SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

                        FOR ANNUAL AND TRANSITION REPORTS
                         PURSUANT TO SECTIONS 13 OR 15(D)
                      OF THE SECURITIES EXCHANGE ACT OF 1934

     /X/    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999
                                       OR
         / /    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

         FOR THE TRANSITION PERIOD FROM ______________ TO ______________

                         COMMISSION FILE NUMBER 0-18160

                            OMNI NUTRACEUTICALS, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

              UTAH                               87-0468225
     (STATE  OF  INCORPORATION)     (I.R.S.  EMPLOYER  IDENTIFICATION  NO.)

                              5310 BEETHOVEN STREET
                          LOS ANGELES, CALIFORNIA 90066
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (310) 306-3636

        SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NONE

           SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:

                     COMMON STOCK, PAR VALUE $.01 PER SHARE
                                (TITLE OF CLASS)

                                        1
<PAGE>
Indicate  by  check  mark  whether  the  registrant:  (1)  has filed all reports
required  to  be  filed by Section 13 or 15(d) of the Securities Exchange Act of
1934  during  the  preceding  12  months  (or  for  such shorter period that the
registrant  was required to file such reports), and (2) has been subject to such
filing  requirements  for  the  past  90  days.  Yes:  /X/  No:  /  /

Indicate  by  check mark if disclosure of delinquent filers pursuant to Item 405
of  Regulation  S-K  is  not contained herein, and will not be contained, to the
best  of  registrant's  knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form  10-K.  Yes:  /X/  No:  /  /

As  of  March  31, 2000, 28,894,617 shares of the registrant's Common Stock, par
value  $0.01,  were  outstanding. The aggregate market value of the Common Stock
held  by  non-affiliates  of  the  registrant  (i.e.,  excluding  shares held by
executive  officers,  directors,  and control persons as defined in Rule 405) on
that  date was $57,749,391 (computed based upon the closing price for the Common
Stock  on  the  Nasdaq  National  Market  on  that  date.)

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      None

                                        2
<PAGE>
                            OMNI NUTRACEUTICALS, INC.
                               INDEX TO FORM 10-K




     PAGE
PART  1
Item 1     Business                                                         4
Item 2     Properties                                                      11
Item 3     Legal Proceedings                                               11
Item 4     Submission of Matters to a Vote of Security Holders             12
PART  II
Item  5    Market  for  the  Registrant's Common Stock and
           Related Stockholder Matters                                     12
Item 6     Selected Financial Data                                         14
Item  7    Management's  Discussion  and  Analysis  of Financial
           Condition and Results of Operation                              15
Item 7a    Quantitative and Qualitative Disclosure about Market Risk       21
Item 8     Financial Statements and Supplementary Data                     21
Item  9    Changes  in  and  Disagreements  With Accountants on
           Accounting and Financial Disclosure                             21

PART  III
Item 10    Directors and Executive Officers of the Registrant              21
Item 11    Executive Compensation                                          24
Item 12    Security  Ownership  of  Certain Beneficial Owners
           and Management                                                  27
Item 13    Certain Relationships and Related Transactions                  28

PART  IV
Item  14   Exhibits,  Financial Statement Schedules, and Reports on
           Form 8-K                                                        31
Exhibit Index                                                              32
Index to Financial Statements                                             F-1
Financial Statements                                                      F-2
Signature Page

                                        3
<PAGE>
                                     PART I
                                     ------

THIS ANNUAL REPORT ON FORM 10-K INCLUDES "FORWARD-LOOKING STATEMENTS" WITHIN THE
MEANING  OF  SECTION  27A  OF  THE  SECURITIES  ACT  OF  1933,  AS  AMENDED (THE
"SECURITIES  ACT")  AND  SECTION  21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED (THE "EXCHANGE ACT"). ALL STATEMENTS OTHER THAN STATEMENTS OF HISTORICAL
FACT  INCLUDED  IN  THIS  ANNUAL  REPORT,  INCLUDING,  WITHOUT LIMITATION, THOSE
REGARDING  THE  COMPANY'S  FINANCIAL  POSITION,  BUSINESS, MARKETING AND PRODUCT
INTRODUCTION  AND  DEVELOPMENT  PLANS  AND  OBJECTIVES  OF MANAGEMENT FOR FUTURE
OPERATIONS,  ARE  FORWARD-LOOKING STATEMENTS. ALTHOUGH THE COMPANY BELIEVES THAT
THE EXPECTATIONS REFLECTED IN SUCH FORWARD-LOOKING STATEMENTS ARE REASONABLE, IT
CAN  GIVE  NO  ASSURANCE THAT SUCH EXPECTATIONS WILL PROVE TO HAVE BEEN CORRECT.
IMPORTANT  FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE
COMPANY'S  EXPECTATIONS  ARE  DISCLOSED  UNDER  "BUSINESS-RISKS  RELATED  TO THE
BUSINESS  OF  THE  COMPANY,"  "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION  AND  RESULTS  OF  OPERATIONS"  AND  ELSEWHERE  IN  THE ANNUAL REPORT.

ITEM  1.  BUSINESS

GENERAL

 Omni  Nutraceuticals,  Inc.,  a  Utah  corporation  (the  "Company" or "Omni"),
formerly  known as Irwin Naturals/4Health, Inc., is the surviving corporation of
a  merger  (the  "Merger") of 4Health, Inc., a Utah corporation ("4Health") with
Irwin  Naturals,  a  California  corporation  ("IN")  consummated June 30, 1998.
Pursuant  to  the Merger, IN was merged with and into 4Health. Upon consummation
of  the  Merger,  4Health  changed its name to Irwin Naturals/4Health, Inc.   On
August  20,  1999,  the  Company  changed  its name to Omni Nutraceuticals, Inc.

The  Company  is a supplier and formulator of branded natural health, herbal and
nutritional  supplements designed and formulated to address the dietary needs of
the  general  public.  The  Company's  products are produced solely from natural
ingredients and are formulated for the purposes of achieving specific dietary or
nutritional goals.  During 1999, the Company began an Internet initiative by the
creation  of  HealthZone.com  via  the acquisition of Health & Vitamins Express,
Inc.  HealthZone.com  is  an  online  retail  store  and  information source for
vitamins,  supplements,  minerals and other natural and healthy living products.
Through the Company's innovative combination of content and commerce, management
intends  to  establish HealthZone.com as the preferred destination for consumers
interested  in  natural  and  healthy living products.  HealthZone.com currently
offers  approximately  16,000  products  on  its  site  and  can  special  order
additional  products  through  the Company's supplier relationships. The Company
continues to increase our product assortment.  In addition, the Company provides
educational  and  authoritative  news  and  information  about  its products and
healthy  living  in general, which we integrate with its product offerings in an
easily  accessible way.  Through the Company's marketing efforts, the Company is
seeking to establish HealthZone.com as a trusted advisor to the Company's online
community.

                                        4
<PAGE>

On July 16, 1996, 4Health emerged from an earlier merger between 4health Inc., a
California  corporation  ("Old 4health") and Surgical Technologies, Inc., a Utah
corporation  ("SGTI").  Subsequent  to  this  merger,  SGTI  changed its name to
4Health,  Inc. Old 4health was incorporated and commenced operations on February
17,  1993.  IN  was  organized  in  August  1995  and formulated and distributed
nutritional  supplements through the food, drug and mass market, internationally
and  through  health  food  stores.  The  Merger  was  accounted  for  under the
"pooling-of-interests"  method  of  accounting,  in  accordance  with  generally
accepted  accounting  principles.  The  Merger  resulted  in  the  issued  and
outstanding  shares  of  common  stock,  no  par  value  per  share, of IN being
converted  into  an  aggregate  15,750,000  shares  of  4Health  Common  Stock.

On  February 15, 1999, the Company acquired by way of a merger with and into its
California subsidiary, HealthZone.com, Health & Vitamin Express, Inc. ("HVE"), a
California  on-line  retailer  of  health  products,  in  consideration  for the
issuance  of  363,636  shares of common stock of the Company issued in a private
placement  to  the three shareholders of HVE, with a further contingent issue of
363,636  shares  of  common stock depending upon HVE meeting certain performance
criteria  (assuming  a  $10  million investment in its subsidiary by the Company
within  36  months)  and  the  assumption  of  approximately  $571,000  of debt.

On  March  10,  1999,  the  Company  acquired  certain assets and liabilities of
Inholtra  Investment  Holdings  and  Trading,  N.V.,  Inholtra Inc. and Inholtra
Natural,  Ltd., including the Inholtra-registered trademark- brand of anti-joint
pain product and associated trademarks, patent and inventory, for $13.3 million,
which  was  initially  seller  financed  with  a  short  term  promissory  note,
subsequently refinanced in June 1999 with a $20 million secured asset based term
and  revolving credit facility with a bank.  See Item 7 "Management's Discussion
and  Analysis  of  Financial  Condition  and  Results  of  Operations."

On  March  17, 2000 the Board of Directors of the Company authorized the Company
to  change  its  name  to HealthZone.com subject to shareholder approval, and to
effect  a  merger  of  its subsidiary HealthZone.com, with and into the Company.

PRODUCTS

The Company is a supplier and formulator of vitamins and nutritional supplements
that  are  manufactured  primarily from natural herbs, botanicals and nutrients.
The  Company  has  three  broad categories of  products including: (i) cleansing
products  to  eradicate  the  toxins  from  the  body;  (ii)  building products,
including 151 Bars that increase the body's energy and stamina through restoring
vital  nutrients  to  the  appropriate  levels; and (iii) specific solutions for
selected organ and body systems to concentrate on an individual's problem areas.
The  Company's top brand names are: Nature's Secret-Registered Trademark- (23.1%
of  1999 revenue), Inholtra - Registered Trademark (19.3% of sales in 1999) Diet
Systems  6-Registered  Trademark-  (15.9%  of  1999  revenue),  and  Irwin
Naturals-Registered  Trademark  (15.0%  of  1999  revenue).

With  over  69 registered and pending trademarks worldwide, the Company believes
that  certain  of  its product formulas are proprietary and cannot be duplicated
without  the  master  recipes,  which  are  secured  in safekeeping. The Company
attempts  to  protect  its products and formulas with, among other things, "non-
disclosure/non-competition"  agreements with its manufacturers and employees and
trademark  protection. The formulations of the Company's products were developed
by  the  Company's  founders  R. Lindsey Duncan, a nutritionist certified by the
National  Institute  of  Nutritional  Education  and  Klee  Irwin, the Company's
current  Chief  Executive  Officer  and  its  principal shareholder. The Company
trademarks  all  brand  line  names  and most product names. The Company further
protects its trademarks by taking prompt action against potential infringements.

                                        5
<PAGE>


MANUFACTURING  AND  SUPPLY  SOURCES

All of the Company's products are manufactured by third party suppliers pursuant
to  the  Company's  specifications and proprietary recipes. All of the companies
that  manufacture  for  the  Company  are  required to meet strict manufacturing
standards  required  by  the  Food and Drug Administration ("FDA"). To date, the
Company  has relied exclusively on domestic manufacturers in order to facilitate
quality  assurance  monitoring. Prior to selecting a manufacturer to produce its
products,  the  Company reviews the manufacturer's raw material sources, quality
assurance  procedures,  and reliability to assure that the proposed manufacturer
meets  the  Company's  criteria.

The  Company  places  purchase  orders with its suppliers for individual product
manufacturing  lots.  Delivery  of packaged and labeled products are made to the
Company's  distribution  center  in  Los Angeles, California. The Company has no
long-term  manufacturing  agreements  with  any  of its suppliers, but purchases
manufactured lots pursuant to individual purchase orders. Currently, the Company
utilizes  eight  different  manufacturers  and  believes  that  there  are other
qualified  manufacturers  that  would  meet  quality  assurance  requirements if
alternative manufacturing sources were required. The Company has an inventory of
approximately  60  to  90  days  of  anticipated  demand  and  to  date  has not
experienced  material  shortages  of  manufactured  products  for  delivery. All
ingredients  in  the Company's products are generally available from a number of
alternative sources, although certain of the ingredients, such as those based on
agricultural products, are subject to seasonal availability to a limited degree.

MARKETING  AND  DISTRIBUTION

The  Company utilizes its marketing expertise to position and sell its portfolio
of  branded  products.  The  Company  is  continuing  to  build its portfolio of
consumer  brands.  The Company aims to achieve brand growth through advertising,
attractive  packaging  and  favorable  shelf  positioning.  This  process may be
augmented  through  targeted  brand  acquisitions.  The  sales,  marketing  and
distribution  infrastructure  is  designed  to  integrate  new brands with minor
incremental  costs  and  synergistic  potential.  Historically,  the Company has
distributed  its  products  though  three  main  segments: mass market retailers
(51.5%  of  1999 revenue), specialty health food stores (40.7% of 1999 revenue),
and  internationally (7.8% of 1999 revenue). Through advertising, the Company is
able  to  convey  the effectiveness of its products. The Company has established
its  reputation  with  retailers  through  quality products, timely delivery and
superior  packaging. Through its ability to position products in the marketplace
and  its  strong reputation, the Company has been able to secure favorable shelf
spacing  from  most  of  its  retail  customers.

The  Company  is positioned to pursue a distribution strategy of multiple brands
within  multiple  retail  channels  and  via the Internet. Since the Merger, the
Company  has  expanded  its  consumer  base, and now offers products in distinct
product  categories.

CUSTOMER  CONCENTRATION

The  Company's top ten customers represented approximately 42% of its 1999 total
revenues  including GNC, which represented approximately 18.6% of its 1999 total
revenues.  Management believes that, except for its sales to GNC,  its remaining
business  is sufficiently diversified among its customers.  However, the Company
is  undertaking  additional  efforts  to  diversify  its  revenues  along  both
distribution  channels and among specific customers. In this regard, the Company
intends  to  develop  its  e-commerce  business  as a new potential distribution
channel  for  its  products.

                                        6
<PAGE>


COMPETITION

The industry in which the Company operates is highly competitive and fragmented.
It  is  estimated that nearly 900 companies are involved in the manufacturing or
wholesale  of  supplements  to  the mass markets. Of those 900, eleven companies
comprise  25% of the market with the remaining 75% comprised mostly of companies
generating  less  than  $20  million  in  total  annual  sales.

The  ten  largest competitors are large well-capitalized companies that have the
ability  to  change  and  shape  the  industry.

In  the  health  and  natural  food sector these include:  Nature's Way (Murdock
Madaus Schwabe), Rainbow Light Nutritional Systems (Nutraceuticals, Inc.) Solgar
(American  Home Products), Nature's Herbs and Twinlabs (Twin Laboratories, Inc.)

In  the Mass Market sector the competitors include:  Whitehall Robins Healthcare
(American  Home  Products),  Bayer  AG  (Bayer Corp.), Mead Johnson Nutritionals
(Bristol  Myers  Squibb Co.), Johnson & Johnson, Inc. and Leiner Health Products
Group,  Inc.

The  Company continues to be a leader in internal cleansing products and intends
to  leverage  this  success  to  launch  other products.  The Company's Nature's
Secret-Registered  Trademark-  and  Harmony  Formula-Registered Trademark- brand
lines  have  built  strong  brand  loyalty  with  retailers,  practitioners  and
customers  by  delivering  quality  products,  excellent customer service and an
emphasis  on  health  through  education.

In the food, drug and mass market, the Company faces increased competition where
many  of  its  competitors  are  significantly larger and have greater financial
resources.  The Company believes it will be able to compete successfully in this
mass  market  because of its unique formulations and packaging, product quality,
and  good  relationships  with  distributors  and  store  buyers.

The  electronic  commerce  industry  is  new,  rapidly  evolving  and  intensely
competitive,  and  we expect competition to intensify in the future. Barriers to
entry  are  minimal  and  current  and  new  competitors  can  launch sites at a
relatively  low  cost. Many of our competitors are significantly larger and have
greater  financial  resources.  In addition, the vitamins, supplements, minerals
and  natural  and  healthy living products market is very competitive and highly
fragmented,  with  no clear dominant leader and increasing public and commercial
attention.

EMPLOYEES

As of the end of 1999, the Company had 93 employees, 9 senior managers, 7 middle
managers,  33 individuals in general administration, 25 individuals in sales and
marketing,  16  individuals in distribution and one in research and development.
The  Company's  employees  are  not  represented  by  a  collective  bargaining
organization,  and  the Company is not aware of any efforts to organize any such
collective  bargaining  unit. The Company has not experienced any work stoppages
or  slow  downs.

RISKS  RELATED  TO  THE  BUSINESS  OF  THE  COMPANY

In  order  to  fund its operations, the Company has relied on raising additional
equity  capital  and  the  use  of  bank  debt  to fund any operating losses and
acquisitions. In view of the Company's losses for the period ending December 31,
1999 and the anticipated loss for the period ending March 31, 2000, no assurance
can be given that these sources of capital will remain available to the Company.

                                        7
<PAGE>


EXPANSION  OF  DISTRIBUTION  CHANNELS

The Company anticipates expanding current distribution channels, introducing new
products,  entering  new  markets,  and  in general expanding its activities and
operations.  The  Company  also  intends  to  expand  its  marketing strategy to
strengthen the HealthZone.com brand name, increase traffic to the HealthZone.com
store,  build  strong  customer  loyalty,  maximize repeat purchases and develop
incremental  revenue  opportunities.

Because  of  the  nature  of  any  such  expansion,  the accompanying results of
operations for previous periods may not necessarily be indicative of the results
of  operations in the future. While the Company has been successful in expanding
its  markets and distributors to date, there can be no assurance that it will be
able  to successfully continue to expand in the future. Further, there can be no
assurance  that  expenditures  of funds to expand current distribution channels,
introduce  new  products,  enter  new  markets,  and  in  general  to expand the
Company's activities and operations will be successful in generating incremental
profitable  revenue.

DIFFICULTY  OF  STRICT  COMPLIANCE  WITH  GOVERNMENT  REGULATIONS

The  processing,  formulation,  packaging,  labeling  and  advertising  of  the
Company's  products  are  subject to regulation by more than one federal agency.
Congress has recognized the potential impact of dietary supplements in promoting
the  health  of  US citizens by enacting the Dietary Supplement Health Education
Act  of  1994  ("DSHEA").  Because  of the broad language of certain sections of
DSHEA  and  the  regulations  that implement it, it is difficult for any company
manufacturing  or  making  dietary  supplements  to remain in strict compliance.

On  November  24,  1997,  the  Commission  on Dietary Supplement Labels, a seven
member  group  appointed  by  the  President  of  the  United  States  (the "DSL
Commission"),  issued  an  84  page  report  (the  "Report") which includes many
recommendations  for  the  regulation of label claims and statements for dietary
supplements.  The  DSL  Commission's conclusions and advice are in the form of a
series  of  Findings  and Guidelines and its ultimate recommendations are called
Recommendations.  Section 12 of DSHEA requires the FDA to publish in the Federal
Register  "a  notice  of  any  recommendation  of  the Commission for changes in
regulations of the Secretary for the regulation of dietary supplements and shall
include  in such notice a notice of proposed rulemaking on such changes together
with  an  opportunity  to  present  views  on  such  changes."

Based  on the report, and pursuant to Section 12 of DSHEA, on April 29, 1998 the
FDA  published  a  proposed  rule  entitled  "Regulations on Statements Made for
Dietary  Supplements  Concerning  the  Effect of the Product on the Structure or
Function of the Body" (the "S/F Rule"). This proposed rule, if made a final rule
(that  is  a  regulation), would broaden what the FDA considers an impermissible
drug  claim  or disease claim for a dietary supplement. At the same time the S/F
Rule would restrict and narrow the permissible structure/function statements the
Company  could make about the benefits of its products on the label and labeling
(brochures).  Indirectly,  this S/F rule would narrow the permissible claims the
Company  could  place in advertisements. The effective date of the regulation is
proposed  as  30 days after the final rule is published in the Federal Register.
While  there  is  no  way  the Company can predict the language of the resulting
regulation,  based  upon  advice of their FDA counsel, the Company believes that
the  S/F  rule  will  not  be issued in the form as published on April 29, 1998.


                                        8
<PAGE>


CONCENTRATION  OF  CUSTOMERS

The Company received approximately 18.6% and 13.3% of its revenues from a single
customer (GNC) during 1999 and 1998, respectively. The Company does not have any
long-term contractual relationship with this customer. The loss of this customer
would  have  an  adverse  impact  on  the  business  of  the  Company.

RELIANCE  ON  LIMITED  NUMBER  OF  PRODUCTS

The  Company  currently  offers approximately 313 products and derived more than
30.5%  of  its  revenues  during  1999  from the sale of  two products, Ultimate
Cleanse  -  Registered  Trademark  -  and Inholtra - Registered Trademark.  As a
result  of  the  limited  number  of products from which the Company derives its
revenue,  the  risks  associated  with  the  Company's business increase since a
decline  in market demand for one or more products, for any reason, could have a
significant  adverse  impact  on  the  Company.

STRENGTH  OF  THE  COMPANY'S  COMPETITORS

Competition  in  the  nutritional  supplement  industry is vigorous with a large
number  of  businesses engaged in the industry. Operations in the food, drug and
mass  market exposes the Company to increased competition from vitamin and other
health  related  products  that  compete for the same shelf space. Many of these
competitors  have  established  reputations  for  successfully  developing  and
marketing  nutritional supplement products. Many of these companies have greater
financial,  managerial,  and technical resources than the Company, which may put
the  Company  at a competitive disadvantage. If the Company is not successful in
competing  in  those  markets,  it  may  not  be  able  to  realize its business
objectives.

Our  Internet  competitors  can  be  divided  into  several  groups  including:
traditional  vitamins,  supplements,  minerals  and  natural  and healthy living
products  retailers, including General Nutrition Centers and Vitamin Shoppe; the
online retail initiatives of several traditional vitamins, supplements, minerals
and  natural  and healthy living products retailers, including MotherNature.com,
VitaminShoppe.com and Vitamins.com; online retailers of pharmaceutical and other
health-related  products  that  also  carry  vitamins, supplements, minerals and
natural  and  healthy  living  products,  including Drugstore.com, PlanetRx.com,
More.com,  SelfCare  and  CVS.com; independent on-line retailers specializing in
vitamins,  supplements,  minerals  and  natural  and  healthy  living  products,
including HealthShop.com, eNutrition, allherb.com, vitamins.net, HealthQuick and
Vitanet; mail-order and catalog retailers of vitamins, supplements, minerals and
natural  and healthy living products, including NBTY, Amrion, Rexall Sundown and
Vitamin  Shoppe, some of which have already developed online retail outlets; and
direct  sales  organizations,  retail  drugstore chains, health and natural food
store  merchants, mass market retail chains and various manufacturers of natural
products.

DEPENDENCE  ON  MANAGEMENT

The Company is dependent on its management for substantially all of its business
activities, including the development of new products and the advancement of the
Company's  identity  and recognition in the nutritional supplement industry. The
loss  of  the  services of certain members of management such as Mr. Klee Irwin,
the  Chief  Executive  Officer,  could  have  a material effect on the business,
operations  and financial condition of the Company. The Company currently has no
long-term  agreement  with  any  executive  officer  or  key  employee.

