ftlf10k_dec312019

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders

of FitLife Brands, Inc. and Subsidiaries

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of FitLife Brands, Inc. and Subsidiaries (the Company) as of December 31, 2019, and the related consolidated statements of operations, stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the entity’s management. Our responsibility is to express an opinion on the entity’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion.

/s/ WEAVER AND TIDWELL, L.L.P.

We have served as the FitLife Brands, Inc. and Subsidiaries auditor since 2019.

Fort Worth, Texas

March 30, 2020

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

FitLife Brands, Inc and subsidiaries

Omaha, Nebraska

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of FitLife Brands, Inc. and Subsidiaries (the “Company”) as of December 31, 2018 and the related consolidated statements of operations, stockholders’ equity and cash flows for the year ended December 31, 2018, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2018, and the consolidated results of their operations and their cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provide a reasonable basis for our opinion.

Weinberg & Company, P.A.

Los Angeles, California

March 22, 2019

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FITLIFE BRANDS, INC.
CONSOLIDATED BALANCE SHEETS

ASSETS:	December 31,	December 31,
	2019	2018

CURRENT ASSETS
Cash	$265,000	$259,000
Accounts receivable, net of allowance of doubtful accounts, $27,000 and $10,000 respectively	2,366,000	1,879,000
Inventories, net of allowance for obsolescence of $130,000 and $107,000, respectively	2,998,000	3,523,000
Prepaid expenses and other current assets	72,000	223,000
Total current assets	5,701,000	5,884,000

Property and equipment, net	136,000	189,000
Right of use asset, net of amortization of $226,000	254,000	-
Goodwill	225,000	225,000
Security deposits	10,000	10,000
TOTAL ASSETS	$6,326,000	$6,308,000

LIABILITIES AND STOCKHOLDERS' EQUITY:

CURRENT LIABILITIES:
Accounts payable	$2,010,000	$2,628,000
Accrued expense and other liabilities	464,000	420,000
Product returns	256,000	446,000
Lease liability - current portion	46,000	-
Notes payable - related parties	-	500,000
Total current liabilities	2,776,000	3,994,000

LONG-TERM LEASE LIABILITY, net of current portion	208,000	-

TOTAL LIABILITIES	2,984,000	3,994,000

STOCKHOLDERS' EQUITY:
Preferred stock, $0.01 par value, 10,000,000 shares authorized, none outstanding
as of December 31, 2019 and December 31, 2018
Preferred stock Series A preferred, $0.01 par value 1,000 shares authorized; 0
and 600 shares issued and outstanding as of December 31, 2019 and December 31, 2018, respectively	-	-
Common stock, $0.01 par value, 15,000,000 shares authorized; 1,054,516 and 1,111,943
issued and outstanding as of December 31, 2019 and December 31, 2018 respectively	12,000	11,000
Treasury stock, 198,731 shares	(1,619,000)	-
Additional paid-in capital	32,055,000	32,107,000
Accumulated deficit	(27,106,000)	(29,804,000)
Total stockholders' equity	$3,342,000	$2,314,000

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$6,326,000	$6,308,000

The accompanying notes are an integral part of these consolidated financial statements

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FITLIFE BRANDS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

	Years ended
	December 31,
	2019	2018


Revenue	$19,497,000	$17,077,000
Cost of goods sold	11,436,000	10,332,000
Gross profit	8,061,000	6,745,000

OPERATING EXPENSES:
General and administrative	3,049,000	3,333,000
Selling and marketing	2,379,000	2,690,000
Depreciation and amortization	52,000	69,000
Total operating expenses	5,480,000	6,092,000
OPERATING INCOME	2,581,000	653,000

OTHER EXPENSES (INCOME)
Interest expense	47,000	133,000
Gain on settlement	(171,000)	-
Total other expenses (income)	(124,000)	133,000

INCOME BEFORE INCOME TAXES	2,705,000	520,000

PROVISION FOR INCOME TAXES	7,000	11,000

NET INCOME	2,698,000	509,000

PREFERRED STOCK DIVIDEND	(63,000)	(105,000)

NET INCOME AVAILABLE TO COMMON SHAREHOLDERS	$2,635,000	$404,000

NET INCOME PER SHARE AVAILABLE TO COMMON SHAREHOLDERS:
Basic	$2.57	$0.37

Diluted	$2.41	$0.37

Basic weighted average common shares	1,026,204	1,094,358

Diluted weighted average common shares	1,092,312	1,094,358

The accompanying notes are an integral part of these consolidated financial statements

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FITLIFE BRANDS, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

						Additional
	Series A Preferred		Common Stock		Treasury	Paid-in	Accumulated
	Shares	Amount	Shares	Amount	Stock	Capital	Deficit	Total

YEAR ENDED DECEMBER 31, 2019

DECEMBER 31, 2018	600	$-	1,111,943	$11,000	$-	$32,107,000	$(29,804,000)	$2,314,000
Fair value of common stock issued for services	-	-	18,082	-	-	47,000	-	47,000
Repurchase of preferred and common stock	(50)	-	(198,731)	-	(1,619,000)	(168,000)	-	(1,787,000)
Conversion of preferred stock to common stock	(550)	-	123,222	1,000	-	(1,000)	-	-
Dividends payments on preferred stock	-	-	-	-	-	(63,000)	-	(63,000)
Fair value of vested common shares and options issued for services	-	-	-	-	-	133,000	-	133,000
Net income	-	-	-	-	-	-	2,698,000	2,698,000

DECEMBER 31, 2019	-	$-	1,054,516	$12,000	$(1,619,000)	$32,055,000	$(27,106,000)	$3,342,000

YEAR ENDED DECEMBER 31, 2018

DECEMBER 31, 2017	-	$-	1,068,171	$11,000	$-	$31,109,000	$(30,208,000)	$912,000
Fair value of common stock issued for services	-	-	43,772	-	-	163,000	-	163,000
Proceeds from issuance of Series A preferred shares	600	-	-	-	-	600,000	-	600,000
Accretion of beneficial conversion feature on Series A preferred shares	-	-	-	-	-	105,000	(105,000)	-
Fair value of vested common shares and options issued for services	-	-	-	-	-	130,000	-	130,000
Net income	-	-	-	-	-	-	509,000	509,000

DECEMBER 31, 2018	600	$-	1,111,943	$11,000	$-	$32,107,000	$(29,804,000)	$2,314,000

The accompanying notes are an integral part of these consolidated financial statements

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FITLIFE BRANDS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

	Years ended December 31,
	2019	2018

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$2,698,000	$509,000
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization	52,000	69,000
Allowance for doubtful accounts	17,000	(103,000)
Allowance for inventory obsolescence	23,000	58,000
Common stock issued for services	71,000	163,000
Fair value of options issued for services	111,000	130,000
Loss on disposal of assets	-	34,000
Right of use asset net of amortization and lease liability	(2,000)	-
Changes in operating assets and liabilities:
Accounts receivable - trade	(505,000)	1,334,000
Inventories	502,000	(707,000)
Prepaid expense	151,000	(2,000)
Customer note receivable	-	5,000
Security deposit	-	12,000
Accounts payable	(618,000)	(346,000)
Accrued liabilities and other liabilities	(50,000)	(192,000)
Product returns	(189,000)	(706,000)
Net cash provided by operating activities	2,261,000	258,000

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of assets	-	4,000
Net cash provided by investing activities	-	4,000

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of notes payable	300,000	500,000
Proceeds from issuance of Series A preferred stock	-	600,000
Dividend payments on preferred stock	(63,000)	-
Repurchases of common stock	(1,524,000)	-
Repurchases of preferred stock	(168,000)	-
Repayment of line of credit	-	(1,950,000)
Repayments of term loan	-	(415,000)
Repayments of note payable	(800,000)	-
Net cash used in financing activities	(2,255,000)	(1,265,000)

CHANGE IN CASH	6,000	(1,003,000)
CASH, BEGINNING OF PERIOD	259,000	1,262,000
CASH, END OF PERIOD	$265,000	$259,000

Supplemental disclosure operating activities
Cash paid for interest	$47,000	$133,000

Non-cash investing and financing activities
Accretion of beneficial conversion feature on Series A preferred stock	-	$105,000
Recording of lease asset and liability upon adoption of ASU-2016-02	$343,000	-
Conversion of Series A preferred stock into common stock	$567,000	-

The accompanying notes are an integral part of these condensed consolidated financial statements

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FITLIFE BRANDS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED DECEMBER 31, 2019 AND 2018

NOTE 1. DESCRIPTION OF BUSINESS

Summary

FitLife Brands, Inc. (the “Company”) is a national provider of innovative and proprietary nutritional supplements for health-conscious consumers marketed under the brand names NDS Nutrition, PMD Sports, SirenLabs, CoreActive, and Metis Nutrition (together, “NDS Products”). In September 2015, the Company acquired iSatori, Inc. (“iSatori”) and as a result, the Company added three brands to its product portfolio, including iSatori, BioGenetic Laboratories, and Energize (together, “iSatori Products”). The NDS Products are distributed principally through franchised General Nutrition Centers, Inc. (“GNC”) stores located both domestically and internationally, and, with the launch of Metis Nutrition, through corporate GNC stores in the United States. The iSatori Products are sold through more than 25,000 retail locations, which include specialty, mass, and online.

