SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549
                             ----------------------

                                   FORM 10-QSB

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
                                  Act of 1934

                  For the quarterly period ended March 31, 2001

          [ ] Transition Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934.

             For the  transition   period  from  ________  to  ___________
                       Commission file number: 333-14477

                                SPORTSNUTS, INC.
                               ---------------------
        (Exact name of small business issuer as specified in its charter)
<TABLE>
<S>                                                      <C>

     Delaware                                            87-0561426
     --------                                            ----------

     (State or other jurisdiction of                     (IRS Employer
      incorporation or organization)                     Identification No.)

     The Towers at South Towne II,   Suite 550,
     10421 South 400 West,
     Salt Lake City, UT                                  84094
     ------------------                                  ----------------
   (Address of principal executive offices)              Zip Code
</TABLE>

                                (801) 816-2500 )
                                --------------
                           Issuer's telephone number )

                       SPORTSNUTS.COM INTERNATIONAL, INC. )
                       -----------------------------------
  (Former name or former address and former fiscal year, if change since last
report.)

                                        2

<PAGE>


                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

                   PROCEEDINGS DURING THE PRECEDING FIVE YEARS

     Check whether the registrant  has filed all documents and reports  required
to be filed by Sections  12, 13, or 15(d) of the  Exchange Act of 1934 after the
distribution of securities under a plan confirmed by a court. Yes [ ] No [ ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. As of March 31, 2001, the Company had
outstanding 5,239,301 shares of common stock, par value $0.002 per share.

Transitional Small Business Disclosure Format (check one)  [ ] Yes [x ] No







                                        3

<PAGE>



                                     PART I

                              FINANCIAL INFORMATION

The Financial Statements of the Company are prepared as of March 31, 2001.

ITEM 1.  FINANCIAL STATEMENTS REQUIRED BY FORM 10-QSB

                                    CONTENTS

<TABLE>
<S>                                                                          <C>
Consolidated Balance Sheets.................................................. 2

Consolidated Statements of Operations........................................ 4

Consolidated Statements of Stockholders' Equity (Deficit).................... 5

Consolidated Statements of Cash Flows........................................ 6

Notes to the Consolidated Financial Statements............................... 9
</TABLE>

                                        1

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                           Consolidated Balance Sheets


                                     ASSETS

<TABLE>
<CAPTION>
                                            March 31,          December 31,
                                              2001               2000
                                        ----------------      ---------------
                                         (Unaudited)
<S>                                      <C>                   <C>
CURRENT ASSETS

   Cash and cash equivalents (Note 1)    $       12,130        $           651
   Accounts receivable, net (Note 1)              7,062                  7,361
   Inventory, net (Notes 1 and 2)                 8,935                 11,650
   Prepaid expenses                              12,439                 27,917
                                        ---------------        ---------------

     Total Current Assets                        40,566                 47,579
                                        ---------------        ---------------

PROPERTY AND EQUIPMENT (Note 1)

   Computer hardware                            518,789                518,789
   Computer software                            721,809                721,809
   Furniture and office equipment               189,019                189,019
   Less - accumulated depreciation             (764,113)              (652,429)
                                        ---------------        ----------------
     Total Property and Equipment               665,504                777,188
                                        ---------------        ----------------

     TOTAL ASSETS                       $       706,070        $       824,767
                                        ===============        ===============
</TABLE>


            See the accompanying notes to the consolidated financial
                                   statements.


                                        2

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                     Consolidated Balance Sheets (Continued)


                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
                 ----------------------------------------------
<TABLE>
<CAPTION>
                                                                               March 31,            December 31,
                                                                                  2001                  2000
                                                                           ------------------   -----------------
                                                                             (Unaudited)
<S>                                                                        <C>                 <C>
CURRENT LIABILITIES

   Accounts payable                                                        $        1,200,013  $       1,197,146
   Accrued expenses                                                                   536,268            465,647
   Notes payable, current portion (Note 4)                                            155,000            155,000
   Notes payable, related parties (Note 3)                                            482,000            489,500
                                                                             ----------------  -----------------

     Total Current Liabilities                                                      2,373,281          2,307,293
                                                                             ----------------  -----------------

STOCKHOLDERS' EQUITY (DEFICIT)

   Preferred stock, $0.002 par value; 20,000,000 shares
    authorized, 178,000 shares issued and outstanding                                     356                356
   Common stock, $0.002 par value; 200,000,000 shares
    authorized, 5,239,301 and 3,397,095 shares issued
    and outstanding, respectively                                                      10,479              6,794
   Stock subscription receivable                                                       (1,600)            -
   Additional paid-in capital                                                      18,037,001         17,708,296
   Accumulated deficit prior to the development stage                             (13,139,071)       (13,139,071)
   Accumulated deficit since the inception of the
    development stage                                                              (6,574,376)        (6,058,901)
                                                                             ----------------    ---------------

     Total Stockholders' Equity (Deficit)                                          (1,667,211)        (1,482,526)
                                                                             ----------------    ---------------

     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
       (DEFICIT)                                                           $          706,070  $         824,767
                                                                           ==================  =================
</TABLE>
           See the accompanying notes to the consolidated financial
                                  statements.

                                        3

<PAGE>

                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                      Consolidated Statements of Operations
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                                      From
                                                                                                 Inception of the
                                                                                                    Development
                                                                                                     Stage on
                                                                                                   March 1, 2000
                                                                 For the Three Month                  Through
                                                                      March 31,                      March 31,
                                                       ---------------------------------------
                                                               2001                    2000             2001
                                                       ------------------  -------------------    --------------
<S>                                                    <C>                 <C>                     <C>
NET SALES                                              $               -   $                -      $           -
                                                       ------------------  -------------------    --------------
EXPENSES
   General and administrative                                     254,165           1,041,172          5,417,029
   Selling and marketing                                          195,520             187,435            774,318
   Research and development                                        46,149              63,995            260,200
                                                       -------------------    ----------------   ---------------
       Total Expenses                                             495,834           1,292,602         6,451,547
                                                       ------------------     ---------------     --------------

LOSS FROM OPERATIONS                                            (495,834)         (1,292,602)        (6,451,547)
                                                       ------------------     --------------     ---------------
OTHER INCOME (EXPENSES)
   Interest expense                                              (26,839)            (10,451)          (136,346)
   Interest income                                                   101               1,271              1,397
   Other income                                                    5,300              -                  13,050
   Gain on forgiveness of debt                                     1,797              -                  35,623
   Loss on sale of assets                                          -                  -                 (36,553)
                                                       ------------------     --------------       ------------

     Total Other Income (Expenses)                               (19,641)             (9,180)          (122,829)
                                                       -----------------      --------------       ------------
LOSS FROM CONTINUING OPERATIONS
 BEFORE INCOME TAXES                                            (515,475)         (1,301,782)        (6,574,376)

INCOME TAX EXPENSE                                                  -                   -                  -
                                                       ------------------     ---------------      -------------

LOSS FROM CONTINUING OPERATIONS                                 (515,475)         (1,301,782)        (6,574,376)

LOSS FROM DISCONTINUED
OPERATIONS (Note 10)                                                                 (546,577)             -
                                                       ------------------     ---------------     --------------

NET LOSS                                               $        (515,475)     $    (1,848,359)  $    (6,574,376)
                                                       =================      ===============    ==============

BASIC LOSS PER COMMON SHARE -
 BASIC AND DILUTED (Note 1)
   Loss from continuing operations                     $           (0.11)    $         (1.42)
   Loss from discontinued operations                                -                  (0.59)
                                                       ------------------     ---------------
     Basic Loss Per Share                              $           (0.11)              (2.01)
                                                       ==================     ===============

WEIGHTED AVERAGE NUMBER OF COMMON
 SHARES OUTSTANDING                                            4,630,550             919,918
                                                       =================     ===============
</TABLE>

            See the accompanying notes to the consolidated financial
                                  statements.
                                        4

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
            Consolidated Statements of Stockholders' Equity (Deficit)
<TABLE>
<CAPTION>

                                                                                    Additional
                                                                                    Paid-In
                                     Preferred Stock          Common Stock          Capital
                                     ---------------------    ------------------    ------------
                                     Shares     Amount        Shares   Amount
                                     ------     ----------    -------  ---------
<S>                                  <C>        <C>           <C>       <C>         <C>
Balance, December 31, 1999                 -    $        -    894,918   $ 1,790     $ 12,494,031

Issuance of common stock for cash
(net of issuance costs of $15,000)         -             -    927,383     1,855          458,146

Warrants issued below market value         -           -            -         -        3,592,418

Preferred shares issued for cash     178,000         356            -         -          394,644

Stock offering costs                       -           -            -         -          (19,500)

Shares issued for services                 -           -      945,800     1,892          720,035

Shares issued for debt payment             -           -      504,200     1,008           50,771

Shares issued for exercise of stock
options                                    -           -       50,000       100            7,900

Shares issued for exercise of warrants
                                           -           -       74,794       149            9,851
Net loss for the year ended December
31, 2000                                   -           -            -        -                 -

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

Balance, December 31, 2000           178,000         356    3,397,095     6,794       17,708,296

Issuance of common stock for cash
(unaudited)                                -           -      500,000     1,000           49,000

Warrants issued below market value
(unaudited)                                -           -            -         -           77,940

Shares issued for services (unaudited)     -           -      350,000       700           75,950

Shares issued for exercise of stock
options (unaudited)                        -           -       80,000       160           12,640

Shares issued for exercise of warrants
for cash (unaudited)                       -           -      712,206     1,425           63,575

Shares issued for exercise of warrants
for services rendered (unaudited)          -           -      200,000       400           49,600

Net loss for the three months end
March 31, 2001 (unaudited)                 -           -            -          -              -
                                    --------  ----------  ----------   --------   -------------

Balance, March 31, 2001 (unaudited)  178,000  $      356    5,239,301   $10,479  $  18,037,001
                                    -=======  ==========  ============   =======  =============
</TABLE>

            See the accompanying notes to the consolidated financial
                                  statements.