                                        9
<PAGE>


Effective  March  12, 2000, both the Company's Chairman of the Board, R. Lindsey
Duncan and its President and Chief Executive Officer, Louis Mancini ceased to be
employed  by  the  Company.  Mr.  Mancini  was  replaced  by  Mr.  Klee Irwin as
President and Chief Executive Officer.  See Part III Item 10 for a discussion of
the  recent  changes  in  management  and  the terms of the severance agreements
between  such  individuals  and the Company.  At this time, the Company believes
that  such  changes  in  management  will  not  materially  adversely affect the
Company.

NO  LONG-TERM  CONTRACTS  WITH  MANUFACTURERS  OR  DISTRIBUTORS

The  Company  purchases  all  of  its  products  from  third-party manufacturers
pursuant  to purchase orders issued from time to time by the Company but without
any long-term manufacturing agreements. In the event that a current manufacturer
is  unable to meet the Company's manufacturing and delivery requirements at some
time  in the future, the Company may suffer interruptions of delivery of certain
products  while  it  establishes  an  alternative source. To limit the Company's
exposure  to  this  type  of  interruption,  for  all large volume products, two
third-party  manufacturers  have  been established. For smaller volume products,
the  selection  of  alternative  manufacturing  sources may be delayed while the
Company  completes  a review of the proposed manufacturer's quality control, raw
material  sources, and manufacturing and delivery capabilities. To help mitigate
any  interruption, the Company maintains a 60-90 day inventory on most products.

CUSTOMER  GUARANTY  OF  SATISFACTION;  RIGHT  OF  RETURN

In an effort to build customer confidence and satisfaction, the Company warrants
satisfaction and grants to its customers the right of return for full credit any
product  that  is  unsatisfactory to the customer or that is shelf-worn or stale
merchandise.  The  Company  has  had  this  policy  since  its  inception  and
experienced product returns of approximately 6.7% of gross sales in 1999.  There
can  be  no  assurance  that such a policy will not result in additional product
returns  in  the  future.

POTENTIAL  TRADEMARK  INFRINGEMENT

The  conduct  of the Company's business, in common with other sellers of branded
consumer  products,  may  involve  from  time  to  time  potential liability for
trademark  infringement.  The  Company  is  engaged  on  a  continuing  basis in
developing  brand  names for its new products, securing trademark protection for
brand  names  and  copyright  protection  for associated materials, policing its
existing  marks,  and  enforcing  its  legal  rights  in  cases  of  potential
infringement  by  third  parties  of its legally protected marks and copyrights.
Prior  to  commencing  advertising and sales of products under a newly developed
brand  name,  the  Company seeks to minimize the risks of potentially infringing
the  rights  of  third parties by conducting trade and service mark searches and
other  inquiries  in addition to filing publicly for trademark protection of the
brand  name  and  copyright  protection for associated advertising materials and
labeling.  The  Company registers for its principal product lines as well as its
principal products. Notwithstanding such efforts, there can be no assurance that
the  Company  will  not  suffer  adverse  financial  consequences as a result of
legally  established  third  party claims to first use of trade or service marks
used  by  the  Company.

IMPACT  OF  YEAR  2000

In  prior  years,  the Company discussed the nature and progress of its plans to
become Year 2000 ready.  In late 1999, the Company completed its remediation and
testing  of  systems.  As a result of those planning and implementation efforts,
the  Company  experienced  no  significant  disruptions  in  mission  critical
information technology and non-information technology systems and believes those
systems  successfully  responded  to  the  Year  2000  date change.  The Company
expensed  approximately  $25,000  during 1999 in connection with remediating its
systems.  The  Company is not aware of any material problems resulting from Year
2000 issues, either with its products, its internal systems, or the products and
services  of  third  parties.  The  Company will continue to monitor its mission
critical computer applications and those of its suppliers and vendors throughout
the  year  2000  to  ensure that any latent Year 2000 matters that may arise are
addressed  promptly.

                                       10
<PAGE>


ITEM  2.  PROPERTIES

The  Company's  principal  offices  are  located  at  5310 Beethoven Street, Los
Angeles,  California, 90066 in a building and warehouse leased by the Company at
a  monthly  rental  charge  of  $39,000. On November 1, 1999 the Company entered
into  a  five-year  lease  for  the office located in Broomfield, Colorado.  The
annual  rent  is  $3,724.08  and  is  subject to escalation (please see schedule
below).  In  addition, in 1999 the Company owned a building in Boulder, Colorado
and  leased  warehouse  space  in  Broomfield,  Colorado. On March 25, 1999, the
Company completed the sale of its former 4Health,Inc. corporate facility located
in  Boulder  Colorado  (the  "Property").  The  sale  price for the Property was
$2,350,000,  which consisted of (i) cash consideration of $600,000 that was paid
at  closing, (ii) assumption of a $1,300,000 existing first mortgage loan on the
Property  made by the buyer, and (iii) the receipt of a $450,000 promissory note
secured  by  a  second trust deed in the Property.  The note receivable is to be
paid  in  monthly  installments of $3,688, including principal and interest at a
rate  of 7 1/2% per annum, until March 1, 2002 when the note is payable in full.

In  November  1999  the  Company  entered  into  a  5  year lease of it's office
facilities  in  Broomfield,  Colorado.  The lease agreement calls for escalating
lease  payment  over  the  term  of  the  lease.

Schedule  of  Escalation  for
Broomfield,  Colorado  Office
-----------------------------
     Year  1          $29,456
     Year  2          $29,456
     Year  3          $31,560
     Year  4          $31,560
     Year  5          $32,612


LOCATION                        SIZE                   FUNCTION
--------                        ----                   --------
Los  Angeles,  California     52,000  sq.  ft.     Corporate  Headquarters  &
                                                   Distribution  Center
Broomfield,  Colorado          3,500  sq.  ft.     Midwest  Office

ITEM  3.  LEGAL  PROCEEDINGS

On  December  23,  1999,  a lawsuit was filed against the Company, the Company's
current  President  and  Chief  Executive Officer, Klee Irwin, and the Company's
former  President,  Louis  Mancini,  entitled David Mandel, Jeffrey D. Segal and
                                              ----------------------------------
Gordon  D.  Barker  v.  Omni Nutraceuticals, Inc., Klee Irwin, Louis Mancini and
   -----------------------------------------------------------------------------
Does  1  through  50  (Superior  Court of the State of California, County of Los
   -----------------
Angeles  -  Central  District, Case No. BC222263).  The lawsuit includes various
   -
causes of action, including fraud, negligent misrepresentation, misappropriation
of trade secrets, unjust enrichment, unfair business practices and violations of
the  Racketeer  Influenced  and  Corrupt  Organizations  Act (RICO) (under which
treble  damages  have  been  claimed).  The  lawsuit is based on various alleged
claims, including that the plaintiffs, the sole shareholders of Health & Vitamin
Express  ("HVE"),  were  fraudulently  induced  to enter into a merger agreement
pursuant  to  which HVE became a wholly-owned subsidiary of the Company based on
false  representations  of  the  defendants.  The  lawsuit  does not specify the
amount  of  damages claimed.  Although the Company believes that the claims made
in  the  lawsuit  are  without  merit,  the  Company  is currently in settlement
negotiations  with  the  plaintiffs  in the lawsuit.   The proposed terms of the
settlement  provide  that the Company will issue an additional 363,636 shares of
common  stock  to  the former shareholders of HVE.  Management and the Company's
legal  counsel  believe  that  the claims will be settled in accordance with the
proposed  settlement agreement.  As such, the Company has estimated and recorded
a  charge  of  $1,200,000  in  the  accompanying  statement  of operations as of
December  31,  1999,  in  connection  with  this  claim.

                                       11
<PAGE>


From  time to time the Company is a party to legal proceedings that it considers
routine  litigation  incidental  to  its  business. Management believes that the
likely outcome of such litigation will not have a material adverse effect on the
Company's  business  or  results  of  operations.

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

On December 22, 1999, a Special Meeting in Lieu of an Annual Meeting was held at
Omni  headquarters  for  the  following  purpose:  (i) to ratify an amendment to
Article  III  of  the Company's Bylaws eliminating Section 3.14 providing for an
Executive  Committee  of  the  Board  of  Directors;  (ii) to elect Mr. Santo P.
Panzarella  to  the  Board  of  Directors  of Omni Nutraceuticals as a Class III
director;  (iii)  to  ratify amendments to the Long Term Stock Incentive Plan of
Omni  Nutraceuticals increasing the number of shares of Common Stock that may be
awarded  under  the  Plan  to  4,500,000, including 1,000,000 shares that may be
granted  to  non-employee  directors; and (iv) to ratify the selection of Arthur
Andersen  LLP,  independent  public  accountants,  as  Omni  Nutraceuticals'
independent  auditors  for  the fiscal year 1999. The matters were voted upon at
the  meeting, and the number of votes cast for, against  or withheld, as to each
matter,  where  applicable,  are  set  forth  below.

<TABLE>
<CAPTION>

<S>                                                                           <C>            <C>            <C>
PROPOSAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  VOTES FOR   VOTES AGAINST  VOTES WITHHELD
--------------------------------------------------------------------------  ----------  -------------  --------------
To ratify an amendment to Article III of the Company's Bylaws. . . . . . .  22,350,092         31,890         130,950
To elect Mr. Santo P. Panzarella to the Board of Directors . . . . . . . .  22,062,992              -         449,940
To ratify amendments to the Long Term Stock Incentive Plan . . . . . . . .  21,625,572        755,610         131,750

To ratify selection of Arthur Andersen LLP, independent public accountants  24,469,070         41,962           1,900
</TABLE>


                                     PART II
                                     -------

ITEM  5.  MARKET  FOR  REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

The  Company's Common Stock commenced trading on the Nasdaq National Market tier
of  the  Nasdaq  Stock  Market under the stock symbol HHHH on July 17, 1996.  On
August  20,  1999,  the  Company  changed its stock symbol to OMNT.  On April 1,
2000,  the  Company  changed  its  symbol  to  ZONE.

The market price of Common Stock could be subject to significant fluctuations in
the future based on factors such as announcements of new products by the Company
or  its  competitors,  quarterly  fluctuations  in  the  Company's  financial
performance,  the  results of the Company's marketing and sales efforts, general
conditions  in  the  dietary  and  nutritional  supplements industry, changes in
analysts'  estimates  of  the Company's financial performance, conditions in the
financial markets or other factors which are currently unforeseen by management.
There  can  be  no assurance that the market price for the Common Stock will not
decline  from  current  levels,  or  otherwise  not  be  subject  to significant
fluctuations  in  the  future.

                                       12
<PAGE>


The  high  and low closing bid prices reported for the period between January 1,
1998  and  March  31,  2000  appear  in  the  following  table:

<TABLE>
<CAPTION>



<S>                        <C>                       <C>                          <C>
FISCAL YEAR              QUARTER                     HIGH                         LOW
1998                       1st                      $5.875                       $4.500
1998                       2nd                      $9.500                       $4.875
1998                       3rd                      $7.500                       $2.750
1998                       4th                      $6.938                       $3.000
1999                       1st                      $8.000                       $3.438
1999                       2nd                      $2.500                       $1.500
1999                       3rd                      $2.500                       $1.500
1999                       4th                      $2.313                       $1.125
2000                       1st                      $8.625                       $1.375
2000                       2nd (through 4/10/00)    $7.375                       $3.75
</TABLE>

As of March 29, 2000, there were approximately 187 stockholders of record of the
Company's Common Stock, exclusive of stockholders who hold title to their shares
in  street  name.

SALES  OF  RESTRICTED  SECURITIES

During the year ended December 31, 1999, and subsequently, the Company completed
the  following  transactions:

On  February 15, 1999, the Company acquired by way of a merger with and into its
California subsidiary, HealthZone.com, Health & Vitamin Express, Inc. ("HVE"), a
California  on-line  retailer  of  health  products,  in  consideration  for the
issuance  of  363,636  shares of common stock of the Company issued in a private
placement  to  the  three  shareholders of HVE.  The shares were issued to three
shareholders  of HVE in a transaction intended to qualify for the exemption from
registration afforded by Section 4(2) of the Securities Act of 1993 and Rule 506
promulgated  thereunder.  Refer to March 31, 1999 quarterly report filed on Form
10Q.

During  the  year  ended  December 31, 1999, the Company issued 53,000 shares of
common  stock  valued  at  prices  ranging  from  $1.43  to  $2.37  per share to
consultants  and  to  settle  certain  obligations.  The shares were issued in a
transaction  intended  to  qualify for the exemption from registration under the
Securities  Act  of  1933,  as  amended,  afforded  by  Section  4(2)  thereof.

On  January  5, 2000, as compensation for serving on the Board of Directors, the
Company  issued to each of Mr. Jonathan Diamond, Mr. Andrew Volloro Jr., and Mr.
Mr. Santo P. Panzarella 25,000 restricted shares of the Company's $.01 par value
common  stock.  The  shares were issued in a transaction intended to qualify for
the  exemption  from  registration under the Securities Act of 1933, as amended,
afforded  by  Section  4(2)  thereof.

                                       13
<PAGE>


On  January  24,  2000,  the Company completed an equity transaction whereby the
Company  agreed  to  issue, at its election, up to 4,500,000 shares of its newly
created 5% Convertible Preferred Stock, Series A ("Preferred Shares ") and seven
year  warrants  to purchase up to an aggregate of 775,000 shares of common stock
at  an  exercise  price of $2.25 per share, subject to adjustment. The aggregate
purchase  price  for the Preferred Shares and warrants was $4,000,000 payable in
two  installments,  the  first  in  the  amount of $2,000,000 that was funded on
January  21,  2000,  and  subject  to  the  satisfaction  of certain performance
targets,  the  second  in the amount of $2,000,000.  Concurrently with the first
installment payment, the Company's Internet subsidiary,  HealthZone.com,  issued
222,222  shares  of  its common stock and a seven year warrant to purchase up to
37,000  shares  of  its common for a purchase price of $1,000,000.  On March 24,
2000,  the Company converted the Preferred Shares into an aggregate of 2,016,438
shares  of  common  stock  pursuant to the mandatory conversion provision of the
Preferred Shares.  The investor was also provided certain registration rights in
connection  with  this  transaction.

On  March  12,  2000, the Company entered into a two year  Consulting  Agreement
with  Liviakis  Financial  Communications,  Inc.  ("LFC")  and,  in  connection
therewith,  authorized  the  issuance  of  1,200,000  restricted  shares  of
Common  Stock  to  LFC  in  consideration  of,  and as a retainer and prepayment
for,  the  consulting  services  to  be  rendered  to  the  Company  by  LFC.
Pursuant  to  the  provisions  of  the  Consulting  Agreement,  LFC  will  be
entitled  to  receive  a  2.5%  finder's  fee in connection  with  any  debt  or
equity  financing  for the Company from a source introduced  to  the  Company by
LFC  and a 2% finder's fee in connection with any acquisition  by  the  Company,
or  its  nominee, of a candidate introduced to the Company  or  its  nominee  by
LFC.  The  Company  also  agreed  to  reimburse  LFC for extraordinary  expenses
incurred  by  LFC  on  behalf  of  the  Company  with  its  permission.

On  March 27, 2000, the Company sold 700,000 shares of common stock in a private
placement  for  aggregate  proceeds  of $2,100,000.  The shares were issued in a
transaction  intended  to  qualify for the exemption from registration under the
Securities  Act  of  1933,  as  amended,  afforded by Section 4(2) thereof.  The
investor  was  also provided certain registration rights in connection with this
transaction.

DIVIDEND  POLICY

The Company has never paid dividends with respect to the Company's Common Stock.
There  are  no  restrictions  on  the declaration or payment of dividends in the
articles of incorporation or bylaws of the Company, however, for the foreseeable
future,  the  Board of Directors intends to retain all of the Company's earnings
for  use  in  the  expansion  of  the  Company's  business.  The Company is also
currently  prescribed  from issuing cash dividends on its Common Stock under the
terms  of  its  Credit  Facility  with  its  bank.

REGISTRAR  AND  TRANSFER  AGENT

The  registrar  and  transfer  and  warrant  agent  for  the Company is American
Securities  Transfer  and  Trust,  938  Quail  Street,  Suite 101, Lakewood, CO,
80215-5513,  telephone  number  (303)  234-5300.

ITEM  6.  SELECTED  FINANCIAL  DATA

The  following  selected statements of operations data for the three years ended
December  31,  1999,  1998  and  1997  and the selected balance sheet data as of
December  31,  1999  and  1998  have  been  derived  from  the audited financial
statements of the Company included herein ("Financial Statements"). The selected
statements of operations data for the two years ended December 31, 1994 and 1995
and  the selected balance sheet data as of December 31, 1994, 1995, and 1996 has
been  derived  from  audited  financial  statements  of the Company not included
elsewhere  herein. The selected financial data set forth below should be read in
conjunction  with  "Management's  Discussion and Analysis of Financial Condition
and  Results  of  Operations"  and  the  Financial  Statements and notes thereto
included  elsewhere  in this Form 10-K. Certain amounts in prior years have been
reclassified  to  conform  to  current  year  presentation.

                                       14
<PAGE>


                            YEARS ENDING DECEMBER 31
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>



<S>                                                             <C>       <C>       <C>       <C>        <C>
STATEMENT OF OPERATIONS DATA                                   1999      1998      1997      1996       1995
Net sales                                                    $35,308   $30,547   $29,353   $28,592    $12,824
Gross profit                                                  17,461    18,007    16,050    16,266      7,620
Operating (loss) income                                       (8,306)    1,827    (4,638)   (1,298)     1,342
Other income (expense), net                                     (829)     (209)      (79)      101        (76)
Income (loss) before provision for income taxes               (9,135)    1,618    (4,717)   (1,197)     1,266
Provision for income taxes                                      (274)      600        --       594        360
Net income (loss)                                             (8,861)    1,018    (4,717)   (1,791)       906
Pro forma provision for income taxes (unaudited)                 N/A     1,345       765       N/A        439
Pro forma net income (loss) (unaudited)                          N/A       273    (5,482)      N/A        827
PER SHARE DATA:
Historical
Earnings (loss) per common share
-- Basic and diluted                                         $ (0.31)  $  0.04   $ (0.17)  $ (0.07)    $ 0.04
Pro forma
Earnings (loss) per common share
-- Basic and diluted (unaudited)                             $ (0.31)  $  0.01   $  (.20)      N/A     $ 0.03
Historical

Weighted average number of shares of common
stock outstanding--Basic                                      28,177    27,747    27,365    25,647      24,457

Weighted average number of shares of common
stock Outstanding Diluted                                     28,177    28,221    27,365    25,647      24,583
Pro forma

Weighted average number of shares of common
stock outstanding -- Basic (unaudited)                           N/A    27,747    27,365      N/A       24,457

Weighted average number of shares of common
stock outstanding -- Diluted (unaudited)                         N/A    28,221    27,365      N/A       24,583

</TABLE>

                                      YEARS  ENDING  DECEMBER  31
                                          (in  thousands)

<TABLE>
<CAPTION>



<S>                                        <C>        <C>      <C>      <C>      <C>
BALANCE SHEET DATA. . . . . . . . . . .     1999      1998     1997     1996    1995
                                         --------  -------  -------  -------  ------
Working Capital (Deficit) . . . . . . .  $(6,364)  $ 4,395  $ 3,588  $ 4,843  $2,385
Total Assets. . . . . . . . . . . . . .   31,727    13,087   11,337   15,832   5,786
Long Term Debt, Net of Current Portion.   10,187     1,423    1,298    1,276   1,296
Shareholders' Equity. . . . . . . . . .    1,878     5,869    5,387   10,256   3,205
</TABLE>

                                       15
<PAGE>


ITEM  7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF  OPERATIONS

REFERENCE  IS  HEREBY  MADE  TO  THE  DISCLOSURE  REGARDING  "FORWARD-LOOKING"
STATEMENTS  ON  PAGE  3.

On  August  19,  1999  Irwin  Naturals/  4  Heath Inc. filed an amendment to its
Articles  of  Incorporation  changing its name to Omni Nutraceuticals, Inc. (the
"Company").  The Company is a formulator and supplier of branded natural health,
herbal  and  nutritional  supplement  products.  The Company's products are sold
through mass retail, specialty natural health, nutrition and food retail stores.
On  February  15,  1999,  the  Company  acquired  Health & Vitamin Express, Inc.
("HVE"), an on-line retailer of health products.  On March 10, 1999, the Company
acquired  certain  assets  and  liabilities  of Inholtra Investment Holdings and
Trading,  N.V.,  Inholtra  Inc.  and  Inholtra  Natural,  Ltd.

The  following  table  sets  forth, for years 1999, 1998 and 1997, certain items
from the Company's Statements of Operations included elsewhere herein, expressed
as  a  percentage  of  net  sales.


                        YEARS  ENDING  DECEMBER  31

<TABLE>
<CAPTION>



<S>                                                     <C>      <C>     <C>
                                                        1999    1998     1997
                                                      -------  ------  -------
Net Sales. . . . . . . . . . . . . . . . . . . . . .     100%  100.0%   100.0%
Cost of Sales. . . . . . . . . . . . . . . . . . . .    50.5%   41.0%    45.3%
Gross Profit . . . . . . . . . . . . . . . . . . . .    49.5%   59.0%    54.7%
Operating Expenses . . . . . . . . . . . . . . . . .    67.7%   53.0%    59.6%
Loss on write-off of Goodwill/Surgical Technologies      ---     ---     10.9%
Loss on Intangibles                                      1.9%    ---      ---
Legal Settlement                                         3.4     ---      ---
Income (loss) from operations. . . . . . . . . . . .  (23.5)%    6.0%  (15.8)%
Other income (expense), net. . . . . . . . . . . . .   (2.3)%  (0.7)%   (0.3)%
Income (loss) before provision for income taxes. . .  (25.8)%    5.3%  (16.1)%
Provision Benefit for income taxes                      (.7)%    2.0%     ---
Net income (loss). . . . . . . . . . . . . . . . . .  (25.1)%    3.3%  (16.1)%
                                                      =======  ======  =======
</TABLE>


RESULTS  OF  OPERATIONS

1999  COMPARED  TO  1998

Operating  Results
------------------

Consolidated  net  sales  for  the year ended December 31, 1999 were $35,308,000
with an operating loss of $8,306,000 and a net loss of ($8,861,000), or $.31 per
basic and diluted share. Consolidated net sales for the same period in the prior
year  were  $30,547,000  with  operating  income of $1,827,000 and net income of
$1,018,000  , or $.04 per basic and $.01 per diluted share. The net loss for the
year  was  impacted  by:  a  $  634,000  loss  in  operations from the Company's
Internet  subsidiary  HealthZone.com  ("HealthZone"), goodwill  amortization  of
$640,000,  a  $640,000 loss incurred with the write off of intangibles, non-cash
warrant and option compensation costs of $903,000  and  $288,000  related to the
relocation  of  the  Company's  corporate  and  warehouse  facilities.

                                       16
<PAGE>


Net  sales  for  the  year  ended  December 31, 1999 increased by $4,761,000, or
15.6%,  to  $35,308,000  from $30,547,000 for the comparable period in 1998. The
increase  in  sales  relates  primarily to the introduction of the Company's new
Inholtra  pain  relieving  product, as well as an overall increase in certain of
the  Company's  base  product  lines.

