================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

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

                FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2008

                                       OR

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

           For the transition period from ____________ to ____________

                        Commission file number: 000-50292

                                 MM2 GROUP, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


NEW JERSEY                                                        20-2554835
--------------------------------------------------------------------------------
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)


5 REGENT STREET, SUITE 520
LIVINGSTON, NJ                                                       07039
--------------------------------------------------------------------------------
(Address of Principal Executive Offices)                          (Zip Code)

Registrant's Telephone Number, Including Area Code: (732) 290-0019

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

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated files, or a smaller reporting company. See
the definitions of "large accelerated filer", "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the exchange act.

Large Accelerated filer [ ]                        Accelerated filer [ ]
Non-accelerated filer [ ]                          Smaller reporting company [X]
(Do not check if a smaller reporting company)

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

Number of shares of outstanding Class A, Common Stock,
     No par value, outstanding as of February 13, 2009: 449,999,999
================================================================================
<PAGE>

                        MM2 GROUP, INC. AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2008


                                TABLE OF CONTENTS
                                -----------------

                                                                        Page No.
                                                                        --------

PART I.   FINANCIAL INFORMATION

Item 1.   Condensed Consolidated Financial Statements

          Balance Sheets - December 31, 2008 (Unaudited)
          and June 30, 2008 (Audited)                                      2-3

          Statements of Operations - For the six months and three
          months ended December 31, 2008 and 2007 (Unaudited)               4

          Statements of Accumulated Other Comprehensive Loss - For
          the six months ended December 31, 2008 and 2007
          (Unaudited)                                                       5

          Statements of Cash Flows - For the six months ended
          December 31, 2008 and 2007 (Unaudited)                           6-7

          Notes to Condensed Consolidated Financial Statements
          (Unaudited)                                                      8-22

Item 2.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations                             23-26

Item 4T.  Controls and Procedures                                           27

PART II.  OTHER INFORMATION

Item 5.   Other information                                                 28

Item 6.   Exhibits                                                          28

                                        1
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE><CAPTION>
                                                                                      (Unaudited)       (Audited)
                                                                                      December 31,       June 30,
                                                                                          2008             2008
                                                                                      ------------     ------------
<S>                                                                                   <C>              <C>
                                     ASSETS
                                     ------
CURRENT ASSETS
Cash and cash equivalents                                                             $    106,133     $    130,814
Securities available for sale                                                                  800            5,200
Accounts receivable, net of allowance for doubtful accounts of $0                          166,359          483,617
Inventory 135,554                                                                          107,901
Deferred financing costs                                                                      --             15,625
Prepaid expenses                                                                             8,376           26,700
                                                                                      ------------     ------------
    Total current assets                                                                   417,222          769,857
                                                                                      ------------     ------------

PROPERTY AND EQUIPMENT, net                                                                  5,718            6,834
                                                                                      ------------     ------------

OTHER ASSETS
Deposits and other assets                                                                    3,183            3,183
                                                                                      ------------     ------------

TOTAL ASSETS                                                                          $    426,123     $    779,874
                                                                                      ============     ============

                       LIABILITIES AND STOCKHOLDERS' DEFICIT
                       -------------------------------------

CURRENT LIABILITIES
Accounts payable and accrued expenses                                                 $  1,654,964     $  1,559,566
Due to related parties                                                                   1,319,616        1,031,002
Convertible debentures payable, net of discount of $0 and
  $156,250, respectively                                                                 1,719,058        1,582,508
Derivative liability                                                                     3,674,905        1,912,227
Warrant liability                                                                        1,009,437        1,009,437
                                                                                      ------------     ------------

  Total current liabilities                                                              9,377,980        7,094,740
                                                                                      ------------     ------------


TOTAL LIABILITIES                                                                        9,377,980        7,094,740
                                                                                      ------------     ------------

COMMITMENTS AND CONTINGENCIES

</TABLE>




         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                       2
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)

<TABLE><CAPTION>
                                                                                      (Unaudited)       (Audited)
                                                                                      December 31,       June 30,
                                                                                          2008             2008
                                                                                      ------------     ------------
<S>                                                                                   <C>              <C>

STOCKHOLDERS' DEFICIT
Preferred stock, $1.00 par value; authorized 1,000,000 shares;
   no shares issued and outstanding                                                           --                --
Common stock:
  Class A - no par value; authorized 490,000,000 shares;
     December 31, 2008: 449,999,999 shares issued and outstanding
     June 30, 2008: 377,105,051 shares issued and outstanding                            1,430,401         1,404,648
  Class B - no par value; authorized 10,000,000 shares; 10,000,000 shares issued;
     December 31, 2008: 9,977,254 shares outstanding
     June 30, 2008: 9,985,375 shares outstanding                                               998               999
Additional paid-in capital                                                                 750,000           750,000
Accumulated comprehensive loss                                                            (279,200)         (274,800)
Accumulated deficit                                                                    (10,854,056)       (8,195,713)
                                                                                      ------------      ------------
  Total stockholders' deficit                                                           (8,951,857)       (6,314,866)
                                                                                      ------------      ------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                                           $    426,123      $    779,874
                                                                                      ============      ============


</TABLE>












         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                       3
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

<TABLE><CAPTION>
                                                      For the six months ended           For the three months ended
                                                            December 31,                        December 31,
                                                       2008              2007              2008              2007
                                                   ------------      ------------      ------------      ------------
<S>                                                <C>               <C>               <C>               <C>
SALES, net                                         $    666,266      $  1,202,836      $    210,406      $    510,911

COST OF SALES                                           433,885           965,441           140,435           394,395
                                                   ------------      ------------      ------------      ------------

GROSS PROFIT                                            232,381           237,395            69,971           116,516
                                                   ------------      ------------      ------------      ------------

GENERAL AND ADMINISTRATION EXPENSES
  Selling and marketing expenses                           --              22,762              --              (1,733)
  General and administrative expenses                   656,112           749,116           331,916           375,960
  Depreciation expenses                                   1,116               868               558               535
  Amortization of financing costs                        15,625            15,625             7,812             7,812
                                                   ------------      ------------      ------------      ------------
  Total general and administration expenses             672,853           788,371           340,286           382,574
                                                   ------------      ------------      ------------      ------------

(LOSS) FROM OPERATIONS                                 (440,472)         (550,976)         (270,315)         (266,058)
                                                   ------------      ------------      ------------      ------------

OTHER (INCOME) EXPENSES
    Other income                                           (148)           (8,292)              (35)           (3,242)
    Interest expense                                     86,751           100,139            43,330            52,182
    Liquidated damages                                  206,287           225,148           103,144           111,119
   (Gain) loss on revaluation of derivatives          1,762,678          (500,807)        1,178,686         1,063,146
   Consulting income                                       --             (70,000)             --                --
   Beneficial interest expense                            6,053                78              --             (16,822)
   Amortization of discount on debt conversion          156,250           446,689            78,125           223,345
                                                   ------------      ------------      ------------      ------------
  Total other expenses                                2,217,871           192,955         1,403,250         1,429,728
                                                   ------------      ------------      ------------      ------------

(LOSS) BEFORE PROVISION FOR
  INCOME TAXES                                       (2,658,343)         (743,931)       (1,673,565)       (1,695,786)

PROVISION FOR INCOME TAXES                                 --                --                --                --
                                                   ------------      ------------      ------------      ------------

NET (LOSS) APPLICABLE TO
    COMMON SHARES                                  $ (2,658,343)     $   (743,931)     $ (1,673,565)     $ (1,695,786)
                                                   ============      ============      ============      ============