                                      5

<PAGE>

                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
            Consolidated Statements of Stockholders' Equity (Deficit)
                                  (continued)
<TABLE>
<CAPTION>
                                                          Stock         Total
                                         Accumulated      Subscription  Stockkholders
                                         Deficit          Receivable    Equity (Deficit)
                                         -----------      -----------   ----------------
<S>                                   <C>                 <C>           <C>
Balance, December 31, 1999            $ (11,940,918)      $     -       $   554,903

Issuance of common stock for cash
(net of issuance costs of $15,000)6               -             -           460,001

Warrants issued below market value8               -             -         3,592,418

Preferred shares issued for cash                  -             -           395,000

Stock offering costs                              -             -           (19,500)

Shares issued for services                        -             -           721,927

Shares issued for debt payment                    -             -            51,779

Shares issued for exercise of stock
options                                           -             -             8,000

Shares issued for exercise of warrants            -             -            10,000

Net loss for the year ended December
December 31, 2000   -                    (7,257,054)            -        (7,257,054)

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

Balance, December 31, 2000              (19,197,972)            -        (1,482,526)

Issuance of common stock for cash
(unaudited)                                      -              -            50,000

Warrants issued below market value
(unaudited)                                      -              -            77,940

Shares issued for services (unaudited)           -              -            76,650

Shares issued for exercise of stock
options (unaudited)                              -          (1,600)          11,200

Shares issued for exercise of warrants
for cash (unaudited)                             -              -            65,000

Shares issued for exercise of warrants
for services rendered (unaudited                 -              -            50,000

Net loss for the three months end
March 31, 2001 (unaudited)                (515,475)             -          (515,475)
                                     -------------      -------------    ----------

Balance, March 31, 2001 (unaudited)  $ (19,713,447)     $      (1,6$0)  $(1,667,211)

</TABLE>

            See the accompanying notes to the consolidated financial
                                  statements.


                                        6

<PAGE>



<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                      Consolidated Statements of Cash Flows
                                   (Unaudited)
<TABLE>
<CAPTION>


                                                                                                                   From
                                                                                                             Inception of the
                                                                                                               Development
                                                                                                                 Stage on
                                                                                                              March 1, 2000
                                                                For the Three Months Ended                       Through
                                                                         March 31,                              March 31,
                                                                -------------------------------------
                                                                          2001               2000                  2001
                                                                ------------------- -----------------   -------------------
<S>                                                             <C>                 <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:

   Net loss                                                     $         (515,475) $      (1,848,359)  $      (6,574,376)
   Adjustments to reconcile net loss to net
    cash used in operating activities:
     Depreciation                                                          111,684            118,502             496,472
     Common stock issued for services                                       76,650             -                  798,577
     Warrants issued below market value                                     77,940            732,125           3,385,196
     Loss on sale of fixed assets                                           -                  -                   36,553
     Gain on forgiveness of debt                                            (1,797)            -                  (35,623)
     Warrants exercised for services                                        50,000             -                   50,000
     Options exercised for services                                          3,342             -                    3,342

   Changes in operating assets and liabilities:
     Accounts receivable                                                       299             (7,090)             14,530
     Inventory                                                               2,715              2,480              12,521
     Restricted cash                                                        -                  -                  110,000
     Other current assets                                                   15,478           (108,068)            125,967
     Accounts payable                                                       10,922            382,166             108,566
     Accrued expenses                                                       72,221            (82,992)            328,514
                                                                ------------------  -----------------   -----------------

       Net Cash Used in Operating Activities                               (96,021)          (736,238)         (1,139,761)
                                                                ------------------  -----------------   -----------------

CASH FLOWS FROM INVESTING ACTIVITIES:

   Proceeds from sale of fixed assets                                       -                  -                   79,714
   Purchases of property and equipment                                      -                (139,817)            (36,014)
                                                                ------------------  -----------------   -----------------

       Net Cash Provided (Used) in
       Investing Activities                                                 -                (139,817)            43,700
                                                                ------------------  -----------------  ------------------

</TABLE>



            See the accompanying notes to the consolidated financial
                                  statements.


                                        7

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                Consolidated Statements of Cash Flows (Continued)
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                                                From
                                                                                                          Inception of the
                                                                                                             Development
                                                                                                             Stage on
                                                                                                            March 1, 2000
                                                                For the Three Months Ended                     Through
                                                                          March 31,                          March 31,
                                                                ---------------------------------------
                                                                        2001                2000                   2001
                                                                ------------------- ------------------- -----------------------
<S>                                                             <C>                 <C>                 <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from issuance of notes payable                                  -                 575,000             277,000
   Proceeds from issuance of common stock                                   50,000            250,000             293,009
   Proceeds from issuance of preferred stock                                -                  -                  395,000
   Proceeds from exercise of stock warrants                                 65,000             -                   65,000
   Stock offering costs                                                     -                 (15,000)            (19,500)
   Principal payments of notes payable                                      (7,500)           (33,000)            (20,000)
                                                                ------------------- -----------------   -----------------

       Net Cash Provided by Financing Activities                $          107,500  $         777,000   $         990,509
                                                                ------------------  -----------------   -----------------

NET INCREASE (DECREASE) IN CASH AND
 CASH EQUIVALENTS                                               $           11,479  $         (99,055)  $        (105,552)

CASH AND CASH EQUIVALENTS AT
 BEGINNING OF PERIOD                                                           651            148,647             117,682
                                                                ------------------  -----------------   -----------------

CASH AND CASH EQUIVALENTS AT END
 OF PERIOD                                                      $           12,130 $           49,592   $         12,130
                                                                =================== ==================  =================

SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid for:

   Interest                                                     $               37  $           494     $          3,058
   Income taxes                                                 $           -       $          -        $         -

Non-Cash Investing and Financing Activities:

   Common stock issued for services                             $           76,650  $          -        $        798,577

   Common stock issued to convert notes
   payable and interest                                         $           -       $          -        $         41,771

   Equipment exchanged for reduction of
   accounts payable                                             $           -       $          -        $          7,626

   Common stock issued for reduction of
   accounts payable                                             $           -       $          -        $         10,000

</TABLE>

            See the accompanying notes to the consolidated financial
                                  statements.


                                        8

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                Consolidated Statements of Cash Flows (Continued)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                                                From
                                                                                                          Inception of the
                                                                                                             Development
                                                                                                               Stage on
                                                                                                            March 1, 2000
                                                                For the Three Months Ended                    Through
                                                                         March 31,                            March 31,
                                                                ---------------------------------------
                                                                        2001                2000                  2001
                                                                ------------------- ------------------- -----------------------
<S>                                                             <C>                 <C>                 <C>
SUPPLEMENTAL CASH FLOW INFORMATION (continued)

   Common stock issued for warrants exercised
   through services rendered                                    $           50,000  $          -        $          50,000

   Common stock issued for options exercised
   through services rendered                                    $            3,342  $          -        $           3,342

   Common stock issued for options exercised
   by conversion of accounts payable and
   other liabilities                                            $            7,858  $          -        $           7,858

   Common stock issued for options exercised
   for stock subscription receivable                            $            1,600  $          -        $           1,600

</TABLE>

            See the accompanying notes to the consolidated financial
                                  statements.


                                        9

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 1 -      ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

              a. Organization and Description of Business

              SportsNuts,  Inc. (formerly  SportsNuts.com  International,  Inc.)
              (the  "Company") was  incorporated  under the laws of the State of
              Delaware on July 12, 1996.  On April 15, 2001 the Company  changed
              its name from  SportsNuts.com  International,  Inc. to SportsNuts,
              Inc.  Prior  to  the  reorganization  with  SportsNuts.com,   Inc.
              ("SportsNuts"), a privately held Delaware corporation, on April 6,
              1999, the Company had not commenced active business operations and
              was considered a development stage company.  On March 1, 2000, the
              Company  reentered the development  stage when it discontinued the
              operations of its direct sales division (see Note 10).

              On April 6, 1999,  the  Company  acquired  (the  "Reorganization")
              approximately  eighty-one percent (81%) of the outstanding capital
              stock of SportsNuts,  a privately held company. The Reorganization
              was accounted for as a reverse merger into a non-operating  public
              company,   wherein   SportsNuts  was  treated  as  the  accounting
              acquirer.  In  conjunction  with the  Reorganization,  the Company
              changed   its  name   from   Durwood,   Inc.   to   SportsNuts.com
              International, Inc. and effected a 2.213 for 1 forward stock split
              of all the  outstanding  shares  of its  common  stock on April 6,
              1999.  All  references  to common  stock  have been  retroactively
              restated.

              On June 25, 2000, the Company effected a 1-for-20 reverse split of
              all outstanding  shares of Common and Preferred Stock, and amended
              and restated its Certificate of  Incorporation  to restate its par
              value at $0.002 per Common and Preferred  share. All references to
              shares   outstanding  and  other  equity   instruments  have  been
              retroactively restated.

              SportsNuts was  incorporated  in the state of Utah on November 13,
              1996 and began operations on January 1, 1997. Its primary business
              involved  the  sales  and   distribution  of  sporting  goods  and
              health/nutritional  products, using the Internet, through a direct
              sales distribution strategy. The strategy also included creating a
              personalized  sports community offering a comprehensive  bundle of
              sports,  outdoors  and  fitness-related  products,   services  and
              information  in a club  environment  on its web site.  The  direct
              sales distributor force sold club memberships with access to these
              products and services on the Web Site.

              This  business  strategy had  continued  since its  inception  and
              subsequent  to the  Reorganization  until March 1, 2000,  when the
              Company determined to discontinue its direct sales operations (see
              Note 10).

              On July 28, 1999,  the Company  issued 47,244 shares of its common
              stock to certain shareholders of Sportzz.com,  Inc. ("Sportzz") in
              exchange for all of the issued and  outstanding  shares of Sportzz
              common stock. In addition, cash consideration of $100,000 was paid
              as part of the acquisition. The acquisition was accounted for as a
              purchase per APB No. 16.

              Sportzz  was  incorporated  in the State of Utah on April 7, 1999.
              Immediately  prior  to the  merger,  Sportzz  was  engaged  in the
              development of Internet based database  management and application
              development  software,  and it  maintained  an  Internet  web site
              employing its products for purposes of inputting,  searching,  and
              retrieving  amateur  sports  information  from  leagues,  schools,
              teams,  and their player rosters,  game  schedules,  game results,
              photographs, articles, and statistics.

                                       10

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 1 -      ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

              b. Accounting Method

              The Company's consolidated financial statements are prepared using
              the  accrual  method of  accounting.  The  Company  has  elected a
              December 31 year end.

              c. Cash and Cash Equivalents

              Cash Equivalents  include  short-term,  highly liquid  investments
              with   maturities   of  three  months  or  less  at  the  time  of
              acquisition.

              d. Inventory

              Inventory is stated at the lower of cost  (computed on a first-in,
              first-out  basis) or  market.  The  inventory  cost  includes  all
              expenses necessary to place the inventory in a saleable condition.

              e. Property and Equipment

              Property  and  equipment  are  stated  at cost.  Expenditures  for
              ordinary  maintenance  and repairs are  charged to  operations  as
              incurred.   Major  additions  and  improvements  are  capitalized.
              Depreciation is computed using the  straight-line  and accelerated
              methods over estimated useful lives as follows:
<TABLE>
<S>                                                 <C>
                            Computer hardware       3 years
                            Computer software       3 years
                            Office equipment        7 years
</TABLE>


              Depreciation expense for the three months ended March 31, 2001 and
              2000 was $111,684 and $118,502 respectively.

              f. Accounts Receivable

              Accounts receivable are recorded net of the allowance for doubtful
              accounts of $24,922 as of March 31, 2001 and December 31, 2000.

              g. Revenue Recognition

              Substantially all of the Company's sales are on a cash-for-service
              basis.  Occasionally,  sales are made on  account  for the sale of
              promotional merchandise.  Revenue is recognized upon completion of
              the service or upon delivery of the goods.

              h. 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.

