Fuse Medical, Inc. - Annual Report: 2011 (Form 10-K)

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

þ		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 0-10093

Golf Rounds.com, Inc.

(Exact name of registrant as specified in its charter)

Delaware		59-1224913
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

111 Village Parkway, Building #2, Marietta, Georgia 30067

(Address of principal executive offices) (Zip Code)

770-951-0984

N/A

     Check whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ       No o

     Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes o       No o

     State the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date: As of December 7, 2011, the issuer had 3,567,377 shares of common stock, par value $.01 per share, outstanding.

     State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recent completed second fiscal quarter. As of February 28, 2011, the aggregate market value was $285,390.

     Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o		Accelerated filer o		Non-accelerated filer o		Smaller reporting company þ
				(Do not check if a smaller reporting company)

     Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):

Yes þ       No o

 

 

TABLE OF CONTENTS

PART I			3
Item 1. Description of Business			3
Item 2. Description of Properties			6
Item 3. Legal Proceedings			6
Item 4. Submission of Matters to a Vote of Security Holders			6
PART II			7
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities			7
Item 6. Selected Financial Data			8
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations			8
Item 8. Financial Statements and Supplementary Data			10
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure			11
Item 9A(T). Controls and Procedures			11
Item 9B. Other Information			11
PART III			11
Item 10. Directors, Executive Officers and Corporate Governance			11
Item 11. Executive Compensation			12
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters			13
Item 13. Certain Relationships and Related Transactions, and Director Independence			14
Item 14. Principal Accountant Fees and Services			14
PART IV			15
Item 15. Exhibits, Financial Statement Schedules			15
SIGNATURES			16
EX-31.1: Certification
EX-32.1: Certification
EX-31.1
EX-32.1

PART I

ITEM 1.		DESCRIPTION OF BUSINESS

INTRODUCTION

     Golf Rounds.com, Inc. (the “Company”) was incorporated in 1968 as a Delaware corporation, which is also authorized to conduct business in New Jersey and Georgia. Until the fourth quarter of fiscal 1992, the Company was engaged in the wholesale distribution of aluminum alloys, steel and other specialty metals under the name American Metals Service, Inc. In the fourth quarter of fiscal 1992, the Company liquidated its assets and did not conduct any business operations until May 1999. In May 1999, the Company acquired the assets of PKG Design, Inc., the developer of two (2) sports-related Internet websites: golfrounds.com and skiingusa.com. In connection with the acquisition of these websites, the Company changed its name to Golf Rounds.com, Inc.

     In August 2001, the Company determined to cease operations of its golfrounds.com and skiingusa.com websites since continued maintenance of these websites was not a productive use of the Company’s resources.

     On September 19, 2003, the Company and its wholly owned subsidiary, DPE Acquisition Corp. (formed on September 2, 2003), entered into an agreement and plan of reorganization and merger with Direct Petroleum Exploration, Inc. (“DPE”), which was not consummated. The Company continues to maintain the subsidiary for use in any other potential future acquisition. This subsidiary is currently inactive and has no operations.

OUR BUSINESS PLAN

     Generally

     Our current business plan is to serve as a vehicle for the acquisition of or merger or consolidation with another company (a “target business”). We intend to use our available working capital, capital stock, debt or a combination of these to effect a business combination with a target business which we believe has significant growth potential. The business combination may be with a financially stable, mature company or a company that is in its early stages of development or growth, which could include companies seeking to obtain capital and to improve their financial stability.

     We will not restrict our search to any particular industry. Rather, we may investigate businesses of essentially any kind or nature and participate in any type of business that may, in our management’s opinion, meet our business objectives as described in this report. We emphasize that the description in this report of our business objectives is extremely general and is not meant to restrict the discretion of our management to search for and enter into potential business opportunities. We have not chosen the particular business in which we will engage and have not conducted any market studies with respect to any business or industry for you to evaluate the possible merits or risks of the target business or the particular industry in which we may ultimately operate. To the extent we enter into a business combination with a financially unstable company or an entity in its early stage of development or growth, including entities without established records of sales or earnings, we will become subject to numerous risks inherent in the business and operations of financially unstable and early stage or potential emerging growth companies. In addition, to the extent that we effect a business combination with an entity in an industry characterized by a high level of risk, we will become subject to the currently unascertainable risks of that industry. An extremely high level of risk frequently characterizes certain industries that experience rapid growth. In addition, although we will endeavor to evaluate the risks inherent in a particular industry or target business, we cannot assure you that we will properly ascertain or assess all significant risk factors.

