U.S. SECURITIES AND EXCHANGE COMMISSION
                      WASHINGTON, D.C. 20549


                           FORM 10-KSB

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

           For the fiscal year ended: December 31, 2001

                                OR

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

                 Commission file number: 0-26973

                        Whole Living, Inc.
      (Exact name of registrant as specified in its charter)

         Nevada                                        87-0621709
(State of incorporation)                  (I.R.S. Employer Identification No.)

629 East 730 South, Suite 201, American Fork, Utah     84003
(Address of principal executive offices)              (Zip code)

Issuer's telephone number, including area code: (801) 772-3300

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

Securities registered pursuant to Section 12(g) of the Act: Common Stock

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

Check if disclosure of delinquent filers in response to item 405 of Regulation
S-B is not contained herein, and will not be contained, to the best of
registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB.   [ ]

State issuer's revenue for its most recent fiscal year: $5,965,325

As of April 10, 2002, the registrant had 24,044,340 shares of common stock
outstanding.  The aggregate market value of the voting stock held by
non-affiliates as of that date was approximately $4,918,572.

Documents incorporated by reference: None

Transitional Small Business Disclosure Format (check one): Yes [_]___ No [X ]

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                        TABLE OF CONTENTS

                              PART I

Item 1.   Description of business...........................................3
Item 2.   Description of property..........................................11
Item 3.   Legal proceedings................................................11
Item 4.   Submission of matters to a vote of security holders..............11

                             PART II

Item 5.   Market for common equity and related stockholder matters.........11
Item 6.   Management's discussion and analysis.............................15
Item 7.   Financial statements.............................................19
Item 8.   Changes in and disagreements with accountants ...................38

                             PART III

Item 9.   Directors and executive officers; compliance with Section 16(a)..38
Item 10.  Executive compensation...........................................39
Item 11.  Security ownership of certain beneficial owners and management...41
Item 12.  Certain relationships and related transactions...................41
Item 13.  Exhibits and reports on Form 8-K.................................42





     In this annual report references to "Whole Living," "we," "us," and
"our" refer to Whole Living, Inc.

                    FORWARD LOOKING STATEMENTS

      This annual report contains certain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995.  For this
purpose any statements contained in this annual report that are not statements
of historical fact may be deemed to be forward-looking statements.  Without
limiting the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "estimate" or "continue" or comparable terminology are intended
to identify forward-looking statements.  These statements by their nature
involve substantial risks and uncertainties, and actual results may differ
materially depending on a variety of factors, many of which are not within
Whole Living's control.  These factors include but are not limited to economic
conditions generally and in the industries in which Whole Living may
participate; competition within Whole Living's chosen industry, including
competition from much larger competitors; technological advances and failure
by Whole Living to successfully develop business relationships.


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                              PART I

                         ITEM 1: BUSINESS

HISTORICAL DEVELOPMENT

      Whole Living, Inc. was incorporated in the state of Nevada on March 18,
1999.  On March 19, 1999 Brick Tower Corporation, an Idaho corporation
(formerly Hystar Aerospace Marketing Corporation of Idaho), merged with Whole
Living for the sole purpose of changing Brick Tower's domicile from Idaho to
Nevada.  In May of 1999, Whole Living completed a reverse merger with Whole
Living Inc., a Utah corporation.  Whole Living Utah had been formed on
November 25, 1998 and owned the products and formulas presently being marketed
by Whole Living, as well as the trademark "Brain Garden."

OUR BUSINESS

      Whole Living, doing business as Brain Garden(TM), is a total lifestyle
company focused on improving mental and physical performance through a Whole
Foods - Whole Learning - Whole Living philosophy.  Our message is a blend of
cutting-edge research and ancient wisdom and methods.  By ancient wisdom, we
refer to certain dietary practices and specific whole-food combinations that
have been viewed for centuries as promoting health.  These include:

      i.  Jewish practice for nearly 4,000 years (Amos 9:14; Daniel
          1:11-20), their tradition and scriptures which state that eating
          certain foods, including "pulse," results in greater health and
          mental acuity; and
      ii. Historic Christian practices, traditions and scriptures (1 Cor. 3:2;
          1 Tim. 4:3; Heb. 5:12; D&C 89) which state that eating certain foods
          and not others is healthier for the body.

      In addition, the Surgeon General of the United States and the Physicians
Committee for Responsible Medicine have both concluded that the key to good
health is proper diet (defined in part as fruits, vegetables, nuts, seeds,
legumes and whole grains, as opposed to processed foods), plenty of water and
regular exercise.

      Our product philosophy is to combine the best of science and nature and
to produce food and personal care products that are 100% natural, and to the
extent possible, organic.  We employ a network marketing system to sell our
products to customers and independent distributors, and we rely on our
distributors to sponsor new distributors. We are committed to developing and
providing quality products that are easy to use, easy to sell and effective.

      Whole Foods. We promote an appreciation for earth's bounties and
encourage eating real foods, such as, fresh fruits and vegetables, legumes and
grains.  Our line of Whole Foods snacks and meal replacements are convenient
and enjoyable and reduce or eliminate the need for nutritional supplements.
We believe that pills and supplements cannot replace Whole Foods and that
twenty first century convenience foods provide a high-fat, high-sugar,
low-fiber diet which may have resulted in increased cancer, heart disease and
obesity rates.

      Whole Learning.  We believe imagination is the key to unlocking learning
potential.  Our Whole Learning products include interactive programs that help
the consumer create a "home-learning environment" for their family.  We offer
multi-media programs for learners from preschool through adulthood.

      Whole Living.  We provide personal development and life-balancing
programs to help people and families experience life more abundantly.  We have
created all-natural, chemical-free product lines of personal care, skin care
and essential oils, to enhance the rituals of daily living.

Principal Products

      Our major Whole Foods product is Pulse, which consists of a variety of
nuts, seeds, fruits and grains.

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Pulse is packaged loose both individual and in family size canisters.  The
ingredients used in Pulse are combined in specific mathematical ratios which
we believe are based on a 2500 year old formula which originated in Biblical
times.  (See, Chapter 1 of the King James version of Daniel.)   We believe
nutritional science is strongly pointing to frequent snacking throughout the
day as opposed to "three square meals." Pulse may be used as a snack or a meal
replacement.  Pulse has the proteins, fibers, carbohydrates and other
nutrients needed in a healthy diet and comes in four different flavors.  Pulse
also is an integral part of our weight-loss program called "Daniel's 10-day
Challenge."  Our other major Whole Foods snack products include Parched Pulse
and Brain Grain.  For the 2001 fiscal year, approximately 32% of our product
sales was derived from our Whole Foods snack products and 38% was derived from
our weight-loss program.

      Our Whole Learning products include our interactive educational programs
which provide learning tools for learners from kindergarten through adulthood.
These programs are multi-sensory and interactive and are designed to involve
the creative imagination of the learner.  We believe the "rote learning" model
of education has been used to routinize the learning process and control the
mind set of the learner.  We believe rote learning fails to recognize the
individuality of learners, stifles creativity and robs the human mind.  We
believe our programs offer a clear, imaginative alternative for learners of
all ages.  These Whole Learning products accounted for 1% of our sales during
fiscal year 2001.

      Our Whole Living product line includes essential oils, and chemical-free
personal and home-care products which are made from the oils and tissues of
plants.  We believe that what is put on the skin is passed through the skin
and finds its way into other tissues in the body.  Therefore, an individual
should not put anything on the body that cannot also be put in the body.

      Our Essential Oils and Earthborn Creations personal care line of
products provide health benefits for the user of these natural plant oils
found in the tissues of aromatic plants.  These products are designed to be
applied topically to the body for therapeutic relief. Our Earthborn Creations
products include creams, lotions, cleansers and shampoos made from essential
oils and mixing powders that are all natural and chemical-free, and made
entirely from plants.  Our most popular personal care product is Pro L'eve
which is a full strength progesterone cream made from wild yams, soy and other
natural ingredients.  Pro L'eve is designed for women who experience hormone
imbalance.  The Earthborn Creations  personal care, essential oils and
associated products were approximately 15% of our revenues for the fiscal year
2001.

      Product Guarantees.  We provide a 100% satisfaction guarantee.  For
fourteen (14) days from the date of purchase, our product return policy allows
a retail purchaser to return any product to us for a full refund.  After
fourteen (14) days from the date of purchase, the return privilege is in our
discretion.  If, for any reason, the customer of a distributor does not want
to keep a product purchased by the customer from the distributor, we encourage
the distributor to take back the product and either replace it with another
product or return the customer's money, whichever the customer prefers.  We
charge 15% of the purchase price as a restocking fee for return of a product
which is not faulty.

      If, for any reason, and within fourteen (14) days, the distributor does
not want to keep a product purchased by that distributor, in accordance with
our fourteen-day return policy, we will replace the product or take back the
product and reimburse the distributor for the product, whichever the
distributor prefers.  We warrant any item that is not date stamped for a
period of one year.  Our product return policy is a material aspect of the
success of the distributors in developing a retail consumer base.  Our
experience with actual product returns has averaged approximately 1% of sales
for the 2001 and 2000 fiscal year.

      Product Liability.  We maintain an insurance policy for product
liability claims with a $1,000,000 per claim and $2,000,000 annual aggregate
limit.

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Distribution Network

      We have sales offices located in American Fork, Utah; Clear Island,
Queensland, Australia; and Tokyo, Japan. We buy product from our third-party
suppliers (See, "Raw Materials and Suppliers," below) and warehouse the
majority of the bulk food product at our facility here in the United States.
The bulk product is either prepared for product orders here in the United
States or shipped to Australia, Canada, New Zealand or Japan and the final
fulfillment is accomplished at those locations.

      Distributors pay for products prior to shipment, therefore we carry
minimal accounts receivable.  Distributors place orders by phone using an
automated system or by placing the order with our order takers.  They usually
pay for the products with a credit card.  Less than 2% of our sales are paid
for with cash.  Typically, we experience back orders with less than 1% of our
orders.

      Unigen Plan. We rely on network marketing for the distribution of our
products.  Our revenue depends directly upon the sales efforts of our
distributors. We distribute our products exclusively through independent
distributors who have contracted directly with us.  Anyone can purchase
products from us for personal use or resell, but he or she does not have the
potential to earn commissions.  Only those individuals who sign up as a
distributor can sponsor other distributors and earn commissions from the
resale of our products.  Management believes that one of our key competitive
advantages is our "Unigen" distributor compensation plan (the "Unigen Plan").

      Network marketing companies and their marketing plans have been around
for over 50 years.  Many of the founding companies in this industry such as
Amway, Mary Kay, and Shaklee, have not made significant changes to their
marketing plans for decades.  During the 1970's, 1980's and into the 1990's,
new companies in the industry such as Nu Skin Enterprises, Neways, Natures
Sunshine Products, Melaleuca, and many others have taken aspects of these
original marketing plans and added various twists and/or changes in order to
make their compensation plans more rewarding for distributors.

      In the traditional networking system such as that used by Nuskin, a
group of people occupy a single level within the compensation plan.  Under the
"unilevel" plan, a single person occupies a level within the compensation
structure.  Nature's Sunshine Products, Inc. and Young Living Essential Oils
represent two of our competitors who use versions of this "unilevel" plan.
Under this structure, a distributor's down line is composed of numerous levels
consisting of separate individuals.  As more individuals come on line below
these levels, each becomes a "leg" for the first distributor.

      Under our system, which we call the 2-Infinity Plan, any distributor on
any level can receive compensation.  Each individual distributor can qualify
for compensation on a monthly basis.  Therefore, if they qualify by purchasing
or retailing the requisite quantity of product and establishing the necessary
number of legs, a distributor could receive compensation in his or her first
month with Whole Living.

      We combine the 2-Infinity Plan with what we call a "deep generational
pay program."  Generational pay programs are currently being used by Young
Living Essential Oils, Neways, LifeForce International and New Vision.  Under
a generational program, a distributor receives a small percentage from other
distributors that are brought on line below them, both directly and indirectly
via the "legs."  In our system, this generational concept is tied into our
Captain, Team Captain and All Star classifications.  As a distributor gains
more "qualified legs" which qualify through monthly purchasing volume, his
status changes and his percentage of generational compensation increases.

