As filed with the Securities and ExchangeCommission on August 21, 2013

Registration No. 333-                 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-1

REGISTRATION STATEMENT UNDER THE SECURITIESACT OF 1933

MusclePharm Corporation

(Exact name of registrant as specified inits charter)

4721 Ironton Street, Building A

Denver, Colorado 80239

Telephone: (303) 396-6100

(Address, including zip code, and telephonenumber, including area code, of registrant’s principal executive offices)

Brad J. Pyatt

Co-Chairman, Chief Executive Officerand President

MusclePharm Corporation

5348 Vegas Drive

Las Vegas, Nevada 89108

Telephone: (702) 953-1890

(Name, address, including zip code, andtelephone number, including area code, of agent for service)

Copies to:

Harvey J. Kesner, Esq.

Edward H. Schauder, Esq.
Sichenzia Ross Friedman Ference LLP
61 Broadway, 32nd Floor
New York, New York 10006
Telephone: (212) 930-9700
Fax: (212) 930-9725

Approximate date of commencement of proposedsale to the public:

As soon as practicable after this RegistrationStatement is declared effective.

Ifany of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415under the Securities Act of 1933, check the following box:  ¨

Ifthis Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the SecuritiesAct, please check the following box and list the Securities Act registration statement number of the earlier effective registrationstatement for the same offering. ¨

Ifthis Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the followingbox and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.¨

Ifthis Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the followingbox and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.¨

Indicate by check mark whether the registrantis a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitionsof “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2of the Exchange Act.

The Registrant hereby amends this RegistrationStatement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendmentwhich specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) ofthe Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securitiesand Exchange Commission, acting pursuant to Section 8(a), may determine.

CALCULATION OF REGISTRATION FEE

780,000 Shares of Common Stock

We are registering an aggregate of 780,000 shares of commonstock, $0.001 par value per share (the “Common Stock”) of MusclePharm Corporation (referred to herein as “we”,“us”, “our”, “MusclePharm”, “Registrant”, or the “Company”) for resaleby certain of our shareholders identified in this prospectus (the “Selling Shareholder”), all of which were issuedto them pursuant to an Endorsement Licensing and Co-Branding Agreement (the “Co-Branding Agreement”) entered intobetween the Company and the sole Selling Shareholder (the “Resale Shares”). Please see “Selling Shareholder”beginning at page 68.

The Selling Shareholder may offer to sell the Resale Sharesat fixed prices, at prevailing market prices at the time of sale, at varying prices or at negotiated prices, and will pay all brokeragecommissions and discounts attributable to the sale of such shares. The Selling Shareholder will receive all of the net proceedsfrom the offering of their shares.

The Resale Shares may be sold by the Selling Shareholder toor through underwriters or dealers, directly to purchasers or through agents designated from time to time. For additional informationregarding the methods of sale you should refer to the section entitled “Plan of Distribution” in this Prospectus.

Our common stock is presently quoted onthe OTCBB under the symbol “MSLP.OB”. On August 19, 2013, the last reported sale price for our common stock on theOTC BB was $11.05 per share.

Our business and an investment in our securitiesinvolve a high degree of risk. See “Risk Factors” beginning on page 9 of this prospectus for a discussion ofinformation that you should consider before investing in our securities.

Neither the Securities and Exchange Commission nor any statesecurities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete.Any representation to the contrary is a criminal offense.

The date of this prospectusis August      , 2013

TABLE OF CONTENTS

You should rely only on the information contained in this prospectusor in any free writing prospectus that we may specifically authorize to be delivered or made available to you. We have not authorizedanyone to provide you with any information other than that contained in this prospectus or in any free writing prospectus we mayauthorize to be delivered or made available to you. We take no responsibility for, and can provide no assurance as to the reliabilityof, any other information that others may give you. This prospectus may only be used where it is legal to offer and sell our securities.The information in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of thisprospectus or any sale of our securities. Our business, financial condition, results of operations and prospects may have changedsince that date. We are not making an offer of these securities in any jurisdiction where the offer is not permitted.

PROSPECTUS SUMMARY

This summary highlights information contained elsewhere inthis prospectus and does not contain all of the information that you should consider in making your investment decision. Beforeinvesting in our securities, you should carefully read this entire prospectus, including our financial statements and therelated notes and the information set forth under the headings “Risk Factors” and “Management’s Discussionand Analysis of Financial Condition and Results of Operations” in each case included elsewhere in this prospectus.

Unless otherwise stated or the context requires otherwise,references in this prospectus to “MusclePharm”, the “Company”, “we”, “us”, or “our”refer to MusclePharm Corporation, and information in this prospectus gives effect to the 1-for-850 reverse stock split of our commonstock that we effected on November 26, 2012.

MusclePharm Corporation

Business Overview

MusclePharm Corporation was initially incorporated in the Stateof Nevada on August 4, 2006, under the name Tone in Twenty, for the purpose of engaging in the business of providing personal fitnesstraining using isometric techniques (“Tone in Twenty”).  Tone in Twenty was never able to raise the level of fundingnecessary to commence operations.  On February 18, 2010, the Company acquired all of the issued and outstanding equityand voting interests of Muscle Pharm, LLC, a Colorado limited liability company, in exchange for 26,000,000 pre-split shares ofthe Company’s common stock.  The shares were issued pursuant to that certain Securities Exchange Agreement, datedFebruary 1, 2010 (the “Securities Exchange Agreement”).  As a result of this transaction, Muscle Pharm, LLC becamea wholly owned subsidiary of the Company.  The 26,000,000 pre-split shares represented approximately 99.7% of the commonstock outstanding following the closing of such transaction.  As part of such transaction, the Company’s formerPresident sold his 366,662 pre-split shares to Muscle Pharm, LLC for $25,000 and these shares were then cancelled.

As part of the Securities Exchange Agreement, the Company agreedto seek shareholder approval of an amendment to the Company’s Articles of Incorporation changing the name of the Companyto MusclePharm Corporation.  This amendment was approved by a majority of the Company’s shareholders andthe name change became effective on March 1, 2010.

MusclePharm currently manufactures and markets wide-rangingvariety of high-quality sports nutrition products, including: Assault ^TM , Battle Fuel ^TM , Bullet Proof^TM , Combat ^TM , SHRED Matrix®, and Re-con®.  These products are comprised of amino acids,herb, and proteins scientifically tested and proven as safe and effective for the overall health of athletes.  Thesenutritional supplements were created to enhance the effects of workouts, repair muscles, and nourish the body for optimal physicalfitness.

Our Growth and Core Marketing Strategy

Our primary growth strategy is to:

Our Core Marketing Strategy

Our core marketing strategy is to brandMusclePharm as the “must have” fitness brand for workout enthusiasts and elite athletes. We seek to be known as TheAthletes 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 anoptimal strategy to increase sales.

Recent Developments

Reverse Stock Split and Increase in Number of AuthorizedShares of Common Stock

On November 26, 2012, we (i) effected a1-for-850 reverse stock split of our common stock, including a proportionate reduction in the number of authorized shares of ourcommon stock from 2.36 billion shares to 2.8 million shares of common stock, and (ii) amended our articles of incorporation toincrease the number of authorized shares of common stock (post reverse stock split) from 2,941,177 to 100 million effective November27, 2012. Unless otherwise indicated, all share and per share amounts in this document have been changed to give effect to thereverse stock split.

Conversion of Warrants into Common Stock

In late September 2012, we issued 512,675shares of our common stock to several accredited investors pursuant to conversions of warrants to purchase an aggregate of 723,747shares of our common stock. As a result of these warrant conversions and other extinguishments of derivative liabilities duringthe quarter ended September 30, 2012, our stockholders’ deficit decreased from $11,013,113 at June 30, 2012 to $7,297,593at September 30, 2012 and our derivative liabilities decreased from $7,908,960 at June 30, 2012 to $24,889 at September 30, 2012.On December 5, 2012, we converted a warrant exercisable for 4,902 shares of common stock into 3,677 shares of our common stock.Thereafter, our derivative liability was reduced to approximately $300 as of December 5, 2012.

Registered Direct Offerings

On February 4, 2013, we completed the finalclosing of our registered direct offering of an aggregate of 1,500,000 shares of our Series D Convertible Preferred Stock, at apublic offering price of $8.00 per share pursuant to an offering registered with the Securities and Exchange Commission (“SEC”).Each share of Series D Convertible Preferred Stock is convertible into two shares of common stock, subject to adjustment. Ournet proceeds from the offering were approximately $10.8 million after placement agent discounts, and other offering expenses of$1.2 million. Net proceeds from this offering were used to reduce indebtedness and for other corporate purposes.

As of August 19, 2013, 1,355,000 Series D shares have been convertedinto 2,710,000 shares of the Company’s common stock and 145,000 shares of Series D preferred stock remain outstanding.

Private Placements of Common Stock

On March 26, 2013, the Company enteredinto subscription agreements with non-affiliated accredited investors for the issuance of 703,236 shares of common stock pursuantto exemptions from registration under federal and state securities laws. The shares of common stock were sold for $8.50 per share.The gross proceeds to the Company of $6.0 million were reduced by commissions and issuance costs of $115,000.

On May 3, 2013, the Company entered intoa subscription agreement with one non-affiliated accredited investor for the issuance of 100,000 shares of common stock pursuantto exemptions from federal and state securities laws. The shares of common stock were sold for $8.50 per share.

On June 3, 2013, the Company entered intoa subscription agreement with one non-affiliated accreditor investor for the issuance of 150,000 shares of common stock pursuantto exemptions from registration under federal and state securities laws. The shares of common stock were sold for $10.00 per share.The gross proceeds of $1,500,000 were reduced by commissions and issuance costs of $75,000.

On August 8, 2013, the Company enteredinto a subscription agreement with six non-affiliated accredited investors for the issuance of 238,096 shares of common stock pursuantto exemptions from federal and state securities laws. The shares of common stock were sold for $10.50 per share.

Co-Branding Agreement

On July 26, 2013, the Company entered intoan Endorsement Licensing and Co-Branding Agreement by and among Marine MP, LLC, and Fitness Publications, Inc. (Marine MP, LLCand Fitness Publications, Inc. together, the “AS Parties”). Under the terms of the Agreement, a special Arnold Schwarzeneggerproduct line of between 4 and 8 products will be marketed under Mr. Schwarzenegger’s name and likeness.

Pursuant to the Agreement, Mr. Schwarzeneggergranted the Company a license to use, subject to Mr. Schwarzenegger’s approval, worldwide, Mr. Schwarzenegger’s nameand Appearance Rights (as defined in the Co-Branding Agreement), oral and written endorsements, and approved videos, images, appearance,likeness, voice recording, signature and professional background to advertise the Company’s products. Additionally, Mr. Schwarzeneggerhas agreed to make certain appearance on behalf of the Company throughout the term of the Agreement.

Pursuant to the Agreement, as compensationand in consideration of the license granted by Mr. Schwarzenegger and the services he shall provide, Marine MP, LLC shall receive(i) royalty payments based upon a percentage of net sales of licensed products throughout the term of the Agreement, subject tocertain minimum amounts, and (ii) 780,000 shares of the Company’s restricted common stock (the “Stock Compensation”).The Company agreed to file this “resale” registration statement with the SEC covering all shares of common stock issuedpursuant to the Agreement by August 21, 2013.

Selected Risks Associated With Our Business

Our business is subject to numerous risks described in the sectionentitled “Risk Factors” and elsewhere in this prospectus. You should carefully consider these risks before making aninvestment. Some of these risks include:

Corporate Information

We were incorporated in Nevada on August 4, 2006, under thename “Tone in Twenty”. On February 18, 2010, Tone in Twenty acquired all of the issued and outstanding equity and votinginterests of Muscle Pharm, LLC, a Colorado limited liability company, in exchange for 30,589 shares of its common stock. As a resultof this transaction, Muscle Pharm, LLC became a wholly owned subsidiary of Tone in Twenty, and Tone in Twenty changed its nameto “MusclePharm Corporation.” Our principal executive offices are located at 4721 Ironton Street, Building A, Denver,Colorado 80239 and our telephone number is (303) 396-6100. Our website address is http://www.musclepharm.com. The information on,or that can be accessed through, our website is not part of this prospectus.

Summary of the Offering

Unless we indicate otherwise, allinformation in this prospectus:

SUMMARY CONSOLIDATED FINANCIALDATA

The following selected financial information is derived fromthe Company’s Financial Statements appearing elsewhere in this Prospectus and should be read in conjunction with the Company’sFinancial Statements, including the notes thereto, appearing elsewhere in this Prospectus. All share amounts and per share amountsreflect the completed 1-for-850 reverse stock split. The results indicated below are not necessarily indicative of our future performance.

You should read this information together with the sectionsentitled “Capitalization”, “Management’s Discussion and Analysis of Financial Condition and Resultsof Operations” and our consolidated financial statements and related notes included elsewhere in this prospectus.

Summary of Statements of Operations

Statement of Financial Position

RISK FACTORS

Any investment in our securities involves a high degree ofrisk. Investors should carefully consider the risks described below and all of the information contained in this prospectus beforedeciding whether to purchase our securities. Our business, financial condition and results of operations could be materially adverselyaffected by these risks if any of them actually occur. This prospectus also contains forward-looking statements that involve risksand uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a resultof certain factors, including the risks we face as described below and elsewhere in this prospectus.

Risks Related to Our Business and Industry

Our business and operations are experiencing rapid growth.If we fail to effectively manage our growth, our business and operating results could be harmed.

We have experienced and expect to continueto experience rapid growth in our operations, which has placed, and will continue to place, significant demands on our management,and our operational and financial infrastructure. If we do not effectively manage our growth, we may fail to attain operationalefficiencies we are seeking, timely deliver products to our customers in sufficient volume or the quality of our products couldsuffer, which could negatively affect our operating results. To effectively manage this growth, we expect we will need to hireadditional persons, particularly in sales and marketing, and we will need to continue to improve significantly our operational,financial and management controls and our reporting systems and procedures. These additional employees, systems enhancements andimprovements will require significant capital expenditures and management resources. Failure to implement these proposed growthobjectives would likely hurt our ability to manage our growth and our financial position.

As of April 10, 2013, management has takenover the shipping of most product, other than drop shipments, to our customers from our 152,000 square foot distribution centerin Franklin, Tennessee. We have hired a warehouse manager, and relocated two shipping logistic individuals from our Denver, Coloradooffice to manage shipping. We also hired several local warehouse individuals to manage this process. We believe this efficiencywill improve our shipping time and reduce our overall cost of goods sold.

Additionally, the Company has hired sixnew sales and marketing individuals to continue the expansion and growth of sales. The finance team has added four new staff membersand our board of directors appointed a new Chief Financial Officer on July 1, 2012. New controls and procedures have been implementedover sales orders and discounting as well as new financial controls, budgeting processes, daily and monthly monitoring reportsalong with dashboard reporting for aiding management in making good decisions.

The Company has appointed a seven memberBoard of Directors, three of which are deemed independent by the board. The Company has also appointed an audit committee, a nominatingand corporation governance committee, and a compensation committee. Regular board meetings are held and task lists are reviewedand checked off with members of outside counsel to mitigate issues and promote further improvements around internal controls andreporting which the Company believes is much improved but not yet complete.

Our failure to respond appropriately to competitive challenges,changing consumer preferences and demand for new products could significantly harm our customer relationships and product sales.

The nutritional sports supplement industryis characterized by intense competition for product offerings and rapid and frequent changes in consumer demand. Our failure topredict accurately product trends could negatively impact our products and cause our revenues to decline.

Our success with any particular productoffering (whether new or existing) depends upon a number of factors, including our ability to:

Products often have to be promoted heavilyin stores or in the media to obtain visibility and consumer acceptance. Acquiring distribution for products is difficult and oftenexpensive due to slotting and other promotional charges mandated by retailers. Products can take substantial periods of time todevelop consumer awareness, consumer acceptance and sales volume. Accordingly, some products may fail to gain or maintain sufficientsales volume and as a result may have to be discontinued. In a highly competitive marketplace it may be difficult to have retailersopen stock-keeping units (sku’s) for new products.

Our management has determined thatcertain disclosure controls and procedures may be ineffective, even though they have been improved upon, which could result inmaterial misstatements in our financial statements.

Our management is responsible for establishingand maintaining adequate internal control over our financial reporting, as defined in Rule 13a-15(f) under the Exchange Act. Asof December 31, 2012, our management determined that some of our disclosure controls and procedures were ineffective due to weaknessesin our financial closing process.

We intend to implement remedial measuresdesigned to address the ineffectiveness of our disclosure controls and procedures, such as hiring several individuals with significantaccounting, auditing and financial reporting experience and segregating our internal and external financial reporting among ourlarger financing and accounting staff, implementing more specific segregation of our accounting software and providing historicalinformation more timely, such as monthly budgeting analysis and cash reporting. We have also adopted and implemented written proceduresto document purchase orders, product discounts and product transition flow as well as analysis of our cost of goods sold. If theseremedial measures are insufficient to address the ineffectiveness of our disclosure controls and procedures, or if material weaknessesor significant deficiencies in our internal control are discovered or occur in the future and the ineffectiveness of our disclosurecontrols and procedures continues, we may fail to meet our future reporting obligations on a timely basis, our consolidated financialstatements may contain material misstatements, we could be required to restate our prior period financial results, our operatingresults may be harmed, we may be subject to class action litigation, and if we gain a listing on a stock exchange, our common stockcould be delisted from that exchange. Any failure to address the ineffectiveness of our disclosure controls and procedures couldalso adversely affect the results of the periodic management evaluations regarding the effectiveness of our internal control overfinancial reporting and our disclosure controls and procedures that are required to be included in our annual report on Form 10-K.Internal control deficiencies and ineffective disclosure controls and procedures could also cause investors to lose confidencein our reported financial information. We can give no assurance that the measures we plan to take in the future will remediatethe ineffectiveness of our disclosure controls and procedures or that any material weaknesses or restatements of financial resultswill not arise in the future due to a failure to implement and maintain adequate internal control over financial reporting or adequatedisclosure controls and procedures or circumvention of these controls. In addition, even if we are successful in strengtheningour controls and procedures, in the future those controls and procedures may not be adequate to prevent or identify irregularitiesor errors or to facilitate the fair presentation of our consolidated financial statements.

