<PAGE>

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

                                  FORM 10-KSB

(Mark One)

  X    ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
-----
       1934 (FEE REQUIRED)

       For the fiscal year ended December 31, 1999

                                      OR

___    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
       ACT OF 1934 (NO FEE REQUIRED)

       For the transition period from _____ to _____

                         Commission File No.  0-18438
                                              -------

                      VITAFORT INTERNATIONAL CORPORATION
                      ----------------------------------
                (Name of Small Business Issuer in its Charter)

            Delaware                                     68-0110509
            --------                                     ----------
  (State or Other Jurisdiction of           (I.R.S. Employer Identification No.)
  Incorporation or Organization)

    1800 Avenue of the Stars, Suite 480, Los Angeles, California       90067
    ---------------------------------------------------------------------------
     (Address of Principal Executive Offices)                        (Zip Code)

                                (310) 552-6393
                                --------------
               (Issuer's Telephone Number, Including Area Code)

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

                                                     Name of Each Exchange
     Title of Each Class                              on Which Registered
     -------------------                              -------------------
          None                                                None

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

                        COMMON STOCK, PAR VALUE $.0001
                        ------------------------------
                               (Title of Class)

Check whether the issuer:  (1) Filed all reports required to be filed by Section
13 or 14(d) of the Exchange Act during the past 12 months (or for such shorter
period that the Registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.

                            Yes   X          No ____
                                -----

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this form 10-KSB.   [X]

State issuer's revenues for its most recent fiscal year:  $2,451,531.

The aggregate market value of the voting stock held by non-affiliates computed
by reference to the average bid and asked prices of such stock on April 11, 2000
was $3,144,300.

The number of shares outstanding of the issuer's common stock as of April 11,
2000 was 18,411,977.

Transitional Small Business Disclosure Format (check one):  Yes ___   No   X
                                                                          ---

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                                    PART I

Certain statements contained in this Annual Report on Securities and Exchange
Commission ("SEC") Form 10-KSB ("Form 10-KSB") constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements involve known and unknown risks, uncertainties and
other factors that may cause our or our industry's actual results, levels of
activity, performance or achievements to be materially different than any
expressed or implied by these forward-looking statements. These statements may
be contained in our filings with the Securities and Exchange Commission, press
releases, and written or oral presentations made by our representatives to
analysts, rating agencies, stockholders, news organizations and others. In some
cases, you can identify forward-looking statements by terminology such as "may,"
"will,"  "should," "intend", "expects," "plans," "anticipates," "believes,"
"estimates," "predicts," "potential," "continue," or the negative of these terms
or other comparable terminology.  Although we believe that the expectations in
the forward-looking statements are reasonable, we cannot guarantee future
results, levels of activity, performance or achievements.


ITEM 1. DESCRIPTION OF THE BUSINESS

GENERAL

Vitafort International Corporation (The "Company" or "Vitafort" or "Registrant")
was formed as a California corporation in 1986, and reincorporated as a Delaware
corporation in 1989 prior to its initial public offering.  We were originally
formed to develop value added foods and beverages for third parties. In 1993
Vitafort changed its strategic direction and began developing, distributing and
marketing proprietary healthy snacks under Company owned brands.  This business
model has continued throughout the 1990's as we introduced numerous product
lines to thousands of stores and many of the leading retailers throughout the
country such as; Wal-Mart, Costco, Sam's Club, Kroger, Albertsons, Food Lion,
Winn Dixie, Ahold, Eckerd's, along with many others.

Vitafort continues to develop, market and distribute snacks to the retail
grocery trade, however the Company has created a wholly owned subsidiary,
Visionary Brands, Inc., to execute this strategy.  Visionary Brands is in the
business of creating brands and products in the grocery industry, and
manufacturing and distributing the same.   These products are marketed under
Company-developed brands such as "Peanut Squeeze" or licensed brands procured by
the Company such as "The Wizard of OZ" marshmallows.  The Company markets these
licensed brands through its wholly owned subsidiary, Hollywood Partners.  The
Company develops these products from the actual conception of the product idea
to the shipment of the product to the retailer.  Over the last year the Company
has focused on its two primary product lines, "Peanut Squeeze" and "The Wizard
of Oz" marshmallows, a Hollywood Partners brand under license from Warner Bros.

Juliette's chocolate truffles have been reintroduced as a smaller 2-pack
purchase with a portion of the proceeds supporting breast cancer research.  The
new package will be more affordable and lends itself to a much broader target of
consumers.

Visionary Brands' newest product is called the "Gravity Bar," a Hollywood
Partners.com license from eMap Publishing, Inc.   The Gravity Bar represents an
entry into one of the fastest growing categories in the food industry, energy
bars (up 48% in 1999, source:  A.E. Neilsen).  The addition of the Gravity Bar
allows entry into entirely different classes of trade such as sporting goods
stores and health clubs.

On September 13, 1999, pursuant to a share Exchange and Reorganization
Agreement, the Company exchanged all the issued and outstanding shares of
Hollywood Partners, Inc., a California corporation ("Operating Company") that
previously operated as a wholly owned subsidiary of Vitafort International

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Corporation. In consideration for the shares of Hollywood Partners, the Company
received an aggregate of 5,000,000 shares of a reporting shell which changed its
name to Hollywood Partners.com, Inc. ("HP.com"). HP.com common stock is now
traded on the OTC BB. (Symbol: HLYP). Vitafort is currently the majority
shareholder of HP.com, holding 4.62 million shares of the 8,036,000 shares, or
57%, of outstanding common stock.

HP.com is a direct marketing and promotions company which designs and implements
creative client solutions on the Internet. HP.com uses pre-packaged and
customized initiatives to enable clients to drive traffic, enhance branding and
sell product. The company uses online and in-store sweepstakes promotions and
original Hollywood content to attract and target visitors who register to take
part in current and future promotions. HP.com obtains revenues from many sources
including sweepstakes sponsorship, Website sponsorship and directly marketing
goods and services to registered members who have granted their permission. In
addition, HP.com will continue to develop licensed snack foods that will be
distributed through Visionary Brands under contractual distribution agreements
between the two companies. Visitors can enter sweepstakes and view current
promotions at www.hollywoodpartners.com. HP.com uses Visionary Brands'
              -------------------------
facilities for manufacturing and distribution of certain products and pays it
fees.

With the spin out of Hollywood Partners.com and the transition to Visionary
Brands as the grocery food and marketing company, Vitafort is now positioned to
announce its new strategic direction. Upon shareholder approval, Vitafort
International Corporation will change its name to Visionary Holdings, Inc. to
reflect its transformation into a holding company. This new entity currently
owns 100% of Visionary Brands and 57% of Hollywood Partners.com. Management is
also involved in discussions with additional entities that could potentially
fall under the umbrella of Visionary Holdings.

The Company's wholly owned subsidiary, Global International Sourcing, Inc.
("Global") continues to source products in Mexico and throughout the United
States for both Visionary Brands and HP.com. During 1999, Global successfully
sourced the manufacturing and product development of the Gravity Bar and looks
to develop additional products in the next year.



VISIONARY BRANDS
----------------

MANUFACTURING & WAREHOUSING

The Company manufacturers its products by entering into agreements ("Co-Packer
Agreements") with established food manufacturers ("co-packers"), who have the
facilities, staff, quality assurance and process control programs for the
production of their own products, as well as the Company's products.  Co-packer
relations are intended to enable the Company to secure the expertise of
qualified food manufacturers with respect to the development, manufacture and
packaging of the product.  This arrangement is intended to achieve economies of
scale in production and staffing requirements, while providing production
flexibility to meet changes in product mix demanded by customers that the
Company could not achieve on its own.  Additionally, the Company benefits from
the production experience and expertise of these companies while avoiding the
capital outlays, staffing requirements, quality control, legal process
requirements and other manufacturing costs and delays that the Company would
encounter were it to attempt to manufacture its products utilizing its own
facility.  However, there can be no assurance that co-packers will meet their
obligations and the Company has been materially affected in the past by problems
with its co-packers.

The Company has worked diligently to establish strong manufacturing
relationships for its products.  The most significant development in this
initiative is the sourcing of product from Mexico.  Global International
Sourcing, the product procurement arm of Vitafort, has established manufacturing
relationships in Mexico to supply Hollywood Partners.com with all of the
confection products for "The Wizard of Oz" brand.

In 1998, the Company changed its primary public warehouse location from Laredo,
TX to Quincy, IL.  This change was implemented to reduce outbound trucking costs
by consolidating the shipment of the Company's two primary brands: "Peanut
Squeeze", produced in Chicago and "The Wizard of Oz" marshmallows, produced in
Mexico.  This central location will lower these costs by reducing the outbound

                                       3
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trucking mileage and increasing critical mass of Visionary Brands' products,
thereby capturing transportation synergies and reducing costs.

The Gravity Bar was developed by one of the leading product developers in the
energy bar industry. The product is currently being manufactured in Northern
California and is warehoused at the Company's warehousing facilities in Southern
California.

DISTRIBUTION AGREEMENT

In October 1999, the Company entered into a Distribution Agreement ("Agreement")
with Hollywood Partners.com that allows Visionary Brands to continue to
distribute HP.com licensed products to retailers across the country.  "The
Wizard of Oz" brand confection snacks are currently distributed in thousands of
stores through Visionary Brands.  The "Gravity Bar," the most recently licensed
product from HP.com, has been added to the products being distributed through
this Agreement and the Visionary Brands sales reps are currently presenting the
product to retailers and distributors throughout the country.

THE RETAIL TRADE

The Company's retail distribution strategy is to target the following classes of
trade: Supermarkets, mass merchandisers, drug stores, warehouse clubs,
convenience stores, natural food stores, military commissaries and exchanges,
and now sporting goods, health clubs, coffee houses and gourmet distributors.
Due to the consolidation in the industry, it is extremely important to maintain
strong relationships with the leading retailers.   Over the past year, the sales
team has gained new distribution for both "Peanut Squeeze" and "The Wizard of
Oz" marshmallows to thousands of grocery stores across the country.  These
products are currently being sold at leading chains such as:  Bi-Lo (Ahold,
Inc), Albertsons (CA, FL& TX), Atlantic & Pacific Tea Co. (A&P New Orleans),
Food Lion, Wakefern (Shop-Rite), Winn Dixie (New Orleans), Albertsons
(OR)(TX)(FL), Randalls/Tom Thumb, Vons and Safeway Denver (all Safeway
divisions), Ingles & Lowes (NC), Winn Dixie (Tampa), Grand Union (NJ) and other
leading retailers.

MARKETING

The Company also launched "Peanut Squeeze," the first product in the peanut
butter category that can be dispensed from a squeezable bottle. The initial
product launch placed the product in over 5,000 stores. Market acceptance during
this introductory phase is critical to market success. The market introduction
was negatively impacted by defective product. "The Wizard of Oz" line of
Marshmallows continues to be marketed as a value added brand in the 125 million
dollar marshmallow category; however, the Company has added a vanilla flavored
white marshmallow to strengthen the brand. The Company will continue to market
its "Toast `N Jammers" to Natural Foods stores across the country. The good
tasting, good-for-you section of the grocery store is becoming a high growth
emerging segment.

Visionary Brands competitively exists in mainstream grocery retail, but now has
a focus on several different classes of trade.  This diversified approach allows
for balance of synergies and profits.

INTELLECTUAL PROPERTY RIGHTS PROTECTION AND TRADEMARKS

The Company believes that its trademarks do afford it some degree of protection
from competition and do allow it to differentiate its products from those of its
competitors through brand loyalty and identity.  There are, however, no
assurances that such trademarks may offer significant protection from
competitors or that the Company would be successful should litigation to protect
such trademarks become necessary.  The Company relies upon non-disclosure,
secrecy agreements and its common law rights in order to protect its proprietary
formulae, procedures, and other information.  No assurance can be given that
such steps will adequately protect the Company against competing products or
that the Company will be able to adequately enforce its

                                       4
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rights against third parties who may be utilizing the Company's proprietary
formulae, procedures and other information. If the Company is advised by counsel
that any of its formulae, processes, procedures or other techniques are
patentable, then it may seek appropriate patent protection.

The Company has co-developed several proprietary formulations for its products.
While these formulations may or may not be protected under the U.S. Patent laws,
they may have value inasmuch as they provide Visionary Brands with its unique
competitive edge.  The table below highlights each of the Company's active
trademarks.


TRADEMARKS                            DESCRIPTION AND STATUS

Vitafort               This is an active trademark currently being used on all
                       Company material; however, the Company is in the process
                       of setting up all industry communications through
                       Visionary Brands.

Visionary Brands       The name of the wholly owned subsidiary that is currently
                       marketing all products for the Company.

Peanut Squeeze         Brand is in current distribution in thousands of
                       supermarket peanut butter sections across the country.

Auburn Farms           Trade name acquired in May 1996 with existing presence in
                       the natural foods class of trade. Brand is being utilized
                       on a very limited basis in natural foods.

Natures Warehouse      Trade name acquired in May 1996 with existing presence in
                       the natural food class of trade. Brand is being utilized
                       on a very limited basis in natural foods.

Toast `N Jammers       A repositioned brand name with specialty grocery and
                       natural food presence.

Jammers                One of the all-natural fat free cookie brands in natural
                       food class of trade. Brand is being utilized on a very
                       limited basis in natural foods.

Juliette's Private     Trade name used for both low fat cookies and low fat
Collection             chocolate truffles.


GOVERNMENTAL REGULATION

     In general, production, packaging, processing and labeling of food and
beverage products are subject to various federal and state regulations.  The
Company relies upon the experience and expertise of its co-packers to assure
compliance with applicable federal and state regulations.  The Company believes
that it is in compliance with all applicable governmental regulations.

RESEARCH AND DEVELOPMENT

     The Company has modified its research and development strategies from prior
years.  In the past, the Company retained highly trained technical support
professionals to independently develop formulations and work with contract
manufacturers to bring the products to market readiness.  The strategy moving
forward in 1999 and beyond is to work with manufacturers from the outset and
utilize their internal research and technical staff to develop new products.

                                       5
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COMPETITION

     The Company is engaged in the highly competitive grocery food marketplace.
There are numerous companies with financial and business resources far greater
than Vitafort's who are currently marketing competitive products.  The Company
seeks to compete based on the unique taste, texture and quality of its products
and by obtaining recognition for its trademarks and licenses.

     The Company's brands compete within different categories and with different
products depending upon the class of trade and placement within retail outlets.
The chart below details the Company's product lines and identifies the
competitors within the classes of trade.


<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------
    VITAFORT BRAND           CLASS OF TRADE         PRINCIPAL COMPETITION             MARKET NICHE
-----------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------
<S>                      <C>                      <C>                        <C>
Juliette's Private       Grocery stores,          There is no known direct   Appeal to those consumers who
  Collection             mass merchandise, drug   competition for boxed      are not willing to sacrifice
Chocolate Truffles       and gourmet industries   low fat chocolate cream    the taste of real chocolates,
                                                  candies.                   but demand a nutritional
                                                                             profile that provides lower
                                                                             fat than traditional
                                                                             chocolates.
-----------------------------------------------------------------------------------------------------------
Juliette's Private       Natural foods and        Westbrae,                  Appeal to consumers who want
   Collection            grocery stores.          Pepperidge Farms,          a premium cookie with great
Super Premium Cookies                             Barbara's,                 taste and just the right
                                                  Pamela's                   amount of fat to ensure great
                                                                             taste.
-----------------------------------------------------------------------------------------------------------
Toast `N Jammers Low     Natural food stores,     Health Valley Healthy      Toast `N Jammers has a
Fat Toaster Pastries     grocery stores and       Tarts, and Natures'        competitive edge in taste and
                         club stores.             Choice Toaster Pastries    all natural ingredients that
                                                                             consumers are responding to.
-----------------------------------------------------------------------------------------------------------
Gravity Bar              Mass merchandisers,      Power Bar, Balance Bar&    A great tasting bar offering
                         grocery stores, drug     Cliff Bar are the major    the attributes of energy
                         stores mom & pop         competitors                enhancement and no after
                         stores and club stores.                             taste.
-----------------------------------------------------------------------------------------------------------
Peanut Squeeze           Mass merchandisers,      Skippy, Jif & Peter Pan    The only squeezable product
                         grocery stores, drug                                in the peanut butter section
                         stores mom & pop                                    of the grocery stores.
                         stores and club stores.
-----------------------------------------------------------------------------------------------------------
The Wizard of Oz         Grocery, mass            None flavored              Flavored marshmallow snack to
Marshmallows             merchants, club and      Favorite Brands            be used as an ingredient or
                         discount drug stores     International Home Foods   everyday snack.
-----------------------------------------------------------------------------------------------------------
</TABLE>

ENVIRONMENTAL REGULATION AND SEASONALITY

     Management believes that the costs associated with compliance with
environmental regulations do not at this time impose a significant burden upon
the Company's operations.  Any change in that burden, however, could adversely
impact the Company.  Management does not believe that the Company's business is
seasonal to any significant extent.

                                       6
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EMPLOYEES

     As of April 12, 2000, the Company had 9 employees of whom 3 were executive
officers, 1 was engaged in sales and marketing, and 5 were clerical and
administrative.

HOLLYWOOD PARTNERS.COM
----------------------

In late September 1999, HP.com launched its initial Website at

www.hollywoodpartners.com.  This Website has been used to post and manage a
-------------------------
number of sweepstakes contests for the benefit of various customers and
partners, coming from industries such as food manufacturing, entertainment,
publishing, sporting goods and concert promotion.  In the second quarter of
2000, HP.com will re-launch its Internet offerings with two new Websites under a
Hollywood Partners.com brand umbrella:

     PlanetFree.com - a new sweepstakes Website replacing current sweepstakes
     --------------
     functions of the current Hollywood Partners.com Website that will initially
     host up to 20 sweepstakes at one time.  This Website is designed to host
     sweepstakes and promotions for retailers and manufacturers who HP.com
     believes are seeking a higher level of branding and capability to educate
     than generally offered on other sweepstakes Websites.