      For example, to obtain the status of Captain, a distributor needs at
least three "active" legs which is defined as a leg that has at least the
minimum monthly purchasing volume.  As a distributor adds new "active" legs
and builds depth, his or her status moves from Captain to Team Leader, All
Star, etc.  At each new level, the generational compensation percentages and
amount of compensation increases.  Therefore, an established distributor may
receive a percentage of sales generated by an ever growing number of new
distributors that

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are brought into the program in his or her down line.  In our system, these
levels can extend downward in many different directions as new distributors
build their own legs or "generations."  At a predetermined point, the founding
distributor can be blocked from receiving new compensation directly from a
portion of a successful, active leg.  While the original distributor will
continue to receive a percentage of the sales generated by other down line
distributors, he or she will stop receiving compensation from distributors
below this predetermined cut-off generation of a successful leg.  Because this
block can only occur after several generations, we have classified our program
as a "deep generational pay program."

      A distributor must establish personal volume ("PV"), and active legs to
create group volume.  If one person in a leg sells the defined minimum monthly
volume or PV, that leg becomes "active."   To obtain the rank of Captain, a
distributor must have of at least 100 or 150 PV, depending on certain programs
which are available, have three active legs with each generating at least 600
in group volume and have a total group volume of 3,000.   A Team Capatian
requires 100 or 150 PV, three active legs each generating at least 3,000 in
group volume, and a total group volume of 12,000.  An All Star must have the
100 or150 PV, three active legs with 12,000 group volume per leg and a total
group volume of 40,000.  A distributor's rank may vary from month to month
based upon the increase and decrease in his or her monthly volume.

      In addition to the highest levels, we have two lower level distributor
classifications consisting of Team Builder and Team Leader.  To qualify as a
Team Builder, a distributor must have personal monthly purchases totaling over
100 PV units and one "active" 100 PV leg.  A Team Leader is a distributor that
has attained the Team Leader level of 100 PV units in personal purchases and
has established two "active" legs.

      By combining the 2-Infinity Plan with this deep generational pay
program, we believe our Unigen Plan takes the best aspects of each approach
and combines them into a new, more competitive distributor compensation plan.
Several companies have developed and implemented plans similar to ours, such
as Young Living Essential Oils, New Vision and LifeForce International.  We
believe that our approach, while similar to these approaches, improves on
their models and represents a competitive advantage for our distributors.  It
is designed to offer a simple method for a distributor to earn compensation
from development of his or her business.  As the distributor is rewarded
financially, he or she is motivated to continue developing an organization
and, as a result, we continue to grow.

      For management purposes such as product purchasing, sales estimating,
forecasting, and incentive planning, we use a second distributor definition
known as currently "active distributors" which includes those distributors
who, by their recent level of activity, are most likely to purchase products
and sell our products in the near future.  We use the last six months as the
critical time frame within which we classify any distributor who has purchased
any products from us as "active."  As of December 31, 2001 approximately
40,000 of our distributors fell into this category, with 28 distributorships
at the Team Captain level and 13 at the All-Star executive distributor levels,
which are our two highest executive distributor levels.  These
distributorships have extensive downline networks and account for the majority
of our revenue.

      At the present time, it is not possible to quantify the amount of
revenue provided by each type or classification of distributorship.  At this
time we do not have the ability to generate that type of report.  Because our
program is based on monthly sales volume, the amount of revenue generated by
an individual distributor and his down line will vary from month to month
based on the fluctuating activity of the levels below that distributor.

      Sponsoring.  Sponsoring activities are encouraged but not required of
distributors.  While we provide product samples, brochures, magazines,
audiotapes, videotapes, and other sales materials, distributors are primarily
responsible for educating new distributors with respect to our products, the
Unigen Plan and how to build a successful distributorship.  The sponsoring of
new distributors creates multiple levels in the network marketing structure.
Persons whom a distributor sponsors are referred to as "active legs,"
"downline" or "sponsored" distributors.  If downline distributors also sponsor
new distributors, they create additional levels in the structure,

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but their downline distributors remain in the same downline network as their
original sponsoring distributor.

      We promote sponsoring by using a "three-thirty-three" program which
encourages distributors to sponsor at least three new distributors within
thirty days and duplicates that level of sponsorship for three months.  We
believe that most of our distributors attempt, with varying degrees of effort
and success, to sponsor additional distributors because of the financial
incentives provided to those who succeed in building a distributor network
that consumes and resells products.  Generally, distributors invite friends,
family members, and acquaintances to sales meetings, which we call Garden
Parties or "party plans."  Our products are represented and the Unigen Plan is
explained at the Garden Parties.  People are often attracted to become
distributors after using our products and becoming regular retail consumers.
Once a person becomes a distributor, he or she is able to purchase products
directly from us at wholesale prices for resale to consumers at party plans or
for personal consumption.  The distributor is also entitled to sponsor other
distributors in order to build a network of distributors and product users.

      As is typical in the direct selling industry, there is turnover in
distributors from year to year, which requires the sponsoring and training of
new distributors by existing distributors to maintain or increase the overall
distributor force and motivate new and existing distributors.  We may
experience seasonal decreases in distributor sponsoring and product sales
because of holidays and customary vacation periods.  We cannot predict the
timing or degree of fluctuations because of the number of factors that impact
the sponsoring of new distributors, and the fact that we have little control
over the level of sponsorship of new distributors.  We cannot assure that the
number or productivity of our distributors will be sustained at current levels
or increased in the future.

      Our most successful distributors use current technology to increase
their sponsoring activities.  They use lead generation systems which focus on
target databases.  They assist their sales organization in processing and
closing the leads through use of automated voice mail systems, interactive web
sites and other technological tools.
We believe that our distributors will need to adapt their business models to
integrate the Internet into their operations as more and more consumers
purchase goods and services over the Internet instead of through traditional
retail and direct sales channels.

      Compensation.  Each product carries a specified number of bonus volume
points.  Commissions are based on a distributor's personal and group bonus
volume.  A distributor receives commissions based on a percentage of bonus
volume of his or her downline each month.  Bonus volume points are essentially
based upon a percentage of the product's wholesale cost, net of any
point-of-sale taxes.  As a distributor's retail business expands and as he or
she successfully sponsors other distributors into the business, which in turn
expand their own businesses, he or she receives more commissions from downline
sales.  Generally, a distributor can receive commission bonuses only if, on a
monthly basis, (i) the distributor achieves at least 100 points (approximately
$125.00) in personal sales volume, and (ii) the distributor is not in default
of any material policies or procedures.

      Rules Affecting Distributors.  A potential distributor must enter into a
standard distributor agreement which obligates the distributor to abide by our
policies and procedures.  Any person who wishes to can join us as a
distributor to purchase products for personal use or to build a down line
sales organization.  In order to become a distributor, a person must purchase
a Garden Starter Kit which sells for $39.95 in the United States.  The Garden
Starter Kit provides the new distribution with basic literature, a product
video, a "Message of Life" video, product samples, a Pulse Party web site,
training materials, guidelines, order forms, price lists, party plan
information and handouts, and other helpful literature.  The price and
contents of the Garden Starter Kit vary in each of our foreign markets.  The
sale of these materials and other business tools account for 10% of our
revenues.  No distributor is required to purchase a large inventory of
products when he/she starts.  However, in order to receive compensation as a
distributor and thereby become "active," personal monthly purchases/sales are
required.

       Our standard distributor agreement and policies and procedures, which
outline the scope of permissible distributor marketing activities, are posted
on our web site and the compensation plan is provided in every Garden Starter
Kit.  Our distributor rules and guidelines are designed to provide
distributors with maximum flexibility and

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opportunity within the bounds of governmental regulations regarding network
marketing and prudent business policies and procedures.  Distributors are
independent contractors and are thus prohibited from representing themselves
as our agents or as employees of Brain Garden.  Distributors are obligated to
present our products and business opportunity ethically and professionally.
Distributors agree to abide by all local, state and federal laws and
regulations pertaining to the advertising, sale and distribution of our
products.  All advertising must be factual and not misleading and a
distributor will be terminated for making false claims about the income
potential, the compensation plan, or product efficacy.

      Distributors must represent to potential distributors that the receipt
of commissions is based on retail sales and substantial efforts.  Distributors
may not use any form of media advertising to promote products without our
written consent.  Products may be promoted by personal contact or by
literature produced or approved by us.  Products generally may not be sold,
and the business opportunity may not be promoted, in traditional retail
environments.

      We are not in a position to provide the same level of direction,
motivation, and oversight to our distributors as we would our own employees
because the distributors are independent contractors.  We systematically
review alleged reports of distributor misbehavior, but the large number of
distributors and their independent status make it difficult to enforce
distributor policies and procedures.  If we determine that a distributor has
violated any of the distributor policies or procedures, we may either
terminate the distributor's rights completely or impose sanctions such as
warnings, probation, withdraws or denial of an award, suspension of privileges
of a distributorship, withholding commissions until specified conditions are
satisfied, or other appropriate injunctive relief.  To date, no distributors
have been terminated for violation of distributor policies or procedures.  A
distributor may voluntarily terminate his or her distributorship at any time.

Markets

      We provide functional food products which are natural foods that are
eaten to achieve particular effects in the body.  The nutritional supplement
industry (supplements, herbs, etc.) has been flat in recent years while
functional foods has experienced growth.  Based upon our informal review of
our market, we believe the functional foods industry is approximately $10
billion dollars and has experienced growth rates over the past several years
of well over 20% per year.

      Internet.  We include a "Pulse Party" web site with each Garden Starter
Kit.  This web site gives each independent distributor an immediate online
presence and personal URL for their business.  Features on this web site
include company information, flash presentation, online registration of  new
distributors, online product ordering, online customer service and a "contact
me" function that allows anyone visiting the site to contact, via email, the
distributor directly.  Also featured on the Pulse Party site is the BG
Backroom.  This site is exclusively for Brain Garden(TM) distributors and is
password protected.  In the BG Backroom, distributors have access to
up-to-the-minute company news, product tracking, product information, and a
frequently asked questions page, among other things.

      Foreign Markets.  We launched operations in Australia in October 2000
and as of December 31, 2001 we had approximately 20,000 active distributors
there.  In January 2001 our management team toured Japan and held meetings
with potential independent distributors to establish leaders in each of these
cities.  In March 2001, the management team returned to Japan to officially
start the pre-launch phase of Brain Garden Japan.  By Novebmer 2001 we had
completed the necessary procedures to recruit distributors in Japan.
Management anticipates future growth in foreign markets and in the fall of
2001 began business development operations in Korea.

Product Development.

      We are committed to expanding our Whole Foods - Whole Learning - Whole
Living product lines with

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products that are easy to use, easy to sell and which are effective.  During
fiscal year 2001 we did not have costs related to research and development.
However, we anticipate that the launch of our foreign markets will increase
the potential for further research and development of our product lines.  In
addition, we are examining relationships with international banks to supply
online banking services between Whole Living and our foreign distributors.

Competition

      Product Lines.  The market for products designed to enhance mental and
physical performance is large and intensely competitive.  Our primary
competition includes other network marketing companies that manufacture and
market herbal remedies, personal care and nutritional products and educational
products.  We also compete with major retail businesses that provide the same
types of products that we offer.  We compete with these other companies by
emphasizing our uniqueness, the effectiveness and quality of our products and
the convenience of our distribution system.  We emphasize products that
improve health through a diet of real food rather than pills and supplements.
All of our products are and will be 100% natural and to the extent possible,
organic.  Also, our educational products are significantly different than most
offered by our competitors because they emphasize imagination rather than rote
learning.

      Our Whole Foods snack products compete with "health bars" and
nutritional supplements offered by companies such as Amway, Nu Skin
Enterprises, Inc., Nature's Sunshine Products and Shaklee.  Big Planet and
Amway offer educational products which compete with our Whole Learning product
line.  Nu Skin, Amway and Young Living Essential Oils dominate the essential
oils and personal care product market for our Whole Living products.