If we fail to comply with the rulesunder the Sarbanes-Oxley Act of 2002 related to disclosure controls and procedures, or, if we discover material weaknesses andother deficiencies in our internal control and accounting procedures, our stock price could decline significantly and raising capitalcould be more difficult.

If we fail to comply with the rules underthe Sarbanes-Oxley Act of 2002 related to disclosure controls and procedures, or, if we discover additional material weaknessesand other deficiencies in our internal control and accounting procedures, our stock price could decline significantly and raisingcapital could be more difficult. Moreover, effective internal controls are necessary for us to produce reliable financial reportsand are important to helping prevent financial fraud. If we cannot provide reliable financial reports or prevent fraud, our businessand operating results could be harmed, investors could lose confidence in our reported financial information, and the trading priceof our common stock could drop significantly. In addition, we cannot be certain that additional material weaknesses or significantdeficiencies in our internal controls will not be discovered in the future.

Our industry is highly competitive,and our failure to compete effectively could adversely affect our market share, financial condition and future growth.

The nutritional supplement industry ishighly competitive with respect to:

Most of our competitors are larger moreestablished and possess greater financial, personnel, distribution and other resources than we have. We face competition in thehealth food channel from a limited number of large nationally known manufacturers, private label brands and many smaller manufacturersof dietary supplements.

We rely on a limited number of customersfor a substantial portion of our sales, and the loss of or material reduction in purchase volume by any of these customers wouldadversely affect our sales and operating results.

For the year ended December 31, 2012, twoof our customers accounted for an aggregate of approximately 45% of our sales. Our largest customer for the year ended December31, 2012, accounted for 33% of our sales. For the year ended December 31, 2011, two customers accounted for approximately 55% ofour sales and our largest customer represented 41% of our sales.

For the six months ended June 30, 2013,two of our customers accounted for an aggregate of approximately 43% of our sales. Our largest customer for the six months endedJune 30, 2013, accounted for 31% of our sales. For the six months ended June 30, 2012, two of our customers accounted for an aggregateof approximately 57% of our sales. Our largest customer for the six months ended June 30, 2012, accounted for 40% of our sales.

The loss of any of our major customers,a significant reduction in purchases by any major customer, or, any serious financial difficulty of a major customer, could havea material adverse effect on our sales and results of operations.

Adverse publicity or consumer perceptionof our products and any similar products distributed by others could harm our reputation and adversely affect our sales and revenues.

We believe we are highly dependent uponpositive consumer perceptions of the safety and quality of our products as well as similar products distributed by other sportsnutrition supplement companies. Consumer perception of sports nutrition supplements and our products in particular can be substantiallyinfluenced by scientific research or findings, national media attention and other publicity about product use. Adverse publicityfrom these sources regarding the safety, quality or efficacy of nutritional supplements and our products could harm our reputationand results of operations. The mere publication of news articles or reports asserting that such products may be harmful or questioningtheir efficacy could have a material adverse effect on our business, financial condition and results of operations, regardlessof whether such news articles or reports are scientifically supported or whether the claimed harmful effects would be present atthe dosages recommended for such products.

We rely on highly skilled personneland, if we are unable to retain or motivate key personnel, hire qualified personnel, we may not be able to grow effectively.

Our performance largely depends on thetalents and efforts of highly skilled individuals. Our future success depends on our continuing ability to identify, hire, develop,motivate and retain highly skilled personnel for all areas of our organization, particularly sales and marketing. Competition inour industry for qualified employees is intense. In addition, our compensation arrangements, such as our bonus programs, may notalways be successful in attracting new employees or retaining and motivating our existing employees. Our continued ability to competeeffectively depends on our ability to attract new employees and to retain and motivate our existing employees.

If we are unable to retain key personnel,our ability to manage our business effectively and continue our growth could be negatively impacted.

Our management employees include Brad J.Pyatt, L. Gary Davis, John H. Bluher, Richard Estalella, and Cory J. Gregory. These key management employees are primarily responsiblefor our day-to-day operations, and we believe our success depends in large part on our ability to retain them and to continue toattract additional qualified individuals to our management team. Currently, we have executed employment agreements with our keymanagement employees. The loss or limitation of the services of any of our key management employees or the inability to attractadditional qualified personnel could have a material adverse effect on our business and results of operations.

Our operating results may fluctuate,which makes our results difficult to predict and could cause our results to fall short of expectations.

Our operating results may fluctuate asa result of a number of factors, many of which may be outside of our control. As a result, comparing our operating results on aperiod-to-period basis may not be meaningful, and you should not rely on our past results as an indication of our future performance.Our quarterly, year-to-date, and annual expenses as a percentage of our revenues may differ significantly from our historical orprojected rates. Our operating results in future quarters may fall below expectations. Each of the following factors may affectour operating results:

Because our business is changing and evolving,our historical operating results may not be useful to you in predicting our future operating results.

The continuing effects of the mostrecent global economic crisis may impact our business, operating results, or financial condition.

The global economic crisis that began in2008 has caused disruptions and extreme volatility in global financial markets and increased rates of default and bankruptcy, andhas impacted levels of consumer spending. These macroeconomic developments could negatively affect our business, operating results,and financial condition. For example, if consumer spending decreases, this may result in lower sales.

We may be exposed to material productliability claims, which could increase our costs and adversely affect our reputation and business.

As a marketer and distributor of productsdesigned for human consumption, we could be subject to product liability claims if the use of our products is alleged to have resultedin injury. Our products consist of vitamins, minerals, herbs and other ingredients that are classified as dietary supplements andin most cases are not subject to pre-market regulatory approval in the United States or internationally. Previously unknown adversereactions resulting from human consumption of these ingredients could occur.

We have not had any product liability claimsfiled against us, but in the future we may be subject to various product liability claims, including among others that our productshad inadequate instructions for use, or inadequate warnings concerning possible side effects and interactions with other substances.The cost of defense can be substantially higher than the cost of settlement even when claims are without merit. The high cost todefend or settle product liability claims could have a material adverse effect on our business and operating results.

Our insurance coverage or third partyindemnification rights may not be sufficient to cover our legal claims or other losses that we may incur in the future.

We maintain insurance, including property,general and product liability, and workers’ compensation to protect ourselves against potential loss exposures. In the future,insurance coverage may not be available at adequate levels or on adequate terms to cover potential losses, including on terms thatmeet our customer’s requirements. If insurance coverage is inadequate or unavailable, we may face claims that exceed coveragelimits or that are not covered, which could increase our costs and adversely affect our operating results.

Our intellectual property rightsare valuable, and any inability to protect them could reduce the value of our products and brand.

We have invested significant resourcesto protect our brands and intellectual property rights. However, we may be unable or unwilling to strictly enforce our intellectualproperty rights, including our trademarks, from infringement. Our failure to enforce our intellectual property rights could diminishthe value of our brands and product offerings and harm our business and future growth prospects.

We may be subject to intellectualproperty rights claims, which are costly to defend, could require us to pay damages and could limit our ability to sell some ofour products.

Our industry is characterized by vigorouspursuit and protection of intellectual property rights, which has resulted in protracted and expensive litigation for several companies.Third parties may assert claims of misappropriation of trade secrets or infringement of intellectual property rights against usor against our end customers or partners for which we may be liable.

As our business expands, the number ofproducts and competitors in our markets increases and product overlaps occur, infringement claims may increase in number and significance.Intellectual property lawsuits are subject to inherent uncertainties due to the complexity of the technical issues involved, andwe cannot be certain that we would be successful in defending ourselves against intellectual property claims. Further, many potentiallitigants have the capability to dedicate substantially greater resources than we can to enforce their intellectual property rightsand to defend claims that may be brought against them. Furthermore, a successful claimant could secure a judgment that requiresus to pay substantial damages or prevents us from distributing products or performing certain services.

An increase in product returns couldnegatively impact our operating results and profitability.

We permit the return of damaged or defectiveproducts and accept limited amounts of product returns in certain instances. While such returns have historically been nominaland within management’s expectations and the provisions established, future return rates may differ from those experiencedin the past. Any significant increase in damaged or defective products or expected returns could have a material adverse effecton our operating results for the period or periods in which such returns materialize.

We have no manufacturing capacityand anticipate continued reliance on third-party manufacturers for the development and commercialization of our products.

We do not currently operate manufacturingfacilities for production of our products. We lack the resources and the capabilities to manufacture our products on a commercialscale. We do not intend to develop facilities for the manufacture of products in the foreseeable future. We rely on third-partymanufacturers to produce bulk products required to meet our sales needs. We plan to continue to rely upon contract manufacturersto manufacture commercial quantities of our products.

Our contract manufacturers’ failureto achieve and maintain high manufacturing standards, in accordance with applicable regulatory requirements, or the incidence ofmanufacturing errors, could result in consumer injury or death, product shortages, product recalls or withdrawals, delays or failuresin product testing or delivery, cost overruns or other problems that could seriously harm our business. Contract manufacturersoften encounter difficulties involving production yields, quality control and quality assurance, as well as shortages of qualifiedpersonnel. Our existing manufacturers and any future contract manufacturers may not perform as agreed or may not remain in thecontract manufacturing business. In the event of a natural disaster, business failure, strike or other difficulty, we may be unableto replace a third-party manufacturer in a timely manner and the production of our products would be interrupted, resulting indelays, additional costs and reduced revenues.

A shortage in the supply of key rawmaterials could increase our costs or adversely affect our sales and revenues.

All of our raw materials for our productsare obtained from third-party suppliers. Since all of the ingredients in our products are commonly used, we have not experiencedany shortages or delays in obtaining raw materials. If circumstances changed, shortages could result in materially higher raw materialprices or adversely affect our ability to have a product manufactured. Price increases from a supplier would directly affect ourprofitability if we are not able to pass price increases on to customers. Our inability to obtain adequate supplies of raw materialsin a timely manner or a material increase in the price of our raw materials could have a material adverse effect on our business,financial condition and results of operations.

Because we are subject to numerouslaws and regulations, and we may become involved in litigation from time to time, we could incur substantial judgments, fines,legal fees and other costs.

Our industry is highly regulated. The manufacture,labeling and advertising for our products are regulated by various federal, state and local agencies as well as those of each foreigncountry to which we distribute. These governmental authorities may commence regulatory or legal proceedings, which could restrictthe permissible scope of our product claims or the ability to manufacture and sell our products in the future. The U.S. Food andDrug Administration, or FDA, regulates our products to ensure that the products are not adulterated or misbranded. Failure to complywith FDA requirements may result in, among other things, injunctions, product withdrawals, recalls, product seizures, fines andcriminal prosecutions. Our advertising is subject to regulation by the Federal Trade Commission, or FTC, under the Federal TradeCommission Act. In recent years the FTC has initiated numerous investigations of dietary supplement and weight loss products andcompanies. Additionally, some states also permit advertising and labeling laws to be enforced by private attorney generals, whomay seek relief for consumers, seek class action certifications, seek class wide damages and product recalls of products sold byus. Any of these types of adverse actions against us by governmental authorities or private litigants could have a material adverseeffect on our business, financial condition and results of operations.

A member of our management team hasbeen involved in a bankruptcy proceeding and other failed business ventures that may expose us to assertions that we are not ableto effectively manage our business, which could have a material adverse effect on our business and your investment in our securities.

Our chief executive officer and co-chairmanof our board of directors, Brad J. Pyatt, has been involved in a personal bankruptcy and other failed business ventures. This mayexpose us to assertions by others that our management team may not know how to effectively run a business. To address this risk,our board of directors has devoted significant time and energy to bolstering our management team with individuals who have publiccompany experience and financial expertise, as well as adding independent board members. Notwithstanding these efforts, if ourbusiness partners and investors do not have confidence in our management team, it could have a material adverse effect on our businessand your investment in our company.

Because certain of our stockholderscontrol a significant number of shares of our common stock, they may have effective control over actions requiring stockholderapproval.

As of August 19, 2013, our directors, executiveofficers, and their respective affiliates, beneficially own approximately 4.64% of our outstanding shares of common stock. Also,two of our executive officers own 51 shares of our Series B Preferred Stock, which has voting control of the Company. As a result,these stockholders, acting together, would have the ability to control the outcome of matters submitted to our stockholders forapproval, including the election of directors and any merger, consolidation or sale of all or substantially all of our assets.In addition, these stockholders, acting together, would have the ability to control the management and affairs of our company.Accordingly, this concentration of ownership might harm the market price of our common stock by:

The conversion reset provision relatingto our Series D Preferred Stock could result in difficulty for us to obtain future equity financing.

Because the conversion price reset provisionsrelating to our Series D Preferred Stock discussed above are so significant and to the potential detriment of common stockholders,it may make it more difficult for us to raise any future equity capital. This potential difficulty should be reviewed in lightof our existing levels of little capital and significant working capital deficit. As of August 19, 2013 approximately 90% of thepreferred stock issued in the Series D offering has been converted to common stock, greatly reducing this risk.

We may, in the future, issue additionalshares of common stock, which would reduce investors’ percent of ownership and may dilute our share value.

Our articles of incorporation, as amended,authorize the issuance of 100,000,000 shares of common stock and 10,000,000 shares of preferred stock, of which (i) 5,000,000 shareshave been designated as Series A Convertible Preferred Stock, (ii) 51 shares have been designated as Series B Preferred Stock,(iii) 500 shares have been designated as Series C Convertible Preferred Stock and (iv) 1,600,000 shares have been designated asSeries D Convertible Preferred Stock. The articles of incorporation authorize our board of directors to prescribe the series andthe voting powers, designations, preferences, limitations, restrictions and relative rights of any undesignated shares of our preferredstock. The future issuance of common stock and preferred stock may result in substantial dilution in the percentage of our commonstock held by our then existing stockholders. We may value any common stock or preferred stock issued in the future on an arbitrarybasis. The issuance of common stock for future services or acquisitions or other corporate actions may have the effect of dilutingthe value of the shares held by our investors, and might have an adverse effect on any trading market for our common stock.

We may issue additional shares ofpreferred stock in the future that may adversely impact your rights as holders of our common stock.

Our articles of incorporation, as amended,authorize us to issue shares of preferred stock in various series. Currently, we have 51 shares of Series B Preferred Stock issuedand outstanding, which shares have voting control of the Company. Each share of our Series A Preferred Stock is convertible into200 shares of our common stock although no shares of this series are outstanding. Each shares of our Series D Convertible PreferredStock is convertible into two shares of our common stock. In addition, our board of directors has the authority to fix and determinethe relative rights and preferences of our authorized but undesignated preferred stock, as well as the authority to issue sharesof such preferred stock, without further stockholder approval. As a result, our board of directors could authorize the issuanceof a series of preferred stock that would grant to holders preferred rights to our assets upon liquidation, the right to receivedividends before dividends are declared to holders of our common stock, and the right to the redemption of such preferred stock,together with a premium, prior to the redemption of the common stock. To the extent that we do issue such additional shares ofpreferred stock, your rights as holders of common stock could be impaired thereby, including, without limitation, dilution of yourownership interests in us. In addition, shares of preferred stock could be issued with terms calculated to delay or prevent a changein control or make removal of management more difficult, which may not be in your interest as a holder of common stock.

Our common stock is quoted on theOTCBB which may have an unfavorable impact on our stock price and liquidity.

Our common stock is quoted on the OTCBB.The OTCBB is a significantly more limited market than the New York Stock Exchange or the NASDAQ Stock Market. The quotation ofour shares on the OTCBB may result in a less liquid market available for existing and potential stockholders to trade shares ofour common stock, could depress the trading price of our common stock and could have a long-term adverse impact on our abilityto raise capital in the future.

A DTC “Chill” on theelectronic clearing of trades in our securities in the future may affect the liquidity of our stock and our ability to raise capital.

Because our common stock is considereda “penny stock,” there is a risk that the Depository Trust Company (“DTC”) may place a “chill” on the electronicclearing of trades in our securities. This may lead some brokerage firms to be unwilling to accept certificates and/or electronicdeposits of our stock and other securities and also some may not accept trades in our securities altogether. In the past, DTC hasplaced a deposit chill on our shares, and although the chill is currently removed, no assurance can be given that a chill willnot be reinstated in the future. A future DTC chill would affect the liquidity of our securities and make it difficult to purchaseor sell our securities in the open market. It may also have an adverse effect on our ability to raise capital because investorsmay be unable to easily resell our securities into the market. Our inability to raise capital on terms acceptable to us, if atall, could have a material and adverse effect on our business and operations.

Nevada corporations laws limit thepersonal liability of corporate directors and officers and require indemnification under certain circumstances.

Section 78.138(7) of the Nevada RevisedStatutes provides that, subject to certain very limited statutory exceptions or unless the articles of incorporation provide forgreater individual liability, a director or officer of a Nevada corporation is not individually liable to the corporation or itsstockholders for any damages as a result of any act or failure to act in his or her capacity as a director or officer, unless itis proven that the act or failure to act constituted a breach of his or her fiduciary duties as a director or officer and suchbreach involved intentional misconduct, fraud or a knowing violation of law. We have not included in our articles of incorporationany provision intended to provide for greater liability as contemplated by this statutory provision.

In addition, Section 78.7502(3) of theNevada Revised Statutes provides that to the extent a director or officer of a Nevada corporation has been successful on the meritsor otherwise in the defense of certain actions, suits or proceedings (which may include certain stockholder derivative actions),the corporation shall indemnify such director or officer against expenses (including attorneys’ fees) actually and reasonablyincurred by such director or officer in connection therewith.

You may experience substantial dilution in the event weissue common stock in the future at a price below $4.00 per share.

The terms of the Series D Preferred Stock require us to increasethe conversion rate in the event we issue common stock below $4.00 per share while any shares of Series D Preferred stock are outstanding,resulting in additional shares of common stock issuable upon conversion of shares of Series D Preferred Stock. For example, ifwe issue shares of common stock for little or no consideration, the certificate of designation for the Series D Preferred Stockprovides that such issuance will be deemed to be issued at $0.001 per share of common stock, which would have a substantial impacton the conversion rate of the Series D Preferred Stock, and your ownership percentage of the Company and likely, its value, woulddecrease accordingly.