NET (LOSS) PER COMMON SHARE
  Basic and diluted                                $      (0.01)     $      (0.00)     $      (0.00)     $      (0.01)
                                                   ============      ============      ============      ============

WEIGHTED AVERAGE SHARES OUTSTANDING
  Basic and diluted                                 442,657,106       160,183,114       449,999,999       164,219,457
                                                   ============      ============      ============      ============
</TABLE>

         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                       4
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENT OF ACCUMULATED
                      OTHER COMPREHENSIVE LOSS (UNAUDITED)
                      FOR THE SIX MONTHS ENDED DECEMBER 31,


<TABLE><CAPTION>
                                                                                          2008             2008
                                                                                      ------------     ------------
<S>                                                                                   <C>              <C>

Balance at the beginning of period                                                    $   (274,800)    $       --

Unrealized loss on securities available for sale:
     Unrealized losses arising during the period                                            (4,400)        (256,000)
                                                                                      ------------     ------------
     Net change for the period                                                              (4,400)        (256,000)
                                                                                      ------------     ------------
Balance at the end of the period                                                      $   (279,200)    $   (256,000)
                                                                                      ============     ============

</TABLE>

















              The accompanying notes are an integral part of these
                  condensed consolidated financial statements.

                                       5
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                      FOR THE SIX MONTHS ENDED DECEMBER 31,

<TABLE><CAPTION>
                                                                                          2008             2008
                                                                                      ------------     ------------
<S>                                                                                   <C>              <C>
CASH FLOW FROM OPERATING ACTIVITIES
 Net (loss)                                                                           $ (2,658,343)    $   (743,931)
 Adjustments to reconcile net (loss) to net cash (used in)
   operating activities
      Depreciation                                                                           1,116              868
      Common stock issued for services and compensation                                       --             63,379
      Amortization of discount on debt conversion                                          156,250          446,689
      Amortization of deferred financing costs                                              15,625           15,625
      (Gain) loss on revaluation of derivatives                                          1,762,678         (500,807)
      Beneficial interest expense                                                            6,053               78
      Securities receivable for consulting income                                             --            (70,000)
 Changes in operating assets and liabilities:
      Accounts receivable                                                                  317,258          226,712
      Inventory                                                                            (27,653)         116,478
      Prepaid expenses and other assets                                                     18,324           29,706
      Accounts payable and accrued liabilities                                              95,397          152,380
      Due to related parties                                                               288,614           60,272
                                                                                      ------------     ------------
 Total cash (used in) operating activities                                                 (24,681)        (202,551)
                                                                                      ------------     ------------


CASH FLOW FROM INVESTING ACTIVITIES
 Purchase of property and equipment                                                           --             (4,107)
                                                                                      ------------     ------------


NET (DECREASE) IN CASH AND CASH EQUIVALENTS                                                (24,681)        (206,658)

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD                                            130,814          457,599
                                                                                      ------------     ------------

CASH AND CASH EQUIVALENTS - END OF PERIOD                                             $    106,133     $    250,941
                                                                                      ============     ============

SUPPLEMENTAL CASH FLOW INFORMATION Cash paid during the period for:
 Interest expense                                                                     $       --       $       --
                                                                                      ============     ============
 Income taxes                                                                         $       --       $       --
                                                                                      ============     ============
</TABLE>











         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                       6
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
     CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (CONTINUED)
               FOR THE SIX MONTHS ENDED DECEMBER 31, 2008 AND 2007

SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES:

For the six months ended December 31, 2008:
-------------------------------------------

The Company issued 36,801,932 shares of its Class A Common Stock to YA Global
Investments (f/k/a Cornell Capital Partners) ("YA Global"), valued at $25,753,
for conversion of $19,700 of Secured Convertible Debentures issued on April 7,
2005 and subsequently amended on July 20, 2006. A beneficial interest expense of
$6,053 was charged to operations.

The Company issued 16,093,016 shares of Class A Common to Mark Meller, President
and CEO, upon the conversion of 3,621 shares of Class B Common Stock.

The Company issued 20,000,000 shares of Class A Common to Jerome Mahoney,
Non-executive Chairman of the Board, upon the conversion of 4,500 shares of
Class B Common Stock.

For the six months ended December 31, 2007:
-------------------------------------------

The Company issued 4,738,148 shares of its Class A Common Stock valued at
$38,457, as compensation to Meritz & Muenz LLP for repayment of legal services
valued at $38,379, which was provided during the year ended June 30, 2006,
pursuant to the terms of the MM2 Plan. A beneficial interest expense of $78 was
charged to operations.

The Company issued 1,000,000 shares of its Class A Common Stock valued at
$25,000, as compensation to officers of Genotec Nutritionals for year-end
bonuses pursuant to the provisions of the Genotec Plan.

The Company issued 42,685,673 shares of its Class A Common Stock to YA Global
Investments (f/k/a Cornell Capital Partners) ("YA Global"), for conversion of
$87,950 of Secured Convertible Debentures issued on April 7, 2005 and
subsequently amended on July 20, 2006.


         The accompanying notes are an integral part of these condensed
                       consolidated financial statements.

                                        7
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

NOTE 1 - DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Description of business
-----------------------
MM2 Group, Inc. ("MM2", or the "Company"), was incorporated in New York on March
18, 1968 under the name John DeNegris Associates, Inc. In 1974, John DeNegris
Associates, Inc. changed its name to Wien Group, Inc. ("Wien (NY)"). Wien (NY)
conducted a public relations business and traded in the public market until
December 1991 when the corporation ceased operations. Wien (NY) remained
inactive until September 1998 when it reacquired its good standing status with
the State of New York. Wien (NY) did not conduct any business prior to July
2001, at which time it initiated its business of providing corporate financial
advisory services to small and emerging companies that require advisory services
to continue their growth within their respective industries. Wien (NY) primarily
focused on the manufacturing, retail, music & entertainment, and health care
industries. These services include: general corporate finance, merger and
acquisition advisory services, consulting on overall corporate strategy,
facilitating asset-based lending, and arranging equipment leasing contracts.

On September 23, 2005, Wien (NY) reincorporated in the state of New Jersey
pursuant to a Plan and Agreement of Merger. Pursuant to such Plan and Agreement
of Merger, Wien (NY) merged with and into its wholly owned subsidiary ("Wien
(NJ)") with Wien (NJ) being the surviving entity. Wien (NJ)'s charter provided
for the authorization of Class A Common Stock (the "Wien (NJ) Class A Common"),
Class B Common Stock ("Wien (NJ) Class B Common"), and Preferred Stock ("Wien
(NJ) Preferred"). Pursuant to the Plan and Agreement of Merger, each holder of
Wien (NY)'s Common Stock received one share of Wien (NJ) Class A Common in
exchange for each share of such holder's Common Stock.

On October 19, 2005, Wien (NJ) completed its previously disclosed acquisition
(the "Acquisition") of all of the outstanding shares of MM2 Group, Inc., a New
Jersey corporation ("OldMM2"). The Acquisition was effected pursuant to the
terms of the Acquisition Agreement dated July 8, 2005 (the "Acquisition
Agreement") between Wien (NY), Wien (NJ), Stephen Wien, OldMM2 and the
stockholders of OldMM2 as of the date of the Acquisition Agreement. Prior to the
closing of the Acquisition, certain terms and conditions of the Acquisition
Agreement were amended by the parties thereto. The primary changes were to (i)
allow fractional shares of Wien (NJ) to be issued in connection with the
Acquisition (ii) correctly state the authorized capital stock of Wien (NJ) and
Wien (NY) and (iii) specify the authorized stock of Wien (NJ) following the
reincorporation.