      Many of our competitors have much greater name recognition and financial
resources.  In addition, herbal remedies, personal care and nutritional
products can be purchased in a wide variety of channels of distribution.
While we believe that consumers appreciate the convenience of ordering
products from home through a sales person or through a catalog, the buying
habits of many consumers accustomed to purchasing products through traditional
retail channels are difficult to change.  Our product offerings in each
product category are also relatively small compared to the wide variety of
products offered by our competitors.

      Network Marketing Companies.  We also compete for distributors with
other direct selling organizations, many of which have a longer operating
history and higher visibility, name recognition, and financial resources.  The
dominant network marketing companies in our existing markets are Amway
Corporation and Nu Skin Enterprises,  Inc.  We also compete with many smaller
network marketing companies who offer personal care products.  We compete for
new distributors on the strength of our product line, compensation plan and
management strength.  Management envisions the entry of many more direct
selling organizations into the marketplace as we believe, this channel of
distribution expands over the next several years.

Raw Materials and Suppliers

      During the fiscal year 2001, a majority of our products were produced by
manufacturers unaffiliated with us and the products were produced according to
specifications provided by us or developed by the manufacturers for us.  Then
in January 2002 we began to manufacture all of our Whole Food snack products
and weight loss products in house.

      During 2001 we used approximately twelve major suppliers and vendors for
food ingredients, packaging, and printing.  Future 500 Corporation, a food
processing and packaging company (the "Future 500") and Jensen's Choice Foods
located in Huntingdale, Victoria, Australia, supplied approximately 75% of our
food products.  In September 1999 we renegotiated our contract with Future 500
which required Future 500 to provide us with fresh food products manufactured
to our specifications.  In March 2001 we engaged Jensen's Fine Foods as a
supplier of

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our pulse food products in our Australian and Japan market.

      Since our shift to in-house manufacturing in 2002, we no longer use
Future 500 Corporation or Jensen's Choice Foods.  We have more freedom to use
any supplier we wish, which gives us more control over our product costs,
quality and the time line for deliver.  We may purchase our raw materials from
several different sources and most of the raw materials we use are readily
available in the market place.  We maintain our product inventory using a
system in which we keep a 4-8 week inventory based on the product's
anticipated movement.

Trademarks, Patents and Intellectual Property

      We have secured trademark protection for Brain Garden(TM).  We are in
the process of securing trademarks for our Brain Garden logo, Sol Saltz,
Earthborn Creations, Daniel's Pulse and are considering protection for several
other product names. We consider our trademark protection to be very important
to brand name recognition and distributor and consumer loyalty to our
business.  We intend to register our important trademarks in the United
States.  In addition, a number of our products utilize proprietary
formulations, but we do not own any patents for these products.

Government Regulations

      Direct Selling Activities.  Direct selling activities are regulated by
various federal, state and local governmental agencies in the United States
and foreign countries.  We believe that our method of distribution is in
compliance in all material respects with the laws and regulations relating to
direct selling activities in the United States, Canada, Australia and Japan.
These laws and regulations are generally intended to prevent fraudulent or
deceptive schemes, often referred to as "pyramid," "money games," "business
opportunity" or "chain sales" schemes, that promise quick rewards for little
or no effort, require high entry costs, use high pressure recruiting methods,
and/or do not involve legitimate products.  The laws and regulations in our
current markets often (i) impose certain cancellation/product return,
inventory buy-backs and "cooling-off" rights for consumers and distributors,
(ii) require us or our distributors to register with the governmental agency,
(iii) impose certain requirements on us, and/or (iv) impose various
requirements, such as requiring distributors to have certain levels of retail
sales to qualify to receive commissions.  The purpose of these laws and
regulations is to ensure that distributors are being compensated for sales of
products and not for recruitment of new distributors.  The extent and
provisions of these laws vary from state to state and internationally.
International laws may impose significant restrictions and limitations on our
business operations.  For example, in Canada and Japan the government does not
allow distributors to purchase product for resale.  All products purchased by
consumers in these countries must be purchased for personal use only.

      Any assertion or determination that we are not in compliance with
existing laws or regulations, could potentially have a material adverse effect
on our business and results of operations.  We cannot assure that regulatory
authorities in our existing markets will not impose new legislation or change
existing legislation that might adversely affect our business in those
markets.  Also, we cannot assure that new judicial interpretations of existing
law will not be issued that adversely affects our business.  Regulatory
action, whether or not it results in a final determination adverse to us, has
the potential to create negative publicity, with detrimental effects on the
motivation and recruitment of distributors and, consequently, on our revenue
and net income.

      Regulation of Personal Care and Nutritional Food Products.  Our products
and related marketing and advertising are subject to governmental regulation
by various domestic agencies and authorities, including the Food and Drug
Administration who regulates food, medical products and cosmetics.  The
advertising and marketing of our products are regulated by the Federal Trade
Commission which enforces consumer protection laws in regards to truth in
advertising.  The Consumer Product Safety Commission protects the public from
unreasonable risk of injuries and death associated with consumer products, and
the United States Department of Agriculture regulates food safety and quality.
Similar types of agencies exist in our foreign markets. To date, we

                                10
<PAGE>

have not experienced any complications regarding health and safety and food
and drug regulations for our products.

      Our markets have regulations concerning product formulation, labeling
and packaging.  These laws and regulations often require us to, among other
things, conform product labeling to the regulations, and register or qualify
products with the applicable government authority or obtain necessary
approvals or file necessary notifications for the marketing of such products.
Many of our existing markets also regulate product claims and advertising.
These laws regulate the types of claims and representations that can be made
regarding the capabilities of products.  For example, in the United States we
are unable to make any claim that our whole foods will diagnose, cure,
mitigate, treat, or prevent disease.

Employees

      We have 42 full time employees and 5 part-time employees in the United
States, Australia and Japan.  Nine of these employees directly support the
distributor network.  We do not anticipate increasing the number of employees
at this time.  However, if we experience significant growth, we may be
required to hire new employees as necessary.  Our employees are not presently
covered by any collective bargaining agreement.  We believe our relationships
with our employees are good and we have not experienced any work stoppages.


                        ITEM 2: PROPERTIES

      We lease 8,122 square feet of office space from KL Partners American
Fork II, LLC.  The office space is located in an office park in American Fork,
Utah.  The term of the lease is for 30 months and expires on July 31, 2002.
We pay a minimum monthly fee of $12,317 for such lease.


                    ITEM 3: LEGAL PROCEEDINGS

      We are involved in various disputes and legal claims arising in the
normal course of our business.  In the opinion of management any resulting
litigation will not have a material effect on our financial position and
results of operations.


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

      We have not submitted a matter to a vote of our shareholders during the
fourth quarter of the 2001 fiscal year.


                             PART II

 ITEM 5: MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET INFORMATION

      Our common stock is listed on the NASD OTC Bulletin Board under the
symbol "WLIV."  The following table represents the range of the high and low
bid prices, converted to decimals, of our stock as reported by the Nasdaq
Trading and Market Services for the past two fiscal years.  These quotations
represent prices between dealers and may not include retail markups,
markdowns, or commissions and may not necessarily represent actual
transactions. We cannot ensure that an active public market will develop in
our common stock or that a
                                11
<PAGE>

shareholder may be able to liquidate his investment without considerable
delay, if at all.

            Year        Quarter Ended           High            Low
           -------      --------------        --------        --------
            2000        March 31              $ 5.00            $ 2.50
                        June 30                 3.75              1.00
                        September 30            3.00              0.75
                        December 31             2.13              0.56

            2001        March 31              $ 0.81            $ 0.38
                        June 30                 0.53              0.26
                        September 30            1.10              0.30
                        December 31             0.77              0.36

      As of April 10, 2002, we had approximately 112 shareholders of record,
with 24,044,360 common shares outstanding.  As of that date, 4,797,383 shares
were restricted securities, as that term is defined by Rule 144, and
19,246,957 shares were unrestricted.

      Our shares are subject to section 15(g) and rule 15g-9 of the Securities
and Exchange Act, commonly referred to as the "penny stock" rule.  The rule
defines penny stock to be any equity security that has a market price less
than $5.00 per share, subject to certain exceptions.  The rule provides that
any equity security is considered to be a penny stock unless that security is:
registered and traded on a national securities exchange meeting specified
criteria set by the SEC; authorized for quotation from the NASDAQ stock
market; issued by a registered investment company; excluded from the
definition on the basis of price   at least $5.00 per share   or the issuer's
net tangible assets.  If our shares are deemed to be a penny stock, trading in
the shares will be subject to additional sales practice requirements on
broker-dealers who sell penny stocks to persons other than established
customers and accredited investors.  Accredited investors, in general, include
individuals with assets in excess of $1,000,000 or annual income exceeding
$200,000 or $300,000 together with their spouse, and certain institutional
investors.

      For transactions covered by these rules, broker-dealers must make a
special suitability determination for the purchase of such security and must
have received the purchaser's written consent to the transaction prior to the
purchase.  Additionally, for any transaction involving a penny stock, the
rules require the delivery, prior to the first transaction, of a risk
disclosure document relating to the penny stock.  A broker-dealer also must
disclose the commissions payable to both the broker-dealer and the registered
representative, and current quotations for the security.  Finally, monthly
statements must be sent disclosing recent price information for the penny
stocks.  Consequently, these rules may restrict the ability of broker-dealers
to trade or maintain a market in our common stock and may affect the ability
of shareholders to sell their shares.

Dividends

      We have not paid cash or stock dividends and have no present plan to pay
any dividends, intending instead to reinvest our earnings, if any.  For the
foreseeable future, we expect to retain any earnings to finance the operation
and expansion of our business.  In addition, it is anticipated that the terms
of future debt and/or equity financing may restrict the payment of cash
dividends.  Therefore, the payment of any cash dividends on the common stock
is unlikely.  However, payment of future dividends will be determined from
time to time by our board of directors, based upon our future earnings,
financial condition, capital requirements and other factors.  We are not
presently subject to any restriction on our present or future liability to pay
any dividends.

Recent Sales of Unregistered Securities

      The following discussion describes all securities sold by us within the
past three years without registration:


                                12
<PAGE>
      On January 14, 2002 we issued an aggregate of 40,000 common shares to
three individuals.  We issued 10,000 shares to Daniel Penoel for consulting
services valued at approximately $2,500. We issued 5,000 common shares valued
at approximately $1,250 to Chris Neville as compensation for services rendered
to Brain Garden Australia.  Richard F. Wogksch received 25,000 shares valued
at $6,250 as severance compensation.  We relied on an exemption from
registration for a private transaction not involving a public distribution
provided by Section 4(2) under the Securities Act.

      On October 15, 2001 we granted options to thirteen employees to purchase
an aggregate of 350,000 common shares at an exercise price of $0.50.  The
options expire October 15, 2004.   We relied on an exemption from registration
for a private transaction not involving a public distribution provided by
Section 4(2) under the Securities Act.

      On September 20, 2001 we granted options to purchase an aggregate of
875,000 common shares at $0.50 per share to five members of our senior
management.  The options expire September 20, 2006.  We relied on an exemption
from registration for a private transaction not involving a public
distribution provided by Section 4(2) under the Securities Act.

      On September 10, 2001 we granted options to purchase an aggregate of
370,000 common shares at an exercise price of $0.50 to eleven employees as
compensation.  The options expire September 10, 2004.  We relied on an
exemption from registration for a private transaction not involving a public
distribution provided by Section 4(2) under the Securities Act.

      On August 14, 2001 we issued 70,000 common shares to Donald R. Mayer,
President of Universal Business Insurance to cancel a debt owed to that
company in the amount of $49,000.  We relied on an exemption from registration
for a private transaction not involving a public distribution provided by
Section 4(2) under the Securities Act.

      On July 12, 2001 we granted options to purchase an aggregate of 750,000
common shares to senior management.  We granted options to purchase 300,000
shares to Ronald K. Williams, options to purchase 200,000 shares to Douglas J.
Burdick, options to purchase 150,000 shares to Sharmon Smith, options to
purchase 50,000 shares to Danny Erickson and options to purchase 50,000 shares
to John Hunter.  We relied on an exemption from registration for a private
transaction not involving a public distribution provided by Section 4(2) under
the Securities Act.

