UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________

FORM 10-Q

(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ____________ to _________________

Commission File No. 000-24657

MANNATECH, INCORPORATED
(Exact Name of Registrant as Specified in its Charter)

Texas 75-2508900
(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)

600 S. Royal Lane, Suite 200
Coppell, Texas
75019
(Address of Principal Executive Offices, including Zip Code)

Registrant's Telephone Number, including Area Code: (972) 471-7400

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

As of April 28, 2000, the number of shares outstanding of the registrant's
sole class of common stock, par value $0.0001 per share was 24,979,993.

TABLE OF CONTENTS

Page
----

Part I - FINANCIAL INFORMATION

Item 1. Financial Statements.......................................................................... 1
Consolidated Balance Sheets....................................................................... 1
Consolidated Statements of Operations............................................................. 2
Consolidated Statements of Cash Flows............................................................. 3
Notes to Consolidated Financial Statements........................................................ 4

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations......... 6
Overview.......................................................................................... 6
Results of Operations............................................................................. 8
Three months ended March 31, 2000 compared with the three months ended March 31, 1999............. 8
Liquidity and Capital Resources................................................................... 10
Year 2000......................................................................................... 12
Recent Financial Accounting Standards Board Statements............................................ 12
Forward-looking Statements........................................................................ 12

Item 3. Quantitative and Qualitative Disclosures About Market Risk.................................... 13

Part II - OTHER INFORMATION

Item 1. Legal Proceedings............................................................................. 14
Item 2. Changes in Securities and Use of Proceeds..................................................... 14
Item 3. Defaults Upon Senior Securities............................................................... 15
Item 4. Submission of Matters to a Vote of Security Holders........................................... 15
Item 5. Other Information............................................................................. 15
Item 6. Exhibits and Reports on Form 8-K.............................................................. 15

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

MANNATECH, INCORPORATED
CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)

December 31, March 31, 2000
1999 (Unaudited)
------------- ---------------

ASSETS

Cash and cash equivalents...................................... $11,576 $ 8,952
Short-term investments......................................... 1,388 948
Accounts receivable, less allowance for doubtful
accounts of $58.............................................. 275 237
Current portion of notes receivable-shareholders............... 158 215
Inventories.................................................... 13,318 14,283
Prepaid expenses and other current assets...................... 728 1,102
Deferred tax assets............................................ 564 546
------- -------
Total current assets......................................... 28,007 26,283
Property and equipment, net.................................... 14,093 14,763
Notes receivable-shareholders, excluding current portion....... 543 384
Other assets................................................... 1,231 1,169
Long-term investments.......................................... 905 710
------- -------
Total assets................................................. $44,779 $43,309
======= =======

LIABILITIES AND SHAREHOLDERS' EQUITY

Current portion of capital leases and note payable............. $ 732 $ 697
Accounts payable............................................... 1,890 1,813
Accrued expenses............................................... 13,722 12,573
------- -------
Total current liabilities.................................... 16,344 15,083
Capital leases and note payable, excluding current portion..... 326 182
Deferred tax liabilities....................................... 817 817
------- -------
Total liabilities............................................ 17,487 16,082
------- -------
Commitments and contingencies..................................

Shareholders' equity:
Preferred stock, $0.01 par value, 1,000,000 shares
authorized, no shares issued and outstanding................. -- --
Common stock, $0.0001 par value, 99,000,000 shares authorized
24,790,601 issued and 24,774,293 outstanding,
in 1999 and 24,965,601 issued and 24,949,293 outstanding
in 2000...................................................... 2 2
Additional paid-in capital..................................... 17,348 17,786
Retained earnings.............................................. 10,146 9,643
------- -------
27,496 27,431
Less treasury stock, at cost, 16,308 shares.................... (204) (204)
------- -------
Total shareholders' equity................................... 27,292 27,227
------- -------
Total liabilities and shareholders' equity................... $44,779 $43,309
======= =======

See accompanying notes to consolidated financial statements.

MANNATECH, INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 2000
(in thousands, except per share amounts)

1999 2000
------- -------

Net sales................................................. $42,616 $40,274
------- -------

Cost of sales............................................. 6,893 7,030
Commissions............................................... 17,316 16,745
------- -------
24,209 23,775
------- -------

Gross profit........................................ 18,407 16,499
------- -------

Operating expenses:
Selling and administrative expenses................. 8,472 9,947
Other operating costs............................... 5,354 7,433
------- -------
Total operating expenses...................... 13,826 17,380
------- -------

Income (loss) from operations............................. 4,581 (881)

Interest income........................................... 89 243
Interest expense.......................................... (50) (24)
Other expense, net........................................ (17) (112)
------- -------

Income (loss) before income taxes......................... 4,603 (774)

Income tax (expense) benefit.............................. (1,701) 271
------- -------

Net income (loss)......................................... $ 2,902 $ (503)
======= =======

Earnings (loss) per common share:
Basic............................................... $ 0.13 $ (0.02)
======= =======

Diluted............................................. $ 0.12 $ (0.02)
======= =======

Weighted-average common shares outstanding:
Basic.............................................. 23,114 24,781
======= =======

Diluted............................................ 24,480 24,781
======= =======
Dividends declared per common share....................... $ 0.06 $ 0.00
======= =======

See accompanying notes to consolidated financial statements.

MANNATECH, INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 2000
(in thousands)

1999 2000
------- --------

Cash flows from operating activities:
Net income (loss)............................................... $ 2,902 $ (503)
Adjustments to reconcile net income (loss) to net cash
used in operating activities:
Depreciation and amortization............................... 733 834
Tax benefit of warrants and options exercised............... 2,005 195
Deferred income tax expense................................. -- 18
Changes in operating assets and liabilities:
Accounts receivable....................................... 20 38
Inventories............................................... (1,125) (964)
Prepaid expenses and other current assets................. (191) (375)
Other assets.............................................. 36 61
Accounts payable.......................................... (3,784) (78)
Accrued expenses.......................................... (3,909) (1,148)
------- --------
Net cash used in operating activities................... (3,313) (1,922)
------- --------

Cash flows from investing activities:
Acquisition of property and equipment and construction
in progress.................................................... (411) (1,504)
Purchases of investments........................................ (101) (31)
Maturities of investments....................................... -- 667
Repayment of shareholders/related party receivables, net........ 974 102
------- --------
Net cash provided by (used in) investing activities..... 462 (766)
------- --------

Cash flows from financing activities:
Payment of dividends............................................ (1,326) --
Repayment of capital lease obligations.......................... (175) (133)
Proceeds from the initial public offering....................... 12,000 --
Proceeds from warrants and options exercises.................... 641 243
Repayment of note payable....................................... (57) (46)
Deferred offering costs......................................... (615) --
------- --------
Net cash provided by financing activities............... 10,468 64
------- --------

Net increase (decrease) in cash and cash equivalents............. 7,617 (2,624)
Cash and cash equivalents:
Beginning of period............................................. 763 11,576
------- --------
End of period................................................... $ 8,380 $ 8,952
======= ========
Supplemental disclosure of cash flow information:
Income taxes paid............................................... $ 3,464 $ -
======= ========
Interest paid................................................... $ 53 $ 24
======= ========

See accompanying notes to consolidated financial statements.

