The Company currently utilizes a contract manufacturer for production and packaging of its products, and

management has indicated that this manufacturer has virtually unlimited capacity. As many companies of its size,

Anthus Life is moving toward the addition of distribution partners. As the volume increases, direct ship to

retailers can be costly and inefficient use of capital for a company of this size and stage of development. We view

the Company's decision to outsource these functions the only rational decision at this point.