      On July 12, 2001, we issued 400,000 common shares to Mountain View
Investments and Consulting, L.C. in consideration for consulting services
valued at approximately $172,000.  We relied on an exemption from registration
for a private transaction not involving a public distribution provided by
Section 4(2) under the Securities Act.

      On July 5, 2001 we issued 200,000 common shares to Daniel W. Jackson in
consideration for legal services valued at $86,000.  We relied on an exemption
from registration for a private transaction not involving a public
distribution provided by Section 4(2) under the Securities Act.

      On June 18, 2001, we issued 150,000 common shares, valued at $48,000, to
Don Tolman for business consulting services rendered.  We relied on an
exemption from registration for a private transaction not involving a public
distribution provided by Section 4(2) under the Securities Act.

      On June 14, 2001, we issued 40,000 common shares, valued at $12,800 to
Doug Burdick in consideration for business consulting services.  We relied on
an exemption from registration under the Securities Act provided by Section
4(2) as a private transaction not involving a public distribution.

                                13
<PAGE>

      On May 15, 2001, we sold an aggregate of 7,500,000 common shares to six
investors for $2,550,000.  We relied on an exemption from registration under
the Securities Act provided by Section 4(2) as a private transaction not
involving a public distribution.

      Starting February 15, 2001, our Board authorized the sale of our common
shares in a limited offering.  During February and March our Board authorized
the issuance of an aggregate of 6,677,230 common shares to eight accredited
investors for conversion of debt and cash valued at approximately $2,003,169.
We relied on an exemption from the registration requirements of the Securities
Act of 1933 provided by Section 3(b) and Regulation D as a Rule 505 limited
offering.  The aggregate offering was for no more than $5 million in a twelve
month period.

      On January 8, 2001, we issued 250,000 common shares valued at
approximately $125,000 to Mutual Ventures Corporation in consideration for
business consulting services.  On that same date we issued 50,000 common
shares to Daniel W. Jackson in consideration for legal services valued at
approximately $25,000.  We relied on an exemption from registration under the
Securities Act provided by Section 4(2) as a private transaction not involving
a public distribution.

      On February 8, 2001, we issued 500 shares valued at $250 to Bill Church
for services rendered under a distributor agreement.  We relied on an
exemption from registration under the Securities Act provided by Section 4(2)
as a private transaction not involving a public distribution.

      On November 27, 2000, we issued 500 shares valued at $500 to Harry
Collins pursuant to a distributor agreement.  We relied on an exemption from
the registration requirements of the Securities Act of 1933 by reason of
Section 4(2) as a private transaction not involving a public distribution.

      On September 13, 2000 we granted warrants to purchase 800,000 common
shares to Columbia Financial Group, Inc. in consideration for investor
relations services.  The warrants were valued at $272,000 in 2001 when the
services were performed, have an exercise price of $2.00, later reduced to
$0.50, and expire through September 2005.  We relied on an exemption from the
registration requirements of the Securities Act of 1933 by reason of Section
4(2) as a private transaction not involving a public distribution.

      On September 11, 2000, we issued an aggregate of 235,000 common shares
valued at $235,000 to three independent distributors pursuant to distributor
agreements.   We issued 75,000 shares to Earl Shaw, 85,000 shares to Dennis
Windsor and 75,000 shares to Dwight Johnson.  We relied on an exemption from
the registration requirements of the Securities Act of 1933 by reason of
Section 4(2) as a private transaction not involving a public distribution.

      On August 1, 2000, we issued 35,000 common shares to Donald Mayer,
President of Universal Business Insurance to cancel a debt of $23,500 payable
to Universal Business Insurance.  We relied on an exemption from the
registration requirements of the Securities Act of 1933 by reason of Section
4(2) as a private transaction not involving a public distribution.

      On July 21, 2000, we issued 1,200,000 common shares valued at $600,000
to Development Specialties, Inc. to satisfy a note payable.  We relied on an
exemption from the registration requirements of the Securities Act of 1933 by
reason of Section 4(2) as a private transaction not involving a public
distribution.

      On July 21, 2000, we issued 800,000 shares valued at $400,000 to Capital
Communications, Inc. to satisfy a note payable.  We relied on an exemption
from the registration requirements of the Securities Act of 1933 by reason of
Section 4(2) as a private transaction not involving a public distribution.

      In March 2000 we issued 400,000 common shares to SGS Holdings, LLC for
debt conversion of $500,000

                                14
<PAGE>

cash.  We relied on an exemption from the registration requirements of the
Securities Act of 1933 by reason of Section 4(2) as a private transaction not
involving a public distribution.

      In September of 1999, we issued 10,000 common shares, valued at $15,000,
to Universal Business Insurance in consideration for an insurance policy.  We
relied on an exemption from the registration requirements of the Securities
Act of 1933 by reason of Section 4(2) as a private transaction not involving a
public distribution.

      On July 13, 1999, we issued 400,000 common shares to SGS Holdings, LLC
to satisfy certain promissory notes, with interest, of $207,958.  We relied on
an exemption from the registration requirements of the Securities Act of 1933
by reason of Section 4(2) as a private transaction not involving a public
distribution.

      In connection with the issuance of our securities, we believe that the
purchaser (i) was aware that the securities had not been registered under
federal securities laws, (ii) acquired the securities for his/her/its own
account for investment purposes and not with a view to or for resale in
connection with any distribution for purpose of the federal securities laws,
(iii) understood that the securities would need to be indefinitely held unless
registered or an exemption from registration applied to a proposed disposition
and (iv) was aware that the certificate representing the securities would bear
a legend restricting their transfer.  We believe that, in light of the
foregoing, the sale of our securities to the acquirer did not constitute the
sale of an unregistered security in violation of the federal securities laws
and regulations by reason of the exemptions provided under  3(b) and 4(2) of
the Securities Act, and the rules and regulations promulgated thereunder.


           ITEM 6: MANAGEMENT'S DISCUSSION AND ANALYSIS

      Generally, we have recorded operating losses for the most recent two
fiscal years and at the year ended December 31, 2001 we had an accumulated
deficit of $7,842,330.  Our independent auditors have expressed an opinion
that we may be unable to continue as a going concern without financing.
However, we plan to raise capital though public markets and to aggressively
market our products.

      Generally, we recognize revenue upon the receipt of the sales order,
which is simultaneous with the payment and delivery of such goods.  Revenue is
net of returns, which have historically been less than 1% of sales.
Distributor commissions are paid to several levels of distributors on each
product sale.  The amount and recipient of the commission varies depending on
the purchaser's position within the Unigen Plan.  (See "Business -
Distribution Network," below.)  Distributor commissions are paid to
distributors on a monthly basis based upon their personal and group sales
volume. Additional bonuses are paid weekly to distributors.  The overall
payout average has been approximately 41% of product sales.

Reverse Merger Treatment

      In May of 1999 Whole Living merged with Whole Living, Inc., a Utah
corporation, doing business as Brain Garden(TM)  ("Whole Living Utah").  Whole
Living, the Nevada corporation, was the surviving entity following the
statutory merger.  The merger was accounted for as a "reverse merger" and the
accounting survivor is Whole Living Utah.  The reverse merger was completed
through a tax free stock-for-stock exchange of 6,000,000 shares of the Whole
Living's common stock for all the outstanding stock of Whole Living Utah.  For
accounting purposes, Whole Living was acquired for approximately 4.3 million
shares in exchange for $800,000 of its net monetary assets, $650,000 of which
were advances due from Whole Living Utah.  The merger provided cash necessary
to support the operations of Whole Living Utah prior to the merger and the
operations of Whole Living after the merger.

                                15
<PAGE>

Results of Operations

      The following table summarizes operations for the three month periods
ended March 31, 2001 and 2000 and the fiscal year ended December 31, 2001 and
2000.


                                                    Year ended December 31,
                                                      2001          2000
                                                  ------------- -------------
Revenues                                          $  5,965,325  $  5,198,835
Cost of Sales                                        4,339,104     3,881,351
                                                  ------------- -------------
Gross Profit                                         1,626,221     1,317,484
                                                  ------------- -------------

Selling Expense                                        952,714       898,143
General & Administrative                             4,625,766     2,536,985
                                                  ------------- -------------
   Total Operating Expense                           5,578,480     3,435,128
                                                  ------------- -------------

Operating Income (Loss)                             (3,952,259)   (2,117,644)
                                                  ------------- -------------

Total Other Income (Expense)                           (14,138)       (4,149)
                                                  ------------- -------------

Net Income (Loss)                                 $ (3,966,397) $ (2,121,793)
                                                  ============= =============

Net Loss per share                                $     ( 0.20) $      (0.18)


YEARS ENDED DECEMBER 31, 2001 AND 2000

      Sales increased $766,490 for the 2001 year compared to the 2000 year.
The increased revenues were a result of the development of our distributor
network, particularly the expansion of our distributor network into Japan in
the last half of the 2001 fiscal year.

      Cost of sales consists primarily of the cost of procuring and packaging
products and sales commissions to our independent distributors, the cost of
shipping product to distributors in Australia, plus credit card sales
processing fees.  Cost of sales increased $457,753 for the 2001 year compared
to the 2000 year.  They were 72.7% of sales for the 2001 year compared to
74.7% of sales for the 2000 year. The 2001 year increase was primarily the
result of the implementation of the company-wide "Retail Bonus Pool"
commission plan, which significantly increased our commission payout on sales
to new customers in order to increase the size of our overall customer and
distributor base.  Accordingly, our gross profit increased $308,737 in the
2001 year compared to the 2000 year.

      Selling expenses, which includes marketing expenses, the support of
sales meetings and events, and certain customer service expenses, increased
$54,571 for the 2001year compared to 2000 year.  This increase was primarily
attributable to consulting fees and other expenses for domestic and foreign
market growth during 2001.  Selling expenses for 2001 were 16.0% of sales
compared to 17.3% of sales for 2000.

      General and administrative expenses, which include general office
expense, management and employees' salaries, and the support systems for the
distributor network, increased $2,088,781 for the 2001 year compared to the
2000 year.  These expenses increased because of:  1) start up costs involved
in establishing distribution in Australia and New Zealand; 2) costs attributed
to product manufacturing in Australia and; 3) the increase in the number of
employees and other resources required to service the growth in company
revenues.

      As a result of the above changes in operations, our total operating loss
increased $1,834,615 for 2001 compared to 2000.   The loss was primarily the
result of : 1) increased sales commissions resulting from implementation of
the company's Retail Bonus Plan; and 2) expenses of establishing and preparing
to establish

                                16
<PAGE>

overseas distribution.

      Total other expense increased $9,989 for 2001 compared to 2000.  These
expenses increased primarily as a result of interest expense related to debt
financing.

      Our net loss increased $1,844,604 for 2001compared to 2000. We recorded
a net loss per share of $0.20 for 2001 compared to a loss per share of $0.18
for 2000.  Cash to fund operating losses came primarily from loans.
Management expects operating losses to continue in the next quarter as the
company continues to invest in expansion of its overseas distribution.

YEARS ENDED DECEMBER 31, 2000 AND 1999

      Revenues increased $1,572,900 for the 2000 year from the 1999 year.  The
increased revenues were a result of the development of our distributor
network, particularly the expansion of our distributor network into Australia
and New Zealand in the last half of 2000.

      Cost of sales were 74.7% of revenues for 2000 compared to 73.3% of
revenues for 1999.  Even though we implemented company-wide commission plans,
which significantly increased our commission payout on sales to new customers,
the increase in commissions paid out was offset by the results of better
product procurement in 2000.

      Selling expenses increased $539,707 from 1999 to 2000 and were 17.3% of
revenues in 2000 compared to 9.9% of revenues in 1999.  This increase was
primarily the result of recognizing selling and marketing costs associated
with expanding distribution in Australia and New Zealand, plus additional
costs involved in laying the groundwork for expansion into Japan.  Some
selling and marketing expenses saw a decrease attributable to the
implementation of tighter operating budgets during a period of significant
sales growth.

      Research and development expenses declined from $17,520 in 1999 to a
negligible amount during 2000.