     Sources of target businesses

     We anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including securities broker-dealers, investment bankers, venture capitalists, bankers and other members of the financial community, who may present solicited or unsolicited proposals. Our officers and directors and their affiliates may also bring to our attention target business candidates. While we do not presently anticipate engaging the services of professional firms that specialize in business acquisitions on any formal basis, we may engage such firms in the future, in which event, we may pay a finder’s fee or other compensation for such introductions if they result in consummated transactions. These fees are customarily between 1% and 5% of the size of the overall transaction, based upon a sliding scale of the amount involved.

     Selection of a target business and structuring of a business combination

     Our management will have significant flexibility in identifying and selecting a prospective target business. In evaluating a prospective target business, our management will consider, among other factors, the following:

	•		the financial condition and results of operation of the target;
	•		the growth potential of the target and that of the industry in which the target operates;
	•		the experience and skill of the target’s management and availability of additional personnel;
	•		the capital requirements of the target;
	•		the competitive position of the target;
	•		the stage of development that the target’s products, processes or services are at;
	•		the degree of current or potential market acceptance of the target’s products, processes or services;
	•		proprietary features and the degree of intellectual property or other protection of the target’s products, processes or services;
	•		the regulatory environment of the industry in which the target operates;
	•		the prospective equity interest in, and opportunity for control of, the target; and
	•		the costs associated with effecting the business combination.

     These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular business combination will be based, to the extent relevant, on the above factors as well as other considerations deemed relevant by our management in connection with effecting a business combination consistent with our business objective. In connection with our evaluation of a prospective target business, we anticipate that we will conduct an extensive due diligence review that will encompass, among other things, meetings with incumbent management and inspection of facilities, as well as a review of financial or other information that will be made available to us.

     We will endeavor to structure a business combination so as to achieve the most favorable tax treatment to us, the target business and both companies’ stockholders. We cannot assure you, however, that the Internal Revenue Service or appropriate state tax authority will agree with our tax treatment of the business combination.

     Until we are presented with a specific opportunity for a business combination, we are unable to ascertain with any degree of certainty the time and costs required to select and evaluate a target business and to structure and complete the business combination. We do not have any full-time employee who will be devoting 100% of his or her time to our affairs. Any costs incurred in connection with the identification and evaluation of a prospective target business with which a business combination is not ultimately completed will result in a loss to us and reduce the amount of capital otherwise available to complete a business combination.

     Limited ability to evaluate the target business’ management

     Although we intend to carefully scrutinize the management of a prospective target business before effecting a business combination, we cannot assure you that our assessment of the target’s management will prove to be correct, especially in light of the possible inexperience of our officers and directors in evaluating certain types of businesses. In addition, we cannot assure you that the target’s future management will have the necessary skills, qualifications or abilities to manage a public company. Furthermore, the future role of our officers and directors, if any, in the target business cannot presently be stated with any certainty. While it is possible that one or more of our officers and directors will remain associated in some capacity with us following a business combination, it is

unlikely that any of them will devote their full efforts to our affairs after a business combination. Moreover, we cannot assure you that our officers and directors will have significant experience or knowledge relating to the operations of the particular target business.

     We may seek to recruit additional managers to supplement the incumbent management of the target business. We cannot assure you, however, that we will be able to recruit additional managers who have the requisite skills, knowledge or experience necessary to enhance the incumbent management.

     Investment Company Act

     We may participate in a business or opportunity by purchasing, trading or selling the securities of a business. We do not intend to engage primarily in these activities and we are not registered as an “investment company” under the Investment Company Act of 1940. We do not believe that registration under the act is required based upon our proposed activities. We intend to conduct our activities so as to avoid being classified as an “investment company” and avoid application of the costly and restrictive registration and other provisions of the Investment Company Act and its regulations.

     The Investment Company Act may, however, also be deemed to be applicable to a company that does not intend to be characterized as an “investment company” but that, nevertheless, engages in activities that may be deemed to be within the definitional scope of certain provisions of the Investment Company Act. While we do not believe that our anticipated principal activities will subject us to regulation under the Investment Company Act, we cannot assure you that we will not be deemed to be an “investment company,” especially during the period prior to a business combination. In the event we are deemed to be an “investment company,” we may become subject to certain restrictions relating to our activities and regulatory burdens, including:

	•		restrictions on the nature of our investments; and
	•		the issuance of securities,
	•		registration as an investment company;
	•		adoption of a specific form of corporate structure; and
	•		compliance with certain burdensome reporting, recordkeeping, voting, proxy and disclosure requirements and other rules and regulations.