MANNATECH, INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1 ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Mannatech, Incorporated (the "Company") was incorporated in the State of
Texas on November 4, 1993, as Emprise International, Inc. Effective October 25,
1995, the Company changed its name to Mannatech, Incorporated. The Company,
located in Coppell, Texas, develops and sells proprietary nutritional
supplements and topical products through a network marketing system. The Company
currently sells its products in the United States, Canada, Australia and the
United Kingdom. Independent associates ("Associates") purchase products, at
wholesale, for the primary purpose of selling to retail consumers or for
personal consumption. In addition, Associates earn commissions on their downline
growth and sales volume.

On April 22, 1998, the Company formed a wholly-owned subsidiary, Mannatech
Australia Pty Limited for the purpose of conducting business in Australia. The
Australian subsidiary, located in St. Leonards, began operations on October 1,
1998.

On December 1, 1998, the Company formed a wholly-owned subsidiary,
Mannatech Limited, for the purpose of conducting business in the Republic of
Ireland. This subsidiary is dormant pending the start-up of operations in the
Republic of Ireland.

In April 1999, the Company formed a wholly-owned subsidiary, Mannatech
Ltd., for the purpose of conducting business in the United Kingdom as a limited
service provider. The United Kingdom subsidiary is located in Basingstoke,
Hampshire and began operations on November 15, 1999.

On May 1, 1999, the Company formed a wholly-owned subsidiary, Mannatech
Foreign Sales Corporation, under the laws of Barbados to act as a "foreign sales
corporation" as defined in the United States Internal Revenue Code.

On May 7, 1999, the Company formed a wholly-owned subsidiary, Internet
Health Group, Inc., a Texas corporation, for marketing its proprietary products,
specially developed nutritional supplements and sports nutrition products over
the Internet. Internet Health Group, Inc. operates through its website,
www.clickwell.com, which began operations on December 20, 1999.
- -----------------

On January 21, 2000, the Company formed a wholly-owned subsidiary,
Mannatech Japan, Inc. for the purpose of conducting business in Japan. The Japan
subsidiary, located in Tokyo, Japan, is planned to begin operations in the
summer of 2000.

On February 14, 2000, the Company formed a wholly-owned subsidiary,
Mannatech Limited, for the purpose of conducting business in New Zealand. This
subsidiary is dormant pending the start-up of operations in New Zealand.

The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, the accompanying unaudited
consolidated financial statements contain all adjustments, consisting of normal
recurring adjustments, considered necessary for a fair statement of the
Company's financial information as of March 31, 1999 and 2000 and for the three
months ended March 31, 1999 and March 31, 2000. The consolidated results of
operations of any interim period are not necessarily indicative of the
consolidated results of operations to be expected for the fiscal year. For
further information, refer to the consolidated financial statements and
accompanying footnotes included in the Company's annual report on Form 10-K for
the year ended December 31, 1999.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company
and its wholly-owned subsidiaries. All significant intercompany balances and
transactions have been eliminated in consolidation.

Use of Estimates

In preparing consolidated financial statements in conformity with generally
accepted accounting principles, management is required to make certain estimates
and assumptions that may affect the reported amounts of assets, liabilities,
revenues and expenses during the reporting periods. Actual results may differ
from such estimates.

Cash and Cash Equivalents

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

Inventories

Inventories consist of raw materials and finished goods and are stated at
the lower of cost (using the first-in, first-out method) or market.

Earnings (Loss) per Share

The Company calculates earnings (loss) per share pursuant to Statement of
Financial Accounting Standards No. 128, "Earnings per Share" ("FAS 128"). FAS
128 requires dual presentation of basic and diluted earnings (loss) per share
("EPS") on the face of the consolidated statement of operations for all entities
with complex capital structures and requires a reconciliation of the numerator
and denominator of the basic EPS computation to the numerator and denominator of
the diluted EPS computation. Basic EPS calculations are based on the weighted-
average number of common shares outstanding during the period, while diluted EPS
calculations are calculated using on the weighted-average number of common
shares and dilutive common share equivalents outstanding during each period. At
March 31, 2000, 2,074,000, which were all of our common stock options were
excluded from the dilutive EPS calculation as their effect was antidilutive.

The following data show the amounts used in computing earnings (loss) per
share and the effect on the weighted-average number of shares of dilutive common
stock for the three months ended March 31, 1999 and 2000. The amounts are
rounded to the nearest thousands except for per share amounts.

1999 2000
-------------------------------------- ------------------------------------------
Income Shares Per Share Income (loss) Shares Per Share
(Numerator) (Denominator) Amount (Numerator) (Denominator) Amount
----------- ------------- ------ ----------- ------------- ------

Basic EPS:
Net income (loss) available to
to common shareholders $ 2,902 23,114 $0.13 $(503) 24,871 ($0.02)

Effect of dilutive securities:
Stock options -- 1,366 -- --
------- ------ ----- ------

Diluted EPS:
Net income (loss)available to
common shareholders plus
assumed conversions $ 2,902 24,480 $0.12 $(503) 24,871 ($0.02)
======= ====== ===== ======

NOTE 2 INVENTORIES

At December 31, 1999 and March 31, 2000 inventory, rounded to the nearest
thousands, consist of the following:

1999 2000
------- -------

Raw materials.......................................... $ 5,788 $ 6,073
Finished goods......................................... 7,530 8,210
------- -------
$13,318 $14,283
======= =======

Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations

The following discussion is intended to assist in the understanding of
Mannatech's financial position and results of operations for the three months
ended March 31, 2000 compared to the same period in 1999. The Consolidated
Financial Statements and related Notes should be referred to in conjunction with
this discussion. Unless we state otherwise, all financial information presented
below, throughout this report and in the Consolidated Financial Statements and
related Notes includes Mannatech and all of its subsidiaries on a consolidated
basis.