      General and administrative expenses increased $296,672 from 1999 to
2000.  These expenses increased because of:  1) start up costs involved in
establishing distribution in Australia and New Zealand; and, 2) the increase
in the number of employees and other resources required to service the growth
in company revenues.

      Total operating expenses were 66.1% of sales in 2000.  This compares to
72.2% in 1999.  The overall dollar increase of $818,859 in 2000 over 1999 is
summarized in the above discussions.  Primarily, the increase was a result of
expenses involved in:  1) increased sales commissions resulting from
implementation of our new commission plan; and, 2) expenses related to
preparation and the launch of establishing overseas distribution.  The
decrease in the overall per cent of operating expenses to sales from 1999 to
2000 is attributable to management's implementation of tighter departmental
budgets.

      Net losses increased $422,910 from 1999 to 2000 and we recorded a net
loss per share of $(0.18) for the 2000 fiscal year.  Cash to fund operating
losses came primarily through loans from related parties.  Management expects
operating losses to continue into the first quarter of 2001 as we continue to
invest in expansion of our overseas distribution.

Factors Affecting Future Performance

      Since our inception, internal cash flows, alone, have not been
sufficient to maintain our operations.  Our future internal cash flows will be
dependent on a number of factors, including:
      .      Our ability to encourage our distributors to sponsor new
               distributors and increase their own personal sales;


                                17
<PAGE>

      .      Our ability to promote our product lines with our distributors;
      .      Our ability to develop successful new product lines;
      .      Effects of regulatory changes, if any; and
      .      Our ability to remain competitive in our markets.
Actual costs and revenues could vary from the amounts we expect or budget,
possibly materially, and those variations are likely to affect how much
additional financing we will need for our operations.

Seasonal Aspects

      In the direct selling industry, the summer months of June, July and
August, and the holiday months of November and December are relatively soft.
However, in our short operating history we have not experienced a decrease in
sales during these time periods and are unsure how the industry-wide
fluctuations will affect our business in the future.

Liquidity and Capital Resources

      We have funded our cash requirements primarily through sales, loans and
private placements of our common stock. For the year ended December 31, 2001,
we had $96,232 cash on hand with $698,100 in total current assets compared to
no cash on hand and $600,718 total current assets for the year ended December
31, 2000.   Our total current liabilities were $1,393,128 at the 2001 year
compared to total current liabilities of $2,075,383 at the 2000 year.

      As of December 31, 2001, our principal commitments consisted of notes
payable and operating leases. Future minimum payments on notes payable were
$544,453 through 2002.  Future minimum payments on operating leases for
vehicles, office space and warehouse space were $186,285 through 2003.

      Net cash used for operating activities was $2,101,045 at the year ended
December 31, 2001 compared to $1,708,133 for the year ended December 31, 2000.
Net cash used by investing activities was $123,598 for the 2001 year compared
to $363,229 for the 2000 fiscal year.  These investments were primarily
related to equipment and cash paid for deposits.

      Net cash provided by financing activities was $2,320,875 for the 2001
year compared to $1,888,293 for the 2000 fiscal year.  In May 2001we sold
7,500,000 common shares to six accredited investors for $2,550,000 in cash.
During 2001 we received cash from debt financing of $1,990,373 primarily from
shareholders and management.  In addition, during the 2000 year we borrowed
$1,934,049 from related parties.  In February 2001 we issued 6,677,230 shares
to eight accredited investors to convert a portion of these notes payable
totaling $2,004,678.  These loans were primarily from shareholders with
interest rates varying from 9% to 10.5%.  Then on October 15, 2001, our Board
authorized the buy back of 4,052,890 common shares for $1,500,000 from five of
the shareholders.  The Board then retired the shares to the corporate
treasury, reducing our issued and outstanding by that number.

      Management anticipates that additional capital will be provided by
future loans or private placements of our common stock.  We expect to issue
private placements of stock pursuant to exemptions provided by federal and
state securities laws.  The purchasers and manner of issuance will be
determined according to our financial needs and the available exemptions.  We
also note that if we issue more shares of our common stock our shareholders
may experience dilution in the value per share of their common stock.

      If we fail to raise the necessary funds through private placements, we
anticipate we will require debt financing from related or third parties.  We
have not investigated the availability, source and terms for external
financing at this time and we can not assure that funds will be available from
any source, or, if available, that we will be able to obtain the funds on
terms agreeable to us.  Also, the acquisition of funding through the issuance
of

                                18
<PAGE>

debt could result in a substantial portion of our cash flows from operations
being dedicated to the payment of principal and interest on the indebtedness,
and could render us more vulnerable to competitive and economic downturns.

      We have entered into agreements with independent distributors and
suppliers located in Australia, Canada, New Zealand and Japan and may
establish similar arrangements in other countries in the future.  As a result,
our future revenues may be affected by the economies of these countries.


                   ITEM 7: FINANCIAL STATEMENTS


                                19
<PAGE>


















                        WHOLE LIVING, INC.

                CONSOLIDATED FINANCIAL STATEMENTS

                    December 31, 2001 and 2000


<PAGE> 20




                         C O N T E N T S


Auditors' Report........................................................... 3

Consolidated Balance Sheets................................................ 4

Consolidated Statements of Operations...................................... 6

Consolidated Statements of Stockholders' Equity............................ 7

Consolidated Statements of Cash Flows...................................... 8

Notes to the Consolidated Financial Statements............................. 9





<PAGE> 21


                           CHISHOLM & ASSOCIATES
a Professional         Certified Public Accountants      Office (801)292-8756
Corporation                   P.O. Box 540216              Fax (801) 292-8809
                   North Salt Lake, Utah 84054
_____________________________________________________________________________






                   INDEPENDENT AUDITORS' REPORT


To the Board of Directors and Stockholders of
Whole Living, Inc.

We have audited the accompanying consolidated balance sheets of Whole Living,
Inc. as of December 31, 2001 and 2000 and the related consolidated statements
of operations, stockholders' equity and cash flows for the years then ended.
These consolidated financial statements are the responsibility of the
Company's management.  Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.

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

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position
of Whole Living Inc. as of December 31, 2001 and 2000 and the consolidated
results of its operations and cash flows for the years then in conformity with
generally accepted accounting principles in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern.  As discussed in Note 5,
the Company's short operating history and operating losses raise substantial
doubt about its ability to continue as a going concern.  Management's plans in
those matters are also described in Note 5.  The consolidated financial
statements do not include any adjustments that might result from the outcome
of this uncertainty.



/s/ Chisholm & Associates

Chisholm & associates
North Salt Lake, Utah
March 14, 2002

<PAGE> 22

                        WHOLE LIVING, INC.
                   Consolidated Balance Sheets


                              ASSETS

                                                          December 31,
                                                       2001           2000
                                                   ------------- -------------
CURRENT ASSETS

  Cash                                             $     96,232  $          -
  Accounts receivable                                    50,000        13,627
  Receivables - other                                    19,855             -
  Inventory                                             511,846       480,618
  Prepaid expenses                                       20,167       106,473
                                                   ------------- -------------

     Total Current Assets                               698,100       600,718
                                                   ------------- -------------

PROPERTY AND EQUIPMENT, Net                             347,206       472,528
                                                   ------------- -------------

OTHER ASSETS

  Goodwill                                               17,318        25,976
  Distributor lists                                           -        64,600
  Deposits                                               55,010        18,906
                                                   ------------- -------------

     Total Other Assets                                  72,328       109,482
                                                   ------------- -------------

     TOTAL ASSETS                                  $  1,117,634  $  1,182,728
                                                   ============= =============




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


                                4
<PAGE> 23

                        WHOLE LIVING, INC.
             Consolidated Balance Sheets (Continued)


               LIABILITIES AND STOCKHOLDERS' EQUITY

                                                           December 31,
                                                        2001         2000
                                                   ------------- -------------

CURRENT LIABILITIES

  Bank overdraft                                   $          -  $    121,073
  Accounts payable                                      516,308       432,683
  Accrued expenses                                      332,287       244,452
  Current portion of long-term liabilities              544,533     1,277,175
                                                   ------------- -------------

     Total Current Liabilities                        1,393,128     2,075,383
                                                   ------------- -------------

LONG-TERM LIABILITIES

  Notes payable - related party                         544,453     1,274,049
  Capital lease obligations                                  80         3,446
  Less current portion                                 (544,533)   (1,277,175)
                                                   ------------- -------------

     Total Long-Term Liabilities                              -           320
                                                   ------------- -------------

STOCKHOLDERS' EQUITY

  Common stock, authorized 50,000,000 shares
   $0.001 par value, issued and outstanding
   24,004,340 and 13,379,500 shares, respectively        24,005        13,380
  Additional paid-in capital                          7,742,831     2,969,578
  Retained earnings                                  (7,842,330)   (3,875,933)
  Subscription receivable                              (200,000)            -
                                                   ------------- -------------

     Total Stockholders' Equity                        (275,494)     (892,975)
                                                   ------------- -------------

     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY    $  1,117,634  $  1,182,728
                                                   ============= =============





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

                                5
<PAGE> 24

                        WHOLE LIVING, INC.
              Consolidated Statements of Operations


                                                       For the Year Ended
                                                           December 31,
                                                         2001        2000
                                                   ------------- -------------

REVENUES                                           $  5,965,325  $  5,198,835

COST OF SALES                                         4,339,104     3,881,351
                                                   ------------- -------------

GROSS PROFIT                                          1,626,221     1,317,484
                                                   ------------- -------------

SELLING EXPENSES                                        952,714       898,143

GENERAL AND ADMINISTRATIVE EXPENSES                   4,625,766     2,536,985
                                                   ------------- -------------

TOTAL OPERATING EXPENSES                              5,578,480     3,435,128
                                                   ------------- -------------

OPERATING INCOME/(LOSS)                              (3,952,259)   (2,117,644)
                                                   ------------- -------------
OTHER INCOME AND (EXPENSES)

  Interest expense                                      (16,115)      (13,015)
  Interest income                                         1,977         8,866
                                                   ------------- -------------

     Total Other Income and (Expenses)                  (14,138)       (4,149)
                                                   ------------- -------------

INCOME/(LOSS) BEFORE INCOME TAXES                    (3,966,397)   (2,121,793)

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

NET INCOME/(LOSS)                                  $ (3,966,397) $ (2,121,793)
                                                   ============= =============

NET LOSS PER SHARE                                 $      (0.20) $      (0.18)
                                                   ============= =============

WEIGHTED AVERAGE OUTSTANDING SHARES                  21,232,270    12,101,958
                                                   ============= =============


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

                                6
<PAGE> 25
<TABLE>
<CAPTION>

                             WHOLE LIVING, INC.
               Consolidated Statement of Stockholders' Equity
               For the Years Ended December 31, 2001 and 2000


                                                  Additional                  Retained
                              Common Stock          Paid-In    Subscription   Earnings
                          Shares        Amount      Capital     Receivable    (Deficit)
                       ------------- ------------ ------------- - --------- -------------

                    <c>           <c>          <c>           <c>         <c>
Balance,
December 31, 1999        10,709,000  $    10,709  $  1,213,249  $        -  $ (1,754,140)

March 2000 - shares
 issued for conversion
 of notes payable at
 $1.25 per share            400,000          400       499,600           -             -

June 2000 - shares
 issued for conversion
 of notes payable at
 $0.50 per share          2,000,000        2,000       998,000           -             -

August 2000 - shares
 issued for insurance
 policy at $0.67 per
 share                       35,000           35        23,465           -             -

September 2000 - shares
 issued for distributor
 agreements at $1.00
 per share                  235,000          235       234,765           -             -

November 2000 - shares
 issued for stock
 incentive program at
 $1.00 per share                500            1           499           -             -

Net (loss) for the
 year ended
 December 31, 2000                -            -             -           -    (2,121,793)
                       ------------- ------------ ------------- - --------- -------------
Balance,
 December 31, 2000       13,379,500       13,380     2,969,578           -    (3,875,933)

January 2001 - shares
 returned and retired    (1,100,000)      (1,100)        1,100           -             -

January 2001 - shares
 issued for services
 at $0.50 per share         300,000          300       149,700           -             -

February 2001 - shares
 issued for services at
 $0.50 per share                500            1           249           -             -

