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FitLife Brands Adopts Rights Plan to Protect its NOL Assests

/EIN News/ -- Omaha, March 04, 2021 (GLOBE NEWSWIRE) -- FitLife Brands Adopts Rights Plan to Protect its NOL Assets

OMAHA, NE – March 4, 2021 -- FitLife Brands, Inc. (“FitLife” or the “Company”) (OTC Pink: FTLF), a provider of innovative and proprietary nutritional supplements for health-conscious consumers marketed under the brand names NDS Nutrition™, PMD®, SirenLabs®, CoreActive®, Metis Nutrition™, iSatori™, Energize, and BioGenetic Laboratories, today announced that its Board of Directors adopted a tax benefit preservation plan (“Rights Plan”) designed to protect the availability of the Company’s net operating loss carryforwards (“NOLs”) under the US Internal Revenue Code (the “Code”).

As of December 31, 2019, FitLife had approximately $26.6 million of US federal tax NOLs, which may be used to offset future taxable income.  However, if the Company were to experience an ownership change as defined in Section 382 of the Code, its ability to utilize the NOLs would be substantially limited.  The Rights Plan is intended to deter any person (or any persons acting as a group) from acquiring beneficial ownership of more than 4.99% of FitLife’s outstanding common stock, and any person (or any persons acting as a group) that already own more than 5% of the outstanding common shares from increasing its ownership stake.

The Rights Plan is similar to those adopted by numerous other public companies with significant NOLs.  The Rights Plan is not designed to prevent any action that the Board of Directors determines to be in the best interest of the Company and its shareholders and will help to ensure that the Board of Directors remains in the best position to discharge its fiduciary duties.

Under the Rights Plan, the rights will initially trade with the Company’s common stock and will generally become exercisable only if a person (or any persons acting as a group) acquires 4.99% or more of the Company's outstanding common stock.  If the rights become exercisable, all holders of rights (other than any triggering person) will be entitled to acquire shares of common stock at a discount or the Company may exchange each right held by such holders for one share of common stock.

Under the Rights Plan, any person which currently owns 4.99% or more of the Company's common stock may continue to own its shares of common stock but may not acquire any additional shares without triggering the Rights Plan.  The Company's Board of Directors has the discretion to exempt any person or group from the provisions of the Rights Plan.  Unless terminated early or extended by the Board of Directors, the Rights Plan will terminate on March 1, 2022.

The full details of the Rights Plan are available on the Form 8-K filed by the Company with the Securities and Exchange Commission on March 4, 2021.

About FitLife Brands
FitLife Brands is a developer and marketer of innovative and proprietary nutritional supplements for health-conscious consumers.  FitLife markets over 80 different dietary supplements to promote sports nutrition, improved performance, weight loss and general health primarily through domestic and international GNC® franchise locations as well as through more than 25,000 additional domestic retail locations and, increasingly, online.  FitLife is headquartered in Omaha, Nebraska.  For more information please visit our website at www.fitlifebrands.com.

Forward-Looking Statements
This news release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.  Forward-looking statements are statements other than statements of historical fact.  They include statements regarding the operation or effects of the Section 382 Rights Plan and to the use of NOLs to offset future taxable income.  Although we believe the expectations and forecasts reflected in the forward-looking statements are reasonable, we can give no assurance they will prove to have been correct.  They can be affected by inaccurate or changed assumptions or by known or unknown risks, factors and uncertainties.  Such factors may include, but are not limited to, the ability to of the Company to continue to grow revenue, and the Company's ability to continue to achieve positive cash flow given the Company's existing and anticipated operating and other costs.  Many of these risks and uncertainties are beyond the Company's control.  Reference is made to the discussion of risk factors detailed in the Company's filings with the Securities and Exchange Commission including its reports on Form 10-K and 10-Q.  Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made.  FitLife undertakes no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.


Dayton Judd
                    djudd@fitlifebrands.com

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