.50 per share;

      (vi) 44,764 shares of common stock to a creditor  against  cancellation of
$22,382 current liabilities;

      (vii)  341,668  shares of common  stock to two  consultants  for  investor
relations services rendered.

      (viii)  157,242  shares of common stock to a lender in return for a series
of 6-months term loans aggregating $212,500, bearing interest at the rate of 10%
p.a.;  and  10,606  shares  to the same  lender  in lieu of  $3,500  in  accrued
interest.

Information  about  common stock that may be issued upon the exercise of options
and  warrants is  contained in the Notes to  Consolidated  Financial  Statements
attached hereto.


                                                                              13
<PAGE>

ITEM 6: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
        CONDITION AND RESULTS OF OPERATIONS

CAUTIONARY  STATEMENT PURSUANT TO "SAFE HARBOR" PROVISIONS OF SECTION 21E OF THE
SECURITIES EXCHANGE ACT OF 1934

      Except for historical information, the Company's reports to the Securities
and  Exchange  Commission  on Form  10-KSB and Form  10-QSB and  periodic  press
releases,   as  well  as  other  public   documents  and   statements,   contain
"forward-looking statements" within the meaning of Section 21E of the Securities
Exchange  Act of 1934.  Forward-looking  statements  are  subject  to risks  and
uncertainties  that could cause actual results to differ  materially  from those
expressed or implied by the statements.  These risks and  uncertainties  include
general economic and business  conditions,  development and market acceptance of
the Company's  products,  current  dependence on the willingness of investors to
continue to fund  operations  of the  Company and other risks and  uncertainties
identified in the Company's  reports to the Securities and Exchange  Commission,
periodic press releases, or other public documents or statements.

      Readers  are  cautioned  not to place undue  reliance  on  forward-looking
statements.  The  Company  undertakes  no  obligation  to  republish  or  revise
forward-looking  statements to reflect  events or  circumstances  after the date
hereof or to reflect the occurrences of unanticipated events.

      The  selected  financial  information  presented  below under the captions
"Statement of Operations"  and "Balance  Sheet" for the years ended December 31,
2002 and 2001 is derived from the financial statements of the Company and should
be read in conjunction with the financial statements and notes thereto.

      The financial  data are those of Millennium  Biotechnologies  Group,  Inc.
including the operations of Millennium  Biotechnologies,  Inc. All inter-company
accounts and transactions have been eliminated in consolidation.

     SELECTED FINANCIAL DATA

     Balance Sheet                                            December 31,
                                                              ------------
                                                                   2002
                                                              -----------
      Total assets ....................................       $   622,305
      Current liabilities .............................         1,764,231
      Long-term debt ..................................           128,750
      Working capital .................................        (1,308,653)
      Shareholders' equity (impairment) ...............       $(1,270,676)

     Statement of Operations                  For the Year Ended December 31,
                                              -------------------------------
                                                   2002             2001
                                              -------------     -------------
     .
      Total revenues .......................  $    675,080      $     79,342
      Operating income (loss) ..............    (3,067,428)       (1,686,589)

      Net (loss) ...........................    (3,205,419)       (1,711,430)

      Net loss per common share ............  $      (0.19)     $      (0.14)
      Number of shares used in computing
      per share data .......................    16,772,410        12,463,515



                                                                              14
<PAGE>

Results of Operations for the year ended December 31, 2002:

During the quarter ended  December 31, 2002 the Company  continued to market and
record orders for Millennium's RESURGEX(R) and PROSURGEX(TM) products.  Revenues
for the year ended  December  31, 2002  amounted  to  $675,080  whereby all such
revenues were generated from the Company's  wholly owned  subsidiary  Millennium
Biotechnologies,  Inc.  These  revenues  resulted  entirely  from  the  sales of
RESURGEX(R)  and  PROSURGEX(TM).  If measured  against  annual  revenue in 2001,
annual  revenue in 2002 saw a  significant  increase  in revenues  derived  from
RESURGEX(R) and PROSURGEX(TM).  Revenues generated from the sales of RESURGEX(R)
and PROSURGEX(TM)  during 2002 increased by 750% ($675,080  compared to $79,372)
over 2001. It is important to note, however, that sales of RESURGEX(R) commenced
only in September of 2001 and sales of PROSURGEX(TM) commenced only in August of
2002.

This  revenue  figure   represents   orders  through  not  yet  fully  developed
distribution  channels.  Management  believes  that future  quarters  will see a
marked  acceleration in product sales as existing  channels mature and access to
more  state  Medicaid  programs  is  achieved.  At this  stage in the  Company's
development,  revenues  are  not  yet  sufficient  to  cover  ongoing  operating
expenses.

Gross  profits  during the twelve  months ended  December  31, 2002  amounted to
$100,300 for a 15% gross margin. After deducting selling expenses,  research and
development  expenses  andgeneral and administrative  expenses of $3,167,728 the
Company realized an operation loss of $3,067,428. Non-operating expenses totaled
$269,529.  The net result for the twelve months period ended  December 31, 2002,
was a loss of $3,205,419 or $0.19 per share.

The period's net result was significantly  affected by the need for expenditures
in connection  with setting up the required  marketing  and sales  operations as
well as the supporting  administrative  infrastructure,  resulting in relatively
high operating  expenses.  Management  does not consider this atypical for a new
company  engaged in launching new products.  The Company will continue to invest
in further expanding its operations and a comprehensive  marketing campaign with
the goal of  accelerating  the education of potential  clients and promoting the
name and products of the Company.

In 2002 Millennium  recorded  significant  accomplishments in the development of
sales  and  distribution   channels  for  both  RESURGEX(R)  and  PROSURGEX(TM).
PROSURGEX(TM)  completed its research and  development  cycle and was brought to
market in August of 2002. Both products  obtained  Federal HCPCS codes which are
issued by the Centers for Medicare and Medicaid.  HCPCS codes are  prerequisites
for Medicaid  approval in certain states.  During 2002,  five additional  States
qualified   RESURGEX(R)   and/or   PROSURGEX(TM)  for  reimbursement  -  Nevada,
California, Maine, Michigan and Pennsylvania. These States joined New Jersey and
Connecticut  which  reimbursed  RESURGEX(R)  already  in 2001.  Millennium  also
advanced its  distribution  channels by negotiating and engaging in distribution
relationships with national  pharmaceutical  wholesalers such as Cardinal Health
and McKesson Corporation. In addition a national marketing campaign was launched
through  full  page  advertisements  in POZ  Magazine  the  leading  publication
associated  with HIV/AIDS with a nationwide  circulation  approximately  125,000
issues per month.  The marketing  campaign was designed to develop direct access
markets and to promote  general  awareness about the Company's  products.  As of
December 31, 2002 over 250 pharmacies in 7 states dispensed  either  RESURGEX(R)
or PROSURGEX(TM).

In 2003 the Company plans to further expand distribution channels by introducing
RESURGEX(R)  and  PROSURGEX(TM)  to a larger number of  pharmacies,  in order to
expand access of the products to retail clients. The Company plans to streamline
operations  and  production  processes  which is expected to lower cost of goods
sold and result in significantly  higher gross margins.  Management is confident
that it can develop strong distribution channels


                                                                              15
<PAGE>

through  physicians and pharmacies and a direct access  program,  through a more
diversified  pricing strategy and the pursuit of qualification for reimbursement
in additional Medicaid markets.

Liquidity and Capital Resources

In view of the start-up  nature of the  Company's  business at this stage of its
development,  its operations were generally  financed by new equity  investments
through private  placements with accredited  investors.  Such equity investments
totaled  $806,806  and  supplied  the  majority of the funds that were needed to
finance  operations  during the  reporting  period.  In  addition,  the  Company
obtained funding through loans from accredited  investors totaling $796,678 some
of which include certain  non-interest  bearing and interest bearing convertible
promissory  notes,  convertible into common shares at the option of the holders.
These funds covered the negative cash flow from operations  only partially,  and
were not sufficient to build up a liquidity reserve.  As a result, the Company's
financial position was impaired,  with working capital at the end of the quarter
showing a deficit of $1,308,653.  Due to the Company's  financial  condition the
Company's auditors have included a going concern explanatory  paragraph in their
report.  The Company can only  continue as a going  concern in the event that it
obtains additional capital.

Management is currently in discussions  with several entities in order to obtain
additional financing to support the Company's further growth. Management expects
but cannot  assure  that it will be able to meet the  Company's  capital  needs,
until such time when cash flow from sales  increases  to an extent  that it will
meet requirements from operations.


                                                                              16
<PAGE>

ITEM 7: FINANCIAL STATEMENTS

      The Company's Financial  Statements and Notes to Financial Statements have
been prepared in accordance  with the  requirements of Item 310(a) of Regulation
S-B and are and are included at the end of this Annual Report on Form 10-KSB.

ITEM 8: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
        ACCOUNTING AND FINANCIAL DISCLOSURE

      As reported by the Company in its Form 8-K filed on October 10, 2001,  the
Company  dismissed  its  former  independent  accountants,  the firm of  Wiener,
Goodman & Company,  P.C.,  and appointed  the  accountants  for its  subsidiary,
Millennium,  the  firm of  Rosenberg  Rich  Baker  Berman  and  Company,  as the
Company's independent auditors.

      There  have been no  changes  in or  disagreements  with the  Registrant's
independent auditors during the last two years.


                                                                              17
<PAGE>

                                    PART III

ITEM 9: DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
        PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

The names of all directors and executive officers of the Company are as follows:

<TABLE>
<CAPTION>
        Name                       Position                              Term(s)  of Office
---------------------    ------------------------------------        --------------------------

<S>                      <C>                                         <C>
Jerry E. Swon, 53        President, Chief Executive Officer,         Jul.27, 2001 until present
                         Chairman of the Board of the Company

Bruce L. Deichl, 55      Chief Operating Officer and                 Jul.27, 2001 until present
                         Director of the Company,
                         Secretary

Frank Guarino, 28        Chief Financial Officer                     Oct.15, 2001 until present

Michael G. Martin, 51    Company Director                            Oct.15, 2001 until present

David Sargoy, 43         Company Director                            Oct.15, 2001 until present

Carl Germano, 48         Executive Vice President, Research          May 15, 2001 until present
                         and Product Development

John Swon, 28            Vice President, Business Development        Apr.1, 2001 until present

Jerry T. Swon, 25        Assistant Vice President,                   Apr.1, 2001 until present
                         Sales & Marketing
</TABLE>

----------
Jerry E. Swon is the father of John Swon and Jerry T.  Swon.  There are no other
family  relationships among the Company's officers and directors.  All directors
hold office until the next annual meeting of  stockholders  and the election and
qualification  of their  successors.  Vacancies on the Board of Directors may be
filled by the remaining directors until the next annual  stockholders'  meeting.
Officers serve at the discretion of the Board.

A summary of the business  experience  for each of our officers and directors is
as follows:

Jerry E. Swon

      Mr. Swon, a founder of  Millennium,  has been  Millennium's  President and
Chief Executive Officer since its formation, and the Company's President,  Chief
Executive  Officer  and  Chairman  of the Board  since July 27,  2001.  Prior to
joining Millennium,  and since 1992, Mr. Swon was the Chief Executive Officer of
Royal  Capital  Inc.,  a New Jersey  based  company,  which  provided  financial
consulting and corporate  structuring  services to private and public companies.
In 1998,  Mr.  Swon  served as Chief  Executive  Officer  and as a  Director  of
Magnitude  Information  Systems  Inc.,  a  company  engaged  in the  design  and
development  of ergonomic  software for office  uses.  Mr. Swon  received a B.A.
degree from Hamline University in 1972.


                                                                              18
<PAGE>

Bruce L. Deichl

      Mr. Deichl, a founder of Millennium, has been Millennium's Chief Operating
Officer  since  its  formation,  and  the  Company's  Chief  Operating  Officer,
Secretary and a Director  since July 27, 2001.  Since 1998,  Mr. Deichl has been
the  President  of  Tax  Transfer  Corp.,  a  private  company  engaged  in  the
structuring  and  placement  of tax losses for small tech and biotech  companies
located in the State of New Jersey.  In 1998, Mr. Deichl served as a Director of
Magnitude  Information Systems,  Inc. Mr. Deichl has also been an executive vice
president  of Royal  Capital  Inc.  since  1996.  Mr.  Deichl  earned a B.A.  in
Economics from the University of Notre Dame in 1969.

