UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington D.C. 20549

                                  ------------

                                   FORM 10-KSB

                  Annual Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934

For the fiscal year ended June 30, 2002        Commission File Number 000-28876

                      INTEGRATED HEALTH TECHNOLOGIES, INC.
            (Exact name of small business registrant in its charter)

         Delaware                                              22-2407475
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                               Identification No.)

   201 Route 22, Hillside, New Jersey                             07205
(Address of principal executive offices)                        (Zip code)

Registrant's telephone number: (973) 926-0816

Securities registered under Section 12(b) of the Exchange Act: None.

Securities registered under Section 12(g) of the Exchange Act:

                     Common Stock $.002 par value per share
                              (Title of each class)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the Registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

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

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

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

Registrant's revenues for the fiscal year ended June 30, 2002 were $23,546,630.

The aggregate market value of the voting stock held by non-affiliates of the
Registrant based on the trading price of the Registrant's Common Stock on August
30, 2002 was $ 1,005,750.

The number of shares outstanding of each of the Registrant's classes of common
equity, as of the latest practicable date:


            Class                                 Outstanding at August 30, 2002
 Common Stock $.002 par value                            6,228,720 Shares
Class C Redeemable Common Stock
      Purchase Warrants                                  150,000 Warrants

                       DOCUMENTS INCORPORATED BY REFERENCE

The information required by part III will be incorporated by reference to
certain portions of a definitive Proxy Statement which is expected to be filed
by the Registrant within 120 days after the close of its fiscal year.


<PAGE>

              INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES

                            FORM 10-KSB ANNUAL REPORT

                                      INDEX

Part I                                                                      Page

Item 1.     Description of Business                                            1

Item 2.     Description of Properties                                          3

Item 3.     Legal Proceedings                                                  4

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

Part II

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

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

Item 7.     Financial Statements                                               9

Item 8.     Changes in and Disagreements with Accountants on
            Accounting and Financial Disclosure                                9

Part III

Item 9.     Directors, Executive Officers, Promoters, and Control
            Persons; Compliance With Section 16(a) of the Exchange Act        10

Item 10.    Executive Compensation                                            10

Item 11.    Security Ownership of Certain Beneficial Owners and
            Management                                                        10

Item 12.    Certain Relationships and Related Transactions                    10

Item 13.    Exhibits and Reports on Form 8-K                                  10

Signatures

<PAGE>

                                     PART I

Disclosure Regarding Forward-Looking Statements

All statements other than statements of historical fact, in this Form 10-KSB,
including without limitation, the statements under "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and "Description of
Business" are, or may be deemed to be, forward looking statements. These
statements represent the Company's current judgment and are subject to risks and
uncertainties that could cause actual results to differ materially. Such risks
and uncertainties include, without limitation: (i) loss of a major customer,
(ii) competition, and/or (iii) government regulation.

Item 1. Description of Business

Effective January 5, 2001 Chem International, Inc. amended its corporate charter
and changed its name to Integrated Health Technologies, Inc. [the "Company"].
The Company, a Delaware corporation, is the survivor of a merger of Chem
International, Inc. a Delaware Corporation, with and into Frog Industries, Ltd.
a New York corporation, which was effected on December 27, 1994 with Frog
Industries, Ltd. renamed Chem International Inc. after the merger. The Company
was reincorporated in Delaware on February 2, 1996. The Company is engaged
primarily in manufacturing, marketing and sales of vitamins, nutritional
supplements and herbal products, including vitamins sold as single entity
supplements, in multi-vitamin combinations and in varying potency levels and in
different packaging sizes. The Company's subsidiary, Manhattan Drug Company,
Inc. ["Manhattan Drug"], manufactures the vitamins and nutritional supplements
for sale to distributors, multilevel marketers and specialized health-care
providers. The Company also manufactures such products for sale under its own
private brand, "Vitamin Factory", through mail order. On July 1, 2000, the
Company began offering solid dosage product development and technical services
through its subsidiary, Integrated Health Ideas, Inc. On August 31, 2000, the
Company began the distribution and sale of fine chemicals through a new
subsidiary IHT Health Products, Inc. The Company considers all subsidiaries as
one segment of business.

Development and Supply Agreement

On April 9, 1998, the Company signed a development and supply agreement with
Herbalife International of America, Inc. ["Herbalife"] whereby the Company will
develop, manufacture and supply certain nutritional products to Herbalife
through December 31, 2002.

Risk of Reduction of Significant Revenues from Major Customer

The Company derives a significant portion of its sales from one customer,
Herbalife International, Inc. ["Herbalife"] for which it manufactures vitamins
and nutritional supplements. Sales to Herbalife expressed as a percentage of the
Company's total sales, were approximately 43% and 28%, respectively, for the
fiscal years ended June 30, 2002 and 2001. The loss of this customer would have
a material affect on the Company's operations.

Dependence on Key Personnel

The Company is highly dependent on the experience of its management in the
continuing development of its manufacturing and retail operations. The loss of
the services of these certain individuals, particularly E. Gerald Kay, Chairman
of the Board, and director of the Company, would have a material adverse effect
on the Company's business. The Company has obtained key-man life insurance in
the amount of $1,000,000 on the life of Mr. Kay, with the Company as the named
beneficiary.


                                       1
<PAGE>

Raw Materials

The principal raw materials used in the manufacturing process are natural and
synthetic vitamins, minerals, herbs, and related nutritional supplements,
gelatin capsules and coating materials and the necessary components for
packaging the finished products. The raw materials are available from numerous
sources within the United States. The gelatin capsules and coating materials and
packaging materials are similarly widely available. Raw materials are generally
purchased by the Company without long-term commitments, on a purchase order
basis. The Company's principal suppliers are Roche Vitamins, Inc., Triarco Inc.
and Nutrichem Resources Company.

Employees

As of June 30, 2002, the Company had 94 full time employees, of whom 50 belonged
to a local unit of the Teamsters Union and are covered by a collective
bargaining agreement, which expires August 31, 2002. The contract has been
renewed through August 31, 2006.

Seasonality

The Company's results of operations are not significantly affected by seasonal
factors.

Trademarks

The Company owns the registration in the United States Patent and Trademark
offices for "Oxitiva." Oxitiva is the Company's brand of chewable antioxidant
formula.

Government Regulations

The manufacturing, processing, formulation, packaging, labeling and advertising
of the Company's products are subject to regulation by a number of federal
agencies, including the Food and Drug Administration [the "FDA"], the Federal
Trade Commission [the "FTC"], the United States Postal Service, the Consumer
Product Safety Commission and the United States Department of Agriculture. The
FDA is primarily responsible for the regulation of the manufacturing, labeling
and sale of the Company's products. The Company's activities are also regulated
by various state and local agencies in which the Company's products are sold.
The operation of the Company's vitamin manufacturing facility is subject to
regulation by the FDA as a food manufacturing facility. In addition, the United
States Postal Service and the FTC regulate advertising claims with respect to
the Company's products sold by solicitation through the mail.

The Dietary Supplement Health and Education Act of 1994 [the "Dietary Supplement
Act"] was enacted on October 25,1994. The Dietary Supplement Act amends the
Federal Food, Drug and Cosmetic Act by defining dietary supplements, which
include vitamins, minerals, nutritional supplements and herbs, and by providing
a regulatory framework to ensure safe, quality dietary supplements and the
dissemination of accurate information about such products. Dietary supplements
are regulated as foods under the Dietary Supplement Act and the FDA is generally
prohibited from regulating the active ingredients in dietary supplements as food
additives, or as drugs unless product claims trigger drug status.