The Company was incorporated in the State of Nevada on July 26, 2005. In October 2008, the Company acquired the assets of NDS Nutritional Products, Inc., a Nebraska corporation, and moved those assets into its wholly owned subsidiary NDS Nutrition Products, Inc., a Florida corporation (“NDS”). The Company’s NDS Products are sold through NDS and the iSatori Products are sold through iSatori, Inc., a Delaware corporation and a wholly owned subsidiary of the Company.

FitLife Brands is headquartered in Omaha, Nebraska. For more information on the Company, please go to www.fitlifebrands.com. The Company’s Common Stock currently trades under the symbol “FTLF” on the OTC: PINK market.

Recent Developments

Reverse/Forward Split

On April 11, 2019, the Company filed two Certificates of Change with the Secretary of State of the State of Nevada, the first to effect a reverse stock split of both the Company’s issued and outstanding and authorized Common Stock, par value $0.01 per share (“Common Stock”), at a ratio of 1-for-8,000 (the “Reverse Split”), and the second to effect a forward stock split of both the Company’s issued and outstanding and authorized Common Stock at a ratio of 800-for-1 (the “Forward Split”, and together with the Reverse Split, the “Reverse/Forward Split”). The Reverse/Forward Split became effective, and the Company’s Common Stock began trading on a post-split basis, on Tuesday, April 16, 2019.

The Company did not issue any fractional shares as a result of the Reverse/Forward Split. Holders of fewer than 8,000 shares of the Common Stock immediately prior to the Reverse/Forward Split received cash in lieu of fractional shares based on the 5-day volume weighted average price of the Company’s Common Stock immediately prior to the Reverse/Forward Split, which was $0.57 per pre-split share. As a result, such holders ceased to be stockholders of the Company. Holders of more than 8,000 shares of Common Stock immediately prior to the Reverse/Forward Split did not receive fractional shares; instead any fractional shares resulting from the Reverse/Forward Split were rounded up to the next whole share.

As a result of the Reverse/Forward Split, the number of shares of Company Common Stock authorized for issuance under the Company’s Articles of Incorporation, as amended, was decreased from 150,000,000 shares to 15,000,000 shares. The Reverse/Forward Split did not affect the Company’s preferred stock, nor did it affect the par value of the Company’s Common Stock.

The share and per share amounts included in these consolidated financial statements and footnotes have been retroactively adjusted to reflect the 1-for-10 aspect of the Reverse/Forward Split as if it occurred as of the earliest period presented.

Line of Credit Agreement

On September 24, 2019, the Company entered into a Revolving Line of Credit Agreement (the "Line of Credit Agreement") with Mutual of Omaha Bank (the "Lender") providing the Company with a $2.5 million revolving line of credit (the "Line of Credit"). The Line of Credit allows the Company to request advances thereunder and to use the proceeds of such advances for working capital purposes until September 23, 2020 (the “Maturity Date”), unless renewed at maturity upon approval by the Company’s Board of Directors and the Lender. The Line of Credit is secured by all assets of the Company.

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Advances drawn under the Line of Credit bear interest at an annual rate of the one-month LIBOR rate plus 2.75%, and each advance will be payable on the Maturity Date with the interest on outstanding advances payable monthly. The Company may, at its option, prepay any borrowings under the Line of Credit, in whole or in part at any time prior to the Maturity Date, without premium or penalty.

The Line of Credit Agreement includes customary events of default. If any such event of default occurs, the Lender may declare all outstanding loans under the Line of Credit to be due and payable immediately.

Repayment of Outstanding Notes

On December 26, 2018, the Company issued a line of credit promissory note to Sudbury Capital Fund, LP ("Sudbury") in the principal amount of $600,000 (the “Sudbury Note”), with an initial advance to the Company in the amount of $300,000. In addition, on December 26, 2018, the Company also issued a promissory note to Dayton Judd, the Company’s Chair of the Board and Chief Executive Officer, in the principal amount of $200,000 (the “Judd Note”) (together with the Sudbury Note, the “Notes”).

The Notes matured on the earlier to occur of a Change in Control of the Company, as defined in the Notes, or December 31, 2019, and required monthly principal and interest payments beginning April 1, 2019, with a final payment of unpaid principal and interest due December 31, 2019. Proceeds from the sale of the Notes, along with existing cash balances, were used to retire all outstanding indebtedness under the terms of the Merchant Agreement, totaling approximately $590,000 at December 26, 2018.

On September 24, 2019, the Company repaid all outstanding balances due on the Notes in the aggregate principal amount, including accrued but unpaid interest thereon, of $615,000. Mr. Judd is the managing partner of Sudbury. As a result of the repayment of the Notes, the Company terminated its line of credit entered into between the Company and Sudbury on December 26, 2018 providing for maximum borrowings of up to $600,000.

Amendment of Share Repurchase Plan

On September 23, 2019, the Company's approved an amendment the Company’s share repurchase program as approved on August 16, 2019, pursuant to which the Board authorized management to repurchase up to $500,000 of the Company's Common Stock, over the next 24 months (the "Share Repurchase Program"), which Share Repurchase Program was previously reported on the Company's Current Report on Form 8-K filed August 20, 2019. The Board approved an amendment to the Share Repurchase Program to increase the repurchase of up to $1,000,000 of the Company's Common Stock, its Series A Convertible Preferred Stock, par value $0.01 per share ("Series A Preferred"), and warrants to purchase shares of the Company's Common Stock ("Warrants"), over the next 24 months, at a purchase price, in the case of Common Stock, equal to the fair market value of the Company's Common Stock on the date of purchase, and in the case of Series A Preferred and Warrants, at a purchase price determined by management, with the exact date and amount of such purchases to be determined by management.

On November 6, 2019, the Company’s Board amended the previously approved Share Repurchase Program to increase the amount of authorized repurchases to $2.5 million. All other terms of the Share Repurchase Program remain unchanged.

The Company intends to conduct its Share Repurchase Program in accordance with all applicable securities laws and regulations, including Rule 10b-18 of the Securities Exchange Act of 1934, as amended. Repurchases may be made at management's discretion from time to time in the open market or through privately negotiated transactions. The Company may suspend or discontinue the Share Repurchase Program at any time, and may thereafter reinstitute purchases, all without prior announcement.

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During the year ended December 31, 2019, excluding the 99,238 shares repurchased for total consideration of $569,000 as a result of the Reverse/Forward split, the Company repurchased 99,493 shares of Common Stock, or approximately 9% of the issued and outstanding shares of the Company, through both open market and private transactions, as follows:

Trade date	Total number of shares purchased	Average price paid per share	Total number of shares purchased as part of publicly announced programs	Dollar value of shares that may yet be purchased
August 2019	-	$-	-	$500,000
September 2019	82,216	$9.96	82,216	$180,937
October 2019	-	$-	-	$180,937
November 2019	7,000	$13.35	7,000	$1,419,487
December 2019	10,277	$13.41	10,277	$1,281,717
Subtotal	99,493	$10.56	99,493

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America. Significant accounting policies are as follows:

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and NDS Nutrition Products, Inc. Intercompany accounts and transactions have been eliminated in the consolidated financial statements.

Use of Estimates and Assumptions

The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) the disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published, and (iii) the reported amount of net sales and expense recognized during the periods presented.

Those estimates and assumptions include estimates for reserves of uncollectible accounts receivable, allowance for inventory obsolescence, depreciable lives of property and equipment, analysis of impairment of goodwill, realization of deferred tax assets, accruals for potential liabilities and assumptions made in valuing stock instruments issued for services. Management evaluates these estimates and assumptions on a regular basis. Actual results could differ from those estimates.

Revenue Recognition

The Company’s revenue is comprised of sales of nutritional supplements to consumers, primarily through GNC stores.

The Company accounts for revenues in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers. The underlying principle of ASC 606 is to recognize revenue to depict the transfer of goods or services to customers at the amount expected to be collected. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contract(s), which includes (1) identifying the contract(s) or agreement(s) with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. Under ASC 606, revenue is recognized when performance obligations under the terms of a contract are satisfied, which occurs for the Company upon shipment or delivery of products or services to our customers based on written sales terms, which is also when control is transferred. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring the products or services to a customer.