In the event we are characterized as an “investment company,” we would be required to comply with these additional regulatory burdens, which would require additional expense.

COMPETITION

     We expect to encounter intense competition from other entities having a business objective similar to ours. Many of these entities, including financial consulting companies and venture capital firms, have longer operating histories and have extensive experience in identifying and effecting business combinations, directly or through affiliates. Many of these competitors possess significantly greater financial, technical and other resources than we do. We cannot assure you that we will be able to effectively compete with these entities. In the event we are unable to compete effectively with these entities, we may be forced to evaluate less attractive prospects for a business combination. If we are forced to evaluate these less attractive prospects, we cannot assure you that our stated business objectives will be met.

     If we effect a business combination, we will become subject to competition from competitors of the acquired business. In particular, industries that experience rapid growth frequently attract larger numbers of competitors, including competitors with greater financial, marketing, technical and other resources than we have. We cannot ascertain the level of competition we will face if we effect a business combination and we cannot assure you that we will be able to compete successfully with these competitors.

EMPLOYEES

     Currently, our only employee is our officer, who devotes as much time to our business as our board of directors determines to be necessary. R.D. Garwood, Inc. provides us with the use of an administrative assistant, who performs secretarial and bookkeeping services. (See also Item 2, Description of Properties.)

ITEM 2.		DESCRIPTION OF PROPERTIES

     Our principal executive offices are located at 111 Village Parkway, Building #2, Marietta, Georgia and our telephone number is (770) 951-0984. Our office space, fixtures, furniture and equipment, as well as our administrative assistant, is provided to us by R.D. Garwood, Inc. at a cost of $900 per month on a month-to-month basis. Robert H. Donehew, our president, treasurer and director, is also chief financial officer of R.D. Garwood, Inc. We believe that our present business property is adequate and suitable to meet our needs until we consummate a business combination.

ITEM 3.		LEGAL PROCEEDINGS

     None.

ITEM 4.		SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None.

PART II

ITEM 5.		MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

MARKET INFORMATION

     Our common stock is traded on the OTC Bulletin Board under the symbol “TEEE”. Below is a table indicating the range of high and low bid information for the common stock as reported by the OTC Bulletin Board for the periods listed. Bid prices represent prices between broker-dealers and do not include retail mark-ups and mark-downs or any commission to broker-dealers. In addition, these prices do not necessarily reflect actual transactions.

		HIGH				LOW
PERIOD		($)				($)
Fiscal 2012
First Quarter*			0.08				0.03
Fiscal 2011
First Quarter			0.67				0.06
Second Quarter			0.10				0.05
Third Quarter			0.09				0.06
Fourth Quarter			0.06				0.05
Fiscal 2010
First Quarter			0.42				0.37
Second Quarter			0.45				0.31
Third Quarter			0.37				0.35
Fourth Quarter			0.40				0.32

HOLDERS

     As of December 7, 2011, we believe there were more than 2,000 beneficial holders of our common stock.

DIVIDEND POLICY

     We had not paid any dividends until October 21, 2010, at which time the Company declared a special cash dividend of $0.50 per share payable to stockholders of record as of September 30, 2010. We do not anticipate declaring any additional dividends prior to the consummation of a business combination. The payment of dividends after a business combination will be contingent upon our revenues and earnings, if any, our capital requirements and our general financial condition. The payment of any dividends after a business combination will be within the discretion of our board of directors. We presently intend to retain all earnings, if any, for use in our business operations and, accordingly, we do not anticipate declaring any dividends in the foreseeable future.

RECENT SALES OF UNREGISTERED SECURITIES AND USE OF PROCEEDS FROM SALES OF REGISTERED SECURITIES.

     On September 27, 2010, Robert Donehew, our President and a director of the company, exercised options to purchase an aggregate of 120,000 shares of our common stock for an aggregate exercise price of $39,600.

ITEM 6.		SELECTED FINANCIAL DATA

     None.

ITEM 7.		MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD LOOKING STATEMENTS

     When used in this Report, words or phrases such as “will likely result,” “management expects,” “we expect,” “will continue,” “is anticipated,” “estimated” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on any such forward-looking statements, each of which speak only as of the date made. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical earnings and those presently anticipated or projected. We have no obligation to publicly release the result of any revisions which may be made to any forward-looking statements to reflect anticipated or unanticipated events or circumstances occurring after the date of such statements. Forward-looking statements involve a number of risks and uncertainties including, but not limited to, general economic conditions, our ability to find a suitable company to effect a business combination with, competitive factors and other risk factors as set forth in Exhibit 99.1 included in the 10-K Report for the year ended August 31, 2009 as filed on October 26, 2009.

