Securities and Exchange Commission
                            Washington, DC 20549

                                FORM 10-QSB

               Quarterly Report Under Section 13 or 15(d) of
                    the Securities Exchange Act of 1934

For the Quarter Ended                                Commission File Number
   June 30, 2004                                               0-27727


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

                                   NEVADA
                                 ---------
       (State or other jurisdiction of incorporation or organization)

                                 91-1766174
                               -------------
                    (I.R.S. Employer Identification No.)


                       9852 West Katella Ave., #363
                         Anaheim, California 92804
                   --------------------------------------
                  (Address of principal executive offices)

                               (714) 740-0601
                             -----------------
            (Registrant's telephone number, including area code)


Securities registered pursuant to Section 12 (b) of the Act: None.

Securities registered pursuant to section 12(g) of the Exchange Act:
Common, $0.001 par value

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.   X   Yes       No
                                                 -----    -----


As of August 20, 2004, the Company had 76,979,864 shares of its $.001 par
value, Common Stock outstanding.


                                                                      Page
                                                                     ------

PART I.  FINANCIAL INFORMATION

Item 1.    Unaudited Consolidated Condensed Financial Statements
           Consolidated Condensed Balance Sheet as of
           June 30, 2004 (Unaudited) and December 31, 2003

        Unaudited Consolidated Condensed Statement of Operations
           for the three months and six months ended June 30, 2003
           and 2004 and for the period from inception, August 13,
           2002, to June 30, 2004

        Unaudited Consolidated Condensed Statement of Stockholders'
           Deficit for the six months ended June 30, 2004 and for the
           period from inception, August 13, 2002, to June 30, 2004

        Unaudited Consolidated Condensed Statement of Cash Flows
           for the six months ended June 30, 2004 and 2003 and
           for the period from inception, August 13, 2002, to
           June 30, 2004

        Notes to Unaudited Consolidated Condensed Financial Statements

Item 2.    Plan of Operations

Item 3.    Controls and Procedures

PART II.  OTHER INFORMATION

Item 2.    Changes in Securities

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

Item 6.    Exhibits and Reports on Form 8-K

        Signatures




                       PART I - FINANCIAL INFORMATION


ITEM 1.  FINANCIAL STATEMENTS



                     REDWOOD ENTERTAINMENT GROUP, INC.
                  (A CORPORATION IN THE DEVELOPMENT STAGE)
                                 __________




           UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                               June 30, 2004

























                                          F-1


                     REDWOOD ENTERTAINMENT GROUP, INC.
                  (A CORPORATION IN THE DEVELOPMENT STAGE)
                             TABLE OF CONTENTS
                                 __________

                                                                      Page
                                                                     ------

Unaudited Consolidated Condensed Financial Statements:

  Consolidated Condensed Balance Sheet as of
     June 30, 2004 (Unaudited) and December 31, 2003                  F-3

  Unaudited Consolidated Condensed Statement of Operations
     for the three months and six months ended June 31,
     2003 and 2004 and for the period from inception, August
     13, 2002, to June 30, 2004                                       F-4

  Unaudited Consolidated Condensed Statement of Stockholders'
     Deficit for the six months ended June 30, 2004 and
     for the period from inception, August 13, 2002, to
     June 30, 2004                                                    F-5

  Unaudited Consolidated Condensed Statement of Cash Flows
     for the six months ended June 30, 2004 and 2003 and
     for the period from inception, August 13, 2002, to
     June 30, 2004                                                    F-6

  Notes to Unaudited Consolidated Condensed Financial Statements      F-7
































                                    F-2

                     REDWOOD ENTERTAINMENT GROUP, INC.
                  (A CORPORATION IN THE DEVELOPMENT STAGE)
                    CONSOLIDATED CONDENSED BALANCE SHEET
                    June 30, 2004 and December 31, 2003
                                 __________
<Table>
<Caption>

                                                        June 30,      December
                                                        30, 2004      31, 2003
                                                       (Unaudited)     (Note)
                                                      ------------  ------------
<S>                                                  <C>           <C>
                                     ASSETS
                                     -------

Current assets:
  Cash and cash equivalents                           $    23,915   $     6,973
                                                      ------------  ------------
     Total current assets                                  23,915         6,973

Investment in SaVi Group                                  238,500         -
                                                      ------------  ------------
     Total assets                                     $   262,415   $     6,973
                                                      ============  ============

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

Current liabilities:
  Note payable to a bank                              $    35,000   $    60,000
  Note payable to stockholder                                -           49,672
  Obligations under acquisition agreement                 189,594       180,490
  Accounts payable and accrued liabilities                 65,973        73,040
  Accounts payable assumed in recapitalization            159,295       178,487
                                                      ------------  ------------
   Total current liabilities                              449,862       541,689
                                                      ------------  ------------
Commitment and contingencies

Stockholders' deficit:
  Common stock, $.001 par value, 100,000,000 shares
   shares authorized, 76,979,684 and 55,479,684 shares
   issued and outstanding at June 30, 2004 and
   December 31, 2003, respectively                         76,980        55,479
  Additional paid-in capital                            3,514,055     2,965,556
  Losses accumulated during the development stage      (3,778,482)   (3,555,751)
                                                      ------------  ------------
     Total stockholders' deficit                         (187,447)     (534,756)
                                                      ------------  ------------
     Total liabilities and stockholders' deficit      $   262,415   $     6,973
                                                      ============  ============
</Table>

Note:  The balance sheet at December 31, 2003 has been derived from the
audited financial statements at that date but does not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements.