The Dietary Supplement Act provides for specific nutritional labeling
requirements for dietary supplements effective January 1, 1997. The Dietary
Supplement Act permits substantiated, truthful and non-misleading statements of
nutritional support to be made in labeling, such as statements describing
general well being from consumption of a dietary ingredient or the role of a
nutrient or dietary ingredient in affecting or maintaining structure or function
of the body. In addition, the Dietary Supplement Act also authorizes the FDA to
promulgate Current Good Manufacturing Practices ["cGMP"] specific to the
manufacture of dietary supplements, to be modeled after food cGMP. The Company
currently manufactures its dietary supplement products pursuant to food


                                       2
<PAGE>

cGMP. The Company believes that it is currently in compliance with all
applicable government regulations. The FDA will be proposing and promulgating
regulations to implement the Dietary Supplement Act. The Company cannot
determine what effect such regulations, when promulgated, will have on its
business in the future or what cost it will add to manufacturing the product.
Such regulations could, among other things, require expanded or different
labeling, the recall, reformulation or discontinuance of certain products,
additional record keeping and expanded documentation of the properties of
certain products and scientific substantiation regarding ingredients, product
claims and safety of efficacy.

Competition

The business of manufacturing, distributing and marketing vitamins and
nutritional supplements is highly competitive. Many of the Company's competitors
are substantially larger and have greater financial resources with which to
manufacture and market their products. In particular, competition is fierce in
the retail segment. Many direct marketers not only focus on selling their own
branded products, but offer national brands at discounts as well. Many
competitors have established brand names recognizable to consumers. In addition,
major pharmaceutical companies offer nationally advertised multivitamin
products. The Company also competes with certain of its customers who have their
own manufacturing capabilities.

Many of the Company's competitors in the retailing segment have the financial
resources to advertise freely to promote sales and to produce sophisticated
catalogs. In many cases, such competitors are able to offer price incentives for
retail purchasers and offer participation in frequent buyers programs. Some
retail competitors also manufacture their own products whereby they have the
ability and financial incentive to sell their own product.

Product Liability Insurance

The Company intends to compete by stressing the quality of its manufacturing
product, providing prompt service, competitive pricing of products in its
marketing segment and by focusing on niche products in the international retail
markets.

The Company, like other manufacturers, wholesalers and distributors of vitamin
and nutritional supplement products, faces an inherent risk of exposure to
product liability claims if, among other things, the use of its products result
in injury. Accordingly, the Company currently maintains product liability
insurance policies, which provides a total of $10 million of coverage per
occurrence and $10 million of coverage in the aggregate. There can be no
assurance that the Company's current level of product liability insurance will
continue to be available or, if available, will be adequate to cover potential
liabilities.

Item 2. Description of Properties

On January 10, 1997, the Company entered into a lease agreement for
approximately 84,000 square feet of factory, warehouse and office facilities in
Hillside, New Jersey. The facilities are leased from Vitamin Realty Associates,
L.L.C., a limited liability company, which is owned by the Company's Chairman of
the Board, and principal stockholder and certain family members and 10% owned by
the Company's chief financial officer. The lease has a term of five years and
expires on January 10, 2002. The lease provides for a base annual rental of
$346,000 plus increases in real estate taxes and building expenses. At its
option, the Company has the right to renew the lease for an additional five year
period. The space is utilized for the retail mail order business, warehousing
and packaging operations and also houses the Company's corporate offices. On
April 28, 2000 the lease was amended reducing the square footage to
approximately 75,000 square feet and extending the lease to May 31, 2015.

The Company leased 40,000 square feet of manufacturing facilities in Hillside,
New Jersey from Morristown Holding Company, Inc. (formerly Gerob Realty
Partnership), of which E. Gerald Kay, Chairman of the Board of


                                       3
<PAGE>

the Company, is a majority shareholder. The lease which expired on December 31,
2000 provided for a minimum annual rental of $60,000 plus payment of all real
estate taxes. On August 30, 2000 the Company acquired the manufacturing facility
by issuing 1,050,420 shares of its common stock in exchange for the property
based upon an appraisal by an independent party. The space is utilized for
Manhattan Drug's tablet manufacturing operations.

Item 3. Legal Proceedings

There are no matters that are currently under litigation.

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

No matters were submitted to a vote of security holders during the fourth
quarter ended June 30, 2002.

The Company's accounting policies are described in Note 3 of the consolidated
financial statements included in the Company's Annual Report on Form 10-K for
the fiscal year ended June 30, 2002. The consolidated financial statements are
prepared in accordance with accounting principles generally accepted in the
United States of America, which 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 revenues and expenses during the
reporting period. Actual results could differ from those estimates.


                                       4
<PAGE>

                                     PART II

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

Effective January 5, 2001 the Company changed its name to "Integrated Health
Technologies, Inc." and began trading using the NASDAQ symbol IHTC for its
common stock and the symbol IHTCW for its redeemable warrants.

The Class A Redeemable Common Stock Purchase Warrants expired on October 28,
2001 and were no longer traded on the Electronic Bulletin Board.

Set forth below are the high and low closing prices of the Common Stock and the
Class A Redeemable Warrant as reported on the Nasdaq National Market for the
period July 1, 2000 through April 25, 2001 and on the Electronic Bulletin Board
for the period April 25, 2001 through June 30, 2002:

                                                                HIGH       LOW
COMMON STOCK [CXIL/IHTC]

FISCAL YEAR ENDED JUNE 30, 2001
First Quarter                                                 $2.4063    $0.8750
Second Quarter                                                $1.9375    $0.4375
Third Quarter                                                 $1.0625    $0.5000
Fourth Quarter                                                $0.8125    $0.2188

FISCAL YEAR ENDED JUNE 30, 2002
First Quarter                                                 $0.2500    $0.1100
Second Quarter                                                $0.3500    $0.0700
Third Quarter                                                 $0.8000    $0.2400
Fourth Quarter                                                $0.6000    $0.3200

CLASS A REDEEMABLE WARRANTS CXILW/IHTCW]

FISCAL YEAR ENDED JUNE 30, 2001
First Quarter                                                 $0.6562    $0.1875
Second Quarter                                                $0.3438    $0.0312
Third Quarter                                                 $0.1875    $0.0625
Fourth Quarter                                                $0.0938    $0.0100

FISCAL YEAR ENDED JUNE 30, 2002
First Quarter                                                 $0.0100    $0.0100
Second Quarter                                                $0.0100    $0.0100

As of June 30, there were approximately 600 holders of record of the Company's
Common Stock.

The Company has not declared or paid a dividend with respect to its Common Stock
nor does the Company anticipate paying dividends in the foreseeable future.


                                       5
<PAGE>

Item 6.

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

The following discussion should be read in conjunction with the historical
financial statements of the Company and notes thereto.

Results of Operations

Year ended June 30, 2002 Compared to the Year ended June 30, 2001

The Company's net income for the year ended June 30, 2002 was $1,393,045 as
compared to the net loss of $(1,449,903) for the year ended June 30, 2001. This
increase in net income of approximately $3,000,000 is primarily the result of a
$3,000,000 increase in operating income resulting from a corresponding increase
in gross profit of approximately $3,200,000, an increase in other income of
approximately $1,300,000 due to the settlement of a Class Action Lawsuit and an
increase in Federal and state income taxes of approximately $1,500,000.

Sales for the years ended June 30, 2002 and 2001 were $23,546,630 and
$15,293,090, respectively, an increase of approximately 54%. For the year ending
June 30, 2002 the Company had sales to one customer, who accounted for 43% of
net sales in 2002 and 28% in 2001. The loss of this customer would have an
adverse affect on the Company's operations.

Retail and mail order sales for the year ended June 30, 2002 totaled $173,065 as
compared to $447,701 for the year ended June 30, 2001, a decrease of 61%. The
Company has been experiencing a decline in retail mail order sales due to
increased competition. The Company closed its retail store on March 2, 2001.

Sales under the Roche Vitamins, Inc. distribution agreement were $2,455,623 for
the year ended June 30, 2002 as compared to $2,264,256 for the year ended June
30, 2001, an increase of 8%.

