**AMENDMENT
      TO LOAN AND SECURITY AGREEMENT**


**AND
      WAIVER OF DEFAULTS**




THIS
      AMENDMENT TO LOAN AND SECURITY AGREEMENT AND WAVIER OF DEFAULTS (this
“Amendment”), dated as of February __, 2008, is entered into by and among
      Nutrition 21, Inc., a New York corporation, Nutrition 21, LLC, a New York
      limited liability company, Iceland Health, LLC a New York limited liability
      company (each a “Borrower” and collectively, “Borrowers”) and Gerber Finance
      Inc. (“Lender”).




RECITALS




Borrowers
      and Lender are parties to a Loan and Security Agreement dated June 30, 2007
      (as
      amended from time to time, the “Loan Agreement”).




Borrower
      has requested that certain amendments be made to the Loan Agreement and that
      Lender waive certain Events of Default arising under the Loan Agreement, which
      Lender is willing to make and do pursuant to the terms and conditions set forth
      herein.




NOW,
      THEREFORE, in consideration of the premises and of the mutual covenants and
      agreements herein contained, it is agreed as follows:




1.  Definitions .
      Capitalized terms used in this Amendment have the meanings given to them in
      the
      Loan Agreement unless otherwise specified.




2.  Amendments. Upon the
      terms and subject to the conditions set forth in this Amendment, the Loan
      Agreement is hereby amended as follows:




(a)  The
      following defined term in Section 1(a) is amended to provide as
      follows:




“ Maximum
      Revolving Amount ”
means
      Two Million Dollars ($2,000,000).




(b)  The
      following defined terms are inserted in the appropriate alphabetical order
      in
      Section 1(a):




“ EBITDA ”
means,
      with respect to any Person, for any period (a) the Net Income (Loss) of such
      Person for such period plus (b) the sum of, in each case to the extent included
      in the calculation of such Net Income (Loss) but without duplication, (i) any
      provision for income taxes or other taxes measured by net income, (ii) interest
      expense, amortization of debt discount and commissions and other fees and
      charges associated with indebtedness, (iii) any loss from extraordinary items,
      (iv) any depreciation, depletion and amortization expense, (v) any aggregate
      net
      loss on the sale of property outside the ordinary course of business and (vi)
      any other non-cash expenditure, charge or loss for such period and minus (c)
      the
      sum of, in each case to the extent included in the calculation of such Net
      Income (Loss) and without duplication, (i) any credit for income taxes or other
      taxes measured by net income, (ii) any interest income, (iii) any gain from
      extraordinary items and any other non-recurring gain, (iv) any aggregate net
      gain from the sale of property out of the ordinary course of business by such
      Person and (v) any other non-cash gain.







“ Iceland
      Health Direct Response ”
means
      the division of Iceland Health, LLC known as Iceland Health Direct
      Response.




“ Net
      Income (Loss) ”
means,
      with respect to any Person, for any period, the consolidated net income (loss)
      after all expenses and taxes of such Person for such period.




(c)  Section
      13 is amended to provide as follows




“13.  Financial
      Covenants .




(a)  Borrowers
      and their Subsidiaries shall not at any time permit their Tangible Net Worth
      on
      a consolidated to be less negative than ($8,200,000).




(b)  The
      consolidated liabilities of Borrowers and their subsidiaries at the end of
      each
      month shall not exceed two times the net worth of Borrowers and their
      Subsidiaries on a consolidated basis.




(c)  Iceland
      Health Direct Response shall achieve gross revenues of at least $5,000,000
      for
      each fiscal quarter.




(d)  Borrower
      and its Subsidiaries shall not incur a Net Loss in any fiscal quarter commencing
      with the fiscal quarter ending September 30, 2008 and each fiscal quarter end
      thereafter.




(e)  Borrowers
      and their Subsidiaries on a consolidated basis shall achieve EBITDA of at least
      $1,250,000 for the fiscal quarter ending June 30, 2008.”




3.  No
      Other Changes .
      Except
      as explicitly amended by this Amendment, all of the terms and conditions of
      the
      Loan Agreement shall remain in full force and effect.