     The following discussion should be read in conjunction with the financial statements and related notes included in this Report.

Critical Accounting Policies and Use of Estimates

     The preparation of consolidated financial statements requires us to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts and classification of expense, and the disclosure of contingent assets and liabilities. We evaluate our estimates and assumptions on an ongoing basis. We base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The following items in our consolidated financial statements require significant estimates and judgments:

     Accounting for stock options. We believe that it is important for investors to be aware that there is a high degree of subjectivity involved in estimating the fair value of stock-based compensation, that the expenses recorded for stock-based compensation in the Company’s financial statements may differ significantly from the actual value (if any) realized by the recipients of the stock awards, and that the expenses recorded for stock-based compensation will not result in cash payments from the Company.

RESULTS OF OPERATIONS

     We have had no revenues (other than interest and dividend income) since 1992 and will not generate any revenues (other than interest and dividend income) until, at the earliest, the completion of a business combination.

     Fiscal year 2011 compared to fiscal year 2010

     For the year ended August 31, 2011, other income (interest) was $897 as compared to $9,800 for the year ended August 31, 2010. The decrease in interest income for the year ended August 31, 2011, was due to a decrease of $1,878,368 of cash on hand as well as lower rates of interest paid to us on our money market fund investments, which are reported as cash and cash equivalents. The decrease in cash on hand was primarily due to an aggregate dividend paid of $1,783,689,

     General, administrative and other expenses were $123,159 for the year ended August 31, 2011, as compared to $167,262 for the year ended August 31, 2010. The decrease in expenses was due to lower stock-based compensation of $31,200, due diligence expense of $25,576, directors and officers liability insurance expenses of $3,333, taxes and licenses of $2,131, office sharing expenses of $1,800, and dues and subscriptions of $423, offset by higher legal expenses of $7,424, payroll expenses of $6,060, stockholder service expenses of $5,844, business wire expenses of $750, bank charges of $175, and office expenses of $107.

     General, administrative and other expenses for the year ended August 31, 2011, consisted of payroll expenses of $38,413, legal expenses of $24,633, audit and accounting fee expenses of $18,250, stockholder service expenses of $15,240, directors and officers liability insurance expenses of $14,000, office sharing expenses of $9,000, taxes and license expenses of $2,256, business wire expenses of $750, bank charges of $339, dues and subscriptions of $171, and office expenses of $107.

LIQUIDITY AND CAPITAL RESOURCES

     General

     At August 31, 2011, cash and cash equivalents were $53,401, which includes $49,739 invested in various money market accounts with a weighted average effective yield of 0.14% and $3,662 in a non-interest bearing checking account. At August 31, 2011, working capital was $57,393.

     Cash flows used in operating activities for the year ended August 31, 2011 of $134,279 relates to a net loss of $122,262 and a decrease in accounts payable and accrued expenses of $15,767, offset by a decrease in prepaid expenses of $3,750.

     Cash flows used in financing activities for the year ended August 31, 2011 of $1,744,089 relates to dividends paid to stockholders of $1,783,689, offset by proceeds from stock options exercised of $39,600.

Currently, our working capital may not be sufficient to last for more than 12 months. If we acquire a business, our-post acquisition capital needs may be more substantial and our current capital resources may not be sufficient to meet our requirements. We currently believe that if we need capital in the future, we will be able to raise capital through sales of equity and institutional or investor borrowings, although we cannot assure you we will be able to obtain such capital. We anticipate that after any acquisition we may complete in accordance with our business plan, we will use substantially all our then existing working capital to fund the operations of the acquired business. In addition, we believe that any new business operations may require additional capital to fund its operations.

     Contractual obligations

     The Company has no material contractual obligations other than those relating to employment as described in Item 10, “Executive Compensation.”

Our Ability to Continue as a Going Concern

Our financial statements as of August 31, 2011 include an explanatory paragraph describing the existence of conditions that raise substantial doubt about our ability to continue as a going concern. Our consolidated financial statements as of August 31, 2011 have been prepared under the assumption that we will continue as a going concern. If we are not able to continue as a going concern, it is likely that holders of our common stock will lose all of their investment. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.

