What changed in this filing

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Item 1. Business

2023-03-17 compared with 2022-03-15 · 43 added, 41 removed, 606 unchanged (12% of the section changed)

Mannatech is a global wellness solution provider, which was incorporated and began operations in November 1993.

Mannatech, Incorporated ("Mannatech" or the "Company") is a global wellness solution provider, which was incorporated and began operations in November 1993.

We develop and sell innovative, high quality, proprietary nutritional supplements, topical and skin care and anti-aging products, and weight-management products that target optimal health and wellness.

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and (iii) Asia/Pacific (Australia, Japan, New Zealand, the Republic of Korea, Singapore, Taiwan, Hong Kong, and China).

We sell our products through network marketing distribution channels via our active associates ( "independent associate" or "associates" or "distributors") and to our "preferred customers," which we believe is the most cost-effective way to quickly and effectively introduce our products and communicate information about our business to the global marketplace.

We also ship our products to customers in the following countries:

Belgium, France, Greece, Italy, Luxembourg, and Poland.

We sell our products through network marketing distribution channels via our active associates (“independent associate” or “associates” or “distributors”) and to our “preferred customers,” which we believe is the most cost-effective way to introduce our products and communicate information about our business to the global marketplace quickly and effectively.

Network marketing minimizes upfront costs, as compared to conventional marketing methods, and allows us to be more responsive to the ever-changing overall market conditions, as well as continue to research and develop high quality products and focus on controlled successful international expansion.

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This compound allows a more potent concentration of the full range of mannose-containing polysaccharides occurring naturally in aloe to be produced in a stable powdered form.

• In 2007, we introduced into the United States market our skin care and anti-aging line of products designed to support skin’s natural texture, beauty, and elasticity.

We also launched our PhytoMatrix ® caplets, Advanced Ambrotose ® capsules and Manna•Bears ™ supplement into international markets.

• In 2008, we introduced a proprietary proteolytic enzyme and phytosterol dietary supplement designed to support the body’s natural recovery processes associated with physical activity in our BounceBack ® capsules.

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In addition, we improved our Ambrotose ® products to include beta-Carotene.

• In 2010, we launched our Mannatech LIFT ™ Skin Care System, which is paraben-free and formulated to give skin a more natural youthful appearance.

• In 2011, we introduced our reformulated version of our Omega-3 supplement, which now includes Vitamin D 3 and features EPA/DHA essential acids.

We expanded several previously launched products from our domestic line to our international markets.

• In 2012, we launched our NutriVerus ™ powder, a single product that features all of our core scientific technologies at an affordable price.

This unique, ground-breaking product combines our core glyconutrient technologies with vitamins, minerals, antioxidants and stabilized rice bran, all based on Real Food Technology solutions.

• In 2013, we launched Uth ® skin cream, a breakthrough in anti-aging that incorporates Mannatech’s glyconutrient technology along with a microsphere delivery system that supports more thorough delivery of the active ingredients to all levels of the skin.

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• In 2015, Mannatech introduced a new brain supplement, Cognitate ™ , featuring a proprietary blend of natural ingredients designed to aid memory, recall and cognition.

• In 2016, Mannatech rebranded the Company, including all new packaging and labels, introduced a line of Essential Oils, along with an innovative, natural fat-loss system, TruHealth TM .

• In 2016, Mannatech rebranded the Company, including all new packaging and labels, and introduced an innovative, natural fat-loss system, TruHealth TM .

Included in the system is the TruPLENISH TM Nutritional Shake, TruPURE ® Cleanse Slimsticks and TruSHAPE TM Fat-Loss Capsules.

• In 2017, Mannatech launched several new products, including:

GinMAX ® , a fast-acting, long-lasting ginseng supplement that utilizes both fermented red and fermented white ginseng, fortified with glyconutrients;

GlycoCafé ® , a glyconutritional coffee made with the whole coffee fruit;

and Luminovation, a line of mass-market and premium Korean beauty products.

• In 2017, Mannatech launched several new products, including GlycoCafé ® , a glyconutritional coffee made with the whole coffee fruit, and Luminovation, a line of mass-market and premium Korean beauty products.

• In 2018, Mannatech launched a unique fitness drink, EMPACT+ ® , combining fueling, hydration and recovery in one product.