     BigTimeHollywood.com - a new e-magazine offering original content plus
     --------------------
     news, games and reference information about the entertainment industry,
     primarily focused toward movies and television. The features and other
     information provided on this Website are aimed to both entertain and inform
     the visitor about the entertainment industry, how it works and why.

As part of the mission, HP.com will strive to be a socially responsible company.
In the normal course of business, HP.com will attempt to integrate environmental
organizations and charitable causes into the content.  For example,
PlanetFree.com will contain links to environmental organizations and many of the
sweepstakes are expected to have tie-ins to charities.

HP.com intends to use the Hollywood Partners.com brand as an "umbrella" to
build, partner or acquire additional complementary Websites that offer unique
content for its visitors.  As this group of associated Websites builds, HP.Com
plans to increase the relationship it has with its visitors, which should
increase its ability to effectively conduct direct marketing activities with
them.

Revenues to date have been minimal for HP.com's new business model.  To date,
HP.com has used its Website as a demonstration to prove the capabilities to
successfully conduct sweepstakes promotions, to collect registration information
from its visitors and to refer visitors to information or e-commerce
opportunities.  The companies that have worked with or who have committed to
working with HP.com in the next twelve months as sweepstakes licensors,
sweepstakes or product sponsors include Rite-Aid, Johnson & Johnson, eMap
Publishing, Warner Bros., Jam Productions, GiftCertificates.com(TM), S3 and
Vitafort International Corporation, an affiliated company.

PROPOSED HP.COM OPERATIONS

Hollywood Partners.com is building a family of Websites offering content,
community and commerce.  Its second quarter 2000 launch of PlanetFree.com and
BigTimeHollywood.com will be the first Internet Website offerings of many HP.com
plans to offer to its visitors under a broad entertainment theme.

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Management believes that visitors and registered users, who are called
"Members," will benefit from the opportunity to access a group of related
Websites where they may receive unique experiences, including:

     .  Winning prizes through sweepstakes promotions or contests
     .  Finding original content about the entertainment industry
     .  Customizing a list of preferences for offers that may be sent to them
        according to the permission granted by the Member

There is no charge to view information on HP.com's Websites. Registration is
required for certain privileges such as entry into sweepstakes on the
PlanetFree.com Website or posting bulletin board messages on the
BigTimeHollywood.com Website.

HP.com plans to implement a common registration system for PlanetFree.com and
BigTimeHollywood.com. A Website visitor who registers as a Member of one Website
will automatically become a Member of the other Website, and receive Member
benefits from the other Website. As additional Websites are added under the
Hollywood Partners.com brand, it intends to extend this registration system to
include the new Websites. HP.com believes a universal registration system will
increase the ease of use for its Members across its Websites and increases its
overall traffic for its family of Websites.

HP.com is a "permission" marketer - Members do not receive any announcements or
offers unless they have given their permission.  HP.com maintains a strict
privacy policy which provides that all personal information provided to the
company remains confidential unless it is authorized to provide it to a third
party.

Management believes that marketers may benefit from using HP.com's
"permissioned" access to its registered Members to acquire customers more
efficiently than through other means of direct marketing.  Since many of its
registered Members have provided information regarding their interests and
demographic profile, marketers can target subgroups of HP.com's registered users
where they believe they will have the highest rates of success.  Further, HP.com
is able to offer fee structures to marketers for access to its Members based
upon the results achieved for the marketer, thereby minimizing the risk to use
the service.  These potential benefits to marketers will only be realized if the
company develops a large database of registered Members who have given the
company permission to bring them offers from third parties.

PROPOSED SWEEPSTAKES ACTIVITIES

HP.com's PlanetFree.com Website is planned to have neither banner ads nor any
other form of advertisement other than display of its brands.  On
PlanetFree.com, the company provides pages dedicated only to providing the
information a sponsor desires the Website visitor to view without the typical
distracting clutter of banners, buttons and other offerings typically found on a
sweepstakes Website.  Management believes the value and effectiveness of a
sponsor's offering is greatly increased without these distractions.

HP.com also provides the capability to manage a sweepstakes for a client both on
the Internet and in stores, broadening the traditional method of conducting
sweepstakes in stores.  HP.com believes many clients are more willing to move
into the Internet sweepstakes promotion as an extension of their prior
experience with the in-store model.

Marketers may also choose to serve as a sponsor or advertiser on HP.com's
BigTimeHollywood.com Website.  The visitors to this Website are pre-qualified to
the extent that they have already demonstrated their interest in the
entertainment industry, enhancing the likelihood they will purchase
entertainment-related products and services.

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Hollywood Partners.com was launched as a sweepstakes Website on September 30,
1999.   The intent for this initial Website was to demonstrate various
sweepstakes methodologies, registration systems and various methods of
conducting these promotions.  Examples of sweepstakes conducted included:

     The Wizard of Oz(TM) - Presented under license from Warner Bros., this
     sweepstakes offered a tie-in e-commerce opportunity to Gift
     Certificates.com allowing visitors to this contest to "surf off" to a co-
     branded page where they received a discount offer good at over 100
     retailers.

     Gravity Games(TM) - Presented under license from eMap USA, this sweepstakes
     offered prizes and offers for free magazine subscriptions.

     Newsboys Concert Tour - This sweepstakes, launched in February 2000, offers
     the ability to enter for VIP tickets to over 60 separate concert dates.

Visitors must register as Members to win prizes.  HP.com's registration process
will have a mandatory information section, an optional information section and
"opt-in" questions regarding the Member's permission to send additional
information.  The mandatory information will include basic information required
to send prizes to Members, including name, address, email address and age.  The
optional information includes information such as music and movie genres
preferred, categories of interest for further offers, preferred grocery shopping
location, income level, level of education and size of household.  "Opt-in"
questions determine the desire of the Member to have us send additional
information about new sweepstakes or new features and special offers on the
Website.  Once consumers register by providing at least the required demographic
information, they become lifetime Members and can enter additional sweepstakes
without having to resubmit this information.

HP.com sweepstakes run continuously, typically providing consumers with the
opportunity to enter each day to win.  Sweepstakes typically run from 30-90
days, and may range from a single winner to hundreds of winners or more.  To
date, the company has managed fulfillment to winners either in-house or through
prize sponsors who send the prizes directly to the winners.

HP.com offers a full range of sweepstakes management services for its
PlanetFree.com sweepstakes sponsors to manage the technology and creative
processes for both online and for in-store promotions.  Its services include:

  .  Advisory services regarding concept development and promotion strategy
  .  Prize selection and acquisition
  .  Design of the online sweepstakes
  .  Design of point of purchase materials for in-store displays
  .  Delivery of announcements to "permissioned" Members
  .  Management of systems to collect on-line sweepstakes entries
  .  Management of processes to collect in-store or other offline entries, if
     included
  .  Selection of sweepstakes winners
  .  Confirmation of eligibility of sweepstakes winners
  .  Prize fulfillment to confirmed winners

As its registered user database grows, HP.com plans to add significant
capabilities so as to market opportunities to companies that desire to market to
the Members in its permissioned database.    HP.com will allow business to
determine the specific base of users they desire to target with an offer.  For
example, a business could specifically address all persons who have already
expressed an interest in "Rock and Roll" music who are between ages 18 and 29.

                                       9
<PAGE>

Basic operations of PlanetFree.com will remain similar to the prior sweepstakes
Website hosted as HollywoodPartners.com.  The company intends, however, to
increase significantly the quality of design, the number, the depth and the
breadth of its sweepstakes.  The HollywoodPartners.com Website becomes an entry
point though which a visitor may access all of the Websites under the Hollywood
Partners.com brand.

E-MAGAZINE ACTIVITIES

Also during the second quarter, HP.com will launch BigTime, its entertainment-
themed e-magazine at www.BigTimeHollywood.com.  This Website will contain
                     ------------------------
entertainment-themed features, news, statistics, games and other information.
The features will substantially be original content, focused on the workings of
Hollywood from "behind the scenes" and first person stories of Hollywood
experiences.   Visitors will be able to read all information on the Website for
free, but they will be required to register as Members if they desire to post
information on bulletin boards, enter chat sessions, or participate in other
activities to be designated.

STRATEGY

HP.com's goal is to become a preeminent entertainment-themed family of Websites
on the Internet, using its Hollywood-oriented entertainment theme to combine
content, community and commerce attributes to create an attractive destination
for visitors.  HP.com believes the combination of content and sweepstakes
promotions, combined with its Website promotion activities, will generate high
interest from Internet users.  Through this family of Websites, the company
intends to develop and offer content and services across these Websites and to
cross-market the Websites to the visitors.

For example, a sweepstakes offering a set of Hollywood-oriented prizes on
PlanetFree.com may be of interest to a visitor on the BigTimeHollywood.com
Website, and that visitor may then register as a Member and begin to enter other
contests on the PlanetFree.com Website. As many of these users become registered
Members and receive more benefits from the Hollywood Partners.com branded
Websites, Management believes it will be able to form a relationship whereby its
Members will be more receptive to purchase from a Hollywood Partners.com branded
Website or a third party marketer who is associated with Hollywood Partners.com.

HP.com's plan is designed to develop multiple sources of revenue for the Company
in a phased approach. It believes that these revenues will develop substantially
from both "brick and mortar" and Internet companies, providing a broad base of
opportunities and lessening dependence on any single category source of revenue.
The company anticipates revenues from the following categories:

   .  Sweepstakes promotion sponsorship revenues from companies seeking to
      enhance their Internet branding or to generate leads for e-commerce
      offerings - a significant component of this revenue is anticipated to
      originate from "brick and mortar" companies

   .  Sponsorships and advertising of our e-magazine, including sales of various
      forms of banner, button and text link advertising

   .  Direct marketing revenues from direct or referred opportunities to Members

   .  E-commerce opportunities offered directly from a store or other area on
      one or more of the company's Websites

Revenues in the first two quarters of year 2000 are anticipated to be minimal.
They are anticipated to come primarily from the first two categories of revenue
above. Revenues for the last two categories are anticipated to develop to a
significant level during the following years. However, there is no guarantee
that any of these categories will develop significant revenue for the company
during the Year 2000 or beyond.

                                       10
<PAGE>

HP.com also anticipates receiving a small amount of revenue from the sale of
licensed food products.  The company currently has products in distribution
through a majority owner from its licensing business, including The Wizard of Oz
marshmallow products under license from Warner Bros. and the Gravity Games
Energy Bar under license from eMap USA. The company earns royalties from these
products but it does not engage in any manufacturing or distribution activities,
nor does it carry any inventories.

MARKETING

HP.com's marketing efforts are directed to both Website visitors and potential
promotion sponsors.

HP.com intends to implement a number of measures to drive additional visitors to
its Websites and to increase the time spent on its Websites by each visitor.  To
attract new visitors, the company will use online and traditional advertising
programs, by purchasing access to Members of complementary Websites, through
"viral" marketing such as allowing a user to "send a story to a friend" and
other methods.

To encourage repeat visitation, HP.com sends emails to Members who have given
their permission for the company to send updates to them of new contests,
features and opportunities.

HP.com has also tied in its Hollywood Partners.com brand in a number of
promotions that have been intended to maximize impressions at a minimum of cost.
The company has designed and implemented promotions such as inclusion of its Web
address on a Warner Bros. recent release of The Wizard of Oz video to direct
purchasers of the video to the Hollywood Partners.com Website.  HP.com is
planning promotions that include in-store campaigns in addition to the Internet
sweepstakes.  These sweepstakes have the capability to place HP.com's brand in
front of millions of people in thousands of stores.

HP.com has implemented a sales program to national and regional retailers and
manufacturers, and intends to add significantly to its sales force.   In
addition, further sponsorship opportunities will be available for advertising on
its BigTimeHollywood.com Website, which it believes will be appealing to
companies seeking branding or referrals from an entertainment-related Website.

HP.com believes it is critical to keep improving and expanding its offerings in
order to retain its current traffic and to attract new visitors.  For example,
after the launch of PlanetFree.com, it intends to improve the number of
sweepstakes and the dollar value of the prizes offered.  After the launch of
BigTimeHollywood.com, it intends to expand the content offered and continuously
research and focus to the areas of greatest interest to its Members.

HP.com also intends to increase the depth and the breadth of its offerings
through the addition of Websites consistent with its brand and visitor
strategies.  These additions may be made through the company's decision to build
an additional Website and provide the content from internal resources, through a
strategic partnership to bring the content of another Website under the
Hollywood Partners.com brand, or through an acquisition of an existing Website.

SALES

HP.com sells its sweepstakes services through direct sales, managed by its own
employees and in conjunction with consultants retained to extend its range of
contacts.  The company typically targets its sales efforts at senior marketing
executives within a major retailer or manufacturer.  In a typical sales process,
the company will spend time learning the needs of the potential client to
determine their relative needs in areas such as branding, target demographics,
and customer acquisition.  HP.com then presents and proposes sweepstakes
promotions to them according to their preferences.

                                       11
<PAGE>

Customer service after the sale is a critical factor in HP.com's long-term
success.  For each promotion, a customer service manager is assigned to ensure
that daily activities are conducted to client expectations, and to resolve any
issues that arise.

TECHNOLOGY AND OPERATIONS

HP.com currently outsources its Website design, computer programming efforts and
hosting requirements.  The company has primarily used two design and programming
companies as contractors.  To date, HP.com believes the quality and timeliness
of these services has been satisfactory.

For its initial HollywoodPartners.com sweepstakes Website, the company used
shared services hosted at a third party service provider located in Los Angeles,
California. For the period of demonstration that is now coming to an end, this
was sufficient for its requirements. With the launch of its new Websites,
PlanetFree.com and BigTimeHollywood.com, the Company is moving to a standalone
server solution and moving our hosting to a third party service provider based
in San Jose, California. The facility has uninterruptible power supplies and
other systems designed to provide power to the systems within seconds of a power
outage.

Research and development expenditures during 1999 were minimal.  The company
plans to increase its research and development expenditures to build its in-
house technology staff, to expand its service capacity and to increase its
capabilities to offer additional services to its sponsors and Members.

COMPETITION

The Internet marketing services and entertainment-themed content businesses are
highly fragmented.  A large number of companies provide services or products to
the market for both sweepstakes promotions and entertainment-themed content, and
the competition is intense.  Many of these competitors have substantially
greater financial resources.  There are also minimal barriers to entry for new
entrants in either of these areas.

HP.com also competes with offline promotion companies, large Internet
publishers, search engine and other portal companies, a variety of Internet
advertising networks and other companies that facilitate the marketing of
products and services and the provision of content on the Internet.

Current competitors include:

     .   Sweepstakes and game Websites such as Promotions.com, iwin.com and
         iwon.com.

     .   Direct marketing, specialty lead generation and loyalty Websites such
         as Freeshop.com, Yesmail.com, Exactis.com, Mypoints.com,
         Netcentives.com, Netcreations.com, Engage Technologies, Inc. and
         Cybergold.com.

     .  Content Websites such as portals with entertainment themed sections such
        as Yahoo! Entertainment, entertainment content Websites such as
        Hollywood.com, Entertaindom.com, and Websites offered by the major
        Hollywood studios such as Warnerbros.com.

INTELLECTUAL PROPERTY

HP.com protects its technology and proprietary rights through a combination of
copyright, trade secret and trademark law.  HP.com has filed for a number of
trademarks and service marks, including pending

                                       12
<PAGE>

registrations for the Hollywood Partners, PlanetFree, BigTime and BigTime
Hollywood trademarks in the United States. The company's trademark registration
applications may not be approved.

HP.com generally enters into confidentiality or license agreements with its
employees, consultants and corporate partners, and generally control access to
and distribution of its technologies, documentation and other proprietary
information.  Despite efforts to protect its proprietary rights from
unauthorized use or disclosure, parties may attempt to disclose, obtain or use
HP.com's proprietary rights.  HP.com cannot be certain that the steps it has
taken will prevent misappropriation of its proprietary rights, particularly in
foreign countries where the laws or law enforcement may not protect its
proprietary rights as fully as in the United States.

HP.com's technology collects and utilizes data derived from user activity on the
HollywoodPartners.com Website, and it expects to continue to use this and
successor versions of its technology to collect similar information from the
company's future Websites. Although HP.com believes that it has the right to
compile and use this data, there can be no assurance that any trade secret,
copyright or other protection will be available for this information.  In
addition, others may claim rights to this information, the technology that the
company uses to collect this information, or the technology it uses to use this
information to create offerings for its clients.


ITEM 2.   DESCRIPTION OF PROPERTY

     The Company's principal executive office consists of a portion of 4,759
rentable square feet located at 1800 Avenue of the Stars, Los Angeles,
California, which the Company subleases from Hollywood Partners.com, Inc. under
a two year lease at a rate of $4,753 per month.  The Company believes its
current facilities are suitable for its needs.

ITEM 3.   LEGAL PROCEEDINGS

     The Company is not party to any material legal proceedings.


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

     No matters were submitted to a vote of shareholders during the fourth
quarter of 1999.

                                       13
<PAGE>

                                    PART II

ITEM 5.   MARKET FOR THE COMPANY'S COMMON EQUITY
          AND RELATED STOCKHOLDER MATTERS

The table below sets forth the high and low closing bid prices for the common
stock, redeemable warrants and units during the period January 1, 1998 to March
31, 2000, as reported on the Electronic Bulletin Board. The Company's redeemable
warrants expired on October 31, 1998 and there were no quotations for the
warrants or units after such date. The quotations represent inter-dealer
quotations without adjustment for retail mark-ups, mark-downs or commissions and
may not represent actual transactions:

Period                  Common Stock          Warrants          Units
                      High        Low       High     Low    High      Low

1/st/ Quarter 1998    $1.468   $0.687      $  0.010    *    $0.500   $0.500

2/nd/ Quarter 1998    $1.437   $0.828      $  0.010    *    $0.500   $0.500

3/rd/ Quarter 1998    $1.000   $0.250      $  0.010    *    $0.500   $0.500

4/th/ Quarter 1998    $0.250   $0.080      $0.000**    *        **       **

1/st/ Quarter 1999    $ 0.90   $ 0.34      $0.000**    *        **       **

2/nd/ Quarter 1999    $ 0.53   $ 0.33      $0.000**    *        **       **

3/rd/ Quarter 1999    $ 0.59   $ 0.33      $0.000**    *        **       **

4/th/ Quarter 1999    $ 0.82   $ 0.25      $0.000**    *        **       **

1/st/ Quarter 2000    $ 0.77   $ 0.31      $0.000**    *        **       **

*       Less than $ 0.010

**    The Company's redeemable warrants expired on October 31, 1998 and there
were no quotations for the warrants after such date.  There were no quotations
for the units in the fourth quarter of 1998.