Frank Guarino

      Mr. Guarino has been  Millennium's  Chief Financial  Officer since October
15,  2001.  Mr.  Guarino was  previously  employed  from  December  1997 through
February  2001 as the  Controller  for First  National  Funding  Corporation  of
America, a mortgage banking firm with 55 branches nationwide producing over $350
million  dollars  in annual  volume at the time of his  departure.  Mr.  Guarino
earned a BS degree in Accounting from St. Peter's College in 1997.

Michael G. Martin

      Mr. Martin was appointed a Director of the Company on October 15, 2001. In
1991, Mr. Martin  founded  Magnitude,  Inc.  (then known as Proformix,  Inc.), a
company engaged in the design and  development of ergonomic  software for office
uses. Mr. Martin served as the Chairman and President of Magnitude, Inc. and its
parent,  Magnitude  Information  Systems Inc.  from 1991 until 1999.  Since June
2000,  Mr.  Martin has served as the  director of business  development  for the
Behrle Group, a regional  interior office design company.  Mr. Martin received a
B.A. degree from Bloomsburg State College in 1972.

David Sargoy

      Mr.  Sargoy was  appointed a Director of the Company on October 15,  2001.
From  January  1997 to the  present,  Mr.  Sargoy  has  been a  Director  of the
commercial  real estate  division of Brown Harris  Stevens.  Prior to 1997,  Mr.
Sargoy was a partner in Willrock L.I.  Inc., a commercial  real estate  company.
Mr. Sargoy received a Bachelor of Science degree from Ithaca College in 1979 and
an M.B.A. from Washington University in 1981.

Carl Germano

      Mr. Germano serves as Millennium's Executive Vice President of New Product
Development & Research. He is a registered, certified and licensed nutritionist.
Mr.  Germano  holds a  master's  degree  in  clinical  nutrition  from  New York
University  and has over 22 years  experience  using  innovative,  complementary
nutritional  therapies  in  private  practice.  For  the  last 15  years  he has
dedicated his efforts to research and product  development  for the  nutritional
supplements  industry,  where he has been instrumental in bringing  cutting-edge
nutritional  substances  and  formulations  to  the  health/dietary   supplement
industry. From April 1999 to July 2001, Mr. Germano was Senior Vice President of
Research  and Product  Development  for  Nutratech,  Inc., a  nutraceutical  raw
materials  supplier.  From  1992 to  1999,  he was  Vice  President  of  Product
Development  and  Research  for Solgar  Vitamin and Herb, a division of American
Home Products Corporation.

John Swon

      Mr. Swon has been  Millennium's  Vice  President  of Business  Development
since April 1, 2001.  Mr. Swon was employed by Tax Transfer  Corporation  of New
Jersey from October 1998 to March 2001.  During that period he also was employed
by Royal Capital Inc. Mr. Swon received a BA in Government from Skidmore College
in 1998.


                                                                              19
<PAGE>

Jerry T. Swon

      Mr.  Swon  has  been  Millennium's  Assistant  Vice  President  of Sales &
Marketing  since  April  2001.  He has been  employed  by  Millennium  since its
inception.  Mr. Swon received a BS in Business  Management from Skidmore College
in 2000.

Compensation of our Directors

      During 2002, each of the Company's directors received warrants to purchase
50,000  shares of our common  stock at an exercise  price of $0.50 per share for
their services as advisors of the Company and members of our board of directors.
The warrants  have certain  piggy-back  registration  rights.  Directors who are
non-officers  or   non-employees   may,  at  our  discretion,   receive  nominal
compensation to cover travel costs.

Employment Agreements

Jerry E. Swon

      Pursuant to an employment agreement, dated April 1, 2001, with Millennium,
Jerry Swon is entitled to a base salary of $150,000 per year pro rated for 2001;
$250,000 per year for 2002;  and $300,000 per year for the following  years.  In
the first year of the term, payment of up to 40% of Mr. Swon's base salary shall
be deferred until such time as Millennium,  in its reasonable judgment,  has the
financial resources to pay such deferred compensation.  Millennium  acknowledges
deferred  compensation  due to Mr.  Swon as of July 31,  2001,  in the amount of
$45,000 for services  rendered  prior to July 31, 2001.  In addition to the base
salary  Millennium  may pay an annual bonus during each year of the term, at its
sole discretion. Mr. Swon also receives a monthly expense allowance.

Bruce L. Deichl

      Pursuant to an employment agreement, dated April 1, 2001, with Millennium,
Bruce  Deichl is entitled  to a base  salary of $150,000  per year pro rated for
2001; $250,000 per year for 2002; and $300,000 per year for the following years.
In the first year of the term,  payment of up to 40% of Mr. Deichl's base salary
shall be deferred until such time as Millennium, in its reasonable judgment, has
the  financial   resources  to  pay  such  deferred   compensation.   Millennium
acknowledges deferred compensation due to Mr. Deichl as of July 31, 2001, in the
amount of $45,000 for services  rendered  prior to July 31, 2001. In addition to
the base salary Millennium may pay an annual bonus during each year of the term,
at its sole discretion. Mr. Deichl also receives a monthly expense allowance.

Carl Germano

      Pursuant to a five-year  employment  agreement,  dated May 18, 2001,  with
Millennium,  Carl  Germano was  appointed  Senior Vice  President of New Product
Development & Research. He is entitled to a base salary of $200,000 per year. In
addition to the base  salary  Millennium  will pay Mr.  Germano a bonus equal to
..008 of the gross proceeds from the sales of RESURGEX(TM) and PROSURGEX(TM) each
calendar quarter and .008 of the gross profits of other Millennium products.  He
also received options to purchase 26,365.6 shares of D Preferred Stock at $20.00
per share of which 20% vested upon the signing of the  employment  agreement and
the balance vest 20% per year.  Mr.  Germano also receives a monthly  automobile
allowance.

John Swon

      Pursuant to a three-year  employment  agreement,  dated May 1, 2001,  with
Millennium,  John Swon was appointed Vice President of Business Development.  He
is entitled to a base  annual  salary of $50,000  during the first year with 10%
annual increases each year thereafter. In addition to the base salary Millennium
will pay Mr. Swon a bonus equal to .01663 of the gross  proceeds  from the sales
of RESURGEX(TM) and PROSURGEX(TM) and .01663 of the gross profits


                                                                              20
<PAGE>

of other Millennium products.  He also received options to purchase 6,250 shares
of D Preferred Stock at $20.00 per share.

Jerry T. Swon

      Pursuant to a three-year  employment  agreement,  dated May 1, 2001,  with
Millennium,  Jerry T. Swon was appointed  Assistant  Vice President of Marketing
and Sales.  He is entitled to a base annual  salary of $50,000  during the first
year with 10% annual  increases  each year  thereafter.  In addition to the base
salary  Millennium  will pay Mr.  Swon a bonus  equal  to  .01663  of the  gross
proceeds  from the sales of  RESURGEX(TM)  and  PROSURGEX(TM)  and .01663 of the
gross profits of other Millennium products. He also received options to purchase
6,250 shares of D Preferred Stock at $20.00 per share.

Compliance with Section 16(a) of the Securities Exchange Act of 1934

      To our  knowledge,  based  solely  on a review  of such  materials  as are
required by the  Securities  and Exchange  Commission,  no officer,  director or
beneficial holder of more than ten percent of our issued and outstanding  shares
of  common  stock  failed to file in a timely  manner  with the  Securities  and
Exchange  Commission  any form or report  required  to be so filed  pursuant  to
Section  16(a) of the  Securities  Exchange  Act of 1934  during the fiscal year
ended December 31, 2002.


                                                                              21
<PAGE>

ITEM 10: EXECUTIVE COMPENSATION

      The  following  table  sets  forth  the cash  compensation  and  executive
capacities for the fiscal years ended December 31, 2002,  December 31, 2001, and
December  31,  2000,  for the chief  executive  officer  and for each  executive
officer whose aggregate cash remuneration  exceeded $100,000,  for all executive
officers as a group, and for certain other most highly compensated employees:

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------------
                                                                       Other             Restricted     Securities       All
         Name and                                                      Annual             Stock        Underlying       Other
    Principal Position       Year       Salary ($)    Bonus ($)     Compensation($)      Awards ($)    Options ($)    Compens.($)
    ------------------       ----       ----------    ---------     ---------------      ----------    -----------    -----------
                                           (1)                            (2)                              (3)
---------------------------------------------------------------------------------------------------------------------------------
<S>                          <C>         <C>                <C>         <C>                  <C>            <C>             <C>
Jerry E. Swon (4)            2002        132,308            --          10,500               --             --              --
Chief Executive Officer,     2001        109,885            --          13,500               --             --              --
President                    2000             --            --              --               --             --              --
---------------------------------------------------------------------------------------------------------------------------------
Bruce L. Deichl (5)          2002        132,308            --          10,500               --             --              --
Chief Operating Officer,     2001        109,885            --          13,500               --             --              --
Secretary                    2000             --            --              --               --             --              --
---------------------------------------------------------------------------------------------------------------------------------
Frank Guarino (6)            2002         70,000            --           6,000               --             --              --
Chief Financial Officer      2001         10,769            --             500               --             --              --
                             2000             --            --              --               --             --              --
---------------------------------------------------------------------------------------------------------------------------------
Carl Germano (7)             2002        200,000            --          10,800               --             --              --
Exec. Vice President         2001        121,685            --          00,000               --             --              --
                             2000             --            --              --               --             --              --
---------------------------------------------------------------------------------------------------------------------------------
All executive officers
as a group (4 persons)       2002        534,616            --          37,800               --             --              --
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>

----------

(1)   The value of other  non-cash  compensation,  except  for the items  listed
      under (2), (3), (4) and (5), that was extended to or paid for  individuals
      named above did not exceed 10% of the aggregate cash  compensation paid to
      such individual, or to all executive officers as a group.

(2)   Consists  of  automobile  expenses  allowances.

(3)   See table for "Stock Options and Warrants" below.

(4)   Not  included  in the figures for 2002 are  $117,692  deferred  salary and
      $7,500 accrued unpaid automobile expense allowance. The 2001 salary figure
      includes $25,000 paid to Mr. Swon for services in the period from November
      2000 through March 2001 under a consulting arrangement.  In 2002, Mr. Swon
      received  warrants  to  purchase  50,000  common  shares  of the  Company,
      exercisable at $0.50 per share, and in 2001,  warrants to purchase 133,333
      shares (1,600,000  pre-4/1/02 reverse split) common shares of the Company,
      exercisable  during five years at $0.50 ( $0.25 pre-4/1/02  reverse split)
      per share.

(5)   Not  included  in the figures for 2002 are  $117,692  deferred  salary and
      $7,500 accrued unpaid automobile expense allowance. The 2001 salary figure
      includes  $25,000  paid to Mr.  Deichl for  services  in the  period  from
      November 2000 through March 2001 under a consulting arrangement.  In 2002,
      Mr.  Deichl  received  warrants to purchase  50,000  common  shares of the
      Company, exercisable at $0.50 per share, and in 2001, warrants to purchase
      133,333 shares (1,600,000  pre-4/1/02  reverse split) common shares of the
      Company, exercisable during five years at $0.50 ( $0.25 pre-4/1/02 reverse
      split) per share.

(6)   In 2002, Mr. Guarino received warrants to purchase 30,000 common shares of
      the Company, exercisable at $0.50 per share.

(7)   In 2002, Mr. Germano received warrants to purchase 50,000 common shares of
      the  Company,  exercisable  at $0.50 per share,  and  warrants to purchase
      180,342 common shares, exercisable at $0.37 per share.

Stock Options /Stock Purchase Warrants:

      The following table sets forth options and stock purchase warrants granted
during  2002,  to  executive  officers,  certain  other  employees  with highest
remuneration,  directors,  and beneficial  owners of more than 10 percent of any
class of equity securities of the Company:

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------
                         Number of Common      % of Total Warrants
                         Shares Underlying     Granted to Employees
                         Options and           and Directors              Exercise         Expiration
Name                     Warrants Granted      in FY 2002                 Price ($/Sh.)    Date                .
-----------------------------------------------------------------------------------------------------
<S>                          <C>                <C>                        <C>              <C>
Jerry E. Swon                50,000                8.9%                    0.50             10/30/07
Bruce Deichl                 50,000                8.9%                    0.50             10/30/07
Carl Germano                 50,000               59.1%                    0.50             10/30/07
Carl Germano                281,767             see above                  0.37             5/18/07
Frank Guarino                30,000                5.3%                    0.50             1030/07
Michael G. Martin            50,000                8.9%                    0.50             10/30/07
David Sargoy                 50,000                8.9%                    0.50             10/30/07
</TABLE>


                                                                              22
<PAGE>

      There were no  exercises  of stock  options  or  warrants  during  2002 by
executive  officers,  other  employees with highest  remuneration,  directors or
beneficial  owners of more than 10 percent of any class of equity  securities of
the Company:

Compensation of Directors:

      The Company currently pays no outside directors' fees.