                                       11

<PAGE>

                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 1 -      ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

              i. Advertising

              The  Company   follows  the  policy  of  charging   the  costs  of
              advertising to expense as incurred.

              j. Basic Loss Per Share
<TABLE>
<CAPTION>
                                                                                For the Three Months Ended
                                                                                        March 31,
                                                                         ----------------------------------------
                                                                             2001                 2000
                                                                         ------------------    ------------------
<S>                                                                      <C>                  <C>
              Basic loss per share from continuing operations:

                     Loss (numerator)                                    $        (515,475)    $      (1,301,782)
                     Shares (denominator)                                        4,630,550               919,918
                     Per share amount                                    $           (0.11)    $           (1.42)

              Basic loss per share from discontinued operations:

                     Loss (numerator)                                    $          -          $        (546,577)
                     Shares (denominator)                                           -                    919,918
                     Per share amount                                    $          -          $           (0.59)
</TABLE>


              The basic loss per share of common  stock is based on the weighted
              average number of shares issued and outstanding  during the period
              of the  financial  statements.  Common  shares to be  issued  from
              preferred  stock,  warrants,  and options are not  included in the
              computation  because they would have an antidilutive effect on the
              net loss per common share.

              k.  Provision for Taxes

              The Company  accounts  for income  taxes under the  provisions  of
              Statement  of  Financial  Accounting  Standards  (SFAS)  No.  109,
              Accounting  for Income  Taxes,  using the  liability  method.  The
              estimated  future tax effect of  differences  between the basis in
              assets  and  liabilities  for  tax  and  accounting   purposes  is
              accounted for as deferred taxes. In accordance with the provisions
              of SFAS No. 109, a valuation  allowance  would be  established  to
              reduce  deferred  tax assets if it were more  likely than not that
              all, or some  portion,  of such  deferred  tax assets would not be
              realized.  A  full  allowance  against  deferred  tax  assets  was
              provided as of March 31, 2001.

              At  March  31,   2001,   the  Company  had  net   operating   loss
              carryforwards  of  approximately  $11,500,000  that may be  offset
              against  future  taxable income through 2020. No tax benefits have
              been reported in the financial  statements,  because the potential
              tax benefits of the net operating  loss carry  forwards are offset
              by a valuation allowance of the same amount.

              Due to the change in ownership provisions of the Tax Reform Act of
              1986,  net operating  loss  carryforwards  for Federal  income tax
              reporting  purposes  are subject to annual  limitations.  Should a
              change in ownership occur, net operating loss carryforwards may be
              limited as to use in the future.


                                       12

<PAGE>

                                 SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 1 -      ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Continued)

              l. Research and Development

              The  Company   follows  the  policy  of  charging   research  and
              development costs to expense as incurred.

              m.  Stock Options and Warrants

              As permitted by FASB  Statement  123  "Accounting  for Stock Based
              Compensation"  (SFAS No. 123), the Company  elected to measure and
              record  compensation  cost relative to employee stock option costs
              in accordance with Accounting Principles Board ("APB") Opinion 25,
              "Accounting   for  Stock   Issued  to   Employees,"   and  related
              interpretations  and  make pro  forma  disclosures  of net  income
              (loss)  and basic  earnings  (loss) per share as if the fair value
              method  of  valuing  stock  options  had been  applied.  Under APB
              Opinion 25,  compensation  cost is  recognized  for stock  options
              granted to employees when the option price is less than the market
              price of the underlying  common stock on the date of grant.  As of
              March 31, 2001,  there were 2,115,000  options  outstanding  which
              were granted to  employees,  all of which were granted at exercise
              prices equal to or above the market price on the grant date.

              For  purposes  of the pro forma  disclosures  and to  measure  and
              record  consideration  paid to non- employees in the form of stock
              options or  warrants,  the Company  applies  FASB  Statement  123,
              "Accounting for Stock-Based  Compensation" ("SFAS No. 123"), which
              requires the Company to estimate  the fair value of each  dilutive
              instrument (stock options and warrants) award at the grant date by
              using the Black-Scholes option pricing model.

              n.  Unaudited Consolidated Financial Statements

              The accompanying unaudited financial statements include all of the
              adjustments,  which,  in the opinion of management,  are necessary
              for  a  fair  presentation.  Such  adjustements  are  of a  normal
              recurring nature.


NOTE 2 -      INVENTORY

              Inventory consisted of the following:
<TABLE>
<CAPTION>
                                                                               March 31,           December 31,
                                                                                  2001                  2000
                                                                         --------------------- ----------------------
                                                                              (Unaudited)
<S>                                                                      <C>                   <C>


              Finished goods                                             $          12,818     $          15,533
              Reserve for obsolete inventory                                        (3,883)               (3,883)
                                                                         --------------------  --------------------

                        Total                                            $           8,935     $          11,650
                                                                         ====================  ===================
</TABLE>


                                          13

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 3 - NOTES PAYABLE - RELATED PARTIES

              Notes payable - related parties consisted of the following:
<TABLE>
<CAPTION>

                                                                                        March 31,             December 31,
                                                                                         2001                     2000
                                                                                    ------------------  -------------------
                                                                                        (Unaudited)
<S>                                                                                 <C>                 <C>
              Note payable to a shareholder,  secured by tangible and intangible
               assets of the Company,  interest at 16%,  principal  and interest
               due April 1, 2000. Note is convertible into common
               stock of the Company at $.10 per share.                            $         450,000     $         450,000

              Notes payable to related individuals, unsecured,
               interest at 10%, due on demand.                                               27,000                27,000

              Notes payable to related individuals, unsecured,
               interest at 12%, due on demand.                                                5,000                12,500
                                                                                  ------------------     ----------------

                         Total notes payable - related parties                              482,000               489,500

                          Less: current portion                                            (482,000)             (489,500)
                                                                                  -----------------      ----------------

                          Long-term notes payable                                 $               -      $             -
                                                                                  =================      ===============

</TABLE>

              Maturities of notes payable - related parties are as follows:
<TABLE>
<CAPTION>

                      Year Ending
                         March 31,                                                                  Amount
              ----------------------------------                                               -----------------
<S>                                                                                            <C>
                         2002                                                                  $          482,000
                                                                                               ------------------

                         Total                                                                 $          482,000
                                                                                               ==================
</TABLE>

NOTE 4 - NOTES PAYABLE

              Notes payable consisted of the following:
<TABLE>
<CAPTION>
                                                                                        March 31,            December 31,
                                                                                          2001                   2000
                                                                                    ----------------     ---------------------
                                                                                       (Unaudited)

<S>                                                                               <C>                    <C>

              Note payable to a related  individual,  secured by tangible assets
               of the Company,  interest at 16%,  principal and interest due May
               1, 2000. Note is convertible into common stock of the
               Company at $1.00 per share.                                         $          20,000     $          20,000
</TABLE>


                                                        14

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 4 - NOTES PAYABLE (Continued)

<TABLE>
<S>                                                                                <C>                   <C>

              Note payable to a related  individual,  secured by tangible assets
               of the Company,  interest at 16%,  principal and interest due May
               4, 2000. Note is convertible into common stock of the
               Company at $1.00 per share.                                                  20,000                20,000

              Note  payable  to  an  individual,  unsecured,  interest  at  10%,
               principal  and interest due June 26,  2000.  Note is  convertible
               into common stock of the Company at $1.00
               per share.                                                                   50,000                50,000

              Note  payable  to  an  individual,  unsecured,  interest  at  18%,
               principal and interest due August 15, 2001.  Note is  convertible
               into common stock of the Company at $0.25
               per share.                                                                   50,000                50,000

              Note payable to an individual, unsecured,
               interest at 16%, due on demand.                                              15,000                15,000
                                                                                  ----------------       ---------------

                         Total notes payable                                               155,000               155,000

                          Less: current portion                                           (155,000)            (155,000)
                                                                                  ----------------       --------------

                          Long-term notes payable                                 $             -        $           -
                                                                                  ================       ==============
</TABLE>


              Maturities of notes payable are as follows:
<TABLE>
<CAPTION>
                     Year Ending
                       March 31,                                                                     Amount
              --------------------------                                                       -----------------
<S>                                                                                            <C>

                           2002                                                                $          155,000
                                                                                               ------------------

                          Total                                                                $          155,000
                                                                                               ==================

</TABLE>

NOTE 5 -      COMMON AND PREFERRED STOCK TRANSACTIONS

              Effective  January 1, 2000,  the Company  issued  25,000 shares of
              common stock at a price of $10.00 per share.

              Effective  April 10, 2000,  the Company  issued  50,000  shares of
              nonvoting  convertible  preferred  stock at a price  of $2.26  per
              share,  together with warrants to acquire 250,000 shares of common
              stock at an  exercise  price of $2.00  per  share.  Each  share of
              preferred  stock is  convertible  into two (2)  shares  of  common
              stock.

                                       15

<PAGE>



                                SPORTSNUTS, INC.
                 (Formerly SportsNuts.com International, Inc.)
                         (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 5 -      COMMON AND PREFERRED STOCK TRANSACTIONS (Continued)

              Effective  May 1,  2000,  the  Company  issued  128,000  shares of
              nonvoting  convertible  preferred  stock at a price  of $2.20  per
              share,  together with warrants to acquire 725,000 shares of common
              stock at an  exercise  price of $2.00  per  share.  Each  share of
              preferred  stock is  convertible  into two (2)  shares  of  common
              stock.

              Effective May 2, 2000,  the Company issued 15,000 shares of common
              stock valued at $2.50 per share in  satisfaction  of an obligation
              for consulting services received by the Company.

              Effective July 5, 2000, the Company issued 50,000 shares of common
              stock valued at  approximately  $0.63 per share in satisfaction of
              obligations for consulting services received by the Company.

              Effective  July 15, 2000,  the Company  issued  200,000  shares of
              common   stock  valued  at   approximately   $0.41  per  share  in
              satisfaction  of obligations for consulting  services  received by
              the Company.

              Effective  August 15 through  September 28, 2000, the Company sold
              and  issued   1,402,383  shares  of  its  Common  Stock  to  seven
              accredited investors.

              Effective  September 1, 2000,  the Company issued 20,000 shares of
              common  stock  valued  at  $0.75  per  share  in  satisfaction  of
              obligations for consulting services received by the Company.

              Effective  October 1, 2000,  the Company  issued 100,000 shares of
              common  stock  valued  at  $1.25  per  share  in  satisfaction  of
              obligations for consulting services received by the Company.