Gross  profit  for the year ended December 31, 1999 decreased $546,000, or 3.1%,
to  $17,461,000  from  $18,007,000  for  the  comparable  period  in 1998. Gross
profits  as a percentage of sales for the year ended December 31, 1999 decreased
to  49.5%  from  59.0%  in  the  comparable period in 1998.  The decrease in the
margin  relates  to:  (i) pricing concessions offered during 1999 in conjunction
with  the  launch  and  early  stage  sales  of several new products, (ii) sales
adjustments  given  to  certain customers, and (iii) an overall shift in product
mix  to  certain  items  which  have  a  slightly  lower  margin.

Sales  and marketing expenses for the year ended December 31, 1999, increased by
$2,838,000 or 41.8%, to $9,631,000 from $6,793,000  for the comparable period in
1998.  The  increase  primarily  relates  to  wages, advertising and other costs
incurred  on  marketing  and  media  campaigns to (i) launch the introduction of
Inholtra,  (ii)  launch  the Company's new products, Cholestaid and Veromax, for
the  fourth  quarter 1999 and fiscal 2000, (iii) media and advertising campaigns
to  support  certain  of  the  Company's  other  products,  and  (iv)  continual
repackaging  and  redesign  of  the  Company's  core  product  lines.

General  and  administrative  expenses  for  the  year  ended December 31, 1999,
increased  by $333,000, or 3.5% to $9,720,000 from $9,387,000 for the comparable
period  in 1998. Included in 1999 general and administrative expenses were:  (i)
legal  and professional fees of $806,000, (ii) $717,000 in costs incurred on the
Company's  HealthZone  operations, (iii) $415,000  for consulting costs incurred
to  implement  the  Company's  acquisition of Inholtra and other products,  (iv)
approximately  $1,136,000  in  bad  debts  (v)  $903,000 of non-cash warrant and
compensation costs, and (vi) a  $300,000 charge related to the relocation of the
Company's  corporate  and  warehouse  facilities.

Depreciation and amortization for the year ended December 31, 1999, increased by
$987,000  to  $1,890,000  from  $903,000 for the comparable period in 1998.  The
increase specifically relates to amortization costs relating to the Inholtra and
HVE  acquisitions.

Interest expense for the  year ending December 31, 1999 increased $1,176,000  to
$1,339,000  from  $163,000  for  the comparable period in 1998. This increase is
consistent with the increase in the utilization of the Company's line of credit,
the  incurrence  of  the Inholtra acquisition debt and the term loan incurred to
refinance  the  Inholtra  acquisition  debt  in  1999.  Other  income included a
$481,000  gain on the sale of the former 4Health corporate headquarters building
located  in  Boulder,  Colorado.

1998  COMPARED  TO  1997

Net  Sales  for  the  year  ended  December  31,  1998  rose to $30,547,000 from
$29,353,000,  an  increase  of 4.1% when compared to 1997. Several products were
repositioned  and  remarketed after the merger as a result of management's focus
on  optimizing  each  product's  potential.  This  repositioning  resulted  in a
one-time reduction of $387,000 (1.3%) in net sales. The improvement in net sales
between  periods  was  due primarily to an increase in the Mass Market business,
with  strong  first  quarter  sales  indicative  of  a high level of interest in
several  major  products  introduced  in  the  last half of 1997, greater market
penetration,  and  a  strong focus on expanding into drug and discount chains in
the  second,  third, and fourth quarters. In addition, the last half of the year
saw  the  promising  early signs of acceptance of the Company's newly introduced
Nutrition Bar. The relatively stable health food store sales are a reflection of
continued  competitive  pressures  and an overall weakness in this sector of the
marketplace.  International  sales  improved  over  1997  as the newly installed
International  Sales Division staff expanded strongly into several new strategic
markets.

                                       17
<PAGE>


Gross  Profit  Margins  rose to $18,007,000 in 1998 from $16,050,000 in 1997, an
increase of 12.2%. The post-merger product re-positioning resulted in a one-time
$172,000  (1.1%)  decrease in Gross Margins. Gross Margin as a percentage of net
sales  increased  to 58.9% of net sales in 1998 from 54.7% of net sales in 1997.
This increase was due primarily to an improved product sales mix, and reflective
of  continued  internal efforts to lower the cost of the core products. Improved
margins  were  particularly evident in the Nature's Secret-Registered Trademark-
and  Harmony  Formula-Registered  Trademark-  branded  products.

Sales  and  marketing expenses for the year ended December 31, 1998 decreased by
$3,050,000, or 31.0% to $6,793,000 from $9,843,000  for the comparable period in
1997.  Much  of  the decrease in Sales and Marketing expense was attributable to
the  synergies  achieved  as  a  result  of  the  merger.

General  and  administrative  expenses  for  the  year  ended December 31, 1998,
increased  by  $1,744,000  ,  or  22.8%  to  $9,387,000 from $7,643,000  for the
comparable  period  in  1997. The 1998 General and Administrative expenses, when
adjusted  for  merger  related  expenses  of  $1,614,000, were $7,773,000, a net
increase of $130,000 compared to the 1997 General and Administrative expenses of
$7,643,000.  Included in the 1997 General & Administrative expenses are Research
&  Development (R & D) expenses of $418,000. R & D expenses decreased to $29,000
in  1998  as  the  Company  relied  on existing, developed products. Much of the
remainder of the decrease was attributable to the synergies achieved as a result
of  the  merger.

During  1997,  the  Company  wrote  off  goodwill in the amount of $3,202,000 in
connection with the 1996 merger with SGTI. There was no similar expense in 1998.

 LIQUIDITY  AND  CAPITAL  RESOURCES

During  the  year ended December 31, 1999, the Company experienced negative cash
flow  from  operations  of  $2,485,000  and  utilized  another  $14,270,000  for
investing  activities,  of  which  $13,493,000  was  used  for acquisitions.  To
finance the above, the Company utilized its existing credit facilities, issued a
$10,000,000  promissory note payable, and issued 363,636 shares of the Company's
common  stock.

On  June  10,  1999,  the Company secured a loan from a lending institution that
will  provide  up  to  $20  million  dollars  of  financing. The credit facility
consists  of  a  $13  million  term  loan  ("Term  Loan") and up to a $7 million
revolving  loan  ("Revolving  Loan"), subject to borrowing base availability and
compliance  with  certain  financial  and  other  covenants  and agreements.  At
closing,  $4,527,000  of  loan  proceeds  were  disbursed to repay and close the
Company's  previous  existing  credit facility, and $10,000,000 was disbursed to
repay  the  promissory  note  incurred in connection with the acquisition of the
Inholtra  assets.  The remainder of the available financing will be used to fund
the  Company's  on-going  working  capital  requirements.

The  loans under the facility are secured by substantially all the assets of the
Company.  Borrowings  under  the  Term  Loan  bear interest at an annual rate of
either prime plus 2.25 percent or LIBOR plus 3.75 percent and is paid quarterly.
Borrowings under the Revolving Note currently bear interest at an annual rate of
either  prime plus 1.75 percent or LIBOR plus 3.0 percent and is paid quarterly.
The  rates  are  subject  to  decrease  based upon the Company obtaining certain
operating  performance levels. The Revolving Loan commitment expires on June 15,
2004,  when  the  loan  is payable in full. As of December 31, 1999, the maximum
additional  available credit under the borrowing limitations was $564,000.   The
$13,000,000 Term Loan is payable in quarterly installments of $583,333 beginning
October 15, 1999, which will increase to $750,000 on October 15, 2002, until the
Loan  is  paid  in full on April 15, 2004. In addition, the Company shall make a
payment  of  principal on the Term Loan in addition to the quarterly payments in
an  amount equal to 50% of "Excess Cash Flow" (as defined) for each fiscal year.
Furthermore,  the  Company  would  be  required  to  apply receipt of any equity
infusion,  loan  proceeds  or  proceeds  from  other non-operating activities to
reduce  the  outstanding  debt.

                                       18
<PAGE>


The  credit facility agreement contains certain financial and other covenants or
restrictions, including the maintenance of certain financial ratios, limitations
on  capital  expenditures,  restrictions  on  acquisitions,  limitations  on the
incurrence  of  indebtedness  and restrictions on dividends paid by the Company.
The  Company  was  out  of  compliance  with  certain of the financial ratios at
December  31,  1999 and secured waivers from its lender for such non-compliance.
As  a  condition of the waiver, the Term Loan and Revolving Loan agreements will
be  amended to change the expiration dates of both facilities to April 30, 2001.
There is no assurance that the Company will continue to have the available funds
necessary  to  meet  its  next  required  payment,  unless  the Company achieves
profitable operations, refinances its indebtedness, receives an equity infusion,
modifies  the  covenants,  or  obtains  waivers  from  the bank. There can be no
assurances  that  such level of profitable operations can be achieved, that such
refinancing  or  equity  will be available on terms satisfactory to the Company,
that  the bank agrees to modify the covenants, or such waivers will be obtained.
Future  losses  or the inability to refinance or to complete an equity placement
may  result  in  further  renegotiations  of  such covenants or the need to seek
replacement  financing.

If  the  Company fails to invest or contribute to its HVE operations $10,000,000
during  the  36  months  subsequent  to  February  15,  1999, the Company may be
obligated to issue up to 363,636 additional shares of the Company's common stock
to  the  sellers.  A  legal  proceeding  has  been  commenced  by  the  former
shareholders of HVE against the Company  and  certain  of its current and former
officers  regarding  an alleged failure by the Company to fund HVE.  The Company
is  currently  in  settlement  negotiations  with the plaintiffs in this action.
(See  Other  Information,  Item  1,  Legal  Proceedings)

The  Company  has  primarily  funded  its  operations to date through internally
generated  capital,  bank  financing  or  sales of its securities. The Company's
future  capital  requirements  will depend on many factors, including the nature
and  timing  of  orders from customers, collection of trade accounts receivable,
the  expansion  of  sales  and marketing efforts, costs associated with entering
into  new  channels  of  distribution,  and  the status of competitive products.

The  Company  was notified by the Nasdaq Stock Market in September 1999 that the
Company  failed to meet the minimum tangible net asset requirement necessary for
continued  listing  on  the  Nasdaq  National  Market.  The  Company presented a
specific plan to Nasdaq for achieving compliance with all Nasdaq National Market
listing  requirements,  including  the  sale  of the convertible preferred stock
described  below  and  a capital contribution of $305,000 made to the Company by
Mr.  Klee Irwin, first on or about October 8, 1999 and then at a hearing held on
February 10, 2000. On March 15, 2000, the Company was notified by Nasdaq that it
had  met  one  of  the  alternative  maintenance  standards  by virtue of having
exceeded  a  $5  minimum  bid price for its common stock for the ten consecutive
trading days ending March 10, 2000, and, accordingly, Nasdaq had closed the file
with respect to the possible delisting of the Company's common stock.  There can
be no assurance that the Company will continue to meet such listing requirements
in  the  future.

                                       19
<PAGE>


SUBSEQUENT  EVENTS

Subsequent  to  December  31,  1999,  the  Company  completed  two  transactions
involving the sale of equity securities, which resulted in aggregate proceeds of
$4,100,000  to  the Company and $1,000,000 to its subsidiary HealthZone.com.  On
January  24,  2000,  the  Company  completed  an  equity transaction whereby the
Company  issued  up  to  4,500,000  shares  of  its newly created 5% Convertible
Preferred  Stock,  Series  A  ("Preferred  Shares")  and  seven year warrants to
purchase  up  to  an  aggregate of 775,000 shares of common stock at an exercise
price  of  $2.25 per share, subject to adjustment.  The aggregate purchase price
for  the  Preferred  Shares  and  warrants  sold  by  the Company in the initial
installment  was  $2,000,000.  Concurrently  with the first installment payment,
HealthZone issued 222,222 shares of its common stock and a seven year warrant to
purchase  up  to 37,000 shares of its common for a purchase price of $1,000,000.
On  March  24,  2000,  all  of  the issued and outstanding Preferred Shares were
mandatorily converted into 2,016,438 shares of common stock.  On March 29, 2000,
the Company completed a private sale of its securities whereby 700,000 shares of
common  stock  of  the  Company  were  sold  for  an aggregate purchase price of
$2,100,000.  The  Company  used  the proceeds from the sale of its securities to
reduce  indebtedness  and  for  working  capital  purposes.

Management  believes  that  additional  investment  capital  will be required to
permit  the  Company  to  meets  its business objectives in the near term.  Such
funds  may be raised either through debt or equity offerings or some combination
of  the  two,  however,  there  is no assurance that the Company will be able to
secure  such  funds  on  commercially  reasonable  terms,  if  at  all.  If  not
successful in securing additional funds, the Company may be forced to dispose of
its  assets outside of its normal course of business and/or resort to bankruptcy
protection.

SEASONALITY  AND  QUARTERLY  FLUCTUATIONS

The  business  is  to  some  extent  cyclical,  but  not  necessarily  seasonal.

The following table sets forth, certain unaudited results of operations for each
quarter during 1998 and 1999. The unaudited information has been prepared on the
same  basis  as  the  audited  financial  statements appearing elsewhere in this
report and includes all adjustments, consisting of normal recurring adjustments,
which  management  considers  necessary for a fair presentation of the financial
data shown. The operating results for any quarter are not necessarily indicative
of  the  results  to  be  attained  for  any  future  period.


                              QUARTERS  ENDED  1999

<TABLE>
<CAPTION>



<S>                                                 <C>          <C>           <C>             <C>            <C>
                                                   MARCH 31     JUNE 30       SEPTEMBER 30    DECEMBER 31    TOTAL
                                                  -----------  ------------  --------------  -------------  ------------
Net sales. . . . . . . . . . . . . . . . . . . .  $7,921,000   $ 8,372,000   $   9,949,000   $  9,066,000   $35,308,000
Gross profit . . . . . . . . . . . . . . . . . .   4,144,000     4,837,000       5,220,000      3,260,000    17,461,000
Loss from operations . . . . . . . . . . . . . .    (596,000)   (2,231,000)       (160,000)    (5,319,000)   (8,306,000)
Other income (expense), net. . . . . . . . . . .     411,000      (361,000)       (414,000)      (465,000)     (829,000)
                                                  -----------  ------------  --------------  -------------  ------------
Loss before provision (benefit) for income taxes    (185,000)   (2,592,000)       (574,000)    (5,784,000)   (9,135,000)
Benefit for income taxes . . . . . . . . . . . .          --      (129,000)       (113,000)       (32,000)     (274,000)
                                                  -----------  ------------  --------------  -------------  ------------
Net loss . . . . . . . . . . . . . . . . . . . .  $ (185,000)  $(2,463,000)  $    (461,000)  $ (5,752,000)  $(8,861,000)
                                                  ===========  ============  ==============  =============  ============
Net loss per common
  share-Basic and Diluted. . . . . . . . . . . .  $    (0.01)  $     (0.09)  $       (0.02)  $      (0.20)  $     (0.31)
                                                  ===========  ============  ==============  =============  ============
</TABLE>


                             QUARTERS  ENDED  1998

<TABLE>
<CAPTION>



<S>                                                  <C>          <C>           <C>             <C>            <C>
                                                  MARCH 31     JUNE 30       SEPTEMBER 30    DECEMBER 31    TOTAL
                                                  -----------  ------------  --------------  -------------  ------------
Net sales. . . . . . . . . . . . . . . . . . . .  $8,746,000   $ 7,013,000   $   7,225,000   $  7,563,000   $30,547,000
Gross profit . . . . . . . . . . . . . . . . . .   5,223,000     3,835,000       4,280,000      4,669,000    18,007,000
Loss from operations . . . . . . . . . . . . . .   1,610,000    (1,178,000)        988,000        407,000     1,827,000
Other (expense) income, net. . . . . . . . . . .      (7,000)      (41,000)        (64,000)       (97,000)     (209,000)
                                                  -----------  ------------  --------------  -------------  ------------
(Loss) before provision (benefit) for
  income taxes . . . . . . . . . . . . . . . . .   1,603,000    (1,219,000)        924,000        310,000     1,618,000
Provision (benefit) for income taxes . . . . . .     (34,000)      (45,000)             --        679,000       600,000
                                                  -----------  ------------  --------------  -------------  ------------
Net (loss) . . . . . . . . . . . . . . . . . . .  $1,637,000   $(1,174,000)  $     924,000   $   (369,000)  $ 1,018,000
                                                  ===========  ============  ==============  =============  ============
Net (loss) per common share-- Basic and Diluted.  $     0.06   $     (0.04)  $        0.03   $      (0.01)   $     0.04
                                                  ===========  ============  ==============  =============   ===========
</TABLE>

                                       20
<PAGE>


NEW  AUTHORITATIVE  PRONOUNCEMENTS

In  December  1999,  the  SEC staff released Staff Accounting Bulletin (SAB) No.
101,  Revenue  Recognition, to provide guidance on the recognition, presentation
and  disclosure  of  revenue  in financial statements.  Changes in accounting to
apply the guidance in SAB No. 101 may be accounted for as a change in accounting
principle  effective  January  1,  2000.  Management  has not yet determined the
complete  impact  of SAB No. 101 on the Company; however, management does expect
that  application  of  SAB  No. 101 will have a material effect on the Company's
revenue  recognition  and  results  of  operations.

INFLATION

Management  believes  that  the  effect of inflation will not have a significant
impact  on  the  Company's  financial  position  or  results  of  operations.


ITEM  7A.     QUANTITATIVE  AND  QUALITATIVE  DISCLOSURE  ABOUT  MARKET  RISK

The Company's primary market risk exposure is interest rate risk. As of December
31,  1999,  all  of  the  Company's  debt  obligations  were subject to variable
interest  rates.  The Company will monitor the level of risk by keeping variable
rate  exposures  at  acceptable  levels.

ITEM  8.     FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA

The  following  Financial  Statements are filed with this Annual Report as pages
F-1 through F-23.  The Index to Financial Statements appears on page F-1 of this
Annual  Report.

     Report  of  Independent  Public  Accountants
     Balance  Sheet
     Statements  of  Operations
     Statements  of  Shareholders'  Equity
     Statements  of  Cash  Flows
     Notes  to  Financial  Statements

ITEM  9.  CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING AND
FINANCIAL  DISCLOSURE

The  Company  has  notified  Arthur  Andersen  LLP that they will be replaced by
another  firm  upon  completion of the 1999 audit. The Company does not have any
disagreement  with its accountants regarding accounting or financial disclosure.
When auditing our consolidated financial statements for the year ending December
31,  1999,  our  independent  auditors  reported  conditions they believed to be
material weaknesses in the Company's system of internal accounting and financial
controls.  In response, management has begun to identify measures to improve the
Company's  system  of  internal  controls,  including implementing more rigorous
internal  accounting  policies,  procedures  and controls.   Management believes
these  improved  procedures  should  correct  the  noted  weaknesses.

                                       21
<PAGE>


                                    PART III
                                    --------

ITEM  10.     DIRECTORS  AND  EXECUTIVE  OFFICERS  OF  THE  REGISTRANT

The  following  table  lists  the  names,  ages,  and positions of the Company's
directors,  executive officers and other significant employees who were employed
by  the  Company  in  1999.

<TABLE>
<CAPTION>

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

NAME. . . . . . . . . . .  AGE  OFFICER SINCE  DIRECTOR SINCE  POSITION
-------------------------  ---  -------------  --------------  -----------------------------------------------
Mr. Andrew Vollero, Jr. .   63           1999            2000  Chairman of the Board
Mr. Klee Irwin. . . . . .   34           1998            1998  President and Chief Executive Officer, Director
Mr. Albert Kashani. . . .   40              -            2000  Director
Mr. Christof Ballin . . .   35              -            2000  Director
Mr. Marty Sumichrast. . .   58              -            2000  Director
Mr. R. Lindsey Duncan (1)   37           1993            1993  Chairman of the Board, Director
Mr. Louis Mancini (2) . .   54           1999            1999  President and Chief Executive Officer, Director
Mr. Jonathan Diamond (3).   41              -            1998  Director
Mr. James Jeffs (4) . . .   49              -            1998  Director
Mr. Santo Panzarella (5).   60              -            1999  Director
</TABLE>

    (1)     Served as Chairman of the Board and a Director until  March 12, 2000
    (2)     Served  as  a Director until October  1999.  Served as President and
            Chief Executive  Officer  April  20,  1999  until  March  12,  2000.
    (3)     Served  as  a  Director  until  March  3,  2000
    (4)     Served  as  a  Director  until  July  1999
    (5)     Served  as a Director from December 22, 1999 until February 20, 2000

Mr.  Andrew Vollero, Jr.  became Chairman of the Board of Omni Nutraceuticals on
March  12,  2000,  and  has  served as a Director since 1999.  Mr. Vollero is an
independent  general  management consultant and private investor specializing in
the  small business area since 1970.  During that period, Mr. Vollero has worked
with  over 100 companies, mostly privately held and in non-high tech industries.
Since  1994,  Mr. Vollero has served as a Board member of AC International, A.C.
Vroman,  Inc.,  Vroman Real Estate Ventures, Magnum Air and Rahn Industies.  Mr.
Vollero  is  a  graduate  of  Yale  and  Harvard  Business  School.

 Mr.  Klee Irwin.  Mr. Irwin served as the President and Chief Executive Officer
of  Omni  Nutraceuticals  from June 30, 1998 until April 20, 1999. Prior to June
30, 1998, Mr. Irwin served as the President and Chief Executive Officer of Irwin
Naturals,  which he founded in 1995. Prior to his involvement in Irwin Naturals,
beginning  in  1989, Mr. Irwin served as a vice president of sales and marketing
and general manager of Helsneva Labs, a division of Pantron I Corp., a privately
held  consumer products company. Mr. Irwin served as the Chief Executive Officer
and  a  Director  of HealthZone.com, the Company's e-commerce subsidiary in 1999
and  rejoined  Omni  as the Chief Executive Officer and President in March 2000.

Mr.  Albert  Kashani.  Mr.  Kashani became a director on March 12, 2000.  He has
been  specializing  in  transactional and business litigation matters at his own
practice,  the  Law Offices of Albert R. Kashani.  From 1991 to the present, Mr.
Kashani  has  been  a  principal executive officer of Menorah Fusing & Services,
Inc., a clothing interlining business, and its predecessors.  From 1995 to 1998,
Mr. Kashani was a tax consultant at Ernst & Young, LLP in Los Angeles.  In 1988,
Mr. Kashani founded Torina, Inc., a clothing manufacturing company.  Mr. Kashani
received  his  Bachelor  of  Arts  degree  in  Economics  from  California State
University,  Northridge,  in  1992,  and  graduated  from University of Southern
California  Law  Center in 1995.  Mr. Kashani is currently a member of the Board
of Directors of two other publicly traded companies, named Electronic Components
&  Systems,  Inc.  and  Integrated  Communication  Networks,  Inc.

                                       22
<PAGE>


Mr.  Christof  Ballin.  Mr. Christof Ballin became a director on March 12, 2000.
He  graduated from California State University Fullerton with a Bachelor of Arts
degree in International Business.  He has over 10 years of management experience
within  the healthcare field and is a former Managing Director, South East Asia,
of  Allergan,  Inc.,  which  is a U.S. Fortune 500 Specialty Healthcare Company.
Mr.  Ballin  is  currently  the  Chairman  and  CEO  of  the American Academy of
Nutrition,  College  of  Nutrition  which  is  a  Nationally Accredited Distance
Education  College  focused  on  the  field  of  Nutrition.