      On October 30,  2002,  the board of  directors  of the Company  approved a
resolution  pursuant to which the exercise price of warrants for the purchase of
a total  533,332  shares of the common  stock of the  Company,  held by the four
directors,  was reduced from $3.00 to $0.50. This change was enacted in order to
retain the incentive  character of such warrants,  in view of market  conditions
that adversely affected the price for the common stock.

AUDIT COMMITTEE

      The  Company has  appointed  an Audit  Committee  in  accordance  with the
provisions  of the  Sarbanes-Oxley  Act of 2002,  comprised  of two  independent
outside directors of the Company,  one of whom, M. Martin, is a financial expert
with knowledge of financial statements, generally accepted accounting principles
and accounting procedures and disclosure rules.

CORPORATE GOVERNANCE AND CODE OF ETHICS

      The Company has always been  committed to good  corporate  governance.  In
furtherance  of this  commitment,  in  February  2003  the  Board  of  Directors
appointed an Audit Committee whose duties  specifically  include  responsibility
and  oversight of corporate  governance  matters and  adherence to the Company's
Code of Ethics.

      A copy of the  Corporate  Code of Ethics  and  Conduct  is set forth as an
exhibit to this Form 10-KSB and may be obtained  free of charge by  submitting a
request in writing to the Company at the address shown on the first page of this
report.


                                                                              23
<PAGE>


ITEM 11: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
         MANAGEMENT AND RELATED STOCKHOLDER MATTERS

      The  following  table sets  forth,  as of March 31,  2003,  the record and
beneficial  ownership of common stock of the Company by each  executive  officer
and director,  all executive  officers and directors as a group, and each person
known to the Company to own beneficially,  or of record, five percent or more of
the outstanding shares of the Company:

<TABLE>
<CAPTION>
Title       Name and Address of                         Amount and Nature of               Percent
of Class    Beneficial Owner                            Beneficial Ownership (1)           of Class
---------   ----------------                            ------------------------           --------
<S>         <C>                                          <C>                                <C>
Common      Jerry E. Swon                                    183,333(2)                     **
Stock       Bruce Deichl                                     183,333(3)                     **
            Frank Guarino                                     30,000(4)                     **
            Carl Germano                                   1,078,635(5)                     5.49%
            Michael G. Martin                                183,333(6)                     **
            David Sargoy                                     203,371(7)                     **
            Jane Swon                                      4,102,340(8)                     20.75%
            P. Elayne Wishart                              3,988,791(9)                     20.17%
            David Miller                                   2,386,700(10)                    12.63%

            All Directors and Executive Officers           1,862,005                        9.13%
            as a Group (6 persons)
</TABLE>

Address of all persons above: c/o the Company.

----------
(1)   For purposes of this table, a person or group of persons is deemed to have
      "beneficial ownership" of any shares of common stock which such person has
      the right to acquire  within 60 days of March 31,  2003.  For  purposes of
      computing  the  percentage of  outstanding  shares of common stock held by
      each  person or group of persons  named  above,  any  security  which such
      person or  persons  has or have the right to acquire  within  such date is
      deemed  to be  outstanding  but is not  deemed to be  outstanding  for the
      purpose of computing the percentage ownership of any other person.  Except
      as  indicated  in the  footnote to this table and  pursuant to  applicable
      community  property  laws,  the  Company  believes  based  on  information
      supplied by such  persons,  that the persons named in this table have sole
      voting and  investment  power with  respect to all shares of common  stock
      which they beneficially own.

(2)   Consists of shares  issuable upon exercise of warrants:  133,333 issued in
      2001 and 50,000 issued in 2002.  These warrants have a cash-less  exercise
      provision and include  certain  piggyback  registration  rights.  Does not
      include any securities owned by Jane Swon, Mr. Swon's spouse,  as to which
      securities Mr. Swon disclaims beneficial ownership.

(3)   Consists of shares  issuable upon exercise of warrants:  133,333 issued in
      2001 and 50,000 issued in 2002.  These warrants have a cash-less  exercise
      provision and include  certain  piggyback  registration  rights.  Does not
      include any securities owned by P. Elayne Wishart, Mr. Deichl's spouse, as
      to which securities Mr. Deichl disclaims beneficial ownership.

(4)   Consists of shares issuable upon exercise of warrants issued in 2002.

(5)   Mr.  Germano holds options to purchase  1,408,835  shares of the Company's
      common stock, of which 845,301 are vested, which shares are included. Also
      included are shares  issuable upon exercise of warrants to purchase 41,667
      and 50,000 shares of Company common stock.

(6)   Consists of shares  issuable upon exercise of warrants:  133,333 issued in
      2001 and 50,000 issued in 2002.  These warrants have a cash-less  exercise
      provision and include certain piggyback registration rights.

(7)   Includes shares issuable upon exercise of warrants: 133,333 issued in 2001
      and  50,000  issued in 2002.  These  warrants  have a  cash-less  exercise
      provision and include certain piggyback registration rights.

(8)   Includes  warrants to purchase  1,068,692 shares of the Company.  Jerry E.
      Swon, Ms. Swon's husband,  disclaims  beneficial  ownership of all Company
      securities owned by Ms. Swon.

(9)   Includes  warrants  to purchase  1,068,692  shares of the  Company.  Bruce
      Deichl,  Ms.  Wishart's  husband,  disclaims  beneficial  ownership of all
      Company securities owned by Ms. Wishart.

(10)  Includes  warrants  to purchase  200,380  shares of the  Company's  common
      stock.

----------
**    Less than 1%


                                                                              24
<PAGE>

ITEM 12: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      On January 11, 2001  Millennium  entered into an Investment and Assignment
Agreement with David Miller, a founding shareholder of the Company.  Pursuant to
the agreement,  Mr. Miller  assigned to Millennium  all of his right,  title and
interest  to all  formulations,  material  and  technologies  made,  invented or
developed by him which relate in any way to  nutraceutical  supplements and also
granted  Millennium  the  exclusive  right  to  patent  and  trademark  any such
inventions.  In  consideration  of the assignment,  Millennium  issued 2,671,729
shares of its common stock to Mr. Miller and granted to him a perpetual  royalty
equal to .0333 of the gross sales of RESURGEX(TM) and  PROSURGEX(TM) and .033 of
the gross  profit from the sale of any  additional  products of  Millennium.  No
royalties have been paid so far, however, the royalties have been accrued in the
books of the Company.

      On January  11,  2001  Millennium  entered  into  Royalty  and  Investment
Agreements  with Jane Swon  (spouse  of Jerry E.  Swon)  and P.  Elayne  Wishart
(spouse of Bruce Deichl). Pursuant to such agreements,  Ms. Swon and Ms. Wishart
were each issued 4,007,594 shares of Millennium  common stock for  consideration
of $25,000  each.  In addition,  Ms. Swon and Ms.  Wishart each paid  Millennium
$25,000 for a perpetual royalty pursuant to which they are each entitled to .033
of the  gross  sales of  RESURGEX(TM)  and  PROSURGEX(TM)  and .033 of the gross
profit from the sale of any additional products.  No royalties have been paid so
far, however, the royalties have been accrued in the books of the Company.

      Millennium retained the services of David Miller, a principal stockholder,
pursuant to a consulting agreement, dated May 1, 2001 to advise and assist it on
sales, marketing and the development of its customer base and products. The term
of the agreement is for three years commencing on May 1, 2001 unless  terminated
as  provided  for  in  the  agreement.  Mr.  Miller  is  to  receive  an  annual
compensation  of $48,000  and  received  options to purchase  200,380  shares of
common stock.

      On October 30,  2002,  the board of  directors  of the Company  approved a
resolution  pursuant to which the exercise price of warrants for the purchase of
a total  533,332  shares of the common  stock of the  Company,  held by the four
directors, was reduced from $3.00 to $0.50.

      During the year, a corporate  entity named the Tax Transfer  Corp.  of New
Jerseycontrolled  by P. Elayne Wishart (spouse of Bruce Deichl) extended certain
loans to the Company,  evidenced by promissory  notes with a term of six months,
carrying  interest at the rate of 10% per year. Such loans  aggregated  $142,500
and were  accompanied  by the issuance of 167,848  restricted  common shares for
origination fees. At December 31, 2002, $142,500 of such loans were outstanding.

The Company  participates  in the Tax  Transfer  Program of New Jersey a program
that allows  technology  and  biotechnology  companies  sell their net operating
losses  related to New Jersey  state taxes to  profitable  companies  within the
state  at  a  discount.  The  transaction  provides  cash  to  the  unprofitable
technology and  biotechnology  companies and a discount on state tax payments to
the profitable companies. The Company is engaged in a contract with Tax Transfer
Corp of New Jersey where Tax Transfer Corp. is a broker for this transaction.

ITEM 13: EXHIBITS AND REPORTS ON FORM 8-K

(a)   Exhibits

      The Exhibits that are filed with this report or that are  incorporated  by
reference are set forth in the Exhibit Index attached hereto.

(b)   Reports on Form 8-K

      There were no reports filed on Form 8-K during the fourth quarter in 2002.


                                                                              25
<PAGE>

ITEM 14: CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures:

Based on their evaluation as of a date within 90 days of the filing date of this
report,  our principal  executive  officer and principal  financial officer have
concluded  that  Millennium  Biotechnologies  Group,  Inc.'s  ("the  Company's")
disclosure  controls and procedures (as defined in Rules 13a-14(c) and 15d-14(c)
under the Securities  Exchange Act of 1934, as amended (the "Exchange Act")) are
sufficiently  effective to ensure that the information  required to be disclosed
by the Company in the reports  that we file under the  Exchange Act is gathered,
analyzed and disclosed with adequate timeliness, accuracy and completeness.

Changes in internal controls:

There have been no  significant  changes in our  internal  controls  or in other
factors that could significantly affect these controls subsequent to the date of
the evaluation referred to above, nor were there any significant deficiencies or
material  weaknesses  in  the  Company's  internal  controls.   Accordingly,  no
corrective actions were required or undertaken.

Limitations on the effectiveness of controls:

A control  system,  no matter how well conceived and operated,  can provide only
reasonable,  not absolute,  assurance  that the objectives of the control system
are met. Because of inherent  limitations in all control systems,  no evaluation
of controls can provide  absolute  assurance  that all control  issues,  if any,
within a company have been detected.


                                                                              26
<PAGE>

                                   SIGNATURES

In  accordance  with  Section 13 or 15(d) of the  Securities  Exchange  Act, the
Registrant has caused this Report to be signed on its behalf by the undersigned,
thereunto duly authorized.

         MILLENNIUM BIOTECHNOLOGIES GROUP, INC.

         By: /s/ Jerry E. Swon                               Date: May 13, 2003
             -------------------------------------
             Jerry E. Swon
             President and Chief Executive Officer
             (Principal Executive Officer),
             Chairman of the Board

         By: /s/ Frank Guarino                               Date: May 13, 2003
             -----------------------------
             Frank Guarino
             Chief Financial Officer
             (Principal Financial Officer)

In accordance with the requirements of the Securities  Exchange Act, this Report
has been signed below by the following  persons on behalf of the  Registrant and
in the capacities and on the dates indicated.

         Name                                                      Date
         ----                                                      ----

         /s/ Bruce Deichl                                          May 13, 2003
         -----------------
         Bruce Deichl, Director

         /s/ Michael G. Martin                                     May 13, 2003
         ----------------------
         Michael G. Martin, Director

         /s/ David Sargoy                                          May 13, 2003
         -----------------
         David Sargoy, Director


                                                                              27
<PAGE>

EXHIBIT 99.1-1

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Millennium  Biotechnologies  Group, Inc.
(the  "Company")  on Form 10-KSB for the year ended  December  31, 2002 as filed
with the Securities and Exchange  Commission on the date hereof (the  "Report"),
I, Jerry E. Swon, Chief Executive Officer of the Company,  certify,  pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that:

      (1)   the Report fully complies with the  requirements of Section 13(a) or
            15(d) of the Securities Exchange Act of 1934 and

      (2)   the  information  contained in the Report  fairly  presents,  in all
            material respects, the financial condition and results of operations
            of the Company.