February 2001 - shares
 issued for conversion
 of notes payable at
 $0.30 per share          6,677,230        6,677     1,998,001           -             -

May 2001 - shares
 issued  for cash at
 $0.34 per share          7,500,000        7,500     2,542,500           -             -

June 2001 - shares
 issued for services
 at $0.32 per share         190,000          190        60,610           -             -
                       ------------- ------------ ------------- - --------- -------------

Balance Forward          26,947,230  $    26,948  $  7,721,738  $        -  $ (3,875,933)
                       ------------- ------------ ------------- - --------- -------------



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

                                     7
</TABLE>
<PAGE> 26
<TABLE>
<CAPTION>
                             WHOLE LIVING, INC.
         Consolidated Statement of Stockholders' Equity (Continued)
               For the Years Ended December 31, 2001 and 2000


                                                  Additional                  Retained
                              Common Stock          Paid-In    Subscription   Earnings
                          Shares        Amount      Capital     Receivable    (Deficit)
                       ------------- ------------ ------------- - --------- -------------

                    <c>           <c>          <c>           <c>         <c>
Balance Forward          26,947,230  $    26,948  $  7,721,738  $        -  $ (3,875,933)

July 2001 - shares
 purchased and retired
 at $0.37 per share      (4,052,890)      (4,053)   (1,495,947)          -             -

July 2001 - shares
 issued for services
 at $0.43 per share         600,000          600       257,400           -             -

August 2001 - shares
 issued for services
 at $0.70 per share          70,000           70        48,930           -             -

October 2001 - shares
 issued for services at
 $0.60 per share             40,000           40        23,960           -             -

November 2001 - shares
 issued for cash at
 $0.50 per share            400,000          400       199,600    (200,000)            -

Stock options expense
 for 2001                         -            -       715,150           -             -

Warrant expense for 2001          -            -       272,000           -             -

Net loss for the year
ended December 31, 2001           -            -             -           -    (3,966,397)
                       ------------- ------------ ------------- - --------- -------------
Balance,
 December 31, 2001       24,004,340  $    24,005  $  7,742,831  $ (200,000) $ (7,842,330)
                       ============= ============ ============= =========== =============


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


                                     8
</TABLE>
<PAGE> 27
<TABLE>
<CAPTION>

                             WHOLE LIVING, INC.
                   Consolidated Statements of Cash Flows


                                                                 For the Year Ended
                                                                    December 31,
                                                                  2001        2000
                                                             ------------- ------------
<S>                                                          <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES

  Net income (loss)                                          $ (3,966,397) $(2,121,793)
  Non-cash items:
     Depreciation and amortization                                286,915      122,845
     Stock issued for services                                    542,050      259,000
     Options issued for services                                  715,150            -
     Warrants issued for services                                 272,000            -
  (Increase)/decrease in current assets:
     Accounts receivable                                          (56,228)     (11,079)
     Inventory                                                    (31,228)    (125,536)
     Prepaid expenses                                              86,306      (59,744)
  Increase/ (decrease) in current liabilities:
     Bank overdraft                                              (121,073)     121,073
     Accounts payable                                              83,625      104,205
     Accrued expenses                                              87,835        2,896
                                                             ------------- ------------

       Net Cash Provided (Used) by Operating Activities        (2,101,045)  (1,708,133)
                                                             ------------- ------------

CASH FLOWS FROM INVESTING ACTIVITIES

  Cash paid for property and equipment                            (87,494)    (290,729)
  Cash paid for distributor lists                                       -      (65,100)
  Cash paid for deposits                                          (36,104)      (7,400)
                                                             ------------- ------------

       Net Cash Provided (Used) by Investing Activities          (123,598)    (363,229)
                                                             ------------- ------------

CASH FLOWS FROM FINANCING ACTIVITIES

  Cash paid for treasury stock                                 (1,500,000)           -
  Cash received from issuance of common stock                   2,550,000            -
  Cash received from debt financing                             1,990,373    1,934,049
  Cash paid on principal of long-term debt                       (719,498)     (45,756)
                                                             ------------- ------------

       Net Cash Provided (Used) by Investing Activities         2,320,875    1,888,293
                                                             ------------- ------------

INCREASE (DECREASE) IN CASH                                        96,232     (183,069)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                        -      183,069
                                                             ------------- ------------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                   $     96,232  $         -
                                                             ============= ============





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


                                     9
</TABLE>
<PAGE> 28
<TABLE>
<CAPTION>

                             WHOLE LIVING, INC.
             Consolidated Statements of Cash Flows (Continued)


                                                                For the Year Ended
                                                                    December 31,
                                                                  2001        2000
                                                             ------------- ------------
<S>                                                          <C>           <C>

SUPPLEMENTAL CASH FLOW INFORMATION:

  Interest                                                   $          -  $       567
  Income taxes                                               $          -  $         -

NON-CASH FINANCING TRANSACTIONS

  Stock issued for services                                  $    542,050  $   295,000
  Stock issued for conversion of notes payable               $  2,004,678  $ 1,500,000
  Stock options issued for services                          $    715,150  $         -
  Warrants issued for services                               $    272,000  $         -



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


                                     10

</TABLE>
<PAGE> 29



                        WHOLE LIVING, INC.
          Notes to the Consolidated financial Statements
                    December 31, 2001 and 2000


NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     a.  Organization

     Whole Living, Inc. (the Company) was incorporated on November 25, 1998 in
the state of Utah.  On November 30, 1998, the Company acquired the assets,
leases, product line and name of Brain Garden, L.L.C., a Utah limited
liability company engaged in the marketing and distribution of various natural
food products, oils and bath salts.  The Company does business under the name
of Brain Garden, and maintains its headquarters in American Fork, Utah.

     On November 30, 1998, the Company acquired many of the assets, lease
obligations and much of the product line of Brain Garden.  The acquisition was
recorded using the purchase method of a business combination.  Goodwill was
recorded in the acquisition in the amount of $43,294 and will be amortized
over 60 months.  The Company paid $283,800 for the purchase of Brain Garden
assets.  The Company assumed leases in the amount of $14,500.  The Company
also assumed an operating lease for office space which expired during 1999.

     On May 24, 1999 the Company entered into an agreement to merge with Whole
Living, Inc. a Nevada Corporation (WLN) which is a non-operating public
company with cash of $150,000 and a note receivable of $650,000 from Whole
Living, Inc. (Utah) for funds advanced in contemplation of the merger.
Pursuant to the merger, WLN issued 6,000,000 shares of common stock to the
shareholders of the Company for all outstanding stock of the Company.  The
merger was recorded as a reverse merger, with Whole Living, Inc. (Utah) being
the accounting survivor.  A reverse merger adjustment was made to the books of
the Company to reflect the change in capital to that of WLN.  No goodwill or
intangible assets were recorded in the reverse acquisition.

     b.  Recognition of Revenue

     The Company recognizes income and expense on the accrual basis of
accounting.

     The Company's source of revenue is from the sale of various food products
and other natural products.  The Company recognizes the sale upon receipt of
the sales order, which is simultaneous with the payment and delivery of such
goods.  The Company offers a 100% satisfaction guarantee against defects for
30 days after the sale of their product.  The Company extends this return
policy to its distributors for a 30 day period and the consumer has the same
return policy in effect against the distributor.  Returns are approximately 1%
of sales for both periods presented.  All conditions of FASB 48 are met and
the revenue is recorded upon sale, with an estimated accrual for returns.  The
Company has no sources of comprehensive income.

     c.  Principles of Consolidation

     The December 31, 2001 and 2000 financial statements include the books of
Whole Living, Inc. (Nevada) and its wholly owned subsidiary Whole Living, Inc.
(Utah).  All intercompany transactions and balances have been eliminated in
the consolidation.

                                11
<PAGE> 30

                        WHOLE LIVING, INC.
          Notes to the Consolidated financial Statements
                    December 31, 2001 and 2000

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     d.  Earnings (Loss) Per Share

     The computation of earnings per share of common stock is based on the
weighted average number of shares outstanding at the date of the financial
statements.


                                         Income(loss)   Shares       Per-Share
                                         (Numerator)   (Denominator)  Amount
                                          ------------- ------------- --------
    For the year ended December 31, 2001:

          Basic EPS
            Income (loss) to common
            stockholders                  $ (3,966,397)   21,232,270  $ (0.20)
                                          ============= ============= ========
    For the year ended December 31, 2000:

          Basic EPS
            Income (loss) to common
            stockholders                  $ (2,121,793)   12,101,958  $ (0.18)
                                          ============= ============= ========

      There are no reconciling items to net income for the computation of
earnings per share.  At December 31, 2001 and 2000, the stock options and
warrants granted were not included in computing diluted earnings per share
because their effects are anti-dilutive.

     e.  Provision for Income Taxes

     No provision for income taxes has been recorded due to net operating loss
carryforwards totaling approximately $7,842,330 that will be offset against
future taxable income.  Since the Company has yet to prove they can generate
taxable income, a valuation account has been created to eliminate the deferred
tax asset.

     Deferred tax assets and the valuation account is as follows at December
31, 2001 and 2000:
                                                       December 31,
                                                   2001           2000
                                               ------------- -------------
     Deferred tax asset:
        NOL carryforward                       $  2,666,392  $  1,317,000
        Valuation allowance                      (2,666,392)   (1,317,000)
                                               ------------- -------------
                                               $          -  $          -
                                               ============= =============

     f.  Cash and Cash Equivalents

     The company considers all highly liquid investments with maturities of
three months or less to be cash equivalents.

                                12

<PAGE> 31

                        WHOLE LIVING, INC.
          Notes to the Consolidated financial Statements
                    December 31, 2001 and 2000

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     g.  Property and Equipment

     Expenditures for property and equipment and for renewals and
betterments, which extend the originally estimated economic life of assets or
convert the assets to a new use, are capitalized at cost. Expenditures for
maintenance, repairs and other renewals of items are charged to expense. When
items are disposed of, the cost and accumulated depreciation are eliminated
from the accounts, and any gain or loss is included in the results of
operations.

     The provision for depreciation is calculated using the straight-line
method over the estimated useful lives of the assets.  Depreciation expense
for the period ended  December 31, 2001 and 2000 is $227,136 and $113,686,
respectively.

     In accordance with Financial Accounting Standards Board Statement No.121,
the Company records impairment of long-lived assets to be held and used or to
be disposed of when indicators of impairment are present and the undiscounted
cash flows estimated to be generated by those assets are less than the
carrying amount.  At December 31, 2001 and 2000, no impairments were
recognized.

     h.  Inventory

     Inventory is recorded at the lower of cost or market and valued on a
first-in, first-out basis. Inventory consists primarily of consumable food
products and ingredients.

     i.  Fair Value of Financial Instruments

     Unless otherwise indicated, the fair values of all reported assets and
liabilities which represent financial instruments (none of which are held for
trading purposes) approximate the carrying values of such amounts.

     j.  Goodwill

     The Company recorded goodwill in the acquisition of the assets of Brain
Garden, LLC.  Various intangible assets such as distributor down lines,
customer lists and product name identification are included in Goodwill.
Valuation of these intangibles separately was not identified, yet the excess
of payment over the net assets received provides for the recording of these
intangibles as Goodwill.  Goodwill is being amortized over 5 years on a
straight-line method.  Amortization expense for the years ended December 31,
2001 and 2000 was $8,659 and $9,159, respectively.

     k.  Use of Estimates

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make assumptions that
affect the amounts reported in the financial statements and accompanying
notes.  In these financial statements,


                                13
<PAGE> 32

                        WHOLE LIVING, INC.
          Notes to the Consolidated financial Statements
                    December 31, 2001 and 2000


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

     k.  Use of Estimates (continued)

assets, liabilities and earnings involve extensive reliance on managements
estimates.  actual results could differ from those estimates.