                The accompanying notes are an integral part
       of the unaudited consolidated condensed financial statements.
                                    F-3

                     REDWOOD ENTERTAINMENT GROUP, INC.
                  (A CORPORATION IN THE DEVELOPMENT STAGE)
               CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
 for the three months and six months ended June 30, 2004 and 2003 and for
        the period from inception, August 13, 2002, to June 30, 2004
                                 __________
<Table>
<Caption>

                                                                          Inception
                          Three Months Ended        Six Months Ended          to
                             June 30,                  June 30,             June 30,
                         2004         2003        2004          2003          2003
                     -----------  ----------- -----------  ------------  ------------
<S>                 <C>          <C>         <C>          <C>           <C>
Interest income      $      285   $     -     $      285    $      -      $      297
                     -----------  ----------- -----------  ------------  ------------
Cost and expenses:
  Operating, general
   and administrative
   expenses, except
   stock-based
   compensation         150,440       69,771     158,174        61,822       475,495
  Stock-based
   compensation             -         10,000         -       1,030,917     2,403,206
  Cost of
   recapitalization         -            -           -             -         273,987
  Goodwill impairment       -            -           -             -         541,101
  Cost of rescission     43,074          -        43,074           -          43,074
  Interest expense       15,099        1,213      21,768         1,200        41,916
                     -----------  ----------- -----------  ------------  ------------
     Total costs and
     expenses           208,613       80,983     223,016     1,093,939     3,778,779
                     -----------  ----------- -----------  ------------  ------------
     Net loss        $ (208,328)  $  (80,983) $ (222,731)  $(1,093,939)  $(3,778,482)
                     ===========  =========== ===========  ============  ============
Weighted average
  shares
  outstanding        63,718,814   16,303,384  60,430,504    16,053,684
                     ===========  =========== ===========  ============
Net loss per common
  share              $    (0.00)  $    (0.00) $    (0.00)  $     (0.07)
                     ===========  =========== ===========  ============




</Table>







                The accompanying notes are an integral part
       of the unaudited consolidated condensed financial statements.
                                    F-4

                     REDWOOD ENTERTAINMENT GROUP, INC.
                  (A CORPORATION IN THE DEVELOPMENT STAGE)
         CONSOLIDATED CONDENSED STATEMENT OF STOCKHOLDERS' DEFICIT
     for the three months ended June 30, 2004 and for the period from
                inception, August 13, 2002, to June 30, 2004
                                 __________
<Table>
<Caption>
                                                                   Losses
                                                              Accumulated
                                         Additional            During the
                                           Deferred    Subscr-   Develop-
               Common Stock      Paid-In    Compen-    iption        ment
           Shares     Amount     Capital     sation Receivable      Stage     Total
       ---------- ----------  ---------- ---------- ---------- ---------- ----------
<S>   <C>        <C>         <C>        <C>        <C>        <C>        <C>
Balance
at inception,
August
13, 2002
         $   -      $   -       $   -      $   -      $   -      $   -

Initial
contribution
to establish
Energy
Resource
Management, Inc.
             300        -         1,020        -          -          -        1,020

Recapitalization
on August 26, 2002
      13,338,384     13,338     (13,338)       -          -          -           -

Common stock
issued in
exchange for
consulting
services
       2,715,000      2,715    2,230,435 (1,030,917)      -          -    1,202,233

Net loss
            -          -           -          -           -   (1,555,838) (1,555,838)
       ---------- ----------  ---------- ---------- ---------- ---------- ----------
Balance
at
December
31, 2002
       16,053,684 $   16,053  $2,218,117 $(1,030,917)$    -   $(1,555,838)$ (352,585)
       ---------- ----------  ---------- ---------- ---------- ---------- ----------
       ---------- ----------  ---------- ---------- ---------- ---------- ----------

</Table>







                The accompanying notes are an integral part
       of the unaudited consolidated condensed financial statements.
                                    F-5

                     REDWOOD ENTERTAINMENT GROUP, INC.
                  (A CORPORATION IN THE DEVELOPMENT STAGE)
         CONSOLIDATED CONDENSED STATEMENT OF STOCKHOLDERS' DEFICIT
     for the three months ended June 30, 2004 and for the period from
                inception, August 13, 2002, to June 30, 2004
                                 __________
<Table>
<Caption>
                                                                   Losses
                                                              Accumulated
                                         Additional            During the
                                           Deferred    Subscr-   Develop-
               Common Stock      Paid-In    Compen-    iption        ment
           Shares     Amount     Capital     sation Receivable      Stage     Total
       ---------- ----------  ---------- ---------- ---------- ---------- ----------
<S>   <C>        <C>         <C>        <C>        <C>        <C>        <C>
Balance at
December
31, 2002
      16,053,684  $  16,053   $2,218,117 $(1,030,917)$     -   $(1,555,838)$(352,585)

Consulting
services
recognized
under
consulting
agreements
               -          -           -    1,030,917       -            -  1,030,917

Common
stock
issued
for
cash
     10,450,000      10,450     144,550           -        -            -    155,000

Common
stock
issued
in
exchange
consulting
services
and for
employee
compensation
      3,001,000       3,001     167,055           -        -            -    170,056

Common
stock
issued
in
exchange
for
extension
of
acquisition
agreement
        275,000         275        4,125           -        -            -     4,400