Dated: May 13, 2003

                                               By: /s/ Jerry E. Swon
                                                   ---------------------------
                                                       Jerry E. Swon
                                                       Chief Executive Officer


<PAGE>

EXHIBIT 99.1-2

                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Millennium  Biotechnologies  Group, Inc.
(the  "Company")  on Form 10-KSB for the year ended  December  31, 2002 as filed
with the Securities and Exchange  Commission on the date hereof (the  "Report"),
I, Frank Guarino, Chief Financial Officer of the Company,  certify,  pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that:

      (1)   the Report fully complies with the  requirements of Section 13(a) or
            15(d) of the Securities Exchange Act of 1934 and

      (2)   the  information  contained in the Report  fairly  presents,  in all
            material respects, the financial condition and results of operations
            of the Company.

Dated: May 13, 2003

                                              By: /s/ Frank Guarino
                                                  ---------------------------
                                                      Frank Guarino
                                                      Chief Financial Officer


<PAGE>

EXHIBIT 99.1-3

                            CERTIFICATION PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Jerry E. Swon,  the Chief  Executive  Officer of  Millennium  Biotechnologies
Group, Inc., certify that:

1.  I  have   reviewed   this  annual   report  on  Form  10-KSB  of  Millennium
Biotechnologies Group, Inc. (the "Company");

2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
Company as of, and for, the periods presented in this annual report;

4. The Company's other certifying officer and I are responsible for establishing
and maintaining  disclosure  controls and procedures (as defined in Exchange Act
Rules 13a-14 and 15d-14) for the Company and we have:

      (a)  designed  such  disclosure  controls  and  procedures  to ensure that
material  information  relating  to  the  Company,  including  its  consolidated
subsidiaries, is made known to us by others within those entities,  particularly
during the period in which this annual report is being prepared;

      (b) evaluated the effectiveness of the Company's  disclosure  controls and
procedures  as of a date  within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

      (c)   presented  in  this  annual   report  our   conclusions   about  the
effectiveness of the disclosure  controls and procedures based on our evaluation
as of the Evaluation Date;

5. The Company's other  certifying  officer and I have  disclosed,  based on our
most recent evaluation,  to the Company's auditors and to the audit committee of
Company's board of directors:

      (a) all  significant  deficiencies  in the design or operation of internal
controls which could adversely affect the Company's ability to record,  process,
summarize  and  report  financial  data and have  identified  for the  Company's
auditors any material weaknesses in internal controls; and

      (c) any fraud, whether or not material,  that involves management or other
employees who have a significant role in the Company's internal controls; and

6. The Company's  other  certifying  officer and I have indicated in this annual
report whether or not there were significant  changes in internal controls or in
other factors that could  significantly  affect internal controls  subsequent to
the date of our most recent  evaluation,  including any corrective  actions with
regard to significant deficiencies and material weaknesses.

Dated: May 13, 2003                             By: /s/ Jerry E. Swon
                                                    ---------------------------
                                                        Jerry E. Swon
                                                        Chief Executive Officer


<PAGE>

EXHIBIT 99.1-4

                            CERTIFICATION PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Frank  Guarino,  the Chief  Financial  Officer of Millennium  Biotechnologies
Group, Inc., certify that:

1.  I  have   reviewed   this  annual   report  on  Form  10-KSB  of  Millennium
Biotechnologies Group, Inc. (the "Company");

2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
Company as of, and for, the periods presented in this annual report;

4. The Company's other certifying officer and I are responsible for establishing
and maintaining  disclosure  controls and procedures (as defined in Exchange Act
Rules 13a-14 and 15d-14) for the Company and we have:

      (a)  designed  such  disclosure  controls  and  procedures  to ensure that
material  information  relating  to  the  Company,  including  its  consolidated
subsidiaries, is made known to us by others within those entities,  particularly
during the period in which this annual report is being prepared;

      (b) evaluated the effectiveness of the Company's  disclosure  controls and
procedures  as of a date  within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

      (c)   presented  in  this  annual   report  our   conclusions   about  the
effectiveness of the disclosure  controls and procedures based on our evaluation
as of the Evaluation Date;

5. The Company's other  certifying  officer and I have  disclosed,  based on our
most recent evaluation,  to the Company's auditors and to the audit committee of
Company's board of directors:

      (a) all  significant  deficiencies  in the design or operation of internal
controls which could adversely affect the Company's ability to record,  process,
summarize  and  report  financial  data and have  identified  for the  Company's
auditors any material weaknesses in internal controls; and

      (b) any fraud, whether or not material,  that involves management or other
employees who have a significant role in the Company's internal controls; and

6. The Company's  other  certifying  officer and I have indicated in this annual
report whether or not there were significant  changes in internal controls or in
other factors that could  significantly  affect internal controls  subsequent to
the date of our most recent  evaluation,  including any corrective  actions with
regard to significant deficiencies and material weaknesses.

Dated: May 13, 2003                            By: /s/ Frank Guarino
                                                   ---------------------------
                                                       Frank Guarino
                                                       Chief Financial Officer


<PAGE>

EXHIBIT INDEX

Exhibit Description
-------------------

3.1   Certificate of Incorporation and Bylaws of the Company.(1)

3.2   Certificate of Incorporation and Bylaws of Millennium.*

4.1   Certificate of Designations filed July 26, 2001*

10.1  Agreement and Plan of Reorganization  between the Company,  Millennium and
      the Stockholders of Millennium dated July 26, 2001.(2)

10.2  License Agreement with Isocell SA.(3)

10.3  Royalty and Investment  Agreement between Millennium and P. Elayne Wishart
      dated January 11, 2001.*

10.4  Royalty and Investment  Agreement  between  Millennium and Jane Swon dated
      January 11, 2001.*

10.5  Royalty and Investment Agreement between Millennium and David Miller dated
      January 11, 2001.*

10.6  Employment  Agreement between  Millennium and Jerry E. Swon dated April 1,
      2001.*

10.7  Employment  Agreement  between  Millennium and Bruce Deichl dated April 1,
      2001.*

21    Subsidiaries of the Company:
      (i)  Millennium  Biotechnologies,  Inc. is a corporation  formed under the
      laws of the State of  Delaware  and is the name  under  which it  conducts
      business.

99.1  Certifications  pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act
      of 2002, 18 U.S.C. Section 1350

99.2  Corporate Code of Ethics and Business Conduct

----------
*     Previously  filed as an Exhibit  to the  Company's  Annual  Report on Form
      10-KSB for the fiscal year ended July 31, 2001.

(1)   Previously filed as an Exhibit to the Company's Annual Report on Form 10-K
      for the fiscal  year  ended  July 31,  1981,  and  incorporated  herein by
      reference.

(2)   Previously  filed as an Exhibit to the Company's  report on Form 8-K filed
      on August 10, 2001, and incorporated herein by reference.

(3)   Portions of this Exhibit were omitted and have been filed  separately with
      the Secretary of the Securities  and Commission  pursuant to the Company's
      Application  requesting  Confidential  Treatment  under  Rule  406  of the
      Securities Act of 1933.


                                                                              28
<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary

                        Consolidated Financial Statements

                                December 31, 2002


                                                                              29
<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                 Index to the Consolidated Financial Statements
                                December 31, 2002

                                                                         Page

      Independent Auditors' Report ....................................    1

      Financial Statements

           Consolidated Balance Sheet .................................    2

           Consolidated Statements of Operations ......................    3

           Consolidated Statement of Stockholders Equity (Deficit) ....  4-5

           Consolidated Statements of Cash Flows ......................  6-7

           Notes to the Consolidated Financial Statements .............  8-21


<PAGE>

                                 [letterhead of
                      Rosenberg Rich Baker Berman & Company
                   380 Foothill Road, Bridgewater, New Jersey]

                          Independent Auditors' Report

To the Board of Directors and Stockholders of
Millennium Biotechnologies Group, Inc. and Subsidiary

We have  audited  the  accompanying  consolidated  balance  sheet of  Millennium
Biotechnologies  Group,  Inc.  and  Subsidiary  as of December  31, 2002 and the
related   consolidated   statements   of   operations,    stockholders'   equity
(impairment),  and cash flows for the years  ended  December  31,  2002 and 2001
These financial  statements are the responsibility of the Company's  management.
Our responsibility is to express an opinion on these financial  statements based
on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audits to obtain  reasonable  assurance  about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,  the  consolidated  financial  position  of  Millennium
Biotechnologies  Group,  Inc.  and  Subsidiary  as of December  31, 2002 and the
consolidated  results  of their  operations  and their  cash flows for the years
ended  December 31, 2002 and 2001,  in  conformity  with  accounting  principles
generally accepted in the United States of America.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company  will  continue as a going  concern.  As  discussed  in the notes to the
financial   statements,   the  Company's   significant  operating  losses  raise
substantial  doubt  about  its  ability  to  continue  as a going  concern.  The
financial  statements do not include any adjustments  that might result from the
outcome of this uncertainty.

Bridgewater, New Jersey
April 25, 2003

/s/ Rosenberg Rich Baker Berman & Company


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                           Consolidated Balance Sheet
                                December 31, 2002

<TABLE>
<CAPTION>
<S>                                                                                  <C>
           Assets
           Current Assets:
             Cash                                                                    $    43,670
             Accounts receivable, net of allowance for doubtful accounts of $16,193       18,887
             Inventories                                                                 168,696
             Prepaid expenses                                                            145,652
             Miscellaneous receivables                                                    15,178
             Due from related party                                                       63,495
                                                                                     -----------
                   Total Current Assets                                                  455,578

      Property and equipment, net of accumulated depreciation of $37,955                  92,375
      Patents, net of accumulated amortization of $816                                    21,156
      Deposits                                                                            53,196
                                                                                     -----------
               Total Assets                                                              622,305
                                                                                     ===========

      Liabilities and Stockholders' Equity (Impairment)
           Current Liabilities:
             Accounts payable and accrued expenses                                       815,797
             Short-term debt                                                             502,038
             Notes payable - related party                                               142,500
             Due to officers                                                             303,896
                                                                                     -----------
               Total Current Liabilities                                               1,764,231

           Long-term debt                                                                128,750
                                                                                     -----------
               Total Liabilities                                                       1,892,981

           Commitments

      Stockholders' Equity (Impairment)
           Preferred stock, par value $1; 810,360 shares authorized:
           Convertible Series B, 65,141 shares issued and outstanding;
             at redemption value                                                         130,282
           Cumulative Series C, non-voting 64,763 shares issued and outstanding           64,763
           Convertible Series D, voting 0 shares issued and outstanding                       --
           Common stock, par value $0.001; authorized 75,000,000 shares; issued
             and outstanding 17,902,485 shares                                            17,902
           Additional paid-in capital                                                  4,065,862
           Accumulated Deficit                                                        (5,549,485)
                                                                                     -----------
             Total Stockholders' Equity (Impairment)                                  (1,270,676)
                                                                                     -----------

               Total Liabilities and Stockholders' Equity (Impairment)               $   622,305
                                                                                     ===========
</TABLE>

See notes to consolidated financial statements.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                      Consolidated Statements of Operations

<TABLE>
<CAPTION>
                                                              Year Ended December 31,
                                                            ---------------------------
                                                                 2002          2001
                                                            ------------   ------------
<S>                                                         <C>            <C>
      Net Sales                                             $    675,080   $     79,342
      Cost of Sales                                              574,780         37,238
                                                            ------------   ------------
      Gross Profit                                               100,300         42,104
      Research and development costs                              15,871          4,821
      Selling, general and administrative expenses             3,151,857      1,723,872
                                                            ------------   ------------

      Loss from operations                                    (3,067,428)    (1,686,589)
                                                            ------------   ------------
      Other expense
           Interest expense                                     (269,529)        (8,924)
           Miscellaneous expense                                      --        (15,917)
                                                            ------------   ------------

      Total Other Expense                                       (269,529)       (24,841)
                                                            ------------   ------------
      Net loss before taxes                                   (3,336,957)    (1,711,430)
      Benefit from income taxes                                  131,538             --
                                                            ------------   ------------

      Net Loss                                                (3,205,419)    (1,711,430)
                                                            ============   ============

      Net Loss Per Common  Share                            $      (0.19)  $      (0.14)
                                                            ============   ============

      Weighted average number of common shares outstanding    16,772,410     12,463,515
                                                            ============   ============
</TABLE>

See notes to consolidated financial statements.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
           Consolidated Statement of Stockholders' Equity (Impairment)
                     Years Ended December 31, 2002 and 2001

<TABLE>
<CAPTION>
                                                                                    Preferred Stock
                                                  --------------------------------------------------------------------------------
                                                  Convertible     Convertible  Cumulative    Cumulative   Convertible  Convertible
                                                   Series B         Series B    Series C      Series C     Series D     Series D
                                                    Shares           Amount      Shares        Amount       Shares       Amount
                                                  -----------      ----------  ----------    ----------   -----------  -----------
<S>                                                <C>           <C>           <C>           <C>            <C>            <C>
Balance January 1, 2001                                --       $     --           --       $    --            --       $     --