Future financings through debt securities and preferredstock may restrict our operations.

If additional funds are raised through a credit facility orthe issuance of debt securities or preferred stock, lenders under the credit facility or holders of these debt securities or preferredstock would likely have rights that are senior to the rights of holders of our common stock, and any credit facility or additionalsecurities could contain covenants that would restrict our operations.

Our common stock price may be volatile and could fluctuatewidely in price, which could result in substantial losses for investors.

The market price of our common stock has historically been andis likely to be highly volatile and could fluctuate widely in price in response to various factors, many of which are beyond ourcontrol, including:

If our common stock becomes subject to the SEC’spenny stock rules, broker-dealers may experience difficulty in completing customer transactions and trading activity in our securitiesmay be adversely affected.

Unless our securities are listed on a national securities exchange,or we have net tangible assets of $5.0 million or more and our common stock has a market price per share of $5.00 or more, transactionsin our common stock will be subject to the SEC’s “penny stock” rules. If our common stock remains subject tothe “penny stock” rules promulgated under the Exchange Act, broker-dealers may find it difficult to effectuatecustomer transactions and trading activity in our securities may be adversely affected.

Under these rules, broker-dealers who recommend such securitiesto persons other than institutional accredited investors must:

As a result, if our common stock becomes or remains subjectto the penny stock rules, the market price of our securities may be depressed, and you may find it more difficult to sell sharesof our common stock after conversion of shares of Series D Preferred Stock.

We have not paid dividends on our common stock in thepast and do not expect to pay dividends on our common stock for the foreseeable future. Any return on investment may be limitedto the value of our common stock.

No cash dividends have been paid on our common stock. We expectthat any income received from operations will be devoted to our future operations and growth. We do not expect to pay cash dividendson our common stock in the near future. Payment of dividends would depend upon our profitability at the time, cash available forthose dividends, and other factors as our board of directors may consider relevant. If we do not pay dividends, our common stockmay be less valuable because a return on an investor’s investment will only occur if our stock price appreciates. Investorsin our common stock should not rely on an investment in our company if they require dividend income.

If securities or industry analysts do not publish researchor reports about our business, or if they change their recommendations regarding our stock adversely, our stock price and tradingvolume could decline.

The trading market for our common stock will be influenced bythe research and reports that industry or securities analysts publish about us or our business. We do not currently have and maynever obtain research coverage by industry or financial analysts. If no or few analysts commence coverage of us, the trading priceof our stock would likely decrease. Even if we do obtain analyst coverage, if one or more of the analysts who cover us downgradeour stock, our stock price would likely decline. If one or more of these analysts cease coverage of our company or fail to regularlypublish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock price or tradingvolume to decline.

A sale of a substantial number of shares of our commonstock including the Resale Shares registered herein may cause the price of our common stock to decline and may impair our abilityto raise capital in the future.

Our common stock is traded on the OTCBB and, despite certainincreases of trading volume from time to time, there have been periods when it could be considered “thinly-traded”,meaning that the number of persons interested in purchasing our common stock at or near bid prices at any given time may be relativelysmall or non-existent. Finance transactions resulting in a large amount of newly issued shares that become readily tradable, orother events that cause current stockholders to sell shares, could place downward pressure on the trading price of our stock. Inaddition, the lack of a robust resale market may require a stockholder who desires to sell a large number of shares of common stockto sell the shares in increments over time to mitigate any adverse impact of the sales on the market price of our stock.

If our stockholders sell, or the market perceives that our stockholdersintend to sell for various reasons, including the ending of restrictions on resale of substantial amounts of our common stock inthe public market, including shares issued upon the exercise of outstanding options, the market price of our common stock couldfall. Sales of a substantial number of shares of our common stock may make it more difficult for us to sell equity or equity-relatedsecurities in the future at a time and price that we deem reasonable or appropriate. We may become involved in securities classaction litigation that could divert management’s attention and harm our business.

The reverse stock split may decrease the liquidity ofthe shares of our common stock.

The liquidity of the shares of our common stock may be affectedadversely by the recently effected 1-for-850 reverse stock split given the reduced number of shares outstanding following the reversestock split, especially if the market price of our common stock does not increase as a result of the reverse stock split. In addition,the reverse stock split may have increased the number of stockholders who own odd lots (less than 100 shares) of our common stock,creating the potential for such stockholders to experience an increase in the cost of selling their shares and greater difficultyeffecting such sales.

Following the reverse stock split, the resulting marketprice of our common stock may not attract new investors, including institutional investors, and may not satisfy the investing requirementsof those investors. Consequently, the trading liquidity of our common stock may not improve.

Although we believe that a higher market price of our commonstock may help generate greater or broader investor interest, there can be no assurance that the recently effected 1-for-850 reversestock split will result in a share price that will attract new investors, including institutional investors. In addition, therecan be no assurance that the market price of our common stock will satisfy the investing requirements of those investors. As aresult, the trading liquidity of our common stock may not necessarily improve.

CAUTIONARY NOTE REGARDING FORWARD-LOOKINGSTATEMENTS AND INDUSTRY DATA

This prospectus contains forward-looking statements. Such forward-lookingstatements include those that express plans, anticipation, intent, contingency, goals, targets or future development and/or otherwiseare not statements of historical fact. These forward-looking statements are based on our current expectations and projections aboutfuture events and they are subject to risks and uncertainties known and unknown that could cause actual results and developmentsto differ materially from those expressed or implied in such statements.

In some cases, you can identify forward-looking statements byterminology, such 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. Accordingly,these statements involve estimates, assumptions and uncertainties that could cause actual results to differ materially from thoseexpressed in them. Any forward-looking statements are qualified in their entirety by reference to the factors discussed throughoutthis prospectus.

You should read this prospectus and the documents that we referenceherein and therein and have filed as exhibits to the registration statement, of which this prospectus is part, completely and withthe understanding that our actual future results may be materially different from what we expect. You should assume that theinformation appearing in this prospectus is accurate as of the date on the front cover of this prospectus only. Because the riskfactors referred to above could cause actual results or outcomes to differ materially from those expressed in any forward-lookingstatements made by us or on our behalf, you should not place undue reliance on any forward-looking statements. These risksand uncertainties, along with others, are described above under the heading “Risk Factors” beginning on page 8 of thisprospectus. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligationto update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or toreflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for us to predictwhich factors will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor,or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.We qualify all of the information presented in this prospectus, and particularly our forward-looking statements, by these cautionarystatements.

This prospectus also includes estimates of market size and industrydata that we obtained from industry publications and surveys and internal company sources. The industry publications and surveysused by management to determine market size and industry data contained in this prospectus have been obtained from sources believedto be reliable.

PRICE RANGE OF COMMON STOCK

Our shares of common stock were cleared for trading under thesymbol “TTWZ:OB” on the OTCBB on November 24, 2008, and later began trading on the OTCBB under the symbol “MSLP:OB”on April 22, 2010. Prior to this period, there was minimal trading in our common stock. The following table shows the reportedhigh and low bid quotations per share for our common stock based on information provided by the OTCBB. These prices reflect the1-for-850 reverse stock split of our common stock that we effected on November 26, 2012.

Quotations on the OTCBB reflect bid andask quotations, may reflect inter-dealer prices, without retail markup, markdown or commission, and may not represent actual transactions.In periods prior to April 22, 2010, there was no volume in our common stock. The closing price of our common stock on August 19,2013 was $11.05 per share.

As of August 19, 2013, there wereapproximately 389 holders of record of our common stock. This figure does not take into account those stockholders whosecertificates are held in street name by brokers and other nominees. We estimate that such holders number approximately3,700.

DIVIDEND POLICY

We have never declared dividends on ourcommon stock, and currently do not plan to declare dividends on shares of our common stock in the foreseeable future. We expectto retain our future earnings, if any, for use in the operation and expansion of our business. Subject to the foregoing, the paymentof cash dividends in the future, if any, will be at the discretion of our board of directors and will depend upon such factorsas earnings levels, capital requirements, our overall financial condition and any other factors deemed relevant by our board ofdirectors.

CAPITALIZATION

The following table sets forth our capitalization as of June30, 2013:

You should consider this table in conjunctionwith “Description of Securities” and our financial statements and the notes to those financial statements includedelsewhere in this prospectus.

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OFOPERATIONS

The following discussion and analysisshould be read together with our financial statements and the related notes appearing elsewhere in this prospectus. This discussioncontains forward-looking statements reflecting our current expectations that involve risks and uncertainties. See “CautionaryNote Regarding Forward-Looking Statements and Industry Data” for a discussion of the uncertainties, risks and assumptionsassociated with these statements. Actual results and the timing of events could differ materially from those discussed in our forward-lookingstatements as a result of many factors, including those set forth under “Risk Factors” and elsewhere in this prospectus.All share amounts and per share amounts in “Management’s Discussion and Analysis of Financial Condition and Resultsof Operations” reflect the 1-for-850 reverse stock split of our common stock that we effected on November 26, 2012.

Plan of Operation

We develop market and sell athlete-focused,high quality nutritional supplements primarily to specialty resellers. Our propriety and award winning products address activelifestyles including muscle building, weight loss, and maintaining general fitness through a daily nutritional supplement regimen.Our products are available in over 10,500 U.S. retail outlets, including Dick’s Sporting Goods, GNC, Vitamin Shoppe and VitaminWorld. We also sell our products in over 100 online channels, including bodybuilding.com, amazon.com, gnc.com and vitacost.com.Internationally, our nutritional supplements are sold in approximately 90 countries, and we expect that international sales willbe a significant part of our sales for the foreseeable future.

Our primary growth strategy is to:

Our core marketing strategy is to brandMusclePharm as the “must have” fitness brand for workout enthusiasts and elite athletes. We seek to be known as TheAthletes Company®, run by athletes who create their products for other athletes both professional and otherwise. We believethat our marketing mix of endorsers, sponsorships and providing sample products for our retail resellers to use is an optimal strategyto increase sales.

Results of Operations

Year ended December 31, 2012 compared to the year endedDecember 31, 2011.

Revenues

Our net revenues increased 290% to approximately$67.1 million for the year ended December 31, 2012, compared to approximately $17.2 million for the year ended December 31, 2011.Sales during the year ended December 31, 2012 increased due to increased awareness of our product brand. We have focused on anaggressive marketing plan to penetrate the market, as such, significant expenditures related to advertising and promotions havebeen experienced. The sales increase was also the result of capital spent on marketing and brand recognition with distributorsalong with endorsements and sponsorships. The Company’s many efforts for growth included hiring new managers, additionalsales and marketing staff, along with adding new products in an effort to continue to expand our customer base. Another growtharea was sales in the international markets. International sales are included in the results of operations and increased approximately$16.2 million or 405% to $20.2 million for the year ended December 31, 2012, compared to $4.0 million for the year ended December31, 2011.

Overall as a direct result of our aggressivemarketing plan, our products are currently being offered in more retail stores, both domestically and internationally, receivingbetter shelf placement, and receiving recognized awards compared to the prior period. The Company has an exclusive marketing arrangementwith the UFC, Ultimate Fighting Championships, which has called out MusclePharm as the Supplement of Choice for the UFC and atthe 2012 Bodybuilding.com Supplement Awards, we received three Awards of Excellence; (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 .

Gross Profit

Gross profit for the year ended December31, 2012 was approximately $14.3 million or 21% of revenue, compared to approximately $2.4 million or 14% of revenue for the yearended December 31, 2011. The increase was primarily due to the reduction to discounts as a percentage of sales and favorable termsfor manufacturing improvements in product pricing. For the year ended December 31, 2012, the discounts and allowances as a percentageof sales was 14% compared to the year ended December 31, 2011 which was 19%. We expect our focus on streamlining operations willincrease our operating efficiencies and will further improve our gross profit percentage.

General and Administrative Expenses

General and administrative expenses forthe year ended December 31, 2012 increased to $23.1 million, compared to $18.6 million for the year ended December 31, 2011. Our290% sales growth necessitated substantial increases in our general and administrative expenses and included $2.2 million in advertisingand promotions and $2.4 million in sponsorship and endorsements all used to promote brand and product awareness. We expect as wecontinue to promote our brand and products, these areas and levels of promotion will hold steady or increase relative to overallefforts to increase product awareness and sales. Salaries and benefits, excluding executive bonuses, also increased by $1.3 million;however, these were approximately 5% of sales for 2012 compared to approximately 11% of sales in the 2011 period.

Increases in investment advisory and legal fees of $3.1 millionwere a result of efforts required to obtain financing and dispute resolutions along with two consulting contracts that requireus to issue 8.4% of our common stock on up to a pre-determined ceiling as set forth in separate contract amendments.

The increase in all other general administrativeareas of $4.3 million along with significant items listed above, were partially offset by the decrease in stock based compensationof approximately $8.6 million.

The following table provides an overviewof expense categories and percentage of net revenue:

Operating Loss

Operating loss for the year ended December31, 2012 was approximately $8.7 million, compared to approximately $16.2 million for the year ended December 31, 2011.

Interest Expense

Interest expense for the year ended December31, 2012 was approximately $7.3 million, as compared to approximately $3.7 million for the year ended December 31, 2011. The increasein interest expense primarily relates to increased interest on debt of $0.6 million, increased amortization of debt issuance costsof $0.1 million and increased amortization of debt discounts of $2.9 million during the year ended December 31, 2012.

Other Expense

Other expenses for the year ended December31, 2012 were approximately $10.2 million, compared to approximately $7.1 million for the year ended December 31, 2011, an increaseof 44.7%. The components of our other expense are as follows:

Net Loss

Net loss for the year ended December 31,2012 was approximately $19 million, or $(13.00) per share, compared to the net loss of approximately $23.3 million or $(70.30)per share, for the year ended December 31, 2011. Inflation did not have a material impact on our operations for the years endedDecember 31, 2012 and 2011.

Liquidity and Capital Resources

The following table summarizes total currentassets, liabilities and working deficit at December 31, 2012, compared to December 31, 2011:

Our primary source of operating cash hasbeen from the sale of equity, the issuance of convertible secured promissory notes and other short-term debt as discussed below.

Company’s management believes thatwith increased sales expansion and the opening of the Franklin, Tennessee distribution center, there will be opportunities to increasesales; however, the Company may need to continue to raise capital in order execute the business plan, which includes buying moreinventory and broadening the sales platform. There can be no assurance that such capital will be available on acceptable termsor at all.

On December 4, 2012, we entered into a$1.0 million bridge loan to provide us with short-term financing.  In connection with the bridge loan, we entered intoa subscription agreement with six subscribers pursuant to which we issued an aggregate of $1.0 million principal amount of promissorynotes and 50,000 shares of common stock to the subscribers.  The promissory notes were repaid in January 2013.  Additionally,we granted the subscribers “piggy-back” registration rights for the shares of common stock in certain circumstances.

At December 31, 2012, we had cash of $0and a working capital deficit of approximately $11.6 million, compared to cash of approximately $0.7 million and a working capitaldeficit of approximately $13.7 million at December 31, 2011. The working capital deficit decrease of approximately $2.1 millionwas primarily due to a net decrease in derivative liabilities of approximately $7.0 million, an increase in accounts receivableof approximately $.7 million, offset by an increase in customer deposits of approximately $0.3 million, an increase in the currentportion of debt of approximately $3.2 million and an increase in accounts payable and accrued liabilities of approximately $2.4million.

Cash used in operating activities was approximately$0.7 million for the year ended December 31, 2012, as compared to cash used in operating activities of approximately $5.8 millionfor the year ended December 31, 2011. The decrease in cash used in operating activities of approximately $5.1 million was primarilydue to a decrease in net loss of approximately $4.3 million, an increased payables and customer deposits of approximately $4.3million, an increase in depreciation and amortization of approximately $0.3 million, a decrease in accounts receivable of approximately$1.5 million and an increase in amortization expense of approximately $2.3 offset by a decrease in stock and warrants issued forservices of approximately $3.4 million, a decrease in losses related to repayments and conversions of debt of approximately $0.6million, a decrease in derivative expense and fair value changes of approximately $1.1 million and a increases in prepaids, inventory,and other assets of approximately $1.2 million.

Cash used in investing activities increasedto $965,327 from $831,511 for the year ended December 31, 2012 and 2011, respectively, due to slightly higher spending on fixedassets. Future investments in property and equipment, as well as further development of our Internet presence will largely dependon available capital resources.

Cash flows provided by financing activitieswere approximately $1 million for the year ended December 31, 2012, compared to cash flows provided by financing activities ofapproximately $7.2 million for the year ended December 31, 2011. The approximately $6.2 million decrease was due to primarily tothe approximately $5.8 million in repayment of debt and approximately $0.5 million for the purchase of treasury stock offset byan increase in proceeds from issuance of debt of approximately $0.8 million offset by an increase in proceeds from issuance ofcommon stock and warrants of approximately $0.7 million.

Results of Operations

For the Three Months Ended June 30, 2013 and 2012 (unaudited):

Sales - gross

Gross sales increased approximately $9.6million or 51% to $28,516,000 for the three months ended June 30, 2013, compared to $18,869,000 for the three months ended June30, 2012. The increase in sales was due primarily to increased awareness of our product brand, combined with hiring additionalsales and marketing staff, and adding new products in an effort to expand our customer base. Since inception, we have focused onan aggressive marketing plan to penetrate the market. As such, significant promotional expenditures have been made to increaseproduct sales through adding new customers and expanding our product line.

In this quarter the Company launched awomen’s line named FitMiss. The momentum is beginning to show increasing sales for this new product line. The Company believesit has a good position for market share with a women’s line of products. The Company is also considering other new products.Overall as a direct result of our aggressive marketing plan, our products are currently being offered in more retail stores, bothdomestically and internationally, receiving better shelf placement, and receiving recognized awards compared to the prior period.At the 2012 Bodybuilding.com Supplement Awards, we received three Awards of Excellence; (i) the “Brand of the Year”award, (ii) the “Packaging of the Year” award, and (iii) the “Pre-Workout Supplement of the Year” awardfor Assault^TM, and MusclePharm remains the product of choice for the Ultimate Fighting Championship, UFC.