Mr.  Martin  A. Sumichrast.  Mr. Sumichrast became a director on March 12, 2000.
He  is  the  co-founder,  Chairman  of  the  Board,  Chief Executive Officer and
President  of  Global  Capital  Partners,  Inc.  Mr. Sumichrast has held various
positions  at  Global  Capital  Partners, Inc. since its inception in 1993.  Mr.
Sumichrast  is  a  Director  of  EB  I  Securities  Corporation  and Chairman of
MoneyZone.com.

Mr.  James  Jeffs.  Mr.  Jeffs  is  the  Managing Director of the Whittier Trust
Company,  an investment management firm based in Pasadena, California.  Prior to
joining  the  Whittier  Trust  Company,  Mr.  Jeffs  created the private capital
management  division  at  Trust  Services  of  America (TSA) served as its Chief
Investment  Officer  and  President  of  TSA  Capital  Management.

Mr.  Jon Diamond. Mr. Diamond has served as the Chairman and Managing Partner of
J.  Diamond  Group,  L.P.,  a  media  entertainment  investment partnership from
January  1993  through  June 1995, and as Vice Chairman of N2K Inc., a media and
entertainment  company  from  June 1995 to March 1999.  Mr. Diamond is currently
the  Chairman  of CDNow, a media entertainment company and a successor by way of
merger  of  N2K  Inc.,  a  position  he  has  held  since  March  1999.

The  Board  of Directors met 19 times during 1999 for regular Board of Directors
meetings.  All  directors attended 100% of the aggregate of (i) the total number
of  meetings of the Board of Directors held while they were members and (ii) the
total  number  of  meetings  held by all Committees of the Board of Directors on
which  they  served  as members. In addition, on several occasions, the Board of
Directors  gave  their  unanimous  written  consent  on  issues involving normal
corporate  business.  The  Board of Directors has three standing committees, the
Audit  Committee,  the Compensation Committee, and the Long-Term Stock Incentive
Plan  Administration  Committee ("LTSIP Administration Committee"). During 1999,
the  Audit  Committee  and  the  LTSIP Administration Committee were composed of
Messrs.  Diamond  and  Jeffs . The Audit and LTSIP Administration Committees did
not  meet  during  1999, the functions of such committees being performed by the
Board of Directors as a whole. The LTSIP Administration Committee is responsible
for  overseeing  the  Company's  Long-Term  Stock  Incentive  Plan (the "LTSIP")
including,  subject  to  the  express  terms  of  the  LTSIP,  making  awards,
interpreting  the  LTSIP, amending and rescinding rules and other duties related
to  the  proper  implementation  of  the  LTSIP.  During  1999, the Compensation
Committee  was  composed of Messrs. Duncan and Irwin. The Compensation Committee
met once in 1999. The primary responsibility of the Compensation Committee is to
establish  and  review the compensation policies of the Company, including those
for  executives.  During  1999, the Company did not have a nominating committee,
the functions of such a committee being performed by the Board of Directors as a
whole.

                                       23
<PAGE>


In  1999,  the  LTSIP  provided  that  upon  assuming  office, each non-employee
director  would  be  granted  a  non-qualified option to acquire 5,000 shares of
Common  Stock at an exercise price equal to 100% of the fair market value on the
date of grant. One-half of the grant shall become exercisable upon completion of
one  year  of service as a director and the remaining balance upon completion of
two  years  of  service  as  a director. All options have a five-year expiration
term.

In  December 1999, the LTSIP was amended to grant 75,000 options at market price
at  the  time  of  grant  over  three  years  to  new  directors.

Directors  do  not  receive  compensation for attending meetings of the Board of
Directors.  Directors  are  reimbursed  for  their reasonable travel and lodging
expenses  incurred  attending  meetings.

SECTION  16(A)  BENEFICIAL  OWNERSHIP  REPORTING  COMPLIANCE

Pursuant  to  Section  16(a)  of  the Securities Exchange Act of 1934, executive
officers,  directors  and  10%  shareholders of the Company are required to file
reports  on Form 3, 4 and 5 of their beneficial holdings and transactions in the
Company  Common  Stock.  With  the exception of Form 3's required to be filed by
Messrs.  Vollero and Panzarella on becoming directors in October 1999 and a Form
4  filing  required  to have been made by Mr. Irwin in connection with a sale of
common  stock  in September 1999 pursuant to Rule 144 and a capital contribution
to  the  Company in October, 1999, during 1999, all such reports were filed in a
timely  manner.

ITEM  11.  EXECUTIVE  COMPENSATION

The  following table shows, for the years ended December 31, 1999, 1998 and 1997
the cash compensation paid by the Company, as well as certain other compensation
paid  or  accrued  for  the  year,  to  Company's  five  most highly compensated
executive  officers  (the  "Named  Individuals")  during  1999:

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>



<S>                    <C>           <C>       <C>       <C>         <C>              <C>                 <C>        <C>
                                                  Long Term Compensation
                                                    ----------------------
                                Annual Compensation                     Awards                   Payouts
                                                                Restricted   Securities                         All Other
Name and Position . .  Year        Salary     Bonus     Other   Stock Award  Underlying Options  LTSIP Payouts Compensation

R. Lindsey Duncan (2)   1999    $ 225,000  $ 50,000  $    0            0                   0  $            0           0
                        1998      192,219         0       0            0              50,000               0           0
                        1997      150,000         0       0            0             401,252               0           0

Klee Irwin (1). . . .   1999      259,808         0       0            0                   0               0           0
                        1998      455,000         0       0            0              50,000               0           0
                        1997            0         0       0            0                   0               0           0

Louis Mancini (3) . .   1999      284,615         0       0            0                   0               0           0

Rockwell Schutjer . .   1999       51,923         0       0            0                   0               0           0
                        1998      122,163         0       0            0                   0               0           0
                        1997       80,000         0       0            0                   0               0           0
                        1996       80,000         0       0            0             132,500               0           0
</TABLE>

                                       24
<PAGE>


(1)  Mr.  Irwin's  employment  ceased  on  April  20, 1999, and his options have
expired  unexercised.  Mr. Schutjer's employment with Omni Nutraceuticals ceased
on  July  15,  1999.  Mr.  Schutjer's  options  have  expired  unexercised.

(2)  Mr.  Duncan's  options  remain  exercisable  subject  to  the  terms of the
Withdrawal  Agreement.

(3)  Mr. Mancini's options were cancelled pursuant to the Termination Agreement.

OPTION  GRANTS

The  following  table presents information with respect to the Named Individuals
concerning  the  exercise of options during 1999 and unexercised options held as
of  December  31,  1999.

Individual  Grants
------------------

<TABLE>
<CAPTION>

<S>                   <C>            <C>            <C>            <C>            <C>            <C>      <C>       <C>
                                                                                                    Potential Realizable Value
                                                                                                    at Assumed Annual Rates of
                                                                                                    Stock Price Appreciation for
                                     % Total                                                        Option Term
            Number of Securities  Options/SARS
            Underlying Options     Granted to
            /SARS Granted         Employees in   Exercise    Stock Price on
                                   Fiscal Year     Price       Grant Date     Expiration Date      0%      5%       10%
R. Lindsey
Duncan         550,000               --           $2.00           $2.00          6/30/03            --      --       --

</TABLE>


OPTION  EXERCISES  AND  HOLDINGS

The  following  table presents information with respect to the Named Individuals
concerning  the  exercise of options during 1998 and unexercised options held as
of  February  15,  2000:


<TABLE>
<CAPTION>



<S>                <C>                       <C>                                <C>          <C>            <C>
                                                               Number of Unexercised
                                                               In-The-Money Options at     Value of Unexercised Options at
                                                               December 31, 1999 (1)       December 31, 1999
                                                               ------------------------    -----------------
Name. . . . . . .  Shares Exercised (#)   Value Realized ($)   Exercisable  Unexercisable  Exercisable  Unexercisable

R. Lindsey Duncan          0                  $   0            1,003,029        33,334        $0           $0
</TABLE>

(1)  Based  on  the  closing  market price of $1.125 per share for the Company's
Common  Stock  as  of  December  31,  1999.

                                       25
<PAGE>


COMPENSATION  COMMITTEE  INTERLOCKS  AND  INSIDER  PARTICIPATION

R.  Lindsey  Duncan,  and  Klee  Irwin,  the  Company's  current Chief Executive
Officer,  served  on the Compensation Committee of the Board of Directors during
1999.

EMPLOYMENT  AGREEMENTS

Upon  the  consummation  of  the Merger, both Mr. R. Lindsey Duncan and Mr. Klee
Irwin  entered  into substantially similar three-year employment agreements with
Omni  Nutraceuticals.  In 1999, Mr. Duncan was employed as Chairman of the Board
and  as a member of the Executive Committee with all duties and responsibilities
normally  associated  with  this  position.  Mr. Irwin was employed as the Chief
Executive Officer and as a member of the Executive Committee with all duties and
responsibilities normally associated with this position until April 20, 1999. On
that date, Mr. Irwin resigned, as Chief Executive Officer of Omni Nutraceuticals
and  his  employment  agreement  was  terminated  effective  April  20, 1999. In
connection  with  his  resignation the Board of Directors appointed him as Chief
Executive  Officer  of  HealthZone.com,  the  Company's  wholly owned e-commence
subsidiary  ("HealthZone").  In  October of 1998 (as revised in June 1999), Omni
Nutraceuticals  entered into an agreement to hire Mr. Louis Mancini as President
and  Chief  Operating  Officer  and,  subsequently,  Chief  Executive  Officer.

These  employment  agreements  provide for: (i) annual salaries of $225,000, and
$300,000  for  Messrs.  Duncan and Mancini, respectively; (ii) the right for Mr.
Duncan  to  receive  an  annual  bonus  equal to 2% of the consolidated earnings
before  income  taxes  in  excess of $6,000,000 and the right for Mr. Mancini to
receive  an  annual  bonus  of  2%  of  earnings  before depreciation, interest,
individual  taxes  and  amortization  above  six (6), eight (8), twelve (12) and
fourteen  (14)  million dollars for the years 1999-2002, respectively; and (iii)
the  right  to  participate  in  all  retirement  and  welfare, benefit, fringe,
perquisite  and  other  plans  and  programs  applicable  generally to other key
executives  in  effect  at  any time. In addition, all the above are entitled to
reimbursement  for  their  reasonable  business  expenses.

Under his terminated employment agreement Mr. Irwin received an annual salary of
$350,000  and  the right to the same annual bonus and to participate in the same
retirement and welfare, benefit, fringe, perquisite and other plans and programs
as  Mr.  Duncan.  All  of  the  Employment Agreements have been terminated.  See
"Item  13.  Certain  Relationships  and  Related  Transactions--Irwin Settlement
Agreement"  and  "Recent  Changes  in  Management"  below.



RECENT  CHANGES  IN  MANAGEMENT

Mr.  Duncan's  Withdrawal

Effective  on  March 12, 2000 (the "Effective Date"), Mr. R. Lindsay Duncan, the
former  Chairman  of  the Board of Omni, and his spouse, Cheryl Wheeler, entered
into  an  Agreement  dated  March 11, 2000 (the "Withdrawal Agreement") with the
Company,  pursuant  to  which  (i) Mr. Duncan agreed to resign from the Board of
Directors  of the Company (the "Board"), terminate his employment agreement with
the  Company (the "Employment Agreement") and cease all further involvement with
the  Company,  and  (ii)  Mr.  Duncan and Cheryl Wheeler both agreed to (A) vote
their  respective  shares  of  the  common  stock  of the Company (or give their
written consent) on all matters on the same proportionate basis as the remaining
shareholders of the Company vote their shares (or give their written consent) on
such matters for a period of five years from the Effective Date, and (B) appoint
Andrew  Vollero,  Jr.,  currently a director of the Company, as attorney-in-fact
for  each  of  them  to vote their shares of Common Stock (or give their written
consent)  as  aforesaid.

                                       26
<PAGE>


Mr.  Duncan's  agreement  to  resign from the Board and terminate the Employment
Agreement  was  conditioned  upon  the  occurrence of certain enumerated events,
circumstances  or  conditions, each of which occurred or was satisfied or waived
on  or  before  March  12,  2000,  including  the  following:

(i)     The  execution  and  delivery  by  the Company of an indemnity agreement
indemnifying  Mr.  Duncan  and related persons for losses in connection with his
services  to  the  Company  (the  "Indemnity  Agreement").

(ii)     In  settlement  of  the remaining obligations owed Mr. Duncan under the
Employment  Agreement, the extension of the exercise and expiration dates of all
of  his  existing stock options to purchase 1,003,029 shares of the Common Stock
to  the  seventh  anniversary  of  the  Effective  Date.

(iii)     The  receipt by Mr. Duncan of $1,500,000 in net proceeds from the sale
of  shares  of Common Stock owned by Mr. Duncan at a price of $3.00 per share in
one  or  more  transactions  which were not required to be aggregated with sales
made  by Mr. Duncan pursuant to Rule 144 promulgated under the Securities Act of
1993,  as  amended.

(iv)     The  execution  and  delivery  by  American  Equities LLC and Corporate
Financial  Enterprises,  Inc.  (collectively,  the  "Investors") of a term sheet
providing for the purchase by the Investors from the Company of 2,000,000 shares
of  5%  Convertible  Preferred  Stock,  Series  A and warrants to purchase up to
500,000  shares  of  Common Stock for an aggregate purchase price of $2,000,000.

(v)     The  execution  and delivery by each of the Investors to Mr. Duncan of a
General  Release.

(vi)     The  execution  and  delivery  by  the  Company  and  Mr.  Duncan  of a
Registration  Rights  Agreement  (the  "Registration  Rights  Agreement").

(vii)     The  termination  of the Voting Agreement dated October 8, 1999 by and
between  Mr.  Duncan  and  Klee  and  Margareth  Irwin.

(viii)     The  execution  and  delivery by each of Klee Irwin and Mr. Duncan of
mutual  General  Releases.

All  of  the  above  conditions were satisfied or waived and Mr. Duncan resigned
from the Board and terminated the Employment Agreement effective March 12, 2000.

Change  in  Management
----------------------

At a meeting of the Board held on March 12, 2000 (the "Board Meeting"), at which
the  Withdrawal Agreement and the ancillary agreements executed and delivered by
the  Company  in  connection  therewith were approved, ratified and adopted, the
Board  filled  the  vacancies  created  by  the  resignations  of  Mr.  Santo P.
Panzarella  as  a  Class  III  director  and  Mr. Jonathan Diamond as a Class II
director,  with  the  election  of  Messrs.  Christof Ballin and Albert Kashani,
respectively.  Upon  Mr. Duncan's resignation as a Class I director, the vacancy
created  thereby was filled with the appointment of Mr. Martin Sumichrast.  Each
of  these  individuals  was appointed to serve in such respective capacities for
the  remaining  balance of his respective term of office until his successor has
been  duly  elected  and  has  qualified.

At  the  Board  Meeting,  the Board terminated Mr. Louis Mancini's employment as
President  and  Chief  Executive  Officer  of the Company and Mr. Klee Irwin was
appointed  to  fill  the  vacancy  created  thereby.  The  Company  negotiated a
settlement  with  Mr. Mancini regarding the terms under which his employment has
been  terminated.  Pursuant  to  the  terms  of  the  settlement, Mr. Mancini is
entitled  to (i) payment of unpaid salary, vacation and sick pay in an amount of
$22,644.23;  (ii)  cancellation  of  all Mr. Mancini's stock options outstanding
other than 50,000 previously vested options at $2.50 per share provided they are
exercised  prior  to  December  31, 2000; (iii) forgiveness by the Company of an
outstanding  indebtedness  in  the original principal amount of $350,000 made to
Mr.  Mancini  by  the  Company;  (iv) waiver by Mr. Mancini of any and all other
compensation  and/or benefits by the Company or any of its subsidiaries; and (v)
mutual  releases  between Mr. Mancini and the Company, R. Lindsey Duncan and his
spouse,  Klee  Irwin  and  his  spouse  and  Andrew  Vollero,  Jr.

                                       27
<PAGE>


At  the Board Meeting, the Board also authorized the termination of that certain
Settlement Agreement dated October 8, 1999, by and among the Company and Mr. and
Mrs.  Klee  Irwin,  and  the  ancillary agreements executed and delivered by the
Company  in connection therewith. See Item 13 "Certain Relationships and Related
Transactions"

By  letter  dated  April  10, 2000, Mr. Martin Sumachrast resigned, for personal
reasons, as a director of the Company.  Mr. Sumachrast did not resign because of
any  disagreement  with  the  Company  on  any  matter relating to the Company's
operations,  policies  or practices or otherwise any other matter required to be
disclosed.

ITEM  12.  SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS  AND  MANAGEMENT

The  following  table  includes  information as of March 31, 2000 concerning the
beneficial  ownership of the holdings of Common Stock by (i) all persons who are
known  by  Omni  Nutraceuticals  to hold five percent or more of the outstanding
shares of Common Stock, (ii) each of the directors of Omni Nutraceuticals, (iii)
each  executive  officer  of  Omni  Nutraceuticals,  and  (iv) all directors and
executive  officers  of  Omni  Nutraceuticals  as  a  group. Except as otherwise
indicated,  all  shares  are  owned directly, and the persons named in the table
have  sole  voting  and  investing  power  with  respect  to  shares  shown  as
beneficially  owned  by  them.

<TABLE>
<CAPTION>
<BTB>
<S>    <C>                                       <C>                      <C>
 Name and Address of Beneficial Owner     Shares Beneficially Owned     Percent
 ------------------------------------     -------------------------     -------
PRINCIPAL  SHAREHOLDER
R.  Lindsey  Duncan
1750  Chastain  Pkwy,
Pacific Palisades, CA
90066 (1) (2) (3) (4)                             6,806,369               23.6%

Klee  and  Margareth  Irwin
7825 Veragua Drive,
Playa del Rey, CA 90293                          14,688,335               43.5%

DIRECTORS  AND  EXECUTIVE  OFFICERS
Klee  Irwin  (5)                                 See  Above
Louis  Mancini  (2)                                       0                0.0%
Christof  Ballin  (6)                                15,000                   *
Martin  Sumichrast  (7)                                   0                0.0%
Jonathan  Diamond                                    25,000                   *
Santos  Panzarella                                        0                   *
Andrew  Vollero  (3)                                 25,000                   *
Albert Kashani                                            0                   *

ALL DIRECTORS AND OFFICERS AS A GROUP            21,559,704               74.6%

</TABLE>

                                       28
<PAGE>


 *Less  than  1%

     (1)     Includes 405,439 shares of Common Stock owned by Cheryl Duncan, Mr.
Duncan's  wife.  Mr.  Duncan  disclaims  ownership  of  such  shares.

     (2)     Options  have  been  cancelled  pursuant  to Termination Agreement.

     (3)     Became a director of Omni Nutraceuticals effective October 8, 1999.
Includes  4,803,340 shares of common stock registered in the names of R. Lindsey
Duncan and Cheryl Wheeler over which Mr. Vollero exercises an irrevocable proxy.

     (4)     Served  as  an executive officer of Omni Nutraceuticals during 1999
and appears in the Summary Compensation Table. Resigned effective March 12, 2000

     (5)     Resigned  as  an officer of Omni Nutraceuticals effective April 20,
1999.  Became  Chief  Executive  Officer  of  the  Company  on  March  12, 2000.

     (6)     Became  a  director  on  March  12, 2000.

     (7)     Became  a  director  on  March 12, 2000 and resigned from the Board
April 10, 2000.

ITEM  13.  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS

In  June  and  October 1998, the Company entered into employment agreements with
the  former  Chairman  of the Board, current  Chief Executive Officer and former
Chief  Executive  Officer  and  President  (see  Note  10  of Notes to Financial
Statements).  All  such  employment  agreements  have  been  terminated.

On  October  8,  1999,  the Company and Mr. Klee Irwin entered into a settlement
agreement (the "Settlement Agreement') in order to resolve certain mutual claims
that had arisen between the Company and Mr. Irwin.  Among the principal terms of
the  settlement  were  the  following:

(a)     The  Company  agreed  to  provide Mr. Irwin with the following severance
benefits:  (a)  a  monthly payment in the same amount that he received under his
former employment agreement, for the period commencing October 1, 1999 until the
earlier  of  (i)  April  16,  2000 or (ii) the sale, merger, bankruptcy or other
transaction  involving  HealthZone which results in HealthZone being capitalized
at more than $1,700,000; (b) continued coverage for Mr. Irwin and members of his
immediate  family  under  the  Company's  health  insurance  plans,  and (c) the
continued  provision  of  an  automobile  until  November  22,  1999.

(b)     Mr. Irwin agreed to assume the defense of a claim asserted by the former
shareholders  of Health and Vitamin Express, Inc. ("HVE"), a company acquired by
HealthZone in February 1999, and in connection therewith agreed to indemnify the
Company  from  any liability associated therewith except that the Company agreed
to  issue up to 363,636 shares of common stock to the former HVE shareholders in
settlement  of  their  claim.

(c)     Mr.  Irwin  agreed  to reimburse the Company for any excess tax payments
made  on  his  and  his wife's behalf since October 17, 1997 attributable to all
periods  prior  to  the  merger  of  Irwin  Naturals with and into 4Health, Inc.

                                       29
<PAGE>


(d)     Mr.  Irwin  agreed to fund substantially all the net operating losses of
HealthZone  pending  its  spin-off  or  sale  by means of purchases of shares of
HealthZone  common  stock  at  a price per share based upon a base valuation (as
adjusted)  for  HealthZone  of  $3,500,000,  until at least $280,00 in aggregate
common stock purchases have been made, after which such price per share shall be
based upon the greater of such base valuation (as adjusted) or HealthZone's then
market  value.

(e)     Mr.  Irwin  agreed  that  he  would  guarantee  a  market  value for the
Company's  ownership interest in HealthZone of $2.3 million as of one year after
a  spin-off  of  HealthZone or October 8, 2001, and further agreed that he would
place  in  escrow  1,022,222  shares  of  his  common stock as security for such
guarantee  at such time as the Company first filed a registration statement with
the  Securities  and  Exchange  Commission  relating to the proposed spin-off of
HealthZone.

(f)     The  Company, HealthZone and Mr. Irwin entered into a Tax Allocation and
Indemnification Agreement pursuant to which the Company and HealthZone allocated
certain  tax  liabilities  and  attributes  between  themselves  and  HealthZone
indemnified  the  Company  for  any  liability  associated with the spin-off not
qualifying  as  a tax free transaction under Section 355 of the Internal Revenue
Code  of  1986,  as  amended,  with  Mr.  Irwin  guaranteeing  HealthZone's
indemnification  obligation  in  the  event  of  its  bankruptcy.

(g)     The  Company  and  Mr. Irwin issued mutual releases and indemnified each
other  against  certain claims.  As security for his indemnification obligations
Mr.  Irwin placed in escrow with Wells Fargo Bank 1,000,000 shares of his common
stock,  500,000  shares  of which would be released on December 31, 1999 (in the
absence  of  any  claims  for  indemnification  asserted by the Company) and the
balance  would  be  released on March 31, 2000 (in the absence of any claims for
indemnification  asserted  by  the  Company).