Overview and Outlook

We develop and sell proprietary nutritional supplements and topical
products through a network marketing system. We currently sell our products in
the United States, Canada, Australia and the United Kingdom, through a network
of approximately 268,000 active associates as of April 28, 2000, compared to
approximately 244,000 active associates as of April 30, 1999. For the three
months ended March 31, 2000 international net sales were 23.1% of consolidated
net sales.

In the future, as we expand into additional international markets, we
expect international operations may account for an increasing percentage of our
consolidated net sales. We believe that once we open our Japanese operations, it
will increase our consolidated sales. Our Japanese operation is scheduled to
open in June or July of 2000. Our international growth would be attributable to
(A) our introduction of new products; (B) growth in the number of associates;
and (C) expansion into new international markets. In the first quarter of 2000,
the growth rate of Australian net sales increased and in November 1999, we
opened our United Kingdom operation. However, in 1999, which marked the
beginning of our expansion internationally, our growth rate in net sales
generated in the United States and Canada began to shrink as compared to prior
periods. In addition, in the first quarter of 2000, United States and Canadian
net sales actually decreased in both volume and in total dollars sold as
compared to the same period in 1999. We believe this decrease is primarily due
to our associates in the United States and Canada concentrating their efforts on
the development of their presence in the United Kingdom and Japan as opposed to
concentrating their efforts on domestic sales. We believe the decline in our
United States and Canada net sales may continue in 2000, as we incur additional
startup costs in our efforts of opening our Japan operations.

Our basic earnings (loss) per share was ($0.02) for the three-months ended
March 31, 2000 compared to $0.13 per share for the three-months ended March 31,
1999. This was primarily due to a decrease in sales of $2.3 million and $2.1
million in start up expenses relating to our continued international expansion
into Japan, some additional expenses incurred with the opening of the United
Kingdom in November 1999 and significant operating costs for the opening of our
website subsidiary, Internet Health Group, Inc., which sells nutritional
supplements over the Internet. We expect the net loss in the second quarter of
2000 as we continue to incur significant start up costs associated with
launching our Japanese operations; however, we have begun measures to reduce
unnecessary selling, administration and operating costs.

Our revenues are primarily from sales of our products and our associate
starter and renewal packs, which include some combination of our products and
promotional materials. The purchase of a starter or renewal pack allows the
associate to purchase products at wholesale prices. If the associate purchases a
pack with a wholesale price of $300 or higher, the associate also receives a $50
credit toward admission to one of our corporate events. We offer a comparable
associate starter pack in each country in which we do business; however, each
country has different regulatory guidelines that must be followed and therefore
not all types of packs are offered in all countries.

We generally recognize revenues upon shipment of products or promotional
materials. Our revenues are based primarily on the wholesale prices of the
products sold. On average, the wholesale value of the nutritional and topical
products contained in each of our packs are between 60% and 70% of the total
wholesale value of the packs. On average, the promotional materials value
contained in each of the packs are between 30% and 40% of the total wholesale
value of the packs. Revenues from promotional packs are allocated between
products and events admission based on the proportionate fair value of these
items. We defer revenue received from the sale of promotional packs to the
extent that it is greater than the wholesale value of the individual items
included in such packs. Allocated event revenues are also deferred. All deferred
revenue is amortized over a 12-month period. Total deferred revenue was
approximately $800,000, $700,000 and $900,000 at December 31, 1999, March 31,
1999 and 2000, respectively.

Associates are compensated by commissions, which are our most significant
expense. Commissions are paid to associates based on the following:

. their placement and position within our compensation plan;

. volume of direct commissionable sales; and

. number of new enrolled associates.

In October 1998, we revised portions of our compensation plan to perfect
our global seamless downline compensation concept and ensure compliance with
common international standards for paying commissions. The commission pool, as a
whole, remains unchanged and we do not intend for commissions, under our revised
compensation plan, to materially exceed 42% of commissionable net sales.

Our United States federal statutory tax rate is 35%. We pay taxes in
Australia at a statutory tax rate of 36% and in the United Kingdom at 31%. We
expect to pay taxes in Japan at a statutory tax rate of 54%. We also pay taxes
in various state jurisdictions at an approximate average statutory tax rate of
3%. As our international expansion continues, a portion of our income will be
subject to taxation in the countries in which we operate. We may receive foreign
tax credits that would reduce the amount of United States taxes we owe, based
upon the amount of foreign taxes paid. We may not be able to use all of our
foreign tax credits in the United States. The use of the foreign tax credits is
based upon the proportionate amount of net sales in each country. Because many
of the countries that we may expand into during 2000 and beyond have maximum
statutory tax rates higher than the United States tax rate, we could pay a
higher overall effective tax rate on our consolidated operations.

Results of Operations

The following table summarizes Mannatech's operating results as a
percentage of net sales for each of the periods indicated.

Three Months Ended
March 31,
---------------------------
1999 2000
------ ------

Net sales................................................. 100.0% 100.0%
Cost of sales............................................. 16.2 17.4
Commissions............................................... 40.6 41.6
------ ------
Gross profit............................................ 43.2 41.0
Operating expenses:
Selling and administrative expenses..................... 19.8 24.7
Other operating costs................................... 12.6 18.5
------ ------

Income (loss) from operations............................. 10.8 (2.2)

Interest income........................................... 0.2 0.6
Interest expense.......................................... (0.1) 0.0
Other expense, net........................................ (0.1) (0.3)
------ ------
Income (loss) before income taxes......................... 10.8 (1.9)

Income tax (expense) benefit.............................. (4.0) 0.7
------ ------
Net income (loss)......................................... 6.8% (1.2)%
====== ======

Number of starter packs sold.............................. 32,530 32,438
Number of renewal packs sold.............................. 14,604 18,337
------ ------
Total number of packs sold................................ 47,134 50,775
====== ======
Total associates canceling associate status............... 1,448 2,496
====== ======

Three months ended March 31, 2000 compared with the three months ended March 31,
1999.