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All products sold by the Company are distinct individual products and consist of nutritional supplements and related supplies. The products are offered for sale solely as finished goods, and there are no performance obligations required post-shipment for customers to derive the expected value from them. Other than promotional activities, which can vary from time to time but nevertheless are entirely within the Company’s control, contracts with customers contain no incentives or discounts that could cause revenue to be allocated or adjusted over time.

Control of products we sell transfers to customers upon shipment from our facilities, and the Company’s performance obligations are satisfied at that time. Shipping and handling activities are performed before the customer obtains control of the goods and therefore represent a fulfillment activity rather than promised goods to the customer. Payment for sales are generally made by check, credit card, or wire transfer. Historically the Company has not experienced any significant payment delays from customers.

For direct-to-consumer sales, the Company allows for returns within 30 days of purchase. Our wholesale customers such as GNC, may return products to the Company under certain circumstances, which include expired or soon-to-be-expired products located in GNC corporate stores or at any of its distribution centers, and products that are subject to a recall or that contain an ingredient or ingredients that are subject to a recall by the U.S. Food and Drug Administration.

A right of return does not represent a separate performance obligation, but because customers are allowed to return products, the consideration to which the Company expects to be entitled is variable. Upon evaluation of returns, the Company determined that less than 5% of products are returned, and therefore believes it is probable that such returns will not cause a significant reversal of revenue in the future. We assess our contracts and the reasonableness of our conclusions on a quarterly basis.

Customer Concentration

Total net sales to GNC during 2019 and 2018 were $14,795,000, and $13,102,000, respectively, representing 75% and 77% of total revenue, respectively. Accounts receivable attributable to GNC before adjusting for product return reserves as of December 31, 2019 and 2018 were $2,038,000 and $1,543,000, respectively, representing 87% and 82% of the Company’s total accounts receivable balance, respectively. The loss of this customer would have a material adverse effect on the Company’s business, financial condition, and results of operation.

Accounts Receivable and Allowance for Doubtful Accounts

All of the Company’s accounts receivable balance is related to trade receivables. Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable. The Company will maintain allowances for doubtful accounts, estimating losses resulting from the inability of its customers to make required payments for products. Accounts with known financial issues are first reviewed and specific estimates are recorded. The remaining accounts receivable balances are then grouped into categories by the amount of days the balance is past due, and the estimated loss is calculated as a percentage of the total category based upon past history. Account balances are charged off against the allowance when it is probable that the receivable will not be recovered. We maintain an insurance policy for iSatori Products for international shipments, which protects the Company in the event the international distributor does not or cannot remit payment.

As of December 31, 2019 and 2018, the Company had provided a reserve for doubtful accounts of $27,000 and $10,000, respectively.

Product Returns, Sales Incentives and Other Forms of Variable Consideration

In measuring revenue and determining the consideration the Company is entitled to as part of a contract with a customer, the Company takes into account the related elements of variable consideration. Such elements of variable consideration include, but are not limited to, product returns and sales incentives, such as markdowns and margin adjustments. For these types of arrangements, the adjustments to revenue are recorded at the later of when (i) the Company recognizes revenue for the transfer of the related products to the customers, or (ii) the Company pays, or promises to pay, the consideration.

We currently have a 30-day product return policy for NDS Products, which allows for a 100% sales price refund, less a 20% restocking fee, for the return of unopened and undamaged products purchased from us online through one of our websites. Product sold to GNC may be returned from store shelves or the distribution center in the event product is damaged, short dated, expired or recalled. Information for product returns is received on regular basis and adjusted for accordingly. Adjustments for returns are based on factual information and historical trends for both NDS products and iSatori products and are specific to each distribution channel. We monitor, among other things, remaining shelf life and sell through data on a weekly basis. If we determine there are any risks or issues with any specific products, we accrue sales return allowances based on management’s assessment of the overall risk and likelihood of returns in light of all information available.

GNC maintains a customer satisfaction program that allows customers to return product to the store for credit or refund. Subject to certain terms and restrictions, GNC may require reimbursement from vendors for unsaleable returned product through either direct payment or credit against a future invoice. We also support a product return policy for iSatori Products, whereby customers can return product for credit or refund. Product returns can and do occur from time to time and can be material.

For the sale of goods with a right of return, the Company estimates variable consideration using the most likely amount method and recognizes revenue for the consideration it expects to be entitled to when control of the related product is transferred to the customers and records a sales return accrual within Accrued expense and other liabilities for the amount it expects to credit back its customers. Under this method, certain forms of variable consideration are based on expected sell-through results, which requires subjective estimates. These estimates are supported by historical results as well as specific facts and circumstances related to the current period. In addition, the Company recognizes an asset included in Inventories, net and a corresponding adjustment to Cost of Goods Sold for the right to recover goods from customers associated with the estimated returns. The sales return accrual and corresponding asset include estimates that directly impact reported revenue. These estimates are calculated based on a history of actual returns, estimated future returns and information provided by customers regarding their inventory levels. Consideration of these factors results in an estimate for anticipated sales returns that reflects increases or decreases related to seasonal fluctuations. In addition, as necessary, sales return accruals and the related assets may be established for significant future known or anticipated events. The types of known or anticipated events that are considered, and will continue to be considered, include, but are not limited to, changes in the retail environment and the Company's decision to continue to support new and existing products.

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Information for product returns is received on regular basis and adjusted for accordingly. Adjustments for returns are based on factual information and historical trends for both NDS products and iSatori products and are specific to each distribution channel. We monitor, among other things, remaining shelf life and sell-through data on a weekly basis. If we determine there are any risks or issues with any specific products, we accrue sales return allowances based on management’s assessment of the overall risk and likelihood of returns in light of all information available.

Regarding incentives, the Company accrues an estimate of 7% for promotional expense it calls “vendor funded discounts” at the time of sale. The expense is recorded as a contra-revenue account, and the expected incentive costs are never included in accounts receivable. As such, an allowance account for incentives is not required or necessary. Actual incentive costs are reconciled to the estimate on a regular basis.

Total allowance for product returns, sales returns and incentive programs as of December 31, 2019 and 2018 amounted to $256,000 and $446,000, respectively.

Cost of Goods Sold

Cost of goods sold is comprised of the costs of products, repacking fees, in-bound freight charges, as well as certain internal transfer costs. Expense not related to the production of our products is classified as operating expense.

Delivery and Handling Expense

Shipping and handling costs are comprised of purchasing and receiving costs, inspection costs, warehousing costs, transfer freight costs, and other costs associated with product distribution and are included as part of operating expense.

Cash and Cash Equivalents

The Company’s cash balances on deposit with banks are guaranteed by the Federal Deposit Insurance Corporation up to $250,000 at December 31, 2019. The Company may be exposed to risk for the amounts of funds held in bank accounts more than the insurance limit. In assessing the risk, the Company’s policy is to maintain cash balances with high-quality financial institutions. The Company had cash balances more than the guarantee during the years ended December 31, 2019 and 2018.

Inventory

Inventory is stated at the lower of cost to purchase and/or manufacture the inventory or the current estimated market value of the inventory. We regularly review our inventory quantities on hand and record a provision for excess and obsolete inventory based primarily on our estimated forecast of product demand and/or our ability to sell the product(s) concerned and production requirements. Demand for our products can fluctuate significantly. Factors that could affect demand for our products include unanticipated changes in consumer preferences, general market conditions or other factors, which may result in cancellations of advance orders or a reduction in the rate of reorders placed by customers. Additionally, our management’s estimates of future product demand may be inaccurate, which could result in an understated or overstated provision required for excess and obsolete inventory.

As of December 31, 2019 and 2018, the aggregate allowance for expiring, slow moving and excess inventory amounted to $130,000 and $107,000, respectively.

Property and Equipment

Property and equipment is recorded at cost and depreciated over the estimated useful lives of the assets using the straight-line method. The Company amortizes leasehold improvements over the estimated life of these assets or the term of the lease, whichever is shorter. When items are retired or otherwise disposed of, income is charged or credited for the difference between net book value and proceeds realized. Ordinary maintenance and repairs are charged to expense as incurred, and replacements and betterments are capitalized.

The range of estimated useful lives used to calculate depreciation for principal items of property and equipment are as follows:

Asset Category		Depreciation / Amortization Period
Furniture and fixtures		3 years
Office equipment		3 years
Leasehold improvements		5 years

Management regularly reviews property, equipment and other long-lived assets for possible impairment. This review occurs annually or more frequently if events or changes in circumstances indicate the carrying amount of the asset may not be recoverable. Based upon management’s annual assessment, there were no indicators of impairment of the Company’s property and equipment and other long-lived assets as of December 31, 2019 and 2018.