Issuance of Millennium, Inc.
stock for patent formula                               --             --           --            --        50,000         50,000

Issuance of Millennium, Inc.
stock in connection with loan                          --             --           --            --         1,250          1,250

Issuance of Millennium, Inc.
stock in lieu of legal fees                            --             --           --            --         3,125          3,125

Issuance of Millennium, Inc.
stock - private placements                             --             --           --            --       182,675        182,675

Expenses related to reverse merger                     --             --           --            --            --             --
                                                   ------       --------       ------       -------       -------       --------
Subtotal - Millennium, Inc.                            --             --           --            --       237,050        237,050

Reorganization pursuant to
reverse merger                                     65,141        130,282       64,763        64,763         4,149          4,149

Issuance of Millennium
Biotechnologies Group, Inc. Stock
- private placements                                   --             --           --            --        22,043         22,043

Issuance of Millennium
Biotechnologies Group, Inc. Stock
- warrant exercise                                     --             --           --            --           750            750

Issuance of Millennium
Biotechnologies  Group, Inc. Stock
for services                                           --             --           --            --         2,495          2,495

Issuance of Millennium
Biotechnologies Group, Inc. stock
pursuant to note conversion                            --             --           --            --         1,664          1,664

Issuance of Millennium
Biotechnologies Group, Inc. stock
- finder's fee                                         --             --           --            --            --             --

Net (loss)                                             --             --           --            --            --             --
                                                   ------       --------       ------       -------       -------       --------
Balance, December 31, 2001                         65,141       $130,282       64,763       $64,763       268,151       $268,151
                                                   ======       ========       ======       =======       =======       ========
</TABLE>

<TABLE>
<CAPTION>
                                                            Common Stock
                                                    --------------------------
                                                       Shares          Amount       Additional         Deficit             Total
                                                                                    Paid in
                                                                                    Capital
                                                    ----------      ----------      -----------       -----------       -----------
<S>                                                 <C>             <C>             <C>               <C>               <C>
Balance January 1, 2001                                     --      $       --      $        --       $   (69,380)      $   (69,380)

Issuance of Millennium, Inc.
stock for patent formula                                    --              --          (50,000)               --                --

Issuance of Millennium, Inc.
stock in connection with loan                               --              --           (1,250)               --                --

Issuance of Millennium, Inc.
stock in lieu of legal fees                                 --              --           (3,125)               --                --

Issuance of Millennium, Inc.
stock - private placements                                  --              --          425,826                --           608,501

Expenses related to reverse merger                          --              --          (86,000)               --           (86,000)
                                                    ----------      ----------      -----------       -----------       -----------
Subtotal - Millennium, Inc.                                 --              --          285,451           (69,380)          453,121

Reorganization pursuant to
reverse merger                                       6,073,154         404,877         (285,451)         (563,256)         (244,636)

Issuance of Millennium
Biotechnologies Group, Inc. Stock
- private placements                                 8,600,001         573,337        1,179,620                --         1,775,000

Issuance of Millennium
Biotechnologies Group, Inc. Stock
- warrant exercise                                   1,224,993          81,666           23,999                --           106,415

Issuance
Biotechnologies  Group, Inc. Stock
for services                                                --              --           (2,495)               --                --

Issuance of Millennium
Biotechnologies Group, Inc. stock
pursuant to note conversion                                 --              --           78,336                --            80,000

Issuance of Millennium
Biotechnologies Group, Inc. stock
- finder's fee                                       3,780,000         252,000         (252,000)               --                --

Net (loss)                                                  --              --               --        (1,711,430)       (1,711,430)
                                                    ----------      ----------      -----------       -----------       -----------
Balance, December 31, 2001                          19,678,148      $1,311,880      $ 1,027,460       $(2,344,066       $   458,470
                                                    ==========      ==========      ===========       ===========       ===========
</TABLE>

See notes to consolidated financial statements


<PAGE>

           Consolidated Statement of Stockholders' Equity (Impairment)
 Years Ended December 31, 2002 and 2001 Millennium Biotechnologies Group, Inc.
                                 and Subsidiary

<TABLE>
<CAPTION>
                                                                                      Preferred Stock
                                                    -------------------------------------------------------------------------------

                                                     Convertible    Convertible  Cumulative  Cumulative  Convertible    Convertible
                                                       Series         Series B    Series C    Series C     Series D      Series D
                                                      B Shares         Amount      Shares      Amount       Shares        Amount
                                                     -----------    -----------  ----------  ----------  -----------    -----------
<S>                                                    <C>            <C>          <C>        <C>          <C>          <C>
Balance, January 1, 2002                               65,141         $130,282     64,763     $64,763      268,151      $ 268,151
Issuance of preferred stock - private
placements                                                 --               --         --          --          580            580
                                                       ------         --------     ------     -------     --------      ---------
Subtotal                                               65,141          130,282     64,763      64,763      268,731        268,731

Effect of 1:12 reverse split 4/1/02                        --               --         --          --           --             --

Conversion of Series D Preferred Shares                    --               --         --          --     (268,731)      (268,731)

Effect of change in par value of common
stock                                                      --               --         --          --           --             --

Issuance of stock warrants to outside
parties                                                    --               --         --          --           --             --

Issuance of common stock pursuant to note
conversion                                                 --               --         --          --           --             --

Beneficial conversion feature of
convertible notes                                          --               --         --          --           --             --

Amortization of equity investment versus
deferred royalties                                         --               --         --          --           --             --

Issuance of common stock for compensation                  --               --         --          --           --             --

Issuance of common stock for services                      --               --         --          --           --             --

Issuance of common stock pursuant to
exercise of warrants                                       --               --         --          --           --             --

Issuance of common stock - private
placements                                                 --               --         --          --           --             --

Issuance of common stock pursuant to
short-term debt conversion                                 --               --         --          --           --             --

Issuance of common stock pursuant to
issuance of related party notes payable                    --               --         --          --           --             --

Net (loss)                                                 --               --         --          --           --             --
                                                       ------         --------     ------     -------     --------      ---------
Balance, December 31, 2002                             65,141         $130,282     64,763     $64,763            0      $       0
                                                       ======         ========     ======     =======     ========      =========
</TABLE>

<TABLE>
<CAPTION>
                                                                Common Stock             Additional       Deficit          Total
                                                                                          Paid in
                                                                                          Capital
                                                        ---------------------------     -----------     -----------     -----------
                                                          Shares           Amount

                                                        -----------     -----------     -----------     -----------     -----------
<S>                                                      <C>            <C>             <C>             <C>             <C>
Balance, January 1, 2002                                 19,678,148     $ 1,311,880     $ 1,027,460     $(2,344,066)    $   458,470

Issuance of preferred stock - private
placements                                                       --              --          49,420              --          50,000
                                                        -----------     -----------     -----------     -----------     -----------
Subtotal                                                 19,678,148       1,311,880       1,076,880      (2,344,066)        508,470

Effect of 1:12 reverse split 4/1/02                     (18,038,302)     (1,202,554)      1,202,554              --              --

Conversion of Series D Preferred Shares                  14,350,884         956,725        (687,994)             --              --

Effect of change in par value of common
stock                                                            --      (1,050,059)      1,050,059              --              --

Issuance of stock warrants to outside
parties                                                          --              --          41,153              --          41,153

Issuance of common stock pursuant to note
conversion                                                  489,107             489         109,511              --         110,000

Beneficial conversion feature of
convertible notes                                                --              --         155,400              --         155,400

Amortization of equity investment versus
deferred royalties                                               --              --          10,000              --          10,000

Issuance of common stock for compensation                    25,000              25          16,662              --          16,687

Issuance of common stock for services                       395,569             395         249,451              --         249,846

Issuance of common stock pursuant to
exercise of warrants                                        139,028             139           1,139              --           1,278

Issuance of common stock - private
placements                                                  650,437             650         754,878              --         755,528

Issuance of common stock pursuant to
short-term debt conversion                                   44,764              45          22,337              --          22,382

Issuance of common stock pursuant to

issuance of related party notes payable                     167,850             167          63,832              --          63,999
Net (loss)                                                       --              --              --      (3,205,419)     (3,205,419)
                                                        -----------     -----------     -----------     -----------     -----------
Balance, December 31, 2002                               17,902,485     $    17,902     $ 4,065,862     $(5,549,485)    $(1,270,676)
                                                        ===========     ===========     ===========     ===========     ===========
</TABLE>

See notes to consolidated financial statements.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                        Consolidated Statements of Cash

<TABLE>
<CAPTION>
                                                                                        Year Ended December 31,
                                                                                  ---------------------------------
                                                                                     2002                   2001
                                                                                  -----------           -----------
<S>                                                                               <C>                   <C>
Cash flows from Operating Activities:
     Net loss                                                                     $(3,205,419)          $(1,711,430)
     Adjustments to reconcile net (loss) to net cash provided (used)
        by Operating Activities:
       Depreciation and amortization                                                   25,042                13,561
       Stock issued for services                                                      226,557                    --
       Stock issued for compensation                                                   16,687                    --
       Convertible feature of notes                                                   155,400                    --
       Provision for bad debts                                                         16,193                    --
       Stock issued for interest                                                       71,508
       Provision for inventory losses                                                 102,993                    --
     Changes in assets and liabilities
       (Increase) in inventory                                                       (143,712)             (125,172)
       (Increase) decrease in accounts receivable                                       5,979               (42,853)
       (Increase) in prepaid expenses                                                 (35,544)              (45,890)
       (Increase) in deposits                                                              --               (18,351)
       (Increase) decrease in miscellaneous receivables                                 9,965                (2,974)
       Increase in accounts payable and accrued expenses                              562,102               128,819
                                                                                  -----------           -----------
           Net Cash (Used) by Operating Activities                                 (2,192,249)           (1,804,290)
                                                                                  -----------           -----------

     Cash flows from Investing Activities:
       Increase in due from related party                                             (63,495)                   --
       Net payments pursuant to reverse merger                                             --                (4,535)
       Proceeds from notes payable - related party                                    142,500                    --
       Purchases of property and equipment                                            (54,737)              (68,743)
       Purchases of intangible assets                                                 (21,972)                   --
       Increase in due from officers                                                       --               (67,000)
                                                                                  -----------           -----------
           Net Cash Provided (Used) by Investing Activities                             2,296              (140,278)
                                                                                  -----------           -----------

     Cash flows from Financing Activities:
       Expenses related to reverse merger                                                  --               (86,000)
       Proceeds from borrowings                                                       635,430               142,740
       Repayment of loans and notes                                                        --              (180,000)
       Increase in due to officers                                                    295,834                    --
       Proceeds from issuance of common and preferred stock                           806,806             2,557,916
                                                                                  -----------           -----------
           Net Cash Provided (Used) by Financing Activities                         1,738,070             2,434,656
                                                                                  -----------           -----------

     Net Increase (decrease) in Cash                                                 (451,883)              490,088
     Cash - beginning of year                                                         495,553                 5,465
                                                                                  -----------           -----------
     Cash - end of year                                                           $    43,670           $   495,553
                                                                                  ===========           ===========

Supplemental information:
     Cash paid during the year for:
       Interest                                                                   $    40,335           $     3,140
                                                                                  ===========           ===========
       Income taxes                                                               $       580           $        --
                                                                                  ===========           ===========
</TABLE>

See notes to consolidated financial statements.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                                     Year Ended December 31,
                                                                                  ----------------------------
                                                                                    2002                2001
                                                                                  --------            --------
<S>                                                                               <C>                 <C>
Schedule of non-cash investing and financing activities:

    In connection with consideration for current services,
     395,569 common shares were issued                                            $250,242
                                                                                  ========

    In connection with consideration for compensation,
     25,000 shares were issued                                                    $ 16,687
                                                                                  ========

    In connection with the retirement of promissory note
     and accrued interest thereon, 489,107 common shares were issued              $110,000
                                                                                  ========

    In connection with the retirement of short-term debt,
     44,764 common shares were issued                                             $ 22,382
                                                                                  ========

    In connection with the existence of a series of loans from a related
     party, 167,850 shares of common stock were issued                            $ 63,999
                                                                                  ========

    In connection with the retirement of a promissory note, 1,664
     Convertible Preferred Series D shares were issued                                                $ 80,000
                                                                                                      ========
</TABLE>

See notes to consolidated financial statements.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements
                                December 31, 2002

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      Organization

            Millennium  Biotechnologies  Group, Inc. (the Company or "Millennium
      Group"),  formerly  Regent  Group,  Inc.,  is a  holding  company  for its
      subsidiary Millennium Biotechnologies, Inc. ("Millennium").