Net Sales. Net sales decreased (5.4%) to $40.3 million for the three
months ended March 31, 2000 from $42.6 million for the comparable period in
1999. Net sales for United States and Canada decreased $3.0 million as compared
to the same period in 1999. We believe this decrease was primarily the result of
associates concentrating their efforts on developing a presence in Japan and the
United Kingdom rather than growing their business domestically. The overall
decrease, in net sales, was primarily composed of the following:

. A $4.1 million increase from the sale of several new products
introduced during the first three months of 2000 and the last nine
months of 1999.

. A ($6.4) million decrease in existing product sales resulting from a
decrease of approximately 30% of the volume of products sold in the
United States and Canada offset by the increase in Australian and the
United Kingdom existing product sales of approximately $680,000.

. Associate pack sales remained the same for the three months ended
March 31, 2000 compared to the same period in 1999. The number of new
associates purchasing packs remained the same; however, the dollar
sales of the new associate packs sold decreased by approximately
($100,000). This decrease was the result of the mix of associate packs
sold as the average price per pack decreased to $124 for the three
months ended March 31, 2000 from $128 for the comparable period in
1999. The number of associates renewing their associate status by
purchasing a renewal pack increased by 25.5% which was primarily the
result of hiring a marketing firm to increase annual renewals by
associates; however, the dollar sales of associate renewal packs sold
only increased by approximately $100,000. The slight increase was the
result of the mix of associate renewal packs sold as the average price
per pack decreased to $159 for the three months ended March 31, 2000
from $194 for the comparable period in 1999.

Cost of Sales. Cost of sales increased 1.4% to $7.0 million for the
three months ended March 31, 2000 from $6.9 million for the comparable period in
1999. As a percentage of net sales, cost of sales increased to 17.4% for the
three months ended March 31, 2000 from 16.2% for the comparable period in 1999.
The increase in cost of sales as a percentage of net sales was primarily due to
$200,000 of write-offs relating to the discontinuance of various promotional
materials sold and $208,000 of finished goods used in our quality control
sampling and given away as samples and charitable contributions. The dollar
increase in cost of sales was primarily the result of the decrease in volume of
finished goods which was offset by the $200,000 of write-offs of finished goods
and $208,000 finished goods used in our quality control sampling.

Commissions. Commissions consist of payments to associates for sales
activity and downline growth. Commissions decreased (3.5%) to $16.7 million for
the three months ended March 31, 2000 from $17.3 million for the comparable
period in 1999. As a percentage of net sales, commissions increased to 41.6% for
the three months ended March 31, 2000 from 40.6% for the comparable period in
1999. The percentage increase was the direct result of the following:

. an increase in the number of associate packs sold;

. the introduction of new incentive programs for associates, including
the fast start program in the fourth quarter of 1999; and

. the start up of operations in the United Kingdom in November 1999.

Gross Profit. Gross profit decreased (10.3%) to $16.5 million for the
three months ended March 31, 2000 from $18.4 million for the comparable period
in 1999. As a percentage of net sales, gross profit decreased to 41.0% for the
three months ended March 31, 2000 from 43.2% for the comparable period in 1999.
These changes were primarily attributable to the factors described above.

Selling and Administrative Expenses. Selling and administrative
expenses consist of human resource expenses, including wages, bonuses and
marketing expenses, including associate events and are a mixture of both fixed
and variable expenses. Selling and administrative expenses increased 16.5% to
$9.9 million for the three months ended March 31, 2000 from $8.5 million for the
comparable period in 1999. As a percentage of net sales, selling and
administrative expenses increased to 24.7% for the three months ended March 31,
2000 from 19.8% for the comparable period in 1999. The dollar amount of the
increase was due primarily to an increase of $1.1 million relating to
advertising for our Internet Health Group, Inc. subsidiary, hosting our
corporate events and a $350,000 increase in wages and benefits primarily due to
international expansion. The increase in corporate events was a result of
hosting events in Australia, United Kingdom and Japan and an increase in the
attendance of our annual national event.

Other Operating Costs. Other operating costs include utilities,
depreciation, travel, office supplies and printing expenses. Other operating
costs increased 37.0% to $7.4 million for the three months ended March 31, 2000
from $5.4 million for the comparable period in 1999. As a percentage of net
sales, other operating costs increased to 18.5% for the three months ended March
31, 2000 from 12.6% for the comparable period in 1999. The dollar amount
increase was primarily due to the following:

. an increase in our start up cost related to our international
expansion consisting of approximately $671,000 for consulting services
and $408,000 for various travel expenses.

. an increase of approximately $654,000 related to various operating
expenses for international expansion such as building rent for our
overseas offices, insurance, depreciation, postage and telephone; and

. approximately $300,000 increase in fees charged by a third party
processor for our Australia and United Kingdom operations.

Interest Income. Interest income increased 173.0% to $243,000 for the
three months ended March 31, 2000 from $89,000 for the comparable period in
1999. As a percentage of net sales, interest income increased 0.6% for the

9
v

three months ended March 31, 2000 from 0.2% for the comparable period in 1999.
The increase was primarily due to the receipt of the initial public offering net
proceeds, in February 1999, which we invested in interest bearing accounts and
certain investments.

Interest Expense. Interest expense decreased (52.0%) to $24,000 for the
three months ended March 31, 2000 from $50,000 for the comparable period in
1999. As a percentage of net sales, interest expense decreased to 0.0% for the
three months ending March 31, 2000 from 0.1% for the comparable period in 1999.
The decrease was due primarily to the reduction of the principal of our two
capital leases.

Other Expense, Net. Other expense consists of tax penalties,
miscellaneous income and nonoperating items. Other expense increased 558.8% to
$112,000 for the three months ended March 31, 2000 from $17,000 for the
comparable period in 1999. As a percentage of net sales, other expense increased
0.3% for the three months ended March 31, 2000 from 0.1% for the comparable
period in 1999. For the three months ended March 31, 2000, other expense
consisted of approximately $36,000 in certain tax penalties and approximately
$63,000 in currency exchange losses due to translation fluctuations. For the
three months ended March 31, 1999, other expense consisted primarily of
miscellaneous expense of $11,000 and $3,000 of currency exchange losses due to
translation fluctuations.

Income Tax (Expense) Benefit. Income tax (expense) benefit was $271,000
for the three months ended March 31, 2000 and ($1.7 million) for the comparable
period in 1999. The effective tax rate decreased to 35.0% for the three months
ended March 31, 2000 from 36.9% for the comparable period in 1999.