The Company had nominal operations immediately before and after the Acquisition.
OldMM2 was a corporation formed on December 8, 2004. Other than the Acquisition,
no significant business activity has been conducted by OldMM2 from the date of
its creation to the date of the consummation of the Acquisition. The primary
activity of OldMM2 involved seeking merger or acquisition candidates with whom
it could either merge or acquire.

The Company is publicly traded and is currently traded on the NASD Over The
Counter Bulletin Board ("OTCBB") under the symbol "MMGP".

                                        8
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

Basis of presentation
---------------------
The Acquisition was accounted for as a reverse merger under the purchase method
of accounting. Accordingly, MM2 Group, Inc. will be treated as the continuing
entity for accounting purposes. The accompanying financial statements include
the accounts of Old MM2, Wien (NY) and its wholly owned subsidiary Wien (NJ).
These condensed consolidated financial statements have been prepared in
accordance with accounting principles generally accepted in the United States
for financial information and with the instructions to Form 10-Q and Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments (consisting only of
normal recurring adjustments) considered necessary for a fair presentation have
been included. It is suggested that these condensed consolidated financial
statements be read in conjunction with the June 30, 2008 audited financial
statements and the accompanying notes thereto filed with the Securities and
Exchange Commission on Form 10-KSB.

On September 21, 2006, the Company completed the acquisition of Genotec
Nutritionals, Inc, a New York based manufacturer and distributor of nutritional
supplements and vitamins. Pursuant to the Asset Purchase Agreement, the Company
issued 10,000,000 shares of Class A common stock valued at $300,000 to George
Kontonotas, Joseph Freedman, Susan Blancato, Michael Logerfo, Maureen
McLaughlin, Paula Daddone, Maureen Bridges and Robert Blancato. In addition, the
Company executed three-year employment agreements with Mr. Kontonotas, Mr.
Freedman and Ms Blancato and purchased $75,000 of Genotec's Series A Convertible
Preferred Stock, which was used to fund the working capital.

The result of operations for the six months ending December 31, 2008 are not
necessarily indicative of the results to be expected for the full year. For
further information, refer to the financial statements and footnotes included in
Form 10-KSB for the year ended June 30, 2008. References to the "Company," "we,"
"us" and "our" refer to MM2 Group Inc.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation
---------------------------
The accompanying condensed consolidated financial statements include the
accounts of the Company and its wholly owned subsidiaries. All significant
inter-company transactions and accounts have been eliminated in consolidation.

Use of Estimates
----------------
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from those estimates.

                                        9
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

Cash and Cash Equivalents
-------------------------
The Company considers all highly liquid investments purchased with original
maturities of three months or less to be cash equivalents. The Company had cash
equivalents at December 31, 2008 and June 30, 2008 of $0 and 25,543,
respectively. The cash equivalents represent investments in Triple A credit
rated money market funds that have 7-day auction rates competitive with current
market conditions. Total cash and cash equivalents at December 31, 2008 and June
30, 2008 are $106,133 and $130,814, respectively.

Concentration of Credit Risk
----------------------------
Financial instruments that potentially subject the Company to credit risk
consist of cash equivalents and accounts receivable.

The Company places its cash in what it believes to be credit-worthy financial
institutions. However, cash balances may exceed FDIC insured levels at various
times during the year. The Company has uninsured cash balances at December 31,
2008 and June 30, 2008 of $0 and $31,843, respectively.

The Company provides credit terms to its corporate customers based on their
negotiated contracts, which range from "payment on delivery" to "90 days" terms.
Our two largest customers represent approximately 82% and 97% of our receivables
at December 31, 2008 and June 30, 2008, respectively. Both of these customers
have excellent payment histories and we do not expect to experience any losses
on these collections.

Marketable Securities
---------------------
The Company has evaluated its investment policies consistent with FAS No. 115,
Accounting for Certain Investments in Debt and Equity Securities, and determined
that all of its investment securities are to be classified as
available-for-sale. Available-for-sale securities are carried at fair value,
with the unrealized gains and losses reported in Stockholders' Equity under the
caption Accumulated Other Comprehensive Loss.

Fair Value of Financial Instruments
-----------------------------------
The Company estimates that the fair value of all financial instruments at
December 31, 2008 and June 30, 2008, as defined in FAS 107, does not differ
materially from the aggregate carrying values of its financial instruments
recorded in the accompanying consolidated balance sheets. The estimated fair
value amounts have been determined by the Company using available market
information and appropriate valuation methodologies. Considerable judgment is
required in interpreting market data to develop the estimates of fair value, and
accordingly, the estimates are not necessarily indicative of the amounts that
the Company could realize in a current market exchange.

Revenue Recognition
-------------------
The Company recognizes revenues when products are shipped from its warehouse or
when the Company is notified that product has been drop-shipped from the
suppliers or from our outsourced packagers.

Our largest customer at December 31, 2008 and 2007, represented approximately
60% and 80%, respectively, of our product sales for the six months ended
December 31, 2008 and 2007.

                                       10
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

Accounts Receivables
--------------------
Accounts receivables consist primarily of uncollected invoices for product
sales. Payment terms vary from customer to customer and range from "payment on
delivery" to "90 days" terms. In addition, collection on credit card sales is
generally settled in 5 days. The Company does not provide for customer returns,
but will accommodate customers in special circumstances. Management has
determined that, based on its experience, that no provision for product returns
is required at December 31, 2008 and June 30, 2008.

Inventory
---------
Inventory primarily consists of bulk supplies of capsules and sealed powders,
bottles, caps and shipping containers are stored in our on-site warehouse. In
addition, we have supplies of purchased product and finished goods bottled
on-site. Inventory is valued at the average cost of all purchases.

Inventory reserves are estimated for excess and slow-moving inventory. These
estimates are based on current assessments about future demands, market
conditions and related management initiatives. If market conditions and actual
demands are less favorable than those projected by management, inventory
write-downs may be required. Management has determined that no provision for
excess and slow-moving inventory is required at December 31, 2008 and June 30,
2008.

Financing Costs
---------------
Financing costs consist primarily of commitment fees and broker fees relating to
the issuance of the Company's convertible debentures. These costs are generally
capitalized and amortized over the term of the debenture. In some cases, these
fees are expensed immediately if they relate to expired or terminated
debentures.

As of December 31, 2008 and June 30, 2008, the costs and accumulated
amortization for the deferred financing costs is as follows:


                                                   (Unaudited)     (Audited)
                                                     Dec 31,        June 30,
                                                      2008            2008
                                                   ----------      ----------
           Deferred financing costs                $   62,500      $   62,500
           Less: Accumulated amortization             (62,500)        (46,875)
                                                   ----------      ----------
                Net deferred financing costs       $      --       $   15,625
                                                   ==========      ==========


Basic and Diluted Earnings Per Common Share
-------------------------------------------
SFAS No. 128, "Earnings Per Share" requires presentation of basic earnings per
share ("basic EPS") and diluted earnings per share ("diluted EPS").

                                       11
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

The computation of basic EPS is computed by dividing income (loss) available to
common stockholders by weighted average number of common shares during the
period. Diluted earnings per share gives effect to all dilutive potential common
shares outstanding during the period. The computation of diluted EPS does not
assume conversion, exercise, or contingent exercise of securities that would
have an anti-dilutive effect on earnings resulting from the Company's net loss
position.