(h)     The Company granted Mr. Irwin a "call" option on the Company's shares of
HealthZone  for  the  greater  of  $2.3  million  or  HealthZone's  market value
commencing  March  31,  2000  if  the  spin-off  is not consummated before then.

(i)     Mr. Irwin granted the Company a "put" option on its shares of HealthZone
for  $2.3  million  commencing  June  1, 2000 if the spin-off is not consummated
before  then  or  the  Company's  shares of HealthZone are not sold for at least
$2,300,000.

(j)     The  Company  agreed  to bear the first $100,000 in expenses incurred by
the  Company  attributable  to  the  spin-off  and HealthZone agreed to bear all
documented  and  reasonable costs and expenses incurred by the Company in excess
of such $100,000 payment of such excess costs to be personally guaranteed by Mr.
Irwin.

On or about the date of the Settlement, Mr. Irwin made a capital contribution of
$410,000,  and returned 941,436 shares of Omni Nutraceutical common stock to the
Company.  The  Company  has  set  aside 363,363 of these shares to be issued, if
necessary,  to  the former owners of HVE, and the remainder will be reflected as
treasury  stock.

In  connection  with  the  settlement,  Mr. Irwin and Omni's chairman R. Lindsey
Duncan,  who  together own approximately 74% of the outstanding shares of voting
capital  stock  of Omni, each entered into a five-year voting agreement pursuant
to  which  Mr. Irwin has agreed to certain stand-still provisions and he and Mr.
Duncan  have  agreed  to  vote  their respective shares of Omni common stock for
their  respective  nominees  for  Class I and II directors and the candidate for
Class  III  director  nominated  by  the  two  Class  II  directors.

Effective  March 12, 2000, the Settlement Agreement and all ancillary agreements
thereto,  including  the Voting Agreement between Mr. Duncan and Mr. Irwin, were
terminated.

                                       30
<PAGE>


SUBSEQUENT  EVENTS

On  January  24, 2000, the Company completed an equity transaction with American
Equities,  LLC  and  Corporate  Financial  Enterprises,  Inc. (collectively, the
"Investors")  that  was  intended  to provide up to $5,100,000 of capital to the
Company  and its wholly owned Internet subsidiary HealthZone.com ("HealthZone").

Under  the  terms of the transaction, the Company issued 3,000,000 shares of its
newly created 5% Convertible Preferred Stock, Series A ("Preferred Shares ") and
seven  year  warrants to purchase up to an aggregate of 775,000 shares of common
stock  at  an  exercise price of $2.25 per share, subject to adjustment, with an
additional  1,500,000  shares  to be issued in July 2000, subject to the Company
meeting  certain  performance  criteria.  The  aggregate  purchase price for the
Preferred  Shares  and  warrants was $4,000,000 payable in two installments, the
first  in  the  amount of $2,000,000 and, subject to the satisfaction of certain
performance  targets, the second in the amount of $2,000,000.  Concurrently with
the  first  installment  payment, HealthZone issued 222,222 shares of its common
stock  (representing  approximately  10%  of HealthZone's issued and outstanding
shares of common stock) and a seven year warrant to purchase up to 37,000 shares
of  its  common  stock at an exercise price, subject to adjustment, equal to the
lesser  of  $1.00  or  70%  of the lowest price received by HealthZone on future
sales  of  its  capital  stock,  for a purchase price of $1,000,000. The Company
also  agreed  to  lend HealthZone $1,000,000 out of second installment proceeds.
The  Company  used  the  proceeds  from  the  sale  of  its securities to reduce
indebtedness  and  for  working  capital  purposes.  The  Preferred  Shares  are
convertible  into  an  aggregate  of  3,000,000  shares  of Company common stock
(assuming  issuance  of  the  full  amount  of  Preferred  Shares),  subject  to
adjustment.  The  Preferred  Shares  are  not  redeemable  but may be subject to
mandatory conversion under certain circumstances. The Preferred Shares will vote
together  with  the  common  stockholders on an as converted basis and will have
separate  class  voting  rights  to  elect  one  director and in connection with
certain  corporate  changes.  The  Preferred  Shares  will  carry  a liquidation
preference  of  $.60  per  share  and an annual dividend rate of $.05 per share,
payable  semi-annually.  The Company may elect to pay the dividend in additional
Preferred  Shares  at  a  rate  of  .05  share  of  Preferred  Stock.

In  connection  with  the  above  transaction,  the  Company has (i) amended its
Articles  of Incorporation to provide for the Preferred Shares, (ii) amended the
Settlement Agreement between the Company and Klee Irwin as it related to certain
funding  provisions  of  HealthZone,  and  (iii)  the  entered into two separate
consulting  agreements,  pursuant  to one of which the Company to issued 560,000
restricted  shares  of  its  Common  Stock.

On  March  24,  2000  all  of  the  outstanding  shares of Preferred Shares were
mandatorily  converted  into  2,016,438  shares  of  common  stock.

                                       31
<PAGE>


                                     PART IV
                                     -------

ITEM  14.  EXHIBITS,  FINANCIAL  STATEMENT  SCHEDULES,  AND  REPORTS ON FORM 8-K


(a)     (1)     Financial  Statements.  See  Index  to Financial Statements
               (and Financial Statement Schedules) at page 27 of this Form 10-K
        (2)     Financial  Data Schedule. All other schedules required by Form
                10-K Annual Report have been omitted because they were not
                applicable, were included  in  the  notes to the financial
                statements, or were not required under the instructions
                contained in  Regulation  S-X
        (3)     Exhibits.  See  Exhibit  Index  at  page 24 of this Form 10-K.

(b)     (1)     Form  8-K  dated  March 12, 2000 regarding the issuance of
                equity  securities to American Equities LLP and Corporate
                Financial Enterprises, Inc.
        (2)     Form  8-K  dated  April 14, 2000 regarding changes in
                management and other issues

EXHIBIT  INDEX

<TABLE>
<CAPTION>
<BTB>
<S> <C>        <C>                                      <C>                                              <C>
                SEC
 EXHIBIT     REFERENCE
  NUMBER      NUMBER                               TITLE OF DOCUMENT                                   LOCATION
- ----------  -----------  ----------------------------------------------------------------------  --------------------
</TABLE>
<TABLE>
<CAPTION>
<BTB>
<S><C>         <C>                          <C>                                                         <C>
 Item 2.                 Plan of Acquisition, Reorganization, Liquidation, or Succession

   2.01          2       Agreement and Plan of Merger dated April 10, 1996, by and between       Incorporated by
                         4health, Inc., and Surgical Technologies, Inc. as amended June 4, 1996  Reference (4)

   2.04          2       Amended and Restated Agreement and Plan of Merger dated December 24,    Incorporated by
                         1997, signed January 7, 1998, by and between 4Health, Inc. and Irwin    Reference (7)
                         Naturals as amended April 2, 1998.

   2.05          2       Agreement to Purchase Asset of Inholtra Naturals Limited                Incorporated by
                                                                                                 Reference (9)

   2.06          2       Agreement & Plan of Merger with Health Vitamin Express Inc. ("HVE")     Incorporated by
                                                                                                 Reference (9)

 Item 3.                 Articles of Incorporation and Bylaws

   3.01          3       Articles of Incorporation of Surgical Subsidiary, Inc., a Utah          Incorporated by
                         Corporation now known as Surgical Technologies, Inc. Irwin              Reference (5)
                         Naturals/4Health, Inc.

   3.02          3       Articles of Merger and related Plan of Merger                           Incorporated by
                                                                                                 Reference (5)

   3.03          3       Bylaws                                                                  Incorporated by
                                                                                                 Reference (5)

   3.04          3       Articles of Merger and related Plan of Merger                           Incorporated by
                                                                                                 Reference (4)

   3.05          3       Form of Articles of Merger and related Plan of Merger                   Incorporated by
                                                                                                 Reference (7)

   3.06          3       Bylaws - Change to By-Laws Eliminating Executive Committtee             Incorporated by
                         Approved by Shareholders in December 1999                               Reference (15)

   3.07          3       Form of Articles of Merger and related Plan of Merger                   Incorporated by
                         Amendment to Articles Changing Name and Authorizing the Series          Reference (14)
                         A Preferred Stock

 Item 4.                 Instruments Defining the Rights of Security Holders

   4.01          4       Form of Warrant Agreement between 4Health, Inc. and Zions First         Incorporated by
                         National Bank with related form of Warrant                              Reference (4)

   4.02          4       Form of Sale Restriction Agreement respecting shareholders of both      Incorporated by
                         Surgical Technologies, Inc., and 4Health, Inc.                          Reference (4)

   4.03          4       Form of Consent, Approval, and Irrevocable Proxy respecting certain     Incorporated by
                         Surgical stockholders with related schedule                             Reference (4)

   4.04          4       Form of Consent, Approval, and Irrevocable Proxy respecting certain     Incorporated by
                         4Health stockholders with related schedule                              Reference (4)

   4.05          4       Specimen Common Stock Certificate                                       Incorporated by
                                                                                                 Reference (4)

   4.06          4       Specimen Warrant Certificate                                            Incorporated by
                                                                                                 Reference (4)

   4.07          4       Warrant certificates between 4Health and Allen & Company Incorporated   Incorporated by
                         dated April 15, 1997                                                    Reference (6)

   4.08          4       Stock Purchase Agreement by and among Omni Nutraceuticals, Inc. and     Incorporated by
                         HealthZone.com, Inc. and American Equities, LLC and Corporate           Reference (14)
                         Financial Enterprises, Inc. dated as of January 24, 2000

   4.09          4       Registration Rights Agreement among Omni Nutraceuticals, Inc. and       Incorporated by
                         American Equities, LLC and Corporate Financial Enterprises, Inc.        Reference (14)
                         dated as of January 24, 2000

   4.10          4       Warrant Agreement among Omni Nutraceuticals, Inc. and American Equities Incorporated by
                         LLC and Corporate Financial Enterprises, Inc. dated as of January       Reference (14)
                         24, 2000.

   4.11          4       Warrant Agreement between HealthZone.com, Inc. and American Equities    Incorporated by
                         LLC and Corporate Financial Enterprises, Inc. dated as of January       Reference (14)
                         24, 2000

 Item 5.                 Other Items

   5.01          5       Summary of Revolving Line of Credit Agreement between 4Health and       Incorporated by
                         Norwest Business Credit, Inc.                                           Reference (1)

   5.02          5       Summary of Revolving Line of Credit Agreement between 4Health and       Incorporated by
                         Wells Fargo Bank.                                                       Reference (9)
</TABLE>
                                       32
<PAGE>
<TABLE>
<CAPTION>
                SEC
 EXHIBIT     REFERENCE
  NUMBER      NUMBER                               TITLE OF DOCUMENT                                   LOCATION
- ----------  -----------  ----------------------------------------------------------------------  --------------------
 Item 10.                Material Contracts
<C>         <C>          <S>                                                                     <C>

  10.01         10       1996 Long-Term Stock Incentive Plan                                     Incorporated by
                                                                                                 Reference (4)

  10.02         10       Form of Option granted to Rockwell D. Schutjer                          Incorporated by
                                                                                                 Reference (4)

  10.03         10       Form of Proprietary Information, Inventions, and Non-Competition        Incorporated by
                         Agreement between 4Health and R. Lindsey Duncan                         Reference (4)

  10.04         10       Form of Employment Agreement between the Surviving Corporation and      Incorporated by
                         Rockwell Schutjer                                                       Reference (4)

  10.05         10       Deed of Trust Note and related Deed of Trust, Assignment of Rents,      Incorporated by
                         Security Agreement, and Fixture Filing, dated February 20, 1997, in     Reference (3)
                         the principal amount of $1,350,000 due Standard Insurance Company

  10.06         10       Form of Non-Negotiable Promissory Note                                  Incorporated by
                                                                                                 Reference (7)

  10.07         10       Promissory Note to issued into Inholtra Naturals Limited                Incorporated by
                                                                                                 Reference (9)

  10.08         10       Consulting Agreement with Michael Driver                                Incorporated by
                                                                                                 Reference (9)

  10.09         10       Employment Agreement with Louis Mancini, Lindsey Duncan & Klee Irwin    Incorporated by
                                                                                                 Reference (9)

  10.10         10       Letter of Intent with Klee Irwin dated April 16, 1999                   Incorporated by
                                                                                                 Reference (10)

  10.11         10       Indemnity Agreement with Klee Irwin dated April 19, 1999                Incorporated by
                                                                                                 Reference (10)

  10.12         10       Secured Credit Agreement by and among Irwin Naturals/4 Health, Inc      Incorporated by
                         as Borrower, and First Source Financial LLP, as Agent and Lender        Reference (11)
                         dated as of June 10, 1999.

  10.13         10       Settlement Agreement dated October 8, 1999 between Omni                 Incorporated by
                         Omni Nutraceuticals, Inc. and Klee Irwin                                Reference (12)

  10.14         10       Tax Indemnification and Allocation Agreement dated October 8, 1999      Incorporated by
                         between Omni Nutraceuticals, Inc. and Klee Irwin                        Reference (12)

  10.15         10       Voting Agreement dated October 8, 1999 by and among Klee Irwin          Incorporated by
                         and Margareth Irwin and R. Lindsey Duncan.                              Reference (12)

  10.16         10       Escrow Agreement dated October 8, 1999 by and among Klee Irwin          Incorporated by
                         Wells Fargo Bank as the Escrow Agent and Omni Nutraceuticals            Reference (12)

  10.17         10       Amendment No. 1 to Settlement Agreement dated October 8, 1999           Incorporated by
                         between Omni Nutraceuticals, Inc. and Klee Irwin                        Reference (14)

  10.18         10       Consulting Agreement by and between Omni Nutraceuticals, Inc            Incorporated by
                         and Corporate Financial Enteprises, Inc. dated as of January 24, 2000   Reference (14)

  10.19         10       Consulting Agreement by and between Omni Nutraceuticals, Inc. and       Incorporated by
                         Monfort Investments dated as of January 24, 2000                        Reference (14)

  10.20         10       Lock up Agreement by Klee Irwin and B. Lindsey Duncan                   Incorporated by
                                                                                                 Reference (14)

  10.21         10       Indemnity Agreement between Omni Nutraceuticals, Inc. and Reid          Incorporated by
                         Breitman                                                                Reference (14)

  10.22                   Agreement  dated  March  11,  2000  among the Company,                 Incorporated by
                          R. Lindsay Duncan  and  Cheryl  Wheeler                                Reference (15)

  10.23                   Indemnity Agreement dated March 11, 2000, between the                  Incorporated by
                          Company and R.  Lindsay  Duncan                                        Reference (15)

  10.24                   Term  Sheet dated March 11, 2000 between the Company                   Incorporated by
                          and American Equities  LLC                                             Reference (15)

  10.25                   Registration  Rights  Agreement dated  March  11, 2000                 Incorporated by
                          among the Company,  R.  Lindsay  Duncan  and  Cheryl                   Reference (15)
                          Wheeler

  10.26                   Consulting  Agreement between the Company and Liviakis                 Incorporated by
                          Financial Communications,  Inc.                                        Reference (15)

  10.27                   Termination Agreement between the Company and Louis                    Incorporated by
                          Mancini                                                                Reference (15)


 Item 20.                Other Documents or Statements to Security Holders

  20.01         20       Notice of change of transfer and warrant agent.                         Incorporated by
                                                                                                 Reference (2)

 Item 23.

    23          23       Consent of Independent Public Accountant                                This filing

 Item 27.                Financial Data Schedule

  27.01         27       Financial Data Schedule                                                 This filing

</TABLE>

                                       33
<PAGE>


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

(1) Incorporated by reference from 4Health's report on Form 10-Q for the quarter
    ended September 30, 1997.

(2) Incorporated by reference from 4Health's report on Form 10-Q for the quarter
    ended March 31, 1997.

(3) Incorporated by reference from 4Health's report on Form 10-K for the year
    ended December 31, 1996.

(4) Incorporate by reference from Surgical's registration statement on Form S-4
    filed with the Commission, SEC file number 33-03243.

(5) Incorporated by reference from Surgical's report on Form 10-K for the year
    ended March 31, 1994.

(6) Incorporated by reference from Schedule 13D filed with the Commission by
    Allen & Company Incorporated on April 18, 1997.

(7) Proxy Statement of 4Health, Inc. dated June, 1998.

(8) Incorporated by reference from Irwin Naturals/4/Health Annual Report on Form
    10-K for the year ended December 31, 1998.

(9) Incorporated by reference from the Company's report on Form 10-K for the
    year ended December 31, 1998.

(10) Incorporated by reference from the Company's report on Form 8-K filed on
     June 7, 1999.

(11) Incorporated by reference from the Company's report on Form 8-K filed on
     July 22, 1999.

(12) Incorporated by reference from the Company's report on Form 8-K filed on
     October 28, 1999.

(13) Incorporated by reference from the Company's proxy statement filed on
     December 10, 1999

(14) Incorporated by reference from the Company's report on Form 8-K filed on
     January 31, 2000.

(15) Incorporated by reference from the Company's report on Form 8-K filed on
     April 14, 2000.

                                       34
<PAGE>


ITEM  1.                      FINANCIAL  STATEMENTS

                          INDEX TO FINANCIAL STATEMENTS




                                         PAGE

Report  of  Independent  Public  Accountants                          F-2
Balance  Sheets  as  of  December  31,  1999  and  1998               F-3
Statements  of  Operations  for  each  of  the  three
   years in the period ended December 31, 1999                        F-4
Statements  of  Shareholders'  Equity  for  each  of  the
   three  years  in  the period ended December 31, 1999               F-5

Statements  of  Cash  Flows  for  each  of  the  three years
   in the period ended December  31,  1999                            F-6
Notes  to  Financial  Statements                                      F-7





                                      F-1
<PAGE>
                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS



To  Omni  Nutraceuticals,  Inc.:

We  have  audited  the  accompanying  consolidated  balance  sheets  of  Omni
Nutraceuticals,  Inc.  (a  Utah  corporation) and Subsidiary (the Company) as of
December  31,  1999  and  1998,  and  the  related  consolidated  statements  of
operations,  shareholders'  equity and cash flows for each of the three years in
the  period  ended  December  31,  1999.  These  financial  statements  are  the
responsibility  of the Company's management. Our responsibility is to express an
opinion  on  these  financial  statements  based  on  our  audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to  obtain  reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the  amounts  and  disclosures in the 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 financial statements referred to above present fairly, in
all  material  respects, the financial position of Omni Nutraceuticals, Inc. and
Subsidiary as of December 31, 1999 and 1998, and the results of their operations
and  their  cash  flows for each of the three years in the period ended December
31,  1999  in  conformity  with  accounting principles generally accepted in the
United  States.

The  accompanying  financial  statements  have  been  prepared assuming that the
Company  will  continue  as  a  going  concern.  As  discussed  in Note 1 to the
financial statements, for the year ended December 31, 1999, the Company incurred
a  loss from operations of $8,306,000, and at December 31, 1999, the Company had
a  working  capital  deficit of $6,364,000 and a retained deficit of $17,554,000
which  raise substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are also described in Note 1.  The
financial  statements  do not include any adjustments that might result from the
outcome  of  this  uncertainty.



   /s/  ARTHUR  ANDERSEN  LLP


Los  Angeles,  California
April  12,  2000


                                      F-2
<PAGE>
                            OMNI NUTRACEUTICALS, INC.
                           CONSOLIDATED BALANCE SHEETS


<TABLE>
<CAPTION>



<S>                                                                <C>           <C>

                                                                   DECEMBER 31   DECEMBER 31
                                                                           1999          1998
                                                                   ------------  ------------

ASSETS

CURRENT ASSETS:
Cash                                                               $          -  $    426,000
Accounts receivable, net of reserves and allowances
   of $3,163,000 in 1999 and $1,131,000 in 1998                       6,776,000     6,023,000
Inventories                                                           5,972,000     2,855,000
Prepaid expenses and other                                              539,000       290,000
Current portion of receivables from officers and shareholder                  -       497,000
Current portion of notes receivable                                      11,000        99,000
                                                                   ------------  ------------

      TOTAL CURRENT ASSETS                                           13,298,000    10,190,000

Building held for sale                                                        -     1,521,000
Property and equipment, net                                           1,516,000       627,000
Trademarks, net of accumulated amortization of
    $726,000 in 1999 and $13,000 in 1998                             12,798,000        99,000
Goodwill, net of accumulated amortization of $484,000 in 1999         2,422,000             -
Intangibles, net of accumulated amortization of $307,000 in 1998              -       420,000
Finance fees, net of accumulated amortization of $110,000 in 1999       934,000             -
Other assets                                                            320,000        55,000
Receivables from officers and shareholder, net of current portion             -       175,000
Notes receivable, net of current portion                                439,000             -
                                                                   ------------  ------------

                                                                   $ 31,727,000  $ 13,087,000
                                                                   ============  ============
</TABLE>

                      LIABILITIES AND SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>



<S>                                                            <C>            <C>

CURRENT LIABILITIES:
Cash overdraft                                                 $    165,000   $         -
Accounts payable                                                  7,176,000     2,637,000
Accrued liabilities                                               2,875,000       942,000
Line of credit                                                    6,436,000     1,000,000
Current portion of term loan                                      2,332,000             -
Current portion of notes payable                                    176,000       328,000
Income taxes payable                                                 52,000       438,000
Customer deposits                                                   450,000       450,000
                                                               -------------  ------------

      TOTAL CURRENT LIABILITIES                                  19,662,000     5,795,000
                                                               -------------  ------------

Term loan, net of current portion                                10,085,000             -
Notes payable, net of current portion                               102,000     1,423,000

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY:
Shares issuable under legal settlement                            1,200,000             -
Preferred stock; $1 par value; 5,000,000 shares authorized;
    Issued and outstanding, none                                          -             -
Common stock, $.01 par value; 50,000,000 shares authorized;
    Issued  -  27,352,009 in 1999 and 27,857,139 in 1998;
    Outstanding  -  27,261,119 in 1999 and 27,766,249 in 1998       274,000       279,000
Additional paid-in capital                                       18,008,000    14,333,000
Treasury stock, 90,890 shares at cost                               (50,000)      (50,000)
Retained deficit                                                (17,554,000)   (8,693,000)
                                                               -------------  ------------

                                                                  1,878,000     5,869,000
                                                               -------------  ------------

                                                               $ 31,727,000   $13,087,000
                                                               =============  ============
</TABLE>

    THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL
    STATEMENTS.
                                      F-3
<PAGE>

                            OMNI NUTRACEUTICALS, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS


<TABLE>
<CAPTION>



<S>                                                 <C>                         <C>           <C>
                                                                  YEAR  ENDED DECEMBER 31,
                                                                  --------------------------

                                                                         1999          1998          1997
                                                    --------------------------  ------------  ------------

Net Sales                                           $              35,308,000   $30,547,000   $29,353,000
Cost of Sales                                                      17,847,000    12,540,000    13,303,000
                                                    --------------------------  ------------  ------------

           Gross profit                                            17,461,000    18,007,000    16,050,000
                                                    --------------------------  ------------  ------------

Costs and Expenses:
   Selling, general and administrative                             23,927,000    16,180,000    17,486,000
   Loss on write-off of intangibles                                   640,000             -             -
   Loss on write-off of goodwill                                            -             -     3,202,000
   Legal settlement                                                 1,200,000             -             -
                                                    --------------------------  ------------  ------------