Net income (loss). For the three months ending March 31, 2000 we had a
net loss of ($503,000) compared to net income of $2.9 million for the comparable
period in 1999. As a percentage of net sales, (1.2%) for the three months ended
March 31, 2000 compared to 6.8% in 1999. The dollar amount of the decrease was
due to net sales decreasing by (5.4%), expenses incurred related to our
international expansion and corporate events.

Liquidity and Capital Resources

In February 1999, we received approximately $9.2 million in net proceeds
from the sale of our common stock in our initial public offering. In the initial
public offering, some of our existing shareholders sold 1,556,016 shares and we
sold 1,500,000 shares of our common stock, at $8.00 per share. We planned to use
approximately $6.3 million of our proceeds from the initial public offering for
international expansion, primarily for product registration, initial inventory
requirements and similar items and have used approximately $5.1 million on these
items as of March 31, 2000. The remaining $2.9 million was used to fund working
capital and for general corporate purposes. In February 1999, we also received
$641,271 from the exercise of 475,015 outstanding warrants at $1.35 per share.
In the first quarter of 2000, we received approximately $243,000 from the
exercise of 175,000 stock options at a price per share ranging from $1.35 to
$2.00 per share.

Our primary capital requirement is to fund working capital to support our
international growth. In the past, we financed our operations and capital
requirements through cash flows from operating activities. We had working
capital of $11.7 million as of December 31, 1999 compared to working capital of
$11.2 million at March 31, 2000. For the first three months of 1999, we invested
approximately $411,000 in property and equipment including the expansion into
Australia. During the first three months of 2000 we invested approximately $1.5
million in property and equipment including expansion into the United Kingdom
and Japan.

We paid approximately $1.3 million in dividends to our shareholders in the
first three months of 1999. Additionally, current liabilities are increasing due
to an increase in payables and inventory purchases relating to our expansion
into United Kingdom and Japan. We believe our existing facilities are sufficient
to support our near-term growth.

In March and August 1998, we entered into two capital leases with principal
amounts of $631,000 and $841,000, respectively. These capital leases bear
interest at 9.3%, are collateralized by the leased assets and are payable in
thirty-six monthly installments. In July 1998, we entered into a thirty-six
month, unsecured note payable with a finance company to finance our three-year
product liability insurance premium. The initial principal amount of this note
was $435,670, the interest rate is 8.0% and monthly installments are due through
December 2000.

Operating Activities. Net cash used in operating activities was ($3.3)
million for the three months ended March 31, 1999 compared to ($1.9) million for
the three months ended March 31, 2000. During 1999, an increase in net income
were partially offset by increases in inventory and other expenses related to
our international expansion and a decrease in income tax payable of
approximately $2.0 million from the tax benefit related to the exercise of
warrants. During the first three months ended March 31, 2000, we recorded a net
loss and an increase in inventory and payables related to our international
expansion. During the first three months of 2000, we have spent approximately
$700,000 and expect to spend up to an additional $3.0 million for start up
expenses and between $1.0 and $2.0 million for initial inventory for expansion
into Japan.

Investing Activities. Net cash provided by (used in) investing activities
was $462,000 for the three months ended March 31, 1999 compared to ($766,000)
for the three months ended March 31, 2000. In 1999, these activities consisted
primarily of purchases of computer hardware, internal development of computer
software and investing the net proceeds from the initial public offering into
investments offset by the repayment of the notes receivable due from certain
shareholders to us of approximately $974,000. We believe our facilities and
current software program should be sufficient for our current operations.
However, the remainder of 2000, we intend to spend up to an additional $3.8
million for translation of our software into other languages, additional
purchases of equipment and build-out of leased facilities for our planned
international expansion into Japan. In the first three months of 2000, these
activities consisted of purchases of computer hardware and software, build out
of our Japan facility, investments earnings and redemption of some investments.

Financing Activities. Net cash provided by financing activities totaled
$10.5 million and $64,000 for the three months ended March 31, 1999 and 2000,
respectively. We paid dividends on a monthly basis to our shareholders in the
amount of $0.02-$0.06 per share and paid dividends each month until the
completion of the initial public offering on February 12, 1999. Our board of
directors intends, from time-to-time, to reevaluate this policy after
considering relevant factors, including the level of our net income and
alternative uses of retained earnings. In February 1999, the gross initial
public offering proceeds of approximately $12.0 million were received. In the
first three months of 2000, we received approximately $243,000 related to the
exercise of 175,000 stock options at a price per share ranging from $1.35 to
$2.00.

Our existing capital resources, including working capital and bank
borrowings together with the proceeds from the initial public offering,
suspension of dividend payments to shareholders, and expected cash provided by
operating activities should be adequate to fund our operations for at least the
next 12 months. We have no present commitments or agreements with respect to any
acquisitions or purchases of manufacturing facilities or new technologies.
Changes could occur that would consume available capital resources faster than
anticipated. Our capital requirements depend on numerous factors, including:

. the timing and pace of our entry into international markets;

. growth in the number of associates; and

. our research and development efforts.

If our existing capital resources, together with the net proceeds of the
initial public offering, are insufficient to meet our capital requirements, we
will be required to raise additional funds. We cannot be sure that additional
funding, if necessary, will be available on favorable terms, if at all.

Year 2000

Prior to January 1, 2000, there was a great deal of concern regarding the
ability of computers to adequately distinguish 21st century dates from 20th
century dates due to the two-digit date fields used by many computer systems and
software programs. This inability to distinguish whether "00" means 1900 or 2000
may have resulted in failures or the creation of erroneous results. Most reports
to date indicate that computer systems are functioning normally and the
compliance and remediation work accomplished leading up to 2000 was effective
and prevented such problems.

We believe that our current versions of software products licensed from
third parties is Year 2000 compliant. However, some of our suppliers may be
running earlier versions of software products that may not be Year 2000
compliant. We have evaluated the Year 2000 readiness of our vendors and third
parties and found no system failures. Furthermore, we currently are unaware of
any material operational issues or costs associated with preparing and
maintaining our computer and technology systems for the Year 2000. However, we
still may experience material unanticipated problems and costs caused by
undetected errors or defects, which could seriously harm our business.

Our total cost associated with Year 2000 identification, remediation and
testing was approximately $100,000 and was funded through operating cash flows.
None of our applications failed to perform on January 1, 2000; however, computer
experts have warned that there may still be residual consequences of the change
in centuries. If we experience any application failures in 2000, it could result
in a decrease in sales of our products or an increase in the allocation of
resources to address the problem with the Year 2000. If this should occur, we
would have to resort to temporary manual processing, which is not expected to
have a material adverse impact on our short-term operations.