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• In 2019, Mannatech’s key product launches were:

Eye Health, TruPlenish Chocolate and Vanilla sachets, New Catalyst, Women’s Health, reformulated TruShape, Liver Support, Hangover Support and Sleep Support products into various markets.

Eye Health, TruPlenish Chocolate and Vanilla sachets, New Catalyst, Liver Support, and Sleep Support products in various markets.

• In 2020, Mannatech’s key product launches included a product suite to address microbiome health:

new GI-Defense ™ intestinal support product, improved GI-ProBalance pre/pro-biotic product and improved GI-Zyme digestive enzyme product, reformulated ImmunoStart and MannaBOOM products, an innovative new Joint Support product in Japan, an innovative new immune support product named MannaGel in Hong Kong and a re-launch of its MannaBears gummies.

• In 2021, Mannatech introduced a new ginger hibiscus flavor to the existing Ambrotose Life ® product offering, Liver Support, providing detox support for healthy liver function.

In addition, Mannatech introduced Sugar Balance, Inner Beauty (a collagen product), Luminovation Renewal, Joint Support and MannaZen con Aloe Prime in Mexico.

• In 2021, Mannatech introduced Liver Support to the North American market, providing detox support for healthy liver function.

In addition, Mannatech introduced Sugar Balance, Inner Beauty Collagen, and Luminovation to Korea, and, in Mexico, Mannatech introduced a drink mix, MannaZen con Aloe Prime.

• In 2022, Mannatech introduced existing products into new markets.

Mannatech added the South African and Australian product Superfood Greens and Reds in the United States, launched Korean Luminovation skincare line in Hong Kong and Japan, and brought Manapol ® and Ambrotose Life ® to Canada.

There were also reformulations for the purpose of enhancing existing products, such as the relaunch of EMPACT+ and Enzyme ProBalance.

Mannatech introduced two unique drink mixes in Mexico, MannaForce+ and M Gold+.

Mannatech offers products that include glyconutrients, a unique category of nutrients sourced from plants and designed to provide a variety of health benefits.

We focus on producing products that are from natural sources, as well as other scientifically based efficacious sources.

Integrative Health , which offers a variety of nutritional supplements that aid in optimizing overall health and wellness.

Integrative Health , which offers a variety of nutritional supplements that are designed to aid in optimizing overall health and wellness.

This category includes a variety of daily nutritional supplements, health solutions for children, and additional nutrients designed to help keep specific body systems at optimal levels.

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Integrative Health Ambrotose ® Complex, Ambrotose AO ® , Advanced Ambrotose ® , Ambrotose Life ®

Catalyst™, Cognitate ® , Manapol ® Powder, MannaBears™, MultiKids, Nutriverus™, Optimal Support Packets, PhytoMatrix ® , PLUS™, Chaga Cafe, Glycentials™, MannaTea™, PhytoCleanse, and TruCoffee ®

Targeted Health BounceBack ® , CardioBALANCE ® , GI-ProBalance ® Slimstick, GI-Zyme ® , GI-Defense™, Blood Sugar ProBalance, ImmunoSTART ® , Manna-C ™, MannaBOOM ® Slimsticks, MannaCLEANSE™, Omega-3 with Vitamin D3, PhytAloe ® , I-Start, MannaAloe ® with AloePrime ® , Chlorophyll, MANNAGEL™, MegaKids, and Jumping Hi Kids.

Targeted Health BounceBack ® , CardioBALANCE ® , GI-ProBalance ® Slimstick, GI-Zyme ® , GI-Defense®, Blood Sugar ProBalance, ImmunoSTART ® , Manna-C ™, MannaBOOM ® Slimsticks, MannaCLEANSE™, Omega-3 with Vitamin D3, PhytAloe ® , I-Start, MannaAloe ® with AloePrime ® , Chlorophyll, MANNAGEL™, MegaKids, GlyCollagen con Aloe Prime, M Gold+ con aloe Prime™ and GlycoForce + con aloePrime™

Weight and Fitness OsoLean ® , SPORT™, TruHealth Fat Loss System, including:

TruPLENISH™, TruPURE ® , TruSHAPE™, Tru-C™, EMPACT+ ® , EM∙PACT ® , Mannashake, and TruCoffee™

Skin Care Emprizone ® , FIRM with Ambrotose ® , Uth ® Facial Cleanser, Uth ® Skin Rejuvenation Crème, Uth ® Moisturizer, FreshDen ® , Organt ® , Luminovation™, and MannaDent

Essentials Catalyst™ Multivitamin, Eye Support, Sleep Support, Liver Support, Joint Support, and SUPERFOOD

Home Living SERENITY Oils and Blends and PURO

A significant portion of our revenue is derived from our Ambrotose Life ® , TruHealth ™ , Advanced Ambrotose ® , Optimal Support Packets, and GI-Pro products.