The shares used in the computations are as follows:
<TABLE><CAPTION>
                                                                                Six months ended December 31,
                                                                              --------------------------------
                                                                                   2008               2007
                                                                              -------------      -------------
<S>                                                                           <C>                <C>
Basic net (loss) per share computation:
---------------------------------------
  Net (loss) attributable to common stockholders                              $  (2,658,343)     $    (743,931)
  Weighted-average common shares outstanding                                    442,657,106        160,183,114
  Basic net (loss) per share attributable to common stockholders              $       (0.01)     $       (0.00)

Diluted net (loss) per share computation:
-----------------------------------------
  Net (loss) attributable to common stockholders                              $  (2,658,343)     $    (743,931)
  Weighted-average common shares outstanding                                    442,657,106        160,183,114
  Incremental shares attributable to the assumed conversion of Class B
     common stock, convertible debentures and warrants                                  N/A                N/A
  Total adjusted weighted-average shares                                        442,657,106        160,183,114
  Diluted net (loss) per share attributable to common stockholders            $       (0.01)     $       (0.00)
</TABLE>

The Company has common stock equivalents of approximately 70 billion and 11
billion at December 31, 2008 and 2007. These amounts are in excess of the
authorized capital of the Company. See Note 14, Subsequent Events, for actions
taken by the Board of Directors subsequent to December 31, 2008.

Comprehensive Income (Loss)
---------------------------
FAS No. 130, "Reporting Comprehensive Income", establishes standards for the
reporting and display of comprehensive income (loss) and its components in the
financial statements. The items of other comprehensive income (loss) that are
typically required to be displayed are foreign currency items, minimum pension
liability adjustments, and unrealized gains and losses on certain investments in
debt and equity securities. As of December 31, 2008 and 2007, the Company has
several items that represent comprehensive losses, and thus, has included a
statement of other comprehensive loss.

Derivative Liabilities
----------------------
During April 2003, the Financial Accounting Standards Board issued SFAS 149,
"Amendment of Statement 133 on Derivative Instruments and Hedging Activities."
SFAS 149 amends and clarifies accounting for derivative instruments, including
certain derivative instruments embedded in other contracts, and for hedging
activities under SFAS 133, "Accounting for Derivative Instruments and Hedging
Activities." The statement requires that contracts with comparable
characteristics be accounted for similarly and clarifies when a derivative
contains a financing component that

                                       12
<PAGE>

                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

warrants special reporting in the statement of cash flows. SFAS 149 is effective
for contracts entered into or modified after June 30, 2003, except in certain
circumstances, and for hedging relationships designated after June 30, 2003. The
financial statements for the six months ended December 31, 2008 and 2007 include
the recognition of the derivative liability on the underlying securities
issuable upon conversion of the YA Global Convertible Debentures.

Recent Accounting Pronouncements
--------------------------------
In April 2008, the FASB issued FSP No. 142-3, Determination of the Useful Life
of Intangible Assets. FSP 142-3 amends the factors an entity should consider in
developing renewal or extension assumptions used in determining the useful life
of recognized intangible assets under SFAS 142, Goodwill and Other Intangible
Assets, and adds certain disclosures for an entity's accounting policy of the
treatment of the costs, period of extension, and total costs incurred. FSP 143-3
must be applied prospectively to intangible assets acquired after January 1,
2009. The Company is currently evaluating the impact that FSP 142-3 will have on
its financial position or results of operations.

NOTE 3 - FAIR VALUE MEASUREMENTS

On July 1, 2008, the Company adopted SFAS No. 157 "Fair Value Measurements"
("SFAS 157"). SFAS 157 defines fair value, provides a consistent framework for
measuring fair value under Generally Accepted Accounting Principles and expands
fair value financial statement disclosure requirements. SFAS 157's valuation
techniques are based on observable and unobservable inputs. Observable inputs
reflect readily obtainable data from independent sources, while unobservable
inputs reflect our market assumptions. SFAS 157 classifies these inputs into the
following hierarchy:

     Level 1 Inputs- Quoted prices for identical instruments in active markets.
     Level 2 Inputs- Quoted prices for similar instruments in active markets;
          quoted prices for identical or similar instruments in markets that
          are not active; and model-derived valuations whose inputs are
          observable or whose significant value drivers are observable.
     Level 3 Inputs- Instruments with primarily unobservable value drivers.

The following table represents the fair value hierarchy for those financial
assets and liabilities measured at fair value on a recurring basis as of
December 31, 2008.

                                       13
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007


Assets                          Level I      Level II    Level III      Total
                              -----------  -----------  -----------  -----------

Securites available for sale  $       800  $       --   $       --   $       800
                              -----------  -----------  -----------  -----------
Total Assets                  $       800  $       --   $       --   $       800
                              ===========  ===========  ===========  ===========

Convertible debentures        $       --   $ 1,719,058  $       --   $ 1,719,058
Derivative liabilities                --     3,674,905          --     3,674,905
Warramt liability                     --     1,009,437          --     1,009,437
                              -----------  -----------  -----------  -----------
Total Liabilities             $       --   $ 6,403,400  $       --   $ 6,403,400
                              ===========  ===========  ===========  ===========


NOTE 4 - INVENTORIES

As of December 31, 2008 and June 30, 2008, inventory is as follows:

                                                (Unaudited)      (Audited)
                                                   Dec 31,        June 30,
                                                    2008            2008
                                                 ----------      ----------
     Purchased goods for resale                  $   41,528      $   38,287
     Raw materials                                   65,617          53,356
     Finished goods for resale                       28,409          16,258
                                                 ----------      ----------
     Net inventory                               $  135,554      $  107,901
                                                 ==========      ==========

NOTE 5 - SECURITIES AVAILABLE FOR SALE

On February 13, 2007, the Company received 4,000,000 shares of Deep Field
Technologies Class A Common Stock as compensation pursuant to the Consulting
Agreement with Deep Field Technologies, valued at $1,120,000. The Company
provided general corporate finance advisory and other similar consulting
services for a period of six (6) months from the date of the agreement.
Subsequent to the issue date of these securities, circumstances had changed
which impaired the expected fair value of the shares and management reduced the
fair value to $280,000 at June 30, 2007. At December 31, 2008 and June 30, 2008,
the fair value of these securities is $800 and $5,200, respectively. The
President and CEO of the Company was also the President and CEO of Deep Field
Technologies prior to execution of the Consulting Agreement.

NOTE 6 - INCOME TAXES

 Deferred tax assets and liabilities reflect the net tax effect of temporary
differences between the carrying amount of assets and liabilities for financial
reporting purposes and amounts used for income tax purposes. Significant
components of the Company's deferred tax assets and liabilities are summarized
as follows:

                                       14
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007


                                              (Unaudited)     (Audited)
                                              December 31,     June 30,
                                                  2008           2008
                                              -----------    -----------

     Deferred tax asset                       $ 1,530,000    $ 1,220,000
     Less:  Valuation allowance                (1,530,000)    (1,220,000)
                                              -----------    -----------
     Net deferred tax assets                  $       --     $       --
                                              ===========    ===========


As of December 31, 2008 and June 30, 2008, the Company has net operating loss
carry forwards of approximately $4,500,000 and $3,600,000, respectively, that
can be utilized to offset future taxable income for Federal income tax purposes
through 2028. Utilization of these net loss carry forwards is subject to the
limitations of Internal Revenue Code Section 382. Because of the current
uncertainty of realizing the benefit of the tax carry forward, a valuation
allowance equal to the tax benefit for deferred taxes has been established. The
full realization of the tax benefit associated with the carry forward depends
predominantly upon the Company's ability to generate taxable income during the
carry forward period.