              Effective  October 5, 2000,  the Company  issued 100,000 shares of
              common   stock  valued  at   approximately   $1.16  per  share  in
              satisfaction  of obligations for consulting  services  received by
              the Company.

              Effective  November 6, 2000,  the Company  issued 15,000 shares of
              common   stock  valued  at   approximately   $2.39  per  share  in
              satisfaction of obligations for public relations services received
              by the Company.

              Effective  November 20, 2000, the Company issued 450,000 shares of
              common  stock valued at  approximately  $0.63 in  satisfaction  of
              obligations for consulting services received by the Company.


              Effective  December 19, 2000,  the Company issued 74,794 shares of
              common stock at a price of approximately $0.13 in exchange for the
              exercise of warrants held by certain individuals.

              Effective  December 29, 2000,  the Company issued 50,000 shares of
              common  stock at a price of $0.16 in exchange  for the exercise of
              stock options held by certain employees of the Company.

                                       16

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 5 -      COMMON AND PREFERRED STOCK TRANSACTIONS (Continued)

              Effective  January 2, 2001,  the Company  issued 350,000 shares of
              common  stock  valued  at  $0.219  per  share in  satisfaction  of
              obligations for public relations services received by the Company.

              Effective  January 3, 2001,  the Company  issued 300,000 shares of
              common  stock at a price of  approximately  $0.083 in exchange for
              the exercise of warrants held by certain individuals.

              Effective  January 8, 2001,  the Company  issued  80,000 shares of
              common  stock at a price of $0.16 in exchange  for the exercise of
              stock  options held by certain  employees and  consultants  of the
              Company.

              Effective  January 12, 2001,  the Company  issued 37,402 shares of
              common stock at a price of  approximately  $0.1337 in exchange for
              the exercise of warrants held by certain individuals.

              Effective  February 2, 2001,  the Company issued 300,000 shares of
              common  stock at a price of  approximately  $0.083 in exchange for
              the exercise of warrants held by certain individuals.

              Effective  February 15, 2001,  the Company issued 74,804 shares of
              common stock at a price of  approximately  $0.1337 in exchange for
              the exercise of warrants held by certain individuals.

              Effective  February 21, 2001,  the Company sold and issued 500,000
              shares of its Common Stock at a price of $0.10 per share.

              Effective  March 14, 2001,  the Company  issued  200,000 shares of
              common  stock at a price of $0.25 in exchange  for the exercise of
              warrants held by certain individuals.


NOTE 6 -      OPTIONS AND WARRANTS

              Options

              The following  tables  summarize the  information  regarding stock
options at March 31, 2001:
<TABLE>
<S>                                                                                             <C>
                      Options outstanding at December 31, 2000                                           2,195,000
                      Options exercised                                                                   (80,000)
                                                                                                -----------------
                      Options outstanding at March 31, 2001                                              2,115,000
                                                                                                ==================
</TABLE>

<TABLE>
<CAPTION>
                                     Number of         Weighted                        Number of
                                     Options           Average          Weighted       Options           Weighted
                                    Outstanding       Remaining         Average       Exercisable at     Average
                    Exercise         March 31,       Contractual       Exercise        March 31,        Exercise
                       Price          2001            Life             Price            2001             Price
              -----------------  ----------------  --------------  ---------------  ----------------   ------------
<S>           <C>                    <C>                    <C>    <C>                      <C>        <C>

              $            0.16         2,115,000            4.33  $          0.16           414,000   $       0.16

</TABLE>

                                       17

<PAGE>



                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 6 -      OPTIONS AND WARRANTS (Continued)

              The Company applies APB Opinion 25 and related  Interpretations in
              accounting for its plan.  Accordingly,  no  compensation  cost has
              been recognized for its stock option plan. Had  compensation  cost
              for the Company's  stock-based  compensation  plan been determined
              based on the fair value at the grant  dates for awards  under such
              plan consistent with the method of FASB Statement 123, "Accounting
              for  Stock-Based  Compensation"  (SFAS No. 123), the Company's net
              loss and basic loss per common share would have been  unchanged as
              indicated below:
<TABLE>
<CAPTION>
                                                                            March 31,
                                                              -----------------------------------------
                                                                       2001                  2000
                                                              -------------------    ---------------------
<S>                                                           <C>                    <C>
              Net loss as reported                            $        (515,475)     $    (1,848,359)
              Pro forma net loss                                       (515,475)          (1,848,359)
              Basic loss per share as reported                            (0.11)               (2.01)
              Pro forma basic loss per share                              (0.11)               (2.01)
</TABLE>


              The Company  estimates  the fair value of each stock option at the
              grant date and re-valuation date by using the Black-Scholes option
              pricing model based on the following assumptions:

<TABLE>
<S>                                                                                   <C>
                      Risk free interest rate                                         5.06% - 6.12%
                      Expected life                                                       4-5 Years
                      Expected volatility                                               2.18 - 2.33
                      Dividend yield                                                            0.0
</TABLE>

              Warrants

              During the  quarter  ended  March 31,  2001,  the  Company  issued
              warrants to acquire 825,000 shares of common stock. These warrants
              were issued at exercise prices ranging from $0.072 to $0.152.  All
              warrants  issued  were  to  non-employees  of  the  Company.   The
              following  tables  summarize the  information  regarding  warrants
              outstanding at March 31, 2001. All the warrants are exercisable at
              March 31, 2001.
<TABLE>
<S>                                                                                  <C>
                      Warrants outstanding at December 31, 2000                           2,047,558
                      Warrants granted                                                      825,000
                      Warrants exercised                                                   (912,206)
                                                                                    ---------------
                      Warrants outstanding at March 31, 2001                              1,960,352
                                                                                    ==================

                      Weighted average exercise price of warrants
                        outstanding at March 31, 2001                               $          1.34
                                                                                    ===============
</TABLE>



                                         18

<PAGE>

                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 6 -      OPTIONS AND WARRANTS (Continued)

<TABLE>
<CAPTION>
                                                              Number of           Weighted
                                                              Warrants            Average             Weighted
                                                            Outstanding at        Remaining           Average
                                                              March 31,         Contractual          Exercise
                      Range of Exercise Prices                2001               Life                Price
                      ------------------------          ------------------  ------------------  ------------------
<S>                   <C>                                      <C>                     <C>      <C>

                      $0.072 - $0.40                               713,000                0.64  $             0.22
                      $0.75 - $1.00                                185,167                2.65  $             0.77
                      $2.00                                      1,040,000                3.05  $             2.00
                      $15.20 - $40.00                               22,185                0.17  $            23.27
</TABLE>

              The  Company  applies  SFAS No.  123 for  warrants  issued,  which
              requires  the Company to estimate  the fair value of each  warrant
              issued at the grant date by using the Black-Scholes  pricing model
              with the following assumptions:
<TABLE>
<S>                                                                                                  <C>
                      Risk-free interest rate                                                        4.45% - 6.68%
                      Expected life                                                                  1 - 36 Months
                      Expected volatility                                                              1.04 - 2.92
                      Dividend yield                                                                           0.0
</TABLE>

              As a result of applying  SFAS No. 123,  the Company had an expense
              of $77,940 and  $732,125  during the three  months ended March 31,
              2001 and  2000,  respectively.  The  expense  is  included  in the
              general and administrative amount in the statement of operations.

NOTE 7 -       OPERATING LEASES

              The  Company  leases two (2)  different  office  facilities  under
              non-cancelable  operating leases expiring in 2004.  Rental expense
              for the three months ended March 31, 2001 and 2000 was $33,766 and
              $30,324, respectively.

              The Company also has operating leases on certain office equipment.
              Office  equipment  leases  are  generally  for a term  of 48 to 60
              months.  Lease  expense was $1,783 and $2,056 for the three months
              ended March 31, 2001 and 2000, respectively.

              Future minimum lease payments, by year and in the aggregate, under
              the  non-cancelable  operating  leases with  initial or  remaining
              terms of one year or more are due as follows:

<TABLE>
<CAPTION>

               Year Ending
              December 31,                                                                              Amount
              ------------                                                                      ------------------
<S>                                                                                             <C>
              2001                                                                              $          135,934
              2002                                                                                         136,852
              2003                                                                                         133,648
              2004                                                                                          54,729
              2005 and thereafter                                                                             -
                                                                                                ------------------

                   Total minimum lease payments                                                 $          461,163
                                                                                                ==================
</TABLE>

                                       19


<PAGE>

                                SPORTSNUTS, INC.
                  (Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 8 -      GOING CONCERN

              The accompanying  financial statements have been prepared assuming
              that  the  Company  will  continue  as  a  going  concern,   which
              contemplates   the  realization  of  assets  and  satisfaction  of
              liabilities  in the normal  course of  business.  The  Company has
              sustained  significant  net  losses  which  have  resulted  in  an
              accumulated   deficit  at  December  31,  2000  of   approximately
              $19,200,000 and has experienced  periodic cash flow  difficulties,
              all of which  raise  substantial  doubt  regarding  the  Company's
              ability to continue as a going concern.

              The net loss for the three  months  ended  March 31, 2001 and 2000
              was $515,475 and $1,848,359, respectively. To date the Company has
              funded its operations through a combination of short and long-term
              loans and the private  placement of its common stock.  The Company
              anticipates  another net loss for the year ended December 31, 2001
              and with the expected cash requirements for the coming year, there
              is  substantial  doubt as to the  Company's  ability  to  continue
              operations.

              The Company  believes  these  conditions  have  resulted  from the
              inherent risks  associated with small startup  technology-oriented
              companies. Such risks include, but are not limited to, the ability
              to (i) generate revenues and sales of its products and services at
              levels  sufficient  to cover its costs  and  provide a return  for
              investors,  (ii)  attract  additional  capital in order to finance
              growth,  (iii) further develop and successfully  market commercial
              products and services,  and (iv)  successfully  compete with other
              comparable  companies having  financial,  production and marketing
              resources significantly greater than those of the Company.

              The Company is attempting  to improve  these  conditions by way of
              financial assistance through issuances of additional equity and by
              generating revenues through sales of products and services.


NOTE 9 -      RELATED PARTY TRANSACTIONS

              Effective  February  1,  2000,  the  Company  sold  and  issued  a
              promissory note secured by certain tangible and intangible  assets
              of the Company ("GMI Note") to the Gardner Management, Inc. Profit
              Sharing Plan and Trust, a principal shareholder of the Company, in
              exchange for $450,000 in cash proceeds.  As of August 1, 2000, the
              principal  amount of the GMI Note is  convertible  into  4,500,000
              shares of Common Stock.  On March 31, 2000,  the Company filed the
              GMI Note with the Securities and Exchange Commission as an Exhibit
              to the  Company's  annual report on Form 10-KSB for the year ended
              December 31, 1999.