The above amounts have been retroactively adjusted for a 1 for 20 reverse stock
split, which occurred on October 4, 1996.

        On April 11, 2000, the closing bid price for the common stock, as
reported by the Over The Counter Electronic Bulletin Board, was $0.33.

        At the close of business on April 11, 2000, there were approximately 513
holders of record of the common stock.

        The Company has not paid any dividends on the common stock since
inception and intends to retain any future earnings for the development of its
business. Future dividends on the common stock, if any, will be dependent upon
the Company's earnings, financial condition, the dividend priority of any
preferred shares and other relevant factors as determined by its Board of
Directors.

                                       14
<PAGE>

     No dividends were paid on Series B Convertible Preferred Stock during 1998
or 1999. Cumulative unpaid dividends on the Series B Convertible Preferred Stock
as of December 31, 1999 totaled $42,500. All unpaid dividends on the preferred
stock must be paid before dividends can be paid on the Common Stock.

                                       15


<PAGE>

ITEM 6.   MANAGEMENT'S DISCUSSION & ANALYSIS OF FINANCIAL
                      CONDITION AND RESULTS OF OPERATIONS

 Cautionary Statement for Purposes of "Safe Harbor Provisions" of the Private
                   Securities Litigation Reform Act of 1995.

Certain statements contained in this Annual Report on Securities and Exchange
Commission ("SEC") Form 10-KSB ("Form 10-KSB") constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements involve known and unknown risks, uncertainties and
other factors that may cause our or our industry's actual results, levels of
activity, performance or achievements to be materially different than any
expressed or implied by these forward-looking statements. These statements may
be contained in our filings with the Securities and Exchange Commission, press
releases, and written or oral presentations made by our representatives to
analysts, rating agencies, stockholders, news organizations and others. In some
cases, you can identify forward-looking statements by terminology such as "may,"
"will," "should," "intend", "expects," "plans," "anticipates," "believes,"
"estimates," "predicts," "potential," "continue," or the negative of these terms
or other comparable terminology. Although we believe that the expectations in
the forward-looking statements are reasonable, we cannot guarantee future
results, levels of activity, performance or achievements.

YEARS ENDED DECEMBER 31, 1999 AND 1998
--------------------------------------

RESULTS OF OPERATIONS

     The past year has been a year of transition for the Company. Vitafort has
created its new food marketing entity, Visionary Brands, which continues to
focus on the marketing and distributing of new innovative foods to the grocery
industry. In addition, management has spent considerable energy on the spin out
of its wholly owned subsidiary, Hollywood Partners, Inc. Upon completion of this
transaction in September, the name of the entity was changed to Hollywood
Partners.com, Inc. and new management was recruited to execute the direct
marketing Internet business model (See Item 1: Description of Business -
Hollywood Partners.com).

     Visionary Brands introduced two new products in 1999. The initial product
launched was "Peanut Squeeze," the first product in the peanut butter category
that can be dispensed from a squeezable bottle. This innovative snack was seen
by over 6 million viewers in a 48-hour span after the product was introduced at
the Food Marketing Institute Convention in Chicago in May. Since this initial
media exposure, the product has been placed in over 5,000 stores across the
country.

     In conjunction with Hollywood Partners.com, Visionary Brands introduced its
latest product, "Gravity Games Energy Bar." This snack was unveiled at the
Gravity Winter Games held at Mammoth Mountain, California in January 2000. The
Gravity Games is a joint venture between NBC Sports Ventures, the business unit
of NBC Sports, and eMap Petersen, Inc., the largest special interest publisher
in the United States with more than 160 publications.

     Visionary Brands began distribution of the Gravity Bar in February 2000.
This new entry into the Energy Bar nutritional category is targeted to the
younger consumer (12-24 years of age) and the license with the Gravity Games
that also targets similar demographics. Gravity Bars come in two flavors,
Chocolate Peanut and Chocolate Fudge, both with Ginseng, 12 grams of protein and
35% R.D.A. of certain vitamins.

     Management believes that the manufacturing and product development aspects
of the Company have been improved over the past year with the relationships
established in Mexico and in the United States. These manufacturers have
provided the Company with a promising product mix with improved margins. The

                                       16
<PAGE>

Company will continue to seek to source additional suppliers and products from
around the world in the upcoming year in its efforts to increase quality, lower
costs and increase revenue.

NET SALES

     In 1999 the net sales of the Company were $2,451,531 compared to $2,861,392
in 1998.  This decrease of $409,861 or 14.3% was primarily due to lower sales of
The Wizard of Oz marshmallows due to delays in shipping our newly developed "The
Wizard of Oz" marshmallow packaging that was shipped in the second quarter of
1999.  In addition, the Company did not enjoy the strong fourth quarter revenue
it received in 1998 tied to the re-release of the motion picture "The Wizard of
Oz," and the shipment of collectors' tins to Wal-Mart.

     In 1999, Peanut Squeeze sales were $661,603, or 27.0% of sales, and The
Wizard of Oz marshmallow sales were $1,019,156, or 41.6% of sales.  In 1998, the
Wizard of Oz marshmallows represented $1,739,559, or 60.8% of sales.

GROSS PROFIT

     Gross profit in 1999 was $539,855 or 22% of sales, compared to a gross
profit of $985,073 in 1998 or 34.4% of sales.  This decrease of $445,218 was due
to two significant factors. The first factor being the reduced sales levels of
the "The Wizard of Oz" brand products, which have a high profit margin and
second being the start-up production costs of  "Peanut Squeeze".

OPERATING EXPENSES

Research and Development

     In 1999, product development expenses were $104,615 compared to $362,770 in
1998, a decrease of $258,155, or 71.2%.  The reduction was primarily due to the
Company's decision to curtail expenses in 1999 by closing its research and
development department and utilize the research and development capacity of its
manufacturers.

Sales and Marketing

     Sales and marketing expenses were $2,152,665 in 1999 as compared to
$2,035,125 in 1998.  The increase of  $117,540 was primarily due to promotional
expenses related to the introduction of the "Peanut Squeeze" line of products in
1999.

General and Administrative

     General and Administrative costs in 1999 were $2,576,844, compared to costs
in 1998 of $2,557,890. This $18,954 or 1% increase is primarily due to the
decision to change the strategy of the Company, the associated costs to support
the separation of the Company and to hire additional personnel.

INCOME TAXES

     As of December 31, 1999, the Company had unused Federal and California net
operating loss carryforwards of approximately  $24,932,000 and $11,732,000,
respectively, available to offset future Federal taxable income and future
California taxable income. The unused net operating loss and credit
carryforwards expire in various amounts through the year 2019.  In contrast to
Federal net operating losses, only 50% of the California net operating losses
incurred subsequent to December 31, 1986 may be carried forward.  The California
net operating losses will expire in various amounts through the year 2004.

                                       17
<PAGE>

     Net deferred tax assets of approximately $8,829,000 resulting from net
operating losses have been offset by a valuation allowance since management
cannot determine whether it is more likely than not such assets will be
realized.

     Due to restrictions imposed by the Internal Revenue Code regarding
substantial changes in ownership of companies with loss carryforwards, the
utilization of the above-mentioned net operating losses may be limited as a
result of changes in stock ownership.  The annual utilization of these losses is
limited to an amount equal to the estimated fair value (for income tax purposes)
of the Company at the point of stock ownership change, multiplied by the long-
term tax-exempt rate then in effect.  The annual limitation has not been
quantified at this time.

OTHER INCOME AND EXPENSE

     Interest expense was $366,609 in 1999 compared to $221,547 in 1998. The
increase of $145,062 or 65.5% relates to the cost of borrowings to fund the
operation.

     In August 1999, the Company entered into a litigation settlement with
Barbara's Bakery/New Life (Refer to Litigation Recovery, Net of Costs, Note 16).
The Company received $1,260,000 of net proceeds after paying attorneys and
outside investors who funded the litigation.

     During the year ended December 31, 1999, the Company renegotiated certain
accounts payable and notes payable resulting in a reduction of $242,359 of the
amount due. Additionally, the Company repaid certain notes payable through the
issuance of stock which had a fair market value of $143,250 less than the debt
extinguished. Therefore, the Company recognized a gain on extinguishments of
debt of $385,609.


LIQUIDITY AND CAPITAL RESOURCES                          December 31,
                                                      1999           1998
                                                  -------------  ------------

     Net Cash Used In Operations                  $(1,866,148)   $(3,569,962)
     Net Cash Used in Investing Activities           (470,076)      (282,164)
     Net Cash Provided By Financing Activities      2,551,728      2,556,739
     Working Capital (Deficit)                      1,406,258       (615,028)

     At December 31, 1999 the Company had cash of $1,119,153 as compared to
$903,649 in 1998. This increase is due primarily to additional investment
received by the Company as part of the spin off of its subsidiary Hollywood
Partners.com. Of the cash on hand, $1,086,585 was held by Hollywood
Partners.com.

     The Company is continuing to seek to improve its relationships with its
food brokers and customers (distributors), but the effort must be focused in
accelerating the sales process to the Company to a break-even position. Although
the vendor relationships are more stable, the Company may again jeopardize this
area should the liquidity problem continue.

     During March and April 2000, the Company entered into a series of
settlement agreements and releases with certain lenders to resolve all
outstanding issues between them. The agreements were effective as of December
31, 1999, whereunder the Company resolved its outstanding issues with certain
lenders by satisfying an aggregate of $1,510,560 of indebtedness, inclusive of
accrued interest, through the issuance of an aggregate of 377,640 shares of
restricted stock of its partially owned subsidiary, Hollywood Partners.com, Inc.
These transactions were recorded in the Company's consolidated financial
statements of December 31, 1999. See Note 6. Two of the lenders agreed to make
market purchases of an aggregate of 900,000 shares of the Company's common
stock, during the period ended May 31, 2000, but in no event more than a
combined  total purchase of $750,000. The agreements require the lenders not to
sell any of the shares until after they have purchased the entire amount of
shares as required pursuant to the terms of the agreements. The two lenders also
agreed not to sell, in any calendar month, more than 25% of the shares they
purchased. Notwithstanding this 25% restriction, the lenders are not precluded
from taking any action that would be necessary for them to meet their fiduciary
responsibilities owed to their investors and/or shareholders.

     The Company has suffered recurring losses from operations as of December
31, 1999. Although the Company received a cash settlement of $1,256,632 from the
Barbara's litigation (see Note 16 to the Consolidated Financial Statements), it
has not generated sufficient revenue-producing activity to sustain its
operations. The Company's independent certified public accountants have included
a modification to their opinion which indicates there is substantial doubt about
the Company's ability to continue as a going concern. See Note 2 to the
Consolidated Financial Statements for additional information. The Company is
attempting to raise additional capital to meet future working capital
requirements, but may not be able to do so. Should the Company not be able to
raise additional capital, it may have to severely curtail operations.

CREDIT FACILITY

     In June 1999, the Company paid off its previous line of credit, but the
assets are still collateralized.  As of December 31, 1999, the Company does not
have an institutional credit facility.

                                       18
<PAGE>


YEAR 2000

     The Company's accounting software currently does not utilize a four digit
year field; however, the Company has been assured by the software manufacturer
and independent consultants that all necessary modifications for the year 2000
were made and tested timely.  The Company was advised by a consultant that the
hardware was modified timely.  The cost of these modifications did not have a
significant effect on its financial position or results of operations.  The
Company currently does not interact electronically with either customers,
suppliers or other entities that could be impacted by Year 2000 issues.  The
Company has not experienced any Year 2000 issued through the date of this
report.  Should any of the Company's internal systems fail in the future, the
Company's business and results of operations could be adversely impacted.

ITEM 7.   FINANCIAL STATEMENTS

    SEE "INDEX TO CONSOLIDATED FINANCIAL STATEMENTS" BEGINNING ON PAGE F-1


ITEM 8.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
          ON ACCOUNTING AND FINANCIAL DISCLOSURE

     None.

                                       19
<PAGE>

ITEM 9:    DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
           PERSONS, COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

     The directors and executive officers of the Company are as follows:

           Name                     Age   Positions Held
           -----------------------  ---   --------------

           Mark Beychok             43    Chairman of the Board
           John Coppolino           39    President and a Director
           Benjamin Tabatchnick     47    Director
           Valerie A. Broadbent     61    Secretary
           Fred Rigaud              55    Acting CFO

     Mark Beychok was elected Chairman of the Board in December 1999.  Mr.
     ------------
Beychok served as President and Director of the Company from September of 1993,
until he resigned as President in December 1999. Mr. Beychok was also Chief
Executive Officer from 1995 until his resignation from that position in February
2000. Mr. Beychok was also elected as Chairman of the Board of Hollywood
Partners.com, Inc. in September 1999. Mr. Beychok is a private investor with
twenty years experience in the food industry as an owner and operator of various
food manufacturing, marketing and distribution companies. Mr. Beychok graduated
in 1979 from the Haas Business School at the University of California
(Berkeley).

     John Coppolino was elected a Director in February 1999 and was elected
     --------------
President in December 1999. Mr. Coppolino began with the Company as Director of
Sales in 1994 and became Executive Vice President in September 1997. Mr.
Coppolino also serves as a Director of Hollywood Partners.com, Inc. Mr.
Coppolino has over fifteen years experience in the food industry, including
experience as a food broker and in product manufacturing. Mr. Coppolino
graduated from the Pennsylvania State University School of Business in 1983 with
a degree in Business Logistics.

     Benjamin Tabatchnick was elected a Director of the Company in February
     --------------------
1997. Since January 1990, Mr. Tabatchnick has owned and operated Tabatchnick's
Fine Foods (and predecessors), a privately held concern, which manufactures and
distributes its own trademarked line of frozen soups, and manufactures frozen
and refrigerated foods for others on a contract basis.

     Valerie A. Broadbent was elected as Secretary of the Company in February
     --------------------
1999. Ms. Broadbent began as Assistant to the COO/CFO in October 1997 and became
Executive Administrator in February 1999. Ms. Broadbent also serves as Corporate
Secretary of Hollywood Partners.com, Inc. Ms. Broadbent has over 25 years
experience working in corporate administration and as executive assistant to
senior management for both public and private companies.

     Fred Rigaud has over 25 years of experience in finance and accounting with
     -----------
multinational companies in consumer products, entertainment and the Internet.
Mr. Rigaud received a Bachelor's degree in Liberal Arts from the University of
Montreal in 1964 and is a graduate of Queens College with a B.A. in Finance and
Accounting. From 1996 to 1998, Mr. Rigaud was Chief Financial Officer of Luckman
Interactive, Inc., a developer and marketer of Internet software. From 1987 to
1996, he was associated with Million Dollar Enterprise, a division of
Metropolitan Theatres, Inc., as Vice President of Finance.

ITEM 10:  EXECUTIVE COMPENSATION

     In September 1997, Mr. Beychok entered into a new employment agreement
("Agreement") with the Company for three years.  Under the Agreement, Mr.
Beychok receives an annual base salary of $150,000 and was granted options for
450,000 shares of stock at an exercise price of $0.87 per share, all of which
are currently vested.  In September 1997 Mr. Beychok was given a successful
litigation reward of $51,535 plus

                                       20
<PAGE>

100,000 shares of common stock at fair market value of $1.00. In November 1998
the price of all options other than those related to the private placement were
repriced to $0.10. In August 1999, Mr. Beychok was given a successful litigation
reward of $75,000. In October 1999 Mr. Beychok was granted a new Board of
Director package of an option to purchase 500,000 shares at an exercise price of
$.25 per share, vesting 166,667 shares on October 22, 1999, 166,667 shares on
October 22, 2000 and 166,666 shares on October 22, 2001. In October 1999, the
Board granted Mr. Beychok an option for 900,000 shares at an exercise price of
$.25 per share, vesting 450,000 on October 22, 1999, 225,000 on October 22,
2000, and 225,000 on October 22, 2001. In December 1999 Mr. Beychok was elected
Chairman of the Board and will receive an increase in salary to $185,000 per
year effective January 1, 2000.

     In September 1997, Mr. Coppolino entered into an employment agreement with
the Company for two years.  Under the Agreement, Mr. Coppolino receives an
annual base salary of $120,000, and was granted options for 300,000 shares of
stock at an exercise price of $0.87 per share, all of which are currently
vested.  In September 1997, Mr. Coppolino was given a successful litigation
reward of $25,000, forgiveness of debt of $25,000, plus 25,000 shares of common
stock at $1.00, being the fair market value at the date of the award.  In
November 1998 the price of all options were repriced to $0.10.  In August 1999,
Mr. Coppolino was given a successful litigation reward of $50,000.  In October
1999 Mr. Coppolino was granted a Board of Director package of an option to
purchase 375,000 shares at an exercise price of $.25 per share, vesting 125,000
shares on October 22, 1999, 125,000 shares on October 22, 2000 and 125,000
shares on October 22, 2001.  In October 1999, the Board granted Mr. Coppolino an
option for 750,000 shares at an exercise price of $.25 per share, vesting
375,000 on October 22, 1999, 187,500 on October 22, 2000, and 187,500 on October
22, 2001. In December 1999, the Company entered into a new employment agreement
("Agreement") with Mr. Coppolino for three years. Under the Agreement, Mr.
Coppolino receives an annual base salary of $150,000 effective January 1, 2000.