On July 1, 2000 the Company began offering solid dosage product development and
technical services through its subsidiary, Integrated Health Ideas, Inc.
Consulting revenues for the year ended June 30, 2002 totaled $448,361 as
compared to $458,757 for the year ended June 30, 2001, a decrease of $10,396 or
2%.

On August 31, 2000 the Company began the distribution and sale of fine chemicals
through a new subsidiary, IHT Health Products, Inc. Sales for the year ended
June 30, 2002 totaled $3,678,382 as compared to sales for the ten months ended
June 30, 2001 of $3,765,490.

Cost of Sales increased to $18,842,688 in 2002 as compared to $13,820,829 for
2001. Cost of sales decreased as a percentage of sales to 80% as compared to 90%
for 2001. The decrease in cost of sales of 10% is due to greater manufacturing
efficiencies due to the 54% increase in sales. The company's sales volume has
increased to cover its fixed overhead.

Selling and administrative expenses for the year ending June 30, 2002 were
$3,905,893 versus $3,758,957 for the same period a year ago. The increase of
$146,936 was primarily attributable to a decrease in advertising of
approximately $71,000, an increase in commission and royalty expense of
approximately $88,000, an increase in freight out of approximately $34,000, an
increase in bad debt expenses of approximately $41,000, a decrease in officers
salaries of approximately $108,000, an increase in office salaries of
approximately $185,000, an increase in office expenses of approximately $60,000,
a decrease in professional fees of approximately $115,000, a decrease in public
relations fees of approximately $50,000 and an increase in auto, entertainment
and lodging of


                                       6
<PAGE>

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

Results of Operations [Continued]

approximately $23,000.

Other income (expense) was $1,486,422 for the year ended June 30, 2002 as
compared to $189,328 for the same period a year ago. This increase in other
income of approximately $1,300,000 is primarily the result of the proceeds
received of $1,157,960 from the settlement of a Class Action Lawsuit for the
year ended June 30, 2002 and the increase in administrative fee income of
approximately $130,000.

Year ended June 30, 2001 Compared to the Year ended June 30, 2000

The Company's net loss for the year ended June 30, 2001 was $(1,449,903) as
compared to the net income of $3,143,695 for the year ended June 30, 2000. This
decrease in net income of approximately $4,600,000 is primarily the result of a
$300,000 decrease in operating income resulting from an increase in gross profit
of approximately $185,000 and an increase in selling and administrative expenses
of approximately $485,000, a decrease in other income of approximately
$6,100,000 due to the settlement of a Class Action Lawsuit and a decrease in
Federal and State income taxes of approximately $1,500,000.

Sales for the years ended June 30, 2001 and 2000 were $15,293,090 and
$17,974,885, respectively, a decrease of $2,681,795 or 15%. For the year ending
June 30, 2001 the Company had sales to one customer who accounted for 28% of net
sales in 2001 and 51% of net sales in 2000. The loss of this customer would have
an adverse affect on the Company's operations.

Retail and mail order sales for the year ended June 30, 2001 totaled $447,701 as
compared to $679,612 for the year ended June 30, 2000, a decrease of 34%. The
Company has been experiencing a decline in retail mail order sales due to
increased competition. The Company closed its retail store on March 2, 2001.

Sales under the Roche Vitamins, Inc. distribution agreement were $2,264,256 as
compared to $2,689,575 for the year ended June 30, 2000, a decrease of 16%.

On July 1, 2000 the Company began offering solid dosage product development and
technical services through its subsidiary, Integrated Health Ideas, Inc.
Consulting revenues for the year ended June 30, 2001 totaled $458,757.

On August 31, 2000 the Company began the distribution and sale of fine chemicals
through a new subsidiary, IHT Health Products, Inc. Sales for the ten months
ended June 30, 2001 totaled $3,765,490.

Cost of Sales decreased to $13,820,829 in 2001 as compared to $16,687,844 for
2000. Cost of sales decreased as a percentage of sales to 90% as compared to 93%
for 2000. The decrease in cost of sales is due to greater manufacturing
efficiencies.

Selling and administrative expenses for the year ending June 30, 2001 were
$3,758,957 versus $3,276,435 for the same period a year ago. The increase of
$482,522 was primarily attributable to a decrease in advertising of
approximately $120,000, an increase in freight out of approximately $42,000, a
decrease in bad debt expenses of approximately $130,000, a decrease in officers
salaries of approximately $70,000, an increase in office salaries of
approximately $350,000 due to the commencement of the IHT Health Products, Inc.
distribution business, a decrease in consulting fees of approximately $175,000,
an increase in insurance expense of approximately $45,000, an increase in
depreciation expense of approximately $43,000, an increase in professional fees
of


                                       7
<PAGE>

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

Results of Operations [Continued]

approximately $70,000, an increase in public relations fees of approximately
$70,000 and an increase in auto, entertainment and lodging of approximately
$198,000.

Other income (expense) was $189,328 for the year ended June 30, 2001 as compared
to $6,047,145 for the same period a year ago. This decrease in other income of
approximately $6,000,000 is primarily the result of the proceeds received of
$6,143,849 from the settlement of a Class Action Lawsuit against three bulk
vitamin suppliers for the year ended June 30, 2000.

Liquidity and Capital Resources

At June 30, 2002 the Company's working capital was $4,899,564 an increase of
$1,211,748 over working capital at June 30, 2001. Cash and cash equivalents were
$2,063,323 at June 30, 2002 an increase of $1,687,739 from June 30, 2001. The
Company generated $2,771,776 and utilized $1,517,415 for operations for the
years ended June 30, 2002 and 2001, respectively. The primary reasons for the
increase in cash generated from operations are net income of approximately
$1,400,000, an increase in accounts receivable of approximately $139,000 a
decrease in inventory of approximately $890,000 a decrease in refundable Federal
Income Taxes of approximately $625,000, and a decrease in accounts payable of
approximately $540,000. The Company believes that the anticipated sales for next
year will meet cash needs for operations.

The Company utilized $354,344 and generated $10,934 in investing activities for
the years ended June 30, 2002 and 2001, respectively. The Company utilized
$729,693 and generated $129,056 from financing activities for the years ended
June 30, 2002 and 2001, respectively.

The Company's total annual commitments at June 30, 2002 for long term
non-cancelable leases of $4,327,344 consists of obligations under operating
leases for facilities and lease agreements for the rental of warehouse
equipment, office equipment and automobiles.

The Company has a $1,000,000 revolving line of credit agreement which bears
interest at 4% above the prime interest rate and expires on December 31, 2003.
At June 30, 2002 the balance due under the second line was $3,568.

New Accounting Pronouncement

In July 2001, FAS No. 141, "Business Combinations" ("FAS 141") and FAS No. 142
"Goodwill and Other Intangible Assets" ("FAS 142") were issued. FAS 141 requires
that the purchase method of accounting be used for all business combinations
initiated after June 30, 2001. FAS 141 also specifies the criteria that
intangible assets acquired in a purchase method business combination must be
recognized and reported apart from goodwill. FAS 142 requires that goodwill and
intangible assets with indefinite useful lives no longer be amortized, but
instead be tested for impairment, at least annually, in accordance with the
provisions of FAS 142. FAS 142 will also require that intangible assets with
definite useful lives be amortized over their respective estimated useful lives
to their estimated residual values, and be reviewed for impairment in accordance
with FAS No. 121, "Accounting for the Impairment of Long-lived Assets and
Long-lived Assets to be Disposed of". The provisions of FAS 141 are effective
immediately, except with regard to business combinations prior to July 1, 2001.
FAS 142 will be effective as of July 1, 2002. Goodwill and other intangible
assets acquired in business combinations completed before July 1, 2001, will
continue to be amortized prior to the adoption of FAS 142. The Company does not
anticipate that this statement will have any impact on its financial position
and results of operations.