TruPLENISH™, TruPURE ® , TruSHAPE™, EMPACT+ ® , EM∙PACT ® and Mannashake

Skin Care Emprizone ® , FIRM with Ambrotose ® , Uth ® Facial Cleanser, Uth ® Skin Rejuvenation Crème, Uth ® Moisturizer, FreshDen ® , Luminovation™ and MannaDent

Essentials Catalyst™ Multivitamin, Eye Support, Liver Support, Joint Support and SUPERFOOD

Home Living SERENITY Oils and Blends, Organt® and PURO

A significant portion of our revenue is derived from our Ambrotose Life ® , TruHealth ™ , Advanced Ambrotose ® , Manapol® Powder and Optimal Support Packets.

Revenue from these products were as follows for the years ended December 31, 2022 and 2021 (in thousands, except percentages) :

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15,730 11.5 % 18,010 11.3 %

Manapol ® Powder

13,141 8.2 % 7,187 4.7 %

Advanced Ambrotose ®

9,624 7.0 % 11,158 7.0 %

GI-Pro (MicroBiome) 8,478 5.3 % 7,513 5.0 %

Manapol ® Powder

7,909 5.8 % 13,141 8.2 %

Optimal Support Packets 6,916 5.0 % 7,593 4.7 %

Total $ 68,913 50.2 % $ 78,678 49.2 %

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Industry Overview

Nutrition Industry We operate in the nutritional supplement industry and distribute and sell our products through our own global network marketing channel.

Nutrition Industry.

We operate in the nutritional supplement industry and distribute and sell our products through our own global network marketing channel.

The nutritional supplement industry is fast-paced, highly fragmented, and intensely competitive.

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However, in 1994, the Dietary Supplement Health and Education Act of 1994 (“DSHEA”) was passed in the United States, drastically changing the dietary supplement marketplace.

The DSHEA was instrumental in expanding the category of dietary supplements to further include herbal and botanical supplements and ingredients such as ginseng, fish oils, enzymes, and various mixtures of these ingredients.

DSHEA was instrumental in expanding the category of dietary supplements to further include herbal and botanical supplements and ingredients such as ginseng, fish oils, enzymes, and various mixtures of these ingredients.

Under DSHEA, vendors of dietary supplements are now able to educate consumers regarding the effects of certain component ingredients.

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Direct selling, of which network marketing is a significant segment, has grown significantly and has been enhanced in the past decade as a distribution channel due to advancements in technology and communications resulting in improved product distribution and faster dissemination of information.

Direct Selling/Network Marketing Channel Since the 1990s, the direct selling and network marketing sales channel has grown in popularity and general acceptance, including acceptance by prominent investors and capital investment groups who have invested in direct selling companies.

Direct Selling/Network Marketing Channel.

Since the 1990s, the direct selling and network marketing sales channel has grown in popularity and general acceptance, including acceptance by prominent investors and capital investment groups who have invested in direct selling companies.

This has provided direct selling companies with additional recognition and credibility in the growing global marketplace.

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Several consumer-product companies have launched their own direct selling businesses with international operations often accounting for the majority of their revenues.

Consumers and investors are beginning to realize that direct selling provides unique opportunities and a competitive advantage in today’s markets.

Consumers and investors realize that direct selling provides unique opportunities and a competitive advantage in today’s markets.

Businesses are able to quickly communicate and develop strong relationships with their customers, bypass expensive ad campaigns, and introduce products and services that would otherwise be difficult to promote through traditional distribution channels such as retail stores.

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All of Mannatech's dietary supplements have been confirmed to be gluten-free.

G lobal Scientific Advisory Board .

A charter for an advisory board has been established and the board is filled by a combination of independent scientists and doctors from multiple disciplines, along with one member of Mannatech staff.

Certain member(s) of the Global Scientific Advisory Board (“GSAB”) review each new and reformulated product as needed to ensure ingredients and products are up to Mannatech’s high standards and are in line with the latest, viable research.