Discounts and sales allowances

Discounts and sales allowances for thethree months ended June 30, 2013 decreased to approximately $3,035,000 or 10.6% of gross sales as compared to $3,440,000 or 18.2%of gross sales for the three months ended June 30, 2012. This decrease in discounts and allowances is a result driven by continuedefforts to place controls around discounting and greater efforts to define customer terms and allowances.

Sales - net

Net sales increased approximately $10.1million or 65% to $25,480,000 for the three months ended June 30, 2013, compared to $15,429,000 for the three months ended June30, 2012. A significant growth area for the Company was nutritional product sales in international markets. International salesare included in the results of operations and increased approximately $3.5 million or 56% to $9,833,000 for the three months endedJune 30, 2013, compared to $6,302,000 for the three months ended June 30, 2012.

Gross Profit

Gross profit increased approximately $5.4million or 218% to $7,913,000 for the three months ended June 30, 2013, compared to $2,487,000 for the three months ended June30, 2012. The gross profit percentage increased to approximately 31% of net sales during the three months ended June 30, 2013,from 16% for the three months ended June 30, 2012. This increase was primarily due to the reduction in discounts as a percentageof sales, new product pricing from our Tennessee manufacturer, and the reduction of shipping costs. As discussed in Note 2 of thefinancial statements for shipping, the Company is handling its own shipping and has decreased the cost to ship product to the customerthereby increasing gross profit. Shipping expense for the three months ended June 30, 2013 was 2.6% of net sales down from 3.2%of net sales for the three months ended June 30, 2012.

For the three months ended June 30, 2013the discounts as a percentage of gross sales was 10.6% compared to the three months ended June 30, 2012 of 18.2%. We have alsoexperienced a decrease in cost of goods sold as a result of improved product pricing For the three months ended June 30, 2013 thecost of goods as a percentage to sales was 69% compared to the three months ended June 30, 2012 of 84%. We expect to focus on streamliningour operations and seek operating efficiencies in order to further improve our gross profit percentage.

General and Administrative Expenses

General and administrative (“G&A”)expenses for the three months ended June 30, 2013, increased to approximately $10,654,000, compared to approximately $4,151,000for the three months ended June 30, 2012 a 157% increase. Part of the reason for this increase in G&A is two consulting contractsof GRQ and Melechdavid. These contracts, categorized in the table below as professional fees, were entered into by the Companyto promote the growth and expansion necessary to expand and raise capital and repay the previous existing debt by which the Companywas encumbered. The total amount booked as expense for these advisory contracts in the second quarter of 2013 totaled approximately$3.0 million and these contracts were satisfied as explained in Note 7 Stockholder’s Equity. This expense represents 46%of the total increase in the general and administrative expenses. The Company’s obligations under the GRQ and Melechdavidagreements were completely satisfied as of July 12, 2013 and the agreements have not been renewed or extended.

The 65% increase in sales necessitatedincreases in our general and administrative expenses and included $1,231,000 in the area of advertising and promotions used topromote brand and product awareness. We expect as we continue to promote our brand and products, these areas and levels of promotionwill hold steady or increase relative to overall efforts to increase product awareness and sales.

Another area of increase is consultingexpenses of $567,000 related to consulting on a variety of matters including investor relations, product research and development,product certifications, capital acquisition, and debt retirement.

The $6.5 million increase in general andadministrative expenses including the significant items listed above were partially offset by the decrease of $182,000 in stockbased compensation.

The following table provides an overviewof expense categories and percentage of net revenue:

Loss from Operations

The net loss from operations for the threemonths ended June 30, 2013, was approximately $2,741,000, compared to a net loss of approximately $1,664,000 for the three monthsended June 30, 2012.

Other Income (Expenses)

Other income was $319,000 for the threemonths ended June 30, 2013, compared to the $7,846,000 for the three months ended June 30, 2012. Refer to Note 5 for further detailof costs related to derivative agreements.

Net (Loss) Income

For the foregoing reasons, we had a netloss of approximately $2,422,000 for the three months ended June 30, 2013, compared to net income of approximately $6,182,000 forthe three months ended June 30, 2012.

Inflation did not have a material impacton our operations for the period. Other than the foregoing, management knows of no trends, demands, or uncertainties that are reasonablylikely to have a material impact on our results of operations.

For the Six Months Ended June 30, 2013 and 2012 (unaudited):

Sales - gross

Gross sales increased approximately $15.3million or 40% to $53,440,000 for the six months ended June 30, 2013, compared to $38,172,000 for the six months ended June 30,2012. The increase in sales was due primarily to increased awareness of our product brand, combined with hiring additional salesand marketing staff, and adding new products in an effort to expand our customer base. Since inception, we have focused on an aggressivemarketing plan to penetrate the market. As such, significant promotional expenditures have been made to increase product salesthrough adding new customers and expanding our product line.

In this quarter the Company launched awomen’s line named FitMiss. The momentum is beginning to show increasing sales for this new product line. The Company believesit has a good position for market share with a women’s line of products. The Company is also considering other new products.Overall as a direct result of our aggressive marketing plan, our products are currently being offered in more retail stores, bothdomestically and internationally, receiving better shelf placement, and receiving recognized awards compared to the prior period.At the 2012 Bodybuilding.com Supplement Awards, we received three Awards of Excellence; (i) the “Brand of the Year”award, (ii) the “Packaging of the Year” award, and (iii) the “Pre-Workout Supplement of the Year” awardfor Assault^TM, and MusclePharm remains the product of choice for the Ultimate Fighting Championship, UFC.

Discounts and sales allowances

Discounts and sales allowances for thesix months ended June 30, 2013 decreased to approximately $5,398,000 or 10.1% of gross sales as compared to $6,182,000 or 16.2%of gross sales for the six months ended June 30, 2012. This decrease in discounts and allowances is a result driven by continuedefforts to place controls around discounting and greater efforts to define customer terms and allowances.

Sales - net

Net sales increased approximately $16.1million or 50% to $48,041,000 for the six months ended June 30, 2013, compared to $31,990,000 for the six months ended June 30,2012. A significant growth area for the Company was nutritional product sales in international markets. International sales areincluded in the results of operations and increased approximately $7.5 million or 84% to $16,456,000 for the six months ended June30, 2013, compared to $8,963,000 for the six months ended June 30, 2012.

Gross Profit

Gross profit increased approximately $9.9million or 161% to $16,078,000 for the six months ended June 30, 2013, compared to $6,152,000 for the six months ended June 30,2012. The gross profit percentage increased to approximately 33% of net sales during the six months ended June 30, 2013, from 19%for the six months ended June 30, 2012. This increase was primarily due to the reduction in discounts as a percentage of sales,new product pricing from our Tennessee manufacturer, and the reduction of shipping costs. As discussed in Note 2 of the financialstatements for shipping, the Company is handling its own shipping and has decreased the cost to ship product to the customer therebyincreasing gross profit. Shipping expense for the six months ended June 30, 2013 was 2.3% of net sales down from 3.3% of net salesfor the six months ended June 30, 2012.

For the six months ended June 30, 2013the discounts as a percentage of gross sales was 10.1% compared to the six months ended June 30, 2012 of 16.2%. We have also experienceda decrease in cost of goods sold as a result of improved product pricing For the six months ended June 30, 2013 the cost of goodsas a percentage to sales was 67% compared to the six months ended June 30, 2012 of 81%. We expect to focus on streamlining ouroperations and seek operating efficiencies in order to further improve our gross profit percentage.

General and Administrative Expenses

G&Aexpenses for the six months ended June 30, 2013, increased to approximately $19,541,000, compared to approximately $8,544,000 forthe six months ended June 30, 2012 a 129%, increase. A primary reason for this increase in G&A is two consulting contractsof GRQ and Melechdavid. These contracts, categorized in the table below as professional fees, were entered into by the Companyto promote the growth and expansion necessary to expand and raise capital and repay the previous existing debt by which the Companywas encumbered. The total amount booked as expense for these advisory contracts in the first half of 2013 totaled approximately$6,592,000 and these contracts were satisfied as explained in Note 7 Stockholder’s Equity. This expense represents 60% ofthe total increase in the general and administrative expenses. The Company’s obligations under the GRQ and Melechdavid agreementswere completely satisfied as of July 12, 2013 and the agreements have not been renewed or extended.

The 50% increase in sales necessitatedincreases in our general and administrative expenses and included $1,616,000 in the area of advertising and promotions used topromote brand and product awareness. We expect as we continue to promote our brand and products, these areas and levels of promotionwill hold steady or increase relative to overall efforts to increase product awareness and sales. This increase was partially offsetby a decrease in apparel and athlete endorsement/sponsorship of $307,000. Another area of increase is legal fees of $276,000 relatedto efforts required to obtain financing and dispute resolutions.

The $11 million increase in general andadministrative expenses including the significant items listed above were partially offset by the decrease of $342,000 in stockbased compensation.

The following table provides an overviewof expense categories and percentage of net revenue:

Loss from Operations

Our net loss from operations for the sixmonths ended June 30, 2013, was $3,462,000, compared to $2,392,000 for the six months ended June 30, 2012.

Other Income (Expenses)

Other expenses were $6,321,000 for thesix months ended June 30, 2013, compared to the $7,462,000 for the six months ended June 30, 2012. During the six months endedJune 30, 2013, the Company issued warrants to convert 1,500,000 shares of preferred stock into 3,000,000 shares of common stock.Refer to Note 5 for further detail of costs related to derivative agreements.

Net Loss

For the foregoing reasons, we had a netloss of approximately $9,784,000 for the six months ended June 30, 2013, compared to approximately $9,853,000 for the six monthsended June 30, 2012.

Inflation did not have a material impacton our operations for the period. Other than the foregoing, management knows of no trends, demands, or uncertainties that are reasonablylikely to have a material impact on our results of operations.

Liquidity and Capital Resources

The following table summarizes total currentassets, liabilities and working capital at June 30, 2013, compared to December 31, 2012.

Our primary source of operating cash hasbeen through the sale of equity and through the issuance of convertible secured promissory notes and other short-term debt as discussedbelow.

The Company’s management believescurrent levels of liquidity are sufficient for current operations, but additional capital may be needed to execute the businessplan, which includes buying more inventory. There can be no assurance that such capital will be available on acceptable terms orat all.

On March 27, 2013, MusclePharm sold anaggregate of 703,236 shares of its common stock, $0.001 par value per share at a per share price of $8.50 in a private placementto certain accredited investors for an aggregate purchase price of approximately $5,977,506, thereby providing working capital.

The common stock was sold pursuant to subscriptionagreements dated March 27, 2013 between the Company and the Purchasers. The Subscription Agreements contained customary terms regarding,among other things, representations and warranties and indemnification.

On May 6, 2013, MusclePharm sold an aggregateof 100,000 shares of its common stock, $0.001 par value per share at a per share price of $8.50 in a private placement to certainaccredited investors, thereby providing working capital.

The common stock was sold pursuant to subscriptionagreements dated May 6, 2013 between the Company and the Purchasers. The Subscription Agreements contained customary terms regarding,among other things, representations and warranties and indemnification.

On June 3, 2013, MusclePharm sold an aggregateof 150,000 shares of its common stock, $0.001 par value per share at a per share price of $10.00 in a private placement to certainaccredited investors, for an aggregate purchase price of approximately $1,398,139 thereby providing working capital.

The common stock was sold pursuant to subscriptionagreements dated June 3, 2013 between the Company and the Purchasers. The Subscription Agreements contained customary terms regarding,among other things, representations and warranties and indemnification.

At June 30, 2013, we had cash of $8,656,000and working capital of approximately $11,107,000 compared to cash of $0 and a working capital deficit of approximately $11,571,000at December 31, 2012. The working capital increase of approximately $22,678,000 was primarily due to a net increase in cash of$8,656,000, an increase in accounts receivable of $5,933,000 and a decrease in current liabilities of $5,879,000.

Cash used in operating activities was $5,164,810for the six months ended June 30, 2013, as compared to cash provided by operating activities of $438,007 for the six months endedJune 30, 2012. The increase in cash used in operating activities of approximately $5.6 million for the six months ended June 30,2013, compared to the six months ended June 30, 2012, was primarily due to an increase in accounts receivable and prepaid expenseof approximately $7.6 million, an increase in the amortization of prepaid stock compensation of $2.9 million, a decrease in customerdeposits of approximately $1.5 million, a decrease in depreciation and amortization expense of approximately $2.7 million, anda decrease on loss on settlement of approximately $3.3 million offset by a decrease in derivative expense and change in fair valueof derivatives of approximately $4.9 million, a decrease in inventory of approximately $0.3 million, a decrease in accounts payableand accrued liabilities of approximately $1.2 million and a decrease in net loss of approximately $70,000.

Cash used in investing activities decreasedto $353,566 from $579,859 for the six months ended June 30, 2013 and 2012, due to slightly lower spending on fixed assets. Futureinvestments in property and equipment, as well as further development of our Internet presence will largely depend on availablecapital resources.

Cash flows provided by financing activitieswere $14,168,061 for the six months ended June 30, 2013, compared to cash flows used in financing activities of $266,660 for thesix months ended June 30, 2012. The approximately $14.4 million increase was due to primarily to the net increase of approximately$18.4 million net proceeds from equity offerings, a decrease of approximately $0.4 million in the repurchase of common stock anda decrease of approximately $0.1 million in debt issue costs offset by a decrease of approximately $4.1 million in proceeds fromissuance of debt and an increase in debt repayment of approximately $0.3 million.

Off-Balance Sheet Arrangements

Other than the operating leases, as ofJune 30, 2013, we did not have any off-balance sheet arrangements. We are obligated under an operating lease for the rental ofoffice space. Future minimum rental commitments with a remaining term in excess of one year as of June 30, 2013 are as follows:

Years Ending December 31,

Critical Accounting Policies and Estimates

The preparation of financial statementsin conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilitiesand disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenuesand expenses during the reporting period.

Making estimates requires management toexercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation orset of circumstances that existed at the date of the financial statements, which management considered in formulating its estimatecould change in the near term due to one or more future non-conforming events. Accordingly, the actual results could differ significantlyfrom estimates.

 Accounts Receivableand Allowance for Doubtful Accounts

Accounts receivable represents trade obligationsfrom customers that are subject to normal trade collection terms. We periodically evaluate the collectability of our accounts receivableand considers the need to establish an allowance for doubtful accounts based upon historical collection experience and specificcustomer information. Accordingly, the actual amounts could vary from the recorded allowances.

We perform ongoing evaluations of our customers’financial condition and generally do not require collateral. Management reviews accounts receivable periodically and reduces thecarrying amount by a valuation allowance that reflects management’s best estimate of amounts that may not be collectible.Allowances, if any, for uncollectible accounts receivable are determined based upon information available and historical experience.

We do not charge interest on past due receivables.Receivables are determined to be past due based on the payment terms of the original invoices.

Fair Value of Financial Instruments

We measure assets and liabilities at fairvalue based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents theamount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transactionbetween market participants. As such, fair value may be based on assumptions that market participants would use in pricing an assetor liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair valueon either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level.

The following are the hierarchical levelsof inputs to measure fair value:

Revenue Recognition

We record revenue when all of the followinghave occurred: (1) persuasive evidence of an arrangement exists, (2) product has been shipped or delivered, (3) the sales priceto the customer is fixed or determinable, and (4) collectability is reasonably assured.

Depending on individual customer agreements,sales are recognized either upon shipment of products to customers or upon delivery. We record sales allowances and discounts asa direct reduction of sales.

We have determined that advertising relatedcredits that were granted to customers fell within the guidance of ASC No. 605-50-55 (“Revenue Recognition” –Customer Payments and Incentives – Implementation Guidance and Illustrations). The guidance indicates that, absent evidenceof benefit to the vendor, appropriate treatment requires netting these types of payments against revenues and not expensing asadvertising expense.

We have an informal seven day right toreturn products. There were nominal returns at the six month periods ended June 30, 2013 and 2012.

Foreign Currency

We began operations in Canada in April2012. The Canadian Dollar was determined to be the functional currency as the majority of the transactions related to the day today operations of the business are exchanged in Canadian Dollars. At the end of the period, the financial results of the Canadianoperation are translated into United States Dollars, which is the reporting currency, and added to the U.S. operations for consolidatedcompany financial results. The revenue and expense items are translated using the average rate for the period and the assets andliabilities at the end of period rate. Transactions that have completed the accounting cycle and resulted in a gain or loss relatedto translation are recorded in realized gain or loss due to foreign currency translation under other income expense on the incomestatement. Transactions that have not completed their accounting cycle but appear to have gain or loss due to the translation processare recorded as unrealized gain or loss due to translation and held in the equity section on the balance sheet until such datethe accounting cycle of a transaction is complete and the actual realized gain or loss is recognized.

Beneficial Conversion Feature

For conventional convertible debt wherethe rate of conversion is below market value, we record a “beneficial conversion feature” (“BCF”) and relateddebt discount.

When we record a BCF, the relative fairvalue of the BCF would be recorded as a debt discount against the face amount of the respective debt instrument. The discount wouldbe amortized to interest expense over the life of the debt.

Derivative Liabilities

Fair value accounting requires bifurcationof embedded derivative instruments such as conversion features in convertible debt or equity instruments, and measurement of theirfair value for accounting purposes. In determining the appropriate fair value, we use the Black-Scholes option-pricing model. Inassessing the convertible debt instruments, management determines if the convertible debt host instrument is conventional convertibledebt and further if there is a beneficial conversion feature requiring measurement. If the instrument is not considered conventionalconvertible debt, we will continue our evaluation process of these instruments as derivative financial instruments.

Once determined, derivative liabilitiesare adjusted to reflect fair value at each reporting period end, with any increase or decrease in the fair value being recordedin results of operations as an adjustment to fair value of derivatives. In addition, the fair value of freestanding derivativeinstruments such as warrants, are also valued using the Black-Scholes option-pricing model.

Debt Issue Costs and Debt Discount

We may pay debt issue costs, and recorddebt discounts in connection with raising funds through the issuance of convertible debt. These costs are amortized over the lifeof the debt to interest expense. If a conversion of the underlying debt occurs, a proportionate share of the unamortized amountsis immediately expensed.

Original Issue Discount

For certain convertible debt issued, weprovide the debt holder with an original issue discount. The original issue discount is recorded to debt discount and additionalpaid in capital at an amount not to exceed gross proceeds raised, reducing the face amount of the note and is amortized to interestexpense over the life of the debt.

Share-Based Payments

Generally, all forms of share-based payments,including stock option grants, warrants, restricted stock grants and stock appreciation rights are measured at their fair valueon the awards’ grant date, based on estimated number of awards that are ultimately expected to vest. Share-based compensationawards issued to non- employees for services rendered are recorded at either the fair value of the services rendered or the fairvalue of the share-based payment, whichever is more readily determinable.

BUSINESS

General

MusclePharm Corporation, a Nevada corporation(“MusclePharm”, the “Company”, “we”, “us”, or “our”) was incorporatedin the state of Nevada on August 4, 2006, under the name “Tone in Twenty” for the purpose of engaging in the businessof providing personal fitness training using isometric techniques. On February 18, 2010, Tone in Twenty acquired all of the issuedand outstanding equity and voting interests of Muscle Pharm, LLC, a Colorado limited liability company, in exchange for 30,589shares of its common stock. As a result of this transaction, Muscle Pharm, LLC became a wholly owned subsidiary of Tone in Twenty,and Tone in Twenty changed its name to “MusclePharm Corporation.” Our principal executive offices are located at 4721Ironton Street, Building A, Denver, Colorado 80239 and our telephone number is (303) 396-6100.

We develop, market and sell athlete-focused,high quality nutritional supplements primarily to specialty resellers. Our products have been formulated to enhance active fitnessregimens, including muscle building, weight loss and maintaining general fitness. Our nutritional supplements are available forpurchase in over 10,500 U.S. retail outlets, including Dick’s Sporting Goods, GNC, Vitamin Shoppe and Vitamin World. We alsosell our products to over 100 online channels, including bodybuilding.com, amazon.com, gnc.com and vitacost.com. Internationally,our nutritional supplements are sold in approximately 90 countries, and we expect that international sales will be a significantportion of our sales for the foreseeable future.

We started formulating our nutritionalsupplements in 2008 for consumption by active individuals, high performance athletes and fitness enthusiasts. We launched our salesand marketing programs in late 2008 through our internal sales executives and staff targeting specialty retail distributors.

We supply our nutritional supplements toelite athletes on teams in the National Football League, Major League Baseball and the National Basketball Association, as wellas Ultimate Fighting Championship fighters. While these endorsers and professional sports teams use our products, no endorsementby any of them as to the merits of our securities should be inferred.

Our products were created through our six-stageprocess using the expertise of distinguished nutritional scientists we have retained and they are typically field tested usinga pool of several elite athletes on various teams in the National Football League, Major League Baseball and National BasketballAssociation, as well as Ultimate Fighting Championship fighters. We do not directly manufacturer or ship our products to most ofour customers. Rather, we outsource our manufacturing to non-affiliated third parties who fulfill our orders and ship productsdirectly to our customers.

We have recently experienced significantgrowth in our product sales. Our net sales for the years ended December 31, 2012 and 2011 were $67.1 million and $17.2 million,respectively. Our net sales for the quarter ended June 30, 2013 and 2012, were $25,480,000 and $15,429,000, respectfully and forthe six months ended June 30, 2013 and 2012, were $48,041,000 and $31,990,000, respectfully. Additionally, during the second quarterof 2012, we commenced operations in Ontario, Canada, through our subsidiary Canada MusclePharm Enterprises Corp.

At the 2012 Bodybuilding.com SupplementAwards, we received three Awards of Excellence; we received (i) the “Brand of the Year” award, (ii) the “Packagingof the Year” award, and (iii) the “Pre-Workout Supplement of the Year” award for Assault ^TM .

Our headquarters in Denver, Colorado hasa state-of-the-art over 30,300 square feet athletic facility with a medical and clinical testing department, complete with equipmentfor measuring and conducting athletic clinical studies and supporting athletes. Our medical and clinical professionals consistof several nationally recognized medical doctors and nutritional experts who oversee our product research, formulation, efficacyanalysis and testing.

Recent Developments

Reverse Stock Split and Increase in Number of AuthorizedShares of Common Stock

On November 26, 2012, we (i) effected a1-for-850 reverse stock split of our common stock, including a proportionate reduction in the number of authorized shares of ourcommon stock from 2.36 billion shares to 2.8 million shares of common stock, and (ii) amended our articles of incorporation toincrease the number of authorized shares of common stock (post reverse stock split) from 2,941,177 to 100 million effective November27, 2012. All share and per share amounts in this document have been changed to give effect to the reverse stock split.

Conversion of Warrants into Common Stock

In late September 2012, we issued 512,675shares of our common stock to several accredited investors pursuant to conversions of warrants to purchase an aggregate of 723,747shares of our common stock. As a result of these warrant conversions and other extinguishments of derivative liabilities duringthe quarter ended September 30, 2012, our stockholders’ deficit decreased from $11,013,113 at June 30, 2012 to $7,297,593at September 30, 2012 and our derivative liabilities decreased from $7,908,960 at June 30, 2012 to $24,889 at September 30, 2012.On December 5, 2012, we converted a warrant exercisable for 4,902 shares of common stock into 3,677 shares of our common stock.Thereafter, our derivative liability was reduced to approximately $300 as of December 5, 2012.

Registered Direct Offerings

On February 4, 2013, we completed the finalclosing of our registered direct offering of an aggregate of 1,500,000 shares of our Series D Convertible Preferred Stock, at apublic offering price of $8.00 per share pursuant to an offering registered with the SEC. Each share of Series D Convertible PreferredStock is convertible into two shares of common stock, subject to adjustment. Our net proceeds from the offering were approximately$10.8 million after placement agent discounts, and other offering expenses of $1.2 million. Net proceeds from this offering wereused to reduce indebtedness and for other corporate purposes.

As of August 19, 2013, 1,355,000 SeriesD shares have been converted into 2,710,000 shares of the Company’s common stock and 145,000 shares of Series D preferredstock remain outstanding.

Private Placements of Common Stock

On March 26, 2013, the Company entered intosubscription agreements with non-affiliated accredited investors for the issuance of 703,236 shares of common stock pursuant toexemptions from registration under federal and state securities laws. The shares of common stock were sold for $8.50 per share.The gross proceeds to the Company of $6.0 million were reduced by commissions and issuance costs of $115,000.

In May, 2013, the Company entered into a subscription agreementwith one non-affiliated investor for the issuance of 100,000 shares of common stock pursuant to exemptions from registration underfederal and state securities laws. The shares of common stock were sold for $8.50 per share.

On June 3, 2013, the Company entered intoa subscription agreement with one non-affiliated accreditor investor for the issuance of 150,000 shares of common stock pursuantto exemptions from registration under federal and state securities laws. The shares of common stock were sold for $10.00 per share.The gross proceeds of $1,500,000 were reduced by commissions and issuance costs of $75,000.

On August 8, 2013, the Company enteredinto a subscription agreement with six non-affiliated accredited investors for the issuance of 238,096 shares of common stock pursuantto exemptions from federal and state securities laws. The shares of common stock were sold for $10.50 per share.

Co-Branding Agreement

On July 26, 2013, the Company entered intoan Endorsement Licensing and Co-Branding Agreement by and among Marine MP, LLC, and Fitness Publications, Inc. (Marine MP, LLCand Fitness Publications, Inc. together, the “AS Parties”). Under the terms of the Agreement, a special Arnold Schwarzeneggerproduct line of between 4 and 8 products will be marketed under Mr. Schwarzenegger’s name and likeness.

Pursuant to the Agreement, Mr. Schwarzeneggergranted the Company a license to use, subject to Mr. Schwarzenegger’s approval, worldwide, Mr. Schwarzenegger’s nameand Appearance Rights (as defined in the Co-Branding Agreement), oral and written endorsements, and approved videos, images, appearance,likeness, voice recording, signature and professional background to advertise the Company’s products. Additionally, Mr. Schwarzeneggerhas agreed to make certain appearance on behalf of the Company throughout the term of the Agreement.

Pursuant to theAgreement, as compensation and in consideration of the license granted by Mr. Schwarzenegger and the services he shallprovide, Marine MP, LLC shall receive (i) royalty payments based upon a percentage of net sales of licensed productsthroughout the term of the Agreement, subject to certain minimum amounts, and (ii) 780,000 shares of the Company’srestricted common stock (the “Stock Compensation”). The Company agreed to file this “resale”registration statement with the SEC covering all Stock Compensation issued pursuant to the Agreement by August 21, 2013.

Our Growth Strategy

Our primary growth strategy is to:

Our Core Marketing Strategy

Our core marketing strategy is to brandMusclePharm as the “must have” fitness brand for workout enthusiasts and elite athletes. We seek to be known as TheAthletes 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 anoptimal strategy to increase sales.

Sponsorships and Promotions

Since 2011, we have been the official supplementprovider and sponsor of the Ultimate Fighting Championship, or UFC. Our sponsorship includes prominent logo placement on the fightingmat, and our branding can be seen on FOX Television Stations, FX Networks, FUEL TV and Pay-Per-View television worldwide. The UFCfighters we sponsor feature our brand on their uniforms and we also extensively advertise at the UFC events.

We are also currently engaged in variousin-store promotions, including point-of-purchase stands, aisle displays in retail outlets, as well as sample demonstrations inDick’s Sporting Goods, GNC, Vitamin World and Vitamin Shoppe.

In 2011, we launched an advanced websitein seeking to tap into the social networking world and to further our brand and consumer awareness. The information in our websiteis not part of this prospectus. We have included our website address as a factual reference and do not intend it to be an activelink to our website. Also, we currently have over 617,000 fans combined between our company and executive officer Facebook andTwitter accounts.

Industry Overview

We operate within the large and growingU.S. nutritional supplements industry. According to Nutrition Business Journal’s 2012 Supplement Business Report, our industrygenerated over $30 billion in sales in 2011 and $28.1 billion in 2010, and is projected to grow at an average annual rate of approximately6.0% through 2020.

According to Nutrition Business Journal,sports nutrition products represented approximately 12% of the total sales in the U.S. nutritional supplements industry in 2011,and the category is expected to grow at a 9.1% compound annual growth rate (or CAGR) from 2012 to 2020, representing the fastestgrowing product category in the nutritional supplements industry.

We believe there are several key demographic,healthcare and lifestyle trends driving the continued growth of our industry. These trends include:

Participants in our industry include specialtyretailers, supermarkets, drugstores, mass merchants, multi-level marketing organizations, online retailers, mail-order companiesand a variety of other small participants. The nutritional supplements sold through these channels are divided into four majorproduct categories: vitamins, minerals and health supplements; sports nutrition products; diet products; and other wellness products.Most supermarkets, drugstores and mass merchants have narrow nutrition supplement product offerings limited primarily to simplevitamins and herbs, with less knowledgeable sales associates than specialty retailers.

Our Products

We currently offer 28 athlete-focused,high quality nutritional supplement products. None of our products are formulated to contain substances that have been the subjectof publicized health concerns by the medical community such as ephedra, androstene, androstenedione, aspartame, steroids or humangrowth hormones. Our products are comprised of vitamins, minerals, herbs and herbal extracts, carbohydrates, proteins and aminoacids tested by our recognized scientists, and intended to be safe and effective for the overall health of athletes. Moreover,our nutritional supplements are intended to enhance the effects of workouts, support muscle recovery and strength, and nourishthe human body for optimal physical fitness. The following is a brief description of our current products:

MusclePharm Apparel

We granted an exclusive indefinite licenseto market, manufacture, design and sell our existing apparel line. The licensee paid an initial fee of $250,000 in June, 2011 andwill pay us a 10% net royalty based on the licensee’s net income at the end of each fiscal year. As of March 31, 2013, wehad not earned any royalty revenue under this licensing arrangement.

Quality in Our Products

In seeking quality in our products, we require that before aproduct is brought to market, all:

Future Products

New products are derived from a numberof sources, including our management, trade publications, scientific and health journals, consultants and distributors. Prior tointroducing new products, we investigate product formulations as they relate to regulatory compliance and other issues.

Research and Development

Each of our products is the end resultof a six stage process involving recognized nutrition scientists, doctors and professional athletes. Our expenses for researchand development for the years ended December 31, 2012 and 2011, were approximately $0.2 million and $0.1 million, respectivelyand for the quarter ended June 30, 2013 and 2012, were approximately $0.1 million and $0.1 million, respectively.

Management Information, Internet andTelecommunication Systems

The ability to efficiently manage distribution,compensation, inventory control, and communication functions through the use of sophisticated and dependable information processingsystems is critical to our success.

We continue to invest in applications andintegrations to improve and optimize business processes and to increase performance company wide.

Product Returns

We provide an informal seven day rightof return for our products. Historically, product returns as a percentage of our net sales have been nominal.

Trademarks and Patents

We regard our trademarks and other proprietaryrights as valuable assets and believe that protecting our key trademarks is crucial to our business strategy of building strongbrand name recognition. These trademarks are crucial elements of our business, and have significant value in the marketing of ourproducts.

Our policy is to pursue registrations forall of the trademarks associated with our products. Federally registered trademarks have a perpetual life, provided that they aremaintained and renewed on a timely basis and used correctly as trademarks, subject to the rights of third parties to attempt tocancel a trademark if priority is claimed or there is confusion of usage. We rely on common law trademark rights to protect ourunregistered trademarks. Common law trademark rights generally are limited to the geographic area in which the trademark is actuallyused, while a United States federal registration of a trademark enables the registrant to stop the unauthorized use of the trademarkby any third party anywhere in the United States. Furthermore, the protection available, if any, in foreign jurisdictions may notbe as extensive as the protection available to us in the United States.

Although we seek to ensure that we do notinfringe on the intellectual property rights of others, there can be no assurance that third parties will not assert intellectualproperty infringement claims against us.

We have obtained U.S. registration on trademarksfor eight of our products with USPTO applications pending on several of our newest products. We have abandoned or not pursued effortsto register marks identifying other items in our product line for various reasons including the inability of some names to qualifyfor registration. We also received federal trademark registration for 14 names or expressions that we use or intend to use to distinguishourselves from others, with several USPTO applications pending. All trademark registrations are protected for an initial periodof five years and then are renewable after five years if still in use and every 10 years thereafter.

We have filed for a provisional patentto protect technology used in certain of our products, including MusclePharm Musclegel® and Re-Con®. The patent was filedin the United States as a Patent Cooperation Treaty application to secure patent protection worldwide. An International SearchReport Written Opinion was issued in October 2012, and was published at the International Bureau on February 28, 2013.

We also have filed for protection of variousmarks throughout the world and are committed to a significant long-term strategy to build and protect the MusclePharm brand globally.The “MusclePharm” mark is pending registration in 14 countries. The mark has been granted final trademark registrationin six countries, and we believe the remaining registrations will be granted within the next several months.

The “MP” logo has been filedand registration granted in one country. The application for protection of the logo is expected to be filed in the near futurein 26 additional countries. Going forward, we expect to seek trademark registration for our best-selling international products.

Competition

We compete with many companies engagedin selling nutritional supplements. The sports nutrition business is highly competitive. Most of our competitors have significantlymore financial and human resources than we do, and have operating histories longer than ours. We seek to differentiate our productsand marketing from our competitors based on our product quality, the use of sports celebrity endorsers and through our marketingprogram. Competition is based primarily on quality and assortment of products, marketing support, and availability of new products.Currently, our main competitors are three private companies: Optimum Nutrition, Inc., or Optimum, Iovate Health Sciences, Inc.,or IHS, and Bio-Engineered Supplements and Nutrition, Inc., or BSN. Optimum is a wholly owned subsidiary of Glanbia Nutritionals,Inc., an international nutritional ingredients group. Optimum owns and operates two brands of nutritional supplements (OptimumNutrition and American Body Building), providing a line of products across multiple categories. IHS is a nutritional supplementcompany that delivers a range of products to the nutritional marketplace. Headquartered in Oakville, Ontario, Canada, IHS’sline of products can be found in major retail stores and include such brands as Hydroxy-Cut™, Cell-Tech™, Six StarNutrition™. BSN is also a sports nutrition leader whose top products include No-Explode™ and Syntha Six Protein™.

The retail market for nutritional supplementsis characterized by a few dominant national companies, including GNC, Vitamin World, Vitamin Shoppe, and Great Earth Vitamin Stores.Others have a presence within local markets, such as Vitamin Cottage in Denver, Colorado. Four companies dominate the online channel—bodybuilding.com,vitamins.com (owned by Puritan’s Pride), GNC.com and vitaminshoppe.com, the latter two having retail sales locations as well.

Major competitors in the sports nutritionand weight-loss markets consist of companies such as EAS, Inc., Weider Nutrition International, Inc. and Twinlab Corporation, whichdominate the market with such products as Myoplex (EAS), Body Shaper (Weider) and Ripped Fuel (Twinlab).

We also compete with a number of largedirect selling firms selling nutritional, diet, health, personal care and environmental products, and numerous small competitors.The principal direct selling competitors are Amway Corporation, Nature’s Bounty, Inc., Sunrider Corporation, New Vision USA,Inc., Herbalife International of America, Inc., USANA, Inc., and Melaleuca, Inc.

We intend to compete by aggressively marketingour brand, emphasizing our relationships with professional athletes, and maximizing our relationships with those athletes, retailoutlets and industry publications that align with our vision.

Our Manufacturers

We are committed to producing and sellinghighly efficacious products that are trusted for their quality and safety. To date, our products have been outsourced to a thirdparty manufacturer where the products are manufactured in full compliance with the current good manufacturing practice, or cGMP,standards set by the U.S. Food and Drug Administration, or FDA.

We use four non-affiliated principal manufacturersfor the components of our products, and multiple vendors for packaging and labeling. We have an agreement in place with our primarymanufacturer. This agreement was designed to support our growth and ensure consistence in production and quality. Our primary manufacturerpurchases all needed raw materials from suppliers. Additionally, our primary manufacturer is responsible for acquisition and storageof all product inventory (at both on and off-site facilities). We do not take title to our products until time of shipment to retailers.The three non-primary manufacturers are governed by purchase order terms and can be terminated at any time.

Our relationship with any of our manufacturesmay be terminated upon proper notice. We have established relationships with other manufacturers that we believe can satisfy ourneeds if our relationship with any manufacturer terminates.

Product Delivery

All of our products shipped out of theUnited States are shipped by our manufacturers directly to our retailers. Our manufacturers collect sales tax on products basedupon the address of the consumer to whom products are sent regardless of how the order is placed. Products sold by MuscleCharmCanada are shipped from our inventory held in Canada. We collect sales tax on products when applicable.

Regulatory Matters

Government Regulation and Statutes –Product Regulation

Domestic

The manufacture, packaging, labeling, advertising,promotion, distribution and sale of our products are subject to regulation by one or more federal agencies, including the FDA,Consumer Product Safety Commission, or CPSC, and the U.S. Department of Agriculture, or USDA. Advertising and other forms of promotionand methods of marketing are subject to regulation primarily by the U.S. Federal Trade Commission, or FTC, which regulates theseactivities under the Federal Trade Commission Act, or FTCA. The foregoing matters regarding our products are also regulated byvarious state and local agencies as well as those of each foreign country to which we distribute our products.

The Dietary Supplement Health and EducationAct of 1994, or DSHEA, amended the Federal Food, Drug, and Cosmetic Act, or FFDC Act, to establish a new framework governing thecomposition, safety, labeling, manufacturing and marketing of dietary supplements. All of the products we market are regulatedas dietary supplements under the FFDC Act.

Generally, under the FFDC Act, dietaryingredients that were marketed in the United States prior to October 15, 1994 may be used in dietary supplements without notifyingthe FDA. “New” dietary ingredients (i.e., dietary ingredients that were “not marketed in the United States beforeOctober 15, 1994”) must be the subject of a new dietary ingredient notification submitted to the FDA unless the ingredienthas been “present in the food supply as an article used for food” without being “chemically altered”. Anew dietary ingredient notification must provide the FDA with evidence of a “history of use or other evidence of safety”establishing that use of the dietary ingredient “will reasonably be expected to be safe”. A new dietary ingredientnotification must be submitted to the FDA at least 75 days before it is initially marketed. The FDA may determine that a new dietaryingredient notification does not provide an adequate basis to conclude that the ingredient is reasonably expected to be safe. Sucha determination could prevent the marketing of the dietary ingredient. The FDA recently issued draft guidance governing the notificationfor new dietary ingredients. Although FDA guidance is not mandatory, and companies are free to use an alternative approach if theapproach satisfies the requirements of applicable laws and regulations, FDA guidance is a strong indication of the FDA’s“current thinking” on the topic discussed in the guidance, including its position on enforcement. At this time, itis difficult to determine whether the draft guidance, if finalized, would have a material impact on our operations. However, ifthe FDA were to enforce the applicable statutes and regulations in accordance with the draft guidance as written, this manner ofenforcement could require us to incur additional expenses, which could be significant, and negatively impact our business in severalways, including, but not limited to, enjoining the manufacturing of our products until the FDA determines that we are in complianceand can resume manufacturing, which could increase our liability and reduce our growth prospects.

The Dietary Supplement Labeling Act of2011, which was introduced in July 2011 (S1310), would amend the FFDC Act to, among other things, (i) require dietary supplementmanufacturers to register the dietary supplements that they manufacture with the FDA (and provide a list of the ingredients inand copies of the labels and labeling of the supplements), (ii) mandate the FDA and the Institute of Medicine (a non-governmental,nonprofit organization that provides advice to the public and decision makers, such as the FDA, concerning health issues) to identifydietary ingredients that cause potentially serious adverse effects, (iii) require warning statements for dietary supplements containingpotentially unsafe ingredients and (iv) require that the FDA define the term “conventional food”. If the bill is reintroducedand enacted, it could restrict the number of dietary supplements available for sale, increase our costs, liabilities and potentialpenalties associated with manufacturing and selling dietary supplements, and reduce our growth prospects.

The Dietary Supplement Safety Act (S3002)was introduced in February 2010 and would repeal the provision of DSHEA that permits the sale of all dietary ingredients sold indietary supplements marketed in the United States prior to October 15, 1994, and instead permit the sale of only those dietaryingredients included on a list of Accepted Dietary Ingredients to be issued and maintained by the FDA. The bill also would allowthe FDA to: impose a fine of twice the gross profits earned by a distributor on sales of any dietary supplement found to violatethe law; require a distributor to submit a yearly report on all non-serious adverse event reports received during the year to theFDA; and allow the FDA to recall any dietary supplement it determines with “a reasonable probability” would cause seriousadverse health consequences or is adulterated or misbranded. The bill also would require any dietary supplement distributor toregister with the FDA and submit a list of the ingredients in and copies of the labels of its dietary supplements to the FDA andthereafter update such disclosures yearly and submit any new dietary supplement product labels to the FDA before marketing anydietary supplement product. If this bill is reintroduced and enacted, it could severely restrict the number of dietary supplementsavailable for sale and increase our costs and potential penalties associated with selling dietary supplements.

The FDA or other agencies could take actionsagainst products or product ingredients that in its determination present an unreasonable health risk to consumers that would makeit illegal for us to sell such products. In addition, the FDA could issue consumer warnings with respect to the products or ingredientsin such products at the point they are sold to end users. Such actions or warnings could be based on information received throughFFDC Act-mandated reporting of serious adverse events. The FDA in recent years has applied these procedures to require that consumersbe warned to stop using certain dietary supplements. For businesses that have been subjected to these regulatory actions, saleshave been reduced and the businesses have been required to pay refunds for recalled products.

In general, we seek representations andwarranties, indemnification and/or insurance from our vendors. However, even with adequate insurance and indemnification, any claimsof non-compliance could significantly damage our reputation and consumer confidence in our products. In addition, the failure ofsuch products to comply with applicable regulatory and legislative requirements could prevent us from marketing the products orrequire us to recall or remove such products from the market, which in certain cases could materially and adversely affect ourbusiness, financial condition and results of operations.

Under the current provisions of the FFDCAct, there are four categories of claims that pertain to the regulation of dietary supplements. First are health claims that describethe relationship between a nutrient or dietary ingredient and a disease or health related condition and can be made on the labelingof dietary supplements if supported by significant scientific agreement and authorized by the FDA in advance via notice and commentrulemaking. Second are nutrient content claims which describe the nutritional value of the product and may be made if defined bythe FDA through notice and comment rulemaking and if one serving of the product meets the definition. Third are statements of nutritionalsupport or product performance. The FFDC Act permits “statements of nutritional support” to be included in labelingfor dietary supplements without FDA pre-market approval. These statements must be submitted to the FDA within 30 days of marketingand may describe how a particular dietary ingredient affects the structure, function or general well-being of the body, or themechanism of action by which a dietary ingredient may affect body structure, function or well-being, but may not expressly or implicitlyrepresent that a dietary supplement will diagnose, cure, mitigate, treat or prevent a disease. A company that uses a statementof nutritional support in labeling must possess scientific evidence substantiating that the statement is truthful and not misleading.The fourth category are drug claims, representations that a product is intended to diagnose, mitigate, treat, cure or prevent adisease, are prohibited from use in the labeling of dietary supplements, and we make no drug claims regarding our products.

We may make claims for our dietary supplementproducts regarding three of the four categories, that are statements of nutritional support, health claims and nutrient contentclaims when authorized by the FDA, or that otherwise are allowed by law. The FDA’s interpretation of what constitutes anacceptable statement of nutritional support may change in the future, thereby requiring that we revise our labeling. These regulatoryactivities include those discussed above concerning products marketed before October 15, 1994 or afterwards, and the requirementsof 75 days advance notice to the FDA before marketing products containing new dietary ingredients. There is no assurance that theFDA will accept the evidence of safety for any new dietary ingredients that we may wish to market, and the FDA’s refusalto accept that evidence could prevent the marketing of the new dietary ingredients and dietary supplements containing a new dietaryingredient. If the FDA determines that a particular statement of nutritional support is an unacceptable drug claim, conventionalfood claim or an unauthorized version of a “health claim”, or, if the FDA determines that a particular claim is notadequately supported by existing scientific data or is false or misleading, we would be prevented from using the claim.

In addition, DSHEA provides that so-called“third-party literature”, e.g., a reprint of a peer-reviewed scientific publication linking a particular dietary ingredientwith health benefits, may be used “in connection with the sale of a dietary supplement to consumers” without the literaturebeing subject to regulation as labeling. The literature: (1) must not be false or misleading; (2) may not “promote”a particular manufacturer or brand of dietary supplement; (3) must present a balanced view of the available scientific informationon the subject matter; (4) if displayed in an establishment, must be physically separate from the dietary supplements; and (5)should not have appended to it any information by sticker or any other method. If the literature fails to satisfy each of theserequirements, we may be prevented from disseminating such literature with our products, and any dissemination could subject ourproduct to regulatory action as an illegal drug.

Our dietary supplements must also complywith the Dietary Supplement and Nonprescription Drug Consumer Protection Act, which became effective on December 22, 2007. Thislaw amends the FFDC Act to mandate that we report to the FDA any reports of serious adverse events that we receive. Under the law,an “adverse event” is any health-related event associated with the use of a dietary supplement that is adverse, anda “serious adverse event” is any adverse event that results in death, a life-threatening experience, inpatient hospitalization,a persistent or significant disability or incapacity, or a congenital anomaly or birth defect, or requires, based on reasonablemedical judgment, a medical or surgical intervention to prevent one of these outcomes. Serious adverse event reports received throughthe address or phone number on the label of a dietary supplement, as well as all follow-up reports of new medical information receivedwithin one year after the initial report, must be submitted to the FDA no later than 15 business days after the report is received.The law also requires recordkeeping for reports of non-serious adverse events as well as serious adverse events for six years followingthe event, and these records are subject to FDA inspection.

In June 2007, pursuant to the authoritygranted by the FFDC Act as amended by DSHEA, the FDA published detailed current good manufacturing practice, or cGMP, regulationsthat govern the manufacturing, packaging, labeling and holding operations of dietary supplement manufacturers. The cGMP regulations,among other things, impose significant recordkeeping requirements on manufacturers. The cGMP requirements are in effect for allmanufacturers, and the FDA is conducting inspections of dietary supplement manufacturers pursuant to these requirements. Thereremains considerable uncertainty with respect to the FDA’s interpretation of the regulations and their actual implementationin manufacturing facilities. The failure of a manufacturing facility to comply with the cGMP regulations renders products manufacturedin such facility “adulterated”, and subjects such products and the manufacturer to a variety of potential FDA enforcementactions.

The FDA has also announced its intentionto promulgate new cGMPs specific to dietary supplements, to fully enforce DSHEA and monitor compliance with the Bioterrorism Actof 2002. We intend to comply with the new cGMPs once they are adopted. The new cGMPs, predicted to be finalized shortly, wouldbe more detailed and stringent than the cGMPs that currently apply to dietary supplements and may, among other things, requiredietary supplements to be prepared, packaged, produced and held in compliance with regulations similar to the cGMP regulationsfor drugs. There can be no assurance that, if the FDA adopts cGMP regulations for dietary supplements, we will be able to complywith the new regulations without incurring a substantial expense.

In addition, under the Food Safety ModernizationAct, or FSMA, which was enacted on January 4, 2011, the manufacturing of dietary ingredients contained in dietary supplements willbe subject to similar or even more burdensome manufacturing requirements, which will likely increase the costs of dietary ingredientsand will subject suppliers of such ingredients to more rigorous inspections and enforcement. The FSMA will also require importersof food, including dietary supplements and dietary ingredients, to conduct verification activities to ensure that the food theymight import meets applicable domestic requirements.

The FDA has broad authority to enforcethe provisions of federal law applicable to dietary supplements, including powers to issue a public warning or notice of violationletter to a company, publicize information about illegal products, detain products intended for import, require the reporting ofserious adverse events, require a recall of illegal or unsafe products from the market, and request the Department of Justice toinitiate a seizure action, an injunction action or a criminal prosecution in the U.S. courts. The FSMA expands the reach and regulatorypowers of the FDA with respect to the production and importation of food, including dietary supplements. The expanded reach andregulatory powers include the FDA’s ability to order mandatory recalls, administratively detain domestic products, requirecertification of compliance with domestic requirements for imported foods associated with safety issues and administratively revokemanufacturing facility registrations, effectively enjoining manufacturing of dietary ingredients and dietary supplements withoutjudicial process. The regulation of dietary supplements may increase or become more restrictive in the future.

Our failure to comply with applicable FDAregulatory requirements could result in, among other things, injunctions, product withdrawals, recalls, product seizures, finesand criminal prosecutions.

Our advertising of dietary supplement productsis subject to regulation by the FTC under the FTCA. Section 5 of the FTCA empowers the FTC to prohibit unfair methods of competitionand unfair or deceptive acts or practices in or affecting commerce. Section 12 of the FTCA provides that the dissemination of anyfalse advertisement for the purpose of inducing, directly or indirectly, the purchase of drugs or foods, which would include dietarysupplements, is an unfair or deceptive act or practice. Additionally, under the FTC’s Substantiation Doctrine, an advertiseris required to have a “reasonable basis” for all objective product claims before the claims are made. Failure to adequatelysubstantiate claims may also be considered an unfair or deceptive practice. Pursuant to this FTC requirement, we are required tohave adequate substantiation for all material advertising claims made for our products.

On November 18, 1998, the FTC issued “DietarySupplements: An Advertising Guide for Industry.” This guide provides marketers of dietary supplements with guidelines forapplying FTC law to dietary supplement advertising and reiterates and explains the FTC’s “reasonable basis” determination.It includes examples of the principles that should be used when interpreting and substantiating dietary supplement advertising.Although the guide provides additional explanation, it does not substantively change the FTC’s existing policy that all supplementmarketers have an obligation to ensure that claims are presented truthfully and to verify that such claims are adequately substantiated.

The FTC has a variety of processes andremedies available to it for enforcement, both administratively and judicially, including compulsory process, cease and desistorders and injunctions. FTC enforcement can result in orders requiring, among other things, limits on advertising, corrective advertising,consumer redress, divestiture of assets, rescission of contracts and such other relief as may be deemed necessary. Any violationcould have a material adverse effect on our business, financial condition and results of operations.

As a result of our efforts to comply withapplicable statutes and regulations in the United States and elsewhere, we have from time to time reformulated, eliminated or relabeledcertain of our products and revised certain advertising claims. We cannot predict the nature of any future laws, regulations, interpretationsor applications, nor can we determine what effect additional governmental regulations or administrative orders, when and if promulgated,would have on our business in the future. They could, however, require the reformulation of certain products to meet new standards,the recall or discontinuance of certain products not capable of reformulation, additional record keeping, expanded documentationof the properties of certain products, expanded or different labeling, and/or scientific substantiation. Any or all of such requirementscould have a material adverse effect on our business, financial condition and results of operations.

Advertising and labeling for dietary supplementsand conventional foods are also regulated by state, county and other local governmental authorities. Some states also permit theselaws to be enforced by private attorney generals. These private attorney generals may seek relief for consumers, seek class actioncertifications, seek class-wide damages, seek class-wide refunds and product recalls of products sold by us. There can be no assurancethat state and local authorities will not commence regulatory action, which could restrict the permissible scope of our productadvertising claims, or products that can be sold in the future.

Foreign

Our products which we sell or may makeplans to sell in foreign countries are also subject to regulation under various national, local and international laws that includeprovisions governing, among other things, the formulation, manufacturing, packaging, labeling, advertising and distribution ofdietary supplements and over-the-counter drugs. These regulations may prevent or delay entry into the market or prevent or delaythe introduction, or require the reformulation, of certain of our products. Compliance with such foreign governmental regulationsis generally the responsibility of our distributors for those countries. These distributors are independent contractors over whomwe have limited control.

Possible New Legislation or Regulation

Legislation may be introduced which, ifpassed, would impose substantial new regulatory requirements on dietary supplements. For example, although not yet reintroducedin this session of Congress, bills have been repeatedly proposed in past sessions of Congress which would subject the dietary ingredientdehydroepiandrosterone, or DHEA, to the requirements of the Controlled Substances Act, which would prevent the sale of productscontaining DHEA. In March 2009, the General Accounting Office, or GAO, issued a report that made four recommendations to enhancethe FDA’s oversight of dietary supplements. The GAO recommended that the Secretary of the Department of Health and HumanServices direct the Commissioner of the FDA to: (1) request authority to require dietary supplement companies to identify themselvesas a dietary supplement company and update this information annually, provide a list of all dietary supplement products they selland a copy of the labels and update this information annually, and report all adverse events related to dietary supplements, notjust serious adverse events; (2) issue guidance to clarify when an ingredient is considered a new dietary ingredient, the evidenceneeded to document the safety of new dietary ingredients, and appropriate methods for establishing ingredient identity; (3) provideguidance to industry to clarify when products should be marketed as either dietary supplements or conventional foods formulatedwith added dietary ingredients; and (4) coordinate with stakeholder groups involved in consumer outreach to identify additionalmechanisms for educating consumers about the safety, efficacy, and labeling of dietary supplements, implement these mechanisms,and assess their effectiveness. These recommendations could lead to increased regulation by the FDA or future legislation concerningdietary supplements.

We cannot determine what effect additionaldomestic or international governmental legislation, regulations, or administrative orders, when and if promulgated, would haveon our business in the future. New legislation or regulations may require the reformulation of certain products to meet new standards,require the recall or discontinuance of certain products not capable of reformulation, impose additional record keeping or requireexpanded documentation of the properties of certain products, expanded or different labeling or scientific substantiation.

Employees

We believe that our success will dependsignificantly on our ability to identify, attract, and retain capable employees. As of August 19, 2013, we had 47 full time employees.Our employees are not represented by any collective bargaining unit, and we believe our relations with our employees are good.We have recently completed staffing for the in-house medical and physiology center on-site in our training facilities.