     The following table sets forth certain information with respect to the
compensation paid by the Company to Messrs. Beychok, Coppolino and Rigaud (the
"named individuals") during 1999, 1998 and 1997:

                          SUMMARY COMPENSATION TABLE
                          --------------------------

<TABLE>
<CAPTION>

Principal Position                                          All Other Annual       Securities Underlying
& Name                       Year   Salary       Other        Compensation            Options/SARs

<S>                          <C>    <C>        <C>               <C>                <C>
Chairman of the Board (*)
Mark Beychok                 1999   $150,000         -           $ 99,588 (1)       1,400,000
                             1998    150,000         -             28,317 (2)               -
                             1997    150,000   $12,500 (3)        102,467 (4)         650,000

President
John Coppolino               1999   $120,000         -           $ 66,850 (5)        1,125,000
                             1998    120,000         -             19,003 (6)                -
                             1997    120,000   $20,750 (7)         59,000 (8)          400,000

Acting CFO
Fred Rigaud                  1999   $ 96,750   $ 5,000 (9)       $ 7,846 (10)          150,000
                             1998          -         -                 -                     -
                             1997          -         -                 -                     -
</TABLE>

(*)  Mr. Beychok served as President and CEO until his resignations as President
in December 1999 and as CEO in February 2000.

                                       21
<PAGE>

(1)  Comprised of $15,600 car allowance, accrued vacation of $8,988 and $75,000
     as a successful litigation reward.
(2)  Comprised of $15,600 car allowance and accrued vacation of $12,717.
(3)  A portion of Mr. Beychok's salary was deferred in 1996 and paid in 1997.
(4)  Comprised of $9,584 car allowance, accrued vacation of $41,348, plus
     $51,535 as a successful litigation reward.
(5)  Comprised of $9,000 car allowance, accrued vacation of $8,988 and $50,000
     as a successful litigation reward.
(6)  Comprised of $9,000 car allowance and accrued vacation of $10,003.
(7)  A portion of Mr. Coppolino's salary, $15,500, and car allowance, $5,250,
     were deferred in 1996 and paid in 1997.
(8)  Comprised of $9,000 car allowance and  $50,000 as a successful litigation
     reward.
(9)  A portion of Mr. Rigaud's salary was deferred in 1999 and used to exercise
     50,000 options at $.10 per share in 2000.
(10) Comprised of $3,000 car allowance and accrued vacation of $4,846.

STOCK OPTION PLAN

     In 1995, the Company adopted the 1995 Stock Option Plan (the "1995 Plan")
pursuant to which 2,000,000 shares of Common Stock were reserved for issuance
upon the exercise of options.  Under the terms of the Plan, all directors,
officers and key employees of, and consultants to, the Company and all its
subsidiaries are eligible for option grants.  The Board determines, at its
discretion, which persons will receive option grants, the number of shares
subject to each option, the exercise price, which may not be less than the par
value of the shares subject to the option, except that in the case of ISO's, the
exercise price must be at least one hundred percent (100%) of the fair market
value of the optioned shares on the date of grant, or one hundred and ten
percent (110%) of such fair market value if the optionee is the owner of more
than ten percent (10%) of the total combined voting power of all classes of
voting stock of the Company (a "10% Holder"), and the term (which may not be
more than ten (10) years from the date of grant, or five (5) years in the case
of an ISO granted to a 10% holder) thereof. The Plans permit options granted
thereunder to be exercised by the tender of shares of common stock having a fair
market value equal to the exercise price of such option.

     Options granted under the Plan may, at the discretion of the Board, be
exercisable upon the tender of cash equal in amount to the aggregate par value
of the shares covered by such options, together with a one-year note bearing
interest at the "applicable federal rate" (as defined in the Code) and providing
for a required prepayment upon any disposition of the acquired shares.

     During 1995 Mr. Beychok was granted an aggregate of 687,500 options under
the Plan with an exercise price of $3.00.  The exercise price of these options
was reduced to $0.91 in May 1997.  In November 1998, the Company reduced the
exercise price of all outstanding options held by officers and directors to
$.10, the then market price of the Company's common stock.

     The following chart sets forth the options granted to directors and
officers in 1999:

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
                            Number of      Percent of                                  Potential realized value
                           securities        total                                   at assumed annual rate of
                           underlying     options/SARs      Exercise                   appreciation for option
                            options/       granted to        of base                             term
                              SARs        employees in        price      Expiration
Name                        granted        fiscal year      ($/Share)       Date             5%            10%
<S>                        <C>            <C>               <C>          <C>         <C>                 <C>
-----------------------------------------------------------------------------------------------------------------
Mark Beychok                 1,400,000           39%           $0.25        10/21/04     $93,153         $205,138
-----------------------------------------------------------------------------------------------------------------
John Coppolino               1,125,000           31%           $0.25        10/21/04     $74,855         $164,843
-----------------------------------------------------------------------------------------------------------------
Benjamin Tabatchnick           375,000            9%           $0.25        10/21/04     $24,952         $ 54,948
-----------------------------------------------------------------------------------------------------------------
Valerie Broadbent              100,000            2%           $0.25        10/21/04     $ 9,411         $ 20,606
-----------------------------------------------------------------------------------------------------------------
Valerie Broadbent              300,000            7%           $0.25        10/21/04     $19,961         $ 43,953
-----------------------------------------------------------------------------------------------------------------
Fred Rigaud                    150,000            4%           $0.25        10/21/02     $ 9,981         $ 21,979
-----------------------------------------------------------------------------------------------------------------
</TABLE>

                                       22
<PAGE>

     The following chart sets forth certain information with respect to
options/warrants exercised during 1999 and outstanding at December 31, 1999 to
the named individuals:


<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------
                                                        Number of               Value of Unexercised
                                                        Securities              In-the-Money
                                                        Underlying              Options/SAR's at
                                                        Unexercised             FY-End
                            Shares                      Options/SARs at FY-     Exercisable/
                            Acquired on     Value       End Exercisable/        Unexercisable
Name                        Exercise        Realized    Unexercisable
-------------------------------------------------------------------------------------------------------
<S>                         <C>             <C>         <C>                     <C>
Mark Beychok                   500,000        $-0-      1,497,292 / 783,333     $1,152,915 / $ 603,166
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
John Coppolino                 350,000        $-0-        718,750 / 625,000     $  553,438 / $ 481,250
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
Benjamin Tabatchnick           250,000        $-0-        125,000 / 250,000     $   96,250 / $192,500
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
Valerie Broadbent               50,000        $-0-        275,000 / 150,000     $  250,250 / $ 77,000
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
Fred Rigaud                         -0-       $-0-        175,000 /  75,000     $  134,750 / $ 57,750
-------------------------------------------------------------------------------------------------------
</TABLE>


ITEM 11:  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
          MANAGEMENT

     The following table sets forth the ownership of the common stock by each
director and by entities or persons known to the Company to own beneficially in
excess of 5% of such stock and by all officers and directors as a group, as of
December 31, 1999. Except as otherwise indicated, all stockholders have sole
voting and investment power with respect to the shares listed as beneficially
owned by them, subject to the rights of spouses under applicable community
property laws.

Name and Address                       Number of Shares    Percentage of
of Beneficial Owner                     of Common Stock      Beneficial
Identity of Group                      Beneficially Owned     Ownership
-----------------                      ------------------     ---------

Mark Beychok (1)                            2,087,292 (2)           7.5 %

John Coppolino (1)                            908,750 (3)           3.3 %

Benjamin Tabatchnick (1)                      375,000 (4)           1.4 %

Valerie A. Broadbent (1)                      325,000 (5)           1.2 %

Fred Rigaud (1)                               125,000 (6)            .4 %

Terra Healthy Living, Ltd.                  7,813,795 (7)          28.0 %

All directors and officers as a group.
(5 persons) (2)(3)(4)(5) and (6)            3,821,042              13.8 %

(1)  The address of these persons is 1800 Avenue of the Stars, Suite 480, Los
     Angeles, California 90067.

                                       23
<PAGE>

(2)  Includes (i) 100,000 shares underlying a currently exercisable option with
an exercise price of $0.10 per share expiring on September 15, 2003; (ii)
130,625 shares underlying a currently exercisable option, expiring December 16,
2003, which has an exercise price of $0.10 per share; (iii) 100,000 shares
underlying a currently exercisable option with an exercise price of $0.10 which
expires on June 16, 2005; (iv) 100,000 shares underlying a currently exercisable
option with an exercise price of $.10 which expires on December 31, 2005; (v)
450,000 shares underlying a currently exercisable option with an exercise price
of $0.10 per share expiring September 1, 2005; (vi) 166,667 shares underlying a
currently exercisable option with an exercise price of $.25 per share, expiring
October 21, 2004, and does not include 333,333 shares underlying options which
are not currently exercisable, expiring October 21, 2004; (vii) 450,000 shares
underlying a currently exercisable option with an exercise price of $.25 per
share, expiring October 21, 2004, and does not include 450,000 shares underlying
options which are not currently exercisable, expiring October 21, 2004; and
(viii) 590,000 shares currently issued through the exercise of options.

(3)  Includes (i) 188,750 shares underlying a currently exercisable option with
an exercise price of $0.10 per share expiring on September 1, 2002; (ii) 125,000
shares underlying a currently exercisable option with an exercise price of $.25
per share expiring on October 21, 2004, and does not include 250,000 shares
underlying an option with an exercise price of $0.25 per share, which are not
currently exercisable, expiring October 21, 2004; and (iii) 375,000 shares
underlying a currently exercisable option with an exercise price of $.25 per
share expiring October 21, 2004, and does not include 375,000 shares underlying
an option with an exercise price of $0.25 per share, which are not currently
exercisable, expiring October 21, 2004; and (iv) 220,000 shares currently issued
through the exercise of options.

(4)  Includes (i) 125,000 shares underlying a currently exercisable option with
an exercise price of $0.25 per share granted in 1999, which expires October 21,
2004; and (ii) 250,000 shares issued through the exercise of options at $.10 per
share in 1999. It does not include (iii) 250,000 shares underlying an option,
which are not currently exercisable, with an exercise price of $.25 per share
expiring October 21, 2004.

(5)  Includes (i) 25,000 shares underlying a currently exercisable option
with an exercise price of $0.085 per share, expiring on January 29, 2003; (ii)
50,000 shares underlying a currently exercisable option with an exercise price
of $0.33 expiring on July 1, 2004; (iii) 100,000 shares with a currently
exercisable price of $0.25 per share expiring on  October 21, 2004; (iv) and
100,000 shares with a currently exercisable price of $0.25 per share expiring on
October 21, 2004; (v) 50,000 shares issued through the exercise of options.  It
does not include:   (vi) 50,000 shares underlying an option with an exercise
price of $.33 per share, which are not currently exercisable, expiring July 1,
2004 and (vii) 100,000 shares underlying an option with an exercise price of
$.25, which are not currently exercisable, expiring October 21, 2004.

(6)  Includes (i) 75,000 shares underlying a currently exercisable option with
an exercise price of $.25 per share expiring October 21, 2002; (ii) 50,000
shares issued through the exercise of options. It does not include 75,000 shares
underlying an option with an exercise price of $.25 per share, which are not
currently exercisable, expiring October 21, 2002.

(7)  The number of shares beneficially owned is based on the most recent
communication with the shareholder.  Includes 2,000,000 shares which are subject
to redemption by the Company pursuant to an agreement.  See "Certain
Relationships and Related Transactions."

     The following table sets forth the ownership of the Series B Preferred
Stock by each director and by each entity or person known to the Company to own
beneficially in excess of 5% of such class of stock and by all officers and
directors as a group.  To the Company's knowledge, all stockholders have sole
voting and investment power with respect to the shares listed as owned by them,
subject to applicable community property laws.

                                       24
<PAGE>

<TABLE>
<CAPTION>
Title of Class                 Name and Address of                      Number of        Percentage
                               Beneficial Owner                        Shares Owned       Of Class
------------------------------------------------------------------------------------------------------------
<S>                            <C>                                     <C>               <C>
                               Thomas Von Ledersteger
Series B Preferred Stock       23 Chemin des Meandres                      500             50%
                               CH-1287 Laconnex/GE, Switzerland
------------------------------------------------------------------------------------------------------------
                               Pictet et CIE
Series B. Preferred Stock      29 Boulevard Georges Favon                  500             50%
                               CH-1211 Geneva, Switzerland
------------------------------------------------------------------------------------------------------------
                               All officers and directors as a group
Series B Preferred Stock       (5 persons)                                   0              0%
------------------------------------------------------------------------------------------------------------
1997 Series A                  All officers and directors as a group
Preferred Stock                (5persons)                                    0              0%
------------------------------------------------------------------------------------------------------------
</TABLE>

ITEM 12:  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The Company has employment agreements with Mark Beychok and John Coppolino,
and had employment agreements, consulting agreements and settlement agreements
with certain of its former officers.  See "Management - Executive Compensation."

     On January 22, 1999, the Company completed the Closing under a series of
agreements including a Common Stock Purchase Agreement (the "CSPA"), dated as of
December 30, 1998, by and among the Company; Terra Healthy Living, Ltd, a B.V.I.
corporation ("Terra"); Sovereign Partners, a Connecticut limited partnership
("Sov"); and Dominion Capital Fund, Ltd., a Bahamian corporation ("Dom").  All
of the transactions contemplated by the CSPA were deemed to have occurred on
December 31, 1998.  Pursuant to the CSPA:

     Terra acquired 2,712,843 shares of the Company's common stock from Sov and
Dom for $235,000.  Such shares were issued upon the conversion by Sov and Dom of
an aggregate of 235 shares of the Company's 1997 Series A Convertible Preferred
Stock ("Series A Preferred").

     The Company borrowed $2,065,000 from Terra pursuant to a Promissory Note
With Warrant and Registration Rights (the "Terra Note").  The Terra Note is a
five year note bearing interest at 6% per annum.  Interest on the Terra Note is
payable annually.  The Terra Note provided for the issuance to Terra of a five
year warrant (the "Terra Warrant") for the purchase of 500,000 shares of the
Company's common stock at $.25 per share.  The Terra Note further provides that
the first year's interest on the Terra Note shall be applied to the partial
exercise of the Terra Warrant.  The Company and Terra have entered into a
Registration Rights Agreement requiring the registration under the Securities
Act of 1933, as amended (the "Act") of the securities issuable upon exercise of
the Terra Warrant.

     The Company applied the $2,065,000 proceeds of the Terra Note to redeem all
1,351 remaining shares of Series A Preferred held by Sov and Dom as well as a
convertible debenture in the amount of $548,352 held by Dom pursuant to an
Agreement and Consent to Redeem Series A Preferred Stock and Debentures (the
"Redemption Agreement").

     The aggregate of $2,300,000 paid by Terra in connection with its purchase
of the 2,712,843 shares of the Company's common stock from Sov and Dom and in
connection with the Terra Note was satisfied through the delivery to Sov and Dom
of marketable securities having a value of $2,300,000.  Under the CSPA, Terra
made certain assurances to Sov and

                                       25
<PAGE>

Dom and assumed certain obligations to assure that Sov and Dom would realize
$2,300,000 on the sale of the marketable securities including the delivery of
additional securities to them.

     The Company borrowed $300,000 from each of Sov and Dom pursuant to a non-
negotiable nine month promissory note bearing interest at 8% per annum (the "Sov
Note" and the "Dom Note").  These notes provide for their repayment, at the
option of the Company, in free trading registered common stock which shall be
valued at the then market for such stock.  The Sov Note and the Dom Note provide
for the issuance to each of Sov and Dom of 60,000 warrants which expire on
December 31, 2003, half of which are exercisable at $.40 and half of which are
exercisable at $.25.  If the Company repays the Sov Note or the Dom Note with
common stock, then the exercise price of the $.25 warrant is reduced to $.01.
The Company entered into a Registration Rights Agreement with Sov and Dom.

     The CSPA granted the Company the right to redeem up to 2,000,000 of the
shares of its common stock acquired by Terra through June 30, 2000 based upon a
formula related to the market price of the common stock at the time of
conversion.

     The Company issued 571,232 shares of its common stock to Sov in connection
with the prior conversion of 40 shares of Series A Preferred Stock.

     In December 1998, the Company sold 1,000,000 shares to Terra Healthy
Living, Ltd., a principal stockholder, for $250,000 (or $.25 per share) which
was paid by delivery to the Company of marketable securities.  The Company
believes that the price paid for such shares was no less favorable to the
Company than that which would have been paid by an unaffiliated purchaser.

                                       26
<PAGE>

                                    PART IV

ITEM 13:         EXHIBITS LIST
                 -------------

(a)  The following exhibits are submitted herewith:

     3.l    Certificate of Incorporation of Registrant(i)
     3.2    By-laws of Registrant(i)
     3.3    Agreement and Plan of Merger between the Registrant and
            Vitafort International Corporation, a California corporation(i)
     3.4    Certificate of Designation - Series A Preferred Stock(v)
     3.5    Certificate of Designation - Series B Preferred Stock(v)
     3.6    Certificate of Amendment to the Certificate of Incorporation,
            November 1991(v)
     3.7    Certificate of Designation - Series C Preferred Stock(v)
     3.8    Certificate of Amendment to the Certificate of Incorporation, filed
            February 8, 1994 (vi)
     3.9    Certificate of Designation - Series D Preferred Stock(vi)
     3.10   Certificate of Amendment to the Registrant's Certificate of
            Incorporation, filed November, 1995. Incorporated by reference to
            Exhibit 4.10 filed with the Registrant's Registration Statement on
            Form S-8 filed January 25, 1996 File Number 33-300435 (the " January
            1996 S-8").
     3.11   Certificate of Elimination - Series A Preferred Stock. Incorporated
            by reference to Exhibit 4.24 to the Registrant's Registration
            Statement on Form S-8 Filed May 22, 1996 File Number 333-04271 (the
            "May 1996 S-8").
     3.12   Certificate of Elimination - Series D Preferred Stock.  Incorporated
            by reference to Exhibit 4.25 to the May 1996 S-8.
     3.13   Certificate of Amendment to the Registrant's Certificate of
            Incorporation, filed October 4, 1996. Incorporated by reference to
            Exhibit 4.29 to the Registrant's Registration Statement on Form S-8
            Filed December 12, 1996, File Number 333-17763 (the "December 1996
            S-8").
     3.14   Amended Certificate of Designation of the Registrant's 1997 Series A
            Preferred Stock filed May 1997 (ix)
     3.15   Amended Certificate of Designation of the Registrant's 1997 Series A
            Preferred Stock filed March 1998 (xii)
     3.16   Amended Certificate of Designation of the Registrant's 1997 Series A
            Preferred Stock filed October 1998 (xiii)
     3.17   Convertible Debenture dated August 1998 (xiii)
     4.1    Specimen Stock Certificate. Incorporated by reference to Exhibit 4.1
            Filed with the Registrant's Annual Report on Form 10K-SB for the
            Year ended December 31, 1996 (the "1996 10K-SB")
     4.2    Specimen Redeemable Common Stock Purchase Warrant(i)
     4.3    Form of Warrant Agreement(i)
     4.4    Proposed form of Underwriters Warrant Agreement(i)
     4.5
     4.6    Warrant Extension Agreement, December 18, 1992(v)
     4.7    Warrant Extension Agreement, December 18, 1994(vi)
     4.8    Warrant Extension Agreement, January 18, 1995(vi)
     4.9    Warrant Extension Agreement, April 3, 1995(vi)
     4.10   Warrant Extension Agreement, May 3, 1995.  Incorporated by reference
            to Exhibit 4.18 to the January 1996 S-8.
     4.11   Warrant Extension Agreement, June 15, 1995.  Incorporated by
            reference to Exhibit 4.19 to the January 1996 S-8.
     4.12   Warrant Extension Agreement, July 17, 1995.  Incorporated by
            reference to Exhibit 4.20 to the January 1996 S-8.