4.  Waiver
      of Defaults .
      Upon
      the terms and subject to the conditions set forth in this Amendment, Lender
      hereby waives the Events of Default arising solely from (a) the failure of
      Borrowers to maintain a Tangible Net Worth of at least ($5,000,000) for the
      periods ending on and prior to December 31, 2007 and (b) Borrowers having a
      loss
      greater than $3,000,000 for the six month period ending December 31, 2007.
      This
      foregoing waiver shall be effective only in this specific instance and for
      the
      specific purpose for which it is given, and this waiver shall not entitle any
      Borrower to any other or further waiver in any similar or other
      circumstances.




2


5.  Amendment
      Fee .
      Borrowers shall pay Lender as of the date hereof a fully earned, non-refundable
      fee in the amount of $60,000 in consideration of Lender’s execution and delivery
      of this Amendment.




6.  Conditions
      Precedent .
      This
      Amendment, and the waiver set forth in Paragraph 4 hereof. shall be effective
      when Lender shall have received an executed original hereof, together with
      each
      of the following, each in substance and form acceptable to Lender in its sole
      discretion:




(a)  A
      Certificate of the Secretary of each Borrower certifying as to (i) the
      resolutions of the board of directors of each Borrower approving the execution
      and delivery of this Amendment, (ii) the fact that the articles of incorporation
      or formation and bylaws or operating agreement of each Borrower, which were
      certified and delivered to Lender pursuant to the Secretarial Certificate of
      each Borrower’s secretary or assistant secretary dated June 30, 2007 continue in
      full force and effect and have not been amended or otherwise modified except
      as
      set forth in the Certificate to be delivered, and (iii) certifying that the
      officers and agents of each Borrower who have been certified to Lender, pursuant
      to the Secretarial Certificate of each Borrower’s secretary or assistant
      secretary dated June 30, 2007, as being authorized to sign and to act on behalf
      of each Borrower continue to be so authorized or setting forth the sample
      signatures of each of the officers and agents of each Borrower authorized to
      execute and deliver this Amendment and all other documents, agreements and
      certificates on behalf of each Borrower;




(b)  Payment
      of the fee described in Paragraph 5 of this Amendment; and




(c)  Receipt
      by Lender in Lender’s account of $1,000,000 in cash to be held as collateral
      security for the Obligations in accordance with Section 7 of this
      Amendment.




7.  Post
      Amendment Items .
      On the
      date of this Amendment, Borrowers shall have deposited with Lender as cash
      collateral for the Obligations cash in the amount of $1,000,000. Borrowers
      hereby grant Lender a Lien in such cash to be held as security for the
      Obligations. No later than February 15, 2008, Borrowers shall deliver to Lender
      (a) evidence that Borrowers have established a Deposit Account owned by a
      Borrower (the “Pledged Account”), which Pledged Account shall be free and clean
      of all Liens except those in favor of Lender, (b) Borrowers shall have
      instructed Lender to deposit the $1,000,000 in cash collateral into such Deposit
      Account and (c) each of the following documents, in form and substance
      satisfactory to Lender, duly executed by all parties thereto: (i) an agreement
      among Borrowers, Lender and the financial institution which maintains the
      Pledged Account effective to grant “control” (as defined under the applicable
      UCC) over Pledged Account to Lender; (ii) a pledge agreement executed by the
      applicable Borrowers pursuant to which Lender is granted a Lien on the Pledged
      Account to secure the Obligations. Each Borrower acknowledges and agrees that
      its failure to satisfy the requirements set forth in this paragraph 7 within
      the
      applicable time limit shall, in each event, constitute an Event of Default
      under
      the Loan Agreement.




3


8.  Representations
      and Warranties .
      Each
      Borrower hereby represents and warrants to Lender as follows:




(a)  Such
      Borrower has all requisite power and authority to execute this Amendment and
      any
      other agreements or instruments required hereunder and to perform all of its
      obligations hereunder, and this Amendment and all such other agreements and
      instruments has been duly executed and delivered by such Borrower and constitute
      the legal, valid and binding obligation of Borrower, enforceable in accordance
      with its terms.