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Goodwill and Intangible Assets

The Company adopted FASB ASC Topic 350 Goodwill and Other Intangible Assets. In accordance with ASC Topic 350, goodwill, which represents the excess of the purchase price and related costs over the value assigned to net tangible and identifiable intangible assets of businesses acquired and accounted for under the purchase method, acquired in business combinations is assigned to reporting units that are expected to benefit from the synergies of the combination as of the acquisition date. Under this standard, goodwill and intangibles with indefinite useful lives are no longer amortized. The Company assesses goodwill and indefinite-lived intangible assets for impairment annually during the fourth quarter, or more frequently if events and circumstances indicate impairment may have occurred in accordance with ASC Topic 350. If the carrying value of a reporting unit's goodwill exceeds its implied fair value, the Company records an impairment loss equal to the difference. ASC Topic 350 also requires that the fair value of indefinite-lived purchased intangible assets be estimated and compared to the carrying value. The Company recognizes an impairment loss when the estimated fair value of the indefinite-lived purchased intangible assets is less than the carrying value.

Identifiable intangible assets are stated at cost and accounted for based on whether the useful life of the asset is finite or indefinite. Identified intangible assets with finite useful lives are amortized using the straight-line methods over their estimated useful lives, which was originally ten years. Intangible assets with indefinite lives are not amortized to operations, but instead are reviewed for impairment at least annually, or more frequently if there is an indicator of impairment. The Company does not own any indefinite lived intangible assets.

There were no impairment charges incurred during the years ended December 31, 2019 and 2018.

Income Taxes

The Company accounts for income taxes under Financial Accounting Standards Board’s (“FASB”) ASC 740 “Income Taxes”. Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The deferred tax assets of the Company relate primarily to operating loss carry-forwards for federal income tax purposes. A full valuation allowance for deferred tax assets has been provided because the Company believes it is not more likely than not that the deferred tax asset will be realized. Realization of deferred tax assets is dependent on the Company generating sufficient taxable income in future periods.

The Company periodically evaluates its tax positions to determine whether it is more likely than not that such positions would be sustained upon examination by a tax authority for all open tax years, as defined by the statute of limitations, based on their technical merits. The Company accrues interest and penalties, if incurred, on unrecognized tax benefits as components of the income tax provision in the accompanying consolidated statements of operations. As of December 31, 2019, and 2018, the Company has not established a liability for uncertain tax positions.

Net Income Per Share

Basic net income per share is computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted earnings per share is computed by dividing the net income applicable to common stockholders by the weighted average number of common shares outstanding plus the number of additional common shares that would have been outstanding if all dilutive potential common shares had been issued using the treasury stock method. Potential common shares are excluded from the computation when their effect is antidilutive. The dilutive effect of potentially dilutive securities is reflected in diluted net income per share if the exercise prices were lower than the average fair market value of common shares during the reporting period.

The following potentially dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive:

	December 31,
	2019	2018
Series A Preferred Stock	-	1,304,348
Warrants	-	39,130
Options	34,075	156,209
Total	34,075	1,499,687‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬

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Fair Value Measurements

The Company uses various inputs in determining the fair value of its investments and measures these assets on a recurring basis. Financial assets recorded at fair value in the balance sheets are categorized by the level of objectivity associated with the inputs used to measure their fair value. ASC 820 establishes a three-level valuation hierarchy for the use of fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date:

●	Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

●

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

●

Level 3 - Inputs that are both significant to the fair value measurement and unobservable. These inputs rely on management's own assumptions about the assumptions that market participants would use in pricing the asset or liability. The unobservable inputs are developed based on the best information available in the circumstances and may include the Company’s own data.

The carrying amounts of financial assets and liabilities, such as cash and cash equivalents, accounts receivable and accounts payable, approximate their fair values because of the short maturity of these instruments. The carrying values of the line of credit, notes payable and long-term financing obligations approximate their fair values due to the fact that the interest rates on these obligations are based on prevailing market interest rates.

Stock Compensation Expense

The Company periodically issues stock options and warrants to employees and non-employees in non-capital raising transactions for services rendered. The Company accounts for stock option and warrant grants issued and vesting to employees based on the authoritative guidance provided by the Financial Accounting Standards Board (“FASB”) where the value of the award is measured on the date of grant and recognized as compensation on the straight-line basis over the vesting period.

From prior periods until December 31, 2018, the Company accounted for share-based compensation issued to non-employees and consultants in accordance with the provisions of FASB ASC 505-50, Equity-Based Payments to Non-Employees. Measurement of share-based payment transactions with non-employees is based on the fair value of whichever is more reliably measurable: (a) the goods or services received or (b) the equity instruments issued. The final fair value of the share-based payment transaction is determined at the performance completion date.

In June 2018, the FASB issued ASU No. 2018-07, Compensation - Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”). The guidance was issued to simplify the accounting for share-based transactions by expanding the scope of ASU 2018-07 from only being applicable to share-based payments to employees to also include share-based payment transactions for acquiring goods and services from nonemployees. As a result, nonemployee share-based transactions will be measured by estimating the fair value of the equity instruments at the grant date, taking into consideration the probability of satisfying performance conditions. We adopted ASU 2018-07 on January 1, 2019. The adoption of the standard did not have a material impact on our financial statements for the year ended December 31, 2019 or the previously reported financial statements.

The fair value of the Company’s stock option and warrant grants are estimated using the Black-Scholes option pricing model, which uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or warrants, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes option pricing model and based on actual experience. The assumptions used in the Black-Scholes option pricing model could materially affect compensation expense recorded in future periods.

Segments

The Company operates in one segment for the distribution of our products. In accordance with the “Segment Reporting” Topic of the ASC, the Company’s chief operating decision maker has been identified as the Chief Executive Officer and President, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Existing guidance, which is based on a management approach to segment reporting, establishes requirements to report selected segment information quarterly and to report annually entity-wide disclosures about products and services, major customers, and the countries in which the entity holds material assets and reports revenue. All material operating units qualify for aggregation under “Segment Reporting” due to their similar customer base and similarities in: economic characteristics; nature of products and services; and procurement, manufacturing and distribution processes. Since the Company operates in one segment, all financial information required by “Segment Reporting” can be found in the accompanying consolidated financial statements.

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Recent Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02, Leases. This update requires the recognition of a right-of-use asset and a corresponding lease liability, initially measured at the present value of the lease payments, for all leases with terms longer than 12 months. For operating leases, the asset and liability will be expensed over the lease term on a straight-line basis, with all cash flows included in the operating section of the statement of cash flows. For finance leases, interest on the lease liability will be recognized separately from the amortization of the right-of-use asset in the statement of comprehensive income and the repayment of the principal portion of the lease liability will be classified as a financing activity while the interest component will be included in the operating section of the statement of cash flows. ASU 2016-02 is effective for annual and interim reporting periods beginning after December 15, 2018.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

Reclassification

During 2019, the Company changed the presentation of its accounting for customer returns. Previously, the sales return reserve was deducted from accounts receivable. Beginning in 2019, the reserve is shown as a current liability on the consolidated balance sheet. The presentation of the customer return reserve has been changed in the accompanying 2018 consolidated financial statements to be consistent with the Company’s current approach.

NOTE 3 – MERCHANT AGREEMENT

In December 2017, the Company, through NDS and iSatori (together, the “Subsidiaries”), entered into a Merchant Agreement with Compass Bank, d/b/a Commercial Billing Service (“Compass”) (“Factor”). Under the terms of the Merchant Agreement, the Company sold to Compass certain accounts owing from customers of such Subsidiaries, including GNC. All amounts due under the terms of the Merchant Agreement, totaling up to $5.0 million, was guaranteed by the Company under the terms of a continuing guarantee. The Company paid a fee calculated based on the London Interbank Offering Rate (“LIBOR”) plus 550 basis points, which fee was based on the outstanding gross amount of accounts receivable factored in excess of total cash collected by Compass from customers against such amounts. The applicable LIBOR rate for the year ended December 31, 2018 was 2.2%. Additionally, the Company was charged a non-utilization fee by which the average outstanding amount of obligations was less than $2.0 million, as amended. The Company had pledged collateral of all present and future inventory, accounts, accounts receivable, general intangibles and returned goods, together with all reserves, balances, deposits, and property at any time owing to the credit of the Company with Compass. During the year ended December 31, 2017, no amounts were factored under this agreement.

During the year ended December 31, 2018, total accounts receivable factored under this agreement amounted to $14.6 million, of which, $14.0 million were ultimately collected by Compass from the corresponding customers as of December 31, 2018. In addition, the Company also incurred various factoring fees in the aggregate of $128,000, which was reported as part of interest expense.

In December 2018, Compass informed the Company that the agreement would not be renewed upon its expiration in February 2019. As a result, the Company paid Compass $590,000 to settle certain factored receivables that were not yet collected by Compass at that time. As of December 31, 2018, the Company had settled all amounts due to Compass pursuant to this agreement and the agreement was terminated.

NOTE 4. INVENTORIES

At December 31, 2019, the value of the Company’s inventory was $2,998,000. At December 31, 2018, the value of the Company’s inventory was $3,523,000.