                                       27
<PAGE>

     4.13   Warrant Extension Agreement, August 16, 1995. Incorporated by
            reference to Exhibit 4.21 to the January 1996 S-8.
     4.14   Warrant Extension Agreement, December 31, 1995.  Incorporated by
            reference to Exhibit 4.21 to the January 1996 S-8.
     4.15   Warrant Extension Agreement, April 30, 1996.  Incorporated by
            reference to Exhibit 4.23 to the May 1996 S-8.
     4.16   Warrant Extension Agreement, July 31, 1996.  Incorporated by
            reference to Exhibit  4.26 to the December 1996 S-8.
     4.17   Warrant Extension Agreement, September 30, 1996.  Incorporated by
            reference to Exhibit  4.27 to the December 1996 S-8.
     4.18   Warrant Extension Agreement, November 11, 1996.  Incorporated by
            reference to Exhibit  4.28 to the December 1996 S-8.
     4.19   Warrant Extension Agreement, April 15, 1997.  Incorporated by
            reference to Exhibit 4.19 to the 1996 10K-SB.
     4.20   Warrant Extension Agreement, October 31, 1997.(x)
     10.1   Loan Agreement, dated August 19, 1988, between the Registrant and
            Bishop Capital, L.P. and promissory note in the principal amount of
            $150,000(i)
     10.2   License Agreement, dated April 25, 1986, between the Registrant and
            Crystal Geyser Water Registrant and  amendment, dated January 7,
            1988(i)
     10.3   Demand Promissory Note, dated July 10, 1987, from Registrant to
            Joseph R. Daly in the principal amount of $300,000 and Modification,
            dated October 11, 1989(i)
     10.4   License Agreement, dated as of October 9, 1987, between the
            Registrant and Good Health Beverage, Inc. and amendment, dated
            November 23, 1988(i)
     10.5   Product Development Agreement, dated as of January 21, 1988, between
            the Registrant and International Multifoods, Inc.(i)
     10.6   Beverage Agreement, dated as of October 31, 1988, between  the
            Registrant and PowerBurst Corporation(i)
     10.7   Amended and Restated Agreement, dated August 2, 1989, between the
            Registrant and Vitafort Far East Co., Ltd.(i)
     10.8   Agreement, dated August 11, 1989, between Barry Saltzman, MD. and
            Yoshio Tanaka(i)
     10.9   Lease, dated June 13, 1988, between Registrant and Shelterpoint
            Equities, Ltd. for offices at 591 Redwood Highway, Mill Valley,
            California(i)
     10.10  Agreement, dated July 25, 1989, between Nutrifish Corporation and
            Mt. Lassen Trout Farms(i)
     10.11  Salmon Rondelles Joint Development and Marketing Agreement, dated as
            of September 18, 1989, between Nutrifish Corporation and
            Norwegian Seafoods, Inc.(i)
     10.12  Whole Salmon Joint Development and Marketing Agreement, dated as of
            September 26, 1989, between Nutrifish Corporation and Norwegian
            Seafoods, Inc.(i)
     10.13  Employment Agreement, dated September 13, between the Registrant and
            Barry K. Saltzman(i)
     10.14  Employment Agreement, dated September 13, between the  Registrant
            and Jeffrey Lewenthal(i)
     10.15  The Registrant's 1989 Stock Option Plan(i)
     10.16  Stock Option Agreement, dated as of July 17, 1989 between  the
            Registrant and Jeffrey Lewenthal(i)
     10.17  Secrecy Agreement, dated as of May 2, 1986, between the Registrant
            and Hoffman-LaRoche, Inc.(i)
     10.18  Joint Venture Agreement, dated September 29, 1989, between the
            Registrant and Agrolife Technologies, Inc.(i)
     10.19  Consulting Agreement, dated September 13, 1989, between the
            Registrant and Randall S. Reis(i)
     10.20  Loan Agreement, dated June 15, 1989, between Union Bank and Joseph
            R. Daly(i)
     10.21  Form of Employee Confidentiality Agreement.(ii)
     10.23  Form of Escrow Agreement by and among the Registrant,  Gilford
            Securities Corp., and certain stockholders of  Registrant(i)

                                       28
<PAGE>

     10.24  Promissory Note, made November 21, 1989, by Nutrifish Corporation
            and payable to Joseph R. Daly(i)
     10.25  Right of First Refusal Agreement, dated November 21, 1989, between
            Nutrifish Corporation and Joseph R. Daly(i)
     10.26  Production License Agreement for Nutrifish Norwegian Salmon, dated
            February 2, 1990, between Nutrifish Corporation and Norwegian
            Seafoods, Inc.(ii)
     10.27  Test Market Agreement, dated December 19, 1989, between
            International Multifoods Corporation and the Registrant.(ii)
     10.28  Amendment, dated as of December 19, 1989, to the Product
            Development Agreement between International Multifoods
            Corporation and the Registrant.(ii)
     10.29  Consulting Agreement, dated February 21, 1990, between the
            Registrant and Joseph R. Daly.(ii)
     10.30  License Agreement between the Registrant and Nulaid Foods, Inc.,
            dated April 30, 1990.(ii)
     10.31  License Agreement between the Registrant and Vitafort Latin America,
            dated July 30, 1990.(ii)
     10.32  Termination Agreement between the Registrant and Jeffrey D.
            Lewenthal, dated September 12, 1990.(ii)
     10.33  Settlement Agreement and Full Release between Nicholas J. Caputo and
            Registrant, dated October 4, 1990.(ii)
     10.34  Employment Agreement between the Registrant and Stephen D. Clow,
            dated December 1, 1990.(ii)
     10.35  Employment Agreement between the Registrant and Frank A. Corsini,
            dated January 2, 1991.(ii)
     10.36  Stock Option Agreement between the Registrant and Stephen D. Clow,
            dated January 2, 1991.(ii)
     10.37  Stock Option Agreement between the Registrant and Frank A. Corsini,
            dated January 2, 1991.(ii)
     10.38  Letter Agreement, dated February 1, 1991, amending Consulting
            Agreement between the Registrant and Joseph R. Daly.(ii)
     10.39  Letter Agreement, dated March 12, 1991, between the Registrant and
            Joseph R. Daly regarding debt reorganization.(ii)
     10.40  Consulting Agreement between Norman Kretchmer, MD., Ph.D., and the
            Registrant, dated December 20, 1988.(ii)
     10.41  Settlement Agreement between the Registrant and PowerBurst
            Corporation, dated September 23, 1991.(ii)
     10.42  Subscription Agreement between the Registrant and Societe Anonyme
            Financier Industrielle et Garantie, dated November 1, 1991.
            Incorporated by reference to Exhibit 1 to the Registrant's Report on
            Form 8-K dated November 1, 1991.
     10.43  Exclusive Distribution Agreement between Registrant and Chicago Fish
            House, dated June 13, 1991.(ii)
     10.44  Larry Lucas Settlement Agreement, dated March 25, 1993.(v)
     10.45  Frank Corsini, Separation Agreement, dated May 18, 1993.(v)
     10.46  Agreement dated October 5, 1993 between the Registrant and Second
            Nature Technologies, Inc.(iii)
     10.47  Food and Beverage Technology Agreement(iii)
     10.48  Asset Purchase and Sale Agreement, dated as of June 7, 1993 by and
            among Crystal Clear Farms, Inc., a Maine corporation, the Registrant
            and Salmon Distribution Subsidiary, Inc. a Maine corporation which
            was formerly known as Crystal Clear Farms, Inc.(iv)
     10.49  Temporary Operating Agreement dated June 7, 1993 by and among Samuel
            L. Thompson & Associates, Inc., a Maine corporation, the Registrant
            and Crystal Clear Farms, Inc. a Maine corporation (now known as
            Salmon distribution Subsidiary, Inc.)(iv)
     10.50  Non-Competition Agreement dated July 27, 1993 by and between the
            Registrant and Crystal clear farms, Inc., a Maine corporation.(iv)

                                       29
<PAGE>

     10.51  Employment Agreement dated as of November 29, 1993, between the
            Registrant and Steven Westlund. Incorporated by reference to exhibit
            99.01 to Form S-8 filed by the Registrant on March 4, 1994 (the
            "1994 S-8").
     10.52  Stock Option Agreement dated as of November 29, 1993 between the
            Registrant and Steven Westlund. Incorporated by reference to exhibit
            99.02 to the 1994 S-8.
     10.53  Stock Option Agreement dated as of September 15, 1993 between the
            Registrant and Steven Westlund. Incorporated by reference to exhibit
            99.03 to 1994 S-8.
     10.54  Employment Agreement dated as of November 29, 1993 between the
            Registrant and Peter Benz. Incorporated by reference to exhibit
            99.04 to 1994 S-8.
     10.55  Stock Option Agreement dated as of November 29, 1993 between the
            Registrant and Peter Benz. Incorporated by reference to exhibit
            99.05 to 1994 S-8.
     10.56  Employment Agreement dated as of November 29, 1993 between the
            Registrant and Mark Beychok. Incorporated by reference to exhibit
            99.06 to the 1994 S-8.
     10.57  Stock Option Agreement dated as of November 29, 1993 between the
            Registrant and Mark Beychok. Incorporated by reference to exhibit
            99.07 to the 1994 S-8.
     10.58  Stock Option Agreement dated as of September 15, 1993 between the
            Registrant and Mark Beychok. Incorporated by reference to exhibit
            99.08 to the 1994 S-8.
     10.59  Consulting Agreement dated as of November 29, 1993 between the
            Registrant and Herman Jacobs.  Incorporated by reference to
            exhibit 99.09 to the 1994 S-8.
     10.60  Stock Option Agreement dated as of November 29, 1993 between the
            Registrant and Herman Jacobs.  Incorporated by reference to
            exhibit 99.10 to the 1994 S-8.
     10.61  Vitafort International Corporation 90 Day Operating Plan.
            Incorporated by reference to exhibit 99.21 to the 1994 S-8.
     10.62  Stock Option Agreement, dated September 15, 1993, between the
            Registrant and Stanley J. Pasarell.  Incorporated by reference to
            exhibit 99.22 to the 1994 S-8.
     10.63  Separation and Release Agreement, dated as of December 1, 1994,
            between the Registrant and Peter Benz.(vi)
     10.64  Letter Agreement, dated September 14, 1995, between the Registrant
            and Peter T. Benz. Incorporated by reference to the like numbered
            exhibit to the Registrant's Form 10-KSB for the year ended December
            31, 1995.
     10.65  Consulting Agreement and Mutual Release, dated as of March 1, 1995,
            between the Registrant and Steven R. Westlund. Incorporated by
            reference to the like numbered exhibit to the Registrant's Form 10-
            KSB for the year ended December 31, 1995.
     10.66  Letter Agreement, dated November 30, 1995, between the Registrant
            and Steven Westlund. Incorporated by reference to the like numbered
            exhibit to the Registrant's Form 10-KSB for the year ended December
            31, 1995.
     10.67  The Vitafort International Corporation 1995 Stock Option Plan.
            Incorporated by reference to exhibit 99.01 to the January 1996 S-8.
     10.68  Form of Option granted to directors under The Vitafort International
            Corporation 1995 Stock Option Plan and schedule of grants to
            directors. Incorporated by reference to exhibit 99.02 to the January
            1996 S-8.
     10.69  Employee Option granted to Mark Beychok under The Vitafort
            International Corporation 1995 Stock Option Plan. Incorporated by
            reference to exhibit 99.03 to the January 1996 S-8.
     10.70  Amendment, dated December 16, 1995, to the Employment Agreement
            between the Registrant and Mark Beychok. Incorporated by reference
            to exhibit 99.10 to the January 1996 S-8.
     10.71  Option Agreement, dated December 16, 1995, between the Registrant
            and Mark Beychok. Incorporated by reference to exhibit 99.11 to the
            January 1996 S-8.
     10.72  Conversion Agreement, dated as of December 30, 1995, between the
            Registrant and Mark Beychok. Incorporated by reference to exhibit
            99.20 to the January 1996 S-8.
     10.73  Class A Option Agreement, dated as of December 30, 1995, between the
            Registrant and Mark Beychok. Incorporated by reference to exhibit
            99.21 to the January 1996 S-8.
     10.74  Class B Option Agreement, dated as of December 30, 1995, between the
            Registrant and Mark Beychok. Incorporated by reference to exhibit
            99.22 to the January 1996 S-8.

                                       30
<PAGE>

       10.75  Conversion Agreement, dated as of March 26, 1996, between the
              Registrant and John Coppolino. Incorporated by reference to
              Exhibit 9.18 to the May 1996 S-8.
       10.76  Class A Option Agreement, dated as of March 26, 1996, between the
              Registrant and John Coppolino. Incorporated by reference to
              Exhibit 9.19 to the May 1996 S-8.
       10.77  Class B Option Agreement, dated as of March 26, 1996, between the
              Registrant and John Coppolino. Incorporated by reference to
              Exhibit 9.20 to the May 1996 S-8.
       10.78  Employment Agreement, between the Registrant and John Coppolino.
              Incorporated by reference to Exhibit 10.78 to the 1996 Form 10-
              KSB.
       10.79  Foreclosure Purchase Agreement related to the Acquisition of
              assets of Auburn Farms, Inc. Incorporated by reference to Exhibit
              1 to the Registrant's Form 8-K, dated May 2, 1996.
       10.80  Loan and Security Agreement, dated August 15, 1996, between the
              Registrant and Coast Business Credit, a division of Southern
              Pacific Thrift & Loan Association. Incorporated by reference to
              Exhibit 1 to the Registrant's Form 8-K, dated August 15, 1996.
       10.81  Agreement, dated as of July 10, 1996, between the Registrant and
              Second Nature Technologies, Inc. Incorporated by reference to
              Exhibit 10.81 to the 1996 Form 10-KSB.
       10.82  Employment Agreement dated June 16, 1997 between Jack Spencer and
              the Registrant. Incorporated by reference to Exhibit 10.12 of the
              Registrant's Form SB-2 filed July 23,1997
       10.83  Agreement, dated April 1997, between the Registrant and ATCOLP
              Investment Partners, a California Limited Partnership.
              Incorporated by reference to the Registrant's Form SB-2 filed July
              23, 1997
       10.84  Employment Agreement dated September 1997 between the Registrant
              and Mark Beychok. (x)
       10.85  Employment Agreement dated September 1997 between the Registrant
              and John Coppolino.(x)
       10.86  Subscription Agreement with Global International Sourcing, Inc., a
              Nevada corporation (xii)
       10.87  Administrative Services Agreement dated October 1, 1999 between
              the Registrant and Hollywood Partners.com, Inc. (filed herewith)
       10.88  Distribution Agreement dated October 1, 1999 between the
              Registrant and Hollywood Partners.com, Inc. (filed herewith)
       22.    Subsidiaries of the Registrant: Global International Sourcing,
              Inc. (xii)
       23.1   Consent of BDO Seidman, LLP (filed herewith)
       27.    Financial Data Schedule (filed herewith)

(i)    Incorporated by reference to the same numbered exhibit to the
       Registrant's Registration Statement on Form S-18, file number 33-31883.
(ii)   Incorporated by reference to the same numbered exhibit to the
       Registrant's December 31, 1990 and 1989 Form 10-K's.
(iii)  Incorporated by reference to exhibits 1 & 2 to the Registrant's September
       30, 1993 Form 10-QSB.
(iv)   Incorporated by reference to exhibits 1 through 4 to the Registrant's
       August 7, 1993 Form 8-K.
(v)    Incorporated by reference to the same numbered exhibit to the
       Registrant's December 31, 1993 Form 10-KSB.
(vi)   Incorporated by reference to the same numbered exhibit to the
       Registrant's December 31, 1994 Form 10-KSB.
(vii)  Incorporated by reference to the same numbered exhibit to the
       Registrant's December 31, 1995  Form 10-KSB.
(viii) Incorporated by reference to the same numbered exhibit to the
       Registrant's December 31, 1996 Form 10-KSB.
(ix)   Incorporated by reference to the same numbered exhibit to the
       Registrant's December 31, 1997 Form 10-KSB.
(x)    Incorporated by reference to the same numbered exhibit to the
       Registrant's January 14, 1998 Form SB-2/A.

                                       31
<PAGE>

(xi)   Incorporated by reference to the same numbered exhibit to the
       Registrant's June 24, 1998 Form SB-2/A.
(xii)  Incorporated by reference to the same numbered exhibit to the
       Registrant's August 14, 1998 Form SB-2/A.
(xiii) Incorporated by reference to the same numbered exhibit to the
       Registrant's November 12, 1998 Form SB-2/A.