The GSAB may also make ingredient and product suggestions for new products.

High-Caliber, Industry-Leading Independent Associates .

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▪ offering a satisfaction guarantee product return policy;

▪ providing comprehensive corporate websites that provide instant access to Internet ordering, marketing, technical and educational information, and unique and innovative marketing tools (mannatech.com, allaboutmannatech.com, mannatechscience.org, library.mannatech.com, training.mannatech.com, library.mannatech.com, events.mannatech.com, and mannafest.com);

▪ providing comprehensive corporate websites that provide instant access to Internet ordering, marketing, technical and educational information, and unique and innovative marketing tools (including www.mannatech.com, www.allaboutmannatech.com, www.mannatechscience.org, library.mannatech.com, training.mannatech.com, events.mannatech.com, and www.mannafest.com);

▪ maintaining an extensive web-based downline management system called Success Tracker™ that provides access to web conferencing and downline organization reporting for our independent associates at minimal costs;

▪ providing Mannatech+, an app and web-based platform to provide personalized web pages, to share videos, digital flyers, and more;

▪ providing Mannatech+, an app and web-based platform that provides personalized web pages, to share videos, digital flyers, and more;

▪ providing Social Media Studio, an app that assists Associates in creating custom social media postings, while utilizing the latest methods to identify non-compliant posts and alert Associates to make alterations before posting;

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We pursue registrations for various trademarks associated with our key products and branding initiatives.

As of December 31, 2021, we had 38 registered trademarks in the United States and five trademark applications pending with the United States Patent and Trademark Office.

As of December 31, 2022, we had 41 registered trademarks in the United States and three trademark applications pending with the United States Patent and Trademark Office.

As of December 31, 2022, we had 592 registered trademarks in 40 countries and 16 trademark applications pending in 11 foreign jurisdictions.

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The Company applies for patent protection in various countries for the technology related to our product formulations.

As of December 31, 2021, we had 11 patents for technology related to our Ambrotose ® formulation, all of which are in 10 foreign jurisdictions.

As of December 31, 2022, we had 11 patents for technology related to our Ambrotose ® formulation, all of which are in 10 f oreign jurisdictions.

Overall, as of December 31, 2022, 94 patents have been assigned, issued, granted or validated to Mannatech in major global markets for the technology relating to our Ambrotose ® , Ambrotose AO ® , Ambrotose Life ® , GI‑ProBalance™, PhytoMatrix ® , and NutriVerus™ product formulations, as well as in the field of biomarker assays.

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Based upon our knowledge of industry-related network marketing compensation plans, we believe our global associate career and compensation plan remains strong in the industry.

Together, our commissions and incentives range approximately from 35% to 43% of our consolidated net sales.

Together, our commissions and incentives range from 35% to 43% of our consolidated net sales.

Our global associate career and compensation plan pays various types of commissions and incentives based upon a point system that calculates a percentage of the independent associate’s commissionable direct and indirect net product sales and the attainment of certain associate achievement levels.

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• various agencies of the states and localities in which our products are sold.

The FDA regulates the formulation, manufacturing, packaging, storage, labeling, promotion, distribution, and sale of foods, dietary supplements, over-the-counter drugs, medical devices, and pharmaceuticals.

In January 2000, the FDA issued a final rule called “Statements Made for Dietary Supplements Concerning the Effect of the Product on the Structure or Function of the Body”.

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• pre-market notification procedures for new dietary ingredients in nutritional supplements.

The Modernization of Cosmetics Regulation Act of 2022, ("MoCRA"), was signed into law in December 2022.

MoCRA expands the FDA’s oversight of the cosmetic industry.

Most requirements under MoCRA will be effective in December 2023.

Once fully implemented, MoCRA will require adverse event recordkeeping and reporting, manufacturer facility registration, product listing, records supporting safety substantiation, minor label modifications including contact information for adverse event reporting and labeling of fragrance allergens.

MoCRA also grants the FDA the authority to initiate mandatory product recalls as well as the authority to suspend facility registration when warranted.

Once the FDA issues the requisite rulemaking, cosmetic manufacturers will be required to comply with cosmetics-specific current Good Manufacturing Processes.

We develop and maintain product substantiation dossiers, which contain the scientific literature pertinent to each product and its ingredients.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business