Common
stock
issued
to a
charitable
Organization
     5,700,000        5,700       85,500           -         -            -   91,200

Common
stock
issued
to
escrow
for
DreamCity
acquisition
    20,000,000       20,000     340,000       -         -           -   360,000

Interest
imputed
on loan
from
Stockholder
             -           -       6,209       -         -           -     6,209


Net loss     -           -           -       -         -      (1,999,913) (1,999,913)
       ---------- ----------  ---------- ---------- ---------- ---------- ----------
Balance
at
December
31, 2003
       55,479,684 $   55,479  $2,965,556 $      -   $      -  $(3,555,751)$ (534,716)
       ---------- ----------  ---------- ---------- ---------- ---------- ----------
       ---------- ----------  ---------- ---------- ---------- ---------- ----------

</Table>







                The accompanying notes are an integral part
       of the unaudited consolidated condensed financial statements.
                                    F-6

                     REDWOOD ENTERTAINMENT GROUP, INC.
                  (A CORPORATION IN THE DEVELOPMENT STAGE)
         CONSOLIDATED CONDENSED STATEMENT OF STOCKHOLDERS' DEFICIT
     for the three months ended June 30, 2004 and for the period from
                inception, August 13, 2002, to June 30, 2004
                                 __________
<Table>
<Caption>
                                                                   Losses
                                                              Accumulated
                                         Additional            During the
                                           Deferred    Subscr-   Develop-
               Common Stock      Paid-In    Compen-    iption        ment
           Shares     Amount     Capital     sation Receivable      Stage     Total
       ---------- ----------  ---------- ---------- ---------- ---------- ----------
<S>   <C>        <C>         <C>        <C>        <C>        <C>        <C>
Balance
at
December
31, 2003
       55,479,684 $   55,479  $2,965,556 $      -   $      -  $(3,555,751)$ (534,716)

Common
stock
issued
for
acquisition
of 20% of
Savi Group
       10,000,000     10,000     190,000        -           -          -     200,000

Common
stock
issued
as
collateral
to secure
the payment
of fees to
legal counsel
        5,000,000      5,000      (5,000)       -           -          -        -

Common
stock
returned
for
cancellation
upon
rescission
of
agreement
with Energy
Resource
Management,
Inc.
("ERMI").
The  owner of
ERMI retained
5,000,000
of the
12,000,000
shares
originally
issued to
satisfy a
note payable
and related
accrued
interest and
as a fee
for the
rescission
      (7,000,000)    (7,000)      107,000    -           -          -     100,000

Common stock
issued for
cash
       13,500,000    13,501       256,499    -           -           -     270,000

Net loss
            -          -            -        -           -      (222,731)  (222,731)
       ---------- ----------  ---------- ---------- ---------- ---------- ----------
Balance
at June
30, 2004
       76,979,684 $  76,980   $3,514,055 $    -     $      -  $(3,778,482) $(187,447)
       ---------- ----------  ---------- ---------- ---------- ---------- ----------
       ---------- ----------  ---------- ---------- ---------- ---------- ----------


</Table>






                   The accompanying notes are an integral part
          of the unaudited consolidated condensed financial statements.
                                       F-7



                            REDWOOD ENTERTAINMENT GROUP, INC.
                         (A CORPORATION IN THE DEVELOPMENT STAGE)
                      CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
     for the three months ended June 30, 2004 and 2003 and for the period from
                   inception, August 13, 2002, to June 30, 2004
                                        __________

<Table>
<Caption>
                                                                              Inception
                                                     Six Months Ended            to
                                                            June 30,           June 30,
                                                       2004        2003          2004
                                                  ------------ ------------ ------------
<S>                                              <C>          <C>          <C>


Cash flows from operating activities:
  Net loss                                        $  (222,731) $(1,174,942) $(3,778,482)
  Adjustments to reconcile net loss to net
   cash used by operating activities                   33,173    1,107,917    3,393,205
                                                  ------------ ------------ ------------
    Net cash used by operating activities            (189,558)     (67,025)    (385,277)
                                                  ------------ ------------ ------------
Cash flows from investing activities:
  Deposit for acquisition of SaVi Group               (38,500)       -          (38,500)
                                                  ------------ ------------ ------------
    Net cash used by investing activities             (38,500)       -          (38,500)

Cash flows from financing activities:
   Proceeds from stockholder advances                     -          -           49,672
   Proceeds from other notes payable                      -         70,000        -
   Payments on notes payable                          (25,000)      (3,000)     (28,000)
   Proceeds from sale of common stock                 270,000       17,000      426,020
                                                  ------------ ------------ ------------
     Net cash provided by financing activities        245,000       84,000      447,692

Net increase (decrease) in cash and cash
  equivalents                                          16,942          (25)      23,915

Cash and cash equivalents at beginning of period       6,973            35         -
                                                  ------------ ------------ ------------
Cash and cash equivalents at end of period        $   23,915   $        10  $    23,915
                                                  ============ ============ ============











</Table>







                       The accompanying notes are an integral part
         of these unaudited consolidated condensed financial statements.
                                             F-6


<PAGE>
                         REDWOOD ENTERTAINMENT GROUP, INC.
                      (A CORPORATION IN THE DEVELOPMENT STAGE)
                NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                     __________

1.   Organization and Summary of Significant Accounting Policies

Redwood Entertainment Group Inc. (the "Company") is a Nevada Corporation
that intends to acquire companies operating in the entertainment industry.
The Company originally intended to engage in energy marketing and
providing energy related products and services to commercial, industrial
and manufacturing customers, as well as wholesale entities such as
municipalities, rural electric co-ops and local distribution companies;
however, a change in the Company's business plan was adopted (See Note 3).
The Company is considered a development stage enterprise because it
currently has no significant operations, has not yet generated revenue
from new business activities and is devoting substantially all of its
efforts to business planning and the search for sources of capital to fund
its efforts.