(b)  The
      execution, delivery and performance by such Borrower of this Amendment and
      any
      other agreements or instruments required hereunder have been duly authorized
      by
      all necessary corporate action and do not (i) require any authorization, consent
      or approval by any governmental department, commission, board, bureau, agency
      or
      instrumentality, domestic or foreign, (ii) violate any provision of any law,
      rule or regulation or of any order, writ, injunction or decree presently in
      effect, having applicability to such Borrower, or the articles of incorporation
      or formation or by-laws or operating agreement of such Borrower, or (iii) result
      in a breach of or constitute a default under any indenture or loan or credit
      agreement or any other agreement, lease or instrument to which such Borrower
      is
      a party or by which it or its properties may be bound or affected.




(c)  All
      of
      the representations and warranties contained in the Loan Agreement are correct
      on and as of the date hereof as though made on and as of such date, except
      to
      the extent that such representations and warranties relate solely to an earlier
      date.




9.  References .
      All
      references in the Loan Agreement to “this Agreement” shall be deemed to refer to
      the Loan Agreement as amended hereby; and any and all references in the
      Ancillary Agreement to the Loan Agreement shall be deemed to refer to the Loan
      Agreement as amended hereby.




10.  No
      Other Waiver .
      Except
      as otherwise provided in Paragraph 4 hereof, the execution of this Amendment
      and
      the acceptance of all other agreements and instruments related hereto shall
      not
      be deemed to be a waiver of any Default or Event of Default under the Loan
      Agreement or a waiver of any breach, default or event of default under any
      Ancillary Agreement, whether or not known to Lender and whether or not existing
      on the date of this Amendment.




11.  Release .
      Each
      Borrower hereby absolutely and unconditionally releases and forever discharges
      Lender, and any and all participants, parent corporations, subsidiary
      corporations, affiliated corporations, insurers, indemnitors, successors and
      assigns thereof, together with all of the present and former directors,
      officers, agents and employees of any of the foregoing, from any and all claims,
      demands or causes of action of any kind, nature or description, whether arising
      in law or equity or upon contract or tort or under any state or federal law
      or
      otherwise, which such Borrower has had, now has or has made claim to have
      against any such person for or by reason of any act, omission, matter, cause
      or
      thing whatsoever arising from the beginning of time to and including the date
      of
      this Amendment, whether such claims, demands and causes of action are matured
      or
      unmatured or known or unknown.




4


12.  Costs
      and Expenses .
      Each
      Borrower hereby reaffirms its agreement under the Loan Agreement to pay or
      reimburse Lender on demand for all costs and expenses incurred by Lender in
      connection with the Loan Agreement and the Ancillary Agreements, including
      without limitation all reasonable fees and disbursements of legal counsel.
      Without limiting the generality of the foregoing, Borrowers, jointly and
      severally, specifically agree to pay all fees and disbursements of counsel
      to
      Lender for the services performed by such counsel in connection with the
      preparation of this Amendment and the documents and instruments incidental
      hereto. Each Borrower hereby agrees that Lender may, at any time or from time
      to
      time in its sole discretion and without further authorization by Borrower,
      make
      a loan to Borrower under the Loan Agreement, or apply the proceeds of any loan,
      for the purpose of paying any such fees, disbursements, costs and
      expenses **** and
      the
      fee required under Paragraph 5 of this Amendment.




13.  Governing
      Law. This
      Amendment shall be binding upon and inure to the benefit of the parties hereto
      and their respective successors and assigns and shall be governed by and
      construed in accordance with the laws of the State of New York.




14.  Headings .
      Section
      headings in this Amendment are included herein for convenience of reference
      only
      and shall not constitute a part of this Amendment for any other
      purpose.




15.  Counterparts;
      Facsimile .
      This
      Amendment may be executed by the parties hereto in one or more counterparts,
      each of which shall be deemed an original and all of which when taken together
      shall constitute one and the same agreement. Any signature delivered by a party
      by facsimile transmission shall be deemed to be an original signature
      hereto.







5




IN
      WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
      executed as of the date first above written.




**GERBER
                FINANCE INC.**
            **NUTRITION
                21, INC.**By:
              
              Name:
              Title:
            By:
              
              Name:
              Title:**NUTRITION
                21, LLC**
            **ICELAND
                HEALTH, LLC**By:
              
              Name:
              Title:
            By:
              
              Name:
              Title: