MusclePharm CEO Issues Letter to Shareholders

MusclePharm CEO Issues Letter to Shareholders 
DENVER, CO -- (Marketwire) -- 02/15/13 --  MusclePharm Corporation
(OTCQB: MSLP), a nutritional supplement company focused on active
lifestyles, is pleased to announce that it has released a letter from
its CEO, Bradley J. Pyatt, to update shareholders on the current
status of the Company.  
Dear Valued MusclePharm Shareholder, 
I want to personally thank you for being a MusclePharm Corporation
shareholder. We are excited about the future of our Company and this
letter outlines our vision and plans for the future.  
Over the past three years we achieved exponential product sales
growth, growing from around $1.4 million in revenue for 2009, to
approximately $78 million in 2012. However, to finance that growth
from essentially a startup mode we had to utilize dilutive financing
instruments, which were very expensive and hurt our financial
performance, and as one would expect, our stock price suffered too.
All of us at MusclePharm believe that our market capitalization today
is not a valid reflection of our Company's current underlying
fundamentals. Below I address how we are proactively addressing our
future, which we believe should result in better financial results
and a higher stock price as we move forward. 
As you probably know, we recently completed a $12.0 million
registered direct offering of our Series D Convertible Preferred
Stock at $8.00 per share. Each preferred share is convertible into
two shares of our common stock. In 2012, we spent considerable time
cleaning up the Company's balance sheet and raising other capital to
support our growth. In late 2012, we issued 516,308 shares of our
common stock to several accredited investors pursuant to conversions
of warrants to purchase an aggregate of 728,648 shares of our common
stock. As a result of these warrant conversions and other
extinguishments of derivative liabilities, our stockholders' deficit
decreased from approximately $11.0 million at June 30, 2012 to
approximately $7.3 million at September 30, 2012 and our derivative
liabilities decreased from approximately $7.9 million at June 30,
2012 to approximately $25,000 at September 30, 2012. Now, in the
first quarter of 2013, after our registered direct offering, we
believe we have positioned the Company to contin
ue growing with the
proper type of capital structure that will allow us to focus on
With the proceeds from our recently completed offering we paid off
all our mezzanine and short-term debt. We are now debt free. We
expect to use the remaining proceeds from the offering to launch new
products, seek to expand internationally, and seek to increase our
U.S. sales force.  
As you also are probably aware, in late 2012 we completed an 850:1
reverse stock split. The reverse split was a necessary step for us to
seek a listing on a stock exchange. We expect we will have such a
listing this summer after we post our 2013 first quarter results.
There are several benefits to being listed on a stock exchange, but
the most important is the ability to seek institutional investment in
our shares. The institutions that were looking at investing in our
Company over the past few years declined for the most part, citing
our lack of a stock exchange listing. Going forward, these investors
will have the ability to participate in our Company once we are
listed on an exchange. 
Our Growth Story 
In September of 2008, we started MusclePharm out of my garage in
Denver, Colorado. Fast-forward to today and we are recognized as a
global leader in a multi-billion dollar industry. Our gross revenue
increased exponentially as follows*: 
$s in millions
 2009: $0 - $1
 2010: $1 - 4 (300% gain YOY)
 2011: $4
- 17 (325% gain YOY)
 2012: $17 - 78 (370% gain YOY) 
* These numbers have been rounded for ease of reading, and 2012 is
In a time when our economy has struggled, we achieved revenue growth
of approximately 300%+ year over year. We project we will increase
our gross revenues in 2013 to over $100 million.  
At the 2012 Supplement Awards, we received three
Awards of Excellence; we received (i) the "Brand of the Year" award,
(ii) the "Packaging of the Year" award, and (iii) the "Pre-Workout
Supplement of the Year" award for Assault(TM). On top of that, we've
won over 15 other industry awards since our inception.  
Our headquarters in Denver, Colorado has a state-of-the-art over
30,300 square feet athletic facility with a medical and clinical
testing department, complete with equipment for measuring and
conducting athletic clinical studies and supporting athletes. Our
medical and clinical professionals consist of several nationally
recognized medical doctors and nutritional experts who oversee our
product research, formulation, efficacy analysis and testing. It also
serves as a place for some of the world's top athletes to come and
train and be educated on the latest nutritional advancements that we
have under development.  
Our primary growth strategy is to: 