NOTE 7 - RELATED PARTY TRANSACTIONS

As of December 31, 2008 and June 30, 2008, the Company has accrued $1,319,616
and $1,031,002, respectively, of deferred compensation for the Non-executive
Chairman and the President of the Company. These deferrals will remain unpaid
until the Board of Directors determines that the Company has sufficient
liquidity to make such payments. The Non-executive Chairman and the President of
the Company have further agreed, however, to accept payment or partial payment,
from time to time, in the form of the Company's Class A Common Stock and/or the
Company's Class B Company Stock, at such time as the Board of Directors
determines to issue such shares in satisfaction of these accrued liabilities.

NOTE 8 - CONVERTIBLE DEBENTURES PAYABLE

On April 1, 2005, we entered into a Securities Purchase Agreement with YA Global
for the sale of $2,500,000 of secured convertible debentures. The agreement was
amended and restated on July 20, 2006 and January 4, 2007 to reflect the change
in the funding formulas. Pursuant to the terms of the agreement with YA Global,
on April 1, 2005 we issued a secured convertible debenture in the principal
amount of $1,250,000. On July 20, 2006, the secured convertible debenture was
amended and restated and reissued in an aggregate principal amount of
$1,330,308, which included accrued and unpaid interest on the original
convertible debenture of $80,308. Interest on the outstanding principal balance
of the Secured Convertible Debentures accrues at the annual rate of 10%. Payment
of principal and accrued interest shall be paid on or before July 1, 2008 on the
July 20, 2006 debenture. During the year ended June 30, 2007, we issued
3,086,420 shares of Class A common stock as repayment of principal of $50,000.
During the year ended June 30, 2008, we issued 158,639,780 shares of Class A
common stock as repayment of principal of $166,550. During the six months ended
December 31, 2008, we issued 36,801,932 shares of Class A common stock as
repayment of principal of $19,700. As of December 31, 2008 the remaining
principal balance of the convertible debenture was $1,094,058 plus

                                       15
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

$299,430 of accrued interest. As of June 30, 2008 the remaining principal
balance of the convertible debenture was $1,113,758 plus $244,186 of accrued
interest.

On January 4, 2007, we issued a secured convertible debenture in the principal
amount of $625,000. Interest on the outstanding principal balance of this
Secured Convertible Debentures accrues at the annual rate of 10%. Payment of
principal and accrued interest shall be paid on or before January 1, 2009. As of
December 31, 2008 the remaining principal balance of the convertible debenture
was $625,000 plus $124,486 of accrued interest. As of June 30, 2008 the
remaining principal balance of the convertible debenture was $625,000 plus
$92,979 of accrued interest.

The Company has the option to redeem a portion or all of the outstanding
debentures at 120% of the amount redeemed plus accrued interest. The holder
shall be entitled to convert in whole or in part at any time and from time to
time, any amount of principal and accrued interest at a price equal to 90% of
the lowest closing bid price of the Common Stock during the 30 trading days
immediately preceding the conversion date, as quoted by Bloomberg, LP
("Conversion Price").

In the event of a default, the full principal amount of this Debenture, together
with interest and other amounts owing, shall be due and payable in cash,
provided however, the holder of the debenture may request payment of such
amounts in Common Stock of the Obligor at the Conversion Price then in-effect. A
holder of the debenture may not convert this Debenture or receive shares of
Common Stock as payment of interest hereunder to the extent such conversion or
receipt of such interest payment would result in the holder of the debenture
beneficially owning in excess of 4.9% of the then issued and outstanding shares
of Common Stock, including shares issuable upon conversion of, and payment of
interest on, this Debenture.

Upon execution of the above agreements, the Company issued to YA Global
1,849,689 shares of Class A common stock, in accordance with the Termination
Agreement of July 20, 2006, and another certificate for 3,150,311 shares of
Class A common stock, for the aggregate total of 5,000,000 shares of Common
Stock (collectively, the "Commitment Shares").

The aggregate principal value of the Amended and Restated Secured Convertible
Debenture is $1,719,058 and $1,738,758 at December 31, 2008 and June 30, 2008,
respectively. These amounts are shown net of the unamortized portion of the
discount on conversion of $0 and $156,250, respectively. The discounts are being
amortized over the life of the debenture and is being recorded as a charge to
amortization of discount on debt conversion on the statement of operations.

Pursuant to the terms of the Amendment Number 1 to Amended and Restated Investor
Registration Rights Agreement with YA Global, the Company shall use its best
efforts (i) to have the Initial Registration Statement declared effective by the
SEC no later than ninety (90) days from the Scheduled Filing Deadline and (ii)
to insure that the Initial Registration Statement and any subsequent
Registration Statement remains in effect until all of the Registrable Securities
have been sold, subject to the terms and conditions of this Agreement. In the
event of default of

                                       16
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

the registration rights agreement, the Company will pay
liquidated damages, either in cash or shares of the Company's Common Stock, at
2% of the liquidated value of the Convertible Debentures outstanding for each
thirty (30) day period after the Scheduled Filing Deadline or the Scheduled
Effective Deadline as the case may be. Any Liquidated Damages payable hereunder
shall not limit, prohibit or preclude the Investor from seeking any other remedy
available to it under contract, at law or in equity. For the six months ended
December 31, 2008 and 2007, the Company has accrued $206,287 and $225,148,
respectively, of liquidated damages for failing to have the registration
statement declared effective by the SEC. As of December 31, 2008 and June 30,
2008 the Company has accumulated liquidated damages of $903,133 and $696,846,
respectively.

NOTE 9 - DERIVATIVE LIABILITY

In accordance with SFAS 133, "Accounting for Derivative Instruments and Hedging
Activities" and EITF 00-19, "Accounting for Derivative Financial Instruments
Indexed to, and Potentially Settled in, a Company's Own Stock", the conversion
feature associated with the YA Global Secured Convertible Debentures represents
embedded derivatives. As such, the Company had recognized embedded derivatives
in the aggregate amount of $2,642,352 as a liability in the accompanying
condensed consolidated balance sheets. As of December 31, 2008 and June 30,
2008, the derivative liability was measured at its estimated fair value of
$3,674,905 and $1,912,227, respectively.

The estimated fair value of the embedded derivative has been calculated based on
a Black-Scholes pricing model using the following assumptions:

                                                     Dec 31, 2008  June 30, 2008
                                                     ------------  -------------
    Fair market value of stock                         $0.00020      $0.00090
    Lowest closing bid price last 30 trading days      $0.00010      $0.00090
    Exercise price                                     $0.00009      $0.00081
    Dividend yield                                       0.00%         0.00%
    Risk free interest rate                              3.20%         5.60%
    Expected volatility                                 216.61%       291.08%
    Expected life                                       3 Years       3 Years

The derivative value of the January 4, 2007 debenture exceeded the face amount
of the debenture and as such, the excess value of $855,597 was charged to the
Loss on revaluation of derivatives on the consolidated statements of operations
in the year ended June 30, 2007.

Changes in the fair value of the embedded derivatives are calculated at each
reporting period and recorded in (gain) loss on revaluation of derivatives in
the consolidated statements of operations. During the six months ended December
31, 2008, there was a change in the fair value of the embedded derivatives,
which resulted in a total loss of $1,762,678. During the six months ended
December 31, 2007, there was a change in the fair value of the embedded
derivatives, which resulted in a total gain of $500,807.