Recent Financial Accounting Standards Board Statements

In June 1998, the Financial Accounting Standards Board issued Financial
Accounting Standard No. 133, "Accounting for Derivative, Instruments and Hedging
Activities." This statement establishes accounting and reporting standards for
derivative financial instruments, including certain derivative financial
instruments imbedded in other contracts and for hedging activities. In June
1999, the Financial Accounting Standards Board issued Financial Accounting
Standard No. 137, which defers the effective date of Financial Accounting
Standard No. 133 to fiscal years beginning after June 15, 2000. As we do not
have any derivative financial instruments, this pronouncement is not expected to
impact us.

Forward-Looking Statements

Some of our statements under "Legal Proceedings," "Management's Discussion
and Analysis of Financial Condition and Results of Operations," "Quantitative
and Qualitative Disclosures about Market Risk," "Other Information" and the
Notes to Consolidated Financial Statements and elsewhere in this report
constitute "forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934
that are subject to certain events, risks and uncertainties that maybe outside
of our control. These forward-looking statements include statements of:

. management's plans and objectives for our future operations and economic
performance, international expansion;

. our capital budget and future capital requirements;

. meeting our future capital needs;

. the level of future expenditures;

. reduction of unneccessary selling, administrative and operating expenses;

. expected sales from our operations in Japan and the exposure to foreign
currency risks;

. expected future net losses;

. expected tax rates;

. use of proceeds;

. management's expectations; and

. the outcome of litigation matters, and the assumptions described
in this report underlying such forward-looking statements.

Actual results and developments could differ materially from those
expressed in or implied by such statements due to a number of factors,
including, without limitation:

. those described in the context of such forward-looking statements;

. future product development and manufacturing costs;

. timely development and acceptance of new products;

. the entrance into new countries and markets;

. the impact of competitive products and pricing;

. the political and economic climate in which we conduct operations; and

. the risk factors described from time to time in other documents and
reports filed with the Securities and Exchange Commission.

In some cases, forward-looking statements are identified by terminology
such as "may," "will," "should," "could," "expects," "plans," "intends,"
"anticipates," "believes," "estimates," "approximates," "predicts," "potential"
or "continue" or the negative of such terms and other comparable terminology.

Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance or achievements. Moreover, neither we nor anyone else
assumes responsibility for the accuracy and completeness of such statements. We
are under no duty to update any of the forward-looking statements after the date
of this report.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We do not engage in trading market risk sensitive instruments and do not
purchase as investments, as hedges, or for purposes "other than trading,"
instruments that are likely to expose us to certain types of market risk,
including interest rate, commodity price or equity price risk. We do have
investments but there has been no material change in our exposure to interest
rate risk on our investments. We have not issued any debt instruments, entered
into any forward or futures contracts, purchased any options or entered into any
swaps.

We also are exposed to certain other market risks, including changes in
currency exchange rates as measured against the United States dollar. The value
of the United States dollar affects our financial results. Changes in exchange
rates may positively or negatively affect our sales (as expressed in United
States dollars), gross margins, operating expenses and retained earnings. When
the United States dollar increases against currencies in which we sell products
or a weakening exchange rate against currencies in which we incur costs, our net
sales or costs may be adversely affected. We have established policies,
procedures, and internal processes governing the management of market risk and
the use of any financial instruments to manage our exposure to such risks. The
sensitivity of earnings and cash flows to variability in currency exchange rate
is assessed by applying an appropriate range of potential rate fluctuations to
our assets, obligations and projected transactions denominated in foreign
currency. Based upon our overall currency rate exposure at March 31, 2000, we do
not believe that our exposure to exchange rate fluctuations will have a material
impact on our consolidated financial position or consolidated results of
operations. However, as we expand into Japan, scheduled for the summer of 2000,
the Japanese Yen will become our primary currency for which we will have
exposure to foreign currency exchange rate risk. The Japan Yen fluctuated during
the first quarter of 2000 from 101.3 to 111.7 Japanese Yen to the United States
dollar. Given the uncertainty of the exchange rate fluctuation against the
United States dollar, we cannot determine the dollar effect, if any, of the
fluctuation on our future business, product pricing, results of operations or
financial condition. All statements other than historical information
incorporated in this Item 3 are forward-looking statements. The actual impact of
future market changes could differ materially due to, among other things,
factors discussed in this report.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

On February 24, 2000, Ms. Caroline Rivers filed a class action complaint in
District Court, County of Boulder, State of Colorado; naming Mannatech and three
other companies as co-defendants. The other defendants named in the complaint
were International Benefits Association, an unincorporated association, U.S.
Alliance, a Maryland corporation and Alliance Administrators, a Maryland
corporation. The other defendants were involved in certain health benefit
programs offered to Mannatech's associates. Ms. Rivers is alleging breach of
contract, negligence and that the defendants were marketing and selling illegal
health insurance policies and failed to pay benefits under such policies, which
caused economic loss to her and others. The complaint is in the beginning stages
and no class has been certified; however, Mannatech will file a response to the
complaint in May 2000 and seek to dismiss this matter as we believe we have
valid defenses and that the allegations are completely without merit.
Nevertheless, an adverse resolution to this matter could have a material adverse
effect on our business, results of operations, financial condition and
liquidity.

No other material changes in, or additions to, the legal proceedings
previously reported in Mannatech's Annual Report on Form 10-K for 1999 as filed
with the Commission on March 30, 2000.

Item 2. Changes in Securities and Use of Proceeds

(a) Not applicable.

(b) Not applicable.

(d) Uses of Proceeds from Registered Securities. On February 12, 1999,
we completed our initial public offering. In the initial public offering, we and
certain shareholders sold an aggregate of 3,056,016 shares of our common stock,
par value $0.0001 per share, at a price of $8.00 per share. None of such
payments were direct or indirect payments to directors, officers, affiliates or
10% beneficial owners of Mannatech. No underwriter was involved in the initial
public offering.

Of the total number of shares sold in the initial public offering,
1,556,016 shares of common stock were sold by certain shareholders of Mannatech
at a price of $8.00 per share, yielding gross proceeds, of $12,448,128. The net
proceeds to the selling shareholders were $11,950,203, after deducting the
placement agent's fee of approximately $497,925.