The Company was originally incorporated as Energy Resource Management,
Inc. on August 13, 2002 and subsequently adopted name changes to Redwood
Energy Group, Inc. and Redwood Entertainment Group, Inc., upon completion
of a recapitalization on August 26, 2002.  The re-capitalization occurred
when the Company acquired the non-operating public shell of Gene-Cell,
Inc.  Gene-Cell had no significant assets or operations at the date of
acquisition and the Company assumed all liabilities that remained from its
prior discontinued operation as a biopharmaceutical research company.  The
historical financial statements presented herein are those of Redwood
Entertainment Group, Inc. and its predecessors, Redwood Energy Group, Inc.
and Energy Resource Management, Inc.

The non-operating public shell used to recapitalize the Company was
originally incorporated as Becniel and subsequently adopted name changes
to Tzaar Corporation, Gene-Cell, Inc., Redwood Energy Group, Inc. and
finally its current name, Redwood Entertainment Group, Inc.

Significant Estimates

The preparation of consolidated condensed 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 dates of the consolidated
condensed financial statements and the reported amounts of revenues and
expenses during the periods.  Actual results could differ from estimates
making it reasonably possible that a change in the estimates could occur
in the near term.

Principles of Consolidation

The consolidated condensed financial statements include the accounts of
the Company and its wholly owned subsidiaries after elimination of all
significant intercompany accounts and transactions.











                                     F-7


<PAGE>
                         REDWOOD ENTERTAINMENT GROUP, INC.
                      (A CORPORATION IN THE DEVELOPMENT STAGE)
                NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                     __________

1.   Organization and Summary of Significant Accounting Policies, continued

     Interim Financial Statements

The accompanying unaudited consolidated condensed financial statements
have been prepared in accordance with accounting principles generally
accepted in the United States of America for interim financial information
and with the instructions to Form 10-QSB and Article 10 of Regulation S-B.
Accordingly, they do not include all of the information and footnotes
required by accounting principles generally accepted in the United States
of America for complete financial statements.  In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included.
Operating results for the three month and six month periods ended June 30,
2004 are not necessarily indicative of the results that may be expected
for the respective full years.


2.   Going Concern Considerations

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern.  The Company is presently a
shell company and has limited operations and resources.  The Company has
a net loss of $3,778,482 for the period from inception, August 13, 2002,
to June 30, 2004. Additionally, at June 30, 2004, the Company is in a
negative working capital position of $425,947 and a stockholders' deficit
position of $187,447. Such matters raise substantial doubt about the
Company's ability to continue as a going concern.  These financial
statements do not include any adjustment that might result from the
outcome of this uncertainty.

The Company plans to develop into a technology based company and/or an
independent multimedia entertainment company.

There can be no assurances that the Company will be able to raise adequate
short-term capital to sustain its current operations as a development
stage company, that the Company can raise adequate long-term capital from
private placement of its common stock or private debt to implement its
business plan. There can also be no assurances that the Company will ever
attain profitability.  The Company's long-term viability as a going
concern is dependent upon certain key factors, as follows:

-    The Company's ability to obtain adequate sources of funding to
     sustain it during the development stage.  Sources of funding may
     not be available on terms that are acceptable to the Company and
     existing stockholders, or may include terms that will result in
     substantial dilution to existing stockholders.











                                     F-8


<PAGE>
                         REDWOOD ENTERTAINMENT GROUP, INC.
                      (A CORPORATION IN THE DEVELOPMENT STAGE)
                NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                     __________

2.   Going Concern Considerations, continued

-    The ability of the Company to implement its business plan and
     become a viable technology company and/or entertainment company.

-    The ability of the Company to ultimately achieve adequate
     profitability and positive cash flows to sustain its operations.


3.   Recapitalization

On August 26, 2002, Gene-Cell, Inc. entered into an agreement and Plan of
Reorganization (the "Agreement") whereby the Company agreed to acquire all
of the issued and outstanding shares of Energy Resource Management, Inc.
("ERM") in exchange for 4,000,000 restricted common shares.  The Agreement
represented a re-capitalization of ERM with accounting treatment similar
to that used in a reverse acquisition, except that no goodwill or
intangible is recorded. A re-capitalization is characterized by the merger
of a private operating company into a non-operating public shell
corporation with nominal net assets and typically results in the owners
and managers of the private company having effective or operating control
after the transaction.  ERM, the private operating company, emerged as the
surviving financial reporting entity under the Agreement, but Gene-Cell,
Inc. remained as the legal reporting entity. The accompanying financial
statements present the historical financial results of ERM.

Subsequent to the recapitalization, the name of Gene-Cell, Inc. was
changed to Redwood Energy Group, Inc. and then its current name, Redwood
Entertainment Group, Inc.

The consideration given by the Company in the recapitalization was
approximately $274,000 and was achieved through the assumption of a note
payable, accounts payable and accrued liabilities of the public shell.