	December 31,
	2019	2018
Finished goods	$2,688,000	$3,168,000
Components	440,000	462,000
Allowance for obsolescence	(130,000)	(107,000)
Total	$2,998,000	$3,523,000

NOTE 5. PROPERTY AND EQUIPMENT

The Company had fixed assets as of December 31, 2019 and 2018 as follows:

	December 31,
	2019	2018
Equipment	$902,000	$902,000
Accumulated depreciation	(766,000)	(713,000)
Total	$136,000	$189,000

Depreciation expense was $52,000 for December 31, 2019 compared to $69,000 for December 31, 2018. During the year ended December 31, 2018 the Company sold property and equipment with a net book value of $38,000 for proceeds of $4,000, resulting in a loss on sale of $34,000, which has been included as an operating expense in the accompanying statement of operations.

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NOTE 6. NOTES PAYABLES

Line of Credit and Term Loan – US Bank

The Company previously obtained a line of credit (“LOC”) of $3.0 million and a separate term loan of $2.6 million (the “Term Note”) with U.S. Bank. Both the LOC and the Term Note were secured by the Company’s tangible and intangible assets and had an average interest rate of 5% per annum. The LOC, as amended, matured in December 2017, while the Term Note did not mature until August 2018. As of December 31, 2017, the outstanding balance of these notes payable totaled $2,365,000 and was deemed in default due to non-compliance with certain financial covenants.

In January 2018, the Company paid U.S. Bank a total of $2,365,000 to settle the outstanding balance of the LOC and the Term Note. As of December 31, 2018, the LOC and Term Note had been fully paid.

Notes Payable – Related Parties

On December 26, 2018, the Company issued a line of credit promissory note to Sudbury Capital Fund, LP, an entity controlled by Dayton Judd, the Company’s Chief Executive Officer and Chair of the Board, in the principal amount of $600,000, with an initial advance to the Company in the amount of $300,000 which was outstanding at December 31, 2018. During the three months ended March 31, 2019, an additional $300,000 was advanced to the Company, resulting in aggregate borrowings of $600,000. In addition, on December 26, 2018, the Company also issued a promissory note to Mr. Judd in the principal amount of $200,000. On September 24, 2019, the Company repaid all outstanding balances due under the terms of the Notes in the aggregate principal amount, including accrued but unpaid interest thereon, of $615,000. As a result of the repayment of the Notes, the Company terminated its line of credit entered into between the Company and Sudbury on December 26, 2018 providing for maximum borrowings of up to $600,000.

As of December 31, 2019 and 2018, the aggregate balance of the Notes amounted to $0 and $501,000, respectively, including accrued interest of $0 and $1,000, respectively.

Line of Credit – Mutual of Omaha Bank

On September 24, 2019, the Company entered into entered into a Line of Credit Agreement with the Lender providing the Company with a $2.5 million revolving Line of Credit. The Line of Credit allows the Company to request advances thereunder and to use the proceeds of such advances for working capital purposes until the Maturity Date, or unless renewed at maturity upon approval by the Company’s Board and the Lender. The Line of Credit is secured by all assets of the Company.

Subsequent to the year ended December 31, 2019, the Lender advanced the Company $2.5 million under the Line of Credit. The advance was intended to provide the Company with additional liquidity in anticipation of an expected negative impact on sales to GNC and our other wholesale customers resulting from the COVID-19 outbreak.

NOTE 7. EQUITY

Common Stock

The Company is authorized to issue 15.0 million shares of Common Stock, $0.01 par value per share, of which 1,054,516 and 1,111,943 shares of Common Stock were issued and outstanding as of December 31, 2019 and 2018, respectively.

Reverse/Forward Split

On April 11, 2019, the Company filed two Certificates of Change with the Secretary of State of the State of Nevada, the first to effect a reverse stock split of both the Company’s issued and outstanding and authorized Common Stock, at a ratio of 1-for-8,000, and the second to effect a forward stock split of both the Company’s issued and outstanding and authorized Common Stock at a ratio of 800-for-1. The Reverse/Forward Split became effective, and the Company’s Common Stock began trading on a post-split basis, on Tuesday, April 16, 2019.

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The share and per share amounts included in these unaudited interim condensed consolidated financial statements and footnotes have been retroactively adjusted to reflect the 1-for-10 aspect of the Reverse/Forward Split as if it occurred as of the earliest period presented.

The following were Common Stock transactions during the year ended December 31, 2019:

During the year ended December 31, 2019, the Company issued 18,082 shares of Common Stock with a fair value of $47,000 to employees and directors for services rendered. The shares were valued at the respective date of issuance. As of December 31, 2019, there was unearned compensation of $36,800 that will be amortized as a compensation cost on a straight-line basis through 2020.

The following were Common Stock transactions during the year ended December 31, 2018:

During the year ended December 31, 2018, the Company issued 43,772 shares of Common Stock with a fair value of $143,000 to employees and directors for services rendered. The shares were valued at the respective date of issuance.

In July 2018, in connection with the appointment of Mr. Dayton Judd as the Company’s Chief Executive Officer, the Company granted Mr. Judd an aggregate of 45,000 shares of restricted Common Stock, which include vesting conditions subject to the achievement of certain market prices of the Company’s Common Stock. Such shares are also subject to forfeiture in the event Mr. Judd resigns from his position or is terminated by the Company. As the vesting of the 45,000 shares of restricted Common Stock was subject to certain market conditions, pursuant to current accounting guidelines, the Company determined the fair value to be $105,000, computed using the Monte Carlo simulations on a binomial model with the assistance of a valuation specialist with a derived service period of three years. During the year ended December 31, 2018, the Company recorded compensation expense of $20,000 to amortize the fair value of these restricted common shares based upon the prorated derived service period.

Withdrawal of Former Series A Preferred, Series B Preferred and Series C Preferred

On November 13, 2018, the Company filed Certificates of Withdrawal with the Secretary of State of the State of Nevada for its (i) Series A Convertible Preferred Stock, (ii) 10% Cumulative Perpetual Series B Preferred Stock and (iii) Series C Convertible Preferred Stock, none of which were issued and outstanding, thereby withdrawing each of the series of preferred stock and returning all previously designated shares to their status as authorized preferred stock available for issuance.

Series A Preferred Stock

The Company is authorized to issue up to 10 million shares of preferred stock, par value $0.01 per share.

In November 2018, the Company issued 600 shares of the Company’s Series A Convertible Preferred Stock in exchange for cash of $600,000, or $1,000 per share, to three investors, two of whom were related-party investors.

During November 2019, the Company repurchased and retired 50 shares of Series A Convertible Preferred Stock. During December 2019, the remaining 550 shares of Series A Convertible Preferred Stock were converted into Common Stock in accordance with the terms of the Certificate of Designations. As a result, no shares of Series A Preferred Stock were outstanding as of December 31, 2019.

During 2019, the Company paid $63,000 for preferred dividends.

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Options

The following table summarizes option activity:

	Number of Options	Weighted Average Exercise Price	Weighted Average Remaining Life (Years)
Outstanding, December 31, 2017	87,028	$27.10
Issued	87,500	3.50
Exercised	-
Forfeited	(20,007)	48.00
Outstanding, December 31, 2018	154,521	$13.10
Issued	8,000	$6.85
Exercised	-
Forfeited	(13,236)	$24.45
Outstanding, December 31, 2019	149,285	$11.76	5.03

								Exercisable
Exercise Price Per Share		Total Number of Options		Weighted Average Remaining Life (Years)		Weighted Average Exercise Price		Number of Vested Options		Weighted Average Exercise Price
$	2.80 - $23.00		143,710		5.08	$	8.72		112,210	$	10.09
$	23.10 - $144.30		5,575		3.77	$	90.20		5,575	$	90.20
			149,285		5.03	$	11.76		117,785	$	13.88

The closing stock price for the Company’s stock on December 31, 2019 was $14.10. As such, there was an intrinsic value of outstanding options of $1,027,000.

During the year ended December 31, 2019, the Company granted stock options to employees for services rendered to purchase 8,000 shares of Company Common Stock. The stock options are exercisable at a price of $6.85 per share, expire in five years and vest as follows: one-third vested immediate upon issuance, and the remainder vest equally in equal annual installments over a period of two years from grant date.

Total fair value of these options at grant date was approximately $38,000, which was determined using the Black-Scholes option pricing model with the following average assumption: stock price of $6.85 per share, expected term of three years, volatility of 108%, dividend rate of 0% and risk-free interest rate of 2.18%. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of measurement corresponding with the expected term of the share option award; the expected term represents the weighted-average period of time that share option awards granted are expected to be outstanding giving consideration to vesting schedules and historical participant exercise behavior; the expected volatility is based upon historical volatility of the Company’s Common Stock; and the expected dividend yield is based on the fact that the Company has not paid dividends in the past and does not expect to pay dividends in the future.