            Millennium was  incorporated in the State of Delaware on November 9,
      2000  and is  located  in  New  Jersey.  Millennium  is a  research  based
      bio-nutraceutical   corporation  involved  in  the  field  of  nutritional
      science.  Millennium's  principal  source of  revenue is from sales of its
      nutraceutical supplements, RESURGEX(TM) and PROSURGEX(TM) which serve as a
      nutritional support for immuno-compromised  individuals undergoing medical
      treatment for chronic debilitating diseases.

            The Company acquired  Millennium on July 27, 2001, when it completed
      a merger with Millennium.  In the merger, new Convertible Preferred Series
      D  stock  was  issued  in  exchange  for  all  the  outstanding  stock  of
      Millennium.  Such preferred shares were convertible into approximately 96%
      of the  outstanding  common  stock of the Company at the time of issuance.
      Under  the  terms  of the  Agreement  and  Plan of  Reorganization,  a new
      wholly-owned  Millennium  Group  subsidiary  merged into  Millennium.  For
      accounting  purposes,  the merger has been  treated as an  acquisition  of
      Millennium Group by Millennium, and a re-capitalization of Millennium. The
      historical  financial  statements  prior to July 27,  2001,  are  those of
      Millennium.  Subsequent  to July 27, 2001,  the financial  statements  are
      those of the  Company  and its  wholly-owned  subsidiary  Millennium  on a
      consolidated basis.

      Principles of Consolidation

            The Company's operations presently consist almost exclusively of the
      operations of Millennium.  The consolidated  financial  statements include
      the accounts of the Company and its subsidiary from the  acquisition  date
      and/or  through  their  respective   disposition  dates.  All  significant
      intercompany transactions and balances have been eliminated.

      Use of Estimates

            The  preparation  of the financial  statements  in  conformity  with
      generally  accepted  accounting  principles  requires  management  to make
      estimates and assumptions  that effect the reported  amounts of assets and
      liabilities and disclosure of contingent  assets and liabilities as of 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.

      Property and Equipment

            Property  and  equipment   are  stated  at  cost  less   accumulated
      depreciation.  Depreciation,  which includes  amortization of assets under
      capital  leases,  is calculated  using the  straight-line  method over the
      estimated  useful  lives  of the  assets:  3-8  years  for  machinery  and
      equipment,  leasehold  improvements  are amortized over the shorter of the
      estimated  useful  lives  of  the  underlying  lease  term.   Repairs  and
      maintenance  expenditures  which do not extend the useful lives of related
      assets  are  expensed  as  incurred.  For  Federal  income  tax  purposes,
      depreciation is computed under  accelerated  methods over the assets class
      life.

      Patents

            Patents are capitalized and amortized over 240 months.  Amortization
      expense was $816 and $0 for 2002 and 2001, respectively.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued

      Evaluation of Long-Lived Assets

            Long-lived  assets are  assessed  for  recoverability  on an ongoing
      basis.  In  evaluating  the fair value and future  benefits of  long-lived
      assets,  their carrying  value would be reduced by the excess,  if any, of
      the  long-lived  asset  over  management's  estimate  of  the  anticipated
      undiscounted future net cash flows of the related long-lived asset.

      Advertising costs

            Advertising   costs  are  charged  to  operations   when   incurred.
      Advertising expense was $4,571 and $3,948 for the years ended December 31,
      2002 and 2001, respectively.

      Shipping and Handling Costs

            Shipping and handling costs are included in cost of sales.  Shipping
      and handling  costs were  $24,484 and $3,522 for the years ended  December
      31, 2002 and 2001, respectively.

      Revenue Recognition

            Revenue is recognized at the date of shipment to customers  provided
      that the resulting receivable is deemed probable of collection.

      Stock-Based Compensation

            The Company has adopted the disclosure-only  provisions of Statement
      of Financial  Accounting  Standards No. 123,  "Accounting  for Stock-Based
      Compensation".  The standards encourages,  but does not require, companies
      to recognize  compensation  expense for grants of stock,  stock option and
      other  equity   instruments  to  employees   based  on  fair  value.   For
      non-employees, the fair market value of the Company's stock on the date of
      stock issuance or option grant is used.

      Income Taxes

            The Company  provides  for income taxes based on enacted tax law and
      statutory  tax rates at which items of income and expenses are expected to
      be settled in the  Company's  income tax return.  Certain items of revenue
      and expense are  reported  for Federal  income tax  purposes in  different
      periods  than for  financial  reporting  purposes,  thereby  resulting  in
      deferred  income taxes.  Deferred taxes are also  recognized for operating
      losses that are  available  to offset  future  taxable  income.  Valuation
      allowances are established when necessary to reduce deferred tax assets to
      the amount expected to be realized. The Company has incurred net operating
      losses for financial-reporting  and tax-reporting  purposes.  Accordingly,
      for Federal and state  income tax  purposes,  the benefit for income taxes
      has been  offset  entirely by a  valuation  allowance  against the related
      federal and state deferred tax asset for the year ended December 31, 2002.

      Loss Per Common Share

            Basic and diluted loss per common share are computed by dividing net
      loss by the weighted  average number of common shares  outstanding  during
      the periods,  giving effect  retroactively to the conversion of 268,605.73
      shares  Series D  convertible  preferred  stock into common shares and the
      reverse  split on a one-for  twelve  basis,  on April 1,  2002.  Potential
      common  shares used in computing  diluted  earnings  per share  related to
      stock options, warrants,  convertible preferred stock and convertible debt
      which,  if exercised,  would have an anti- dilutive effect on earnings per
      share, have not been included.

      Fair Value of Financial Instruments

            For financial instruments including cash, prepaid expenses and other
      current assets, short-term debt, accounts payable and accrued expenses, it
      was assumed that the carrying  values  approximated  fair value because of
      their short-term maturities.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued

Limitations

            Fair Value estimates are made at a specific point and time, based on
      relevant market information and information about the financial statement.
      These  estimates are  subjective in nature and involve  uncertainties  and
      matters of significant  judgment and therefore  cannot be determined  with
      precision.   Changes  in  assumptions  could   significantly   affect  the
      estimates.

Reclassification

            Certain  reclassifications  have been made to prior year balances to
      conform to the current year's presentation.

GOING CONCERN

      As shown in the accompanying  financial  statements,  the Company incurred
      net losses of $3,205,419  and  $1,711,430  during the years ended December
      31, 2002 and 2001,  respectively.  In addition,  the Company had a working
      capital deficit of $1,308,653 and a stockholders' impairment of $1,270,676
      at December  31,  2002.  The ability of the Company to continue as a going
      concern is dependent on increasing sales and obtaining  additional capital
      and  financing.  The financial  statements do not include any  adjustments
      that might be  necessary  if the  Company is unable to continue as a going
      concern.  Management's  plans are to  continue  discussions  with  several
      potential investors to obtain additional capital in order to alleviate the
      situation.

CONCENTRATIONS OF BUSINESS AND CREDIT RISK

      The Company  maintains  cash  balances in several  financial  institutions
      which are  insured by the  Federal  Deposit  Insurance  Corporation  up to
      $100,000.  Balances in these accounts may, at times,  exceed the federally
      insured limits.

      The Company  provides credit in the normal course of business to customers
      located   throughout  the  U.  S.  The  Company  performs  ongoing  credit
      evaluations  of  its  customers  and  maintains  allowances  for  doubtful
      accounts  based  on  factors  surrounding  the  credit  risk  of  specific
      customers, historical trends, and other information.

ACQUISITIONS AND MERGERS

      On July 27,  2001,  pursuant to an Agreement  and Plan of  Reorganization,
      Millennium   paid  Regent   $146,000,   which  was  used  to  pay  certain
      indebtedness of Millennium.  In addition, in November and December,  2001,
      the Company paid off pre-merger  Millennium Group  liabilities of $91,640.
      Each share of common stock of  Millennium  was  converted  into  preferred
      Series D shares of Millennium Group at a rate of .025 preferred shares for
      each common share of Millennium.  Each of these preferred  Series D shares
      is convertible into 641.215 common shares of Millennium and is entitled to
      641.215  votes.  The preferred  Series D shares have been  converted  into
      common shares on April 1, 2002.

MISCELLANEOUS RECEIVABLES

      Miscellaneous receivables at December 31, 2002 consist of the following:

            Due from receivables factor                         $ 10,992
            Miscellaneous                                          4,186
                                                                --------
            Total                                               $ 15,178
                                                                ========


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

INVENTORIES

      Inventories   consist  of  work-in-process  and  finished  goods  for  the
      Company's RESURGEX(TM) and PROSURGEX(TM) product lines. Cost-of-goods sold
      are calculated  using the average costing method.  Inventories at December
      31, 2002, consists of the following

            Raw Materials                                       $   205,261
            Work in Process                                          25,204
            Finished Goods                                            8,128
            Packaging                                                33,096
                                                                -----------
                                                                    271,689

            Less: Reserve for losses                               (102,993)
                                                                -----------
              Total                                             $   168,696
                                                                ===========

PROPERTY, AND EQUIPMENT

      Property, and equipment at cost, less accumulated depreciation at December
      31, 2002, consists of the following:

    Equipment                                                     $  68,572
    Leasehold improvements                                           61,758
                                                                  ---------
         Subtotal                                                   130,330
    Less accumulated depreciation                                    37,955
                                                                  ---------
         Total                                                    $  92,375
                                                                  =========

      Depreciation expense charged to operations was $ 24,226 and $3,561 for the
      years ended December 31, 2002 and 2001, respectively.

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

      Accounts  payable and  accrued  expenses  consisted  of the  following  at
      December 31, 2002:

      Accounts payable                                            $ 407,690
      Accrued interest                                                2,799
      Accrued professional fees                                     191,600
      Payroll taxes payable                                         104,801
      Miscellaneous accruals                                        108,907
                                                                  ---------
                                                                  $ 815,797
                                                                  =========


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

DEBT

      Short-term debt at December 31, 2002, is as follows:

<TABLE>
<CAPTION>
<S>                                                                                                               <C>
            Non-interest bearing cash advance by an accredited investor and consultant                            $  26,250
            Non-interest bearing cash advance by an accredited investor                                              10,584
            Promissory note dated December 17, 2002, issued to an accredited  investor,
            maturing September 17, 2003, bearing interest at the rate of 10% per annum  The
            holder of the note is entitled to convert all or a portion of the principal and interest
            at any time after the maturity date into shares of common stock of the Company
            at a price equal to $.10/share of the principal if the principal and interest is not fully
            repaid on or before the maturity date.  The Company issued 125,000 5-year
            common stock purchase warrants in conjunction with the note which were
            exercised at $.01 per share.  The computed discount (computed under Black-Scholes)
            related to the detachable common stock purchase warrants has been fully amortized.                       50,000

            Two non-interest bearing convertible promissory notes dated July 15,
              2002, issued to two accredited investors,  maturing July 15, 2003,
              convertible at the option of the holders into common shares at the
              rate of $1.50/share.  These notes are collateralized by a security
              interest in proceeds  from the sale of 2002 net  operating  losses
              under the State of New Jersey Tax Transfer program.                                                   159,000

            Promissory note dated October 17, 2002 in the amount of $125,000, bearing interest
              at 12% per annum, maturing February 17, 2003 less discount.  The 12% interest per
              annum accrued to date on the principal amount outstanding is to be paid weekly
              with 25% of all cash receipts received by the Company.  The Company issued
              70,000 3-year common stock purchase warrants exercisable at a $.50 per share
              in conjunction with the note and has recorded a discount for the fair market value
              (computed under Black-Scholes) for the warrant.                                                       101,610

            Loan payable  pursuant to Master  Financing  Agreement dated October 28, 2002
              bearing interest at 5% per annum.  This amount was overdue at December 31, 2002.                       46,146

            Payroll credit line payable pursuant to Master Financing Agreement
              dated October 28, 2002.                                                                               108,448
                                                                                                                  ---------
                                                                                                                  $ 502,038
                                                                                                                  =========

LONG TERM DEBT

     Long-term debt at December 31, 2002 is as follows:

            Twelve non-interest bearing convertible notes dated between July 31, 2002
              and December 30, 2002 issued to accredited investors, maturing between
              July 31, 2004 and December 30, 2004, convertible at the option of the
              holders into common shares at the rate of $.25 /share.                                              $ 128,750
                                                                                                                  =========
</TABLE>


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

INCOME TAX

      The income tax provision (benefit) is comprised of the following:

                                                    Year Ended December 31,
                                                 -----------------------------
                                                    2002               2001
                                                 ----------          ---------

State current provision (benefit)                $ (131,538)         $      --
State deferred provision (benefit)                       --                 --
                                                 ----------                 --
                                                 $ (131,538)         $      --
                                                 ==========          =========

      In 1998, the State of New Jersey  enacted  legislation  allowing  emerging
      technology and/or biotechnology  companies to sell their unused New Jersey
      Net  Operating  Loss ("NOL")  Carryover and Research and  Development  Tax
      Credits ("R&D Credits") to corporate  taxpayers in New Jersey. The Company
      entered into an agreement  under which it retained a third party broker to
      identify a buyer for Millennium's 2000 and 2001 NOL Carryovers.  The total
      tax benefit of this transaction was $132,118 in 2002.