4.   Income Taxes

The difference between the income tax benefit in the accompanying
statement of operations and the amount that would result if the U.S.
Federal statutory rate of 34% were applied to pre-tax loss for the three
months ended June 30, 2004 is primarily attributable to non-deductible
compensation expense and an increase in the valuation allowance recorded
to reduce deferred tax assets to their estimated net realizable value.

At June 30, 2004, for federal income tax and alternative minimum tax
reporting purposes, the Company has approximately $3,225,000 of unused net
operating losses available for carryforward to future years.  The benefit
from carryforward of such net operating losses will expire in various
years between 2011 and 2024.  The benefit from utilization of net
operating loss carryforwards incurred prior to August 26, 2002 was
significantly limited in connection with a recapitalization.  Such benefit
could be subject to further limitations if significant future ownership
changes occur in the Company.  The Company currently believes that a
significant portion of its unused net operating loss carryforwards will
never be utilized due to expiration or limitations on use due to ownership
changes.



                                  Continued
                                     F-9


                      REDWOOD ENTERTAINMENT GROUP, INC.
                 (A CORPORATION IN THE DEVELOPMENT STAGE)
            NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                                 __________


5.   Acquisition of Savi Group

On March 31, 2003, the Company entered into a letter of intent to acquire
20% of SaVi Group. In connection with this proposed transaction, the
Company put up a deposit of $9,000.  The proposed transaction was
completed during the quarter ended June 30, 2004 upon payment of an
additional $29,500 (bringing total cash payments to $38,500) and issuance
to the Savi Group of 10,000,000 shares of the Company's common stock
valued at $200,000. The total purchase price was $238,500.

Savi Group, owns various technologies that the company intends to
commercialize.

6.   Stockholders' Equity

During the six months ended June 30, 2004, the Company engaged in various
transactions affecting stockholders' equity, as follows:

-    The Company issued 13,500,000 shares of common stock to approximately 10
     individual investors at a price of $0.02 per share.

-    The Company issued 5,000,000 shares of common stock to the owner of
     Energy Resource Management, Inc. to rescend a re-capitalization
     transaction that occurred in 2002. The shares issued in connection with
     the rescission were valued at $100,000. Under the terms of the
     rescission, 12,000,000 common shares issued in the re-capitalization
     transaction were returned to the Company and debt to the stockholder
     of $49,672 and related accrued interest of $7,254 were fully satisfied.

-    The Company issued 5,000,000 shares of common stock to its legal counsel
     as collateral to secure payment of legal fees of approximately $50,000.



7.   Non-Cash Investing and Financing Transactions

During the six months ended June 30, 2004, the Company engaged in various
non-cash investing and financing activities as follows:

-    Issued 10,000,000 shares of common stock for $200,000 of the acquisition
     price of Savi Group.

-    Issued shares of common stock to satisfy debt to a stockholder of
     $49,672.











































                                    F-10



ITEM 2.  PLAN OF OPERATIONS

This Form 10-QSB contains certain forward-looking statements.  For this purpose
any statements contained in this Form 10-QSB that are not statements of
historical fact may be deemed to be forward-looking statements.  Without
limiting the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "estimate" or "continue" or comparable terminology are intended
to identify forward-looking statements.  These statements by their nature
involve substantial risks and uncertainties, and actual results may differ
materially depending on a variety of factors.

Critical Accounting Policies and Estimates

     Our discussion and analysis of our financial condition and results of
operations are based upon our consolidated financial statements, which have been
prepared in accordance with accounting principles generally accepted in the
United States of America.  The preparation of these financial statements
requires us to make estimates and judgments that affect the reported amounts of
assets, liabilities, revenue and expenses, and related disclosure of contingent
assets and liabilities.  On an ongoing basis, we evaluate our estimates and our
estimates are based on historical experience and on various other assumptions
that are believed to be reasonable under the circumstances. These estimates and
assumptions provide a basis for our judgments about the carrying values of
assets and liabilities that are not readily apparent from other sources.  Actual
results may differ from our estimates under different assumptions or conditions,
and these differences may be material.

     We believe that the following critical accounting policies affect our
more significant judgments and estimates used in the preparation of our
consolidated financial statements:

     Income Taxes - We use the liability method of accounting for income taxes.
Under this method, deferred income taxes are recorded to reflect the tax
consequences on future years of temporary differences between the tax basis of
assets and liabilities and their financial amounts at year-end.  We provide a
valuation allowance to reduce deferred tax assets to their net realizable value.

     Stock-Based Compensation - We follow the disclosure and reporting
requirements of Financial Accounting Standard No. 123, "Accounting for
Stock-Based Compensation" ("SFAS No. 123") for stock-based employee
compensation plans.  SFAS No. 123 defined a fair value based method of
accounting for an employee stock option or similar equity instrument and
encouraged all entities to adopt that method of accounting for all of their
employee stock compensation plans and include the cost in the income statement
as compensation expense.  However, it also allowed entities to continue to
measure compensation cost for those plans using the intrinsic value based
method of accounting prescribed by Accounting Principles Board ("APB")
Opinion No. 25, "Accounting for Stock Issued to Employees".  We account for
compensation cost for stock option plans in accordance with APB Opinion No.
25. History of the Company


     We were organized on November 3, 1986, to pursue any lawful purpose or
purposes.  We amended our Articles of Incorporation on September 30, 1987,
changing our name to Tzaar Corporation and authorizing common stock of
100,000,000 shares at par value of $0.001. From 1989 to 1996, we did not engage
in any business activity.  During this time we had no significant revenues and
was considered to be a "development stage company."