              Effective  July 15,  2000,  the  Company  entered  into a one-year
              consulting agreement with Eslie Barlow, a principal shareholder of
              the  Company,   to  receive  strategic   consulting  and  advisory
              services. The Company issued 200,000 shares of common stock to Mr.
              Barlow in connection with this Agreement.

              Effective  August 7, 2000,  the  Company  sold  500,000  shares of
              common  stock to Eslie  Barlow,  a  principal  shareholder  of the
              Company, at a price of $.10 per share.


                                       20

<PAGE>


                                SPORTSNUTS, INC.
                  Formerly SportsNuts.com International, Inc.)
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                      March 31, 2001 and December 31, 2000

NOTE 9 -      RELATED PARTY TRANSACTIONS (Continued)

              Effective  August 7, 2000,  the Company  issued  500,000 shares of
              common  stock to Eslie  Barlow,  a  principal  shareholder  of the
              Company,  in satisfaction of notes payable and interest due to Mr.
              Barlow valued at approximately $.10 per share.

NOTE 10 -     DISCONTINUED OPERATIONS

              Effective  March 1, 2000, the Company  elected to discontinue  its
              direct  sales  operations  and  concentrate  solely on building an
              Internet  portal to the amateur sports market.  The following is a
              summary of the loss from  discontinued  operations  resulting from
              the  elimination  of the direct sales segment of the Company.  The
              financial  statements have been retroactively  restated to reflect
              this event.

<TABLE>
<CAPTION>

                                                                                 For the Three Months
                                                                                    Ended March 31,
                                                                         ---------------------------------------
                                                                                    2001           2000
                                                                         -------------------   -----------------
                                                                               (Unaudited)
<S>                                                                      <C>                   <C>

              NET SALES                                                  $                -    $          41,188
                                                                         ------------------    -----------------
              OPERATING EXPENSES
                Cost of sales                                                             -               34,136
                General and administrative                                                -              277,990
                Selling and marketing                                                     -              225,932
                Research and development                                                  -               50,421
                                                                         -------------------   -----------------
                   Total Operating Expenses                                               -              588,479
                                                                         -------------------   -----------------

              LOSS FROM OPERATIONS                                                        -             (547,291)
                                                                         -------------------   -----------------
              OTHER INCOME (EXPENSES)
                Interest expense                                                          -                 (257)
                Interest income                                                           -                  971
                                                                         -------------------   -----------------
                  Total Other Income (Expense)                                            -                  714
                                                                         -------------------   -----------------

              LOSS BEFORE INCOME TAX (EXPENSE)                                            -             (546,577)
              INCOME TAX (EXPENSE)                                                        -                    -
                                                                         -------------------   ------------------
              LOSS FROM DISCONTINUED OPERATIONS                          $                -    $        (546,577)
                                                                         ===================   =================
</TABLE>

NOTE 11 -     SUBSEQUENT EVENT

              Effective  April 15,  2001,  the Company  signed an  agreement  to
              aquire Rocky Mountain Sports  Alliance,  Inc.  ("RMSA"),  a sports
              management  firm  located  in  Salt  Lake  City,  Utah.  The  RMSA
              currently holds the rights to a number of sports events throughout
              Utah and the surrounding intermountain area. The Company exchanged
              3,800,000  shares of its  common  stock for all of the  issued and
              outstanding  shares of RMSA. The acquisition will be accounted for
              as a purchase  per APB No. 16 and RMSA will become a wholly  owned
              subsidiary of the Company.




                                       21

<PAGE>

item 2.     NANAGEMEN'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONN AND
            RESULTS OF OPERATIONS

         The  following  discussion  of the  financial  condition and results of
operations of SportsNuts, Inc. (hereafter, "SportsNuts" or the "Company") should
be read in conjunction with the Unaudited Financial Statements and related Notes
thereto included herein. This discussion may contain forward-looking  statements
within the meaning of Section 27A of the  Securities Act of 1933 and Section 21E
of  the  Securities  Exchange  Act  of  1934,  including,   without  limitation,
statements regarding the Company's expectations,  beliefs, intentions, or future
strategies that are signified by the words "expects,"  "anticipates," "intends,"
"believes," or similar  language.  Actual results could differ  materially  from
those projected in the forward looking statements.  Prospective investors should
carefully  consider  the  information  set forth below  under the caption  "Risk
Factors" in  addition to the other  information  set forth  herein.  The Company
cautions  investors  that its business and financial  performance  is subject to
substantial risks and uncertainties.

Overview

         Historically,  SportsNuts  had  been  an  online,  personalized  sports
community   offering   a   comprehensive   bundle  of  sports,   outdoors,   and
fitness-related products,  services, and information in a club environment.  The
Company had attempted to combine the three forces of sports,  the Internet,  and
direct  sales in an effort to build a targeted  online  customer  base of sports
enthusiasts.  Virtually all of the revenues generated in the past two years have
been generated in connection with the Company's  direct sales  operations.  With
the discontinuation of its direct sales operations on March 1, 2000, the Company
has since focused solely on becoming a technology and marketing  resource to the
amateur  sports  market.  In connection  with this change in focus,  the Company
anticipates  generating future revenues primarily from the following six sources
(i)  online  registration/administration   service  fees,  (ii)  amateur  sports
organization  fundraising  and  sponsorships,  (iii) website  advertising,  (iv)
e-commerce  commissions,  (v) website hosting,  and (vi) sports event management
fees.  Therefore,  future  sources of revenue are  expected to be  substantially
different  from those  realized  through the end of February,  2000. No revenues
were  generated  from these five sources  during the last ten months of 2000 and
the first three months of 2001. The ability to generate revenues during the year
2001 and beyond  depends  substantially  upon the  Company's  ability to attract
users  and  traffic  to its web site  which,  in  turn,  creates  use of  online
registration,   fundraising,   sponsorships,  advertising  and  e-commerce.  The
Company's  ability  to  attract  such  traffic  requires   significant   systems
development,  marketing and personnel costs, which requires substantial funding.
If the  Company  is unable to obtain  such  funding,  its  ability  to  generate
revenues will be significantly impaired.

         Future  expenses  which  comprise cost of goods sold are expected to be
principally  comprised of systems  costs to  administer  the revenue  generating
features on the amateur  sports  Internet site, as well as potential fee sharing
expenses to organizations involved in sports event management,  fundraising, and
online registration and administration.

         General   and   administrative   expenses   have  been   comprised   of
administrative wages and benefits; occupancy and office expenses; outside legal,
accounting and other  professional fees; travel and other  miscellaneous  office
and   administrative   expenses.   Selling  and   marketing   expenses   include
selling/marketing  wages and benefits;  advertising  and  promotional  expenses;
travel and other miscellaneous related expenses.  R&D expenses consist mainly of
development expenses related to creating new applications for the web site. With
the  discontinuation  of  its  direct  sales  operations,  wages  and  benefits,
promotional,  marketing,  sales, travel and other miscellaneous  office expenses
related  to  these  activities  have  been  eliminated.   However,  the  Company
anticipates  that the decrease in such  expenses  will be offset by increases in
technology  personnel  and  development  costs  related to improving the amateur
sports  Internet  site.  In  addition,  in order to execute the  amateur  sports
Internet business, the Company anticipates significant  expenditures in business
development to create strategic alliances with third parties,  and in developing
a sales  channel to the various  amateur  sports  organizations  throughout  the
United States.

                                       22

<PAGE>



         Because  the Company  has  incurred  losses,  income tax  expenses  are
immaterial.  No  tax  benefits  have  been  booked  related  to  operating  loss
carryforwards,  given the  uncertainty of the Company being able to utilize such
loss carryforwards in future years. The Company anticipates incurring additional
losses during the coming year.

Results of Operations

         Following is  management's  discussion of the relevant items  affecting
results  of  operations  for the  periods  ended  March 31,  2001 and 2000.  The
balances  discussed  below include both results from  continuing  operations and
from operations that were  discontinued  during the period ended March 31, 2000,
as  indicated  in  Note  10 of  the  footnotes  to  the  consolidated  financial
statements.

         Revenues.  The Company generated no net revenues during the three month
period ended March 31, 2001,  compared  with net revenues of $41,188  during the
first  quarter  of 2000.  This  decrease  was due to the fact  that the  Company
discontinued its direct sales operations effective March 1, 2000.  Historically,
all  revenues  generated  by the  Company  have been  through  its direct  sales
operations.  Future  revenues are expected to be  generated  from the  Company's
amateur sports  business,  although the Company  anticipates  that such revenues
will be relatively minimal during the remainder of the year 2001.

         Cost of  Sales.  The  Company  incurred  no cost of sales for the three
month period ended March 31, 2001  compared to $34,136  during the first quarter
of 2000. Such costs historically  consisted of commission payments to the direct
sales  distribution  force, as well as the cost of the distributor  kits,  sales
aids,  and products sold through the  distributor  force and through  e-commerce
transactions.  The  decrease  from the prior  year is  directly  related  to the
corresponding  decrease in revenues, due to the discontinuation of the Company's
direct sales operations as of March 1, 2000.

         General  and  Administrative   Expenses.   General  and  administrative
expenses for the three-months ended March 31, 2001 were $254,165, a 81% decrease
from $1,319,162  during the first quarter of 2000. This decrease was principally
due to the recognition of $732,125 in expenses relating to issuances of warrants
during  the first  quarter  of the year 2000.  Management  has made a  concerted
effort  to  decrease  certain  costs  associated  with  personnel  salaries  and
benefits,  professional  fees,  contract labor, and rent and occupancy-  related
expense.  The number of employees at the Company decreased  substantially due to
the discontinuation of the Company's direct selling operations.  Payroll expense
and  professional  fees  accounted  for   approximately   $69,434  and  $32,841,
respectively,  of general and administrative  expenses during the first quarter,
as compared to $319,803 and $73,772 during the first quarter of 2000.

         Selling and Marketing Expenses.  Selling and marketing expenses for the
three month period  ended March 31, 2001 were  $195,520,  an 53%  decrease  from
$413,367   during  the  first  quarter  of  2000.  The  decrease  was  primarily
attributable to the  discontinuation  of the direct sales operations as of March
1, 2000, in which distributor  related marketing  expenses were eliminated.  The
Company  has  attempted  to  curtail  spending  in this area  given its  current
financial position.  The Company anticipates that selling and marketing expenses
in  the  future  will  increase  as  a  sales  channel  to  the  amateur  sports
organizations throughout the United States is developed.

         Product Development. Product research and development expenditures were
$46,149  during the three months  ended March 31, 2001,  as compared to $114,416
for the  three  months  ended  March  31,  2000,  a  decrease  of  60%.  Product
development  expenses  related to the  Company's  web site consist  primarily of
payroll,  software and systems,  and related costs for  programmers and software
developers.   Where  appropriate,   the  Company   capitalizes  certain  systems
development costs in accordance with generally accepted  accounting  principles.
The Company  believes that  significant  investments in product  development are
required  to remain  competitive.  Accordingly,  the  Company  expects  to incur
increased expenditures with respect to product development in future periods.