The remaining 1,500,000 shares sold in the initial public offering were
sold by Mannatech at a price of $8.00 per share, yielding gross proceeds to
Mannatech of $12 million. The net proceeds were $9,240,958, after deducting:

. deferred offering costs of approximately $1,963,431;

. legal, accounting, printing and other costs of approximately $406,385; and

. the placement agent's fee of $389,226, net of reimbursement of $90,774 in
expenses by the placement agent.

We intend to use our net proceeds of $9.2 million as follows:

. $6,265,858 of the net proceeds is intended to fund our international
expansion. As of March 31, 2000, we had used $5,136,390 of these proceeds
to pay for our expansion to Australia, the United Kingdom, and our
initiate expansion into Japan. We have $1,129,468 of the net proceeds
remaining for future international expansion.

. $2,975,100 of the net proceeds was used, as planned, to fund our current
working capital needs.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Submission of Matters to a Vote of Security Holders

None.

Item 5. Other Information

On April 1, 2000, Mr. Samuel L. Caster resigned as President and became
Co-Chairman of the Board. Mr. Terry L. Persinger was appointed by the Board to
replace Mr. Caster as President. On April 1, 2000, Mr. Charles E. Fiorett, also
resigned as Chief Executive Officer and Mr. Robert M. Henry was hired as our new
Chief Executive Officer. Mr. Henry, age 53, served as an Executive Partner for
Gryphon Investors, a private investor equity group from February 1999 to March
2000. From 1995 until August 1998, Mr. Henry served as Chief Operating officer
and Vice President of Operations and Systems for Hosiery Corp of America, who is
a manufacturer and distributor of pantyhose and other women's intimate apparel.
From 1990 to 1995, Mr. Henry served as Chief Operating Officer, Chief Financial
Officer and Vice Chairman for McCaffrey and McCall partners, which is a full
service advertising agency. Mr. Henry received a B.S. in Accounting from Hunter
College in New York, New York and a J.D. from Brooklyn Law School. Mr. Henry has
been a member of the New York State Bar since 1975. In addition, Mr. Henry is a
director of Purity Products, Inc.

On May 5, 2000, the written resignation of Mr. Samuel L. Caster was
accepted by our Board of Directors. Mr. Caster resignation stated he would
resign due to the recent decisions to remove him as President and subsequent
refusal to name him as the sole Chairman of the Board. Mr. Caster stated for
these reasons, he felt he was no longer empowered to make a significant
contribution to Mannatech. Mr. Robert M. Henry was appointed to replace Mr.
Samuel L. Caster as a Class I director. Mannatech filed a Form 8-K, on May 12,
2000 disclosing the reasons for Mr. Caster's resignation and disagreements and
Mannatech's response.

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits required by Item 601 of Regulation S-K

3.1 Amended and Restated Articles of Incorporation of Mannatech,
dated October 25, 1995, incorporated herein by reference to
Exhibit 3.1 to Mannatech's Form S-1 (File No. 333-63133) filed
with the Commission on September 10, 1998.

3.2 Second Amended and Restated Bylaws of Mannatech, dated August
26, 1997, incorporated herein by reference to Exhibit 3.2 to
Mannatech's Form S-1 (File No. 333-63133) filed with the
Commission on September 10, 1998.

3.3 Amendment to the Bylaws of Mannatech dated May 19, 1998,
incorporated herein by reference to Exhibit 3.3 to Mannatech's
Form S-1 (File No. 333-63133) filed with the Commission on
September 10, 1998.

3.4 Amendment to the Bylaws of Mannatech dated October 20, 1999,
incorporated herein by reference to Exhibit 99 to Mannatech's
Form 8-K (File No. 000-24657) filed with the Commission on
November 3, 1999.

4 Specimen Certificate representing the common stock, par value
$0.0001 per share, of Mannatech, incorporated herein by
reference to Exhibit 4.1 to Mannatech's Amendment No. 1 to Form
S-1 (File No. 333-63133) filed with the Commission on October
28, 1998.

10.1 1997 Stock Option Plan dated May 20, 1997, incorporated herein
by reference to Exhibit 10.1 to Mannatech's Form S-1 (File No.
333-63133) filed with the Commission on September 10, 1998.

10.2 1998 Incentive Stock Option Plan dated April 8, 1998,
incorporated herein by reference to Exhibit 10.2 to Mannatech's
Form S-1 (File No. 333-63133) filed with the Commission on
September 10, 1998.

10.3 Option Agreement dated July 1, 1997 with Multi-Venture
Partners, Ltd., incorporated herein by reference to Exhibit
10.7 to Mannatech's Form S-1 (File No. 333-63133) filed with
the Commission on September 10, 1998.

10.4 Option Agreement dated October 19, 1999 with Steven A. Barker
Ph.D., incorporated by reference to Exhibit 10.8 to Mannatech's
1999 Form 10-K (File No. 000-24657) filed with the Commission
on March 30, 2000.

10.5 Form of Indemnification Agreement with a schedule of director
signatures, incorporated herein by reference to Exhibit 10.8 to
Mannatech's Form S-1 (File No. 333-63133) filed with the
Commission on September 10, 1998.

10.6 Schedule of additional directors signatories relating to the
Form of Indemnification Agreements in Exhibit 10.5 above,
incorporated by reference to Exhibit 10.10 to Mannatech's 1999
Form 10-K (File No. 000-24657) filed with the Commission on
March 30, 2000.

10.7 Letter of Understanding Regarding Development of Proprietary
Information for Mannatech effective as of August 1, 1997, as
amended, by and between Bill H. McAnalley, Ph.D. and Mannatech,
incorporated herein by reference to Exhibit 10.12 to
Mannatech's Form S-1 (File No. 333-63133) filed with the
Commission on September 10, 1998.

10.8 Commercial Lease Agreement dated November 7, 1996 between MEPC
Quorum Properties II Inc. and Mannatech, as amended by the
First Amendment thereto dated May 29, 1997 and the Second
Amendment thereto dated November 13, 1997, incorporated herein
by reference to Exhibit 10.13 to Mannatech's Form S-1 (File No.
333-63133) filed with the Commission on September 10, 1998.

10.9 Commercial Lease Agreement dated May 29, 1997 between MEPC
Quorum Properties II Inc. and Mannatech, as amended by the
First Amendment thereto dated November 6, 1997, incorporated
herein by reference to Exhibit 10.14 to Mannatech's Form S-1
(File No. 333-63133) filed with the Commission on September 10,
1998.