     On December 28, 1996, we entered into a Plan of Reorganization with
Genesystems, Inc. ("Genesystems"), a corporation organized in the state of
Nevada on December 12,1996.  In connection with the Plan of Reorganization,
we made a one for ten reverse split of its outstanding shares; issued an
additional 7,500,000 post-split restricted shares to effect a share exchange
with Genesystems; and authorized and issued an additional 3,500,000 common
shares in a limited offering.  As a result of the reverse acquisition, control
of our company was acquired by Genesystem shareholders.  The acquisition of the
public shell (Tzaar Corporation) was accounted for as a recapitalization.

     In December 1996, we changed our name to Genecell, Inc. and appointed
new officers and directors.  On September 29, 1997 we changed our name to
Gene-Cell, Inc.  From December 1996 to December 2002, we focused our plan of
operations on the business of developing therapies that can treat major
diseases and disorders of the human blood system.

     On August 26, 2002, Gene-Cell, Inc., entered into an Agreement and Plan of
Reorganization (the "Agreement") whereby we acquired all of the issued and
outstanding shares of Energy Resource Management, Inc., ("ERM") in exchange for
4,000,000 restricted common shares.

     The Agreement represented a recapitalization of ERM with accounting
treatment similar to that used in a reverse acquisition.  In the reorganization,
ERM assumed our accounts payable and accrued liabilities.  These 4,000,000
shares of common stock that we issued became 12,000,000 post-forward split.

     In the first quarter of 2003, we entered into an agreement to acquire
DreamCity Entertainment as an expansion of our business plan into the
entertainment sector.  We closed on the acquisition under modified terms
during the fourth quarter of 2003.  We are now considering and negotiating
the types of projects that we will undertake in DreamCity; however, any
projects DreamCity undertakes will be characterized as high quality,
principle-centered and multicultural with profits resulting from thorough
brand exploitation.

      On March 31, 2004, we entered into a letter of intent to acquire a 20%
interest in SaVi Group, Incorporated, a company that specializes in creating and
patenting innovative products and technologies.  In connection with this
proposed transaction, we paid a non-refundable deposit of $9,000.  The proposed
transaction is based on total cash payments by us of $38,500.  The transaction
is contingent on the negotiation and consummation of a definitive agreement
between the parties, payment of the full $38,500 by us within the next 12 months
and SaVi producing revenue within the same twelve month period.  The acquisition
is also contingent on us finalizing the one share for twenty five shares reverse
split of our outstanding common shares and a name change of the Company to SaVi
Media Group, Inc., or such other similar name as may be available.  Both of
these actions were approved by our shareholders at a recent shareholder meeting.
In connection with the consummation of the transaction, SaVi will also be issued
up to 1,000,000 shares of our post-reverse split common stock.  We continue to
negotiate with SaVi and expect to have a definitive agreement in place in the
near future.


    We continue to be considered as a development stage enterprise because we
have not yet generated revenue from sale of our products and/or services.
Since our inception, we have devoted substantially all of our efforts to
development of a business plan and the search for sources of capital to fund
our efforts.

Business of the Company

     We intend to conduct business in the entertainment sector and complimentary
media activities and/ or the technology sector.  We have discontinued our
biotechnology and energy sector activities.

     Given our desire to focus in new areas of business and the lack of success
that we experienced in an effort to enter the energy marketing business, we
decided to rescind our Agreement and Plan of Reorganization with Energy
Resource Management, Inc.

     In connection with the rescission, the 12,000,000 shares issued in that
transaction were returned to the Company for cancellation.  Additionally, we
have re-assumed the debt obligations that were assumed by ERM as a condition
to the Agreement and Plan of Reorganization and all right, title and interest
in and to the energy marketing business plan of ERM will be returned to ERM.

Results of Operations

     During the period from inception, August 13, 2002, to June 30, 2004, we
have not generated any revenue from operations.  As of June 30, 2004, we had
losses accumulated in the development stage of $3,778,482 funded by paid-in
capital. We financed our operations mainly through the sale of common stock
and have been entirely dependent on outside sources of financing for
continuation of operations.  For the remainder of fiscal 2004, we will continue
to pursue funding for our business.  As stated previously, there is no
assurance that we will continue to be successful in obtaining additional
funding on attractive terms or at all, nor that the projects towards which
additional paid-in capital is assigned will generate revenues at all.

Plan of Operation

     During the quarter ended June 30, 2004, we had limited operations and
have been focused on the proposed acquisition of a 20% interest in SaVi Group
and the further development of Dreamcity Entertainment. Our planned operations
are expected to require cash of approximately $1,500,000 over the next twelve
months.  Those funds will be used to consummate the SaVi Group acquisition and
to support continued operation in the development stage.

     Our plan of operations will require sources of funding that may not be
available on terms that are acceptable to management and existing stockholders,
or may include terms that will result in substantial dilution to existing
stockholders.

Liquidity and Capital Resources

     We currently have no significant commitments for capital expenditures.
Since our inception, we have expended a significant portion of our resources to
develop business strategies and to search for sources of capital.  Our efforts
have and will continue to require significant amounts of capital.

     We believe that our existing cash reserves and cash flows from operations
will not be sufficient to cover the Company's cash requirements for 2004.  We
will need to successfully raise funds through an equity infusion or the issuance
of debt securities. Financing may not be available on terms acceptable to us, or
at all.  Further, the sale of additional equity or convertible debt securities
may result in dilution to our stockholders.