                                                                   25,767,000    16,180,000    20,688,000
                                                    --------------------------  ------------  ------------

          Income (loss) from operations                            (8,306,000)    1,827,000    (4,638,000)
                                                    --------------------------  ------------  ------------

Other Income (Expense):
   Interest income                                                     32,000        10,000        52,000
   Interest expense                                                (1,339,000)     (163,000)     (167,000)
   Other                                                              478,000       (56,000)       36,000
                                                    --------------------------  ------------  ------------

                                                                     (829,000)     (209,000)      (79,000)
                                                    --------------------------  ------------  ------------

          Income (loss) before provision (benefit)
             for income taxes                                      (9,135,000)    1,618,000    (4,717,000)
Provision (benefit) for income taxes                                 (274,000)      600,000             -
                                                    --------------------------  ------------  ------------

Net income (loss)                                   $              (8,861,000)  $ 1,018,000   $(4,717,000)
                                                    ==========================  ============  ============

Income (loss) before provision for income taxes                                   1,618,000    (4,717,000)

Pro forma provision for income taxes (unaudited)                          N/A     1,345,000       765,000
                                                                                ------------  ------------

Pro form net income (loss) (unaudited)                                    N/A   $   273,000   $(5,482,000)
                                                                                ============  ============

Earnings (loss) per common share:
   Basic - historical                               $                   (0.31)  $      0.04   $     (0.17)
   Diluted - historical                             $                   (0.31)  $      0.04   $     (0.17)
   Basic - pro forma                                                      N/A   $      0.01   $     (0.20)
   Diluted - pro forma                                                    N/A   $      0.01   $     (0.20)

Weighted Average Shares Outstanding
   Basic - historical                                              28,177,000    27,747,000    27,365,000
   Diluted - historical                                            28,177,000    28,221,000    27,365,000
   Basic - pro forma                                                      N/A    27,747,000    27,365,000
   Diluted - pro forma                                                    N/A    28,221,000    27,365,000
</TABLE>

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

                                      F-4
<PAGE>

                            OMNI NUTRACEUTICALS, INC.
                       STATEMENTS OF SHAREHOLDERS' EQUITY
        FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED DECEMBER 31, 1999


<TABLE>
<CAPTION>




                               SHARES                                ADDITIONAL
                            ISSUABLE UNDER        COMMON STOCK        PAID IN         TREASURY STOCK      REATINED
                                                  ------------                        --------------
                            LEGAL SETTLEMENT     SHARES     AMOUNT     CAPITAL       SHARES     AMOUNT     DEFICIT       TOTAL
                            ----------------     ------     ------     -------       ------     ------     -------       -----


<S>                          <C>             <C>          <C>        <C>           <C>       <C>           <C>            <C>
 BALANCE, December 31, 1996 $        -       27,210,374   $272,000   $11,235,000   90,890    $   (50,000) $(1,201,000) $10,256,000

 Issuance of common stock
  in connection with exercise
   stock options                     -          108,424      1,000       151,000      -            -              -        152,000

   Compensation expense
    incurred in connection
    with warrants issued for
    investment banking services      -             -          -          275,000      -            -              -        275,000

   Distributions                     -             -          -             -         -            -          (579,000)   (579,000)

   Issuance of common stock to
    old 4Health Shareholders
   pursuant to a realignment
   of equity interests               -          500,000      5,000        (5,000)     -            -              -            -

   Net loss                          -             -          -             -         -            -        (4,717,000) (4,717,000)
                             ------------------------------------------------------------------------------------------------------

BALANCE, DECEMBER 31, 1997           -       27,818,798    278,000    11,656,000   90,890      (50,000)     (6,497,000)  5,387,000

 Issuance of common stock in
  connection with exercise
  of stock options                   -           38,341      1,000       172,000     -            -              -         173,000

Compensation expense incurred
 in connection with issuance
  of stock options                   -             -          -            6,000     -            -              -           6,000

Compensation expense incurred in
 connection with warrants issued
  for investment banking services    -             -          -          388,000     -            -              -         388,000

Distributions                        -             -          -             -        -            -         (1,103,000) (1,103,000)

Effect of Irwin Naturals
 termination of its "S"
  Corporation election               -             -          -        2,111,000     -            -         (2,111,000)        -

   Net income                        -             -          -             -        -            -          1,018,000   1,018,000
                              ----------------------------------------------------------------------------------------------------

BALANCE, DECEMBER 31, 1998           -       27,857,139    279,000    14,333,000   90,890      (50,000)    (8,693,000)   5,869,000

Issuance of common stock in
 connection with HVE acquisition     -          363,636      4,000     2,269,000     -            -              -       2,273,000

Issuance of common stock in
 connection with exercise
  of stock options                   -           19,670          -        85,000     -            -              -          85,000

Issuance of common stock for
  services                           -           53,000      1,000       174,000     -            -              -         175,000

Compensation expense incurred in
 connection with issuance of
  warrants and options for
   services                          -             -          -          832,000     -            -              -         832,000

363,636 shares issuable under
 under legal settlement (see
  Note 12)                       1,200,000         -          -             -        -            -              -       1,200,000

 Capital contribution
  and return of shares
   (see Note 13)                     -         (941,436)   (10,000)      315,000     -            -              -         305,000

   Net loss                          -             -          -             -        -            -     (8,861,000)     (8,861,000)
                              -----------------------------------------------------------------------------------------------------

BALANCE, DECEMBER 31, 1999      $1,200,000   27,352,009   $274,000   $18,008,000   90,890  $  (50,000)$(17,554,000)     $1,878,000
                             =============   ==========   ========   ===========   ======  =========== ============    ===========
</TABLE>

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

                                      F-5
<PAGE>

                            OMNI NUTRACEUTICALS, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>



<S>                                                                    <C>                        <C>           <C>
                                                                       YEAR ENDED DECEMBER 31,
                                                                       -------------------------
                                                                                           1999          1998          1997
                                                                       -------------------------  ------------  ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                                                      $             (8,861,000)  $ 1,018,000   $(4,717,000)
Adjustments to reconcile net income
 (loss) to net cash provided by
 (used in) operating activities;
  Depreciation and amortization                                                       1,892,000       550,000       557,000
  Provision for returns, allowances and doubtful accounts                             3,153,000     2,116,000     2,549,000
  (Gain) loss on disposition of building, property and equipment                       (478,000)       10,000        99,000
  Loss on write-off of intangibles                                                      640,000             -             -
  Loss on write-off of goodwill                                                               -             -     3,202,000
  Legal settlement                                                                    1,200,000             -             -
  Issuance of warrants and options as compensation for services                         832,000       394,000       275,000
  Issuance for common stock for services                                                175,000             -             -
  Write-off of notes receivable                                                         389,000             -             -
  (Increase) Decrease in;
    Accounts receivable                                                              (3,906,000)   (3,239,000)   (3,559,000)
    Inventory                                                                        (3,367,000)     (693,000)      850,000
    Prepaid and other                                                                  (405,000)      119,000      (122,000)
   Increase (Decrease) in:
    Bank overdraft                                                                      165,000             -             -
    Accounts payable                                                                  4,539,000       583,000       132,000
    Accrued liabilities                                                               1,933,000      (375,000)       68,000
    Income taxes payable                                                               (386,000)      377,000      (682,000)
    Deferred income taxes                                                                     -       184,000       125,000
                                                                       -------------------------  ------------  ------------

          Net cash provided by (used in) operating activities                        (2,485,000)    1,044,000    (1,223,000)
                                                                       -------------------------  ------------  ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchases of property and equipment                                                 (1,396,000)     (350,000)     (216,000)
 Net proceeds from disposition of building, property and equipment                      494,000             -         1,000
 Net cash paid for purchase of Inholtra and HVE                                     (13,493,000)            -             -
 Collection of note receivable                                                           68,000        14,000       269,000
 Other assets                                                                          (265,000)            -             -
 Receivables from Officers and Shareholders                                             322,000      (672,000)       96,000
                                                                       -------------------------  ------------  ------------

         Net cash used in investing activities                                      (14,270,000)   (1,008,000)      150,000
                                                                       -------------------------  ------------  ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of options                                                        85,000       173,000       152,000
Net borrowings under line of credit                                                   5,436,000       259,000       741,000
Borrowings under Term Loan                                                           13,000,000             -             -
Payments under Term Loan                                                               (583,000)            -             -
Borrowings under notes payable                                                       10,000,000       592,000     1,350,000
Repayments of notes payable                                                         (10,870,000)     (168,000)   (1,322,000)
Costs incurred with financing                                                        (1,044,000)            -             -
Capital contribution from shareholder                                                   305,000             -             -
Distributions to shareholders                                                                 -    (1,103,000)     (579,000)
                                                                       -------------------------  ------------  ------------

          Net cash provided by (used in) financing activities                        16,329,000      (247,000)      342,000
                                                                       -------------------------  ------------  ------------

Net decrease in cash                                                                   (426,000)     (211,000)     (731,000)

Cash at beginning of year                                                               426,000       637,000     1,368,000
                                                                       -------------------------  ------------  ------------

Cash at end of year                                                    $                      -   $   426,000   $   637,000
                                                                       =========================  ============  ============


SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the year for:
 Interest                                                              $              1,326,000   $   148,000   $   133,000
 Income Taxes                                                          $                 40,000   $    24,000   $   291,000

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
</TABLE>


During  1999,  in connection with the sale of the Company's facility in Boulder,
Colorado,  (i)  a  note  receivable  of  $450,000
was  received  from  the  buyer, and (ii) $1,300,000 of debt was assumed by the
buyer.

During  1999,  in  connection with the acquisition of Health and Vitamin Express
Inc.,  the  Company  (i)  issued  363,636  shares
of  the  Company's common stock valued at $2,273,000, and (ii) assumed $571,000
of  debt.

During 1999, the Company acquired property and equipment totaling $126,000 under
capital  lease  obligations.


THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE CONSOLIDATED FINANCIAL
STATEMENTS.

                                      F-6
<PAGE>

                            OMNI NUTRACEUTICALS, INC.

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 1999


1.     BUSINESSES  AND  LIQUIDITY/GOING  CONCERN

BUSINESS  AND  ORGANIZATION

     Omni  Nutraceuticals,  Inc.  (the  "Company"  "Omni")  is  a formulator and
supplier  of branded natural health, herbal and nutritional supplement products.
The  Company's  products are sold through mass retail, specialty natural health,
nutrition  and  food  retail  stores,  and  via  the  Internet.

     Omni  is  a  Utah  corporation,  and  was formerly known as Irwin Naturals/
4Health  Inc,  which  was formerly known as 4Health, Inc.  Omni is the surviving
corporation  of  a  merger  (the  "Merger") of 4Health, Inc., a Utah corporation
("4Health")  with  Irwin  Naturals,  Inc.,  a  California  corporation  ("IN")
consummated  June  30,  1998. Pursuant to the Merger that was accounted for as a
pooling  of  interests,  4Health  issued  15,750,000  shares  of common stock in
exchange  for  all  the  outstanding  shares of Irwin Naturals. The accompanying
financial  statements  for  1998  and  1997  have  been  restated to include the
financial position and results of operations for both companies as if the Merger
was  consummated  at the beginning of all periods presented. In August 1999, the
Company  changed  its  name  to Omni Nutraceuticals, Inc. On March 21, 2000, the
Company  announced  it  intended  to  change  its  name  to  HealthZone.com.

     Net  sales  and  net  income (loss) of the combining companies for 1998 and
1997  are as follows (individual line items, other than the totals, for the year
ended  December  31,  1998  are  unaudited):

<TABLE>
<CAPTION>



<S>                                          <C>             <C>
                                        December 31,    December 31,
                                                 1998            1997
                                        --------------  --------------
Net Sales
  4Health (pre-merger) . . . . . . . .  $   6,373,000   $  12,432,000
  Irwin Naturals (pre-merger). . . . .      9,291,000      16,921,000
  Irwin Naturals/4Health (post-merger)     14,883,000               -
                                        --------------  --------------
  Total. . . . . . . . . . . . . . . .  $  30,547,000   $  29,353,000
                                        ==============  ==============
Net Income (Loss):
  4Health (pre-merger) . . . . . . . .  $    (900,000)  $  (6,629,000)
  Irwin Naturals (pre-merger). . . . .      1,070,000       1,912,000
  Irwin Naturals/4Health (post-merger)        848,000               -
                                        --------------  --------------
  Total. . . . . . . . . . . . . . . .  $   1,018,000   $  (4,717,000)
                                        ==============  ==============
</TABLE>

LIQUIDITY/GOING  CONCERN

     The  Company  has  incurred losses from operations in two of the last three
years.  For  the  year ended December 31, 1999, the Company incurred a loss from
operations  of  $8,306,000,  and at December 31, 1999, the Company had a working
capital  deficit  of $6,364,000 and a retained deficit of $17,554,000 that raise
substantial  doubt  about  its  ability  to  continue  as  a  going concern.  In
addition,  the  Company  used cash in operations of $2,485,000 and used cash for
investing  activities,  primarily acquisitions, of $14,270,000.  The Company had
net  cash  outflows  in  each  of  the  last  three years.  Due to the Company's
operating  losses,  a large portion of the trade accounts payable is past due at
December  31, 1999. The Company had a cash overdraft of $165,000 at December 31,
1999.  Further,  availability under the Company's line of credit is limited.  At
December  31,  1999,  the Company had $6,436,000 outstanding out of a maximum of
$7,000,000  under  the  facility.

     Management's  plans  in  regard  to  these  items  include  the  following:

-     The Company raised $3,000,000 via a private placement in January 2000 (see
Note  16)
-     The  Company  raised $2,100,000 via a private placement in March 2000 (see
Note  16)
-     The  Company has a commitment from the January 2000 investor to provide an
additional  $2,000,000  in  private  placement funding contingent on the Company
achieving  certain sales benchmarks for the first two quarters of 2000 (see Note
16)
-     The  Company  is  currently negotiating to raise an additional $15 million
via  a  private placement with a plan to pay off the Term Loan with the proceeds
-     The  Company  has  received  a  waiver from its credit facility lender for
violations  of  certain  covenants  included  in the loan agreement (see Note 8)
-     The Company has reduced portions of its fixed overhead expenses, including
executive  salary  reductions  of  $1,300,000
-     Management  has  revised  its  marketing  strategy  and  plans  to  reduce
advertising  expenditures
-     Management  intends  to  focus  additional  efforts  toward developing its
e-commerce  operations  to  generate  additional  revenues

     There  are  no assurances that the capital already raised by the Company in
conjunction with the expense reductions will be sufficient to fund the Company's
operations  through 2000.  In addition, there are no assurances that the Company
will be able to successfully achieve the sales benchmarks necessary to raise the
additional  $2,000,000  or successfully raise other additional private placement
funds.  Further,  there  is  no  assurance  that  management  will  be  able  to
successfully  enter  the  e-commerce marketplace.  The failure of the Company to
successfully  achieve  one or all of the above items will have a material impact
on  the Company's financial position and results of operations. The accompanying
financial  statements  do not include any adjustments that might result from the
outcome  of  this  uncertainty.

2.     SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES

PRINCIPLES  OF  CONSOLIDATION

     The  accompanying consolidated financial statements include the accounts of
Omni  Nutraceuticals,  Inc.  and  its  wholly  owned  subsidiary, HealthZone.com
("HealthZone"). All significant intercompany accounts and transactions have been
eliminated.  Subsequent  to  December  31,  1999,  the  Company  entered  into a
transaction  where  222,222  shares,  which  represents approximately 10% of the
outstanding shares of its HealthZone subsidiary, were issued to a third party as
part  of  a  financing  transaction  (see  Note  16).

REVENUE  RECOGNITION

     The  Company  recognizes  revenue  at the time of shipment.  Provisions for
returns  and  allowances  are recorded as products are shipped. During the years
ended  1997,  1998  and  1999,  the Company provided $2,549,000, $2,116,000, and
$3,153,000,  respectively,  for returns and allowances, including allowances for
doubtful accounts, and incurred related write-offs of $2,288,000, $1,426,000 and
$1,121,000,  respectively.

STRAIGHT-LINE  RENT

     Certain  of  the  Company's  operating  leases include scheduled increasing
monthly  payments.  In  accordance with accounting principles generally accepted
in  the  United  States,  the  Company  has  accounted for the leases to provide
straight-line  charges  to  operations  over  the  lives  of  the  leases.

INVENTORIES

     Inventories  are  valued  at  the  lower of cost, determined on a first-in,
first-out  basis,  or  market.  Inventories  at  December  31, 1999 and 1998 are
summarized  as  follows:

<TABLE>
<CAPTION>



<S>                <C>         <C>
                      1999        1998
                ----------  ----------

Raw Materials.  $2,135,000  $  803,000
Finished Goods   3,837,000   2,052,000
                ----------  ----------

                $5,972,000  $2,855,000
                ==========  ==========

</TABLE>


PROPERTY  AND  EQUIPMENT

     Property  and  equipment  are stated at cost. Depreciation and amortization
are  provided  using the straight-line method over the estimated useful lives of
the  assets, which range from three to ten years.  Depreciation and amortization
expenses  are  included  in  selling, general and administrative expenses in the
accompanying  statements  of  operations.

     When  an  asset  is  sold  or  otherwise  disposed of, the cost and related
accumulated depreciation are removed from the accounts and any resulting gain or
loss are included in results of operations.  Repairs and maintenance are charged
to  expense  as  incurred and major replacements or betterments are capitalized.

LONG-LIVED  ASSETS

     The Company follows Financial Accounting Standards Board Statement No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be  Disposed  of," which required impairment losses to be recorded on long-lived
assets  used  in  operation  when  indicators  of  impairment  are  present.

GOODWILL

     Goodwill  is recorded at cost and is being amortized on straight-line basis
over  five years.  The recoverability of goodwill is assessed periodically based
on management estimates of undiscounted future operating income or from sales of
equity  from  the  acquired  business  to  which  the  goodwill  relates.

FINANCING  FEES

     Financing  fees  incurred  with  the  acquisition of the Company's existing
credit  facility have been deferred and are being amortized over the life of the
debt.


                                      F-7
<PAGE>
PATENTS  AND  TRADEMARKS

     Costs associated with the establishment and defense of trademarks have been
capitalized  and  are being amortized over periods of fifteen to seventeen years
using  the  straight-line  method.

ADVERTISING

     The  Company  expenses  advertising costs as incurred.  These costs include
promotional literature, direct mailing brochures, telemarketing and trade shows.
Costs incurred relating to the production of television commercials are deferred
until  the  commercial  has aired.  The Company incurred $3,191,000, $1,920,000,
and  $3,114,000  for  advertising expenses in 1999, 1998 and 1997, respectively.

STOCK-BASED  COMPENSATION

     The  Company adopted Statement of Financial Accounting Standards (SFAS) No.
123,  "Accounting  for  Stock Based Compensation" (SFAS 123) in fiscal 1996.  As
allowed by SFAS 123, the Company has elected to continue to measure compensation
cost  under  Accounting  Principles  Board Opinion No. 25, "Accounting for Stock
Issued  to  Employees"  (APB  25)  and  comply  with  the  pro  forma disclosure
requirements  of  the  new  standard  (see  No.  13).

INCOME  TAXES

     The  Company  records  its  provision  for income taxes using the liability
method.  Under  this  method, deferred tax assets and liabilities are recognized
based  on  the  anticipated  future tax effects arising from financial reporting
basis and tax basis of the Company's assets and liabilities at currently enacted
tax  rates.

EARNINGS  PER  SHARE

     Earnings  per  share  calculations  are  in  accordance with SFAS No,. 128,
"Earnings  per  Share."  "Basic"  earnings per share is computed by dividing net
income  (loss)  by  the weighted average number of common shares outstanding for
the  year.  "Diluted"  earnings  (loss)  per  share  is computed by dividing net
income  (loss)  by  the  total  of  weighted  average  number  of  common shares
outstanding  plus  the dilutive effect of outstanding stock options and warrants
(applying the treasury stock method).  For the years ended December 31, 1999 and
1997,  the effect of stock options and warrants were not included as the results
would  be  antidilutive.

     A  reconciliation  of  the "basic" weighted average number of common shares
outstanding  to  the  "diluted"  weighted  average  number  of  common  shares
outstanding  for each of  the three years in the  period ended December 31, 1999
follows:

<TABLE>
<CAPTION>



<S>                                      <C>         <C>         <C>
                                            1999        1998        1997
                                      ----------  ----------  ----------
Weighted average number of
   common shares outstanding -
   Basic . . . . . . . . . . . . . .  28,177,000  27,747,000  27,365,000
Dilutive effect of outstanding stock
   options . . . . . . . . . . . . .           -     474,000           -
                                      ----------  ----------  ----------
Weighted average number of
   common shares outstanding -
   Dilutive. . . . . . . . . . . . .  28,177,000  28,221,000  27,365,000
                                      ==========  ==========  ==========
</TABLE>

     For  the  year  ended December 31, 1998, 497,000 options have been excluded
from  the  calculation  of dilutive shares applying for treasury stock method as
the option exercise prices were greater than average market price for the period
and  therefore  anti-dilutive.

PRO  FORMA  STATEMENTS  OF  OPERATIONS

     From  January  1,  1997  through  June 30, 1998, Irwin Naturals had elected
treatment  as  an  S  corporation under provisions of the Internal Revenue Code.
Effective  June  30,  1998, Irwin Naturals terminated its S corporation election
and  become a C corporation.  See Note 11 for explanation of pro forma provision
for  income  taxes  and  the  related  pro  forma  net  income  (loss).

USE  OF  ESTIMATES

     The  preparation  of  consolidated  financial statements in conformity with
accounting  principles  generally  accepted  in  the  United  States  requires
management to make estimates and assumptions that affect the reported amounts of
assets, liabilities, disclosure of contingent assets and liabilities at the date
of  the  financial  statements and the reported amounts of revenues and expenses
during  the  reporting period. Actual results could differ from those estimates.

FAIR  VALUE  OF  FINANCIAL  INSTRUMENTS  AND  CONCENTRATION  OF  CREDIT  RISK

     The  Company's  financial  instruments  consist  of  cash, short-term trade
receivables and payables and short-term and long-term debt.  The carrying values
for  all  such  instruments,  considering  the  terms, approximate fair value at
December  31,  1999  and  1998.

     Financial  instruments  that  potentially  subject  the  Company  to
concentrations of credit risk consist primarily of cash and accounts receivable.
Accounts receivable are subject to credit limits, ongoing credit evaluations and
account  monitoring  procedures  to  minimize  the  risk  of  loss.  In  certain
instances,  customer  deposits  are obtained which would also reduce the risk of
loss.  Collateral  is  generally  not  required.

     The  Company  sells  the  majority  of its products and services to various
customers,  which  include  a  variety  of  large  companies  and  distributors
throughout  the  United  States, and to a limited extent, foreign customers.  In
1999,  1998,  and  1997,  sales  to the Company's largest customer accounted for
18.6 % 13.3%, and 15.6%, respectively, of total net sales.  At December 31, 1999
and  1998,  two  customers  represented  35.1% and 36.4% of accounts receivable,
respectively.   In 1999, 1998, and 1997 sales to foreign customers accounted for
7.5  %,  10%,  and  14.1%,  respectively,  of  total  net  sales.