(b)    Reports on Form 8-K.
       There were no reports on Form 8-K filed during the fourth quarter ended
       December 31, 1998.

                                       32
<PAGE>

     SIGNATURES

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

VITAFORT INTERNATIONAL CORPORATION


By: /s/ John Coppolino
   ------------------------------
    John Coppolino, President

Los Angeles, California
Date:  April 14, 2000


Pursuant to the requirements of the Exchange Act, this report has been duly
signed below by the following persons on behalf of the Registrant and in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
Name                               Title(s)                             Date
-----------------------------------------------------------------------------------------
<S>                                <C>                                 <C>
 /s/ Mark Beychok                  Chairman of the Board               April 14, 2000
-----------------------------
Mark Beychok

 /s/ John Coppolino                Director and President              April 14, 2000
-----------------------------
John Coppolino                     (Principal Executive Officer)

 /s/ Fred Rigaud                   Acting Chief Financial Officer      April 14, 2000
-----------------------------
Fred Rigaud                        (Principal Accounting Officer)

 /s/ Benjamin Tabatchnick          Director                            April 14, 2000
-----------------------------
Benjamin Tabatchnick
</TABLE>

                                       33
<PAGE>

              VITAFORT INTERNATIONAL CORPORATION AND SUBSIDIARIES
                  INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


Report of Independent Certified Public Accountants            F-2

Consolidated Balance Sheets - December 31, 1999 and 1998      F-3

Consolidated Statements of Operations -
     Years Ended December 31, 1999 and 1998                   F-5

Consolidated Statements of Stockholders' Equity (Deficit) -
     Years Ended December 31, 1999 and 1998                   F-6

Consolidated Statements of Cash Flows -
     Years Ended December 31, 1999 and 1998                   F-7

Summary of Accounting Policies                                F-8

Notes to Consolidated Financial Statements                    F-11

                                      F-1
<PAGE>

              Report of Independent Certified Public Accountants

Board of Directors and Stockholders
VITAFORT INTERNATIONAL CORPORATION
Los Angeles, California

We have audited the accompanying consolidated balance sheets of Vitafort
International Corporation and Subsidiaries as of December 31, 1999 and 1998, and
the related consolidated statements of operations, stockholders' equity
(deficit) and cash flows for each of the two years then ended. 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 generally accepted auditing
standards. 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 consolidated financial position of Vitafort
International Corporation and Subsidiaries at December 31, 1999 and 1998, and
the consolidated results of their operations and their cash flows for each of
the two years then ended, in conformity with generally accepted accounting
principles.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company has suffered recurring losses from operations,
including a loss of $1,058,591 for the year ended December 31, 1999. These
losses and other factors 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 2. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.

                                                     /s/  BDO SEIDMAN, LLP

Los Angeles, California
April 10, 2000

                                      F-2
<PAGE>

                VITAFORT INTERNATIONAL CORPORATION & SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

                                    ASSETS
                                    ------

<TABLE>
<CAPTION>
                                                        December 31,             December 31,
                                                           1999                     1998
                                                        ------------             ------------
<S>                                                     <C>                      <C>
Current Assets
 Cash and cash equivalents                               $ 1,119,153              $   903,649
 Marketable securities                                       536,667                  250,000
 Accounts receivable, less allowance
   for doubtful accounts of $63,782 and $41,775              139,137                  929,006
 Other receivables                                            47,383                        -
 Inventories                                                 585,407                  196,603
 Prepaid expenses and other current assets                   676,753                  132,509
                                                         -----------              -----------
   Total Current Assets                                    3,104,500                2,411,767
                                                         -----------              -----------

Equipment
 Manufacturing equipment                                     106,019                   19,881
 Furniture and office equipment                              109,654                  105,160
 Computer equipment                                          270,588                  209,574
                                                         -----------              -----------
                                                             486,261                  334,615
 Less accumulated depreciation                               305,434                  271,411
                                                         -----------              -----------
  Net Equipment                                              180,827                   63,204
                                                         -----------              -----------

Other Assets
 Intangible assets, net of accumulated amortization
  of $96,297 and $66,236                                     526,856                  911,684
 Other assets                                                138,006                      875
                                                         -----------              -----------
  Total Other Assets                                         664,862                  912,559
                                                         -----------              -----------

Total Assets                                             $ 3,950,189              $ 3,387,530
                                                         ============             ===========
</TABLE>

See accompanying summary of accounting policies and notes to the consolidated
                             financial statements

                                      F-3
<PAGE>

               VITAFORT INTERNATIONAL CORPORATION & SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS

                LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
                ---------------------------------------------

<TABLE>
<CAPTION>
                                                               December 31,             December 31,
                                                                   1999                     1998
                                                              ---------------          ---------------
<S>                                                             <C>                      <C>
Current Liabilities
  Notes payable - bank                                          $           -             $   283,689
  Notes payable - other                                               392,209                 958,724
  Convertible notes payable                                                 -                 600,000
  Accounts payable                                                    836,500               1,054,079
  Accrued expenses                                                    469,533                  130,303
                                                                -------------             ------------
    Total Current Liabilities                                       1,698,242                3,026,795
                                                                -------------             ------------

Long-term debt due a shareholder                                            -                2,065,000
Notes payable - other, less current portion                            26,331                        -
                                                                -------------             ------------
    Total Long-term Liabilities                                        26,331                2,065,000
Minority Interest                                                     654,151                        -

Stockholders' Equity (deficit)
  Series B, 10% cumulative convertible preferred
   stock, $.01 par value; authorized 110,000 shares;
   issued and outstanding 1,000 shares, aggregate
   liquidation preference of $50,000                                       10                       10
  Series C, convertible preferred stock, $.01 par value;
   authorized 450 shares; issued and outstanding 50 Shares,                 1                        1
   aggregate liquidation preference of $50,000
  Common stock, $.0001 par value; authorized 30,000,000
   shares; issued and outstanding 17,487,288 and 12,056,428             1,749                    1,206
   shares

  Additional paid-in-capital                                       28,398,646               24,064,868
  Accumulated deficit                                             (26,828,941)             (25,770,350)
                                                                -------------             ------------
    Total Stockholders' Equity (Deficit)                            1,571,466                (1,704,265)
                                                                -------------             -------------

Total Liabilities and Stockholders' Equity (Deficit)            $   3,950,189             $   3,387,530
                                                                =============             =============
</TABLE>

See accompanying summary of accounting policies and notes to the consolidated
                             financial statements

                                      F-4
<PAGE>

              VITAFORT INTERNATIONAL CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                         Years Ended
                                                                         December 31,
                                                                     1999            1998
                                                                 ------------    ------------
<S>                                                              <C>             <C>
Net revenues                                                     $  2,451,531    $  2,861,392

Cost of sales                                                       1,911,676       1,876,319
                                                                 ------------    ------------

      Gross profit                                                    539,855         985,073
                                                                 ------------    ------------

Operating expenses
  Research and development                                            104,615         362,770
  Sales and marketing                                               2,152,665       2,035,125
  General and administrative                                        2,576,844       2,557,890
                                                                 ------------    ------------
    Total operating expenses                                        4,834,124       4,955,785
                                                                 ------------    ------------

    Loss from operations                                           (4,294,269)     (3,970,712)

Other income (expense)
  Interest income                                                       8,239          39,591
  Litigation recovery, net of costs                                 1,256,632              --
  Gain on exchange of subsidiary stock                              1,521,482              --
  Minority interest in net loss of consolidated subsidiary            364,341              --
  Loss on disposal of assets                                               --         (42,246)
  Other income (expense)                                               69,518         (59,684)
  Interest expense                                                   (366,609)       (221,547)
                                                                 ------------    ------------
    Total other income (expense)                                    2,853,603        (283,886)
                                                                 ------------    ------------

   Loss before income tax expense                                 (1,440,666)     (4,254,598)

State income tax expense                                                3,534           3,407
                                                                 ------------    ------------

Loss before extraordinary item                                    (1,444,200)     (4,258,005)
Extraordinary gain on extinguishment of debt                          385,609              --
                                                                 ------------    ------------

Net loss                                                           (1,058,591)     (4,258,005)
Deemed dividend to preferred shareholders                                  --        (629,148)
                                                                 ------------    ------------
Net loss allocable to common shareholders                          (1,058,591)     (4,887,153)
                                                                 ============    ============

Basic and diluted net loss per common share:
     Loss before extraordinary item                                     (0.10)          (0.66)
     Extraordinary gain on extinguishment of debt                        0.03              --
                                                                 ------------    ------------
Basic and diluted net loss per common share                      $      (0.07)   $      (0.66)
                                                                 ============    ============

Basic and diluted weighted average shares of common stock         14,465,803       7,348,093
                                                                 ============    ============
</TABLE>

 See accompanying summary of accounting policies and notes to the consolidated
                             financial statements

                                      F-5
<PAGE>

              VITAFORT INTERNATIONAL CORPORATION AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
                    Years Ended December 31, 1999 and 1998

<TABLE>
<CAPTION>
                                                                 Series A                Series B               Series C
                                                                Convertible             Convertible            Convertible
                                                              Preferred Stock         Preferred Stock        Preferred Stock
                                                            -------------------     -------------------    -------------------
                                                              Shares   Amount         Shares   Amount        Share     Amount
                                                            -------------------     -------------------    -------------------
<S>                                                         <C>       <C>           <C>       <C>          <C>      <C>
Balance, January 1, 1998                                         750   $    8          1,000   $   10           50   $      1

Series A Preferred issued in connection with
  a private placement, net of expenses                           500        5
Stock issued as settlement of contract disputes
Exercise of stock options
Stock issued for acquisition of marketing contract
Stock issued for services
Issuance of common stock in private placement
Conversion of Series A Preferred Stock                          (350)      (4)
Redemption of Series A Preferred Stock                        (1,351)     (13)
Issuance of warrants
Preferred stock dividends                                        451        4
Net loss
                                                            --------  -------       --------  -------      -------  ---------
Balance,  December 31, 1998                                       -        -           1,000       10           50          1


Exercise of stock options
Issuance of common stock for debt
Issuance of options
Contribution to paid-in capital of Hollywood
    Partners.com, Inc.
Contribution to paid-in capital by shareholder
Net loss
                                                            --------  -------       --------  -------      -------  ---------
Balance, December 31, 1999                                            $     -          1,000  $    10           50  $       1
                                                            ========  =======       ========  =======      =======  =========

<CAPTION>


                                                               Common Stock         Additional
                                                           -------------------       Paid-In        Accumulated
                                                            Shares     Amount        Capital          Deficit           Total
                                                           --------   --------     -----------     -------------      ---------
<S>                                                       <C>         <C>          <C>             <C>                <C>
Balance, January 1, 1998                                  6,683,853    $   668     $23,160,507      $(20,883,197)     $2,277,997

Series A Preferred issued in connection with
  a private placement, net of expenses                                                 498,995                           499,000
Stock issued as settlement of contract disputes             115,000         12          94,176                            94,188
Exercise of stock options                                   239,500         24         213,634                           213,658
Stock issued for acquisition of marketing contract           60,000          6          43,118                            43,124
Stock issued for services                                   436,500         44         402,149                           402,193
Issuance of common stock in private placement             1,000,000        100         249,900                           250,000
Conversion of Series A Preferred Stock                    3,521,575        352            (348)                                -
Redemption of Series A Preferred Stock                                              (1,505,007)                       (1,505,020)
Issuance of warrants                                                                   278,600                           278,600
Preferred stock dividends                                                              629,144          (629,148)              -
Net loss                                                                                              (4,258,005)     (4,258,005)
                                                         ----------   --------    ------------      ------------     -----------
Balance,  December 31, 1998                              12,056,428      1,206      24,064,868       (25,770,350)     (1,704,265)



Exercise of stock options                                 3,698,687        370         552,336                          552,706

Issuance of common stock for debt                         1,732,173        173         680,839                          681,012

Issuance of options                                                                    423,306                          423,306

Contribution to paid-in capital of Hollywood
    Partners.com, Inc.                                                               1,376,372                        1,376,372

Contribution to paid-in capital by shareholder                                                         1,300,925      1,300,925

Net loss                                                                                              (1,058,591)    (1,058,591)
                                                         ----------   --------    ------------      ------------    -----------
Balance, December 31, 1999                               17,487,288   $  1,749    $ 28,398,646      $(26,828,941)   $ 1,571,465
                                                         ==========   ========    ============      ============    ===========
</TABLE>

See accompanying summary of accounting policies and notes to the consolidated
                             financial statements

                                      F-6
<PAGE>


               VITAFORT INTERNATIONAL CORPORATION & SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                                          December 31,
                                                                                                     1999              1998
                                                                                                     --------------------------
<S>                                                                                                  <C>            <C>
Increase (Decrease) in Cash and Cash Equivalents

Cash flows from operating activities:
  Net loss                                                                                           $ (1,058,591)   $ (4,258,005)
  Adjustments to reconcile net loss to cash and cash equivalents used in operating activities
  Gain on exchange of subsidiary stock                                                                 (1,521,482)
  Extraordinary gain on extinguishment of debt                                                           (385,609)              -
  Depreciation and amortization                                                                            63,463         237,410
  Allowance for doubtful accounts                                                                          43,479          16,032
  Write-off of related party receivable                                                                         -         104,290
  Loss on disposal of fixed assets                                                                              -          42,559
  Minority interest in net loss of consolidated subsidiary                                               (364,341)              -
  Stock and options issued for services                                                                   564,594         261,706
  Other                                                                                                  (102,060)        (37,859)
  Changes in operating assets and liabilities
   (Increase) decrease in:
    Accounts receivable, net                                                                              746,391        (210,204)
    Inventories                                                                                          (388,805)         56,008
    Prepaid expenses and other current assets                                                            (255,345)        152,618
    Other assets                                                                                         (160,175)           (875)
   Increase (decrease) in

    Accounts payable                                                                                      243,338          66,358
    Accrued expenses                                                                                      708,995               -
                                                                                                     ----------------------------
     Cash and cash equivalents used in operating activities                                            (1,866,148)     (3,569,962)
                                                                                                     ----------------------------

Cash flows from investing activities
  Purchase of equipment                                                                                  (151,646)        (35,884)
  Proceeds from disposal of equipment                                                                           -          73,516
  Customer acquisition costs                                                                                    -        (109,872)
  Advances to Global International                                                                              -        (285,386)
  Purchase of marketable securities                                                                    (1,000,000)              -
  Proceeds from sale of marketable securities                                                             681,570               -
  Cash acquired through acquisition of Global International Sourcing                                            -          75,462
                                                                                                     ----------------------------
     Cash and cash equivalents used in investing activities                                              (470,076)       (282,164)
                                                                                                     ----------------------------

Cash flows from financing activities:
  Proceeds from issuance of stock                                                                         125,000         499,000
  Contribution to equity of subsidiary by a shareholder                                                 2,000,000               -
  Proceeds from redemption of preferred stock                                                                   -      (1,505,020)
  Proceeds from issuance of subsidiary preferred stock                                                    300,000               -
  Proceeds from convertible note payable                                                                  375,000         600,000
  Repayment of convertible note payable                                                                  (375,000)              -
  Proceeds from notes payable-bank                                                                              -       2,025,818
  Repayment of notes payable-bank                                                                        (283,690)     (1,802,886)
  Proceeds from long-term debt                                                                                  -       2,065,000
  Proceeds from notes payable-other                                                                       822,553       1,047,262
  Repayments of notes payable-other                                                                      (412,135)       (372,435)
                                                                                                     ----------------------------
     Cash and cash equivalents provided by financing activities                                         2,551,728       2,556,739
                                                                                                     ----------------------------

Increase (decrease) in cash and cash equivalents                                                          215,504      (1,295,387)
Cash and cash equivalents, beginning of period                                                            903,649       2,199,036
                                                                                                     ----------------------------
Cash and cash equivalents, end of period                                                             $  1,119,153     $   903,649
                                                                                                     ============================

Supplemental disclosure of cash flow information
  Cash paid during the period for:
   Interest                                                                                          $    366,609     $   175,079
   Income taxes                                                                                            3,534            3,407

Supplemental disclosure of non-cash operating, investing and financing activities
   Stock issued for accounts and notes payable                                                       $   208,197     $    132,988
   Stock issued for prepaid consulting services                                                           38,619            7,500
   Options issued for prepaid consulting services                                                        140,753                -
   Stock issued for repayment of debt                                                                    543,775                -
   Stock issued upon cashless exercise of options                                                              -          213,658
   Stock issued as settlement of contract dispute                                                              -           94,188
   Stock issued for acquisition of marketing contract                                                          -           43,124
   Stock issued in exchange for marketable securities                                                          -          250,000
   Write-off of noncash financing charge                                                                 220,300                -
   Stock exchanged in repayment of debt                                                                1,521,225                -
   Acquisition of Global International Sourcing:
          Assets acquired, net of cash                                                                         -          535,786
          Liabilities assumed, including $522,328 due to Vitafort                                              -          829,461
          Contribution to equity of subsidiary by shareholders allocated to minority interest          1,018,492                -
</TABLE>


See accompanying summary of accounting policies and notes to the consolidated
                             financial statements.

                                      F-7


<PAGE>

              VITAFORT INTERNATIONAL CORPORATION AND SUBSIDIARIES
                        SUMMARY OF ACCOUNTING POLICIES

BASIS OF CONSOLIDATION

     The accompanying consolidated financial statements of Vitafort
International Corporation (the "Company") include the accounts of the Company
and its subsidiaries: Visionary Brands, Inc., Hollywood Partners.com, Inc.
(57.5% owned); Global International Sourcing, Inc. (Global) (100% owned);
Nutrifish Corporation (90.5% owned); and Crystal Clear Farms (100% owned).
Nutrifish Corporation and Crystal Clear Farms are inactive subsidiaries. All
material intercompany accounts and transactions have been eliminated.