     Our independent accountants provided us with their reports for the past two
fiscal years ended December 31, which sets forth factors that raise substantial
doubt about our ability to continue as a going concern.  Nothing occurred in the
second quarter of the current fiscal year to alleviate these doubts.  Our
viability as a going concern remains dependent on our ability to raise short-
term cash funds and ultimately achieve a sustaining level of profitability.
There can be no assurances that we will succeed in our efforts.

     During February 2004, the Company sold a total of 4,250,000 shares of its
common stock for $72,725.  $12,725 of those proceeds were received in the
quarter ended March 31, 2004, the remaining balance was paid out during the
second quarter 2004.

ITEM 3.   CONTROLS AND PROCEDURES

      Our Chief Executive Officer and Chief Financial Officer have conducted an
evaluation of our disclosure controls and procedures as of a date (the
"Evaluation Date") within 90 days before the filing of this quarterly report.
Based on their evaluation, our Chief Executive Officer and Chief Financial
Officer have concluded that our disclosure controls and procedures are
effective to ensure that information required to be disclosed by us in reports
that we file or submit under the Securities Exchange Act of 1934 is recorded,
processed, summarized and reported within the time periods specified in the
applicable Securities and Exchange Commission rules and forms.

     Subsequent to the Evaluation Date, there were no significant changes in
the Company's internal controls or in other factors that could significantly
affect these controls, nor were any corrective actions required with regard to
significant deficiencies and material weaknesses

PART II - OTHER INFORMATION

ITEM 2.   CHANGES IN SECURITIES

     No instruments defining the rights of the holders of any class of
registered securities have been materially modified, limited or qualified.

     The following securities, which are not registered under the Securities
Act of 1933, were issued by the Company during the quarter ended June 30, 2004.

     During the quarter, the Company sold an aggregate of 13,500,000 restricted
common shares to nine investors for a total of $270,000.  The shares were
issued without registration under the Securities Act of 1933 in reliance on an
exemption from registration provided under Section 4(2) of the Securities Act.

     During the quarter, the Company issued 5,000,000 restricted common shares
to counsel for the Company to collateralize payment of outstanding legal fees
owed by the Company.  Once the outstanding legal fees are paid, the shares
will returned for cancellation and return to the treasury of the Company.
The shares were issued without registration under the Securities Act of 1933 in
reliance on an exemption from registration provided under Section 4(2) of the
Securities Act.

     In connection with the rescission of the Agreement and Plan of
Reorganization with Energy Resource Management, Inc., during the quarter, the
Company issued 5,000,000 shares to Robert Gower in satisfaction of debts
incurred by Mr. Gower on behalf of the Company during his term as president
of the Company.  The shares were issued without registration under the
Securities Act of 1933 in reliance on an exemption from registration provided
under Section 4(2) of the Securities Act.

     In connection with the proposed acquisition of a 20% interest in SaVi
Group, the Company issued 10,000,000 shares to Serge V. Monros.  The shares
were issued without registration under the Securities Act of 1933 in reliance
on an exemption from registration provided under Section 4(2) of the
Securities Act.

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

     On August 17, 2004, the Company held a special meeting of stockholders.
The total number of shares available to be voted at the meeting was 76,979,684.
At the meeting the shareholders were asked to vote on the following matters:

1)   To approve a proposed amendment to the Articles of Incorporation of the
     Company to change the name of the Company to Savi Media Group, Inc., or
     such other similar name as may be available.  50,656,465 shares voted for
     this proposal, 20,500,000 voted against this proposal.

2)   To approve a proposed amendment to the Articles of Incorporation of the
     Company to increase it's authorized common stock from 100,000,000 shares
     to 1,000,000,000.  50,656,465 shares voted in favor of this matter,
     20,500,000 voted against this matter.

3)   To approve a proposed amendment to the Articles of Incorporation of the
     Company to effect a reverse split of the outstanding common stock at an
     exchange ratio of one share for twenty-five shares with no share
     certificate currently exceeding 100 common shares being reduced below
     100 common shares and all share certificates representing fewer than 100
     common shares being unaffected by the reverse split.  50,656,465 shares
     voted in favor of this proposal, 20,500,000 shares voted against this
     proposal.

4)   To elect five individuals to the board of directors of the Company.
     Michael R. Davis, Serge V. Monros, Philip Pisanelli, Kathy Procopio,
     Mario Procopio and Michael Davis were nominated by the board of directors
     to fill the five authorized board positions.  Prior to the shareholder
     meeting Michael Davis withdrew as a nominee for the board.  At the
     shareholder meeting, the following additional individuals were nominated
     by the shareholders:  Ben Lofstedt, James Webber, Don Kopaloff and Dick
     Battalian.

     In accordance with the bylaws of the Company and the voting procedures set
forth in the proxy statement of the Company, approval of the nominees for
election to the board of directors required the affirmative vote of a majority
of the votes entitled to be cast by the holders of the outstanding shares of
common stock represented at the Special Meeting in person or by proxy.  The
following five individuals received a majority of the votes entitled to be
cast at the meeting and therefore have been appointed as the board of directors
of the Company:

                          For             Abstain
Serge V. Monros       50,656,465          20,500,000
Philip Pisanelli      50,656,465          20,500,000
Kathy Procopio        50,656,465          20,500,000
Mario Procopio        50,656,465          20,500,000
Ben Lofstedt          40,000,000          20,500,000

     James Webber, Don Kopaloff and Dick Battalian each received 20,500,00
votes.