RECENT ACCOUNTING PRONOUNCEMENTS

In September 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2011-08, “Intangibles — Goodwill and Other,” (“ASU 2011-08”), which amends current guidance to allow a company to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. The amendment also improves previous guidance by expanding upon the examples of events and circumstances that an entity should consider between annual impairment tests in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. ASU 2011-08 is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. Accordingly, the Company will adopt ASU 2011-08 beginning in the second quarter of fiscal year ending August 31, 2012. The Company does not expect the provisions of ASU 2010-13 to have a material effect on the Company’s consolidated results of operations or financial condition.

In June 2011, the FASB issued ASU 2011-05, “Comprehensive Income (Topic 220): Presentation of Comprehensive Income,” (“ASU 2011-05”), which requires entities to present net income and other comprehensive income in either a single continuous statement or in two separate, but consecutive, statements of net income and other comprehensive income. ASU 2011-05 is effective for fiscal years and interim periods beginning after December 15, 2011. Accordingly, the Company will adopt ASU 2011-05 beginning in the second

quarter of fiscal year ending August 31, 2012. The adoption of this updated disclosure guidance is not expected to have a material impact upon the Company’s financial position and results of operations.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index to Financial Statements:

		Page
Report of Independent Registered Public Accounting Firm			F-1
Consolidated Balance Sheets as of August 31, 2011 and 2010			F-2
Consolidated Statements of Operations for the years ended August 31, 2011 and 2010			F-3
Consolidated Statements of Stockholders’ Equity for the years ended August 31, 2011 and 2010			F-4
Consolidated Statements of Cash Flows for the years ended August 31, 2011 and 2010			F-5
Notes to Consolidated Financial Statements for the years ended August 31, 2011 and 2010			F-6 — F-10

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders:
Golf Rounds.com, Inc.

We have audited the accompanying consolidated balance sheets of Golf Rounds.com, Inc. and subsidiary (the “Company”) as of August 31, 2011 and 2010, and the related consolidated statements of operations, stockholders’ equity and cash flows for the years then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, 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. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Golf Rounds.com, Inc. and subsidiary as of August 31, 2011 and 2010, and the results of their operations and their cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company incurred a net loss of $122,262 and a negative cash flow from operations of $134,279 for the year ended August 31, 2011. These matters raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Weinberg & Company, P.A.

Boca Raton, Florida
December 7, 2011

GOLF ROUNDS.COM, INC. AND SUBSIDIARY

		August 31, 2011				August 31, 2010
Assets
Current assets:
Cash and cash equivalents		$	53,401			$	1,931,769
Prepaid expenses			11,917				15,667
Total current assets			65,318				1,947,436
Total assets		$	65,318			$	1,947,436
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable and accrued expenses (including $7,700 and $22,200 due to related parties, respectively)		$	7,925			$	23,692
Total current liabilities			7,925				23,692
Stockholders’ equity:
Common stock, $0.01 par value; 12,000,000 shares authorized, 3,567,377 and 3,447,377 shares issued and outstanding, respectively			35,673				34,473
Additional paid-in capital			3,178,550				4,923,839
Accumulated deficit			(3,156,830	)			(3,034,568	)
Total stockholders’ equity			57,393				1,923,744
Total liabilities and stockholders’ equity		$	65,318			$	1,947,436

See accompanying notes to consolidated financial statements.

GOLF ROUNDS.COM, INC. AND SUBSIDIARY

		For the				For the
		Year Ended				Year Ended
		August 31, 2011				August 31, 2010
Expenses:
General, administrative and other		$	123,159			$	167,262
Total operating expenses			123,159				167,262
Loss from operations			(123,159	)			(167,262	)
Other income:
Interest income			897				9,800
Total other income			897				9,800
Net loss		$	(122,262	)		$	(157,462	)
Net loss per common share — basic and diluted		$	(0.03	)		$	(0.05	)
Weighted average number of common shares outstanding — basic and diluted			3,558,500				3,447,377

See accompanying notes to consolidated financial statements.

GOLF ROUNDS.COM, INC. AND SUBSIDIARY

										Additional								Total
		Common Stock								Paid-In				Accumulated				Stockholders’
		Shares				Amount				Capital				Deficit				Equity
Balance, August 31, 2009			3,447,377			$	34,473			$	4,892,639			$	(2,877,106	)		$	2,050,006
Stock-based compensation			—				—				31,200				—				31,200
Net loss			—				—				—				(157,462	)			(157,462	)
Balance, August 31, 2010			3,447,377				34,473				4,923,839				(3,034,568	)			1,923,744
Cash dividend paid to stockholders			—				—				(1,783,689	)			—				(1,783,689	)
Stock options exercised			120,000				1,200				38,400				—				39,600
Net loss			—				—				—				(122,262	)			(122,262	)
Balance, August 31, 2011			3,567,377			$	35,673			$	3,178,550			$	(3,156,830	)		$	57,393

See accompanying notes to consolidated financial statements.