                                       8
<PAGE>

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

Results of Operations [Continued]

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be disposed of." SFAS No.144
establishes a single accounting model for long-lived assets to be disposed of by
sale and requires that those long-lived assets be measured at the lower of
carrying amount of fair value less cost to sell, whether reported in continuing
operations or in discontinued operations. SFAS No. 144 is effective for fiscal
years beginning after December 15, 2001. The Company does not anticipate that
this statement will have a material impact on its financial position and results
of operations.

Impact of Inflation

The Company does not believe that inflation has significantly affected its
results of operations.

Item 7. Financial Statements

For a list of financial statements filed as part of this report, see index to
financial statement at F-1.

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

NONE


                                       9
<PAGE>

                                    PART III

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

Incorporated by reference to the Company's Proxy Statement for Annual Meeting of
Stockholders to be filed with the Securities and Exchange Commission within 120
days after the close of the fiscal year ended June 30, 2002.

Item 10. Executive Compensation

Incorporated by reference to the Company's Proxy Statement for Annual Meeting of
Stockholders to be filed with the Securities and Exchange Commission within 120
days after the close of the fiscal year ended June 30, 2002.

Item 11. Security Ownership of Certain Beneficial Owners and Management

Incorporated by reference to the Company's Proxy Statement for Annual Meeting of
Stockholders to be filed with the Securities and Exchange Commission within 120
days after the close of the fiscal year ended June 30, 2002.

Item 12. Certain Relationships and Related Transactions

Incorporated by reference to the Company's Proxy Statement for Annual Meeting of
Stockholders to be filed with the Securities and Exchange Commission within 120
days after the close of the fiscal year ended June 30, 2002.

Item 13. Exhibits and Reports on Form 8-K

(a)   The following documents are filed as part of this report:

      (1) A list of the financial statements filed as part of this report is set
      forth in the index to financial statements at Page F-1 and is incorporated
      herein by reference.

      (2) Exhibits

     Number         Description
     ------         -----------

      3.1   Restated Certificate of Incorporation of Registrant (1)

      3.2   By-Laws of Registrant (1)

      4.1   Form of Amended Warrant Agreement among the Registrant and
            Continental Stock Transfer & Trust Company, as Warrant Agent (1)

      4.2   Specimen Common Stock Certificate of Registrant (2)

      4.3   Specimen Class A Warrant Certificate of Registrant (2)

      10.1  Employment Agreement, effective January 1, 1996, between the
            Registrant and Ronald G. Smalley (1)

      10.2  Employment Agreement, effective July 1, 1996, between the Registrant
            and E. Gerald Kay (1)

      10.3  Employment Agreement, effective July 1, 1996, between the Registrant
            and Eric Friedman (1)

      10.4  Employment Agreement, effective July 1, 1996, between the Registrant
            and Riva L. Kay (1)

      10.5  Employment Agreement, effective July 1, 1996, between the Registrant
            and Christina M. Kay (1)

      10.6  Lease Agreement, dated January 1, 1996, between the Registrant and
            Gerob Realty Partnership (1)

      10.7  Stock Option Plan (2)

      10.8  Amended Employment Agreement, effective September 20, 1996, between
            the Registrant and E. Gerald Kay (3)


                                       10
<PAGE>

      10.9  Lease Agreement, dated August 3,1994, between the Registrant and
            Hillside 22 Realty Associates, L.L.C. (2)

      10.10 Exclusive License Agreement between the Registrant and International
            Nutrition Research Center, Inc. andamendments, dated April 29, 1997
            and November 27, 1996 (4)

      10.11 Lease Agreement between the Registrant and Vitamin Realty
            Associates, dated January 10, 1997 (4)

      10.12 Manufacturing Agreement between Chem International, Inc. and
            Herbalife International of America, Inc. dated April 9, 1998 (5)

      10.13 Manufacturing Agreement between Chem International, Inc. and Pilon
            International, PLC. dated February 14,1998 (5)

      10.14 Stock Sale Agreement between the Company and Gerob Realty
            Partnership (5)

      10.15 Promissory note between the Company and E. Gerald Kay dated March
            12, 1998 (5)

      10.16 Class C Warrant to purchase common stock dated March 12, 1998 (5)

      10.17 Consulting Agreement with Buttonwood Advisory Group dated March 20,
            1998 (5)

      10.18 Employment Agreement, effective July 1, 1999, between the Registrant
            and Eric Friedman (6)

      10.18 Employment Agreement, effective July 1, 1999, between the Registrant
            and Riva Sheppard (6)

      10.18 Employment Agreement, effective July 1, 1999, between the Registrant
            and Christina Kay (6)

      10.18 Employment Agreement, effective February 16, 1999, between the
            Registrant and Abdulhameed Mirza (6)

      16.1  Letter on changes in certifying accountants (6)

      21    Subsidiaries of the Registrant

      27    Financial Data Schedule

      99.1  Certification of Periodic Report (7)

----------

      (1)   Incorporated herein by reference to the corresponding exhibit number
            to the Registrants Registration Statement of Form SB-2, Registration
            No. 333-5240-NY.

      (2)   Incorporated herein by reference to the corresponding exhibit number
            to the Registrants Registration Statement Amendment No. 1 on Form
            SB-2, Registration No. 333-5240-NY.

      (3)   Incorporated herein by reference to the corresponding exhibit number
            to the Registrants Registration Statement Amendment No. 2 on Form
            SB-2, Registration No. 333-5240-NY.

      (4)   Incorporated herein by reference to the corresponding exhibit number
            to the Registrants Annual Report on Form 10-KSB for the fiscal year
            ended June 30, 1997, filed on September 29, 1997, Commission File
            No. 000-28876.

      (5)   Incorporated herein by reference to the corresponding exhibit number
            to the Registrants Annual Report on Form 10-KSB for the fiscal year
            ended June 30, 1998, filed on September 23, 1998, Commission File
            No. 000-28876.

      (6)   Incorporated herein by reference to the corresponding exhibit number
            to the Registrants Annual Report of From 10-KSB for the fiscal year
            ended June 30, 1999, filed on September 30, 1999, Commission File
            No. 000-28876.

      (7)   Filed herewith.

(b)   No reports on Form 8-K were filed by the Registrant during the last
      quarter of the period covered by this report.



                                       11
<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES

INDEX

Item 7:  Consolidated Financial Statements

Independent Auditor's Report........................................F-2

Consolidated Balance Sheet as of June 30, 2002......................F-3 ... F-4

Consolidated Statements of Operations for the years
ended June 30, 2002 and 2001........................................F-5

Consolidated Statements of Stockholders' Equity for the years
ended June 30, 2002 and 2001........................................F-6

Consolidated Statements of Cash Flows for the years
ended June 30, 2002 and 2001........................................F-7 ... F-8

Notes to Consolidated Financial Statements..........................F-9 ... F-18


                                 . . . . . . . .


                                      F-1
<PAGE>

INDEPENDENT AUDITOR'S REPORT

To the Stockholders and Board of Directors of
   Integrated Health Technologies, Inc.


      We have audited the accompanying consolidated balance sheet of Integrated
Health Technologies, Inc. and Subsidiaries (formerly Chem International, Inc.)
as of June 30, 2002, and the related consolidated statements of operations,
stockholders' equity, and cash flows for the years ended June 30, 2002 and 2001.
These consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

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

      In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position of
Integrated Health Technologies, Inc. and its subsidiaries as of June 30, 2002,
and the consolidated results of their operations and their cash flows for the
years ended June 30, 2002 and 2001 in conformity with accounting principles
generally accepted in the United States.


                                            /s/ Amper, Politziner & Mattia, P.A.