During the year ended December 31, 2019, the Company recognized compensation expense of $111,000 based upon the vesting of outstanding options. As of December 31, 2019, there was $54,000 of unvested stock compensation that will be recognized as an expense in future periods as the options vest.

During the year ended December 31, 2018, the Company granted stock options to employees for services rendered to purchase 87,500 shares of Common Stock. Of these options, 70,500 are exercisable at a price of $2.80 and expire in ten years, and 17,000 are exercisable at a price of $4.20 per share and expire in five years. One-third of the options vested immediate upon issuance, and the remainder vest equally in equal annual installments over a period of two years from grant date.

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Total fair value of these options at grant date was approximately $187,000, which was determined using the Black-Scholes option pricing model with the following average assumption: stock price of $2.80 per share, expected term of six years, volatility of 88%, dividend rate of 0% and risk-free interest rate of 2.92%. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of measurement corresponding with the expected term of the share option award; the expected term represents the weighted-average period of time that share option awards granted are expected to be outstanding giving consideration to vesting schedules and historical participant exercise behavior; the expected volatility is based upon historical volatility of the Company’s Common Stock; and the expected dividend yield is based on the fact that the Company has not paid dividends in the past and does not expect to pay dividends in the future.

During the year ended December 31, 2018, the Company recognized compensation expense of $130,000 based upon the vesting of outstanding options. As of December 31, 2018, there was $132,000 of unvested stock compensation that will be recognized as an expense in future periods as the options vest.

Warrants

The following table summarizes warrant activity:

	Number of Warrants	Weighted Average Exercise Price	Weighted Average Remaining Life (Years)
Outstanding, December 31, 2017	6,062	$129.90
Issued	39,130	4.60
Exercised	-	-
Forfeited	(6,062)	-
Outstanding, December 31, 2018	39,130	$4.60
Issued	-	-
Repurchased/Retired	(3,260)	-
Forfeited	-	-
Outstanding, December 31, 2019, vested and exercisable	35,870	$4.60	3.9

Total intrinsic value of the outstanding warrants as of December 31, 2019 amounted to $341,000.

NOTE 8. INCOME TAXES

The Company had available federal net operating loss carryforwards of approximately $26.6 million and $28.0 million as of December 31, 2019 and 2018, respectively, to reduce future taxable income. The federal carryforward expires between 2026 through 2037. Given the Company’s history of net operating losses, management has determined that it is more likely than not that the Company will not be able to realize the tax benefit of the carryforwards. Accordingly, the Company has not recognized a deferred tax asset for this benefit.

Due to the restrictions imposed by Internal Revenue Code Section 382 regarding substantial changes in ownership of companies with loss carryforwards, the utilization of the Company’s NOL may be limited to statutory limits as a result of change in stock ownership. NOLs incurred subsequent to the latest change in control are not subject to the limitations.

The Company recognizes tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. As of December 31, 2019 and December 31, 2018, the Company did not have a liability for unrecognized tax benefits.

The Company recognizes, as income tax expense, interest and penalties on uncertain tax provisions. As of December 31, 2019, and 2018, the Company has not accrued interest or penalties related to uncertain tax positions. Tax years 2016 through 2019 remain open to examination by the major taxing jurisdictions to which the Company is subject.

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Upon the attainment of consistent taxable income by the Company, management will assess the likelihood of realizing the tax benefit associated with the use of the carryforwards and will recognize the appropriate deferred tax asset at that time.

During the years ended December 31, 2019 and December 31, 2018, the Company recorded a provision for income tax of $7,000 and $11,000, respectively, pertaining to various state income taxes. Due to the utilization of the Company’s NOL, there was no provision for federal income taxes in either year.

Significant components of the Company’s deferred income tax assets are as follows:

	December 31,
	2019	2018
Net operating loss carryforward	$5,579,000	$7,262,000
Allowances for sales returns, bad debt and inventory	87,000	15,000
Share based compensation	94,000	34,000
Other	202,000	46,000
Total deferred asset	5,962,000	7,357,000
Valuation allowance	(5,962,000)	(7,357,000)

Net deferred tax asset	$-	$-

Reconciliation of the effective income tax rate to the U.S. statutory rate is as follows:

	December 31,
	2019	2018
Federal statutory tax rate	21%	21%
State tax, net of federal benefit	4%	5%
	25%	26%
Effect of change in tax rate	-%	-%
Valuation allowance	(25%)	(26%)
Effective tax rate	-%	-%

NOTE 9. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

We are currently not involved in any litigation except noted above that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of the Company or any of its subsidiaries, threatened against or affecting the Company, our Common Stock, any of our subsidiaries or of the Company’s or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

Lease Commitments

The Company is headquartered in Omaha, Nebraska and maintains a lease at a cost of approximately $8,000 per month, which lease is currently set to expire in May 2024. The Omaha facility is a total of 11,088 square feet inclusive of approximately 6,179 square feet of on-site warehouse space. iSatori currently leases 4,732 square feet of space at 15000 W. 6th Avenue, Suite 400, Golden, Colorado 80401, at a cost of $6,000 per month. The Company subleased its iSatori property as of February 1, 2018 which expires January 31, 2020.

Rent expense for the year ended December 31, 2019 was $84,000, of which $50,000 is included in cost of goods sold and $34,000 is included in operating expense in the accompanying consolidated statement of operations. Rent expense for the year ended December 31, 2018 was $104,000 of which $50,000 was included in cost of goods sold and $54,000 was included in operating expenses.

Minimum annual rental commitments under non-cancelable leases are as follows:

Years ending December 31,	Lease Commitments	Sublease	Amount
2020	$67,000	$(5,000)	$62,000
2021	67,000	-	67,000
2022	67,000	-	67,000
2023	61,000	-	61,000
2024 and thereafter	51,000	-	51,000
Less: Imputed interest/present value discount	(59,000)	-	(59,000)
TOTAL	$254,000	$(5,000)	$249,000

NOTE 10. SUBSEQUENT EVENTS

On March 20, 2020 the Company borrowed $2.5 million under the terms of the Company’s Line of Credit Agreement (the "Line of Credit") with the Lender, the term of which are disclosed under the caption "Management's Discussion and Analysis of Financial Condition and Results of Operations-Liquidity and Capital Resources" in this Annual Report on Form 10-K, and in Note 6 to the Consolidated Financial Statements under the caption “Line of Credit – Mutual of Omaha Bank”. The advance was intended to provide the Company with additional liquidity in anticipation of an expected negative impact on sales to GNC and our other wholesale customers resulting from the COVID-19 outbreak.

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Nevada		20-3464383
(State of Incorporation)		(IRS Employer Identification No.)

Large accelerated filer	☐	Accelerated filer	☐
Non–Accelerated filer	☒	Small reporting company	☒
		Emerging growth company	☐

		PAGE
PART I
ITEM 1.	Business		1
ITEM 1A.	Risk Factors		8
ITEM 1B.	Unresolved Staff Comments		13
ITEM 2.	Properties		13
ITEM 3.	Legal Proceedings		13
ITEM 4.	Mine Safety Disclosures		13

PART II			14
ITEM 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		15
ITEM 6.	Selected Financial Data		15
ITEM 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		15
ITEM 7A.	Quantitative and Qualitative Disclosures About Market Risk		20
ITEM 8.	Consolidated Financial Statements and Supplementary Data		21
ITEM 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		21
ITEM 9A.	Controls and Procedures		21
ITEM 9B.	Other Information		22

PART III
ITEM 10.	Directors, Executive Officers, and Corporate Governance		23
ITEM 11.	Executive Compensation		28
ITEM 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		30
ITEM 13.	Certain Relationships and Related Transactions, and Director Independence		32
ITEM 14.	Principal Accountant Fees and Services		33

PART IV
ITEM 15.	Exhibits and Financial Statement Schedules		35
ITEM 16.	Form 10-K Summary		36

SIGNATURES			37

CERTIFICATIONS
Exhibit 31 – Certification pursuant to Rule 13a-14(a) and 15d-14(a)
Exhibit 32 – Certification pursuant to 18 U.S.C 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

	High	Low
Fiscal Year 2019
First Quarter (January - March 2019)	$5.65	4.00
Second Quarter (April - June 2019)	$10.00	5.40
Third Quarter (July - September 2019)	$11.05	8.50
Fourth Quarter (October - December 2019)	$14.10	9.69

Fiscal Year 2018
First Quarter (January - March 2018)	$3.80	2.30
Second Quarter (April - June 2018)	$3.90	2.50
Third Quarter (July - September 2018)	$4.40	2.70
Fourth Quarter (October - December 2018)	$5.50	2.70