USE OF ESTIMATES

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

CASH AND CASH EQUIVALENTS

     Cash and cash equivalents are investments with original maturities of three
months or less and short-term, highly liquid investments that are both readily
convertible to known amounts of cash and are so near their maturity that they
present insignificant risk of changes in value because of changes in interest
rates.

MARKETABLE SECURITIES

     The Company has classified its entire investment portfolio as available-
for-sale in accordance with the provisions of SFAS No. 115, "Accounting for
Certain Investments in Debt and Equity Securities". Available-for-sale
securities are stated at fair value with unrealized gains and losses included in
shareholders' equity. The amortized cost of debt securities is adjusted for
amortization of premiums and accretion of discounts to maturity. Such
amortization is included in interest income. Realized gains and losses are
included in other income (expense). The cost of securities sold is based on the
specific identification method.

INVENTORY

     Inventory consists of merchandise available for sale, packaging supplies
and raw materials, and are stated at the lower of cost (first-in, first-out) or
market.

EQUIPMENT

     Equipment is comprised of manufacturing equipment, furniture, office
equipment and computer equipment and is recorded at cost.  Depreciation is
computed on a straight-line basis over the estimated useful life not in excess
of five years.


ADVERTISING

     General costs are expenses as incurred or prepaid until the advertisement
is published, at which time the related costs are expensed.

                                      F-8
<PAGE>

OTHER INTANGIBLE ASSETS

     Intangible assets are composed of acquisition costs of Auburn Farms and
Natures Warehouse trademarks, debt issuance costs and customer acquisition costs
and are recorded at cost.  The acquisition costs associated with trademarks are
being amortized on a straight-line basis over twenty years.  All other
intangible assets are being amortized on a straight-line basis over periods not
exceeding five years.

     These costs are reviewed by management periodically and written down if
necessary to the value of the future benefit expected to be derived.


REVENUE RECOGNITION

     Product sales and related costs are recognized when the Company's products
are shipped from the commercial warehouse used by the Company or the contract
manufacturer to the customer.


IMPAIRMENT OF LONG-LIVED ASSETS

     Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of"
("SFAS No. 121") establishes guidelines regarding when impairment losses on
long-lived assets, which include plant and equipment and certain identifiable
intangible assets, should be recognized and how impairment losses should be
measured.  The Company periodically reviews such assets for possible impairment
and expected losses, if any, are recorded currently.


INCOME (LOSS) PER SHARE

     Statement of Financial Accounting Standards No. 128, "Earnings per Share"
("SFAS 128") provides for the calculation of basic and diluted earnings per
share.  Basic earnings (loss) per share includes no dilution and is computed by
dividing income available to common shareholders by the weighted average number
of common shares outstanding for the period.  Diluted earnings per share
reflects the potential dilution of securities that could share in the earnings
of an entity, such as stock options, warrants or convertible debentures.


INCOME TAXES

     Income taxes are accounted for under the asset and liability method.
Deferred tax assets and liabilities are recognized for future tax consequences
attributable to differences between the financial statement carrying amounts of
existing assets and liabilities and their respective tax bases.  Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected to
be recovered or settled.  A valuation allowance is provided when management
cannot determine whether or not it is more likely that the net deferred tax
asset will be realized.  The effect on deferred tax assets and liabilities of a
change in the rates is recognized in income in the period that includes the
enactment date.

                                      F-9
<PAGE>

FAIR VALUE OF FINANCIAL INSTRUMENTS

     The Company has cash and cash equivalents, receivables and accounts payable
for which the carrying value approximates the fair value due to the short-term
nature of these instruments.

     The fair value of long-term debt due to shareholder cannot be estimated due
to its related party nature.

     The fair value of the Company's debt instruments is based on the quoted
market prices for the same or similar issues or on the current rates offered to
the Company for debt of the same remaining maturities.


STOCK COMPENSATION

     Statement of Financial Accounting Standards No. 123, "Accounting for Stock-
Based Compensation" ("SFAS 123") allows an entity to elect to continue to
measure compensation cost under Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" ("APB No. 25"), but requires pro
forma disclosures of net earnings and earnings per share as if the fair-valued-
based method of accounting had been applied.  In accordance with FASB 123, the
Company elected to continue to measure compensation cost under APB No. 25, and
comply with the pro forma disclosure requirements.


COMPREHENSIVE INCOME

     Statement of Financial Accounting Standard No. 130, "Reporting
Comprehensive Income," ("SFAS 130") establishes standards for reporting and
display of comprehensive income and its components in a full set of general-
purpose financial statements.  The Company did not have any components of other
comprehensive income for the years ended December 31, 1999 and 1998, as such,
comprehensive loss and net loss are equivalent.


DISCLOSURES ABOUT SEGMENTS OF AN ENTERPRISE AND RELATED INFORMATION

     Statement of Financial Accounting Standards No. 131, "Disclosures about
Segments of an Enterprise and Related Information" ("SFAS 131") requires that
public companies report certain information about operating segments, products,
services and geographical areas in which they operate and their major customers.
The Company operates in one business segment.

                                     F-10
<PAGE>

              VITAFORT INTERNATIONAL CORPORATION AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1 - THE COMPANY

   Vitafort International Corporation (the "Company") was incorporated on
September 28, 1989 in the State of Delaware to succeed to the business of a
California corporation of the same name which was organized on February 7, 1986.
The Company is presently engaged in sourcing, developing and formulating
products that it sells and markets under brands for healthy products, for
licensed products and for low-priced sourced products.


NOTE 2 - LIQUIDITY AND GOING CONCERN

   For the past several years, the Company has suffered recurring losses from
operations. For the year ended December 31, 1999, the Company incurred a net
loss of $1,058,591, has working capital of $1,406,258 and stockholders' equity
of $1,571,465 as compared to a net loss of $4,258,005, negative working captial
of $(615,028) and a stockholders' deficit of $(1,704,265) at December 31, 1998.
Although the Company raised additional capital in 1999 and converted debt or
accounts payables and paid expenses of $3,205,000 with issuances of equity (see
Note 10), it has not generated sufficient revenue-producing activity to sustain
its operations. Accordingly, there is substantial doubt regarding the Company's
ability to continue as a going concern. The Company is attempting to raise
additional capital to meet future financial obligations, but may not be able to
do so. Should the Company not be able to raise additional capital, it may have
to severely curtail operations. The financial statements do not include any
adjustments that may be necessary if the Company is unable to continue as a
going concern.

     During the current and prior year, the Company reduced its cost of sales by
sourcing the manufacturing of a significant amount of its products from Mexico
to obtain lower rates than compared with domestic manufacturers. The Company has
also introduced both new and reformulated products in 1999 and plans to
introduce new products in 2000. These steps, coupled with improvements in
subcontract manufacturing quality control and quality assurance and monitoring
improvements in Company internal control and communications with respect to
product returns and deductions, management believes should improve the Company's
prospects to achieve profitability. However, no assurances can be given that the
Company will be successful in its plans.


NOTE 3 - INVENTORY

   Inventory consists of the following:

<TABLE>
<CAPTION>
                                     December 31,
                                   1999       1998
                                 ---------  ---------
   <S>                           <C>        <C>

   Finished goods                 $352,847   $118,524
   Packaging and raw material      232,560     78,079
                                  --------   --------
                                  $585,407   $196,603
                                  ========   ========
</TABLE>

                                     F-11
<PAGE>

NOTE 4 - INTANGIBLE ASSETS

     Intangible assets consists of the following:

                                                       December 31,
                                                   1999           1998
                                                   ----           ----
     Auburn Farms trademarks                    $ 311,254      $ 311,254
     Customer acquisition costs                         -         76,167
     Deferred financing costs                           -        278,600
     Distribution rights                           93,686         93,686
     Goodwill                                     218,213        218,213
                                                ---------      ---------
                                                  623,153        977,920

     Less accumulated amortization                 96,297         66,236
                                                ---------      ---------

       Total intangible assets                  $ 526,856      $ 911,684
                                                =========      =========

NOTE 5 - ACCRUED EXPENSES

     Accrued expenses consist of the following:

                                                       December 31,
                                                   1999           1998
                                                   ----           ----
     Accrued compensation                       $ 284,119      $  32,709
     Accrued interest payable                      21,903         46,468
     Accrued royalties                            103,036         51,126
     Other accrued expenses                        60,475              -
                                                ---------      ---------
     Total accrued expenses                     $ 469,533      $ 130,303
                                                =========      =========

NOTE 6 - NOTES PAYABLE

       Bank
       ----

       In August 1996, the Company entered into a revolving credit facility with
Coast Business Credit ("Bank") that provided a credit line of up to $4,000,000
subject to certain covenants.  Advances made to the Company under the facility
were based on a certain percentage of eligible accounts receivable, as defined,
and a certain percentage of eligible inventory, as defined. In June 1999, the
Company paid off the balance of this line of credit, but the assets are still
collateralized.  As of December 31, 1999, the Company does not have a line of
credit.

       Other
       -----

       During 1999, the Company exchanged 230,371 shares of its subsidiary,
Hollywood Partners.com, Inc., to various unrelated parties in settlement of
notes payable.  The shares exchanged had minimal value on the Company's books.
As such, the Company recognized a $921,484 gain on repayment of debt.

       Throughout 1998, the Company entered into purchase order financing
agreements with accredited investors, which provided the Company with $995,000
to purchase inventory.  These advances bear interest at 3% per month and are due
as the related receivables are collected.  In addition, several lenders received
options to purchase 410,000 shares of the Company's common stock at $1.00 per
share, which was fair market value at the time.  The exercise price was later
reduced to $0.10 and $0.085 reflecting a subsequent decline in the fair market
value of the Company's common stock.  The Company has pledged its inventory as

                                      F-12
<PAGE>

collateral for these advances.  At December 31, 1999, $220,262 of these advances
were outstanding.   During 1999, the Company repaid $320,000 of these notes in
cash and repaid $250,000 plus accrued interest thereon with the issuance of
500,000 shares of the Company's common stock, having a total value of $131,750.
The difference between the fair market value of the Company's common stock
issued and the carrying value of the advances and accrued interest repaid
resulted in an extraordinary gain to the Company of $143,250.

     Convertible Notes Payable
     -------------------------

     As of December 31, 1998, convertible notes payable consisted of two notes
in the amount of $300,000 each to previous holders of the Company's Series A
Preferred Stock.  The notes were repaid in 1999 with the exchange of 150,000
shares of Hollywood Partners.com held by the Company.  The shares exchanged had
minimal value on the Company's books.  As such, the Company recognized a
$600,000 gain on repayment of debt.

     Under the terms of these notes, the Company had issued five-year warrants
to purchase 60,000 shares of common stock at $0.40 per share and 60,000 shares
of common stock at $0.25 per share.    If the notes and accrued interest are
repaid in cash, the warrants for 60,000 shares at $0.25 will be cancelled.
Otherwise, to the extent any portion of the notes and accrued interest is paid
with stock, the exercise price of a proportionate number of the 60,000 shares
will be adjusted to $0.01 per share.  The warrants were valued at the fair value
as of the date issued, which resulted in non-cash financing cost of $58,262.
This non-cash financing cost is being amortized as interest expense over the
term of the debt.

     On December 31, 1999, 150,000 shares of Hollywood Partners.com were issued
to the holders of the two convertible notes in payment of the principal amount
of $600,000. These shares are restricted pursuant to Rule 144 and bear a legend.

     On August 24, 1998, the Company issued a convertible debenture due August
24, 2000 and received proceeds in the amount of $548,352.  Interest was payable
at 6% per annum.  Repayments could be made in cash or stock at the option of the
Company.  On December 30, 1998, this note and accrued interest of $11,629 were
repaid in full from the proceeds of a related party long-term promissory note.

     Other Notes Payable
     -------------------

     During the year, the Company entered into various insurance policies
financed by notes payable which is included in "Notes payable-other." The notes
payable had a balance of $130,468 bearing interest at between 8% and 9% with
$104,137 due in the coming year.

NOTE 7 - LONG-TERM DEBT

     At December 31, 1998, the Company's long term debt consisted of a
$2,065,000 five year promissory note payable issued to a principal shareholder.
The note was due January 22, 2004 with interest at 6%, payable annually. The
note provided for the first year's interest on the note to be applied to the
partial exercise of the warrants. Under the terms of the note, the Company
issued warrants to the note holder to purchase 500,000 shares of common stock at
$0.25 per share. These warrants were valued at the fair value as at that date,
which resulted in non-cash financing cost of $220,267 to be amortized to
interest expense over the life of the note.

                                      F-13
<PAGE>

     In 1999, the Company issued 1,235,857 shares of the Company's common stock
in repayment of $543,775 of the related party long-term promissory note. The
remaining balance of $1,521,225 was forgiven by the shareholder and was recorded
as a contribution to capital by the shareholder, net of the non-cash unamortized
financing cost.

     The proceeds from this note were used to retire 1,351 shares of Series A
Preferred Stock and to repay a $548,352 note payable to a shareholder along with
accrued interest thereon of $11,628.

NOTE 8  - INCOME TAXES

     As the Company has incurred significant operating losses since inception,
its current tax provision has been limited to minimum California tax payments.
As of December 31, 1999, the Company had unused Federal and California net
operating loss carryforwards of approximately $24,932,000 and $11,732,000,
respectively, available to offset against future Federal taxable income and
future California taxable income. The unused net operating loss and credit
carryforwards expire in various amounts through the year 2019.  In contrast to
Federal net operating losses, only 50% of the California net operating losses
incurred subsequent to December 31, 1986 may be carried forward.  The California
net operating losses will expire in various amounts through the year 2004.

     Net deferred tax assets of approximately $8,829,000 resulting from net
operating losses have been offset by a valuation allowance since management
cannot determine whether it is more likely than not such assets will be
realized.

     Due to restrictions imposed by the Internal Revenue Code regarding
substantial changes in ownership of companies with loss carryforwards, the
utilization of the above-mentioned net operating losses may be limited as a
result of changes in stock ownership.  The annual utilization of these losses is
limited to an amount equal to the estimated fair value (for income tax purposes)
of the Company at the point of stock ownership change, multiplied by the long-
term tax-exempt rate then in effect.  The annual limitation has not been
quantified at this time.

NOTE 9 - STOCKHOLDERS' EQUITY

Convertible Preferred Stock

     The Company entered into two subscription agreements totaling $750,000 in
1997 with two unrelated investors for 750 shares of 1997 Series A Preferred
Stock.  The preferred stock has a cumulative dividend rate of 6% with no voting
rights.  The conversion price is the lower of $1.25 per share or a 30% discount
to the market price at the time of conversion.  The preferred stock is
convertible at any time.  For accounting purposes, the original issue discount
of $305,749 is being treated as a deemed dividend.  The facilitators received a
10% fee from the proceeds, as well as warrants to purchase 52,500 shares of
common stock at an exercise price of $1.00 per share.

     The Company entered into a subscription agreement in March 1998 with an
unrelated investor for $500,000 for 500 shares of 1997 Series A Preferred Stock.
The preferred stock has a cumulative dividend of 6% with no voting rights.  The
preferred stock is convertible beginning August 10, 1998 at a 21.5% discount if
the fair market value of the stock on the date of conversion is $0.6875 per
share or less.  If the fair market value of the stock on the date of conversion
is more than $0.6875 per share, the preferred stock is convertible at fair
market value.  However, if the preferred shares are converted at fair market
value, the preferred shareholder will receive sufficient warrants upon
conversion to purchase common stock at $0.6875 per share to generate a $275
profit per share of preferred stock converted.

                                      F-14
<PAGE>

     As part of the above transaction, the Company also issued 451 shares of
preferred stock, as well as warrants to purchase 282,422 shares of common stock
at $0.6875 per share to the holders of the 1997 Series A Preferred Stock in
exchange for the preferred stockholders accepting an adjustment in the terms of
the 1997 Series A Preferred Stock.  The warrants may be exercised over a five-
year period beginning August 10, 1998.

     For accounting purposes, the issuance of the warrants to the 1997 Series A
Preferred stockholders resulted in a deemed dividend of $147,381.

     The modified terms of the 1,701 total shares of 1997 Series A Preferred
Stock outstanding resulted in an issuance of 787,563 warrants to purchase shares
of common stock.  The value of these potential warrants issued is reflected as
an original issued discount of $411,128 at the time of the transaction.  This
original issue discount is being treated as a deemed dividend.

     During the last quarter of 1998, the holders of 350 shares of the 1997
Series A Preferred Stock elected to convert said shares into 3,251,575 shares of
common stock under the terms of the subscription agreement.

     The Company repurchased the remaining 1,351 shares of the 1997 Series A
Preferred Stock for $1,505,020 from the proceeds of long term related party
promissory note.  There was no 1997 Series A Preferred stock outstanding at
December 31, 1999.

     Each share of Series B 10% Cumulative Convertible Preferred stock is
convertible into 1.667 shares of common stock, and cumulative convertible
dividends of 10% per annum are payable annually commencing October 1992.  The
Series B 10% Cumulative Preferred stock has a liquidation preference of $50 per
share plus all accrued and unpaid dividends.  It is subject to optional
redemption by the Company at any time at $50 per share plus accrued and unpaid
dividends.  Cumulative unpaid dividends amounted to $42,500 and $39,000 at
December 31, 1999 and 1998, respectively.

     Each share of Series C Convertible Preferred Stock is convertible into 100
shares of common stock and 100 warrants.  Series C Convertible Preferred Stock
does not carry any dividend rights.  The warrants expired in June 1994.
Additionally, the Series C Convertible Stock has a dilutive conversion factor.
The Series C Convertible Preferred Stock has a liquidation preference of $1,000
per share after Series B Cumulative Convertible Preferred Stock, and to holders
of common stock.

     The shares of Series B and Series C Preferred stock are not currently
registered under the Securities Exchange Act of 1934.

Common Stock

     In March 1999, the Company issued 10,000 shares of common stock at $.50 per
share to a previous employee in payment of accrued vacation.

     In June 1999, the Company issued 160,000 shares of common stock at $.10 per
share in exchange for services rendered, previously recorded as a liability.

     In the second quarter of 1999, various employees exercised 106,529 options
at $.085 per share and 850,000 options at $.10 per share to purchase common
shares.