GOLF ROUNDS.COM, INC. AND SUBSIDIARY

		For the				For the
		Year Ended				Year Ended
		August 31, 2011				August 31, 2010
Cash flows from operating activities:
Net loss		$	(122,262	)		$	(157,462	)
Adjustments to reconcile net loss to net cash used in operating activites:
Stock-based compensation			—				31,200
Changes in operating assets and liabilities:
Decrease in prepaid expenses			3,750				1,333
(Decrease) increase in accounts payable and accrued expenses			(15,767	)			19,862
Net cash used in operating activities			(134,279	)			(105,067	)
Cash flows from financing activities:
Proceeds from stock options exercised			39,600				—
Dividends paid to stockholders			(1,783,689	)			—
Net cash used in financing activities			(1,744,089	)			—
Net decrease in cash and cash equivalents			(1,878,368	)			(105,067	)
Cash and cash equivalents — beginning			1,931,769				2,036,836
Cash and cash equivalents — ending		$	53,401			$	1,931,769

See accompanying notes to consolidated financial statements.

GOLF ROUNDS.COM, INC. AND SUBSIDIARY

NOTE 1 — NATURE OF OPERATIONS

Golf Rounds.com, Inc. (the “Company”) was incorporated in 1968 as a Delaware corporation and is also authorized to conduct business in New Jersey and Georgia. Until the fourth quarter of fiscal 1992, the Company was engaged in the wholesale distribution of aluminum alloys, steel and other specialty metals under the name American Metals Service, Inc. In the fourth quarter of fiscal 1992, the Company liquidated its assets and did not conduct any business operations until May 1999. In May 1999, the Company acquired the assets of PKG Design, Inc., the developer of two (2) sports-related Internet websites: golfrounds.com and skiingusa.com. In connection with the acquisition of these websites, the Company changed its name to Golf Rounds.com, Inc.

In August 2001, the Company determined to cease operations of its golfrounds.com and skiingusa.com websites since continued maintenance of these websites was not a productive use of the Company’s resources.

On September 19, 2003, the Company and its wholly owned subsidiary, DPE Acquisition Corp. (formed on September 2, 2003), entered into an agreement and plan of reorganization and merger with Direct Petroleum Exploration, Inc. (“DPE”), which was not consummated. The Company continues to maintain the subsidiary for use in any other potential future acquisition. This subsidiary is currently inactive and has no operations.

The Company’s current business plan is primarily to serve as a vehicle for the acquisition of or merger or consolidation with another company (a “target business”). The Company intends to use its available working capital, capital stock, debt, or a combination of these to effect a business combination with a target business which management believes has significant growth potential.

NOTE 2 — GOING CONCERN

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. During the year ended August 31, 2011, the Company had a net loss of $122,262, had net cash used in operations of $134,279, and had no revenues from operations. These factors among others indicate that the Company may be unable to continue as a going concern. The Company’s existence is dependent upon management’s ability to effect a business combination with a target business and/or obtain additional funding sources. There can be no assurance that the Company’s financing efforts will result in profitable operations or the resolution of the Company’s liquidity problems. The accompanying financial statements do not include any adjustments that might result should the Company be unable to continue as a going concern.

NOTE 3 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(A) PRINCIPLES OF CONSOLIDATION

The consolidated financial statements include the accounts of Golf Rounds.com, Inc. and its wholly-owned subsidiary DPE Acquisition Corp. All inter-company balances and transactions have been eliminated in consolidation.

(B) USE OF ESTIMATES

Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). These accounting principles require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments and assumptions are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of our consolidated financial statements as well as the reported amounts of revenues and expenses during the periods presented. Our consolidated financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting any available alternative would not produce a materially different result. Significant estimates include valuation of stock-based compensation and the valuation allowance on deferred tax assets.

(C) CASH EQUIVALENTS

The Company considers all money market funds and highly liquid debt instruments with an original maturity of three months or less to be cash equivalents.