	December 31, 2019	December 31, 2018	Change	%
Revenue	$19,497,000	$17,077,000	$2,420,000	$14%
Cost of goods sold	(11,436,000)	(10,332,000)	(1,104,000)	11%
Gross profit	8,061,000	6,745,000	1,316,000	20%
General and administrative expense	(3,049,000)	(3,333,000)	284,000	-9%
Selling and marketing expense	(2,379,000)	(2,690,000)	311,000	-12%

Depreciation and amortization	(52,000)	(69,000)	17,000	-25%
Total operating expense	(5,480,000)	(6,092,000)	612,000	-10%
Income (Loss) from operations	2,581,000	653,000	1,928,000	295%
Other income (expense)	124,000	(133,000)	257,000	n/m
Provision for income tax	(7,000)	(11,000)	4,000	-36%
Net Income	$2,698,000	$509,000	$2,189,000	430%

	Year Ended December 31,
	2019	2018
	(Unaudited)	(Unaudited)
Net income	$2,698,000	$509,000
Interest expense	47,000	133,000
Provision for income taxes	7,000	11,000
Depreciation and amortization	52,000	69,000
EBITDA	2,804,000	722,000
Non-cash and non-recurring adjustments
Common stock issued for services	71,000	163,000
Fair value of vested options issued for services	111,000	130,000

Adjusted EBITDA	$2,986,000	$1,015,000

Name	Age	Title
Dayton Judd	48	Chair of the Board and Chief Executive Officer
Grant Dawson	51	Director
Lewis Jaffe	63	Director
Todd Ordal	62	Director
Seth Yakatan	49	Director
Susan Kinnaman(1)	52	Chief Financial Officer
Patrick Ryan	41	Chief Retail Officer


Members:		Grant Dawson (Chair)
		Lewis Jaffe
		Todd Ordal

Number of Meetings Held:		The Audit Committee held six meetings during 2019.

Functions:		The Audit Committee assists the Board in fulfilling its legal and fiduciary obligations in matters involving our accounting, auditing, financial reporting, internal control and legal compliance functions by approving the services performed by our independent accountants and reviewing their reports regarding our accounting practices and systems of internal accounting controls. The Audit Committee also oversees the audit efforts of our independent accountants and takes those actions as it deems necessary to satisfy it that the accountants are independent of management.

Independence		The members of the Audit Committee each meet the independence standards established by the NASDAQ Capital Market and the SEC for audit committees. In addition, the Board has determined that Messrs. Dawson, Jaffe and Ordal each satisfy the definition of an “audit committee financial expert” under SEC rules and regulations. These designations do not impose any duties, obligations or liabilities on Messrs. Dawson, Jaffe and Ordal that are greater than those generally imposed on them as members of the Audit Committee and the Board, and their designations as audit committee financial experts does not affect the duties, obligations or liability of any other member of the Audit Committee or the Board.


Members:		Lewis Jaffe (Chair)
		Todd Ordal
		Seth Yakatan

Number of Meetings in Held:		The Nominating and Corporate Governance Committee held no meetings during 2019, electing instead to address committee matters by action taken by the full Board.

Functions:		The Nominating and Corporate Governance Committee is responsible for making recommendations to the Board of Directors regarding director candidates and the size and composition of the Board and its committees. In addition, the Nominating and Corporate Governance Committee is responsible for overseeing our corporate governance guidelines and reporting and making recommendations to the Board concerning corporate governance matters.

Independence		We believe that the composition of our Nominating and Corporate Governance Committee meets the criteria for independence under, and the functioning of our Nominating and Corporate Governance Committee complies with, the applicable requirements of the Sarbanes-Oxley Act of 2002 and current SEC rules and regulations.

Name and Principal Position	Year	Salary and Bonus ($)	Stock Awards ($)	Warrants/ Option Awards ($)(1)	All Other Compensation ($)	Total ($)

Dayton Judd (2)	2019	$323,500	$-	$-	$-	$323,500
Chief Executive Officer and Chair of the Board	2018	$105,400	$172,500	$146,651	$109,496	$534,047

Susan Kinnaman (3)	2019	$123,369	$-	$-	$-	$123,369
Chief Financial Officer	2018	$-	$-	$-	$-	$-

Patrick Ryan	2019	$271,280	$-	$-	$-	$271,280
Chief Retail Officer	2018	$240,032	$15,500	$-	$-	$255,532

(1)	The amounts in this column represent the grant date fair value of stock option awards computed in accordance with FASB guidance, excluding the effect of estimated forfeitures under which the Named Executive Officer has the right to purchase, subject to vesting, shares of the Company’s Common Stock.

(2)	Mr. Judd was appointed as the Company’s Chief Executive Officer on February 18, 2018 and has served as a member of the Company’s Board since 2017.

(3)	No compensation information is provided for Ms. Kinnaman for fiscal 2018 as she was not among the Company’s named executive officers for that year. Ms. Kinnaman was appointed as the Company’s Chief Financial Officer on February 18, 2019.

	Option Awards					Stock Awards
Name	Number of securities underlying unexercised options (#) exercisable	Number of securities underlying unexercised options (#) unexercisable	Equity incentive plan awards: Number of underlying unexercised unearned options (#)	Option Exercise price ($)	Option expiration date	Number of shares or units of stock that have not vested (#)	Market value of shares or units of stock that have not vested ($)


Dayton Judd	47,000	23,500		$2.80	07/31/28	30,000 (1)	$423,000 (1)
Chief Executive Officer and Chair of the Board

Susan Kinnaman	1,000			$23.00	02/23/20
Chief Financial Officer	1,000			$13.90	05/09/21

Patrick Ryan
Chief Retail Officer	3,000			$23.00	02/23/20
	3,000			$13.90	05/09/21

	Fees earned or paid in cash (1)	Stock awards	Option awards (2)	Total
Name	($)	($)	($)	($)

Grant Dawson	$22,500	$7,500	$-	$30,000
Lewis Jaffe	$30,000	$-	$-	$30,000
Todd Ordal	$15,000	$15,000	$-	$30,000
Seth Yakatan	$30,000	$-	$-	$30,000

(1)	Certain board members have elected to receive stock awards in lieu of cash fees earned in respect of their annual retainers for service on the Board and its committees. The stock awards vested immediately upon grant and were not subject to any further service by the directors. The amounts in this column represent the grant date fair value of the restricted stock awards granted during 2018 and are computed in accordance with FASB guidance, excluding the effect of estimated forfeitures.

(2)	Represents the grant date fair value of stock option awards computed in accordance with FASB guidance, excluding the effect of estimated forfeitures under which the director has the right to purchase, subject to vesting, shares of the Company’s Common Stock.

(i)	each of our officers and directors;
(ii)	all officers and directors as a group; and
(iii)	each person known by us to beneficially own five percent or more of the outstanding shares of our Common Stock. Percent ownership is calculated based on 1,059,616 shares of our Common Stock outstanding at March 13, 2020.

Name and Address of Owner(1)	Title of Class	Number of Shares Owned	Percentage of Class (2)

Dayton Judd, Chair and Chief Executive Officer (3)	Common Stock	627,019	53.9%

Grant Dawson, Director	Common Stock	19,107	1.8%

Lewis Jaffe, Director	Common Stock	14,431	1.4%

Todd Ordal, Director	Common Stock	15,557	1.5%

Seth Yakatan, Director	Common Stock	-	*%

Susan Kinnaman, Chief Financial Officer (4)	Common Stock	2,649	*%

Patrick Ryan, Chief Retail Officer (5)	Common Stock	8,105	*%

All Officers and Directors as a group (seven persons)	Common Stock	672,868	59.6%

(2)	* Less than 1%

(3)	Consists of 77,419 shares held by Mr. Judd personally, including in IRA accounts; 47,000 shares issuable to Mr. Judd upon the exercise of stock options at $2.80 per share, exercisable within 60 days of March 13, 2020; 466,730 shares held by Sudbury Holdings, LLC; and 35,870 shares issuable upon the exercise of warrants held by Sudbury Holdings, LLC.

(4)	Includes 1,000 shares issuable upon the exercise of stock options at $13.90 per share, exercisable within 60 days of March 13, 2020.

(5)	Includes 3,000 shares issuable upon the exercise of stock options at $13.90 per share, exercisable within 60 days of March 13, 2020.

Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights	Weighted- average exercise price of outstanding options, warrants and rights	Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in first column)
Equity compensation plans approved by security holders:	149,285	$11.76	100,000

	Year Ended December 31,
	2019		2018
	Weaver	Weinberg	Weinberg
Audit fees(1)	$17,500	$96,076	$78,000
Audit-related fees (2)	$-	$-	$-
Tax fees (3)	$-	$26,225	$29,000
All other fees	$9,750	$3,750	$13,000
Total	$27,250	$126,051	$120,000

(1)	Audit services in 2019 and 2018 consisted of the audit of our annual consolidated financial statements, and other services related to filings and registration statements filed by us and our subsidiaries, and other pertinent matters.
(2)	Audit-related fees consisted of travel costs related to our annual audit.
(3)	For permissible professional services related to income tax return preparation and compliance.