     In July 1999, a shareholder exercised options to purchase 500,000 shares of
common stock at $.25 per share.

                                      F-15
<PAGE>

     In August 1999, the Company issued 26,316 shares of common stock at $.085
per share in exchange for services rendered, previously recorded as a liability.

     In September 1999, the Company issued 1,235,857 shares of common stock at
$.44 per share to convert $543,775 of convertible debt held by a shareholder to
equity. The remaining balance of this convertible debt of $1,521,225 was
forgiven and has been reflected as a contribution to capital by the shareholder
net of associated unamortized non-cash financing costs.

     In the third quarter of 1999, the Company entered into a settlement
agreement with an individual owed $250,000 plus accrued interest. In accordance
with this agreement, the Company issued 500,000 shares of common stock to settle
all amounts owed. Of this amount, 200,000 shares of common stock related to
options granted to this individual, 150,000 at $.085 per share and 50,000 at
$.10 per share. The remaining shares were valued at the then market value of
$.38 per share.

     Throughout 1999, the Company issued 2,042,158 shares of common stock upon
exercise of options granted to consultants and vendors of the Company as payment
for services rendered or amounts owed as follows:

     - 49,971 shares at an exercise price of $.085 per share.

     - 1,613,187 shares at an exercise price of $.10 per share.

     - 10,000 shares at an exercise price of $.25 per share.

     - 40,000 shares at an exercise price of $.50 per share.

     - 4,000 shares at an exercise price of $1.00 per share.

     - 325,000 shares at an average exercise price of $.38 per share.

     In January 1998, the Company issued 85,000 shares of common stock at a
value of $1.00 per share as settlement for contract disputes previously recorded
as a liability.

     In February 1998, the Company issued 30,000 shares of common stock at a
value of $.30625 per share as settlement of a contract dispute related to
consulting services previously recorded as a liability.

     In February 1998, the Company issued 60,000 shares of common stock at a
value of $.71875 per share and forgave a $25,000 note receivable from an
unrelated company in exchange for its distribution rights with respect to
marshmallow products in North America.  The Company also received $5,000 of
sample inventory and $15,000 of furniture and equipment as part of this
transaction.

     In February 1998, the Company issued 100,000 shares of common stock at a
value of $0.74 per share upon the exercise of an option granted a consultant in
exchange for future consulting services.

     In March 1998, the Company issued 15,000 shares of common stock at a value
of $1.00 per share upon the exercise of an option granted a consultant in
exchange for services rendered previously recorded as a liability.

     In April and July 1998, the Company issued a total of 87,000 shares of
common stock at a value of $1.00 per share upon the exercise of options granted
to a consultant in exchange for consulting services.

                                      F-16
<PAGE>

     In May 1998, the Company issued 37,500 shares of common stock at a value of
$1.004 per share upon the exercise of an option granted a previous employee as
part of a litigation settlement.

     In June 1998, the Company issued 174,500 shares of common stock at a value
of $1.00 per share under an S-8 filing as payment for services rendered and to
be rendered.

     In July 1998, the Company issued an additional 60,500 shares at values
averaging $.80 per share under the S-8 filing as payment for services rendered
and to be rendered.

     During 1998, the Company issued 29,500 shares of common stock at a value of
$1.00 per share to various consultants and professional firms for previous
services rendered.

     In July 1998, the Company issued 20,000 shares of common stock at a value
of $.94 per share to a consultant in payment of services rendered.

     In August 1998, the Company issued 125,000 shares of common stock to
officers at a value of $1.00 per share in payment of accrued bonuses.

     In August 1998, the Company issued 7,000 shares of common stock at a value
of $.86 per share to a consultant in payment of services rendered.

     In December 1998, the Company issued 352,575 shares of common stock upon
the conversion of 350 shares of 1997 Series A Preferred Stock.

     In December 1998, the Company sold 1,000,000 shares of common stock to
Terra Healthy Living, a principal shareholder, for $250,000 (or $.25 per share)
which was paid by delivery to the Company of marketable Swiss securities.  The
Company believes that the price paid for such shares was no less favorable to
the Company than that which would have been paid by an unaffiliated purchaser.

     Contribution to Capital
     -----------------------

     During 1999, a shareholder of Hollywood Partners.com, Inc. contributed
approximately $2 million in cash to Hollywood Partners.com, Inc.  Accordingly,
the Company recorded its proportionate share of the contribution as a
contribution to paid in capital Hollywood Partners.com.

NOTE 10 - STOCK OPTIONS

     The 1989 Stock Option Plan, as amended (the "Plan") reserved 50,000 shares
of common stock (as adjusted for the reverse split effected in 1996) to grant
either nonqualified or incentive stock options.  All directors, officers, key
employees and consultants to the Company or its subsidiaries are eligible under
the terms of the Plan.  Such options may not be granted at less than 100% of the
fair market value at the date of grant (110% for an owner of 10% or more of the
outstanding stock).  Upon termination of service, the options, which an
individual was entitled to exercise at the date of termination may be exercised
at any time within six months of such termination.  If an employee is terminated
with cause, the options are canceled upon termination.  As of December 31, 1999,
no options are outstanding under this plan.

     In 1995, the Company adopted the 1995 Stock Option Plan (the "1995 Plan")
pursuant to which 2,000,000 shares of Common Stock (as adjusted for the reverse
stock split effected in 1996) were reserved for issuance upon the exercise of
options.  The 1995 Plan is similar to the 1989 Plan in many respects and in the
discussion below, each is referred to as a "Plan" and they are collectively
referred to as the "Plans".

                                      F-17
<PAGE>

     The Company has also granted stock options outside the Plans to other
individuals, such as employees and consultants, in consideration for services
performed. The options were granted at fair market value and at various terms
and vesting periods. The following table on the next page summarizes all option
activity for the years ended December 31, 1999 and 1998:

                       Number of Common Stock Options    Weighted
                         1995 Stock      Other Stock     Average
                         Option Plan       Options        Price
                         -----------     -----------      -----
Outstanding as of
  January 1, 1998          1,231,708       3,885,982     $   1.55
Granted and repriced               -       6,755,528          .48
Exercised                          -        (239,500)         .89
Canceled                           -      (2,328,970)        2.01
                         -----------     -----------     --------

Outstanding as of
  December 31, 1998        1,231,708       8,073,040     $    .66
Granted                            -       8,411,000          .27
Exercised                          -      (3,698,687)         .51
Canceled                           -      (1,254,000)         .51
                         -----------     -----------     --------

Outstanding as of
  December 31, 1999        1,231,708      11,531,353     $    .50
                         ===========     ===========     ========

Exercisable as of
  December 31, 1999        1,231,708       6,991,867     $    .61
                         ===========     ===========     ========

     FASB Statement 123, "Accounting for Stock-Based Compensation," requires the
Company to provide pro forma information regarding net income and earnings per
share as if compensation cost for the Company's stock option plans had been
determined in accordance with the fair value based method prescribed in FASB
Statement 123. The Company estimates the fair value of each stock option, using
the Black-Scholes method, at the weighted-average assumption used for grants in
fiscal 1999 and 1998 dividend yield of zero percent; expected volatility of 188
percent and 371 percent, respectively; risk-free interest rate of six and eight
percent, respectively; and an expected life of three to five years.

     The weighted average fair value of options granted during 1999 and 1998 was
$.25 and $.41, respectively.

     Under the accounting provisions of FASB Statement 123, the Company's net
loss and loss per share for 1999 and 1998 would have been reduced to the pro
forma amounts indicated below:


               Net loss                          1999           1998
               ----------------------------------------------------------
               As reported                    $(1,058,591)   $(4,887,153)
               Pro forma                      $(1,327,923)   $(4,904,346)

               Basic loss per share
               --------------------

               As reported                    $      (.07)   $      (.66)
               Pro forma                      $      (.09)   $      (.66)


                                      F-18
<PAGE>

     Due to the fact that the Company's stock option programs vest over many
years and additionally awards may be made each year, the above pro forma numbers
are not indicative of the financial impact had the disclosure provisions of FASB
123 been applicable to all years of previous grants.  The numbers above do not
include the effect of options granted prior to 1995 that vested in 1996 and
1997.

     The following table summarizes information about stock options outstanding
at December 31, 1999:

<TABLE>
<CAPTION>
                                        Options
                                      Outstanding                           Options Exercisable
                                                                            -------------------
                         Number     Weighted-Average                      Number        Weighted
   Range of            Outstanding     Remaining      Weighted-Average  Exercisable     Average
Exercisable Prices     At 12/31/99  Contractual Life   Exercise Price   at 12/31/99  Exercise Price
------------------     -----------  ----------------  ----------------  -----------  --------------
<S>                    <C>          <C>                <C>              <C>          <C>
$ 0.085 - $0.75         9,946,188        2.61             $ 0.22          5,556,702        $ 0.19
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
$ 0.875 - $2.80         2,552,748        1.12               1.04          2,502,748          1.05
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
$ 3.00  - $7.50           232,375          .9               3.62            132,875          3.90
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
$10.00 - $20.00            31,250        7.93              11.76             31,250         11.76
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
Totals                 12,763,061        2.36             $ 0.50          8,223,575        $ 0.61
------------------=================================================================================
---------------------------------------------------------------------------------------------------
</TABLE>


NOTE 11 - COMMITMENTS

Lease Agreement

     As of August 1, 1999, the Company entered into a two-year lease agreement
for its office premises. The Company is obligated for a monthly rent of  $8,800
through May 31, 2000 and $8,950 per month for the period June 1, 2000 through
May 31, 2001.

     Rent expense for the years ended December 31, 1999 and 1998 including
parking, included in selling, general and administrative expenses, was $118,686
and $138,627, respectively.


Employment Agreements

     In September 1997, Mr. Beychok, the Company's current Chairman of the
Board, entered into a new employment agreement ("Agreement") with the Company
for three years. Under the Agreement, Mr. Beychok receives an annual base salary
of $150,000 and was granted options for 450,000 shares of stock at an exercise
price of $0.87 per share, all of which are currently vested. In September 1997
Mr. Beychok was given a successful litigation reward of $51,535 plus 100,000
shares of common stock at fair market value of $1.00. In November 1998 the price
of all options other than those related to the private placement were repriced
to $0.10. In August 1999, Mr. Beychok was given a successful litigation reward
of $75,000. In October 1999 Mr. Beychok was granted a new Board of Director
package of an option to purchase 500,000 shares at an exercise price of $.25 per
share, the then fair market value, vesting 166,667 shares on October 22, 1999,
166,667 shares on October 22, 2000 and 166,666

                                      F-19
<PAGE>

shares on October 22, 2001. In October 1999, the Board granted Mr. Beychok an
option for 900,000 shares at an exercise price of $.25 per share, the then fair
market value, vesting 450,000 on October 22, 1999, 225,000 on October 22, 2000,
and 225,000 on October 22, 2001.

     In September 1997, Mr. Coppolino, the Company's current President, was
given a successful litigation reward of $25,000, forgiveness of debt of $25,000,
plus 25,000 shares of common stock at $1.00, being the fair market value at the
date of the award. In November 1998 the price of all options were repriced to
$0.10. In August 1999, Mr. Coppolino was given a successful litigation reward of
$50,000. In October 1999, Mr. Coppolino was granted a Board of Director package
of an option to purchase 375,000 shares at an exercise price of $.25 per share,
the then fair market value, vesting 125,000 shares on October 22, 1999, 125,000
shares on October 22, 2000 and 125,000 shares on October 22, 2001. In October
1999, the Board granted Mr. Coppolino an option for 750,000 shares at an
exercise price of $.25 per share, the then fair market value, vesting 375,000 on
October 22, 1999, 187,500 on October 22, 2000, and 187,500 on October 22, 2001.
In December 1999, Mr. Coppolino entered into a new employment agreement
("Agreement") with the Company for three years. Under the Agreement, Mr.
Coppolino receives an annual base salary of $150,000 effective January 2000.

NOTE 12 - MAJOR CUSTOMERS

     The Company derived the following revenue from major customers, each of
which provided 10% or more of total revenues during the year ended December 31,
1999 and 1998:

                                1999       1998
                              --------  ----------

  Wal-Mart                    $533,620  $  585,813
  Bi-Lo                        281,636           -
  A-1 International, Inc.       45,820     532,422
                              --------  ----------

   Total                      $861,076  $1,118,235
                              ========  ==========

NOTE 13 - LITIGATION

     The Company is a party to legal proceedings which generally relate to
disputes between the Company and its suppliers or customers regarding payment
for products sold or supplied and are typical for a company of its size and
scope and financial condition. None of these proceedings are believed to be
material to its financial condition or results of operations.


NOTE 14 - RELATED PARTY TRANSACTIONS

     The Company has entered into related party transactions during 1999 and
1998. See Notes 6, 7, 9 and 15 for further detailed information.


NOTE 15 - MARKETABLE SECURITIES

     The Company owns 2,050 shares of Triple Tree Trust AG, a publicly traded
Swiss corporation (TTT-SW), an affiliate of a related party.  The marketable
securities carrying amount and fair market value is $514,150 at December 31,
1999.  The Company has recorded no realized or unrealized gain or loss on these
securities.

     The carrying amount and fair value of other marketable securities (based on
quoted market prices) available-for-sale at December 31, 1999 amounted to
$22,517.

                                      F-20
<PAGE>

NOTE 16 - LITIGATION RECOVERY, NET OF COSTS

     On August 3, 1999, the Company entered into litigation settlement
agreements with Barbara's Bakery, Inc. ("Barbara's Bakery"), New Life Bakery,
Inc. ("New Life"), Gil Pritchard, David Marson, James Marson, and Kim Walters
(collectively the "Defendants") and resolved the Company's disputes with its
insurers over coverage for Defendants' counterclaims against the Company and
Mark Beychok.  The lawsuit alleged that Barbara's Bakery had violated the
Federal Lanham Act, and the California Unfair Competition Act, by improperly
marketing toaster pastries, fruit juice sweetened cookies, and fig bars, and
that New Life Bakery had breached an agreement with Auburn Farms, Inc., whose
claims Vitafort purchased in 1996.  Barbara's Bakery further agreed to withdraw
from the toaster pastry business by discontinuing its Nature's Choice Toaster
Pastry line by no later than November 30, 1999.  Vitafort had secured up to
$800,000 in off balance sheet financing for the litigation against New Life and
Barbara's Bakery, including $600,000 from an investment partnership, Auburn
Farms Vindication Partners, LLC, for the purpose of paying the legal fees and
expenses of the pending litigation.  The fee arrangement included a limited,
partial contingency arrangement with the Chicago-based law firm of Jenner &
Block.  After paying attorneys' fees and making payments to outside investors
who funded the litigation, the Company has received approximately $1,260,000.

NOTE 17 - FINANCING AGREEMENTS

     Effective December 30, 1998, the Company completed the closing under a
series of agreements including a Common Stock Purchase Agreement (the "CSPA"),
dated as of December 30, 1998, by and among the Company; Terra Healthy Living,
Ltd., a B.V.I. corporation ("Terra"); Sovereign Partners Limited Partnership, a
Connecticut limited partnership ("Sov"); and Dominion Capital Fund, Ltd., a
Bahamian corporation ("Dom").  Pursuant to the CSPA and the related documents:

     Terra acquired 2,712,843 shares of the Company's common stock from Sov and
Dom for $235,000.  Such shares were issued by the Company upon the conversion by
Sov and Dom of an aggregate of 235 shares of the Company's 1997 Series A
Convertible Preferred Stock ("Series A Preferred").

     The Company borrowed $2,065,000 from Terra pursuant to a promissory note
with warrant and registration rights (the "Terra Note").  The Terra Note is a
five-year note bearing interest at 6% per annum.  Interest on the Terra Note is
payable annually.  The Terra Note provides for the issuance to Terra of a five
year warrant (the "Terra Warrant") for the purchase of 500,000 shares of the
Company's common stock at $.25 per share.  The Terra Note further provides that
the first year's interest on the Terra Note shall be applied to the partial
exercise of the Terra Warrant.

     The Company applied the $2,065,000 proceeds of the Terra Note to redeem all
1,351 remaining shares of Series A Preferred held by Sov and Dom, as well as a
convertible debenture in the amount of $548,352 held by Dom.

     The aggregate of $2,300,00 paid by Terra in connection with its purchase of
the 2,712,843 shares of the Company's common stock from Sov and Dom and in
connection with the Terra Note was satisfied through the delivery to Sov and Dom
of marketable securities having a value of $2,300,000.  Under the CSPA, Terra
made certain assurances to Sov and Dom and assumed certain obligations to assure
that Sov and Dom would realize $2,300,000 on the sale of the marketable
securities.

     The Company borrowed $300,000 from each of Sov and Dom pursuant to a non-
negotiable nine month promissory note bearing interest at 8% per annum (the "Sov
Note" and the "Dom Note").  These notes provide for their repayment, at the
option of the Company, in registered common stock of the

                                     F-21
<PAGE>

Company which shall be valued at the then market for such stock. The Sov Note
and the Dom Note provide for the issuance to each of Sov and Dom of 60,000
warrants which expire on December 31, 2003, half of which are exercisable at
$.40 and half of which are exercisable at $.25. If the Company repays the Sov
Note or the Dom Note with common stock, as provided in such notes, then the
exercise price of the $.25 warrant is reduced to $.01.

     The CSPA granted the Company the right to redeem up to 2,000,000 of the
shares of its common stock acquired by Terra through June 30, 2000, based upon a
formula related to the market price of the common stock at the time of the
redemption.

     In addition, the Company issued 571,232 shares of its common stock to Sov
in connection with Sov's prior conversion of 40 shares of Series A Preferred
Stock.


NOTE 18 - EXTRAORDINARY ITEM

     During the year ended December 31, 1999, the Company renegotiated certain
accounts payable and notes payable resulting in a reduction of the amount due.
The resulting decrease in the amounts due of $242,359, in addition to the
$143,250 gain on extinguishments of debt discussed in Note 6, is reflected as an
extraordinary gain on extinguishments of debt in the year ended December 31,
1999 statement of operations.

                                     F-22