--  Increase our product distribution and sales through increased market
    penetrations both domestically 
and internationally;
--  Increase our margins by focusing on streamlining our operations and
    seeking operating efficiencies in all areas of our operations;
--  Continue to conduct additional testing of the safety and efficacy of
    our products and formulate new products; and
--  Increase awareness of our products by increasing our marketing and
    branding opportunities through endorsements, sponsorships and brand

Our core marketing strategy is to brand MusclePharm as the "must have"
fitness brand for workout enthusiasts and elite athletes. We seek to
be known as the "athlete's company," run by athletes who create their
products for other athletes, both professional and otherwise. We
believe that our marketing mix of endorsers, sponsorships and
providing sample products for our retail resellers to use is an
optimal strategy to increase sales. 
In addition: 

--  Our products are currently sold in over 110 countries, with the goal
    of reaching 175 countries in the next few years
--  Our products are available in over 10,500 U.S. retail outlets with the
    goal of reaching 20,000+ in the next few years
--  Retail stores include GNC and Vitamin Shoppe, as well as over 100
    online stores, including,,,,,,, Dick's Sporting Goods, and many more

We recently renegotiated our terms with our manufacturers and have
refined our distribution model, and as a result, we should experience
better sales margins. On top of this, we have reviewed our operating
costs and are cutting several non- essential expenses. We also
recently launched a new product called Amino1. To date, it is the
fastest growing product (sku) we have ever had here at MusclePharm. 
Finally, in mid 2012, we hired an experienced CFO, Gary Davis, who
most recently served as executive vice president and CFO for for almost six years. is a world
leader in sports fitness and nutritional supplements and is a very
large website for nutritional products. Gary's experience includes
extensive experience as a chief financial officer with strengths in
external and management reporting and analysis, accounting, tax,
treasury, human resources and risk management functions in public and
private companies along with the dietary supplement industry. He
provides strength and direction for the demands and growth of
Going from no revenues to over $78 million in less than four years
was impressive growth, but all of us here at MusclePharm have the
goal of reaching $500 million in annual sales -- but only at a
profitable level. We are excited about focusing on our core business
without the after effects of burdensome financings.  
If you have any questions regarding our Company, please feel free to
contact me directly or our office at the numbers listed below. 
Brad Pyatt
 Chief Executive Officer  
MusclePharm is a healthy lifestyle company that develops and
manufactures nutritional supplements that address active lifestyles,
including muscle building, weight loss and maintaining general
fitness through a daily nutritional supplement regimen. The products
are formulated through a six-stage research process using the
expertise of leading nutritional scientists. MusclePharm's products
are sold to consumers in more than 110 countries and available in
over 10,500 U.S. retail outlets, including Dick's Sporting Goods,
GNC, Vitamin Shoppe and Vitamin World. MusclePharm products also are
sold through more than 100 online channels globally, including, and For more information,
please visit  
 This release and the letter herein
contains forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the
Securities and Exchange Act of 1934, as amended. Statements that are
not a description of historical facts constitute forward-looking
statements and may often, but not always, be identified by the use of
such words as "expects", "anticipates", "intends", "estimates",
"plans", "potential", "possible", "probable", "believes", "seeks",
"may", "will", "should", "could" or the negative of such terms or
other similar expressions. Actual results may differ materially from
those set forth in this release due to the risks and uncertainties
inherent in the Company's business. More detailed information about
the Company and the risk factors that may affect the realization of
forward-looking statements is set forth in the Company's Annual
Report on Form 10-K/A for the fiscal year ended Decemb
er 31, 2011,
the Company's Quarter Reports on Form 10-Q and other filings
submitted by the Company to the SEC, copies of which may be obtained
from the SEC's website at Readers are cautioned not to
place undue reliance on these forward-looking statements, which speak
only as of the date hereof. All forward-looking statements are
qualified in their entirety by this cautionary statement and the
Company undertakes no obligation to revise or update this release to
reflect events or circumstances after the date hereof.   
MusclePharm Investor  
The Del Mar Consulting Group, Inc.
Robert B. Prag
Telephone: 858-794-9500
Alex Partners, LLC
Scott Wilfong
Telephone: 425-242-0891
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