                                         23

<PAGE>




         Other Income (Expense). Net other expense totaled $19,641 for the three
months  ended  March 31,  2001,  compared to net expense of $8,466 for the three
months  ended March 31, 2000.  This  expense is comprised  primarily of interest
expenses  related to balances on Company credit cards and short term loans.  The
increase  in  interest  expense in the first  quarter of 2001 is due to interest
accrued on various  short term loans to support the  Company's  ongoing  funding
needs as well as interest  charges on past due accounts  payable.  Such past due
accounts did not exist during the first quarter of the prior year.

Liquidity and Capital Resources

         As of March  31,  2001,  the  Company's  primary  source  of  liquidity
consisted of $12,130 in cash and cash equivalents. The Company holds most of its
cash reserves in local sweep accounts with a local financial institution.  Since
inception, SportsNuts has financed its operations through a combination of short
and long- term loans, and through the private placement of its Common Stock.

         The Company has sustained significant net losses which have resulted in
an  accumulated  deficit  at March  31,  2001 of  $19,713,447  and is  currently
experiencing  a  substantial   shortfall  in  operating   capital  which  raises
considerable  doubt about the Company's  ability to continue as a going concern.
The net loss for the year ended  December  31, 2000 and the three  months  ended
March  31,  2001  was  $7,257,054  and  $515,475,   respectively.   The  Company
anticipates a substantial net loss for the year ended December 31, 2001 and with
the expected cash  requirements  for the coming weeks,  without  additional cash
inflows from investors,  there is substantial  doubt as to the Company's ability
to continue operations.

         The Company  believes these  conditions have resulted from the inherent
risks  associated  with the small startup  technology-oriented  companies.  Such
risks include,  but are not limited to, the ability to (i) generate revenues and
sales of its products and services at levels  sufficient  to cover its costs and
provide a return for  investors,  (ii)  attract  additional  capital in order to
finance  growth,  (iii)  further  develop  and  successfully  market  commercial
products and  services,  and (iv)  successfully  compete  with other  comparable
companies having  financial,  production and marketing  resources  significantly
greater than those of the Company.

         The Company believes that its capital requirements are insufficient for
ongoing operations,  with current cash reserves exhausted.  Although efforts are
presently  underway to secure certain short term financing to enable the Company
to meet its ongoing  obligations,  the Company requires  considerable amounts of
financing to make any significant  advancements in its business strategy.  There
is no  agreement  in place  with any  source of  financing,  and there can be no
assurance that the Company will be able to raise any additional  funds,  or that
such funds will be available on acceptable  terms.  Funds raised  through future
equity  financing  will  likely be  dilutive  to current  shareholders.  Lack of
additional  funds will materially  affect the Company and its business,  and may
cause the Company to cease operations. Consequently,  shareholders could incur a
loss of their entire investment in the Company.

Recent Acquisition of Sports Management Company

         Effective  April 15,  2001,  the Company  signed an agreement to aquire
Rocky Mountain Sports Alliance,  Inc. ("RMSA"), a sports management firm located
in Salt Lake  City,  Utah.  The RMSA  currently  holds the rights to a number of
sports events throughout Utah and the surrounding intermountain area. Management
believes  that the addition of the RMSA to the  Company's  technology  solutions
gives  SportsNuts a unique position in the amateur sports industry in being able
to provide  offline  as well as online  support  to teams,  leagues,  and sports
organizations.  The Company also  anticipates  that its online  revenues will be
enhanced by the  value-added  services that the RMSA provides to its  affiliated
events and participating organizations.


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<PAGE>




FORWARD LOOKING STATEMENTS AND RISK FACTORS

Forward Looking Statements

         When used in this report, the words,  "believe," "plan," "expects," and
similar expressions are intended to identify  forward-looking  statements within
the  meaning of  Section  27A of the  Securities  Act of 1933,  as amended  (the
"Securities  Act") and Section 21E of the  Securities  Exchange Act of 1934,  as
amended (the "Exchange  Act").  Such statements are subject to certain risks and
uncertainties,  including those discussed below, that could cause actual results
to differ  materially from those projected.  These forward-  looking  statements
speak only as of the date hereof.  All of these  forward-looking  statements are
based on estimates and  assumptions  made by  management  of the Company,  which
although  believed to be reasonable,  are inherently  uncertain and difficult to
predict.  There  can be no  assurance  that the  benefits  anticipated  in these
forward-looking statements will be achieved.

         The Company  undertakes  no  obligation  to update any  forward-looking
statements,  but investors are advised to consult any further disclosures by the
Company on this subject in its  subsequent  filings  pursuant to the  Securities
Exchange  Act of 1934.  Furthermore,  as  permitted  by the  Private  Securities
Litigation Reform Act of 1995, the Company provides these cautionary  statements
identifying  risk factors,  listed below,  that could cause the Company's actual
results to differ  materially  from expected and historical  results.  It is not
possible to foresee or identify all such factors. Consequently, this list should
not be considered an exhaustive statement of all potential risks,  uncertainties
and inaccurate assumptions.

Risk Factors

         Operating Risks

         Defaults in Senior Securities.  Effective February 1, 2000, the Company
sold and issued a  promissory  note secured by certain  tangible and  intangible
assets of the Company ("Note") in exchange for $450,000 in cash proceeds.  As of
May 1, 2000,  the Company is in default with respect to the Note.  If the holder
of the Note  determines to foreclose  upon the Note, the Company would likely be
forced  to sell  all of its  tangible  and  intangible  assets  to  satisfy  the
obligation represented by the Note and would, therefore, likely cease operations
entirely.  The Note and Security Agreement executed in connection therewith have
been filed as an exhibit to the  Company's  1999  annual  report on Form  10-KSB
filed with the Securities and Exchange Commission on March 30, 2000.

         Dependence on Key Personnel.  The Company's  success depends,  in large
part,  upon the talents and skills of its management  and key personnel.  To the
extent  that any of its key  personnel  are unable or refuse to  continue  their
association with the Company, a suitable replacement would have to be found. The
competition  for  qualified  personnel  in the  computer  software  and Internet
markets is intense, and there are limited numbers of such qualified personnel in
the  metropolitan  Salt Lake City area.  There is no assurance  that the Company
would  be  able to  find  suitable  replacements  for  its  existing  management
personnel or technical personnel or that such replacements could be obtained for
an amount affordable to the Company.

         Dependence  on Market  Awareness  of  Brand.  If the  Company  fails to
successfully  promote the "SportsNuts" or "SportsNuts.com"  brand name or if the
Company incurs  significant  expenses promoting and maintaining this brand name,
there could be a material adverse effect on the Company's  business,  results of
operations,  and financial condition.  Due in part to the emerging nature of the
market for Internet management solutions and the substantial resources available
to many of the Company's  competitors,  there may be a time- limited opportunity
to achieve and maintain a significant  market share.  Developing and maintaining
awareness  of the  Company's  brand name is  critical  to  achieving  widespread
acceptance of the Company's management and reporting systems.  Furthermore,  the
importance of brand recognition will increase as

                                             25

<PAGE>
competition  in the market for the  Company's  products and services  increases.
Successfully  promoting and  positioning the Company's brand will depend largely
on the  effectiveness  of the  Company's  marketing  efforts,  event  management
capabilities,  and its  ability  to  attract a large  number of  amateur  sports
enthusiasts to its Web site on a consistent basis. Consequently, the Company may
need to increase its  financial  commitment  to creating and  maintaining  brand
awareness among consumers.

         Additional  Financing  Requirements.  The Company  will likely  require
substantial   additional   capital  in  the  future  for   expansion,   business
development, marketing, computer software and systems, overhead, administrative,
and other expenses. There is no assurance that the Company will be able to raise
additional funds or that financing will be available on acceptable  terms.  Lack
of  additional  funds could  significantly  affect the Company and its business.
Further,  funds raised through future equity  financing  could be  substantially
dilutive to existing shareholders.

         Development Stage Company.  The Company was organized on July 12, 1996.
Since the date of its inception, the Company has incurred substantial losses and
has  not  yet  generated  a  profit.  To  achieve  any  significant  measure  of
profitability,  the Company  must  increase  the number of sports  events  under
management  and create  substantial  activity  through  its Web Site to generate
revenues, and there is no assurance that the Company will do so in the future or
that such  revenue  generation  will  ultimately  lead to the  Company  becoming
profitable.

         Seasonality.  While  neither  seasonal  nor  cyclical  variations  have
materially  affected  the  Company's  results  of  operations  in the past,  the
Company's short operating history may have suppressed these factors.
 For example,  increases in site traffic will likely  correspond  with the three
primary  sports  seasons  (football,  basketball,  and  baseball)  and therefore
revenues can fluctuate  greatly depending upon the time of year. There can be no
assurance that seasonal or cyclical  variations  will not  materially  adversely
affect the Company's results of operations in the future.

         Growth  Management.  The Company  anticipates  that it will  experience
rapid  growth in the next few years of  operations.  The  management  challenges
imposed by this growth  include entry into new markets,  growth in the number of
persons accessing the Web Site,  management of affiliated sports  organizations,
employees and customers,  expansion of facilities and computer systems necessary
to accommodate such growth,  and additions and modifications to the products and
services  offered  through  the  Company's  Web Site.  To manage  these  changes
effectively,  the  Company may be required  to hire  additional  management  and
operations personnel and to improve its operational,  financial,  computer,  and
management  systems.  If the Company is unable to manage growth  effectively  or
hire or retain  qualified  personnel,  the  Company's  business  and  results of
operations could be materially adversely affected.

         Regulation of Fundraising Activities.  Most states regulate fundraising
activities through "Charitable  Solicitation"  statutes.  To the extent that the
Company is subject to such  statutes,  the  Company may be required to file as a
paid solicitor or professional  fundraiser and pay a filing fee in each state in
which it  attempts  to engage  amateur  sports  teams and  participants  to sell
Internet advertising to local merchants and organizations. Moreover, inasmuch as
such statutes apply to any person engaged in such  activities,  every person who
engages  in  fundraising  activities  may  be  required  to  register  as a paid
solicitor or professional fundraiser and pay a registration fee in each state in
which they  attempt to sell banner  advertising  on behalf of the  Company.  Any
determination  that would require state registration for amateur sports teams or
participants  may have a  material  adverse  effect on the  Company's  business,
financial condition, and results of operations.

     Government  Regulation  of the  Internet.  There are  currently few laws or
regulations  directly applicable to electronic  commerce.  Due to the increasing
popularity  and use of the  Internet,  it is possible  that a number of laws and
regulations  may be adopted with respect to the Internet which could  materially
increase  the  cost  of   transacting   business  on  the   Internet.   Although
transmissions from the Company's Web Site

                                 26
<PAGE>



originate  from the State of Utah,  the  government of the United States and the
governments of other states and foreign countries might attempt to regulate such
transmissions or assess taxes, fees, tariffs,  duties, or other payments against
the Company,  the  Company's  Affiliates,  or customers  purchasing  products or
services  through  the Web  Site.  Any such  regulations  or  assessments  could
adversely  affect the  Company's  business,  operating  results,  and  financial
condition.