Edison, New Jersey
August 22, 2002


                                      F-2
<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET AS OF JUNE 30, 2002

Assets:
   Current Assets:
      Cash and Cash Equivalents                                      $ 2,063,323
      Accounts Receivable - Net                                        2,272,425
      Deferred Income Taxes                                               52,000
      Inventories                                                      2,705,661
      Due From NuCycle Therapy, Inc. - Related Party                     100,282
      Prepaid Expenses and Other Current Assets                          117,832
                                                                     -----------

   Total Current Assets                                                7,311,523
                                                                     -----------

Property and Equipment - Net                                           2,307,527
                                                                     -----------

Other Assets:
   Deferred Tax Asset                                                    112,000
   Security Deposits and Other Assets                                    275,785
                                                                     -----------
      Total Other Assets                                                 387,785
                                                                     -----------

Total Assets                                                         $10,006,835
                                                                     ===========


See accompanying notes to consolidated financial statements.


                                      F-3

<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET AS OF JUNE 30, 2002

Liabilities and Stockholders' Equity:
Current Liabilities:
   Accounts Payable                                                $  1,632,112
   Notes Payable                                                          3,568
   Customer Advances                                                    550,971
   Accrued Expenses and Other Current Liabilities                       105,244
   Federal and State Income Taxes Payable                               106,262
   Capital Lease Obligation                                              13,802
                                                                   ------------

Total Current Liabilities                                             2,411,959
                                                                   ------------

Non-Current Liabilities:
   Capital Lease Obligation                                              10,101
                                                                   ------------
Total Non-Current Liabilities                                            10,101
                                                                   ------------

Commitments and Contingencies [11]

Stockholders' Equity:
   Preferred Stock - Authorized 1,000,000 Shares,                            --
   $.002 Par Value, No Shares Issued

   Common Stock - Authorized 25,000,000 Shares,                          12,457
   $.002 Par Value,  6228,720 Shares Issued and Outstanding
   Additional Paid-in-Capital                                         6,113,582

   Retained Earnings                                                  1,487,567
                                                                   ------------
                                                                      7,613,606
   Less, Treasury Stock at cost, 25,800 common shares                   (28,831)
                                                                   ------------

Total Stockholders' Equity                                            7,584,775
                                                                   ------------

Total Liabilities and Stockholders' Equity                         $ 10,006,835
                                                                   ============


See accompanying notes to consolidated financial statements.


                                      F-4

<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS

                                                       Years Ended June 30,
                                                       --------------------
                                                       2002            2001
                                                   ------------    ------------
Sales                                              $ 23,546,630    $ 15,293,090

Cost of Sales                                        18,842,688      13,820,829
                                                   ------------    ------------

Gross Profit                                          4,703,942       1,472,261

Selling and Administrative Expenses                   3,905,893       3,758,957
                                                   ------------    ------------

Operating Income [Loss]                                 798,049      (2,286,696)
                                                   ------------    ------------

Other Income [Expense]:

(Loss) on Sale of Equipment                                  --         (12,817)
Administrative Fee Income                               302,804         170,521
Administrative Fee Income-Related Party                      --          50,000
Partnership Income                                           --           8,765
Consulting Fee Income                                    48,000          20,000
Gain on Settlement of Lawsuit                         1,157,960          24,725
Interest Expense                                        (45,109)        (91,110)
Interest and Investment Income                           22,767          19,244
                                                   ------------    ------------

Total Other Income [Expense]                          1,486,422         189,328
                                                   ------------    ------------

Income [Loss] Before Income Taxes                     2,284,471      (2,097,368)

Federal and State Income Tax Expense [Benefit]          891,426        (647,465)
                                                   ------------    ------------

Net Income [Loss]                                  $  1,393,045    $ (1,449,903)
                                                   ============    ============

Net Income [Loss] Per Common Share:
Basic                                              $       0.22    $      (0.24)
                                                   ============    ============
Diluted                                            $       0.20    $      (0.24)
                                                   ============    ============

Average Common Shares Outstanding                     6,228,720       5,963,956

Warrants and Options, which are anti-dilutive           886,250              --
                                                   ------------    ------------

Average Common Shares
Outstanding-assuming dilution                         7,114,970       5,963,956
                                                   ============    ============


See accompanying notes to consolidated financial statements.


                                      F-5

<PAGE>


INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY FOR
THE YEARS ENDED JUNE 30, 2002 AND 2001

<TABLE>
<CAPTION>

                             Common Stock                      Additional                       Treasury Stock             Total
                             ------------        Preferred      Paid-In        Retained         --------------         Stockholders'
                        Shares      Par Value      Stock        Capital        Earnings        Shares       Cost           Equity
                        ------      ---------      -----        -------        --------        ------       ----           ------
<S>                    <C>           <C>         <C>           <C>            <C>              <C>          <C>            <C>
Balance-
July 1, 2000           5,178,300     $10,357     $      --     $4,847,405     $ 1,544,425      25,800     $(28,831)     $ 6,373,356


Common Stock
Issued for
Purchase of Land
and Building           1,050,420       2,100            --      1,247,900              --          --           --        1,250,000


Issuance  of Stock
Options                       --          --            --         18,277              --          --           --           18,277


Net (Loss)                    --          --            --             --      (1,449,903)         --           --       (1,449,903)
                       ---------     -------     ---------     ----------     -----------      ------     --------      -----------


Balance-
June 30, 2001          6,228,720      12,457            --      6,113,582          94,522      25,800      (28,831)       6,191,730


Net Income                    --          --            --             --       1,393,045          --           --        1,393,045
                       ---------     -------     ---------     ----------     -----------      ------     --------      -----------


Balance-
June 30, 2002          6,228,720     $12,457     $      --     $6,113,582     $ 1,487,567      25,800     $(28,831)     $ 7,584,775
                       =========     =======     =========     ==========     ===========      ======     ========      ===========
</TABLE>


See accompanying notes to consolidated financial statements.


                                      F-6

<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                            Years Ended June 30,
                                                            --------------------
                                                            2002            2001
                                                            ----            ----
<S>                                                      <C>            <C>
Operating Activities:                                    $ 1,393,045    $(1,449,903)
                                                         -----------    -----------
Net Income [Loss]
Adjustments to Reconcile Net Income [Loss] to Net Cash
      Provided By [Used for] Operating Activities:
      Depreciation and Amortization                          361,326        353,875
      Deferred Income Taxes                                  150,000        (34,000)
      Loss on Sale of Fixed Assets                                --         12,817
      Consulting Expense-Stock Options                            --         18,277
      Bad Debt Expense                                        81,159         40,428
 Changes in Assets and Liabilities:
[Increase] Decrease in:
     Accounts Receivable                                    (139,310)      (832,574)
     Inventories                                             893,184       (362,167)
     Refundable Federal Income Taxes                         625,000       (408,648)
     Due From NuCycle Therapy, Inc. - Related Party          (62,803)            --
     Prepaid Expenses and Other Current Assets                54,612        (62,304)
     Security Deposits and Other Assets                     (158,564)       (35,593)
 [Decrease] Increase in:
     Accounts Payable                                       (544,040)       819,518
     Federal and State Income Taxes Payable                  106,262             --
     Accrued Expenses and Other Liabilities                   11,905        422,859
                                                         -----------    -----------
Total Adjustments                                          1,378,731        (67,512)
                                                         -----------    -----------
Net Cash - Operating Activities - Forward                  2,771,776     (1,517,415)
                                                         -----------    -----------
Investing Activities:
   Proceeds From Sale of Fixed Assets                             --          9,500
   Loans to Stockholders                                     (68,746)        75,891
   Repayment of Note Receivable                              173,993             --
   Note Receivable                                          (141,050)       (35,000)
   Purchase of Property and Equipment                       (318,541       (109,457)
                                                         -----------    -----------
Net Cash-Investing Activities - Forward                     (354,344)       (59,066)
                                                         -----------    -----------
Financing Activities:
   Proceeds from Notes Payable                             3,975,245      2,564,471
   Repayment of Notes Payable                             (4,704,938     (2,435,415)
                                                         -----------    -----------
Net Cash-Financing Activities - Forward                     (729,693)       129,056
                                                         -----------    -----------
</TABLE>


See accompanying notes to consolidated financial statements.


                                       F-7
<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                         Years Ended June 30,
                                                         --------------------
                                                         2002           2001
                                                         ----           ----

Net Cash - Operating Activities - Forwarded            2,771,776     (1,517,415)

Net Cash - Investing Activities - Forwarded             (354,344)       (59,066)

Net Cash - Financing Activities - Forwarded             (729,693)       129,056
                                                      ----------    -----------

Net Increase/[Decrease] in Cash and Cash Equivalents   1,687,739     (1,447,425)

Cash and Cash Equivalents - Beginning of Year            375,584      1,823,009
                                                      ----------    -----------

Cash and Cash Equivalents - End of Year               $2,063,323    $   375,584
                                                      ==========    ===========


Supplemental Disclosures of Cash Flow Information:
    Cash paid during the years for:
      Interest                                        $   45,109    $    91,110
      Income Taxes                                       645,425         15,374


See accompanying notes to consolidated financial statements.


                                       F-8
<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

[1] Business

Integrated Health Technologies, Inc. [the "Company"] is engaged primarily in the
manufacturing, marketing and sales of vitamins, nutritional supplements and
herbal products. Its customers are located primarily throughout the United
States. The Company considers all subsidiaries as one segment of business.

[2] Summary of Significant Accounting Policies

Principles of Consolidation-The accompanying consolidated financial statements
include the accounts of the Company and its subsidiaries, all of which are
wholly-owned. Intercompany transactions and balances have been eliminated in
consolidation.

Fair Value of Financial Instruments

Generally accepted accounting principles require disclosing the fair value of
financial instruments to the extent practicable for financial instruments which
are recognized or unrecognized in the balance sheet. The fair value of the
financial instruments disclosed herein is not necessarily representative of the
amount that could be realized or settled, nor does the fair value amount
consider the tax consequences of realization or settlement.

In assessing the fair value of financial instruments, the Company uses a variety
of methods and assumptions, which are based on estimates of market conditions
and risks existing at the time. For certain instruments, including cash and cash
equivalents, accounts receivable, accounts payable, and accrued expenses, it was
estimated that the carrying amount approximated fair value because of the short
maturities of these instruments. All debt is based on current rates at which the
Company could borrow funds with similar remaining maturities and approximates
fair value.

Cash and Cash Equivalents- Cash equivalents are comprised of certain highly
liquid investments with a maturity of three months or less when purchased.

Inventories- Inventory is valued by the first-in, first-out method, at the lower
of cost or market.

Depreciation- The Company follows the general policy of depreciating the cost of
property and equipment over the following estimated useful lives:

Building                                                               15 Years
Leasehold Improvements                                                 15 Years
Machinery and Equipment                                                 7 Years
Machinery and Equipment Under Capital Leases                            7 Years
Transportation Equipment                                                5 Years


                                      F-9
<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #2

[2] Summary of Significant Accounting Policies [Continued]

Machinery and equipment are depreciated using accelerated methods while
leasehold improvements are amortized on a straight-line basis. Depreciation
expense was $361,326 and $353,875 for the years ended June 30, 2002 and 2001,
respectively. Amortization of equipment under capital leases is included with
depreciation expense.

Estimates- The preparation of financial statements in conformity with generally
accepted accounting principles 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 revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Revenue Recognition- The Company recognizes revenue upon shipment of the
product. All returns and allowances are estimated and recorded on a timely
basis.

Advertising- Costs incurred for producing and communicating advertising are
expensed when incurred. Advertising expense was $94,688 and $165,633 for the
years ended June 30, 2002 and 2001, respectively.

Stock-Based Compensation-Statement of Financial Accounting Standards 123
"Accounting for Stock Based Compensation" ("SFAS 123") allows a Company to adopt
a fair value based method of accounting for its stock-based compensation plans
or continue to follow the intrinsic value method of accounting prescribed by
Accounting Principles Board Opinion ("APB") No. 25, "Accounting for Stock Issued
to Employees". The Company accounts for stock-based compensation in accordance
with the provisions of Accounting Principles Board Opinion "APB") No. 25,
"Accounting for Stock Issued to Employees" and complies with the disclosure
provisions of SFAS No. 123, "Accounting for Stock-Based Compensation". Under APB
No. 25, compensation cost for stock options is measured as the excess, if any,
of the quoted market price of the Company's stock at the date of the grant over
the amount an employee must pay to acquire the stock.

[3] Inventories

Raw materials                                                        $1,075,093
Work-in-Process                                                         828,653
Finished Goods                                                          801,915
                                                                     ----------
Total                                                                $2,705,661
                                                                     ==========


[4] Property and Equipment

Land and Building                                                    $1,250,000
Leasehold Improvements                                                1,144,054
Machinery and Equipment                                               2,741,511
Machinery and Equipment Under Capital Leases                            156,561
Transportation Equipment                                                 32,152
                                                                     ----------
Total                                                                 5,324,278
Less: Accumulated Depreciation                                        3,016,751
                                                                     ----------
Total                                                                $2,307,527
                                                                     ==========


                                      F-10

<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #3

[5] Notes Payable

Merchant Financial Corporation (a)                                        $3,568
Less, Current Portion                                                      3,568
                                                                          ------

Non-current Portion                                                       $   --
                                                                          ======

(a) Under the terms of a revolving credit note which expires on December 21,
2003, the Company may borrow up to $1,000,000 at 4% above the prime lending
rate. The loan is collateralized by the inventory, receivables and equipment of
Integrated Health Technologies, Inc. and its operating subsidiaries. At June 30,
2002 the interest rate was 11%.

The loan agreement with Merchant Financial Corporation contains certain
financial covenants relating to the maintenance of tangible net worth as
defined. At June 30, 2002 the Company was in compliance with its tangible net
worth covenant.

[6] Capital Lease

The Company acquired warehouse and office equipment under the provisions of two
long-term leases. The leases expire in March 2003 and July 2003, respectively.
The equipment under the capital leases as of June 30, 2002 has a cost of $47,016
and accumulated depreciation of $16,934 with a net book value of $30,082.

The future minimum lease payments under capital leases and the net present value
of the future minimum lease payments at June 30, 2002 are as follows:

Total Minimum Lease Payments                                           $ 47,016
Amount Representing Interest                                            (23,113)
                                                                       --------

Present Value of Net Minimum Lease Payments                              23,903
Current Portion                                                         (13,802)
                                                                       --------

   Long-Term Capital Lease Obligation                                  $ 10,101
                                                                       ========

The following are maturities of long-term capital lease obligations:

June 30,
--------
2003                                                                     $13,802
2004                                                                       6,471
2005                                                                       3,630
                                                                         -------
Totals                                                                   $23,903
                                                                         =======


                                      F-11
<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #4

[7] Income Taxes

Deferred tax attributes resulting from differences between financial accounting
amounts and tax bases of assets and liabilities at June 30, 2002 follow:

Current assets and liabilities
   Allowance for doubtful account                                       $ 12,000
   Inventory overhead capitalization                                      40,000
                                                                        --------
   Net current deferred tax asset (liability)                           $ 52,000
                                                                        ========

Long-Term assets and liabilities
   Depreciation                                                         $112,000
                                                                        ========

The provision for income taxes consists of the following:

                                                              June 30,
                                                              --------
                                                       2002              2001
                                                       ----              ----

Deferred tax (benefit)                              $ 150,000         $ (34,000)
Current tax expense (benefit)                         741,426          (613,465)
                                                    ---------         ---------
                                                    $ 891,426         $(647,465)
                                                    =========         =========

The statutory income tax rate differs from the effective tax rate used in the
financial statements as a result of the permanent differences, change in
statutory tax rate and prior year net operating losses. A reconciliation of the
statutory tax rate to the effective tax rate for the year ended June 30 is as
follows:

                                                               2002       2001
                                                               ----       ----

Computed (benefit) provision at the statutory tax                34%       (34%)
State tax rate                                                    9         --
Other                                                            (4)         3
                                                                ---        ---
Effective income tax rate                                        39%       (31%)
                                                                ===        ===

[8] Profit-Sharing Plan

The Company maintains a profit-sharing plan, which qualifies under Section
401(k) of the Internal Revenue Code, covering all nonunion employees meeting age
and service requirements. Contributions are determined by matching a percentage
of employee contributions. The total expense for the years ended June 30, 2002
and 2001 was $77,138 and $59,631 respectively.


                                      F-12

<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #5

[9] Significant Risks and Uncertainties

[A] Concentrations of Credit Risk-Cash- The Company maintains balances at
several financial institutions. Accounts at each institution are insured by the
Federal Deposit Insurance Corporation up to $100,000. At June 30, 2002, the
Company's uninsured cash balances totaled approximately $1,530,000.

[B] Concentrations of Credit Risk-Receivables- The Company routinely assesses
the financial strength of its customers and, based upon factors surrounding the
credit risk of its customers, establishes an allowance for uncollectible
accounts and, as a consequence, believes that its accounts receivable credit
risk exposure beyond such allowances is limited. The Company does not require
collateral in relation to its trade accounts receivable credit risk. The amount
of the allowance for uncollectible accounts at June 30, 2002 is 29,460.

[10] Major Customer

For the years ended June 30, 2002 and 2001 approximately 43% or $10,125,000 and
28% or $4,300,000 of revenues were derived from one customer. The loss of this
customer would have an adverse affect on the Company's operations. In addition,
for the years ended June 30, 2002 and 2001, an aggregate of approximately 14%
and 32%, respectively, of revenues were derived from two other customers; no
other customers accounted for more than 10% of consolidated sales for the years
ended June 30, 2002 and 2001. Accounts receivable from these customers comprised
approximately 56% and 31% of total accounts receivable at June 30, 2002 and
2001, respectively.

[11] Commitments and Contingencies

[A] Leases

Related Party Leases- Certain manufacturing and office facilities were leased
from Morristown Holding Company, Inc., (formerly Gerob Realty Partnership) whose
owners are stockholders of the Company. The lease, which expired on December 31,
2000 provided for a minimum annual rental of $60,000, plus payment of all real
estate taxes. Rent and real estate tax expense for the years ended June 30, 2002
and 2001 on this lease was approximately $-0- and $5,000, respectively.

Other warehouse and office facilities are leased from Vitamin Realty Associates,
L.L.C., a limited liability company, which is 90% owned by the Company's
chairman and principal stockholder and certain family members and 10% owned by
the Company's Chief Financial Officer. The lease was effective on January 10,
1997 and provides for minimum annual rental of $346,000 through January 10, 2002
plus increases in real estate taxes and building operating expenses. Rent
expense has been straight-lined over the life of the lease. At its option, the
Company has the right to renew the lease for an additional five year period. On
April 28, 2000 the lease was amended reducing the square footage and extending
the lease to May 31, 2015 with annual rental of $323,559. Rent expense for the
years ended June 30, 2002 and 2001 on this lease was approximately $460,000 and
$455,000.

Other Lease Commitments- The Company leases warehouse equipment for a five year
period providing for an annual rental of $23,114 and office equipment for a five
year period providing for an annual rental of $8,365.

The Company leases automobiles under non-cancelable operating lease agreements,
which expire through 2004.


                                      F-13

<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #6

[11] Commitments and Contingencies [Continued]

The minimum rental commitment for long-term non-cancelable leases is as follows:


Year                                      Related
Ending                Lease               Party Lease
June 30,              Commitment          Commitment              Total
--------              ----------          ----------              -----

2003                   $ 84,250           $  323,559           $  407,809
2004                     51,582              323,559              375,141
2005                     19,063              323,559              342,622
2006                     15,194              323,559              338,753
2007                      4,914              323,559              328,473
Thereafter                   --            2,534,546            2,534,546
                       --------           ----------           ----------
Total                  $175,003           $4,152,341           $4,327,344
                       ========           ==========           ==========

Total rent expense, including real estate taxes and maintenance charges, was
approximately $530,000 and $523,000 for the years ended June 30, 2002 and 2001,
respectively. Rent expense is stated net of sublease income of approximately
$2,000 and $3,000 for the years ended June 30, 2002 and 2001, respectively.

[12] Development and Supply Agreement- On April 9, 1998, the Company signed a
development and supply agreement with Herbalife International of America, Inc.
["Herbalife"] whereby the Company will develop, manufacture and supply certain
nutritional products to Herbalife through December 31, 2002.

[13] Related Party Transactions

During the year ended June 30, 1997, the Company entered into a consulting
agreement with the brother of the Company's Chairman of the Board on a month to
month basis for $1,100 per month. The total consulting expense recorded per this
verbal agreement for the years ended June 30, 2002 and 2001 was $13,200 for each
year.

[14] Equity Transaction

[A] Stock Option Plan - The Company has adopted a stock option plan for the
granting of options to employees, officers, directors and consultants of the
Company to purchase up to 7,000,000 shares of common stock, at the discretion of
the Board of Directors. Stock option grants are limited to a total of 3,500,000
shares for "incentive stock options" and 3,500,000 shares for "non-statutory
options" and may not be priced less than the fair market value of the Company's
common stock at the date of grant. Options granted are generally for ten year
periods, except that options granted to a 10% stockholder [as defined] are
limited to five year terms.

On October 19, 2001 the Company granted 236,250 incentive stock options for a
term of ten years at an exercise price equal to the market price ($.075) on the
date of grant and 130,000 incentive stock options at an exercise price equal to
110% of the market price ($.0825).


                                      F-14
<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #7

[14] Equity Transaction [Continued]

The Company also granted 493,750 non-statutory stock options to officers,
directors and members of its Scientific Advisory Board at the exercise price of
$.075 and 270,000 non-statutory stock options at $.0825.

Pro forma information regarding net income and earnings per share has been
determined as if the Company had accounted for its employee's stock options
under the fair-value method. The fair value for these options was estimated at
the date of grant using a Black-Scholes option pricing model with the following
weighted-average assumptions for June 30:

                                           2002                         2001
                                           ----                         ----

Risk-free interest rate                    3.7%                         5.5%
Expected volatility                       95.3%                       137.3%
Dividend yield                              --                           --
Expected life                           7.5 years                   8.0 years

The Black-Scholes option valuation model was developed for use in estimating the
fair value of traded options, which have no vesting restrictions and are fully
transferable. In addition, option valuation models require the input of highly
subjective assumptions including the expected stock price volatility. Because
the Company's employee stock options have characteristics significantly
different from those of traded options, and because changes in the subjective
input assumptions can materially affect the fair-value estimate, in management's
opinion, the existing models do not necessarily provide a reliable single
measure of the fair value of its employee stock options.

For purposes of pro forma disclosures, the estimated fair value of the options
is amortized to expense over the options's life. The Company's pro forma
information is as follows:

                                                   2002                   2001
                                                   ----                   ----

Pro forma net income, (loss)                    $ 1,350,670        $ (1,965,129)
                                                ===========        =============

Pro forma net income, (loss) per share
Basic                                           $       .18        $       (.33)
                                                -----------        ------------
Diluted                                         $       .16        $       (.33)
                                                -----------        ------------

The Company recorded compensation expense for stock options issued in the amount
of $0 and $18,000 for the years ended June 30, 2002 and 2001.

                                      F-15


<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #8

[14] Equity Transactions [Continued]

A summary of the Company's stock option activity, and related information for
the years ended June 30, follows:

<TABLE>
<CAPTION>
                                                     Weighted Average           Number of      Weighted Average
                                        Options       Exercise Price          Exercisable       Exercise Price
                                        -------       --------------          -----------       --------------
<S>                                   <C>                  <C>                  <C>                  <C>
Outstanding June 30, 2000             2,515,175            1.36                   925,175            2.82

Granted                               1,319,000            0.88
Exercised                                    --             --
Terminated                              (20,000)           0.50
                                      ---------

Outstanding June 30, 2001             3,814,175            1.20                 2,495,175            1.36

Granted                               1,130,000            0.88
Exercised                                    --             --
Terminated                              (98,974)           0.50
                                      ---------

Outstanding June 30, 2002             4,845,201            0.92                 3,715,201            1.18
                                      =========                                 =========

<CAPTION>
Weighted-average fair value of  options granted during the year                      2002                  2001
                                                                                     ----                  ----
<S>                                                                                  <C>                   <C>
Where exercise price equals stock price                                                --                  0.81
Where exercise price exceeds stock price                                             1.28                  1.03
Where stock price exceeds exercise price                                              .78                    --
</TABLE>

Following is a summary of the status of stock options outstanding at June 30,
2002:

<TABLE>
<CAPTION>
                                         Outstanding Options                                         Exercisable Options
                                         -------------------                                         -------------------
                                          Weighted Average            Weighted                            Weighted
  Exercise                                   Remaining                Average                             Average
 Price Range           Number             Contractual Life         Exercise Price      Number          Exercise Price
 -----------           ------             ----------------         --------------      ------          --------------
<S>                 <C>                         <C>                    <C>          <C>                    <C>
$  .05 -  .08       1,130,000                   8.7                    0.08                 0                 0
$  .50 -  .55       1,560,000                   6.8                    0.52         1,560,000              0.52
$  .75 -  .83         957,000                   7.9                    0.78           957,000              0.78
$ 1.00 - 1.10         275,000                   6.6                    1.03           275,000              1.03
$ 1.50 - 1.65         320,604                   5.4                    1.53           320,604              1.53
$ 1.75                 25,000                   3.0                    1.75            25,000              1.75
$ 3.50 - 3.85         577,597                   3.9                    3.48           577,597              3.48
-------------       ---------                   ---                    ----         ---------              ----
$ 0.05 - 3.85       4,845,201                   8.3                    1.03         3,715,201              1.18
</TABLE>

There were no warrants exercised for the fiscal years ended June 30, 2002 and
2001.


                                      F-16
<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #9

[14] Equity Transactions [Continued]

[B] Consultant Agreement/Stock Options- In connection with a consulting
agreement dated March 20, 1998, the Company has issued three options for 45,000
shares of common stock. Each option is exercisable for 15,000 shares at exercise
price of $1.125, $2.50 and $4.00, respectively. These options are exercisable
until five years following the date of this agreement.

[C] Related Party Promissory Note- On March 12, 1998, the Company negotiated a
three year promissory note for $750,000 with its Chairman and then President.
The note was repaid in January 2000. As consideration for the loan, the
Corporation issued a Class C Warrant to purchase 150,000 shares of common stock
at the aggregate purchase price of $1.75 per share. The warrant is exercisable
for a four year period commencing one year after the issuance of the note and
expires on March 12, 2003.

[D] Tender Offer- On March 5, 2001 the Company entered into an Agreement and
plan of Reorganization with NuCycle Therapy, Inc. ("NuCycle") whereby Chem
Acquisition Corp., (a wholly-owned subsidiary) will acquire NuCycle Therapy,
Inc. and NuCycle Therapy, Inc. will become a wholly-owned subsidiary of the
Company. On May 21, 2001 the original agreement was amended and restated to
provide that Chem Acquisition Corp. will make a tender offer for all of the
outstanding common stock of NuCycle Therapy, Inc. and all outstanding warrants.
The total consideration offered will be $400,000. The tender offer was accepted
on July 11, 2001 and resulted in Chem Acquisition Corp. acquiring 2,298,309
shares of NuCycle common stock which represented approximately 72% of NuCycle.
On August 29, 2001 NuCycle Therapy, Inc. held a special meeting of stockholders
and approved the Amended and Restated Agreement and Plan of Reorganization

The Company, in September 2001, then entered into a Licensing Agreement with
NuCycle whereby the Company obtained the exclusive license to manufacture,
market and sell vitamin and mineral supplements using NuCycle's technology.

In September 2001 the Company then sold NuCycle to certain investors for the
same $400,000 to recoup the Company's investment. Certain of the investors are
also shareholders and officers of the Company. NuCycle desired to pursue the
development of drugs and pharmaceuticals with its technology and the Company did
not want to fund such development.

As of June 30, 2002, the Company had advanced $100,282 to Nucycle Therapy,
Inc.for operating expenses.

[15] New Accounting Pronouncement

In July 2001, FAS No. 141, "Business Combinations" (FAS 141") and FAS No. 142
"Goodwill and Other Intangible Assets" (FAS 142") were issued. FAS 141 requires
that the purchase method of accounting be used for all business combinations
initiated after June 30, 2001. FAS 141 also specifies the criteria that
intangible assets acquired in a purchase method business combination must meet
to be recognized and reported apart from goodwill. FAS 142 requires that
goodwill and intangible assets with indefinite useful lives no longer be
amortized, but instead be tested for impairment, at least annually, in
accordance with the provisions of FAS 142.
FAS 142 will also require that intangible assets with definite useful lives be
amortized over their respective estimated useful lives to their estimated
residual values, and be reviewed for impairment in accordance with FAS No. 121,
"Accounting for the Impairment of Long-lived Assets and Long-lived Assets to be
Disposed of". The provisions of FAS 141 are effective immediately, except with
regard to business combinations prior to July 1, 2001. FAS 142 will be effective
as of July 1, 2002. Goodwill and other intangible assets acquired in business
combinations completed before July 1, 2001, will continue to be amortized prior
to the adoption of FAS 142. The


                                      F-17
<PAGE>

INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Sheet #10

[15] New Accounting Pronouncement  [Continued]

Company does not anticipate that this statement will have a material impact on
its financial position and results of operations.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be disposed of." SFAS No. 144
establishes a single accounting model for long-lived assets to be disposed of by
sale and requires that those long-lived assets be measured at the lower of
carrying amount of fair value less cost to sell, whether reported in continuing
operations or in discontinued operations. SFAS No. 144 is effective for fiscal
years beginning after December 15, 2001. The Company does not anticipate that
this statement will have a material impact on its financial position and results
of operations.


                                      F-18

<PAGE>

                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.


                           INTEGRATED HEALTH TECHNOLOGIES, INC. AND SUBSIDIARIES


Date: September 9, 2002                By: /s/ Seymour Flug
                                           -------------------------------------
                                           Seymour Flug,
                                           President and Chief Executive Officer

Date: September 9, 2002                By: /s/ Eric Friedman
                                           -------------------------------------
                                           Eric Friedman,
                                           Chief Financial Officer


                                      F-19

<PAGE>

                              Certification of CFO

I, Eric Friedman, certify that:

1.    I have reviewed this annual report on Form 10-KSB of Integrated Health
      Technologies, Inc.;

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

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

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

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

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

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

5.    The registrant's other certifying officers and I have disclosed, based on
      our most recent evaluation, to the registrant's auditors and the audit
      committee of registrant's board of directors (or persons performing the
      equivalent function):

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

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

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


Date: September 9, 2002                By: /s/ Eric Friedman
                                           -------------------------------------
                                       Name: Eric Friedman,
                                       Title: Vice President & Chief Financial
                                              Officer


                                      F-20
<PAGE>

                              Certification of CEO

I, Seymour Flug, certify that:

7.    I have reviewed this annual report on Form 10-KSB of Integrated Health
      Technologies, Inc.;

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

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

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

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

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

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

11.   The registrant's other certifying officers and I have disclosed, based on
      our most recent evaluation, to the registrant's auditors and the audit
      committee of registrant's board of directors (or persons performing the
      equivalent function):

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

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

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


Date: September 9, 2002               By: /s/ Seymour Flug
                                          -------------------------------------
                                      Name: Seymour Flug
                                      Title: President & Chief Executive Officer


                                      F-21