                                       17
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

In accordance with SFAS 133, SFAS 150 and EITF 00-19, the initial fair market
value of the derivatives is recorded as a debt discount. The initial value of
the debt discount of $1,786,755 is being amortized over the life of the
convertible debentures. Amortization expense on the derivative for the six
months ending December 31, 2008 and 2007 was $156,250 and $446,689,
respectively.

NOTE 10 - STOCKHOLDERS' DEFICIT

In accordance with its Certificate of Incorporation as filed on July 7, 2005,
the Company is authorized to issue 1,000,000 shares of Preferred stock, $1.00
par value, 490,000,000 shares of Class A common stock, no par value; and
10,000,000 shares of Class B Common Stock, no par value. See Note 14 -
Subsequent Events for pending changes to the Certificate of Incorporation to be
made in subsequent periods.

PREFERRED STOCK

Preferred Stock consists of 1,000,000 shares of authorized preferred stock with
$1.00 par value. As of December 31, 2008 and June 30, 2008, no shares were
issued or outstanding.

CLASS A COMMON STOCK

Class A Common Stock consists of 490,000,000 shares of authorized common stock
with no par value. Each holder of Class A common stock is entitled to receive
ratably dividends, if any, as may be declared by the Board of Directors out of
funds legally available for the payment of dividends. The Company has never paid
any dividends on its common stock and does not contemplate doing so in the
foreseeable future. The Company anticipates that any earnings generated from
operations will be used to finance the growth objectives.

As of December 31, 2008 and June 30, 2008, 449,999,999 and 377,105,051 shares of
--------------------------------------------------------------------------------
Class A Common Stock were issued and outstanding.
-------------------------------------------------

For the six months ended December 31, 2008, the Company had the following
transactions in its Class A common stock:

The Company issued 36,801,932 shares of its Class A Common Stock to YA Global,
valued at $25,753, for conversion of $19,700 of Secured Convertible Debentures
issued on April 7, 2005 and subsequently amended on July 20, 2006. A beneficial
interest expense of $6,053 was charged to operations.

The Company issued 16,093,016 shares of Class A Common to Mark Meller, President
and CEO, upon the conversion of 3,621 shares of Class B Common Stock.

The Company issued 20,000,000 shares of Class A Common to Jerome Mahoney,
Non-executive

                                       18
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

Chairman of the Board, upon the conversion of 4,500 shares of Class B Common
Stock.

For the six months ended December 31, 2007, the Company had the following
-------------------------------------------------------------------------
transactions in its Class A common stock:
-----------------------------------------

The Company issued 4,737,148 shares of its Class A Common Stock valued at
$38,457, as compensation to Meritz & Muenz LLP for the repayment of legal
services valued at $38,379, which was provided during the year ended June 30,
2006, pursuant to the terms of the MM2 Plan. A beneficial interest expense of
$78 was charged to operations.

The Company issued 1,000,000 shares of its Class A Common Stock valued at
$25,000, as compensation to officers of Genotec Nutritionals for bonuses
pursuant to the provisions of the Genotec Plan.

The Company issued 42,685,673 shares of its Class A Common Stock to YA Global,
for conversion of $87,950 of Secured Convertible Debentures issued on April 7,
2005 and subsequently amended on July 20, 2006.

CLASS B COMMON STOCK

Class B Common Stock consisted of 10,000,000 shares of authorized common stock
with no par value. Class B stock has voting rights of 100 to 1 with respect to
Class A Common Stock. Class B common stockholders are entitled to receive
dividends in the same proportion as the Class B Common Stock conversion and
voting rights have to Class A Common Stock. A holder of Class B Common Stock has
the right to convert each share of Class B Common Stock into the number of
shares of Class A Common Stock determined by dividing the number of Class B
Common Stock being converted by a 50% discount of the lowest price that the
Company had ever issued its Class A Common Stock. Upon the liquidation,
dissolution, or winding-up of the Company, holders of Class B Common Stock will
be entitled to receive distributions.

As of December 31, 2008, 10,000,000 shares were issued and 9,977,254 shares were
outstanding. As of June 30, 2008, 10,000,000 shares were issued and 9,985,375
shares were outstanding.


For the six months ended December 31, 2008, the Company had the following
-------------------------------------------------------------------------
transactions in its Class B Common Stock:
-----------------------------------------

The Company issued 16,093,016 shares of Class A Common to Mark Meller, President
and CEO, upon the conversion of 3,621 shares of Class B Common Stock.

The Company issued 20,000,000 shares of Class A Common to Jerome Mahoney,
Non-executive Chairman of the Board, upon the conversion of 4,500 shares of
Class B Common Stock.

For the six months ended December 31, 2007, the Company had no transactions in
its Class B Common Stock:

                                       19
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

NOTE 11 - WARRANTS

On April 1, 2005, the Company sold to YA Global Capital a warrant to purchase
750,000 shares of its common stock for a purchase price of $10. This warrant had
an exercise price of $.07 per share, was vested immediately and expires two
years from the date of issue. On July 20, 2006, the Company issued an Amended
and Restated warrant which changed the exercise price to $.05 per share and
extended the redemption period to five years from the date of issuance. The fair
value of the amended warrant of $44,625 was estimated using the Black-Scholes
option-pricing model with the following weighted-average assumptions: dividend
yield of 0%; expected volatility of 142.21%; risk-free interest rates of 4.60%;
and expected life of 5 years. The gain on the disposition of the initial warrant
was credited to other income for $40,192 in the same period. The expense for the
amended warrant of $44,625 was charged to financing costs in the same period.

On March 16, 2006, the Company issued to YA Global a warrant to purchase
20,000,000 shares of its common stock pursuant to the Waiver and Extension
Agreement between the Company and YA Global. The exercise price is $.05 per
share (and may be subsequently adjusted if the Company issued or sold, or is
deemed to have issued or sold, any shares of the Company's Common Stock at a
lower price). The warrants were vested immediately and expire five years from
the date of issue. The fair value of $964,812 was estimated at date of grant
using the Black-Scholes option-pricing model with the following weighted-average
assumptions: dividend yield of 0%; expected volatility of 185%; risk-free
interest rates of 4.00%; and expected life of 5 years. The expense was charged
to financing costs in the same period.

NOTE 12 - COMMITMENTS AND CONTINGENCIES

The Company entered into two employment agreements with Jerome Mahoney, its
Non-executive Chairman of the Board and Mark Meller, its President and Board
Member, as of December 15, 2004. Each of the employment agreements is for a term
through December 31, 2011 and provides for annual compensation of $200,000 with
an annual increase of 10%. In addition, each executive shall be entitled to
Company sponsored fringe benefits and annual bonuses in accordance with the
Company policies and plans in effect for Executive officers of the Company. The
executives shall also be granted stock options under the Company's stock option
plan as adopted by the Board of Directors and the shareholders of the Company.
The executives will each receive a $750,000 bonus for the successful completion
of the registration of the Company's stock on Form S-1, SB-2 and any other such
form of registration statement declared effective by the Securities and Exchange
Commission. This bonus shall be paid in a lump sum on the date the registration
statement is declared effective, or alternately, at the discretion of the
Company and with the agreement of the Executive, in shares of the Company's
Class B Common Stock.