         Dependence on Continued  Growth in Use of the  Internet.  The Company's
future success is  substantially  dependent upon continued  growth in the use of
the  Internet in order to support the volume of activity  necessary  to generate
advertising  revenue and the sale of its products and services.  Rapid growth in
the use of the  Internet  is a  relatively  recent  phenomenon,  and the Company
relies on consumers who have  historically  used traditional  means of media and
commerce  for  entertainment  and the  purchase of goods and  services.  For the
Company to be successful,  these consumers must accept and utilize novel ways of
conducting business and exchanging  information.  There can be no assurance that
communication  or commerce over the Internet will become more widespread or that
the Internet will otherwise become a viable commercial marketplace. Moreover, to
the extent that the Internet  continues to experience  significant growth in the
number  of users  and  frequency  of use,  there  can be no  assurance  that the
Internet  infrastructure  will continue to be able to support the demands placed
upon it by such growth,  or that the  performance or reliability of the Internet
will not be adversely  affected  thereby.  In addition,  certain factors such as
Internet  commerce  security and the speed of Internet  transmissions  may deter
existing as well as potential  customers  from engaging in  transactions  on the
Internet.  The  occurrence  of any of these  risks  could  adversely  affect the
Company's business, operating results, and financial condition.

         Risk  of  Computer  System  Failure.  The  success  of the  Company  is
substantially dependent upon its ability to deliver high quality,  uninterrupted
access to its Web Site,  which  requires  that the Company  protect its computer
hardware and software systems and the data and information  stored in connection
therewith.  The  Company's  systems are  vulnerable  to damage by fire,  natural
disaster, power loss,  telecommunications failures,  unauthorized intrusion, and
other catastrophic events. Any substantial interruption in the Company's systems
would  have a  material  adverse  effect on the  Company's  business,  operating
results,  and  financial   condition.   Although  the  Company  carries  general
commercial  insurance coverage,  such coverage may not be adequate to compensate
for the  losses  that may occur.  In  addition,  the  Company's  systems  may be
vulnerable to computer viruses,  physical or electronic break-ins,  sabotage, or
other  problems  caused by third  parties  which  could  lead to  interruptions,
delays,  loss of data, or cessation in service to persons desiring to access the
Company's Web Site.  The  occurrence of any of these risks could have a material
adverse effect upon the Company's business, results of operations, and financial
condition.

         Electronic Data Transmission  Security Risks. A significant  barrier to
the  electronic  transmission  of  confidential  data over the  Internet  is the
perception that such data may not be secure.  The Company relies upon encryption
and authentication technology to provide the security necessary to effect secure
transmissions  of  confidential  information.  There  can be no  assurance  that
advances in decryption  technology,  computer espionage,  and other developments
will not result in a breach or compromise of the algorithms  used by the Company
to protect  transaction  data of persons  accessing the Web Site,  and therefore
lead to the  misappropriation  of such data by third  parties.  Any such breach,
compromise, or misappropriation could damage the Company's reputation and expose
the Company to a risk of loss or litigation  and possible  liability,  and could
have  a  material  adverse  effect  upon  the  Company's  business,  results  of
operations, or financial condition.

         Rapid  Technological  Change.  The Internet and on-line  industries are
characterized  by rapid  technological  change,  changing market  conditions and
customer demands, and the emergence of new industry standards and practices that
could render the Company's  existing Web Site and the services provided pursuant
thereto obsolete.  The Company's future success will substantially depend on its
ability to enhance its existing  services,  develop new services,  and otherwise
respond to technological  advances in a timely and cost-effective manner. If the
Company is unable, for technical,  legal,  financial, or other reasons, to adapt
in a timely manner

                                   27

<PAGE>



in response to changing market  conditions or customer  requirements,  or if the
Company's Web Site does not achieve market acceptance,  the Company's  business,
operating results, and financial condition would be adversely affected.

         No Proprietary  Protection for  Technology.  The Company's  statistical
information  system and the league  management  system are not  protected by any
copyright or patent,  and the Company does not anticipate  filing an application
with the United  States  Patent and  Trademark  Office  ("USPTO")  or the United
States  Copyright  Office for protection of these systems.  Although the Company
believes that  copyright and patent  protection for these systems is either cost
prohibitive or  unnecessary,  it may be wrong. If the Company is wrong, it could
face unexpected expenses pursuing,  defending, or otherwise becoming involved in
a copyright or patent dispute, any of which could have a material adverse effect
upon the Company's business, results of operations, and financial condition.

         Uncertain  Protection of Trade Names and Related Intangible Assets. The
Company has submitted applications to the USPTO for trademark protection for the
name  "SportsNuts.com"  with  respect to the  following  classes of products and
services: (i) vitamins,  minerals,  and herbal supplements;  (ii) sporting goods
and apparel; (iii) Internet communication,  education,  and entertainment;  (iv)
miscellaneous goods and services.  Currently the mark "E-Sports Mall" is pending
registration.  The  Company  has also  registered  the  Internet  domain  names,
"www.sportsnuts.com,"  and  "www.sportsnuts.net."  Given  the lack of  resources
available to the Company, the Company has not vigorously pursued finalization of
its trademark  applications and the status of such  applications is presently in
doubt.  If the Company is  unsuccessful  in obtaining the right of full usage of
its name from the USPTO,  other companies with names,  marks, or slogans similar
to SportsNuts or SportsNuts.com  could seek to require that the Company obtain a
license  from them or require  the  Company to change its name,  either of which
could entail  substantial costs.  Additionally,  if the Company were requried to
change its name,  it could lose all goodwill  associated  with the  "SportsNuts"
mark. In addition,  future products and services offered by the Company may need
to be marketed under different names if the mark  "SportsNuts"  causes confusion
with another  trade name being used by another  company.  The Company could also
incur  substantial  costs to defend any legal action  taken  against the Company
pursuant to a trademark or service mark dispute. If any legal action against the
Company, its asserted  trademarks,  or service marks should be found to infringe
upon  intellectual  property  rights  of a third  party,  the  Company  could be
enjoined from further  infringement and could be required to pay damages. In the
event a third party were to sustain a valid claim  against the  Company,  and in
the event a required  license  were not  available  on  commercially  reasonable
terms,  the Company's  financial  operations and results of operations  could be
materially  adversely  affected.  Litigation,  which could result in substantial
cost to and  diversion of  resources  of the  Company,  may also be necessary to
enforce  intellectual  property  rights of the  Company or to defend the Company
against claimed infringements of the rights of others.

         Competition and Technological Change. The market for Internet products,
services,  and  advertising  within the amateur  sports  market is new,  rapidly
evolving,   and  intensely  competitive  and  will  continue  to  undergo  rapid
technological  change.  The  Company  must  continue  to enhance and improve the
functionality  and  features  of its  online  services  and  sports  information
management software. If new industry needs,  standards, or practices emerge, the
Company's  existing  services,  technology,  and  systems  may become  obsolete.
Developing   and  enhancing  the  Company's   proprietary   technology   entails
significant  technical and business risks, in addition to substantial  costs. If
the Company faces delays in introducing new services, products and enhancements,
its users may  forego  the use of the  Company's  services  and use those of its
competitors.  The Company  currently  competes  with many other  amateur  sports
information  and product web sites and the Company  anticipates  competition  to
intensify in the future.  Barriers to entry may not be significant,  and current
and new  competitors may be able to launch new web sites quickly at a relatively
low cost. Accordingly, the Company believes that its success will depend heavily
upon  achieving   significant  market  acceptance  before  its  competitors  and
potential  competitors  introduce  competing  services.  Many  of the  Company's
competitors,  as well as potential  entrants  into the Internet  amateur  sports
market, have longer operating histories,  larger customer or user bases, greater
brand recognition and significantly greater financial,

                                     28

<PAGE>



marketing,  and other  resources than the Company.  Furthermore,  several of the
Company's  competitors have acquired certain key sponsorships and  relationships
with  a few  well-known  amateur  sports  organizations  which  may  impede  the
Company's  growth and thereby have a material  adverse effect upon the Company's
business, results of operations, and financial condition.

         Investment Risks

         Speculative Investment.  The shares of the Company's common stock are a
speculative  investment.  To date, the Company has generated  substantial losses
and has yet to achieve a profit. If the Company fails to generate profits, it is
unlikely  that the Company will be able to meet its  financial  obligations  and
investors could lose their entire investments.

         Securities Class Action Claims Based Upon Price Fluctuation. Securities
class action  claims have been  brought  against  issuing  companies in the past
after volatility in the market price of a company's securities.  With respect to
the Company,  such  litigation  could be very costly and divert the attention of
the Company's  management and resources,  and any adverse  determination in such
litigation could also subject the Company to significant liabilities, any or all
of which could have a material adverse effect on the Company's business, results
of operations, and financial condition.

         No Active Market.  Although the Company's shares are traded on the NASD
Electronic  Bulletin Board,  the Company  believes that the public trading price
may be an inaccurate representation of the value of the Company because there is
no active  public  market for the shares and no analysts  or NASD market  makers
actively follow the Company.

         No Dividends.  The Company does not anticipate  paying dividends on its
Common  Stock in the  foreseeable  future,  and may be  restricted  from  paying
dividends in the future pursuant to subsequent financing arrangements.

         Concentration  of  Voting  Power.  According  to the terms of a certain
convertible promissory note sold and issued by the Company to Gardner Management
Profit Sharing Plan and Trust ("Trust"),  the Trust possesses voting rights with
respect  to a  substantial  majority  of  the  voting  shares  of  the  Company.
Consequently,  the trustee of the Trust  possesses  the ability to  unilaterally
control the election of the Company's Board of Directors. In addition,  pursuant
to the Company's  Certificate of Incorporation,  the Board of Directors has been
divided into three classes, with only one class subject to reelection in a given
year. The Certificate of Incorporation  requires a vote of 66 2/3% of the shares
of the Company to amend the  provision  governing  the  election  of  directors.
Consequently,  even if a shareholder or group of shareholders  were to acquire a
majority of the outstanding  shares of the Company,  such acquisition  would not
necessarily  lead to a change in control of the  Company.  However,  the Company
cannot guarantee that certain persons, either collectively or individually, will
not be able to control the election of the Board of Directors  and that minority
shareholders will not be adversely affected as a result.