      The  Company's  total  deferred tax asset and  valuation  allowance are as
      follows:

                                                  Year Ended December 31,
                                                 ------------------------
                                                    2002           2001
                                                 -----------    ---------
      Total deferred tax asset, noncurrent       $ 1,981,000    $ 699,000
      Less valuation allowance                    (1,981,000)    (699,000)
                                                 -----------    ---------
      Net deferred tax asset, noncurrent         $        --    $      --
                                                 ===========    =========

      The difference between income tax benefits in the financial statements and
      the tax benefit computed at the combined state and U. S. Federal statutory
      rate of 40% are as follows:

                                                      Year Ended December 31,
                                                      -----------------------
                                                       2002          2001
                                                      ------        ------
      Tax benefit                                       40%           40%
      Valuation allowance                               40%           40%
                                                       ----         -----
      Effective tax rate                                --            --
                                                       ====         =====

      At December 31, 2002, the Company has available  approximately  $4,950,000
      of net operating  losses to  carryforward  and which may be used to reduce
      future federal  taxable  income and expire  between  December 31, 2020 and
      2022.

      At December 31, 2002, the Company has available  approximately  $3,200,000
      of net operating  losses to  carryforward  and which may be used to reduce
      future state taxable income which expire December 31, 2009.

      The Company and  Millennium  file separate tax returns and have  different
      tax years.  The Company  files on a fiscal year ended July 31;  Millennium
      has a calendar year end.

      At  July  31,  2001,   the  Company  had  a  net  operating  loss  ("NOL")
      carryforward of approximately $11,126,000 for tax purposes expiring in the
      years  2003  through  2021.  The Tax  Reform  Act of 1986  provided  for a
      limitation


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

INCOME TAX, Continued

      on the use of NOL carryforwards, following certain ownership changes. As a
      result of  transactions  in the Company's stock during the year ended July
      31, 1999 and July 31,  2001, a change in ownership of greater than 50%, as
      defined,  had occurred.  Under such circumstances,  the potential benefits
      from  utilization of tax  carryforwards  may be  substantially  limited or
      reduced on an annual basis. Accordingly, the Company has not reflected any
      benefit of such net operating loss  carryforward in the deferred tax asset
      and valuation allowance computation

EMPLOYMENT AGREEMENTS

      Pursuant  to  an  employment  agreement,  dated  April  1,  2001,  between
      Millennium  and the Company's  President and CEO,  Jerry Swon, Mr. Swon is
      entitled to a base salary of $150,000  per year during the first  calendar
      year of his term of employment;  $250,000 per year for the second calendar
      year of  employment;  and  $300,000 per year for the third  calendar  year
      through the end of the term. In the first year of the term,  payment of up
      to 40% of Mr.  Swon's  base salary  shall be  deferred  until such time as
      Millennium, in its reasonable judgment, has the financial resources to pay
      such deferred compensation.  In addition to a base salary Millennium shall
      pay a discretionary  bonus, payable annually during each year of the term,
      at the sole and exclusive discretion of Millennium. Mr. Swon also receives
      a monthly expense allowance.

      Pursuant  to  an  employment  agreement,  dated  April  1,  2001,  between
      Millennium and the Company's  Secretary and COO, Bruce Deichl,  Mr. Deichl
      is  entitled  to a base  salary of  $150,000  per year per year during the
      first calendar year of his term of  employment;  $250,000 per year for the
      second  calendar year of  employment;  and $300,000 per year for the third
      calendar  year through the end of the term.  In the first year of the term
      payment of up to 40% of Mr.  Deichl's base salary shall be deferred  until
      such time as  Millennium,  in its reasonable  judgment,  has the financial
      resources to pay such deferred compensation.  In addition to a base salary
      Millennium shall pay a discretionary  bonus,  payable annually during each
      year of the term, at the sole and exclusive discretion of Millennium.  Mr.
      Deichl also receives a monthly expense allowance.

      Pursuant to a five year  employment  agreement,  dated May 18, 2001,  with
      Millennium,  Carl  Germano  was  appointed  Senior Vice  President  of New
      Product  Development  &  Research.  He is  entitled  to a base  salary  of
      $200,000 per year. In addition to the base salary  Millennium will pay Mr.
      Germano  a bonus  equal to .008 of the  gross  proceeds  from the sales of
      RESURGEX(TM)  each calendar quarter and a bonus equal to .008 of the gross
      profits of other Millennium products. He also received options to purchase
      26,365.6 shares of D Preferred Stock at $20 per share with 20% vested upon
      the signing of the employment agreement and the balance vest 20% per year.
      Mr. Germano also receives a monthly automobile allowance.

      Pursuant to a three year  employment  agreement,  dated May 1, 2001,  with
      Millennium,   John  Swon  was   appointed   Vice   President  of  Business
      Development.  He is entitled to a base annual salary of $50,000 during the
      first year with 10% annual increases each year thereafter.  In addition to
      the base salary,  Millennium  will pay Mr. Swon a bonus equal to .01663 of
      the gross  proceeds  from the sales of  RESURGEX(TM)  and a bonus equal to
      .01663 of the gross profits of other Millennium products. He also received
      options to purchase 6,250 shares of D Preferred Stock at $20 per share.

      Pursuant to a three year  employment  agreement,  dated May 1, 2001,  with
      Millennium,  Jerry T.  Swon was  appointed  Assistant  Vice  President  of
      Marketing  and Sales.  He is entitled  to a base annual  salary of $50,000
      during the first year with 10% annual increases each year  thereafter.  In
      addition to the base salary, Millennium will pay Mr. Swon a bonus equal to
      .01663 of the gross  proceeds from the sales of  RESURGEX(TM)  and a bonus
      equal to .01663 of the gross profits of other Millennium products. He also
      received  options to purchase 6,250 shares of D Preferred Stock at $20 per
      share.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

CAPITAL STOCK

      a) Preferred Stock

                  Convertible   Series  B  preferred  shares  ("Series  B")  are
            non-dividend  bearing,  and  are  convertible  into  shares  of  the
            Company's  common  stock at any time at the option of the holder and
            are subject to adjustment in accordance  with certain  anti-dilution
            clauses.  Cumulative  Series C preferred shares ("Series C") are not
            convertible  but are entitled to  cumulative  cash  dividends at the
            rate of $.65 per share per annum,  payable  in each year  commencing
            the year after all the shares of Series B are  retired.  Convertible
            Series D preferred shares ("Series D") are non-dividend  bearing and
            are  convertible  into shares of the  Company's  common stock at the
            option of the Company and are subject to  adjustment  in  accordance
            with certain  anti-dilution  clauses.  Pursuant to the Agreement and
            Plan of  Reorganization  with Millennium,  237,049.7 Series D shares
            were  issued  in  exchange  for  all  outstanding  common  stock  of
            Millennium. An additional 4,148.8 shares were issued in July 2001 at
            prices  between  $24.00  and  $36.00  per  share to four  individual
            accredited investors.

      b) Voting Rights

                  The holders of Series B and Series C  preferred  stock have no
            voting rights.  Each share of -*common stock is entitled to one vote
            and each share of Series D  preferred  stock is  entitled to 641.215
            votes.

      c) Dividend Restrictions

                  No cash  dividends  may be declared  or paid on the  Company's
            common stock if, and as long as,  Series B preferred  stock is still
            outstanding or there are dividends in arrears on outstanding  shares
            of Series C preferred  stock. No dividends may be declared on Series
            C shares if, and as long as, any Series B shares are outstanding.

      d) Other information is summarized as follows:

<TABLE>
<CAPTION>
                                                                                Convertible      Cumulative       Convertible
                                                                                 Series B        Series C         Series D
                                                                                -----------      --------------   -----------
<S>                                                                                     <C>        <C>                <C>
           Number of common shares to be issued upon ....................               10         None               641.215
            conversion of each preferred share

           Redemption  price and  involuntary  liquidation  value per  preferred
             shares (if redeemed,  ranking would be Convertible  Series D then
             Convertible Series B then Cumulative Series C)                          $2.00         $10.00(1)            $1.00

           (1) Plus any dividend in arrears.
</TABLE>

                  Because the Series B preferred stock had mandatory  redemption
            requirements  at the  time  of its  issuance  (which  are no  longer
            applicable),  these shares are stated at redemption value.  Series B
            shares are stated at par value.

      e) Common Stock

            During July 2001,  519,769 shares of the Company's common stock were
            issued to  creditors  of Regent in exchange for $120,293 of accounts
            payable.

OPTIONS AND WARRANTS

      The Company has adopted the  disclosure  only  provisions  of Statement of
      Financial   Accounting  Standards  No.  123  "Accounting  for  Stock-Based
      Compensation"  (FAS  No.  123).  Accordingly,  no  compensation  cost  for
      employees has been recognized for the stock options and warrants awarded.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

OPTIONS AND WARRANTS, Continued

      In February 2000, Millennium adopted its 2001 Stock Option Plan ("The 2001
      Plan"). The 2001 Plan provides that certain options granted thereunder are
      intended to qualify as "Incentive  Stock Options" (ISO) within the meaning
      of Section 422A of the United States Internal  Revenue Code of 1986, while
      non-qualified  options  may  also be  granted  under  the  Plan.  The Plan
      provided for the grant of options for up to 500,000  shares.  The purchase
      price per common stock  deliverable upon exercise of each ISO shall not be
      less than 100% of the fair  market  value of the common  stock on the date
      such option is granted.  If an ISO is issued to an individual who owns, at
      the time of grant, more than 10% of the total enhanced voting power of all
      classes of  Millennium's  common stock,  the exercise price of such option
      shall be at least 110% of the fair market value of the common stock on the
      date of grant and the term of the option  shall not exceed five years from
      the date of grant.  The purchase price of shares subject to  non-qualified
      stock options shall be determined by a committee  established by the Board
      of Directors  with the  condition  that such prices shall not be less than
      85% of the fair  market  value of the  common  stock at the time of grant.
      Millennium had no options issued  pursuant to this Plan as of December 31,
      2002.

      The granting of the following Company stock options was not under a formal
      stock option plan.