GOLF ROUNDS.COM, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED AUGUST 31, 2011 AND 2010

(D) STOCK-BASED COMPENSATION

The Company recognizes compensation expense for stock-based compensation in accordance with ASC Topic No. 718. For employee stock-based awards, the Company calculates the fair value of the award on the date of grant using the Black-Scholes method for stock options; the expense is recognized over the service period for awards expected to vest. For non-employee stock-based awards, the Company calculates the fair value of the award on the date of grant in the same manner as employee awards, however, the awards are revalued at the end of each reporting period and the prorata compensation expense is adjusted accordingly until such time the nonemployee award is fully vested, at which time the total compensation recognized to date shall equal the fair value of the stock-based award as calculated on the measurement date, which is the date at which the award recipient’s performance is complete. The estimation of stock-based awards that will ultimately vest requires judgment, and to the extent actual results or updated estimates differ from original estimates, such amounts are recorded as a cumulative adjustment in the period estimates are revised.

(E) INCOME TAXES

Current income taxes are based on the year’s taxable income for federal and state income tax reporting purposes. Deferred income taxes are provided on a liability basis whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax law and rates on the date of enactment.

(F) LOSS PER SHARE

Net loss per common share is based on the weighted average number of shares of common stock outstanding during each year. Common stock equivalents, including 520,000 and 705,000 stock options for the years ended August 31, 2011 and 2010, respectively, are not considered in diluted loss per share because the effect would be anti-dilutive.

(G) FAIR VALUE MEASUREMENTS

The Company has adopted the provisions of Accounting Standards Codification (“ASC”) Topic 820, “Fair Value Measurements and Disclosures”. ASC Topic 820 provides a framework for measuring fair value and requires expanded disclosures regarding fair value measurements. Fair value is defined as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The accounting standard established a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value. A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

The estimated fair value of certain financial instruments, including cash and cash equivalents, accounts payable and accrued expenses are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments.

(H) RECENT ACCOUNTING PRONOUNCEMENTS

In September 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2011-08, “Intangibles — Goodwill and Other,” (“ASU 2011-08”), which amends current guidance to allow a company to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. The amendment also improves previous guidance by expanding upon the examples of events and circumstances that an entity should consider between annual impairment tests in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. ASU 2011-08 is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. Accordingly, the Company will adopt ASU 2011-08 beginning in the second quarter of fiscal year ending August 31, 2012. The Company does not expect the provisions of ASU 2010-13 to have a material effect on the Company’s consolidated results of operations or financial condition.

GOLF ROUNDS.COM, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED AUGUST 31, 2011 AND 2010

In June 2011, the FASB issued ASU 2011-05, “Comprehensive Income (Topic 220): Presentation of Comprehensive Income,” (“ASU 2011-05”), which requires entities to present net income and other comprehensive income in either a single continuous statement or in two separate, but consecutive, statements of net income and other comprehensive income. ASU 2011-05 is effective for fiscal years and interim periods beginning after December 15, 2011. Accordingly, the Company will adopt ASU 2011-05 beginning in the second quarter of fiscal year ending August 31, 2012. The adoption of this updated disclosure guidance is not expected to have a material impact upon the Company’s financial position and results of operations.

NOTE 4 — INCOME TAXES

The components of the benefit (provision) for income taxes from continuing operations are as follows:

		For the				For the
		Year Ended				Year Ended
		August 31, 2011				August 31, 2010
Current (benefit) provision: federal		$	—			$	—
Current (benefit) provision: state			—				—
Total current provision			—				—
Deferred (benefit) provision: federal			—				—
Deferred (benefit) provision: state			—				—
Total deferred provision			—				—
Total provision (benefit) for income taxes from continuing operations		$	—			$	—

Significant items making up the deferred tax assets and deferred tax liabilities are as follows:

		August 31, 2011				August 31, 2010
Long-term deferred taxes:
Operating loss carryforwards-federal			617,000				580,000
Operating loss carryforwards-state			117,000				109,000
Total deferred taxes			734,000				689,000
Less: valuation allowance			(734,000	)			(689,000	)
Net deferred tax assets		$	—			$	—

A valuation allowance is established if it is more likely than not that all or a portion of the deferred tax asset will not be realized. Accordingly, a valuation allowance was established in 2011 and 2010 for the full amount of the deferred tax asset due to the uncertainty of realization. Management believes that based upon its projection of future taxable operating income for the foreseeable future, it is more likely than not that the Company will not be able to realize the benefit of the deferred tax asset at August 31, 2011. The net change in the valuation allowance during the year ended August 31, 2011 was an increase of $45,000. The valuation allowance as of August 31, 2011 was $734,000.