         Anti-Takeover Provisions.  The Restated Certificate of Incorporation of
the  Company  contains  certain  provisions  which could be an  impediment  to a
non-negotiated  change in control of the  Company,  namely an  ability,  without
stockholder  approval,  to issue up to 20,000,000 shares of preferred stock with
rights and preferences determined by the board of directors, staggered terms for
directors,  and  super-voting  requirements.  These  provisions  could  impede a
non-negotiated change in control and thereby prevent stockholders from obtaining
a premium for their Common Stock.

         Securities  Eligible for Public Trading. Of the 5,239,301 shares of the
Company's Common Stock  outstanding at March 31, 2001,  approximately  2,600,000
are  freely  tradeable  or  immediately  eligible  for  resale  under  Rule  144
promulgated  pursuant  to the  Securities  Act of  1933,  as  amended.  Sales of
substantial  amounts  of  freely  tradeable  stock in the  public  market  could
adversely affect the market price of the Common

                                       29

<PAGE>



Stock.  The Company has also filed a registration  statement with respect to its
1999 Stock Option Plan (subsequently amended and restated),  the result of which
could be the sale of a significant  number of shares in the public  market,  and
consequently,  an adverse  effect upon the public trading price of the Company's
Common Stock.

         Private Liability of Management.  The Company has adopted provisions in
its Certificate of  Incorporation  which limit the liability of its officers and
directors and provisions in its bylaws which provide for  indemnification by the
Company of its  officers  and  directors  to the  fullest  extent  permitted  by
Delaware  corporate law. The Company's  Certificate of  Incorporation  generally
provides that its directors  shall have no personal  liability to the Company or
its  stockholders for monetary damages for breaches of their fiduciary duties as
directors, except for breaches of their duties of loyalty, acts or omissions not
in good faith or which involve  intentional  misconduct or knowing  violation of
law, acts involving unlawful payment of dividends or unlawful stock purchases or
redemptions,  or any  transaction  from  which a director  derives  an  improper
personal benefit. Such provisions  substantially limit the shareholders' ability
to hold directors liable for breaches of fiduciary duty.

         Potential  Issuance  of  Additional  Common and  Preferred  Stock.  The
Company is authorized to issue up to 200,000,000  shares of Common Stock. To the
extent of such  authorization,  the Board of  Directors of the Company will have
the ability, without seeking shareholder approval, to issue additional shares of
common stock in the future for such  consideration as the Board of Directors may
consider  sufficient.  The issuance of additional Common Stock in the future may
reduce the  proportionate  ownership and voting power of existing  shareholders.
The Company is also  authorized  to issue up to  20,000,000  shares of preferred
stock,  the rights and  preferences  of which may be designated in series by the
Board of Directors.  To the extent of such authorization,  such designations may
be made without shareholder approval.  The designation and issuance of series of
preferred  stock in the future would create  additional  securities  which would
have dividend and liquidation preferences over common stock.

         Volatility of Stock Prices.  In the event that there is an  established
public market for the Company's  Common Stock,  market prices will be influenced
by many factors and will be more subject to significant fluctuations in response
to  variations  in  operating  results of the Company and other  factors such as
investor perceptions of the Company,  supply and demand, interest rates, general
economic conditions and those specific to the industry, developments with regard
to the Company's activities, future financial condition and management.

         Applicability  of Low Priced Stock Risk  Disclosure  Requirements.  The
Common Stock of the Company may be considered a low priced  security under rules
promulgated  under the  Securities  Exchange  Act of 1934.  Under  these  rules,
broker-dealers participating in transactions in low priced securities must first
deliver a risk  disclosure  document which  describes the risks  associated with
such stocks,  the  broker-dealers's  duties, the customer's rights and remedies,
certain  market  and other  information,  and make a  suitability  determination
approving the customer for low priced stock transactions based on the customer's
financial situation,  investment experience and objectives.  Broker-dealers must
also disclose these  restrictions  in writing to the customer,  obtain  specific
written consent of the customer,  and provide monthly account  statements to the
customer. With all these restrictions, the likely effect of designation as a low
priced stock will be to decrease the  willingness  of  broker-dealers  to make a
market for the stock, to decrease the liquidity of the stock and to increase the
transaction  cost of  sales  and  purchases  of such  stock  compared  to  other
securities.


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<PAGE>



                                     PART II

                                OTHER INFORMATION

ITEM 1.        LEGAL PROCEEDINGS

               On  August  18,  2000,  Mediaworks,   Inc.,  a  Utah  corporation
("Mediaworks"),  filed a complaint  against  the Company in the Fourth  Judicial
District Court of Utah County, State of Utah, regarding the collection of monies
allegedly  owed to  Mediaworks  by the  Company  for media  production  services
rendered.  The Mediaworks  complaint seeks to recover $8,409.77,  including pre-
and  post-judgment  interest,  costs, and attorneys fees. On September 19, 2001,
the  Company  filed an  answer  and  counterclaim  to the  Mediaworks  complaint
alleging breach of contract for media production services that were paid for but
not  performed  by  Mediaworks.  The  Company's  counterclaim  seeks to  recover
$9,409.78,  including costs and attorneys  fees. On October 5, 2000,  Mediaworks
filed a reply to the Company's counterclaim.

               On  December  15,  2000,   North  Star  Printing,   a  Utah  sole
proprietorship  ("NSP"),  filed a  complaint  against  the Company in the Fourth
Judicial District Court of Utah County,  State of Utah, regarding the collection
of monies allegedly owed to NSP by the Company for printing  services  rendered.
The NSP complaint  seeks to recover  $7,271.49,  including costs and interest at
the rate of 18% per annum on invoices  more than 30 days past due. On January 5,
2001, the Company filed an answer to the NSP complaint.

               On December 22, 2000,  CMD Realty  Investment  Fund IV, L.P.,  an
Illinois limited partnership  ("CMD"),  filed a forcible detainer action against
SportsNuts.com,  Inc., a controlled  subsidiary of the Company  ("SNC"),  in the
Maricopa County Superior Court,  State of Arizona,  regarding a lease of certain
office  space in Phoenix,  Arizona.  On January 23, 2001,  the court  rendered a
final  judgment  against SNC,  finding it guilty of forcible  entry and detainer
under  Arizona law. The judgment  awarded CMD right to  possession of the leased
premises  and  granted  judgment  in favor of CMD in the sum of  $19,356.89  for
unpaid rent and other charges, costs, and expenses. CMD subsequently drew upon a
letter of credit posted by SNC for the leased premises to pay the judgment.  CMD
also  retained  its right  against  SNC to recover  rent and other costs for the
remainder  of the  lease,  which  continues  until  June  30,  2004 at a rate of
$5,150.42 per month.  The judgment also required CMD to mitigate its damages and
attempt to re-lease the property. SNC vacated the leased premises on January 25,
2001.

ITEM 2.        CHANGES IN SECURITIES

               Not applicable.

ITEM 3.        DEFAULTS UPON SENIOR SECURITIES

               Effective  February  1,  2000,  the  Company  sold  and  issued a
promissory note secured by certain tangible and intangible assets of the Company
("Note")  in exchange  for  $450,000 in cash  proceeds.  As of May 1, 2000,  the
Company  is in  default  with  respect  to the Note.  As of April 1,  2001,  the
principal amount of the Note,  together with interest as accrued, is convertible
into  approximately   5,395,562  shares  of  common  stock.  The  Note  and  its
accompanying  Security  Agreement have been filed as an exhibit to the Company's
1999  annual  report on form  10-KSB  filed  with the  Securities  and  Exchange
Commission on March 30, 2000.


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

               Effective April 30, 2001, the shareholders, by majority written
consent, approved the Company's

                                        31

<PAGE>



Amended and Restated 2000 Stock Option Plan and a  restatement  of the Company's
Certificate of Incorporation  providing for a change of the Company's  corporate
name from SportsNuts.com International, Inc. to SportsNuts, Inc. The Company has
filed its Amended and Restated  2000 Stock Option Plan and Restated  Certificate
of Incorporation as Exhibits to this Form 10-QSB.


ITEM 5.        OTHER INFORMATION

               Not applicable.

ITEM 6.        EXHIBITS AND REPORTS ON FORM 8-K:
               the following documents are filed as exhibits to this
               Form 10-QSB:

INDEX TO EXHIBITS
<TABLE>
<CAPTION>

        Number       Exhibits
<S>     <C>         <C>
        3.1          Amended and Restated Certificate of Incorporation of
                     SportsNuts, Inc.

        3.2          Amended and Restated Bylaws of SportsNuts, Inc.,
                     a Delaware corporation.

        10.1         Convertible Promissory Note and Security Agreement among
                     gARDNER Management Profit Sharing Plan and Trust,
                     SportsNuts.com, Inc., Sportzz.com,Inc., and the Company,
                     including amendments, dated February 1, 2000. (1)

        10.2         Consulting Agreement with Mark Johnson dated November 22,
                     2000. (2)

        10.6         SportsNuts, Inc. Amended and Restated 2000 Stock Option Plan

        21.1         Subsidiaries of the Registrant.(3)

        27.1         Financial Data Schedule
</TABLE>

-----------

       (1) Filed as an Exhibit to the  Company's  Annual  Report on Form
       10-KSB, filed with the Commission on March 30, 2000.

       (2) Filed as an Exhibit to the Company's  Registration  Statement
       on Form S-8, filed with the Commission on December 21, 2000.

       (3) Filed as an Exhibit to the Company's quarterly report Form 10-QSB
       filed with the Commission on May 19, 1999.

               SIGNATURES


               Pursuant to the  requirements  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.

                           SPORTSNUTS, INC.


Dated:  May 14, 2001       By:  /s/ Kenneth I. Denos
                           --------------------------------
                                Kenneth I. Denos
                                Dhief Financial Officer

                                     32

<PAGE>

Exhibit Index
<TABLE>
<CAPTION>

        Number       Exhibits
<S>     <C>          <C>
        3.1          Amended and Restated Certificate of Incorporation of
                     SportsNuts, Inc.

        3.2          Amended and Restated Bylaws of SportsNuts, Inc.,
                     a Delaware corporation.

        10.1         Convertible Promissory Note and Security Agreement among
                     gARDNER Management Profit Sharing Plan and Trust,
                     SportsNuts.com, Inc., Sportzz.com,Inc., and the Company,
                     including amendments, dated February 1, 2000. (1)

        10.2         Consulting Agreement with Mark Johnson dated November 22,
                     2000. (2)

        10.6         SportsNuts, Inc. Amended and Restated 2000 Stock Option
                     Plan

        21.1         Subsidiaries of the Registrant.(3)

</TABLE>

-----------

       (1) Filed as an Exhibit to the  Company's  Annual  Report on Form
       10-KSB, filed with the Commission on March 30, 2000.

       (2) Filed as an Exhibit to the Company's  Registration  Statement
       on Form S-8, filed with the Commission on December 21, 2000.

       (3) Filed as an Exhibit to the Company's quarterly report Form 10-QSB
       filed with the Commission on May 19, 1999.