NOTE 2 - PROPERTY AND EQUIPMENT

     Property and equipment consists of the following at December 31, 2001 and
2000:

                                                      December 31,
                                                     2001       2000
                                                ------------- ------------

         Office equipment & furnishings         $    128,238  $    94,187
         Office furniture & fixtures                  61,111       61,111
         Software                                    519,584      472,140
         Leased equipment                             15,014       15,014
                                                ------------- ------------
                                                     723,947      642,452
         Less:
          Accumulated depreciation                  (365,485)    (163,674)
          Accumulated depreciation -
           leased equipment                          (11,256)      (6,250)
                                                ------------- ------------

         Total Property & Equipment             $    347,206  $   472,528
                                                ============= ============

NOTE 3 - LONG-TERM LIABILITIES

     Long Term Liabilities are detailed in the following schedules as of
December 31, 2000 and 1999:

     Notes payable - related party is detailed as follows:


                                                          December 31,
                                                       2001          2000
                                                   ------------- ------------
     Note payable to a shareholder of the Company,
      bearing interest at 14%, due upon demand and
      unsecured                                    $          -  $   771,630

     Note payable to a shareholder of the Company,
      bearing interest at 15%, due upon demand
      and unsecured.                                    540,000            -

     Note payable to a shareholder of the Company,
     bearing interest at 10.5%, due upon demand
     and unsecured                                        4,453      409,305

     Note payable to a corporation under common
     ownership, non-interest bearing, due upon
     demand and unsecured                                     -       93,114
                                                   ------------- ------------

     Total notes payable - related party           $    544,453  $ 1,274,049
                                                   ============= ============


                                14
<PAGE> 33


                        WHOLE LIVING, INC.
          Notes to the Consolidated Financial Statements
                    December 31, 2001 and 2000


NOTE 3 - LONG-TERM LIABILITIES (CONTINUED)

     Capital lease obligations are detailed in the following schedule as of
December 31, 2001 and 2000:
                                                          December 31,
                                                        2001       2000
                                                   ------------- ------------

     Capital lease obligation to a corporation
     for computer equipment, lease payments
     due monthly of $304 through April 2002,
     bears interest at 18%, secured by equipment.            80        3,446
                                                   ------------- ------------
     Total Lease Obligations                                 80        3,446
                                                   ------------- ------------
     Total long term liabilities                        544,533    1,277,495
                                                   ============= ============

     Less current portion of:
       Notes payable - related party                    544,453    1,274,049
       Capital lease obligations                             80        3,126
                                                   ------------- ------------
     Total current portion                              544,533    1,277,175
                                                   ------------- ------------

     Net Long Term Liabilities                     $          -  $       320
                                                   ============= ============

     Future minimum principal payments on notes payable and notes
payable-related party are as follows at December 31, 2001:

          2002                                                   $   544,453
                                                                 ------------

     Total notes payable and notes payable-related party         $   544,453
                                                                 ============


     Future minimum lease payments are as follows at December 31, 2001:

          2002                                                            80
                                                                -------------
          Total                                                 $         80
                                                                =============

NOTE 4 - COMMITMENTS AND CONTINGENCIES

     In December 2001, the Company committed to an operating lease for
warehouse space.  The lease requires the Company to make monthly payments of
$2,600 and expires in August 2002.

     In August 2001, the Company committed to subleasing an office space.  The
lease requires the Company to make monthly payments of $3,700 and expires in
August 2003.

     In December 1999 the Company committed to an operating lease for office
space.  The lease requires the Company to pay monthly rent of $12,317 and
expires in July 2002.


                                15
<PAGE> 34

                        WHOLE LIVING, INC.
          Notes to the Consolidated Financial Statements
                    December 31, 2001 and 2000


NOTE 4 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

     In March 1999 the Company committed to an operating lease for a vehicle.
The lease requires the Company to make monthly payments of $691 and expires in
March 2002.

     Future minimum payments on operating leases are as follows:

          2002                    $     156,685
          2003                           29,600
                                  --------------
          Total                   $     186,285
                                  ==============

     The Company sells and distributes its products through independent
distributors.  The Company is committed to an agreement  that guarantees a
monthly distributors bonus of $5,000 to one of its distributors who purchased
a distributor position for $50,000.  The distributor agreement can be
terminated within 90 days of the execution of the agreement at the option of
the distributor.  If canceled during this period a refund of the $50,000 less
monthly bonuses could occur.  The termination period ended February 28, 1999,
and at such time a contingency no longer exists, however the monthly
commitment continues as long as both parties perform their respective
obligations under the terms of the agreement.  The agreement has no
termination date.

     The Company is also committed to a consulting arrangement with an
individual, wherein the Company pays a $5,000 monthly draw against future
royalties from developing sales, training and educational aids on a
case-by-case basis.  The agreement can be terminated by a 90-day written
notice from either party.  Termination by the Company must be for cause.  The
Company paid $15,000 upon signing the agreement as a signing bonus which was
expensed as well as the monthly royalty payments.  There is no indication in
the agreement that repayment of the advances is required in the future.  The
Company received the individuals "downline" as part of the agreement, but no
asset has been recorded, because future economic benefit is unclear.

NOTE 5 - GOING CONCERN

     The accompanying financial statements have been prepared assuming that
the Company will continue as a going concern.  The Company has had recurring
net operating losses since inception and is dependent upon financing to
continue operations.  The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.  It is management's
plan to market it's products aggressively in all markets including Japan,
Australia and Korea. There is currently a campaign to reinvigorate current
markets through  distributor seminars.  Also management continues to
scrutinize expenses related to operating activities, especially production and
fulfillment.

NOTE 6 - RELATED PARTY TRANSACTIONS

     During 2001 and 2000, Mark Comer, a shareholder of the Company loaned
$1,342,743 and $409,305, respectively, to the Company.  During 2001 and 2000,
the Company paid back $537,506 and $-0-, respectively.  In 2001, the Company
converted $1,210,090 of the loan balance to eqity.  The loan bears interest at
10.5% and is payable upon demand.  The balance due at December 31, 2001 and
2000 is $-0- and $409,305, respectively.

     During 2001 and 2000, Tapdog.com, a corporation under common ownership,
loaned $111,716 and $150,000, respectively, to the Company.  During 2001 and
2000, the Company paid back $208,196 and $56,886, respectively.  The loan is
non-interest bearing and payable upon demand.  The balance due at December 31,
2001 and 2000 is $-0- and $93,114, respectively.

                                16
<PAGE> 35


                        WHOLE LIVING, INC.
          Notes to the Consolidated Financial Statements
                    December 31, 2001 and 2000


NOTE 6 - RELATED PARTY TRANSACTIONS (CONTINUED)

     During 2001 and 2000, Capital Communications, a shareholder of the
Company loaned $278,300 and $1,771,630 to the Company.  The Company in 2001
and 2000 converted $771,630 and $1,000,000 to common stock.  During 2001,
Capital has assigned its note to another shareholder, First Equity Corp.  The
balance due to Capital Communications at December 31, 2001 and 2000 is $0 and
$771,630, respectively.

     During 2001, First Equity Corp., a shareholder of the Company assumed the
loan balance from Capital Communications of $278,300.  First Equity Corp.
loaned the Company an additional $261,700.  The loan bears interest at 15% and
is payable upon demand.  The balance due at December 31, 2001 is $540,000.

NOTE 7 -  STOCK WARRANTS

     The Company applies SFAS 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.

     In September 2000, the Company entered into a consulting agreement with
Columbia Finacial Group, Inc., for investor relations, public relations,
publishing, advertising and other services. In exchange for a years worth of
service, the Company issued 800,000 stock warrants to acquire common stock at
$2.00 per share for 5 years.

     As of December 31, 2000, no services had been performed on this agreement
and the Company changed the exercise price of the warrants to $0.50.  No
expense was recorded in 2000.

     During 2001, these services were performed.  The value of the warrants
were detemrined using the Black-Scholes model with the following assumptions:
expected volatility 50%, risk-free interest rate of 4.5% and expected life of
5 years.  The Company has recognized an expense of $272,000.

     During 2001, 400,000 warrants were exercised and 400,000 remain
outstanding as of December 31, 2001.

NOTE 8 - EMPLOYEE STOCK OPTIONS

     On July 2, 2001, the Company established an Employee Stock Ownership Plan
(Plan).  The Plan covers both current and prospective employees, consultants
and directors.

     The exercise price for each option shall be established by the Company's
Board of Directors.  The exercise price per share for the incentive stock
option cannot be less than 100% of the fair market value of common shares on
the grant date.

     As of December 31, 2001, there are 2,345,000 options granted and
exercisable.  These options expire in 3 to 5 years.  As of January 1 of each
year, beginning with 2002, the aggregate number of options that may be awarded
under the Plan shall automatically increase by a number equal

                                17

<PAGE> 36


                        WHOLE LIVING, INC.
          Notes to the Consolidated Financial Statements
                    December 31, 2001 and 2000


NOTE 8 -  EMPLOYEE STOCK OPTIONS (CONTINUED)

to the lesser of 5% of the total number of common shares outstanding or
2,500,000 shares.

     On the grant date,  2,345,000 options were exercisable.  These options
are valued using the Black-Scholes pricing model with the following
assumptions: volatility of 50%, risk-free rate of 4.5%, option life of 3 or 5
years.  The Company has recorded compensation expense for the options in the
amount of $715,150.

     A summary of the option activity follows:

                                                                Weighted
                                   Options                      Average
                                   Available     Options        Exercise
                                   For Grant     Outstanding    Price
                                   ------------- -------------- -------------

      Balances, January 1, 2001               -              -  $          -

      Granted                         2,345,000      2,345,000          0.50
      Exercised                               -              -             -
      Canceled/forfeited                      -              -             -
                                   ------------- -------------- -------------

      Balances, December 31, 2001     2,345,000      2,345,000  $       0.50
                                   ============= ============== =============





                                18

<PAGE> 37

                 ITEM 8: CHANGES IN ACCOUNTANTS

      As previously reported, Chisholm & Associates, CPA's, replaced Crouch,
Bierwolf & Chisholm, CPA's, as our independent auditor on August 3, 2000.


                             PART III

ITEM 9: DIRECTORS AND EXECUTIVE OFFICERS; COMPLIANCE WITH SECTION 16(a)

Directors and Executive Officers

      Our executive officers and directors and their respective ages and
positions are set forth below.  Biographical information for each of those
persons is also presented below.  Our bylaws require three directors who serve
until our next annual meeting or until each is succeeded by another qualified
director.  We currently have a vacancy on our Board which we expect to fill
within the next 90 days.  Our executive officers are chosen by our Board of
Directors and serve at its discretion.  There are no existing family
relationships between or among any of our executive officers or directors.


Name                        Age            Position Held
-------------------------- -------  ----------------------------------------
Ronald K. Williams            39            President, CEO and Director
Douglas J. Burdick            30            Executive Vice-President and Chief
                                              Operating Officer
Sharmon L.  Smith             41            Secretary/Treasurer, Chief
                                               Financial Officer, Director

      Ronald K. Williams -  President and Director of Whole Living Utah since
November of 1998.  Mr. Williams served as our CEO from March 1999 to November
2000 and was appointed CEO in June 2001.  Mr. Williams is a network marketing
industry veteran, having served from April 1992 to September 1997 as Vice
President of Marketing for Neways International of Salem, Utah.  Neways
International is a privately held network marketing company that sells
personal care and nutritional supplements.  In September 1997, he left Neways
to accept the General Manager and Vice President of Marketing position at
Young Living Essential Oils, a company headquartered in Payson, Utah, which is
a privately held network marketing company which sells aroma therapy oils and
personal care products. From September 1997 through November 1998, he served
as General Manager and eventually Vice President of Marketing for Young Living
Essentials, Payson, Utah.

      Douglas J. Burdick -  Appointed Executive Vice President and Chief
Operating Officer in November 2001.  Mr. Burdick joined Whole Living as an
independent distributor in 2000.  He has over six years experience in the
network marketing industry as a network marketer and trainer.  From 1997 to
2000 he was a network marketer and trainer for The People's Network and, as an
independent distributer for that company had an organization of 76,000
distributors.  From June 1999 to November 1999 he worked as a consultant for
OneWorld Online developing their business model and directed an organization
of 10,000 distributors.  From 1995 to 1997 he directed a 216,000 distributor
organization with Freeway 100.