Insurance

We maintain commercial liability, including product liabilitycoverage, and property insurance. Our policy provides for a general liability of $1.0 million per occurrence, and $2.0 millionannual aggregate coverage which includes our main corporate facility. We carry property coverage on our main office facility tocover our legal liability, tenant’s improvements, business property, and inventory. We maintain product liability insurancewith an aggregate cap on retained loss of $5.0 million

Properties

Our corporate headquarters is located in Denver, Colorado. Thiscommercial office building is 30,302 square feet and includes, a full performance training center, medical laboratory and a 96-seattheatre room. The term of the lease is 65 months, expiring on December 31, 2015. We currently pay approximately $13,500 in leasepayments per month.

We lease an office and distribution warehouse in Boise, Idaho.The office is 4,776 square feet with a term of two years, expiring October 31, 2014. We currently pay approximately $4,400 permonth for this lease. The warehouse is an adjoining property but a separate lease. The warehouse is 9,600 square feet the leaseexpires December 31, 2014, and the monthly lease payment is $3,360.

We lease a 64,000 square foot warehouse facility in Franklin,Tennessee. The term of the lease is through August 31, 2015. We currently pay approximately $9,450 per month for rent.

Through our Ontario, Canada subsidiary, Canada MusclePharm EnterprisesCorp., we lease a 10,000 square foot office and warehouse facility in Hamilton, Ontario, Canada. The term of the lease expiresin April of 2014. We currently pay 6,655 in Canadian dollars (or the U.S. dollar equivalent of about $6,544) per month for rent.

Legal Proceedings

Except as set forth below, we are currentlynot involved in any new litigation that we believe could have a material adverse effect on our financial condition or results ofoperations. Except as set forth below, there is no action, suit, proceeding, inquiry or investigation before or by any court, publicboard, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our Companyor any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companiesor our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a materialadverse effect.

From time to time, the Company is or may become involved invarious legal proceedings that arise in the ordinary course of business or otherwise. Legal proceedings are subject to inherentuncertainties as to timing, outcomes, costs, expenses and time expenditures by the Company’s management and others on behalfof the Company. Although there can be no assurance, based on information currently available the Company’s management believesthat the outcome of legal proceedings that are pending or threatened against the Company will not have a material effect on theCompany’s financial condition. However, the outcome of any of these matters is neither probable nor reasonably estimable.

The Company was party to the followinglegal matters as of December 31, 2011:

As of December 31, 2012, the Company isa party defendant in the following legal proceeding, which the Company: (a) believes is without merit; and (b) intends to defendvigorously:

As of December 31, 2012, the Company is a party plaintiff inthe following legal matter:

As of August 21, 2013, the Company is a party defendant in thefollowing legal proceeding, which the Company: (a) believes is without merit; and (b) intends to defend vigorously:

MANAGEMENT

Directors and Executive Officers ofthe Registrant

The following table sets forth certaininformation as of August 19, 2013, regarding our directors and named executive officers:

Brad J. Pyatt has served as ourChief Executive Officer and Director since February 18, 2010 and as our President since October 2012. Prior to our acquisitionof Muscle Pharm, LLC, Mr. Pyatt was President and Chief Executive Officer of Muscle Pharm, LLC, since its inception in April 2008.His background includes seven years of experience as a professional athlete, and more than five years of experience in the sportsnutrition arena. Mr. Pyatt played in National Football League for the Indianapolis Colts during the 2003, 2004, and 2005 NFL seasonsas well for the Miami Dolphins during the 2006 NFL season. Mr. Pyatt played in the Arena Football League for the Colorado Crushduring the 2007 and 2008 AFL seasons. Mr. Pyatt attended the University of Kentucky from 1999 to 2002, where he studied kinesiologyexercise science, as well as the University of Northern Colorado, from 2002 to 2003. Mr. Pyatt filed for protection under Chapter7 of the federal bankruptcy laws in 2008. He received a discharge relating to the matter in 2009.

L. Gary Davis has served as ourChief Financial Officer since July 2012. From January, 2010 prior to joining us, Mr. Davis worked as a certified public accountantfor various clients, specializing in mergers and acquisitions, and has extensive experience in finance with public traded companies.From November, 2004 to January, 2010, Mr. Davis served as Executive Vice President and Chief Financial Officer of Bodybuilding.com,a sports, fitness and nutritional supplement on-line retail store. He previously was Vice President and Chief Financial Officerof U.S. Ecology Corporation, and was previously a director of finance of Fortune 500 Company, Morrison-Knudsen and Vice-Presidentof Finance within Micron Technology. Mr. Davis has a Bachelor’s Degree in Accounting from Boise State University and workedtowards a Master’s Degree in Finance from Rochester Institute of Technology. He is a licensed certified public accountantin multiple states.

John H. Bluher has served as ourExecutive Vice President since September 2011 and as Co-Chairman of our board of directors since July 2012. From February 2011to August 2012, he served on the board of directors of Targeted Medical Pharma, Inc. From August 2010 to September 2011, he wasmanaging director of AFH Holdings & Advisory LLC, a business consulting company. From December 2009 to August 2010, Mr. Bluherassisted in raising capital, marketing and co-managed Coachman Energy Funds at Caddis Capital, LLC, a private equity portfoliofocused on oil and gas investments. From February 2010 to August 2010, Mr. Bluher acted as investment banker and special financialadvisor to the AARP Mutual Fund Board of Trustees in a platform divestiture. From December 2007 to May 2009, Mr. Bluher servedas managing director and general counsel at Lehman Brothers, Inc.’s investment management division. Mr. Bluher also servedas global chief legal and compliance officer and managing director of Neuberger Berman during this period. From August 2004 toJune 2007, Mr. Bluher served as general counsel and director of risk and Janus Capital, Inc. From June 2002 to July 2004, Mr. Bluherserved as executive vice president, general counsel and corporate secretary and director of risk management of Knight Trading Group.From January 2001 to May 2002, Mr. Bluher served as senior vice president and global chief compliance officer for Prudential Securities,Inc. From October 1997 to January 2001, Mr. Bluher served as general counsel and chief compliance officer of Sun America, Inc.,later AIG. From 1992 through 1997, Mr. Bluher served as Senior Vice President, Regional and Divisional Counsel at Prudential Securities,Inc. From 1987 to 1992, Mr. Bluher was senior counsel for the Division of Enforcement at the Securities and Exchange Commission.Mr. Bluher holds a Bachelor of Science and a J.D. degree from the University of Wyoming and holds FINRA Series 7, Series 24 andSeries 14 licenses. He has served on the boards of ICI Mutual Insurance Company, the NASDAQ Chairman’s Advisory Board, CherryHills Founders Group, Inc., Safe Communications, Inc., and the University of Wyoming Foundation Board, and College of Law AdvisoryBoard.

Richard Estalella joined the Companyas Chief Operating Officer in April 2013 and as a director in August 2013. Mr. Estalella served as Senior Vice President of Operationsat Arbonne International, LLC since 2005. Mr. Estalella was instrumental in Arbonne’s expansion operations and distributionupgrades and was responsible for all warehouse and distribution facilities, facilities maintenance departments and Customer Service.Previously, between 1998 and 2005, he owned a consulting business specializing in retail, operations, warehousing and distribution.Prior to that, Mr. Estalella served as Senior Vice President of Warehouse Operations for Office Depot between 1987 and 1998 andestablished many of its retail markets, along with its nationwide distribution center network also helped grow it into a $9 billioncompany.

Cory J. Gregory has served as anexecutive officer of Muscle Pharm, LLC, since its inception in 2008 and our Senior Vice President (formerly Senior President) sinceMay 2010. Prior to joining us, Mr. Gregory served as President, managing member, and owner of T3 Personal Training LLC, or T3,from April 2009 until November 2011. T3 was a personal training service that managed and oversaw over 40 clients using seven trainersover a ten-year period. During the same period, Mr. Gregory served as President of the Ohio Natural Bodybuilding Federation, afederation founded by Mr. Gregory in 2004 which hosted 14 bodybuilding competitions over a six-year period. He consulted for AgileEnterprises, a nutritional supplement company from January 2006 through January 2008. In 2004, Mr. Gregory purchased the Old SchoolGym, located in Pataskala, Ohio, which he continues to own at present day.

Daniel McCloryhas served as a director since August 6, 2013. He has been a member of Hunter Wise Financial Group, LLC since 2003, currently servingas its Managing Director. During his time at Hunter Wise Financial Group, LLC, Mr. McClory has completed public offerings, financingsand M&A deals for clients listed on the London Stock Exchange, NASDAQ, NYSE Amex, the Toronto Stock Exchange, and the Over-the-CounterMarkets. He has opened Hunter Wise Financial Group, LLC offices in London and Beijing in support of the firm’s investmentbanking clients in both locations. Mr. McClory earned his BS in English and an MA in Language and International Trade from EasternMichigan University.

Michael J. Doron has served as adirector since November 5, 2012. He has been the Managing Director of DDR & Associates, LLC since January 2009, and EvolutionCapital Partners, LLC since October 2009. From January 2007 to December 2008, he served as Chief Operating Officer and directorof Toyshare, Inc. From February 2006 to January 2007, Mr. Doron served as Chief Operating Officer and Chief Financial Officer ofFrontgate Sundance Alliance. From September 2005 to January 2007, he served as Vice President – Private Banking of the Bankof the West. Mr. Doron earned a BA from the University of Maryland and a Masters of Science from American University.

James J. Greenwell has served asa director since October 15, 2012. Since 2000, he has been the Chief Executive Officer of Datria Systems Inc., a speech recognitionapplication software company. He has also served as the Datria Systems’ Chairman since 2002. In prior employment, he servedas a technology executive in a number of private and public companies .He has served on the Board of the Cherry Creek School Foundationsince September 2010. He was a founding member of Friends of Denver Fire and served on its Board from 2007 through 2010. Mr. Greenwellserved on the Board of the Denver Chapter of the American Heart Association from 2002 through 2008 and was Chairman of the boardin 2007. He also served on the Board of Trustees of the Bonfils Blood Center Foundation from 1999 through 2003. Mr. Greenwell earneda BS from the College of Business at Michigan State University and an MBA degree from Saint Mary’s College.

Donald W. Prosser has served asa director on our board of directors since July 2012 and has been the principal executive officer of Arête Industries, Inc.since January 2011 and a director of Arête since September, 2003. Arête is a voluntary filer with the SEC under theSecurities Exchange Act of 1934. Mr. Prosser owns a certified public accounting firm, Donald W. Prosser, P.C., specializing intax services and accounting and has represented a number of private and public companies serving in the capacity of accountant,member of boards of directors, and as chief financial officer. From 1997 to 1999, Mr. Prosser served as Chief Financial Officerand Director for Chartwell International, Inc., a public company publishing high school athletic information and providing athleticrecruiting services. From 1999 to 2000, he served as Chief Financial Officer and Director for Anything Internet, Inc. and from2000 to 2001, served as Chief Financial Officer and Director for its successor, Inform Worldwide Holdings, Inc., a publicly tradedcompany. From November 2002 through June 2008, Mr. Prosser served as CFO of VCG Holding Corp., a public company. From July 2008through August 2009 Mr. Prosser was Chief Financial Officer of Iptimize, Inc., a provider of broadband and data services that fileda petition under federal bankruptcy laws in October 2009. He also has served on the board of directors of Veracity Management Global,Inc., a publicly traded company, since January, 2008. Mr. Prosser has been a certified public accountant since 1975. Mr. Prosserattended the University of Colorado from 1970 to 1971 and Western State College of Colorado from 1972 to 1975, where he earneda Bachelor’s Degree in Accounting and History (1973) and a Master’s Degree in Accounting – Income Taxation (1975).

Advisory Board

We have established an Advisory Board currentlyconsisting of nine members, which serves to advise management with respect to product formulations, product ideas, marketing andrelated matters. Members of the Advisory Board do not meet on a formal or regular basis. Our management team consults with oneor more members of the Advisory Board as needed, from time to time, by means of meetings or telephone conference calls.

Following is a brief description of thebackground of our advisory board members:

Dr. Eric Serrano –Chief Formulator Medical Advisor. Dr. Serrano has been practicing medicine in the State of Ohio for over 22 years and isconsidered one of the leading sports nutrition doctors in the country. His clients include a wide array of athletes from the NFL,NHL, and MLB, in addition to many elite amateur athletes. Dr. Serrano was a professor of family practice medicine at Ohio StateUniversity, where he was awarded Professor of The Year and Preceptor of The Year. Dr. Serrano currently lectures across the countryto universities, medical groups and health and fitness conferences on the topics of sports nutrition, performance enhancement,and injury prevention. He has formulated numerous nutritional supplements for some of the leading nutritional companies on themarket and also been a contributing writer for some of the leading U.S. health and fitness magazines, including Muscle &Fitness . Dr. Serrano has been involved in the formulations for each of our products. Dr. Serrano received his B.A. from KansasState University in Biology, his M.A. from Kansas State University in Exercise Physiology, and his M.D. from the University ofKansas Medical School.

Dr. Mauro Di Pasquale –Director of Product Development and Research. Dr. Di Pasquale brings five decades of personal, clinical and university teachingand learning, combined with leadership gained from medical directorships of important sports organizations to us. Dr. Di Pasqualehas written over a dozen books on athletic performance, focusing mainly on diet and supplementation, most notably his books, TheAnabolic Diet and The Metabolic Diet . He has received an Honors M.D., Honors B.Sc. (majoring in genetics and molecularbiochemistry), both from the University of Toronto. He has also published 1,000 articles in magazines such as Muscle & Fitness, Flex and Powerlifting USA .

Dr. Roscoe M. Moore, Jr.– Chief Scientific Director. A Former U.S. Assistant Surgeon General, Dr. Moore served with the United States Departmentof Health and Human Services (HHS) and was for the last 12 years of his career there the principal person responsible for globaldevelopment support within the Office of the Secretary, HHS, with primary emphasis on Continental Africa and other less developedcountries of the world. He was the principal liaison person between the HHS and Ministries of Health in Africa with regard to thedevelopment of infrastructure and technical support for the delivery of preventive and curative health needs for the continent.Dr. Moore received his undergraduate and Doctor of Veterinary Medicine degrees from Tuskegee Institute; his Master of Public Healthdegree in Epidemiology from the University of Michigan; and his Doctor of Philosophy degree in Epidemiology from the Johns HopkinsUniversity. He was awarded the Doctor of Science degree (Honoris Causa) in recognition of his distinguished public health careerby Tuskegee University. Dr. Moore was a career officer within the Commissioned Corps of the United States Public Health Service(USPHS) entering with the U.S. National Institutes of Health and rising to the rank of Assistant United States Surgeon General(Rear Admiral, USPHS) within the Immediate Office of the Secretary, HHS. He was selected as Chief Veterinary Medical Officer, USPHS,by Surgeon General C. Everett Koop.

Dr. Phillip Frost –Member of MusclePharm Scientific Advisory Board. Dr. Frost has served as the CEO and Chairman of OPKO Health, Inc. since onMarch 27, 2007. Dr. Frost was named the Chairman of the Board of Teva Pharmaceutical Industries, Limited, or Teva, (NYSE:TEVA)in March 2010 and had previously been Vice Chairman since January 2006 when Teva acquired IVAX Corporation, or IVAX. Dr. Frosthad served as Chairman of the Board of Directors and Chief Executive Officer of IVAX Corporation since 1987. He was Chairman ofthe Department of Dermatology at Mt. Sinai Medical Center of Greater Miami, Miami Beach, Florida from 1972 to 1986. Dr. Frost wasChairman of the Board of Directors of Key Pharmaceuticals, Inc. from 1972 until the acquisition of Key Pharmaceuticals by ScheringPlough Corporation in 1986. Dr. Frost was named Chairman of the Board of Ladenburg Thalmann Financial Services Inc. (NYSE Amex:LTS),an investment banking, asset management, and securities brokerage firm providing services through its principal operating subsidiary,Ladenburg Thalmann & Co. Inc., in July 2006 and has been a director of Ladenburg Thalmann from 2001 until 2002 and again since2004. Dr. Frost also serves as Chairman of the board of directors of PROLOR Biotech, Inc. (NYSE Amex: PBTH), a development stagebiopharmaceutical company. He serves as a member of the Board of Trustees of the University of Miami and as a Trustee of each ofthe Scripps Research Institute, the Miami Jewish Home for the Aged, and the Mount Sinai Medical Center. Dr. Frost is also a directorof Castle Brands (NYSE Amex:ROX), a developer and marketer of premium brand spirits. Dr. Frost previously served as a directorfor Continucare Corporation, Northrop Grumman Corp., Ideation Acquisition Corp., Protalix Bio Therapeutics, Inc., and SafeStitchMedical Inc., and as Governor and Co-Vice-Chairman of the American Stock Exchange (now NYSE Amex).

Dr. Frost has successfully founded severalpharmaceutical companies and overseen the development and commercialization of a multitude of pharmaceutical products. This combinedwith his experience as a physician and chairman and/or chief executive officer of large pharmaceutical companies has given himinsight into virtually every facet of the pharmaceutical business and drug development and commercialization process. He is a demonstratedleader with keen business understanding and is uniquely positioned to help guide our Company through its transition from a developmentstage company into a successful, multinational biopharmaceutical and diagnostics company.

Dr. Richard Ogden (CSCS) –Medical Advisor. Dr. Odgen’s career in clinical research and development spans nearly 40 years. After earning a Ph.D.from Cambridge University, his career started with postdoctoral research studying ribonucleic acid transcription and processing.Following that, he undertook independent research, funded by the National Science Foundation. In 1984, he joined Agouron Pharmaceuticals,Inc. as one of its founding scientists. Following Agouron’s merger with Pfizer, he served as a Senior Director and was thescientific liaison for the Agouron/Pfizer commercial and corporate organizations. In 2006, Dr. Ogden, co-founded RORR Inc., a medical,scientific consulting and education company with clients in the U.S. and Europe. In addition to publication in numerous medicaljournals, he is co-editor of two books relating to AIDS therapy.