2.1		Agreement and Plan of Merger, by and among the Company, iSatori, Inc., and ISFL Merger Sub, Inc., dated May 18, 2015 (incorporated by reference to Exhibit 2.1 filed with Form 8-K on May 18, 2015).
2.2		Voting and Standstill Agreement dated May 18, 2015 (incorporated by reference to Exhibit 4.1 of Schedule 13D (Commission File No. 005-47773) filed by the Company, Stephen Adelé Enterprises, Inc., Stephen Adelé, RENN Universal Growth Investment Trust, PLC, RENN Global Entrepreneurs Fund, Inc. and Russell Cleveland).
3.1		Articles of Incorporation (incorporated by reference to Exhibit 3.1 filed with Amendment No. 3 to the Company’s Registration Statement on Form SB2 (Commission File No. 333-137170)).
3.2		Amendments to Articles of Incorporation (incorporated by reference to Exhibit 3.2 filed with Amendment No. 3 to the Company’s Registration Statement on Form SB2 (Commission File No. 333-137170)).
3.3		Amended and Restated Bylaws of the Corporation (incorporated by reference to Exhibit 3.1 filed with Form 8-K on January 25, 2018).
3.4		Certificate of Amendment to Articles of Incorporation (incorporated by reference to Exhibit 3.1 filed with Form 8-K on September 13, 2010).
3.5		Certificate of Amendment to Articles of Incorporation to change name to FitLife Brands, Inc. (incorporated by reference to Exhibit 3.1 filed with Form 8-K on October 1, 2013).
3.6		Certificate of Amendment to Articles of Incorporation to effect 1-for-10 reverse split (incorporated by reference to Exhibit 3.1 filed with Form 8-K on October 1, 2013).
3.7		Certificate of Designations of Series A Convertible Preferred Stock (incorporated by reference to Exhibit 4.2 filed with Form 8-K on June 30, 2008).
3.8		Certificate of Designations of Series B Convertible Preferred Stock (incorporated by reference to Exhibit 10.1 filed with Form 8-K on January 23, 2009).
3.9		Certificate of Designations of Series C Convertible Preferred Stock. (incorporated by reference to Exhibit 4.3 filed with Form 10-K on April 15, 2011).
3.10		Certificates of Withdrawal of Series A Convertible Preferred Stock, Series B Convertible Preferred Stock, and Series C Convertible Preferred Stock, dated November 13, 2018 (incorporated by reference to Exhibit 3.1 filed with Form 10-Q on November 14, 2018).
3.11		Certificate of Designations, Preferences and Rights of the Series A Convertible Preferred Stock, dated November 13, 2018 (incorporated by reference to Exhibit 3.2 filed with Form 10-Q on November 14, 2018).
3.12		Certificates of Change, dated April 11, 2019 (incorporated by reference to Exhibit 3.1 filed with Form 8-K filed on April 15, 2019).
4.1		Form of Warrant, dated November 13, 2018 (incorporated by reference to Exhibit 4.1 filed with Form 10-Q on November 14, 2018).
10.1		Asset Purchase Agreement between the Company and NDS Nutritional Products, Inc. (incorporated by reference to Exhibit 10.1 filed with Form 8-K on October 15, 2008).
10.2		Settlement Agreement (incorporated by reference to Exhibit 10.1 filed with Form 8-K on October 6, 2009).
10.3		Secured Promissory Note (incorporated by reference to Exhibit 10.2 filed with Form 8-K on October 6, 2009).
10.4		Second Amendment to Asset Purchase Agreement (incorporated by reference to Exhibit 10.3 filed with Form 8-K on October 6, 2009).
10.5		Amendment No. 1 to Security Agreement (incorporated by reference to Exhibit 10.4 filed with Form 8-K on October 6, 2009).
10.6		Amendment No. 1 to Supply, License and Transition Agreement (incorporated by reference to Exhibit 10.5 filed with Form 8-K on October 6, 2009).
10.7		Assignment of Name (incorporated by reference to Exhibit 10.6 filed with Form 8-K on October 6, 2009).
10.8		Employment Agreement, dated December 31, 2009, between the Company and John Wilson (incorporated by reference to Exhibit 10.14 filed with Form 10-K on April 15, 2011).
10.9		Employment Agreement, dated May 1, 2013, by and between the Company and Michael Abrams (incorporated by reference to Exhibit 10.15 filed with the Form 10-K on March 28, 2014).

10.10		Amendment No. 2 to Employment Agreement, dated July 14, 2014 between the Company and John Wilson (incorporated by reference to Exhibit 10.1 filed with Form 8-K on July 15, 2014).
10.11		Demand Promissory Note (incorporated by reference to Exhibit 10.1 filed with Form 8-K on September 11, 2015).

10.12		Security Agreement by and among the Company, Stephen Adele Enterprises, and Stephen Adele, dated September 11, 2015 (incorporated by reference to Exhibit 10.2 filed with Form 8-K on September 11, 2015).
10.13		Amendment No. 3 to Employment Agreement, dated July 14, 2014 between the Company and John Wilson (incorporated by reference to Exhibit 10.1 filed with Form 8-K on April 26, 2017).
10.14		Amendment No. 1 to Employment Agreement, dated May 1, 2013, by and between the Company and Michael Abrams (incorporated by reference to Exhibit 10.2 filed with Form 8-K on April 26, 2017).
10.15		Loan Modification Agreement, dated August 28, 2017, by and between the Company and U.S. National Bank Association Bank (incorporated by reference to Exhibit 10.1 filed with Form 8-K on August 31, 2017).
10.16		Merchant Agreement by and between NDS Nutrition, Inc., iSatori, Inc., and Compass Bank, d/b/a Commercial Billing Service (incorporated by reference to Exhibit 3.1 filed with Form 8-K on January 25, 2018).
10.17		Continuing Guarantee of FitLife Brands, Inc. (incorporated by reference to Exhibit 3.1 filed with Form 8-K on January 25, 2018).
10.18		Consulting Services Agreement, by and between the Company and Dayton Judd, dated March 13, 2018 (incorporated by reference to Exhibit 10.26 filed with Form 10-K on April 17, 2018).
10.19		Abrams Transition Agreement, dated August 15, 2018 (incorporated by reference to Exhibit 10.1 filed with Form 8-K on September 12, 2018).
10.20		Form of Subscription Agreement, dated November 13, 2018 (incorporated by reference to Exhibit 10.1 filed with Form 10-Q on November 14, 2018).
10.21		Promissory Note issued to Sudbury Capital Fund, LP dated December 26, 2018 (incorporated by reference to Exhibit 10.1 filed with Form 8-K on December 26, 2018).
10.22		Promissory Note issued to Dayton Judd dated December 26, 2018 (incorporated by reference to Exhibit 10.2 filed with Form 8-K on December 26, 2018).
10.23		Employment Agreement, by and between FitLife Brands, Inc. and Patrick Ryan, dated June 13, 2019 (incorporated by reference to Exhibit 10.1 filed with Form 8-K on June 18, 2019).
10.24		2019 Omnibus Incentive Plan (incorporated by reference to Appendix A to the Definitive Proxy Statement on Schedule 14A filed on July 12, 2019).
10.25		Revolving Line of Credit Agreement, dated as of September 24, 2019, between the Company and Mutual of Omaha Bank (incorporated by reference to Exhibit 10.1 filed with Form 8-K on September 26, 2019).
14.1		Code of Ethics (incorporated by reference to Exhibit 14.1 filed with Form 10-K on March 27, 2009).
16.1		Letter from Tarvaran, Askelson & Company, LLP, dated April 25, 2017 (incorporated by reference to Exhibit 16.1 filed with Form 8-K on April 26, 2017).
16.2		Letter from Weinberg & Company, P.A., dated September 17, 2019 (incorporated by reference to Exhibit 16.1 filed with Form 8-K on September 17, 2019).
21		List of Subsidiaries.
31.1		Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act.
31.2		Certification of Principal Financial and Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act.
32.1		Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act.
32.2		Certification of Chief Accounting Officer Pursuant to Section 906 of the Sarbanes-Oxley Act.

Registrant Date: March 30, 2020		FitLife Brands, Inc. By: /s/ Dayton Judd
		Dayton Judd
		Chief Executive Officer (Principal Executive Officer)

Date: March 30, 2020		By: /s/ Susan Kinnaman
		Susan Kinnaman
		Chief Financial Officer (Principal Financial Officer)

Date: March 30, 2020		By: /s/ Dayton Judd
		Dayton Judd
		Chief Executive Officer and Chair of the Board

Date: March 30, 2020		By: /s/ Grant Dawson
		Grant Dawson
		Director

Date: March 30, 2020		By: /s/ Seth Yakatan
		Seth Yakatan
		Director