     During  1999,  approximately 64% of the Company's total purchases were from
four  suppliers.  Management  believes  that  if the Company were unable to make
further  purchases  from  these  suppliers, it would be able to find alternative
suppliers  with  terms  and  quality levels similar to those currently in place.

STATEMENTS  OF  CASH  FLOWS

     The Company prepares its statements of cash flows using the indirect method
as prescribed by Statement of Financial Accounting Standards (SFAS) No. 95.  The
Company  considers  all  highly  liquid investments with an original maturity of
three  months  or  less  to  be  cash  equivalents.


                                      F-8
<PAGE>
NEW  AUTHORITATIVE  PRONOUNCEMENTS

     In  December  1999,  the SEC staff released Staff Accounting Bulletin (SAB)
No.  101,  Revenue  Recognition,  to  provide  guidance  on  the  recognition,
presentation  and  disclosure  of  revenue  in financial statements.  Changes in
accounting to apply the guidance in SAB No. 101 may be accounted for as a change
in  accounting  principle  effective  January  1,  2000.  Management has not yet
determined  the  complete  impact  of  SAB  No.  101  on  the  Company; however,
management  does  expect  that  application  of SAB No. 101 will have a material
effect  on  the  Company's  revenue  recognition  and  results  of  operations.

RECLASSIFICATIONS

Certain  amounts in prior years have been reclassified to conform to the current
year's  presentation.


3.     SIGNIFICANT  FOURTH  QUARTER  ADJUSTMENTS

     The  Company  recorded  the following significant adjustments in the fourth
quarter  of  fiscal  1999:

-     Legal  settlement  (see  Note  12)                       $1,200,000
-     Provision  for  doubtful  accounts  for  large
      customer  balances  deemed  uncollectable
      in  the  fourth  quarter                                    916,000
-     Provision  for  discounts  and  rebates  tied
      to  fourth  quarter  sales                                  824,000
                                                           --------------
                                                               $2,940,000
                                                                 ========


4.     BUSINESS  COMBINATIONS

HEALTH  &  VITAMIN  EXPRESS  INC.

     On  February  15,  1999, the Company, through its newly formed wholly owned
subsidiary,  HealthZone.com, purchased for $2,880,000 the issued and outstanding
shares  of  Health  &  Vitamin  Express,  Inc. (HVE), an e-commerce distribution
company.  The purchase consideration consisted of the issuance of 363,636 shares
of  the  Company's  common  stock valued at $2,273,000 ($6.25 per share) and the
assumption of $571,000 of debt. The Company has accounted for the acquisition as
a  purchase,  and  the  excess  purchase  price, including acquisition costs, of
$2,906,000  over  the  fair  value  of net assets acquired has been allocated to
goodwill  and  is  being  amortized  over  5  years.

     In  addition to the 363,636 shares issued upon acquisition, the Company may
contingently  issue  to  the  sellers  of  HVE  (i)  up to 272,727 shares of the
Company's  common  stock  based  upon certain revenue thresholds during first 42
months  subsequent  to  February 15, 1999 (the "Revenue" shares), and (ii) up to
90,909 shares of the Company's common stock based upon certain profit thresholds
during  the  first  seven  years  subsequent  to February 15, 1999 (the "Profit"
shares).  The  Company  has  the  right  to  repurchase  up to 65% of the shares
issued for a period of one (1) year following the date of issuance at a purchase
price  of $13.75 per share (the "Repurchase Price"). The repurchase price may be
adjusted  if upon repurchase the closing bid price of the Company's common stock
as  quoted  on  the  Nasdaq  National  Market  System exceeds $20 per share (the
"Market  Price"),  the  Company  will  pay  to the sellers 50% of the difference
between  the  Market Price and $20 per share.  Furthermore, in the event Revenue
and  Profit  shares are issued because of a funding failure discussed below, the
repurchase  price  shall be reduced to $9.63 per share.  The Company has granted
to  the Sellers certain "demand registration rights" and "piggyback registration
rights"  on  these shares, if issued, in the event the Company undertakes a sale
of  its  securities  to  the  public.

     In  addition,  the  Company  is  obligated  to  invest or contribute to HVE
operations  a  minimum  of  (A)  $4,000,000  during  the 18 months subsequent to
February  15,  1999 and (B) $10,000,000 (inclusive of the $4,000,000 provided in
clause  (A) above) during the 36 months subsequent to February 15, 1999.  If the
Company  fails  to  make  the  investments  or  contributions defined above, the
Sellers  of  HVE will automatically receive the maximum allowable shares subject
to  issuance  under  the provisions of the Revenue and Profit Shares. The former
shareholders  of  HVE have filed a lawsuit against the Company asserting certain
claims  under this agreement. The Company is currently in settlement discussions
with  the  plaintiffs  and  have  proposed  a  settlement  (see  Note  12).

INHOLTRA

     On March 10, 1999, the Company purchased for $13,250,000 certain assets and
liabilities  of  Inholtra Investment Holdings and Trading, N.V., Inholtra, Inc.,
and  Inholtra  Natural,  Ltd.  (collectively  the  Sellers).  The purchase price
consisted of the payment of $3,250,000 in cash at closing, and the issuance of a
$10,000,000 promissory note. The promissory note was refinanced on June 10, 1999
in  connection with the Company's new banking facility (see Note 8). The Company
has  accounted  for  the  acquisition as a purchase. The purchase price has been
allocated  to  the  patents and trademarks associated with the Inholtra product,
and  is  being  amortized  over  a  fifteen-year period. In connection with this
acquisition,  the  Company  entered  into  a  consulting agreement with a former
employee  of the Sellers. The two-year agreement requires annual consulting fees
of  $60,000.

     The  table  below  reflects the unaudited pro forma combined results of the
Company  after  giving  effect to i) the March 10, 1999 acquisition of Inholtra,
and  ii) the February 15, 1999 acquisition of Health & Vitamin Express, Inc, had
the  acquisitions  taken  place  at  the beginning of fiscal 1998. The pro forma
financial  information  does  not necessarily reflect the operating results that
would  have  occurred had the acquisition taken place from the beginning of each
period  presented,  nor  is  such  information  indicative  of  future operating
results.

<TABLE>
<CAPTION>


                                            (Unaudited)
<S>                                      <C>           <C>
                                      ------------  --------
                                             1999      1998
                                      ------------  --------
                                        (in 000's)(in 000's)
Net sales. . . . . . . . . . . . . .  $    36,160   $36,048
Cost of sales. . . . . . . . . . . .       18,246    15,296
Selling, general and administrative.       24,423    19,490
Write-off of intangibles . . . . . .          640         -
Legal settlement . . . . . . . . . .        1,200         -
                                      ------------  --------
Income (loss) from operations. . . .       (8,349)    1,262
Other expense. . . . . . . . . . . .       (1,055)   (1,291)
Benefit for income taxes . . . . . .         (274)        -
                                      ------------  --------
Net loss . . . . . . . . . . . . . .  $    (9,130)  $   (29)
                                      ------------  --------
Loss per share . . . . . . . . . . .  $     (0.32)  $ (0.00)
                                      ------------  --------
</TABLE>


     The  above  amount  includes  adjustments  for  $283,000 and $1,466,000 for
additional  goodwill  amortization  in 1999 and 1998, respectively, and $220,000
and  $1,060,000  for additional interest expense in 1999 and 1998, respectively.

5.     PROPERTY  AND  EQUIPMENT

     Property  and  equipment  consists  of  the  following  at  December  31;

<TABLE>
<CAPTION>



<S>                                      <C>           <C>
                                            1999         1998
                                     ------------  -----------

Machinery and equipment . . . . . .  $   303,000   $  355,000
Furniture and equipment . . . . . .    1,438,000      758,000
Leasehold improvements. . . . . . .      910,000      303,000
                                     ------------  -----------
                                       2,651,000    1,416,000
Less - Accumulated depreciation and
  amortization. . . . . . . . . . .   (1,135,000)    (789,000)
                                     ------------  -----------

                                     $ 1,516,000   $  627,000
                                     ============  ===========
</TABLE>


6.     BUILDING  HELD  FOR  SALE/NOTE  RECEIVABLE

     On  March  25,  1999, the Company completed the sale of its former 4Health,
Inc.  corporate  facility  located  in  Boulder, Colorado (the "Property").  The
sales  price  for  the  Property  was  $2,350,000,  which  consisted of (i) cash
consideration  of  $600,000  that  was  paid  at  closing,  (ii) assumption of a
$1,300,000  exiting  first mortgage loan on the Property by the buyer, and (iii)
the  receipt of a $450,000 promissory note secured by a second trust deed in the
Property.  The  note receivable is to be paid in monthly installments of $3,688,
including  principal  and interest at a rate of 7 1/2% per annum, until March 1,
2002  when  the note is payable in full. The Company's results of operations for
the first quarter of 1999 include a gain of $481,000 that resulted from the sale
of  this  Property.


7.      RECEIVABLES  FROM  OFFICERS  AND  SHAREHOLDER

     Receivables  from  officers  and  shareholder  consist  of the following at
December  31;  1998:

<TABLE>
<CAPTION>



<S>                             <C>                                                               <C>

                                                                                                 1998
                                                                                              ----------
Receivable from the Chief Executive Officer, bearing interest
at an annual rate of 8 percent, collected in full in October 1999                             $ 322,000

Receivable from the President, bearing interest at an annual rate
of 8 percent, $175,000 forgiven during 1999 in connection with
the President's continued employment and $175,000 forgiven in
connection with the termination of the President's employment
(See Note 12)                                                                                 $ 350,000
                                                                                              ---------
                                                                                              $ 672,000
Less Current Portion                                                                          $ 497,000
                                                                                              ---------
                                                                                              $ 175,000

</TABLE>

                                      F-9
<PAGE>

8.     CREDIT  FACILITY

     As  of  December  31,  1998,  the  Company  had  outstanding  borrowings of
$1,000,000  under  a revolving line of credit with a bank. In February 1999, the
outstanding  balance  was  paid  in full and the line was closed. On February 1,
1999,  the Company obtained a new line of credit with a different bank. The line
of  credit  agreement  was subsequently amended in March 1999, and then again on
May  9,  1999.  Maximum borrowings under the amended line of credit were limited
to  $5,000,000 based on eligible accounts receivable and inventories. Borrowings
under  the  line  accrued  interest  at  an annual rate of either prime plus .25
percent  or  LIBOR plus 2.0 percent. The amended line of credit was to expire on
June  30,  1999.

     On June 10, 1999, the Company secured a new loan from a lending institution
that  provides up to $20 million dollars of financing. The loan was subsequently
amended on January 21, 2000.  The credit facility consists of a $13 million term
loan  ("Term  Loan")  and  up to a $7 million revolving loan ("Revolving Loan"),
subject to borrowing base availability and compliance with certain financial and
other  covenants  and  agreements.  At closing, $4,527,000 of loan proceeds were
disbursed  to  repay  and close the Company's previous existing credit facility,
and  $10,000,000 was disbursed to repay the promissory note issued in connection
with  the  acquisition  of  the  assets of Inholtra Naturals, Ltd. (see Note 4).

     The loans under the facility are secured by substantially all the assets of
the  Company.  Borrowings under the Term Loan bear interest at an annual rate of
either  prime  plus  2.25  percent  or  LIBOR  plus  3.75  percent  and are paid
quarterly.  Borrowings  under  the  Revolving Loan currently bear interest at an
annual rate of either prime plus 1.75 percent or LIBOR plus 3.0 percent, and are
paid  quarterly.  The  rates  are  subject  to  decrease  based upon the Company
satisfying  certain  operating performance levels. The credit facility agreement
contains  certain  financial  and other covenants or restrictions, including the
maintenance  of  certain  financial ratios, limitations on capital expenditures,
restrictions  on acquisitions, limitations on the incurrence of indebtedness and
restrictions  on  dividends  paid  by  the Company. As of December 31, 1999, the
Company  was in violation of several covenants, including maintenance of certain
financial  ratios.  The  Company  obtained  a  waiver  from the lender for these
covenants.

     The  Revolving  Loan  commitment,  as revised in connection with the waiver
from  the lender, expires on April 30 2001, when the loan is payable in full. As
of  December  31,  1999,  the  maximum  additional  credit  available  under the
borrowing  limitations  was  $564,000.

     Selected  information  regarding borrowings under line of credit agreements
for  1999  and  1998  follows:

<TABLE>
<CAPTION>



<S>                                            <C>          <C>
                                                 1999         1998
                                           -----------  -----------
Average amount outstanding. . . . . . . .  $3,967,000   $  620,000
Maximum amount outstanding. . . . . . . .  $6,436,000   $1,500,000
Weighted average interest rate during the
   period . . . . . . . . . . . . . . . .         9.1%         8.4%
</TABLE>

     The  $13,000,000 Term Loan is payable in quarterly installments of $583,333
that  began October 15, 1999, and which will increase to $750,000 on October 15,
2002, until the Loan is paid in full on April 15, 2004. In addition, the Company
shall  make a payment of principal on the Term Loan in addition to the quarterly
payments  in  an amount equal to 50% of "Excess Cash Flow" (as defined) for each
fiscal  year.  Each  Excess  Cash  Flow  Payment  shall be applied to reduce the
remaining regularly scheduled principal installments of the Term Loan in inverse
order  of  their  maturity.  Additionally,  upon  receipt  by  Borrower  of  any
unapplied  insurance  or  condemnation  proceeds,  the  proceeds of key-man life
insurance  which has been assigned to an Agent, asset sale proceeds or debt sale
proceeds,  the Company shall make a mandatory prepayment of the Term Loan in the
amount  thereof.  Furthermore,  upon  receipt  by  Borrower  of  any equity sale
proceeds,  Borrower  shall make a mandatory prepayment of (i) the Revolving Loan
to  the limited extent necessary to fully prepay the Revolving Loan or, if less,
in such amount so that borrowing availability after giving effect thereto equals
$3,000,000  and  (ii)  to  the extent of any balance of any equity sale proceeds
after  the  application  to  the  Revolving  Loan  to the extent provided in the
preceding clause, the Term Loan; provided, however, if at the time of receipt of
such  equity  sale  proceeds, no event of default has occurred and is continuing
and  the  debt  to EBITDA ratio meets certain defined levels, then the amount of
such  mandatory  prepayment  on the Term Loan shall be 50% of the amount of such
equity  sale proceeds remaining after application to the Revolving Loan pursuant
to  the preceding clause, and, further, provided, however, if such ratio is less
than a defined amount, then no such prepayment on the Term Loan from equity sale
proceeds  need  be  made.

     As  a  condition of the waiver, the Term Loan and Revolving Loan agreements
will  be  amended to change the expiration dates of both facilities to April 30,
2001.  Further, under the proposed amendment the lender will require the Company
to  meet  certain  revised  financial  ratios.

     Future  annual  payments under the Term Loan, as revised, are as follows as
of  December  31:

<TABLE>
<CAPTION>



<S>                       <C>
YEAR ENDED DECEMBER 31,
------------------------

2000 . . . . . . . . . .  $ 2,332,000
2001 . . . . . . . . . .   10,085,000
                          ------------
                           12,417,000
Less  -  current portion   (2,332,000)
                          ------------

                          $10,085,000
                         =============

</TABLE>


9.     NOTES  PAYABLE

     Notes  payable  consists  of  the  following  at  December  31:

<TABLE>
<CAPTION>
<BTB>

<S>                                                                        <C>         <C>
                                                                             1999         1998
                                                                        ----------  -----------

Note payable to a bank assumed by the buyer of the Boulder Building. .  $       -   $1,300,000
(see Note 6)

Notes payable to three individuals, unsecured, bearing interest at an.    155,000      451,000
annual rate of 6.0 percent, payablein monthly installments of
principal and interest of approximately $26,000, due June 2000

Capital lease obligation (see Note 12) . . . . . . . . . . . . . . . .    123,000            -
                                                                        ----------  -----------
                                                                          278,000    1,751,000
Less current portion . . . . . . . . . . . . . . . . . . . . . . . . .   (176,000)    (328,000)
                                                                        ----------  -----------
                                                                        $ 102,000   $1,423,000
                                                                        ==========  ===========
</TABLE>


     Future  annual  payments  under  the  notes  payable  and  capital  lease
obligations  are  as  follows  as  of  December  31,  1999:


<TABLE>
<CAPTION>

<S>            <C>
Year ended
-------------
December 31,
-------------

2000. . . . .  $176,000
2001. . . . .    23,000
2002. . . . .    26,000
2003. . . . .    30,000
2004. . . . .    23,000
-------------  --------

                278,000
          =============
</TABLE>

10.     WRITE-OFF  OF  INTANGIBLES

     The  Company  acquired  ID Technology in connection with a 1996 merger.  ID
Technology is used in angioplasty procedures.  In the third quarter of 1999, the
Company  determined  that  the  value  of  such  technology  was  impaired  and,
therefore,  wrote-off  the  remaining  unamortized  balance  of  $390,000.  In
addition,  the  Company  wrote-off  $250,000  of  inventories  related  to  this
technology.  Total  charges  in  connection  with this impairment were $640,000.

11.      INCOME  TAXES

     From  January  1,  1997  through  June 30, 1998, Irwin Naturals had elected
treatment  as  an  S  corporation under provisions of the Internal Revenue Code.
Effective  June  30,  1998, Irwin Naturals terminated its S corporation election
and  became a C corporation. As such, the actual taxes due by Irwin Naturals for
the  period from January 1, 1997 to June 30, 1998 are based on S corporation tax
rates, which are substantially less than C corporation tax rates. As a result of
the  "pooling  of  interests"  between  Irwin  Naturals  and  4Health, Inc., the
accompanying  statements  of operations for 1998 and 1997 reflect historical tax
provisions  which  are a combination of both C corporation and S corporation tax
rates.  Because  of the Irwin Natural's change in tax status, historical results
of  operations, including income taxes and earnings (loss) per share information
may  not,  in  all  cases,  be comparable to or indicative of current and future
results.  Therefore, the statements of operations for 1998 and 1997 also include
unaudited  pro  forma  provisions  for  income taxes and resulting unaudited pro
forma  net  income  (loss)  and  unaudited  pro  forma earnings (loss) per share
information as if Irwin Naturals had been a C corporation during the period from
January  1,  1997  to  June  30,  1998.

     The  Company accounts for income taxes under the provisions of Statement of
Financial  Accounting  Standards  (SFAS)  No.  109. Under SFAS No. 109, deferred
income  tax assets or liabilities are computed based on the temporary difference
between  the  financial statement and income tax bases of assets and liabilities
using  the  current  marginal  income  tax rate. Deferred income tax expenses or
credits  are  based  on  the  changes  in  the  deferred  income  tax  assets or
liabilities  from  period  to  period.

     Deferred  tax  assets may be recognized for temporary differences that will
result  in  deductible  amounts  in future periods and for loss carryforwards. A
valuation allowance is recognized if, based on the weight of available evidence,
it  is  more  likely than not that some portion or all of the deferred tax asset
will not be realized. As of December 31, 1999 and 1998, the Company had recorded
valuation  allowances.

     The  components  of  the  deferred  income  tax  assets (liabilities) as of
December  31,  1999  and  1998  are  as  follows:

<TABLE>
<CAPTION>



<S>                                  <C>                   <C>
                                       1999                  1998
                                 -----------  --------------------
Allowance for doubtful accounts  $1,265,000   $           369,000
Inventory tax adjustment. . . .     484,000                83,000
Inventory reserve . . . . . . .     216,000               186,000
Warrants. . . . . . . . . . . .     373,000                52,000
Accrued liabilities . . . . . .     588,000                33,000
NOL carryforwards . . . . . . .   3,872,000             2,817,000
Other . . . . . . . . . . . . .           -               288,000
                                 -----------  --------------------
                                  6,798,000             3,828,000
Valuation allowance . . . . . .  (6,798,000)           (3,828,000)
                                 -----------  --------------------
                                 $        -   $                 -
                                 ===========  ====================
</TABLE>

     At  December  31,  1999,  the  Company  has  federal  net  operating  loss
carryforwards  of  approximately  $9,405,000  expiring  at various dates through
2019.  Future  use  of  these  net  operating  loss carryforwards may be limited
subject  to  certain  provisions  of  the  Internal  Revenue  Code.

     The  components of the provision (benefit) for income taxes for the periods
ended  December  31,  1999,  1998  and  1997  are  as  follows:


<TABLE>
<CAPTION>

<S>                          <C>         <C>              <C>
                              1999       1998             1997
                         ----------  --------  ----------------
Current:
   Federal. . . . . . .  $(274,800)  $287,000  $       (17,000)
   State. . . . . . . .        800    131,000           (1,000)
                         ----------  --------  ----------------
                          (274,000)   418,000          (18,000)
Deferred. . . . . . . .          -    182,000           18,000
                         ----------  --------  ----------------
Provision (benefit) for
   income taxes . . . .  $(274,000)  $600,000  $             -
                         ==========  ========  ================
</TABLE>

     Differences  between the provision for income taxes and income taxes at the
statutory  federal  income  tax  rate  are  as  follows:

<TABLE>
<CAPTION>



<S>                                         <C>                        <C>                    <C>
                                      December 31, 1999          December 31, 1998     December 31, 1997
                                      -------------------------  --------------------  ---------------------

Income tax at statutory federal rate     (3,106,000)   (34.0)%    $550,000   34.0 %  (1,604,000) (34.0)%
State income taxes . . . . . . . . .       (502,000)    (5.5)      131,000    8.1      (236,000)  (5.0)
S corporation income not taxed at
   C corporation rates . . . . . . .              -        -      (374,000) (23.1)     (765,000) (16.2)
Permanent differences. . . . . . . .        407,000      4.5       156,000    9.6             -      -

Use of net operating loss. . . . . .              -        -      (332,000) (20.5)            -      -
Carryforwards
Change in valuation allowance. . . .      2,970,000     32.5       469,000   29.0     3,271,000   69.3
Current losses not benefited . . . .        690,000      7.5
Reversal of 1998 excess provision. .       (274,000)    (3.0)            -      -             -      -
Other items, net . . . . . . . . . .       (459,000)    (5.0)            -      -      (666,000) (14.1)
                                      -------------------------  --------------------  -----------------
                                           (274,000)    (3.0)%    $600,000   37.1 %  $        -      -%
                                      =========================  ====================  ================
</TABLE>


     The  components  of  the unaudited pro forma provision for income taxes for
1998  and  1997  are  as  follows:

<TABLE>
<CAPTION>



<S>                                        <C>              <C>
                                  December 31, 1998  December 31, 1997
                                      -------------  ------------------
Federal. . . . . . . . . . . . . . .  $     890,000  $          633,000
                                      -------------  ------------------
State. . . . . . . . . . . . . . . .        271,000             114,000
                                      -------------  ------------------
                                          1,161,000             747,000
Deferred . . . . . . . . . . . . . .        184,000              18,000
                                      -------------  ------------------
Pro forma provision for income taxes  $   1,345,000  $          765,000
                                      =============  ==================
</TABLE>


     Differences  between the unaudited pro forma provision for income taxes and
income  taxes  at  the  statutory  federal  income  tax  rate  are  as  follows:

<TABLE>
<CAPTION>



<S>                                  <C>                          <C>
                                 December 31, 1998        December 31, 1997
                                 -----------------------  ------------------------
Income tax at statutory federal
  rate. . . . . . . . . . . . .  550,000         34.0 %     (1,604,000)    (34.0) %
State income taxes. . . . . . .  271,000          16.8        (236,000)     (5.0)
Permanent differences . . . . .  372,000          22.9           -            -

Use of net operating loss . . .  (332,000)       (20.5)          -            -
Carryforwards
Change in valuation allowance .  484.000          29.9       3,271,000      69.3
Other, net. . . . . . . . . . .      -                -       (666,000)    (14.1)
                                 -----------------------  ------------------------
                                 1,345,000        83.1 %       765,000      16.2 %
                                 =======================  ========================
</TABLE>

                                      F-10
<PAGE>

12.     COMMITMENTS  AND  CONTINGENCIES

CAPITAL  AND  OPERATING  LEASE  OBLIGATIONS  PAYABLE

     The  Company  leases  its facility and certain property and equipment under
long-term  operating leases expiring at various dates through 2004.  The Company
also  leases property and equipment under a capital lease.  Included in property
and  equipment  is  $132,000,  at  cost,  related  to  capital  leases.