                                       20
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

On February 1, 2005, our wholly owned subsidiary, Genotec Nutritionals amended
its operating lease for office and warehouse space at 450 Commack Road, Deer
Park, NY. The term of the lease is four years commencing March 1, 2005. Monthly
base rental payments under the new lease range from $3,067 to $3,354 per month.
We are required to pay property taxes, utilities, insurance and other costs
relating to the leased facilities to include allocated common area maintenance
charges, snow removal charges and landlord insurance charges as deemed
necessary.

NOTE 13 - GOING CONCERN

The accompanying condensed consolidated financial statements have been prepared
in conformity with accounting principles generally accepted in the United States
of America, which contemplates continuation of the Company as a going concern.

The Company has suffered recurring losses and experiences deficiencies in cash
flow from operations. These matters raise substantial doubt about the Company's
ability to continue as a going concern. The recoverability of a major portion of
the recorded asset amounts shown in the accompanying condensed consolidated
balance sheet is dependent upon continued operations of the Company, which in
turn, is dependent upon the Company's ability to raise capital and/or generate
positive cash flows from operations.

The Company is seeking additional operating income opportunities through
potential acquisitions or investments. Such acquisitions or investments may
consume cash reserves or require additional cash or equity. Our working capital
and additional funding requirements will depend upon numerous factors,
including: (i) strategic acquisitions or investments; (ii) an increase to
current company personnel; (iii) the level of resources that we devote to sales
and marketing capabilities; (iv) technological advances; and (v) the activities
of competitors.

These condensed consolidated financial statements do not include any adjustments
relating to the recoverability and classification of recorded assets, or the
amounts and classification of liabilities that might be necessary in the event
the Company cannot continue in existence.

                                       21
<PAGE>
                        MM2 GROUP, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                           DECEMBER 31, 2008 AND 2007

NOTE 14 - SUBSEQUENT EVENTS

On January 13, 2009, the Company filed with the SEC an information statement,
titled "Notice of Shareholders Action by Written Consent to be Effective on or
about February 27, 2009", to notify the shareholders of the following actions
taken by the holders of a majority of the aggregate of our Class A Common Stock
and our voting Class B Common Stock (herein referred to as the "Voting Stock")
approving, by written consent dated November 25, 2008, the following:

      1.   An Amendment to the Certificate of Incorporation whereby the
           authorized number of Class A Common Stock is increased to Four
           Billion (4,000,000,000) shares;

      2.   The MM2 Group, Inc. 2007 Stock Incentive Plan (the "2007 Incentive
           Plan"); and

      3.   The Genotec Nutritionals, Inc. 2007 Stock Incentive Plan ("2007
           Genotec Plan").

      4.   A reverse split of our Common Stock whereby the total issued and
           outstanding number of Class A Common Sock shares shall equal 10
           million (10,000,000) shares and an Amendment to the Certificate of
           Incorporation to effect this reverse split.

      5.   Election of the Board of Directors.

As of the date of this filing, the Company is in default of the repayment terms
of the July 20, 2006 YA Global Convertible Debenture. Per the terms of the
debenture, "in the event of a default, the full principal amount of this
Debenture, together with interest and other amounts owing, shall be due and
payable in cash, provided however, the holder of the debenture may request
payment of such amounts in Common Stock of the Obligor at the Conversion Price
then in-effect." As of the date of this filing, YA Global has not demanded
payment and management is in negotiations to restructure the debt.

                                       22
<PAGE>

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

You should read the following discussion in conjunction with our financial
statements and related notes included elsewhere in this filing as well as our
audited statements and related notes for the fiscal year ended June 30, 2008
filed with Form 10-KSB. The following discussion contains forward-looking
statements. Please see "Forward Looking Statements - Cautionary Factors" for a
discussion of uncertainties, risks and assumptions associated with these
statements

RESULTS OF OPERATIONS

SIX MONTHS ENDED DECEMBER 31, 2008 COMPARED TO SIX MONTHS ENDED DECEMBER 31,
2007

Total sales for the six months ended December 31, 2008 and 2007 were $666,266
and $1,202,836, respectively. The $536,570 decrease is primarily the result of
the reductions in shipments of fish oil products as the customer experiences a
slow-down related to the worsening economy.

Cost of sales for the six months ended December 31, 2008 and 2007 were $433,885
and $965,441, respectively, for a reduction in costs of $531,556. The costs
represent the costs of bulk supplies of capsules and sealed powders, bottles,
caps, shipping containers, packaging and shipping of nutritional supplements by
Genotec. The decrease is primarily the result of the reductions in shipments of
fish oil products as discussed above.

Total operating expenses for the six months ended December 31, 2008 and 2007,
were $672,853 and $788,371, respectively. The decrease of $115,518 was primarily
due to reductions of consulting fees for advertising programs and management
services instituted in 2007 but not repeated in 2008. The Company also has
reduced or deferred insurance costs, travel expenses and payroll costs until
sales revenues increase. In addition, the Company incurred $25,000 in executive
bonuses for the Genotec management team in 2007 but not repeated in 2008.

The other (income) expense for the six months ended December 31, 2008 was an
expense of $2,217,871. This total was primarily comprised of a loss on
revaluation of derivatives of $1,762,678, liquidated damages of $206,287,
amortization of the discount on debt conversion of $156,250, interest expense of
$86,751 and beneficial interest on stock issuance of $6,053. Total other
(income) expense for the six months ended December 31, 2007 was a loss of
$192,955. This total was primarily comprised of amortization of the discount on
debt conversion of $446,689, liquidated damages of $225,148 and interest expense
of $100,139. These amounts are offset by gains on revaluation of derivatives of
$500,807, consulting income of $70,000 on the Deep Field Consulting Agreement
and interest income of $8,292. Interest expense is related to accrued interest
on the YA Global Convertible Debentures and interest income is related to
interest on the cash accounts.

Net (loss) for the six months ending December 31, 2008 and 2007, was a loss of
$2,658,343 and $743,931, respectively. The increase in net loss of $1,914,412,
as compared to the prior year income, is primarily due to unfavorable change in
the revaluation of derivatives of $2,263,485.

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<PAGE>

THREE MONTHS ENDED DECEMBER 31, 2008 COMPARED TO THREE MONTHS ENDED DECEMBER 31,
2007

Total sales for the three months ended December 31, 2008 and 2007 were $210,406
and $510,911, respectively. The $300,505 decrease is primarily the result of the
reductions in shipments of fish oil products as the customer experiences a
slow-down related to the worsening economy.

Cost of sales for the three months ended December 31, 2008 and 2007 were
$140,435 and $394,395, respectively, for a reduction in costs of $253,960. The
costs represent the costs of bulk supplies of capsules and sealed powders,
bottles, caps, shipping containers, packaging and shipping of nutritional
supplements by Genotec. The decrease is primarily the result of the reductions
in shipments of fish oil products as discussed above.

Total operating expenses for the three months ended December 31, 2008 and 2007,
were $340,286 and $382,574, respectively. The decrease of $42,288 was primarily
due to reductions of consulting fees, insurance costs, travel expenses and
payroll costs as the Company tightens up spending until sales revenues increase.

The other (income) expense for the three months ended December 31, 2008 was an
expense of $1,403,250. This total was primarily comprised of a loss on
revaluation of derivatives of $1,178,686, liquidated damages of $103,144,
amortization of the discount on debt conversion of $78,125 and interest expense
of $43,330. Total other (income) expense for the three months ended December 31,
2007 was an expense of $1,429,728. This total was primarily comprised of loss on
revaluation of derivatives of $1,063,146, amortization of the discount on debt
conversion of $223,345, liquidated damages of $111,119 and interest expense of
$52,182. These amounts are offset by recapture of beneficial interest on stock
issuance of $16,822 and interest income of $3,242. Interest expense is related
to accrued interest on the YA Global Convertible Debentures and interest income
is related to interest on the cash accounts.