      Information  regarding the Company's stock options and warrants for fiscal
      years ended December 31, 2002 and 2001 is as follows:

<TABLE>
<CAPTION>
                                                                     December 31, 2002                  December 31, 2001
                                                                 -------------------------         -----------------------------
                                                                                  Weighted                              Weighted
                                                                                   Average                               Average
                                                                                  Exercise                              Exercise
                                                                   Shares          Price              Shares             Price
                                                                   -------        --------           ---------          --------
<S>                                                                <C>            <C>                  <C>               <C>
      Options outstanding -                                        667,932        $   0.37                  --           $  --
         Beginning of year
      Options exercised                                                 --              --                  --              --
      Options granted                                                   --              --             667,932            0.37
      Options cancelled                                                 --              --                  --              --
                                                                   -------        --------             -------           -----
        Options outstanding -                                      667,932        $   0.37             667,932           $0.37
          End of year
                                                                   =======        ========             =======           =====

                         Option price at end of year                        $.37                                 $.37
</TABLE>


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

OPTIONS AND WARRANTS, Continued

<TABLE>
<CAPTION>
<S>                                                                   <C>              <C>          <C>           <C>
     Option price range for
       Exercised shares                                                 N/A            N/A            N/A           N/A
     Options available for

       Grant at end of year                                             N/A              N/A          N/A           N/A

     Warrants outstanding - beginning of year                         4,784,574        $  0.54             --     $     -
     Warrants exercised                                                 125,000           0.01        142,159        0.75
     Warrants granted                                                   742,149           0.56      4,926,733        0.54
     Warrants expired                                                        --             --              -          --
                                                                      ---------        -------      ---------     -------
       Warrants outstanding - end of year                             5,401,723        $  0.55      4,784,574     $  0.54
                                                                      =========        =======      =========     =======

     Warrants price range at end of year                                    $.37 - $3.00                  $.37 - $3.00

     Warrants price for
       Exercised shares                                                    0.01                          0.75
     Warrants available for
       Grant at end of year                                             N/A              N/A          N/A           N/A
</TABLE>

The  weighted  exercise  price and  weighted  fair value of options and warrants
granted by the Company for years ended 2002 and 2001, are as follows:

<TABLE>
<CAPTION>
                                                                         December 31, 2002             December 31, 2001
                                                                   ----------------------------  ----------------------------
                                                                     Weighted                      Weighted
                                                                     Average        Weighted       Average        Weighted
                                                                     Exercise       Average        Exercise        Average
                                                                      Price        Fair Value       Price         Fair Value
                                                                   ------------  -------------   -------------   ------------
<S>                                                                    <C>            <C>            <C>             <C>
      Weighted  average of options  and  warrants  granted             $   --         $   --         $   --          $   --

      Weighted  average of options  and  warrants  granted             $ 0.56         $ 1.01         $ 0.52          $ 3.47
</TABLE>

      (1)   Does not include  warrants issued to previous  holders of Millennium
            warrants whose  securities have been exchanged for securities of the
            Company in accordance with the terms of the Merger Agreement.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

OPTIONS AND WARRANTS, Continued

      The following table summarizes information about fixed-price stock options
      and warrants outstanding at December 31,

<TABLE>
<CAPTION>
                                Number              Average                                  Number
                            Outstanding at         Remaining            Weighted         Exercisable at          Weighted
    Range of Exercise        December 31,         Contractual           Average           December 31,           Average
          Prices                 2002                Life            Exercise Price           2002            Exercise Price
    -----------------      ----------------      ------------        --------------    ----------------    -----------------
<S>                               <C>              <C>                      <C>               <C>                    <C>
        $.37 - 50                 4,410,016        3.6 years                $  0.40           4,410,016              $  0.40
           $.75                   1,518,665        3.5 years                   0.75           1,518,665                 0.75
      $2.00 - $3.00                 140,974        4.1 years                   2.38             140,974                 2.38
                                  ---------                                                   ---------
                                  6,069,655                                                   6,069,655
                                  =========                                                   =========
</TABLE>

      If the Company had used the fair value based method of accounting  for its
      employee stock options, as prescribed by Statement of Financial Accounting
      Standards  No.  123,  compensation  cost in net loss for the  years  ended
      December  31,  2002  and  2001  would  have   increased  by  $258,706  and
      $1,706,450,   respectively,  resulting  in  net  loss  of  $3,390,588  and
      $3,417,880 net of tax, respectively,  and loss per share of $.20 and $.27,
      respectively.  The value of each option  grant is estimated on the date of
      grant using the  Black-Scholes  option  pricing  model with the  following
      weighted average  assumptions:  expected dividend,  0%; risk-free interest
      rate, 5%; expected volatility, 125%; and expected life (in years) of 5.0.

      Total compensation cost recognized in the income statement for stock-based
      employee  compensation  awards  was  $16,687  and  $0 in  2002  and  2001,
      respectively.

OPERATING LEASE COMMITMENTS

      The Company  leases  certain  office space and equipment  under  operating
      leases.

      The Company's administrative facilities are located in approximately 2,200
      square feet of leased  office space in  Bernardsville,  New Jersey,  as to
      which  Millennium  entered into a 5 year lease,  starting January 1, 2001.
      The lease calls for a monthly rent of $5,807 plus  allocated  expenses and
      is personally guaranteed by certain officers of the Company.

      On October 2001, the Company signed a 5-year lease  commencing in December
      2002,  for  approximately  4,500  square feet of office space at a monthly
      rental of $9,116 through  November,  2004 and $9,876  thereafter,  plus an
      allocated  portion of certain  operating  expenses.  The Company  began to
      occupy these facilities in April 2003. The lease is personally  guaranteed
      by the Company's Chief Executive Officer Jerry E. Swon.

      The following is a schedule of future minimum rental  payments  (exclusive
      of allocated  expenses)  required under operating leases that have initial
      or  non-cancelable  lease terms in excess of one year as of  December  31,
      2002:


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

OPERATING LEASE COMMITMENTS, Continued

               Year Ending December 31,

                         2003                               $      179,079
                         2004                                      179,839
                         2005                                      188,199
                         2006                                      118,512
                         2007                                      108,636
                                                            --------------

            Total minimum payments required                 $      774,265
                                                            ==============

Rent expense for the Company under operating leases for the years ended December
31, 2002 and 2001 was $69,977 and $64,026, respectively.

RELATED PARTY TRANSACTIONS

      On January 11, 2001  Millennium  entered into an Investment and Assignment
      Agreement  with David  Miller,  a  founding  shareholder  of the  Company.
      Pursuant to the  agreement,  Mr. Miller  assigned to Millennium all of his
      rights, title and interest to all formulations,  material and technologies
      made,   invented  or   developed  by  him  which  relate  in  any  way  to
      nutraceutical  supplements and also granted Millennium the exclusive right
      to patent and  trademark  any such  inventions.  In  consideration  of the
      assignment,  Millennium issued 2,671,729 shares of its common stock to Mr.
      Miller and granted to him a perpetual  royalty  equal to 3.3% of the gross
      sales of RESURGEX(TM) AND  PROSURGEX(TM) and 3.3% of the gross profit from
      the sale of any additional products of Millennium.  No royalties have been
      paid so far, however,  the royalties have been accrued in the books of the
      Company.

      On January  11,  2001  Millennium  entered  into  Royalty  and  Investment
      Agreements  with Jane Swon (spouse of Jerry E. Swon) and P. Elayne Wishart
      (spouse of Bruce Deichl).  Pursuant to such  agreements,  Ms. Swon and Ms.
      Wishart were each issued 4,007,594  shares of Millennium  common stock for
      consideration of $25,000 each. In addition,  Ms. Swon and Ms. Wishart each
      paid Millennium $25,000 for a perpetual royalty pursuant to which they are
      each entitled to 3.3% of the gross sales of RESURGEX(TM) and PROSURGEX(TM)
      and 3.3% of the gross profit from the sale of any additional products.  No
      royalties have been paid so far, however,  the royalties have been accrued
      in the books of the Company. The $50,000  consideration is being amortized
      over 10 years to additional paid-in-capital.

      Millennium retained the services of David Miller, a principal stockholder,
      pursuant to a consulting agreement, dated May 1, 2001 to advise and assist
      it on  sales,  marketing  and the  development  of its  customer  base and
      products.  The term of the agreement is for three years  commencing on May
      1, 2001 unless terminated as provided for in the agreement.  Mr. Miller is
      to  receive an annual  compensation  of $48,000  and  received  options to
      purchase 200,380 shares of common stock.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

      RELATED PARTY TRANSACTIONS, Continued

      On October 30,  2002,  the board of  directors  of the Company  approved a
      resolution  pursuant  to which  the  exercise  price of  warrants  for the
      purchase of a total  533,332  shares of the common  stock of the  Company,
      held by the four directors, was reduced from $3.00 to $0.50.

      Between June 28, 2002 and September  23, 2002 a corporate  entity owned by
      P. Elayne Wishart  (spouse of Bruce Deichl)  extended  loans  evidenced by
      promissory notes totaling $142,500 to the Company. The notes all mature in
      six months and carry an  interest  rate of 10% per annum.  In  conjunction
      with the notes,  51,182 common shares were to be issued to the noteholder.
      One such note for $70,000 dated June 28, 2002 matured on December 28, 2002
      and was extended for an additional  six months at the same interest  rate.
      In conjunction with the extension an additional 106,060 shares were issued
      along with 10,606 in lieu of accrued  interest  of $3,500 on the  original
      note. In addition there were certain operating expenses paid by Millennium
      and charged back to this entity totaling $63,495.

CONVERTIBLE NOTES

      At December 31, 2002 the Company had an  aggregate of $287,750  payable in
      non-interest  bearing  convertible notes.  $159,000 of these notes are due
      July 15, 2003, and the remaining $128,750 is due between July 31, 2004 and
      December 30, 2004. The terms of the Company's  convertible notes generally
      provide that the holder of the note is entitled, at its option at any time
      on or before  the  maturity  date,  to  convert  all or a  portion  of the
      principal  amount  into  shares of common  stock of the Company at a fixed
      price.  The  holding  period  for the  shares  would be one year  from the
      funding of the convertible note.

      The Company  follows EITF 98-5 in accounting  for  convertible  notes with
      "beneficial  conversion  features"  (i.e., the notes may be converted into
      common  stock at the  lower of a fixed  rate at the  commitment  date or a
      fixed discount to the market price of the  underlying  common stock at the
      conversion  date).  Because the Company's  convertible  notes  contained a
      beneficial  conversion  feature  on the  date  of  issuance,  the  Company
      measured and recognized the intrinsic  value of the beneficial  conversion
      feature of the convertible  notes when the convertible  notes were issued.
      During the years ended  December  31, 2002 and 2001,  interest  expense of
      $155,400 and $0,  respectively,  was recognized as the intrinsic  value of
      the  beneficial  conversion  feature  of the  convertible  notes that were
      issued during such periods.

MAJOR VENDORS

      For the  sourcing of raw  materials,  procurement  of  inherent  specialty
      ingredients, manufacture of bulk product; quality control and testing; and
      contact research assistance,  the Company has retained the services of one
      vendor.


<PAGE>

              Millennium Biotechnologies Group, Inc. and Subsidiary
                   Notes to Consolidated Financial Statements

COMMITMENTS

      On July 25, 2001,  Millennium  entered into an  exclusive  limited  patent
      sublicense and  distribution  agreement with Isocell SA, a French company,
      which owns the rights to certain  specialty  ingredients.  Pursuant to the
      License  Agreement,  Millennium  is granted  an  exclusive  sublicense  to
      promote and  distribute  this product for use as a dietary  supplement  or
      functional food in certain defined medical market channels of distribution
      in North  America  involving  direct  sales of  nutraceutical  products to
      physicians for resale to their patients or through physician  prescription
      for Medicaid/Medicare reimbursement for nutritional supplements.

      The License  Agreement  provides for the sale of the product to Millennium
      at  stated  unit  prices  subject  to  volume  discounts.  The term of the
      agreement is for five years,  provided that Isocell may cancel the license
      (or make it non-exclusive)  in the event that Millennium  purchases of the
      product do not meet  scheduled  minimum  quotas for any  calendar  quarter
      during the term. In such event,  Millennium  may avoid  termination of the
      license by paying 50% of the prescribed  purchase minimum.  As of December
      31, 2002,  the Company has no  outstanding  minimum  purchase  commitments
      under this Agreement.

      The  Company  has  an  agreement  with  a  finance  company  to  sell  its
      receivables  with  recourse.  In the event the receivable is not collected
      within ninety days, the Company must  repurchase  the receivable  from the
      finance company.  At December 31, 2002, the Company is contingently liable
      in the amount of $89,677 relating to such receivables sold with recourse.

LITIGATION

      As of December  31, 2002 the Company was the subject of a claim for unpaid
      consulting fees in the amount of  approximately  $23,000.  The Company and
      the consultant settled on April 9, 2003.


<PAGE>

EXHIBIT 99.2

                      CODE OF ETHICS AND BUSINESS CONDUCT
                     MILLENNIUM BIOTECHNOLOGIES GROUP, INC.

The Company has adopted this Code of Ethics and Business Conduct,  applicable to
the Company's Principal Executive Officer,  its Principal Operating Officer, and
its Principal Financial Officer.

o     We will comply with all applicable laws and  regulations,  Federal,  State
      and Local.

o     We  shall  provide  full,  fair,  accurate,   timely,  and  understandable
      disclosure in reports and  documents  that we file with, or submit to, the
      Securities and Exchange Commission and in other public communications.

o     We will conduct  ourselves and our business with honesty,  integrity,  and
      fairness.

o     We reject bribery in all its forms.


o     We are  developing and promoting  products based on scientific  principles
      and best current information.

o     We will provide  sufficient  information  to enable  clients and others to
      make their own informed decisions.

o     We do not advertise in a false or misleading manner.


o     We will respect all requests for confidentiality of information.

o     We are alert to situations that might cause a conflict of interest or have
      the appearance of a conflict.  We will provide full disclosure when a real
      or potential conflict of interest arises.

o     We shall  promptly  report any violation of this Code that we become aware
      of, to the Board of Directors of the Company.

January 2003