5)   To ratify the selection of Ham, Langston & Brezina, L.L.P., as the
     Company's independent certified public accountants for the 2004 fiscal
     year.  50,656,456 shares voted in favor of this proposal, 20,500,000
     shares voted against this proposal.

6)   To ratify the actions of our officers and directors for the last
     fiscal year, and for the period from the fiscal year end through
     the date of the special shareholder meeting.  50,656,456 shares
     voted in favor of this proposal, 20,500,000 shares voted against
     this proposal.

7)   To investigate and pursue application to convert the Company to a
     "business development company."  50,656,456 shares voted in favor
     of this proposal, 20,500,000 shares voted against this proposal.

ITEM 5.  OTHER INFORMATION

     Following the shareholder meeting, the board of directors met and
appointed Mario Procopio as President, Chief Executive Officer and
Chairman of the Board of Directors and Serge Monros and Chief Technology
Officer of the Company.  Kathy Procopio will continue as Chief Financial
Officer, Secretary and Treasurer of the Company.

     Following is a brief description of the business experience of the
officers and directors of the Company.

     Ben Lofstedt, J.D., D.D., Director.  Mr. Lofstedt earned a Bachelor of
Science, degree in electrical engineering from Loyola University of Los Angeles
in 1963.  He earned an Juris Doctorate degree from Western State University,
College of Law in 1972, and earned an honorary Doctor of Divinity from Southern
California Community Bible College, Doctor of Divinity in 2000.  Mr. Lofstedt
has been in private legal practice since founding his own law firm in 1978.
From 1977-1988 he was also employed as a patent counsel for Acorn Engineering
Co., City of Industry, California.  Mr. Lofstedt is not a director of any other
reporting company.  Mr. Lofstedt is 63 years old.

     Serge v. Monros, Director and Chief Technology Officer. Since 1993, Mr.
Monros has served as the Chief Technology Officer of Integrated Micro Systems,
located in Vista, California.  In his capacity as Chief Technology Officer, he
has overseen research & development projects, administered hardware, software,
LAN/WAN protocols and forecasted and developed budgets.  Mr. Monros has also
been responsible for the coordination and supervision of project teams and work
processes.  In addition to Integrated Micro Systems, in 1993, Mr. Monros formed
and continues to operate S.V. Monros Company, a research and development lap and
patent holding company, which owns a number of patents.  From 1981 to 1993. Mr.
Monros worked for Rockwell industries as a Senior System Analyst in their Space
Transportation Service Division where he designed and manufactured special
tooling of space shuttle program.  Mr. Monros is 53 years old.

     Philip Pisanelli, Director.  Mr. Pisanelli has been employed with Boeing
since 1981.  Since 1984 he has served as a Senior Metrologist.  While at Boeing,
Mr. Pisanelli has worked closely with NASA and many other companies in the
fields of aerospace and other developing technologies.  Mr. Pisanelli is 56
years old.

     Kathy Procopio, Th.D., Chief Financial Officer, Secretary, Treasurer and
Director.  Dr. Procopio has extensive experience in financial services with 23
years in the marketplace.  Her background includes working for Drexel Burnham
Lambert stock brokerage in its Beverly Hills office as administrative supervisor
and managing 60 sales support staff.  Dr. Procopio in another private company
provided executive oversight for a billionaire heiress who provides financial
services for high profile clients in Hollywood.  Asset management for these
portfolios was in excess of $250 billion, managed in approximately 50 different
accounts.  Dr. Procopio is 46 years old.

     Mario Procopio, Th. D., President, Chief Executive Officer and Director.
Dr. Mario Procopio owned a financial services/asset management company for the
past twelve years which had grown to a sales force of more than 60 licensed
agents and 1,000 clients with more than $ 10 million in assets under
management. Dr. Procopio is a founder of a non-profit organization consisting
of 107 licensed ministers of which 44 of them are missionaries.  He oversees
about 22 churches and 4,000 people who are affiliated with the ministry.
He holds a Doctorate of Divinity and a Doctorate of Theology degree.  Dr.
Procopio currently co-hosts a half hour talk show with Adelphia TV on local
cable television.  Dr. Procopio is 42 years old.

     Mario Procopio and Kathy Procopio are married.  There are no other family
relationships among our officers and directors.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a) Reports on Form 8-K

No reports on Form 8-K were filed during the quarter ended June 30, 2004.

(b) Exhibits.

The following exhibits are included as part of this report:

Exhibit 31.1  Certification of Chief Executive Officer Pursuant to
              Section 302 of the Sarbanes-Oxley Act of 2002

Exhibit 31.2  Certification of Chief Financial Officer Pursuant to
              Section 302 of the Sarbanes-Oxley Act of 2002

Exhibit 32.1  Certification of Chief Executive Officer Pursuant to
              Section 906 of the Sarbanes- Oxley Act of 2002.

Exhibit 32.2  Certification of Chief Financial Officer Pursuant to
              Section 906 of the Sarbanes- Oxley Act of 2002.


                                    SIGNATURES

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


               Redwood Entertainment Group, Inc.



August 23, 2004              /S/ Mario Procopio
                             --------------------------------------
                             Mario Procopio, Chief Executive Officer



August 23, 2004             /S/ Kathy Procopio
                            --------------------------------------
                            Kathy Procopio, Chief Financial Officer