Net (loss) for the three months ending December 31, 2008 and 2007 was a loss of
$1,673,565 and $1,695,786, respectively. The decrease is net loss of $22,221 was
primarily the result of lower amortization of the discount on debt conversion
and lower operating expenses offset by the lower gross profit and higher loss on
revaluation of derivatives.

LIQUIDITY AND CAPITAL RESOURCES

On April 1, 2005, we entered into a Securities Purchase Agreement with YA Global
for the sale of $2,500,000 of secured convertible debentures. The agreement was
amended and restated on July 20, 2006 and January 4, 2007 to reflect the change
in the funding formulas. Pursuant to the terms of the agreement with YA Global,
on April 1, 2005 we issued a secured convertible debenture in the principal
amount of $1,250,000. On July 20, 2006, the secured convertible debenture was
amended and restated and reissued in an aggregate principal amount of
$1,330,308, which included accrued and unpaid interest on the original
convertible debenture of $80,308. On January 4, 2007, we issued a second secured
convertible debenture to YA Global in the principal amount of $625,000. These
debentures are convertible into Class A common stock at the discretion of the
holders. These transactions required the Company to register for resale a number
of shares to facilitate these financial transactions. The Company was unable to
complete the registration statement in the time specified in the Registration
Rights Agreement and as such, continues to incur liquidated damage charges as
specified therein.

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<PAGE>

The Company is seeking additional operating income opportunities through
potential acquisitions or investments. Such acquisitions or investments may
consume cash reserves or require additional cash or equity. Our working capital
and additional funding requirements will depend upon numerous factors,
including: (i) strategic acquisitions or investments; (ii) an increase to
current company personnel; (iii) the level of resources that we devote to sales
and marketing capabilities; (iv) technological advances; and (v) the activities
of competitors.

To date, the Company has incurred substantial losses, and will require financing
for working capital to meet its operating obligations. While we have raised
sufficient working capital to fund our operations for what we believe should be
sufficient for the next 6 months, we will subsequently need to raise additional
capital to fund our future operations. We anticipate that we will require
financing on an ongoing basis for the foreseeable future to fund our working
capital needs.

During the six months ended December 31, 2008, the Company had a net decrease in
cash of $24,681 and during the six months ended December 31, 2007, the Company
had a net decrease in cash of $206,658. The Company's principal use of funds
during these periods was as follows:

CASH FLOWS FROM OPERATING ACTIVITIES. The Company used $24,681 and $202,551 in
cash from operations in the six months ended December 31, 2008 and 2007,
respectively. The net reduction of $177,870 was primarily the result of a lower
utilization of cash in operations (net operating loss after adding back non-cash
items but before considering changes in certain assets and liabilities), an
increase in collections of accounts receivable and deferrals of executive
compensation offset by increases in inventory and the paydown of trade payables.

CASH FLOWS FROM INVESTING ACTIVITIES. The Company has no investing activities
for the six months ended December 31, 2008. For the six months ending December
31, 2007, the Company invested $4,107 to create a trade show booth for
exhibitions and to upgrade their back office network.

OFF-BALANCE SHEET ARRANGEMENTS

The Company has no off-balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that is material to investors.

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<PAGE>

FORWARD LOOKING STATEMENTS - CAUTIONARY FACTORS

Certain information included in this Form 10-Q and other materials filed or to
be filed by us with the Securities and Exchange Commission (as well as
information included in oral or written statements made by us or on our behalf),
may contain forward-looking statements about our current and expected
performance trends, growth plans, business goals and other matters. These
statements may be contained in our filings with the Securities and Exchange
Commission, in our press releases, in other written communications, and in oral
statements made by or with the approval of one of our authorized officers.
Information set forth in this discussion and analysis contains various
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The Private
Securities Litigation Reform Act of 1995 (the "Act") provides certain "safe
harbor" provisions for forward-looking statements. The reader is cautioned that
such forward-looking statements are based on information available at the time
and/or management's good faith belief with respect to future events, and are
subject to risks and uncertainties that could cause actual performance or
results to differ materially from those expressed in the statements.
Forward-looking statements speak only as of the date the statement was made. We
assume no obligation to update forward-looking information to reflect actual
results, changes in assumptions or changes in other factors affecting
forward-looking information. Forward-looking statements are typically identified
by the use of terms such as "anticipate," "believe," "could," "estimate,"
"expect," "intend," "may," "might," "plan," "predict," "project," "should,"
"will," and similar words, although some forward-looking statements are
expressed differently. Although we believe that the expectations reflected in
such forward-looking statements are reasonable, we can give no assurance that
such expectations will prove to be correct.



                                       26
<PAGE>

ITEM 4T. CONTROLS AND PROCEDURES

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING.

Management of the Company has evaluated, with the participation of the Chief
Executive Officer and Chief Financial Officer of the Company, the effectiveness
of the Company's disclosure controls and procedures (as defined in Rules
13a-15(e) or 15d-15(e) promulgated by the Securities and Exchange Commission
pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange
Act")) as of the end of the period covered by this Quarterly Report on Form
10-Q. Based on that evaluation, the Chief Executive Officer and Chief Financial
Officer of the Company had concluded that the Company's disclosure controls and
procedures as of the period covered by this Quarterly Report on Form 10-Q were
not effective for the following reasons:

           a) A deficiency was identified as the Company's limited segregation
of duties amongst the Company's employees with respect to the Company's control
activities. This deficiency is the result of the Company's limited number of
employees. This deficiency may affect management's ability to determine if
errors or inappropriate actions have taken place. Management is required to
apply its judgment in evaluating the cost-benefit relationship of possible
changes in our disclosure controls and procedures.

           b) A deficiency was identified in respect to the Company's Board of
Directors. This deficiency is the result of the Company's limited number of
external board members. This deficiency may give the impression to the investors
that the board is not independent from management. Management and the Board of
Directors are required to apply their judgment in evaluating the cost-benefit
relationship of possible changes in the organization of the Board of Directors.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING.

Management of the Company has also evaluated, with the participation of the
Chief Executive Officer of the Company, any change in the Company's internal
control over financial reporting that occurred during the period covered by this
Quarterly Report on Form 10-Q and determined that there was no change in the
Company's internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, the Company's internal
control over financial reporting.

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<PAGE>

PART II - OTHER INFORMATION

ITEM 5. OTHER INFORMATION

(b)  The Company does not have a standing nominating committee or a committee
     performing similar functions as the Company's Board of Directors consists
     of only two members and therefore there would be no benefit in having a
     separate nominating committee that would consist of the same number of
     members as the full board of directors. Both members of the Board of
     Directors participate in the consideration of director nominees.


ITEM 6. EXHIBITS


     31.1  Rule 13a-14(a)/15d-14(a) Certifications.

     32.1  Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant
           to Section 906 of the Sarbanes-Oxley Act of 2002.




















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<PAGE>

                                   SIGNATURES

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

MM2 Group, Inc.

By: /s/ Mark Meller                                      Date: February 17, 2009
    -----------------
    Mark Meller, President,
    Chief Executive Officer and
    Principal Accounting Officer

















                                       29
<PAGE>

                                INDEX OF EXHIBITS


     31.1  Rule 13a-14(a)/15d-14(a) Certifications.

     32.1  Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant
           to Section 906 of the Sarbanes-Oxley Act of 2002.






















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