10.10 Assignment of Patent Rights dated October 30, 1997 by and among
Bill H. McAnalley, Ph.D., H. Reginald McDaniel, D. Eric Moore,
Eileen P. Vennum and William C. Fioretti and Mannatech,
incorporated herein by reference to Exhibit 10.15 to
Mannatech's Form S-1 (File No. 333-63133) filed with the
Commission on September 10, 1998.

10.11 Supply Agreement effective as of August 14, 1997 by and between
Mannatech and Caraloe, Inc., incorporated herein by reference
to Exhibit 10.17 to Mannatech's Form S-1 (File No. 333-63133)
filed with the Commission on September 10, 1998.

10.12 Trademark License Agreement effective as of August 14, 1997 by
and between Mannatech and Caraloe, Inc., incorporated herein by
reference to Exhibit 10.19 to Mannatech's Form S-1 (File
No. 333-63133) filed with the Commission on September 10, 1998.

10.13 Supply Agreement effective January 12, 2000 by and between
Mannatech and Caraloe, Inc, incorporated herein by reference to
Exhibit 10.17 to Mannatech's 1999 Form 10-K (File No. 000-
24657) filed with the Commission on March 30, 2000.

10.14 Letter of Agreement from Mannatech to Michael L. Finney of
LAREX, Incorporated dated December 23, 1997, incorporated
herein by reference to Exhibit 10.20 to Mannatech's Form S-1
(File No. 333-63133) filed with the Commission on September 10,
1998.

10.15 Product Development and Distribution Agreement effective as of
September 15, 1997 between New Era Nutrition Inc. and
Mannatech, incorporated herein by reference to Exhibit 10.21 to
Mannatech's Form S-1 (File No. 333-63133) filed with the
Commission on September 10, 1998.

10.16 Summary of Management Bonus Plan, incorporated herein by
reference to Exhibit 10.23 to Mannatech's Form S-1 (File No.
333-63133) filed with the Commission on September 10, 1998.

10.17 Individual Guaranty of Samuel L. Caster dated January 5, 1998,
incorporated herein by reference to Exhibit 10.27 to
Mannatech's Form S-1 (File No. 333-63133) filed with the
Commission on September 10, 1998.

10.18 Individual Guaranty of Charles E. Fioretti dated January 5,
1998, incorporated herein by reference to Exhibit 10.28 to
Mannatech's Form S-1 (File No. 333-63133) filed with the
Commission on September 10, 1998.

10.19 Form of Employment Agreement entered into between Mannatech and
each of Charles E. Fioretti, Patrick D. Cobb, Anthony E.
Canale, Bill H. McAnalley and Deanne Varner, incorporated
herein by reference to Exhibit 10.30 to Mannatech's Amendment
No. 1 to Form S-1 (File No. 333-63133) filed with the
Commission on October 28, 1998.

10.20 Employment Agreement dated November 1, 1999, entered into
between Mannatech and Terry L. Persinger, incorporated herein
by reference to Exhibit 10.25 to Mannatech's 1999 Form 10-K
(File No. 000-24657) filed with the Commission on March 30,
2000.

10.21 Renewal and Extension Promissory Note dated February 17, 1999
in the amount of $33,316.02 made by Patrick D. Cobb,
incorporated herein by reference to Exhibit 10.25 to
Mannatech's 1998 Form 10-K (File No. 000-24657) filed with the
Commission on March 31, 1999.

10.22 Renewal and Extension Promissory Note dated February 17, 1999
in the amount of $199,896.10 made by Samuel L. Caster,
incorporated herein by reference to Exhibit 10.26 to
Mannatech's 1998 Form 10-K (File No. 000-24657) filed with the
Commission on March 31, 1999.

10.23 Renewal and Extension Promissory Note dated February 17, 1999
in the amount of $199,896.09 made by Charles E. Fioretti,
incorporated herein by reference to Exhibit 10.27 to
Mannatech's 1998 Form 10-K (File No. 000-24657) filed with the
Commission on March 31, 1999.

10.24* Form of Employment Agreement entered into between Mannatech
and Robert M. Henry.

27* Financial Data Schedule.
_____________
* Filed herewith.

(b) Reports on Form 8-K.

On May 12, 2000, Mannatech filed a Form 8-K (File No. 000-24657) with
the Securities and Exchange Commission in connection with the written
resignation of Mr. Samuel L. Caster which was accepted by our Board of
Directors on May 5, 2000. Mr. Caster outlined his resignation and
disagreements in a letter dated May 3, 2000.

Mannatech believes Mr. Caster's reasons for resigning were ultimately
personal; however, strongly disagrees with Mr. Caster's allegations.
In addition, Mannatech also rejected his proposal letter, dated May 3,
2000.

SIGNATURES

Pursuant to the requirements of Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

MANNATECH, INCORPORATED

May 15, 2000 /s/ ROBERT M. HENRY
-----------------------------------------
Robert M. Henry
Chief Executive Officer and Director

May 15, 2000 /s/ STEPHEN D. FENSTERMACHER
-----------------------------------------
Stephen D. Fenstermacher
Senior Vice President and Chief Financial
Officer and principal financial officer

INDEX TO EXHIBITS

3.4 Amendment to the Bylaws of Mannatech dated October 20, 1999,
incorporated herein by reference to Exhibit 99 to Mannatech's
Form 8-K 9File No. 000-24657) filed with the Commission on
November 3, 1999.

10.1 1997 Stock Option Plan dated May 20, 1997, incorporated herein
by reference to Exhibit 10.1 to Mannatech's Form S-1 (File No.
333-63133) filed with the Commission on September 10, 1998.

to Exhibit 10.13 to Mannatech's Form S-1 (File No. 333-63133)
filed with the Commission on September 10, 1998.

10.12 Trademark License Agreement effective as of August 14, 1997 by
and between Mannatech and Caraloe, Inc., incorporated herein by
reference to Exhibit 10.19 to Mannatech's Form S-1 (File No.
333-63133) filed with the Commission on September 10, 1998.

10.16 Summary of Management Bonus Plan, incorporated herein by
reference to Exhibit 10.23 to Mannatech's Form S-1 (File No.
333-63133) filed with the Commission on September 10, 1998.

10.24* Form of Employment Agreement entered into between Mannatech and
Robert M. Henry.

27* Financial Data Schedule.
_____________
* Filed herewith.