Dr. Michael R. Stevens –Director of Therapeutic Nutrition. Dr. Stevens has over 20 years of well-diversified experience in the healthcare and pharmaceuticalindustry. Dr. Stevens spent 17 years at Bristol-Myers Squibb, where he held positions of increasing responsibility in the areasof Market Research (Oncology and HIV), Marketing (Oncology), and Medical Affairs (HIV). In addition served as a member of the ExecutiveCouncil for the Forum for Collaborative HIV Research — a public-private partnership facilitating discussion on emerging issuesin HIV clinical research and working to translate research results into patient care. He has also served on 15 Protocol Committeeswithin the Adult AIDS Clinical Trials Group (ACTG). Michael received his B.S. Pharmacy and Doctor of Pharmacy degrees from PurdueUniversity.

Dr. Ron Sekura – Directorof Therapeutic Research. Dr. Sekura is the former Chief of the Pharmaceutical and Regulatory Affairs Branch of the Divisionof AIDS at The National Institute of Allergy and Infectious Diseases (NIAID) of the National Institute of Health (NIH) as wellas a former Research Chemist at The National Institutes of Child Health and Human Development (NICHD) at the NIH and the Centerfor Biologics Evaluation and Research (CBER). He received his Bachelor of Science and Master of Science in Biochemistry degreesat Pennsylvania State University and his PhD at Cornell University. Dr. Sekura is the author of over 60 scientific publications.

Mariel Selbovitz –Director of Global Therapeutics Product Procurement Development. Ms. Selbovitz is a graduate of Cornell University and receivedher Master’s in Public Health at the Johns Hopkins University Bloomberg School of Health. She worked as the Client IntakeSpecialist at Positive Health Project and Syringe Exchange Program Coordinator at the Foundation for Research on Sexually TransmittedDiseases and is a partner in BioEquity Partners. Selbovitz is a member of the Cornell AIDS Clinical Trials Group Community AdvisoryBoard and AIDS Treatment Advocacy Coalition.

James Sapirstein, R.Ph., MBA– Strategic Advisor. Mr. Sapirstein has been the Chief Executive Officer of Alliqua Inc. since October 2012. He was thePresident and Chief Executive Officer of Tobira Therapeutics, Inc., or Tobira, from August 2007 through April 2011 and foundedTobira in October 2006. Prior to Tobira, Mr. Sapirstein worked at Paramount BioCapital from May 2005 to September 2006 in the companycreation group. Mr. Sapirstein was the Executive Vice President of the Metabolic and Endocrinology Business Unit from 2002 throughApril 2005. Mr. Sapirstein was the Director of Global Marketing at Gilead Sciences from July 2000 through May 2002, where he wasresponsible for the global launch of Viread ^® . He was the head of the international infectious disease marketingteams during his time at Bristol-Myers Squibb from August 1996 to July 2000. Mr. Sapirstein was with Hoffmann-LaRoche from October1987 to July 1996, where he worked in a variety of capacities ranging from marketing and sales positions to international posts.Prior to working at Hoffmann LaRoche, he worked at Eli Lilly and Company in a sales capacity from June 1984 to October 1987. Mr.Sapirstein earned his Bachelor of Science in Pharmacy from the Ernest Mario School of Pharmacy at Rutgers University and an MBAfrom Farleigh Dickinson University.

Michael Kim, D.O. – Executive Director of Medicine,Research and Education. Dr. Kim has been our Executive Director of Medicine, Research and Education since August 2011. He overseesour research. He analyzes formulations, research protocols and strength and performance protocols. He also advises our athleteendorsers regarding nutrient, diet and supplementation. He received a B.A. in Economics from University of California – Davis,and a Doctor of Osteopathy degree from Touro University.

Corporate Governance

Director Independence

Each director and named executive officeris obligated to disclose, on an annual basis, any transactions with our Company and any of its subsidiaries in which a directoror executive officer, or any member of his or her immediate family, have a direct or indirect material interest. Following completionof these disclosures, our board of directors make a determination as to the independence of each director using the current standardsfor “independence” that satisfy both the criteria for the NASDAQ Stock Market and the NYSE MKT.

As of November 5, 2012, our board of directorsconducted an annual review and affirmatively determined that Messrs. Doron, Greenwell and Prosser are “independent”as that term is defined in the NASDAQ listing standards.

Committees of the Board

During 2012, our board of directors heldnine meetings. Each director attended at least 75% of the meetings (held during the period that such director served) of the Boardand the committees on which such director served in 2012.

In addition, the board acts from time totime by unanimous written consent in lieu of holding a meeting. During 2012, the board effected several actions by unanimous writtenconsent. Members of our board are encouraged to attend our annual meeting of shareholders.

The following table sets forth the threestanding committees of our board and the members of each committee and the number of meetings held by our board and the committeesduring 2012:

To assist it in carrying out its duties,the board has delegated certain authority to an Audit Committee, a Compensation Committee and a Nominating and Corporate GovernanceCommittee as the functions of each are described below.

Committee

Messrs. Doron, Greenwell and Prosser serveon our Audit Committee. Our Audit Committee’s main function is to oversee our accounting and financial reporting processes,internal systems of control, independent auditor relationships and the audits of our financial statements. The Audit Committee’sresponsibilities include:

The board of directors has adopted an AuditCommittee Charter. The Audit Committee members meet NASDAQ’s financial literacy requirements, and the board has further determinedthat Mr. Prosser (i) is an “audit committee financial expert” as such term is defined in Item 407(d)of Regulation S-K promulgated by the SEC and (ii) also meets NASDAQ’s financial sophistication requirements.

Compensation Committee

Messrs. Doron, Greenwell and Prosser serveon the Compensation Committee. Our Compensation Committee’s main functions are assisting our board of directors in dischargingits responsibilities relating to the compensation of outside directors, the Chief Executive Officer and other executive officers,as well as administering any stock incentive plans we may adopt. The Compensation Committee’s responsibilities include thefollowing:

The board of directors has adopted a CompensationCommittee Charter.

The Compensation Committee’s policyis to offer our executive officers competitive compensation packages that will permit us to attract and retain highly qualifiedindividuals and to motivate and reward these individuals in an appropriate fashion aligned with the long-term interests of ourCompany and our stockholders.

Compensation Committee Risk Assessment.We have assessed our compensation programs and concluded that our compensation practices do not create risks that are reasonablylikely to have a material adverse effect on us.

Nominating and Corporate GovernanceCommittee

Messrs. Doron, Greenwell and Prosser serveon our Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee’s responsibilitiesinclude:

The board of directors has adopted a Nominating and CorporateGovernance Committee Charter.

Corporate Governance Materials

The full text of the charters of our Audit,Nominating and Corporate Governance, and Compensation Committees and our Business Conduct and Code of Ethics can be found at www.musclepharm.com.Copies of these documents also may be obtained from our Corporate Secretary.

Board of Directors Diversity

The board does not have a formal diversitypolicy. The board considers candidates that will make the board as a whole reflective of a range of talents, skills, diversityand expertise.

Code of Ethics

Our board of directors has adopted a Codeof Ethics (“Code of Ethics”), which provides general statements of our expectations regarding ethical standards thatwe expect our directors, officers and employees to adhere to while acting on our behalf. Among other things, the Code of Ethicsprovides that:

Our Code of Ethics also contains proceduresfor employees to report, anonymously or otherwise, violations of the Code of Ethics.

Section 16(a) Beneficial OwnershipReporting Compliance

Section 16(a) of the Exchange Act, requiresthe Company’s directors and named executive officers, and persons who beneficially own more than ten percent of our commonstock, to file initial reports of ownership and reports of changes in ownership of our common stock and our other equity securitieswith the SEC. As a practical matter, the Company assists its directors and officers by monitoring transactions and completing andfiling Section 16 reports on their behalf. Based solely on a review of the copies of such forms in our possession and on writtenrepresentations from reporting persons, we believe that during 2012 all of our named executive officers and directors filed therequired reports on a timely basis under Section 16(a) of the Exchange Act, except that one Form 3 was filed for Mr. Burr on November9, 2012 with respect to becoming a director on July 19, 2012; one Form 4 was filed for Mr. Burr on November 9, 2012 with respectto transactions occurring on September 17, 2012 one Form 4 was filed for Mr. Bluher on November 20, 2012 with respect to transactionsoccurring on August 15, 2012; and one Form 4 was filed for Mr. Bluher on November 20, 2012 with respect to transactions occurringon September 26, 2012.

EXECUTIVE COMPENSATION

Summary Compensation Table for 2012

The following summary compensation tablessets forth all compensation awarded to, earned by, or paid to each person serving as a named executive officer of the Company duringthe year ended December 31, 2012.

Outstanding Equity Awards at Year End

The following table provides informationconcerning the holdings of stock option and restricted stock unit awards by our named executive officers as of December 31, 2012.This table includes unexercised (both vested and unvested) stock option awards and unvested restricted stock unit awards with vestingconditions that were not satisfied as of December 31, 2012. Each equity grant is shown separately for each named executive officer.The vesting schedule for each outstanding equity award is shown in the footnotes following this table.

Employment Arrangements

On October 18, 2012, and amended on January4, 2013 to reduce the base salary of each executive officer at the request of such executive officer, the Company entered intoamended and restated employment agreements (except for Mr. Davis, which was an initial employment agreement) with the followingexecutive officers of the Company, which include its principal executive officer, principal financial officer and other named executiveofficers:

The employment agreements were executedbased upon a form employment agreement approved by the Compensation Committee of the board. The employment agreements are for aninitial term ending December 31, 2014. However, the employment agreements entered into with Mr. Pyatt and Mr. DeLuca provide foran initial term ending December 31, 2015.

Under the terms of the employment agreements,each officer will receive an annual base salary in the amount set forth below, subject to any increase the Compensation Committeemay deem appropriate from time to time.

In addition, the officers will be eligibleto receive one or more annual cash bonuses and grants of stock options, restricted stock or other equity-related awards from theCompany’s various equity compensation plans, as determined by the Compensation Committee.

If the employment of an officer is terminateddue to the officer’s death or inability to perform, the employment agreements provide for payment to the officer of any unpaidportion of the Officer’s base salary and benefits accrued through the date of death or inability to perform and, at the discretionof the Compensation Committee, a bonus. The officer or his representatives will also be entitled to receive a reimbursement ofup to 12 months of Consolidated Omnibus Reconciliation Act, or COBRA, premiums, if the officer or his representatives timely electand remain eligible for COBRA. If the officer’s employment is terminated due to inability to perform, the officer will alsobe entitled to (i) a lump sum payment equal to the greater of (A) the target bonus payable to the Officer for the year inwhich the date of termination occurs or if no target bonus has been set, the officer’s most recent annual bonus, and (B)a bonus for such year as may be determined by the Compensation Committee in its sole discretion; and (ii) a severance payment (payableover six months) equal to six months of the officer’s base salary in effect as of the date of termination.

If the officer’s employment is terminatedfor “cause” or if an Officer terminates his employment without “good reason” (as such terms are definedin the employment agreement), the officer will not be entitled to a severance payment or any other termination benefits. However,the Company will pay the officer any unpaid portion of the officer’s base salary and benefits accrued through the date ofsuch termination.

Upon a termination of an officer’semployment (except for Mr. Pyatt) by the Company without cause and without a change in control or by the officer for good reasonwithout a change in control, the employment agreements provide that such officer will be entitled to (i) any unpaid portion ofthe officer’s base salary and benefits accrued through the date of termination; (ii) an amount payable over three monthsand equal to the lesser of (A) nine months of the officer’s base salary in effect as of the date of termination, or (B) theofficer’s base salary remaining under the term of his employment agreement; (iii) a lump sum payment equal to 25% of theofficer’s target bonus (or if no target bonus has been set, the Officer’s most recent annual bonus) if the terminationis between January 1 and June 30 or 50% of the Officer’s target bonus (or if no target bonus has been set, the Officer’smost recent annual bonus) if the termination is between July 1 and December 31; (iv) acceleration of the officer’s outstandingequity awards, unless otherwise provided in the equity award agreement for a particular equity award; and (v) the officer willalso be entitled to receive a reimbursement of up to 12 months of COBRA premiums, if the officer timely elects and remains eligiblefor COBRA.

Upon a termination of Mr. Pyatt’semployment by the Company without cause and without a change in control or by Mr. Pyatt for good reason without a change in control,Mr. Pyatt’s employment agreement provides that he will be entitled to (i) any unpaid portion of his base salary and benefitsaccrued through the date of termination; (ii) an amount payable over three months and equal to two times his base salary on thedate of termination; (iii) a lump sum payment equal to the greater of (A) two times his target bonus for the for the year in whichthe date of termination occurs or if no target bonus has been set, then two times Mr. Pyatt’s most recent annual bonus, and(B) a bonus for such year as may be determined by the Compensation Committee in its sole discretion; (iv) acceleration ofhis outstanding equity awards, unless otherwise provided in the equity award agreement for a particular equity award; and (v) hewill also be entitled to receive a reimbursement of up to 12 months of COBRA premiums, if he timely elects and remains eligiblefor COBRA.

Upon a termination of an officer’semployment (except for Mr. Pyatt) by the Company without cause and with a change in control or by the officer for good reason aftera change in control, the employment agreement provides that such officer will be entitled to (i) any unpaid portion of the officer’sbase salary and benefits accrued through the date of termination; (ii) a severance payment (payable over 12 months) equal to 12months of the officer’s base salary in effect as of the date of termination; (iii) a lump sum payment equal to the greaterof (A) 100% of the officer’s target bonus in the year of termination or if no target bonus has been set, then 100% of theofficer’s most recent annual bonus, and (B) a bonus for such year as may be determined by the Committee in its sole discretion;(iv) a severance payment of $500,000 (payable within 30 days of the date of termination); (v) acceleration of the officer’soutstanding equity awards; and (vi) the officer will also be entitled to receive a reimbursement of up to 12 months of COBRA premiums,if the officer timely elects and remains eligible for COBRA.

Upon a termination of Mr. Pyatt’semployment by the Company without cause and with a change in control or by Mr. Pyatt for good reason after a change in control,Mr. Pyatt’s employment agreement provides that he will be entitled to (i) any unpaid portion of his base salary and benefitsaccrued through the date of termination; (ii) a severance payment (payable over 12 months) equal to three times his base salaryin effect as of the date of termination; (iii) a severance payment of $2 million (payable within 30 days of the date of termination);(v) acceleration of Mr. Pyatt’s outstanding equity awards; and (vi) he will also be entitled to receive a reimbursement ofup to 12 months of COBRA premiums, if he timely elects and remains eligible for COBRA.

The employment agreements also containcustomary confidentiality, non-competition and non-solicitation provisions. Under the non-compete provisions, during the term ofhis employment agreement and for a period of six months after termination of employment, the officer is prohibited from, directlyor indirectly, engaging in or becoming interested financially in, as a principal, employee, partner, contractor, shareholder, agent,manager, owner, advisor, lender, guarantor, officer or director, any business that is engaged in the nutritional supplement industryand/or related products, subject to certain exceptions for passive investments.

Additionally, the non-solicitation provisionsof the employment agreements prohibit the officer from soliciting for employment any employee of the Company or any person whowas an employee of the Company in the 90-day period before such solicitation. This prohibition applies during the officer’semployment with the Company and for 12 months following the termination of the officer’s employment.

Change in Control Payments

The Employment Agreements referenced in the above provide forpayments upon termination or employment after a change in control in certain situations.

Director Compensation

Director Compensation for 2012

The following table sets forth the aggregatecompensation paid to our non-employee directors during 2012.

2012 Non-Employee Director Compensation Program

In October 2012, our board of directorsadopted a non-employee director compensation program. Directors who are employees of the Company receive no additional compensationfor their services as directors. Non-employee directors are compensated for their service on our board of directors as describedbelow. The following table describes the components of compensation for non-employee directors in effect beginning October 2012:

Annual Cash Retainer and MeetingFees . Beginning in October 2012, each non-employee director who continues to serve as a director will receive an annualcash retainer fee of $20,000 per year, pro rata for service less than one year. Non-employee directors will also receive $1,000per meeting attended for all in-person and telephonic meetings of the Board subject to a $6,000 per-year cap on meeting fees. Further,the Audit Committee Chair will receive $1,000 per Audit Committee meeting.

Annual Equity Retainer Award.Beginning in January 2013 and pro-rata for the fourth quarter of 2012, each non-employee director will receive $25,000 of the annualboard retainer fee in the form of restricted common stock with the number of shares of restricted common stock determined by dividingthat dollar amount by the closing price of our common stock on the date of grant. These shares of restricted common stock willvest in four equal quarterly installments. The restricted common stock awards will be forfeitable during that vesting period, thoughdirectors who leave the board during the year will receive any vested restricted common stock. On February 14, 2013, we grantedeach non-employee director a restricted stock award for 6,252 restricted shares of common stock that vests as to 1,563 shares ona quarterly basis beginning March 31, 2013.

New Director Fee (one-time equitygrant). Beginning in October 2012, each non-employee director will receive a one-time equity grant of restricted commonstock with a value of approximately $2,000 with the number of shares of restricted common stock determined by dividing that dollaramount by the closing price of our common stock on the date of grant. These shares of restricted common stock will be fully vestedupon grant. On November 16, 2012, we issued 353 shares to our three non-employee directors as their one-time equity grant. On February14, 2013, we issued an additional 132 shares to our three non-employee directors because the number of shares received by eachdirector on November 16, 2012 was less than the approximate value of $2,000 for the initial grant.

SECURITY OWNERSHIP OF CERTAIN BENEFICIALOWNERS AND MANAGEMENT

The following table sets forth informationknown to MusclePharm with respect to the beneficial ownership of our common stock, $0.001 par value per share, as of August 19,2013, unless otherwise noted, by:

We have determined beneficial ownershipin accordance with the rules of the SEC. Except as indicated by the footnotes below, we believe, based on the information furnishedto us, that the persons and entities named in the table below have sole voting and investment power with respect to all sharesof common stock or Series B Preferred Stock that they beneficially own, subject to applicable community property laws.

Applicable percentage ownership is basedon 8,823,623 shares of common stock and 51 shares of Series B Preferred Stock outstanding at August 19, 2013. For purposes of computingtotal voting percentage, each share of Series B Preferred Stock has 180,073.94 votes, resulting in total outstanding shares forpurposes of calculating voting percentages of 51%. Except as set forth below, the address of the beneficial owner listed in thetable below is c/o MusclePharm Corporation, 4721 Ironton Street, Building A, Denver, Colorado 80239.