      Sharmon L. Smith -  Appointed interim director on June 8, 2001 and later
appointed as Secretary/Treasurer and Chief Financial Officer.  Mr. Smith is
the President and founder of Tapdog.com LLC, which is a company that provides
Internet and business consulting.  From August 1998 to March 1999 he was
employed as a Internet consultant for Fortune Financial.  From January 1996 to
August 1998 he was employed as an Executive Vice President of iMall, Inc.
providing operational management.  He earned a Masters degree in Business
Administration from Brigham Young University located in Provo, Utah.


                                38
<PAGE>

Section 16(a) Beneficial Ownership Reporting Compliance

      Section 16(a) of the Securities Exchange Act of 1934 requires our
directors, executive officers and persons who own more than five percent of a
registered class of our equity securities, to file with the Securities and
Exchange Commission initial reports of ownership and reports of changes in
ownership of common stock and our other equity securities.  Officers,
directors and greater than ten-percent beneficial owners are required by SEC
regulations to furnish us with copies of all Section 16(a) reports they file.
Based solely upon review of the copies of such forms furnished to us during
the fiscal year ended December 31, 2001 and representations from known
reporting persons that Forms 5 were not required, to the best of our knowledge
Douglas J. Burdick filed late a Form 3.


                 ITEM 10: EXECUTIVE COMPENSATION

      The following tables show the compensation paid in cash, stock or stock
options to our named executive officers in all capacities during the past
three fiscal years.


                    SUMMARY COMPENSATION TABLE

                       Annual Compensation
                      ---------------------


Name and principal                                           Other annual
position                     Year   Salary ($)   Bonus ($)   compensation ($)
--------------------------   ----- ------------- ---------- -----------------
Ronald K.Williams            2001   $13,529      $ 0         $ 44,804 (1)
President, CEO               2000    34,779        0                0
Director                     1999    60,000        0            6,000


Douglas J. Burdick           2001         0        0           86,300 (1)
Exec VP                      2000         0        0           16,000 (1)
                             1999         0        0                0

Richard F. Wogksch           2001    47,500        0            2,500 (1)
Former Secretary/Treasurer   2000         0        0           17,500 (1)
CFO                          1999         0        0                0

Sharmon L. Smith             2001         0        0                0
Secretary/Treasurer,         2000         0        0                0
Chief Financial Officer      1999         0        0                0
Director



 (1) Represents consulting fees



                      Long Term Compensation
                            -----------------------

                                         Awards            Payouts
                                  ----------------------- ---------

                                               Securities           All
                                  Restricted   Underlying  LTIP     Other
Name and principal                Stock        Options/    Payouts  Comp.
position                 Year     Awards ($)   SAR's (#)   ($)      ($)
----------------------- --------- ------------ ----------- -------- ---------


                                39
<PAGE>

Ronald K. Williams       2001     $ 0            800,000     0        0
President, CEO           2000       0                  0     0        0
Director                 1999       0                  0     0        0

Douglas J. Burdick       2001       0            350,000     0        0
Executive VP             2000       0                  0     0        0
                         1999       0                  0     0        0

Richard F. Wogksch       2001       0                  0     0        0
Former Secretary,        2000       0                  0     0        0
Treasurer & Director     1999       0                  0     0        0

Sharmon L. Smith         2001       0            250,000     0        0
Secretary, Treasurer,    2000       0                  0     0        0
Chief Financial Officer, 1999       0                  0     0        0
Director



              OPTION/SAR GRANTS IN LAST FISCAL YEAR
             ---------------------------------------

                        Individual Grants
                        -----------------
                                       Percent of
                       Number of       total
                       securities      options/SARs
                       underlying      granted to     Exercise or
                       Options/SARs    employees in   base price    Expiration
      Name             granted (#)     fiscal year    ($/sh)        date
--------------------- ---------------- -------------- ------------- ----------
Ronald K. Williams      300,000         18.5%          $0.50         7/12/06
                        500,000         30.8%           0.50         9/20/06


Sharmon L. Smith        150,000          9.2%           0.50         7/12/06
                        100,000          6.2%           0.50         9/20/06


Douglas J. Burdick      200,000         12.3%           0.50         7/12/06
                        150,000          9.2%           0.50         9/20/06



      Director Compensation   We do not have any standard arrangement for
compensation of our directors for any services provided as director, including
services for committee participation or for special assignments.

      Profit Sharing Plan   On September 21, 2001 our Board authorized a
profit sharing pool using 2% of our quarterly net profits.  The initial plan
called for a distribution of 0.6% to Ronald K. Williams, 0.4% to Douglas J.
Burdick and .3% to Sharmon L. Smith.  During fiscal year 2001 no distributions
were made.

      Employment Contracts   We entered into an agreement with Mr. Williams in
March of 1999.  The term of the agreement was for an initial term of three
years, with automatic renewal for one year periods thereafter.  Under the
agreement he is entitled to receive a base salary of $60,000 during the first
year of the agreement and he is entitled to incentive bonuses, vacation time,
insurance on an automobile, stock options at the Board's discretion and
reimbursement for expenses.  We may terminate the employment agreement for
cause as that term is defined

                                40
<PAGE>

in the agreement.  If we terminate the employment at our discretion, he will
receive compensation due him for a period of twelve months.  Mr. Williams has
promised not to compete with Whole Living for a period of one year after
termination.

ITEM 11: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

      The following table sets forth the beneficial ownership of our
management.  We are unaware of any person or group who beneficially owns more
than 5% of our outstanding common stock. Beneficial ownership is determined in
accordance with the rules of the SEC and generally includes voting or
investment power with respect to securities.  Except as indicated by footnote,
the persons named in the table below have sole voting power and investment
power with respect to the shares of common stock shown as beneficially owned
by them.  The percentage of beneficial ownership is based upon 24,044,340
shares of common stock outstanding as of April 10, 2002 and the underlying
shares for options available to each officer.


                            MANAGEMENT

                                          Common Stock Beneficially Owned
                                          ----------------------------------
Name and Address of       Number of Shares of   Underlying Shares    Percent
Beneficial Owners         Common Stock          Options (1)          Of Class
------------------------- --------------------  -------------------- ---------

Ronald K. Williams            1,567,567             800,000              9.5%
629 East 730 South,
Suite 201
American Fork, Utah 84003

Douglas J. Burdick                    0             350,000              1.4%
629 East 730 South,
Suite 201
American Fork, Utah 84003

Sharmon L. Smith                 30,000             250,000              1.2%
629 East 730 South,
Suite 201
American Fork, Utah 84003

All executive officers and
directors as a group          1,597,567           1,400,000             11.8%

      (1) Includes options exercisable within the next 60 days.

     ITEM 12: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      The following information summarizes certain transactions either we
engaged in during the past two years or we propose to engage in involving our
executive officers, directors, more than 5% stockholders or immediate family
members of such persons.

      On September 21, 2001 our Board authorized a profit sharing pool using
2% of our quarterly net profits.  The initial plan called for a distribution
of 0.6% to Ronald K. Williams, 0.4% to Douglas J. Burdick and 0.3% to Sharmon
L. Smith.  We did not make any distributions under this profit sharing plan
during fiscal year 2001. This transaction was negotiated between related
parties without "arms length" bargaining and as a result the terms of this
transaction may be different than transactions between unrelated parties.

      On September 20, 2001 we granted options to purchase common shares at an
exercise price of $0.50 to

                                41
<PAGE>



Ronald K. Williams, Douglas J. Burdick and Sharmon L. Smith.  We granted
options to purchase 500,000 shares to Mr. Williams and options to purchase
100,000 shares to Mr. Smith and 150,000 to Mr. Burdick.  The options expire
September 20, 2006.

      On July 12, 2001 we issued 300,000 shares valued at $150,000 to Ronald
K. Williams, our President, for compensation for services rendered on our
behalf.  We also issued 200,000 shares valued at $100,000 to Douglas J.
Burdick, and 150,000 shares valued at $75,000 to Sharmon Smith, our Director,
for services rendered.

During fiscal year 1999, PHI Mutual Ventures LLC, a more than 5% shareholder
at that time, loaned Whole Living an aggregate of $990,000 with interest rates
ranging from 9% to 10%.  In March of 2000, $500,000 of the notes payable were
converted into 400,000 common shares.

      During 1999 and 2000, our then executive officers and directors owned
interests in MRB, LLC, now called Indigo Media.  MRB prepared sales aids and
product kits for Whole Living, including the design and production of printing
and packaging, and the production of video and audio tapes.  Mark Burdge, our
former director, owned a 40% interest in MRB and Ronald K. Williams, our
President, and William B. Turnbull and Bruno Vassel III,  then officers and
directors, each owned 20%.  MRB provided products to Whole Living on 90 day
credit at competitive rates.  Whole Living paid MRB approximately $198,000 for
the year ended December 31, 1999 and $134,880 for the year ended December 31,
2000.  Messrs. Williams, Turnbull and Vassel divested themselves of their
interest in MRB in early 2001.

      On December 1, 1999, we entered into a service agreement with Excel
Graphics, a Utah corporation, to provide product warehousing and fulfillment.
Mark Burdge, our shareholder and then director, is the President and major
shareholder of Excel Graphics.  We paid an aggregate of $57,551 to Excel
Graphics for its services in 1999 and 2000.  The terms of the service
agreement are no more favorable than we could receive from an independent
third party.

      During fiscal year 2000, we borrowed $150,000 with no interest from
Tapdog.com, LLC.  Sharmon L. Smith, our director, is the President and a 40%
member of Tapdog.  During 2000 we paid a total of $56,886 on this debt and
also paid Tapdog $7,339 for additional services.

      During 2000, Capital Communications, Inc., a more than 5% shareholder at
that time, loaned Whole Living $1,771,630, with 14.5% interest, payable upon
demand.  On June 21, 2000 we issued  2,000,000 shares of common stock to
satisfy $1,000,000 of the note payable.  1,200,000 shares were issued to the
assignee of the Capital Communications note payable, Development Specialties,
Inc.  The remaining $771,630 due was secured by all the business assets of
Whole Living, including inventory, as well as, 3,135,134 shares pledged as
collateral by Messrs. Williams and Turnbull, our then officers and directors.

      During fiscal year 2000, Mark Comer, a more than 5% shareholder, loaned
Whole Living $409,305 at 10% interest payable on demand.   During 2001 this
loan was converted into equity.

ITEM 13.      EXHIBITS AND REPORTS ON FORM 8-K

Exhibits

Exhibit
Number            Description
-------         --------------
3.1            Articles of Incorporation of Whole Living (incorporated by
               reference to Form exhibit 2.1 10-SB, as amended, filed August
               9, 1999)

3.2            Bylaws of Whole Living (incorporated by reference to exhibit
               2.4 to the Form 10-SB, as amended, filed August 9, 1999)


10.1           Lease between Whole Living and KL Partners American Fork II,
               LLC, dated November 26, 1999 (incorporated by reference to
               exhibit 6.1 to the Form 10-SB, as amended, filed August 9,
               1999)

10.2           Employment Agreement between Ron Williams and Whole Living
               (incorporated by reference to exhibit 6.2 to the Form 10-SB, as
               amended, filed August 9, 1999)

10.3           Stock Purchase Agreement between Whole Living and Investors,
               dated April 23, 2001 (Incorporated by reference to exhibit
               10.6 to SB-2 registration statement filed June 29, 2001)

10.4           Registration Rights agreement Between Whole Living and
               Investors, dated May 7, 2001 (Incorporated by reference to
               exhibit 10.7 to SB-2 registration statement filed June 29,
               2001)



Reports on Form 8/K

      None.


                                43
<PAGE>

                            SIGNATURES

      In accordance with Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                          WHOLE LIVING, INC.


Date:  4/15/02                  By:    /S/ Ronald K. Williams
                                       ------------------------------
                                            Ronald K. Williams
                                            President, CEO and Director



      Pursuant to the requirements of the Securities Exchange Act of 1934.
This report has been signed below by the following person on behalf of the
Registrant and in the capacities and on the dates indicated.




Date: 4/15/02                      By: /s/ Sharmon L. Smith
                                       -----------------------------------
                                             Sharmon L. Smith
                                             Secretary/Treasurer and Director






                                44