     The  future  minimum  lease payments at December 31, 1999 under capital and
operating  leases  are  as  follows:

<TABLE>
<CAPTION>



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

                              Capital    Operating
                              Leases     Leases      Total
                              ---------  ----------  ----------
2000 . . . . . . . . . . . .  $ 35,000   $  672,000  $  707,000
2001 . . . . . . . . . . . .    35,000      667,000     702,000
2002 . . . . . . . . . . . .    35,000      656,000     691,000
2003 . . . . . . . . . . . .    35,000      647,000     682,000
2004 . . . . . . . . . . . .    23,000      292,000     315,000
                              ---------  ----------  ----------
Total future minimum lease
   payments. . . . . . . . .   163,000   $2,934,000  $3,097,000
                                         ==========  ==========
Less - amount representing
   interest at 12% . . . . .   (40,000)
                              ---------
Present value of minimum
   capital lease payments. .   123,000
Less  -  current portion . .   (21,000)
                              ---------
                               102,000
                              =========
</TABLE>


     Total  rental  expense for the years ended December 31, 1999, 1998 and 1997
was  approximately  $588,000,  $557,000  and  $390,000,  respectively.

EMPLOYMENT  CONTRACTS

     Upon  the  consummation  of  the Merger, both Mr. R. Lindsey Duncan and Mr.
Klee  Irwin  entered into substantially similar three-year employment agreements
with  the  Company.  Mr.  Duncan  was employed as Chairman of the Board and as a
member  of the Executive Committee with all duties and responsibilities normally
associated  with  this  position.  Mr. Irwin was employed as the Chief Executive
Officer  and  as  a  member  of  the  Executive  Committee  with  all duties and
responsibilities normally associated with this position until April 20, 1999. On
that date, Mr. Irwin resigned, as Chief Executive Officer of Omni Nutraceuticals
and  his  employment  agreement  was  terminated  effective  April  20, 1999. In
connection  with  his  resignation the Board of Directors appointed him as Chief
Executive  Officer  of  HealthZone.com,  the  Company's  wholly owned subsidiary
("HealthZone").  In  October  of  1998  (as  revised  in June 1999), the Company
entered  into  an  agreement  to  hire  Mr. Louis Mancini as President and Chief
Operating  Officer  and,  subsequently,  Chief  Executive  Officer.

     These  employment agreements provided for: (i) annual salaries of $225,000,
and  $300,000  for  Messrs. Duncan and Mancini, respectively; (ii) the right for
Mr.  Duncan  and  Mr.  Mancini  to  receive  an  annual  bonus  based on certain
performance  incentives.

     On  March 12, 2000, Mr. Duncan agreed to resign from the Board of Directors
of  the  Company and agreed to terminate his employment agreement. Also on March
12, 2000, the Board of Directors terminated Mr. Mancini's employment. Klee Irwin
replaced  Mr.  Mancini  as  President  and  Chief  Executive  Officer.

     As  a result of the March 12, 2000 employment realignments, the Company has
the  following  obligations  to  the  above  individuals:

-     Lindsay  Duncan:     extension  of  exercise  and  expiration  dates  for
                           1,003,029 stock  options  to  March  2007
-     Louis  Mancini:      payout  accrued vacation, forgiveness of $175,000
                           note receivable  (see  Note  6)
-     Klee  Irwin:         none

LEGAL

     On  December  23,  1999,  a  lawsuit  was  filed  against  the Company, the
Company's  former  President  and  Chief  Executive Officer, Klee Irwin, and the
Company's  then current President, Louis Mancini, entitled David Mandel, Jeffrey
                                                           ---------------------
D.  Segal  and  Gordon D. Barker v. Omni Nutraceuticals, Inc., Klee Irwin, Louis
--------------------------------------------------------------------------------
Mancini and Does 1 through 50 (Superior Court of the State of California, County
-----------------------------
of  Los  Angeles  -  Central District, Case No. BC222263).  The lawsuit includes
various  causes  of  action,  including  fraud,  negligent  misrepresentation,
misappropriation  of trade secrets, unjust enrichment, unfair business practices
and  violations of the Racketeer Influenced and Corrupt Organizations Act (RICO)
(under which triple damages have been claimed).  The lawsuit is based on various
alleged claims, including that the plaintiffs, the sole shareholders of Health &
Vitamin  Express  ("HVE"),  were  fraudulently  induced  to  enter into a merger
agreement  pursuant to which HVE became a wholly-owned subsidiary of the Company
based  on false representations of the defendants.  The lawsuit does not specify
the  amount  of  damages claimed.  Although the Company believes that the claims
made  in  the  lawsuit are without merit, the Company is currently in settlement
negotiations  with  the  plaintiffs  in  the lawsuit.  The proposed terms of the
settlement  provide  that the Company will issue an additional 363,636 shares of
common  stock  to  the former shareholders of HVE.  Management believes that the
claims will be settled in accordance with the proposed settlement agreement.  As
such,  the  Company  has  estimated  and  recorded a charge of $1,200,000 in the
accompanying  statement of operations as of December 31, 1999 in connection with
this  claim.

     The Company has been named as defendant in various other claims arising out
of  the  normal course of business. In the opinion of management, the outcome of
these claims will not have a material effect on the Company's financial position
or  results  of  operations.

13.     SHAREHOLDERS'  EQUITY

PREFERRED  STOCK

     The  Company  has authorized 5,000,000 shares of Preferred Stock. Under the
terms  of  the  Article  of  Incorporation,  the  Board  of  Directors may issue
Preferred Stock for any proper corporate purpose. In approving any issuance, the
Board  has  broad authority to determine the rights, privileges, and preferences
of  the  Preferred  Stock, which may be issued as one or more classes or series.
The rights, privileges and preferences may include voting, dividend, conversion,
redemption,  participation  and  liquidation rights. As of December 31, 1999 and
1998,  no  Preferred  Stock is issued or outstanding. Subsequent to December 31,
1999,  the  Company  amended  its  Articles  of  Incorporation  to allow for the
issuance  of  a  new  series  of  Convertible  Preferred  Stock  (see  Note 16).

COMMON  STOCK

     In  February  1999,  the  Company  issued 363,636 shares of common stock in
connection  with  the  acquisition  of  HVE  (see  Note  4).

     In  August  1999,  the  Company entered into a three-year agreement with an
individual  to  be  the spokesperson for its Inholtra product line.  The Company
issued  15,000  shares  of  common stock and recorded compensation of $36,000 in
connection  with the issuance of these shares.  In addition, the Company granted
this  individual  an  option  to  purchase  75,000  shares of common stock.  The
Company  recorded compensation expense of $29,000 in 1999 in connection with the
grant  of  these  options  to  this  non-employee.

     In  October  1999,  the Company issued 13,000 shares of common stock to its
previous  facility  landlord  in  lieu  of  cash  for one month's rent due.  The
Company  recorded  expense  of  $19,000 in connection with the issuance of these
shares.

     In  October  1999,  the  former  Chief  Executive  Officer  and shareholder
returned  941,436  shares  to  the  Company  as  a contribution to capital.  The
Company  retired  these  returned  shares.

     During  1999,  the  Company  issued  25,000  shares  of  common  stock to a
consultant  in  exchange  for  services  performed  during the same period.  The
Company  recorded  compensation  of  $120,000 in connection with the issuance of
these  shares.

     In  September  1997,  pursuant to a clause in a July 1996 merger agreement,
500,000  additional  shares  common  stock  were  issued  to  "pre-1996  merger"
shareholders  to  realign  the  equity  interests.

WARRANTS

     In 1997, the Company entered into a three year consulting agreement with an
investment-banking  firm.  In  consideration  for  the  consulting services, the
Company issued the investment-banking firm warrants to purchase 1,000,000 shares
of  the  Company's  common  stock  at  an  exercise price of $6.00 per share and
additional  warrants  to  purchase 250,000 shares of common stock at an exercise
price  of  $4.00 per share. The warrants are exercisable for five years from the
date  of  issuance.  The  Company  recorded  professional  services  expense  of
$388,000,  $388,000  and  $275,000  in  1999,  1998  and  1997, respectively, in
connection  with  the  fair value of these warrants based upon the Black Scholes
pricing  model.  As  of  December 31, 1999, all warrants were still outstanding.

     During  the  year  ended  December  31,  1999,  the  Company entered into a
consulting  agreement  with  an  advisor.  In  consideration  of  the consulting
services,  the  Company issued to the advisor warrants to purchase 62,500 shares
of  the  Company's  common  stock  at  an exercise price of $4.75 per share. The
Company recorded professional services expense of $415,000 in 1999 in connection
with  the  fair  value  of  these  warrants based upon the Black Scholes pricing
model.  These  warrants  were  exercised  subsequent  to  year-end.

     Subsequent  to  year-end,  the  Company  issued 775,000 warrants to acquire
shares  of  common stock at $2.25 per share in connection with the issuance of a
new  series  of  Convertible  Preferred  Stock  (see  Note  16).


                                      F-11
<PAGE>
STOCK  OPTIONS

     In  1996,  the  Company adopted the Long-Term Stock Incentive Plan (LTSIP).
This  plan  was amended on December 22, 1999.  Under the terms of the LTSIP, the
Company  is authorized to issue incentive and non-qualified stock options to its
directors,  officers,  key  employees  and  consultants totaling up to 4,500,000
shares  of  common stock. At December 31, 1999, 653,402 shares are available for
future  grant  under this plan. Options are generally granted at exercise prices
not  less than the fair market value on the date of grant and expire from two to
seven  years  after the date of grant. Options granted under this plan vest over
varying  terms  ranging  from  immediate  vesting  to  seven  years.

     In  November 1998, the Company's Board of Directors approved a stock option
pool  authorizing  management  of the Company to make discretionary grants up to
500,000  shares.

     In 1996, the Company adopted SFAS 123. Therefore, the following information
is  presented  in  accordance  with  the  provisions  of  SFAS  123.

     A  summary  of  the  Company's  outstanding  options  and activity follows:

<TABLE>
<CAPTION>


<S>                         <C>          <C>        <C>        <C>
                                                     Exercisable
                                         WEIGHTED              WEIGHTED
                                         AVERAGE               AVERAGE
                            NUMBER OF    EXERCISE   NUMBER OF  EXERCISE
                            OPTIONS      PRICE      OPTIONS    PRICE
                            -----------  ---------  ---------  ---------
Balance, January 1, 1997 .     866,103   $    4.35
Granted. . . . . . . . . .     192,500        5.92
Exercised. . . . . . . . .    (186,396)       4.01
Cancelled. . . . . . . . .    (129,564)       6.00
                            -----------  ---------
Balance, December 31, 1997     742,643        4.57    585,516  $    4.24
                                                    =========  =========
Granted. . . . . . . . . .   1,853,860        5.22
Exercised. . . . . . . . .    ( 38,341)       4.51
Cancelled. . . . . . . . .    (111,991)       5.46
                            -----------  ---------
Balance, December 31, 1998   2,446,171        5.01    675,253  $    4.49
                                                    =========  =========
Granted. . . . . . . . . .   3,167,500        2.15
Exercised. . . . . . . . .     (19,670)       4.33
Cancelled. . . . . . . . .  (1,747,403)       5.03
                            -----------  ---------
Balance, December 31, 1999   3,846,598   $    2.58  1,991,904  $    3.34
                            ===========  =========  =========  =========
</TABLE>


     Weighted  average  fair  value  of  all  options granted during years ended
December  31  1999,  1998  and  1997  were $1.13, $1.99 and $1.62, respectively,


                                      F-12
<PAGE>
The  following  table  summarizes  information  about the options outstanding at
December  31,  1999:

<TABLE>
<CAPTION>



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

                 Number           Weighted  Weighted                     Weighted
                 outstanding at   Average   Average     Exercisable at   Average
Range of. . . .  December 31,     Exercise  Remaining   December 31,     Exercise
Exercise Prices  1999             Price     Life        1999             Price

$  2.00 - $2.99  1,137,500       $  2.23   9.7 years     975,000         $2.21
$  3.00 - $3.99  1,818,955          3.20   8.8 years     593,871          3.61
$  4.00 - $6.00    870,729          5.77   8.9 years     413,229          5.51
$  6.01 - $8.75     19,414          7.40   7.5 years       9,804          7.93

                 3,846,598       $  3.51               1,991,904         $3.34
                 =========       =======               =========         =====
</TABLE>

     The  Company  has  elected  to  continue  to  measure  compensation  costs
associated  with  its  stock option plan under APB No. 25, "Accounting for Stock
Issued  to  Employees"  and comply with the pro forma disclosure requirements of
SFAS No. 123. Had the Company applied the fair value based method of accounting,
which  is  not required, to all grants of stock options, under SFAS No. 123, the
Company  would  have  recorded  additional compensation expense and computed pro
forma  net  income  (loss)  and  pro  forma earnings (loss) per share amounts as
follows  for  1999,  1998  and  1997  as  follows:

<TABLE>
<CAPTION>

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

                                               1999       1998         1997
                                       -------------  --------  ------------
Additional compensation expense . . .  $  3,004,000   $672,000  $   281,000
Pro forma net income (loss) . . . . .   (11,865,000)   346,000   (4,998,000)
Pro forma earnings (loss) per share:
   Basic. . . . . . . . . . . . . . .  $      (0.43)  $   0.01  $     (0.18)
   Diluted. . . . . . . . . . . . . .  $      (0.43)  $   0.01  $     (0.18)
</TABLE>

     These  pro forma amounts were determined by computing the fair vale of each
option  on  its grant date using the Black-Scholes option-pricing model with the
following  assumptions:

<TABLE>
<CAPTION>

<S>                         <C>           <C>          <C>
                            1999           1998        1997
                         --------  -------------  ----------
Risk free interest rate     6.03%      4.34%-5.55%     5.97%
Expected life . . . . .  4 years      2 to 7 years   2.2 years
Volatility. . . . . . .    90.00%         60.00%      60.68%
Expected dividend yield    None           None         None

</TABLE>

14.     RELATED  PARTY  TRANSACTIONS

     From  January 1, 1997 through June 30, 1998, the Company made distributions
totaling  $1,682,000  ($579,000  in  1997  and  $1,103,000  in  1998)  to  the S
corporation  shareholders  of  Irwin  Naturals. These distributions were for tax
liabilities  to  be paid by the S corporation shareholders attributable to their
respective  S  corporation  income.

     During the year ended December 31, 1999, a bonus of $50,000 was paid to Mr.
Lindsey  Duncan,  Chairman  of  the  Board.

     On  October  8,  1999,  the  Company  and  Mr.  Klee  Irwin  entered into a
settlement  agreement  (the  'Settlement Agreement') in order to resolve certain
mutual  claims  that had arisen between the Company and Mr. Irwin. Subsequent to
year-end,  the  Settlement  Agreement  and  all  ancillary  agreements  thereto,
including the voting agreement between Mr. Duncan and Mr. Irwin were terminated.

     On  or  about  October  8,  1999,  Mr. Irwin made a capital contribution of
$305,000,  and returned 941,436 shares of Omni Nutraceutical common stock to the
Company.

15.     SEGMENT  INFORMATION

     In  1997 and 1998, the Company operated as one reportable business segment.
Since  February  15,  1999,  concurrent  with  the  acquisition of the Company's
e-commerce  operations  by its subsidiary HealthZone (see Note 4), the Company's
businesses have been organized, managed and internally reported as two segments:
wholesale  and  retail  product distribution, and e-commerce. These segments are
based  on  differences  in  products,  customer  type and sales and distribution
methods.  The  distribution  segment  consists  primarily  of  the  sales of the
Company's  products  directly  to  retailers,  wholesalers,  mass  merchants and
distributors  who stock and manage inventory within health stores. The Company's
e-commerce  business,  HealthZone.com,  enables  customers  to  choose  from the
Company's  brand-name  products  and also gives customers the opportunity to buy
products  from  other  vendors.


                                DISTRIBUTION     E-COMMERCE     TOTAL
                                ------------     ----------     -----
1999
----
Net sales                       $35,013,000     $295,000     $35,308,000
Cost of sales                    17,635,000      212,000      17,847,000
Gross profit                     17,378,000       83,000      17,461,000
Costs and expenses               25,050,000      717,000      25,767,000
Loss from Operations             (7,672,000)    (634,000)     (8,306,000)
Interest income                      32,000           -           32,000
Interest expense                 (1,326,000)     (13,000)     (1,339,000)
Other income (expense)              479,000       (1,000)        478,000
Benefit for income taxes           (274,000)          -         (274,000)
Net loss                         (8,213,000)    (648,000)     (8,861,000)
Depreciation and amortization     1,875,000       17,000       1,892,000
Assets                           31,669,000       58,000      31,727,000
Expenditures  for  long-lived
assets                           15,154,000           -       15,154,000


16.     SUBSEQUENT  EVENTS

     Financings  -  On  January  24,  1999,  the  Company  completed  an  equity
     ----------
transaction  with  American  Equities,  LLC and Corporate Financial Enterprises,
Inc. that will provide up to $5,000,000 of capital to the Company and its wholly
owned  subsidiary  HealthZone.com  (HealthZone).

     Under  the terms of the transaction, the Company will issue up to 4,500,000
shares of its newly created 5% Convertible Preferred Stock, Series A ("Preferred
Shares  ")  and  seven  year  warrants to purchase up to an aggregate of 775,000
shares  of  common  stock  at  an  exercise price of $2.25 per share, subject to
adjustment.  The  aggregate purchase price for the Preferred Shares and warrants
is $4,000,000 payable in two installments, the first in the amount of $2,000,000
that  was funded on January 21, 2000, and subject to the satisfaction of certain
performance  targets, the second in the amount of $2,000,000.  Concurrently with
the  first  installment  payment, HealthZone issued 222,222 shares of its common
stock  (representing  approximately  10%  of HealthZone's issued and outstanding
shares of common stock) and a seven year warrant to purchase up to 37,000 shares
of  its  common  stock at an exercise price, subject to adjustment, equal to the
lesser  of  $1.00  or  70%  of the lowest price received by HealthZone on future
sales  of its capital stock, for a purchase price of $1,000,000. The Company has
also  agreed  to  lend HealthZone $1,000,000 out of second installment proceeds.
The  Company  will  use  the  proceeds from the sale of its securities to reduce
indebtedness  and  for  working  capital  purposes.  The  Preferred  Shares  are
convertible  into  an  aggregate  of  3,000,000  shares  of Company common stock
(assuming  issuance  of  the  full  amount  of  Preferred  Shares),  subject  to
adjustment.  The  Preferred  Shares  are  not  redeemable  but may be subject to
mandatory conversion under certain circumstances. The Preferred Shares will vote
together  with  the  common  stockholders on an as converted basis and will have
separate  class  voting  rights  to  elect  one  director and in connection with
certain  corporate  changes.  The  Preferred  Shares  will  carry  a liquidation
preference  of  $0.60  per share and an annual dividend rate of $0.05 per share,
payable  semi-annually.  The Company may elect to pay the dividend in additional
Preferred  Shares  at  a  rate  of  .05 shares per share.  The investor was also
provided  certain  registration  rights  in connection with this transaction. In
connection  with the above transaction, the Company has (i) amended its Articles
of  Incorporation  to  provide  for  the  Preferred  Shares,  (ii)  amended  the
Settlement Agreement between the Company and Klee Irwin as it related to certain
funding provisions of HealthZone, and (iii) entered into two separate consulting
agreements,  one  of  which  requires the Company to issue 560,000 shares of its
Common  Stock.  Further,  in connection with the above transaction, the Chairman
and the former Chief Executive Officer, both significant shareholders, each sold
220,000  (totaling 440,000) shares of their personally held Company common stock
to  the  investing  parties  for  $250,000  (totaling  $500,000).

      On  March 29, 1999, the Company completed a private sale of its securities
whereby 700,000 shares of common stock of the Company were sold for an aggregate
purchase  price  of  $2,100,000.  The  investor  was  also  provided  certain
registration  rights  in  connection  with  this  transaction.

     The  pro  forma  effect  of  these  transactions as if they had occurred at
December  31, 1999 is as follows, before giving effect to any application of the
proceeds:

<TABLE>
<CAPTION>



<S>                                             <C>                 <C>           <C>
                                            Balance             Pro forma     Pro forma
                                            December 31, 1999   Adjustments   December 31, 1999
                                            ------------------  ------------  ------------------
ASSETS
Current assets . . . . . . . . . . . . . .  $       13,298,000  $  5,100,000  $       18,398,000
Other assets . . . . . . . . . . . . . . .          18,429,000             -          18,429,000
                                            ------------------  ------------  ------------------

Total assets . . . . . . . . . . . . . . .  $       31,727,000  $  5,100,000  $       36,827,000
                                            ==================  ============  ==================

LIABILITIES AND SHAREHOLDERS' EQUITY
Line of credit . . . . . . . . . . . . . .  $        6,436,000  $          -  $        6,436,000
Other current liabilities. . . . . . . . .          13,226,000             -          13,226,000
Debt, net of current portion . . . . . . .          10,187,000             -          10,187,000
Shareholders' equity . . . . . . . . . . .           1,878,000     5,100,000           6,978,000
                                            ------------------  ------------  ------------------

Total liabilities and shareholders' equity  $       31,727,000  $  5,100,000  $       36,827,000
                                            ==================  ============  ==================
</TABLE>

     Other  -  In January 2000, the Company issued 75,000 shares of common stock
     -----
to  its  three  then  current  outside  board  of  directors as compensation for
services.

Effective  January  24,  2000,  the  Company  entered into a two year consulting
agreement  with an advisor that required the issuance of 1,200,000 shares of the
Company's  common  stock. 400,000 of these shares may be returned to the Company
if  at  any  time during the second year of the consulting agreement the Company
gives  the  consultant  a  properly  noticed  Early  Termination  Notice.

     In  March  2000,  the  Company  formed  a  joint venture for the purpose of
distributing  its  products  throughout  the  European  Union.  The  Company
contributed  $5,000  for  a  50  percent  ownership  in  the  venture.

     In  March and April 2000, the Company signed term sheets constituting their
intent  to  acquire two separate companies.  Under the currently proposed terms,
if  the  acquisitions  are consummated, the Company will issue 240,000 shares of
common  stock  as  purchase consideration (120,000 shares for each acquisition).

                                      F-13
<PAGE>