The amounts and corresponding expiration dates of the Company’s unused net operating loss carryforwards are shown in the following table as of August 31, 2011:

GOLF ROUNDS.COM, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED AUGUST 31, 2011 AND 2010

Year		Federal				Georgia
2011		$	185,000			$	—
2019			43,000				—
2020			389,000				89,000
2021			218,000				129,000
2022			187,000				207,000
2023			157,000				175,000
2024			321,000				340,000
2025			117,000				168,000
2026			72,000				165,000
2027			32,000				141,000
2028			86,000				134,000
2029			124,000				126,000
2030			139,000				139,000
2031			135,000				135,000
		$	2,205,000			$	1,948,000

The Company’s effective income tax (benefit) rate for continuing operations differs from the statutory federal income tax benefit rate as follows:

		For the				For the
		Year Ended				Year Ended
		August 31, 2011				August 31, 2010
Federal tax benefit (provision) rate			28	%			28	%
State tax benefit (provision) rate			4	%			4	%
Temporary differences			3	%			3	%
Permanent differences			0	%			-6	%
Change in valuation allowance			-35	%			-29	%
Effective Income tax (benefit) provision rate from continuing operations			0	%			0	%

In accordance with certain provisions of the Tax Reform Act of 1986 a change in ownership of greater than 50% percent of a corporation within a three-year period will place an annual limitation on the corporation’s ability to utilize its existing tax benefit carryforwards. Such a change in ownership may have occurred in connection with the private placement of securities. Additionally, the Company’s utilization of its tax benefit carryforwards may be restricted in the event of possible future changes in the ownership of the Company from the exercise of options or other future issuances of common stock.

NOTE 5 — RELATED PARTY TRANSACTIONS

On March 1, 2000, the Company executed a month-to-month agreement to sub-lease office space and share office equipment and a bookkeeper’s time for $900 a month from R. D. Garwood, Inc. (“Garwood”). The Company’s President/treasurer/secretary is the chief financial officer of Garwood. During the year ended August 31, 2011, the Company was given two months of free rent. The Company’s expense for these shared facilities and bookkeeping services was $9,000 and $10,800 for the years ended August 31, 2011 and 2010, respectively.

As of August 31, 2011, accounts payable and accrued expenses includes $2,700 for rent and $5,000 for officer’s salary. As of August 31, 2010, accounts payable and accrued expenses includes $22,200 for consulting services for due diligence rendered by a company wholly-owned by the Company’s President.

NOTE 6 — STOCKHOLDERS’ EQUITY

(A) STOCKHOLDER DIVIDEND

On September 17, 2010, the Company declared a special cash dividend of $0.50 per share of common stock issued and outstanding to be paid on October 21, 2010 to stockholders of record as of September 30, 2010 using cash from its general funds. On October 21,

GOLF ROUNDS.COM, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED AUGUST 31, 2011 AND 2010

2010, the aggregate dividend paid was $1,783,689. The Company expects that for tax purposes this dividend will be treated as a return of capital to stockholders. Distributions that qualify as a return of capital are not “dividends” for tax purposes.

(B) STOCK OPTIONS

On July 10, 2010, the Board of Directors awarded to the Company’s president/treasurer/secretary, for compensation for additional work performed during fiscal 2009 and 2010 on behalf of the Company, options to purchase 120,000 shares of the Company’s common stock. These options were exercisable immediately or at any time during the ten-year period commencing on the grant date of July 10, 2010 at an exercise price of $0.33 per share. Accordingly, compensation cost of $31,200 was recognized during the year ended August 31, 2010. On September 27, 2010, the 120,000 stock options were exercised and the Company received $39,600.

The Company estimates the fair value of stock-based compensation utilizing the Black-Scholes option pricing model, which is dependent upon several variables such as the expected option term, expected volatility of our stock price over the expected term, expected risk-free interest rate over the expected option term, expected dividend yield rate over the expected option term, and an estimate of expected forfeiture rates. The Company believes this valuation methodology is appropriate for estimating the fair value of stock options granted to employees and directors which are subject to ASC Topic 718 requirements. These amounts are estimates and thus may not be reflective of actual future results, nor amounts ultimately realized by recipients of these grants. The Company recognizes compensation on a straight-line basis over the requisite service period for each award. The following table summarizes the assumptions the Company utilized to record compensation expense for stock options granted during the years ended August 31, 2011 and 2010:

		For the				For the
		Year Ended				Year Ended
Assumptions		August 31, 2011				August 31, 2010
Expected volatility			N/A				71.1	%
Expected life (years)			N/A				10.0
Risk-free interest rate			N/A				3.07	%
Dividend yield			N/A				0.0	%

A summary of the Company’s stock option activity during the year ended August 31, 2011 is presented below:

										Weighted
						Weighted				Average
						Average				Remaining				Aggregate
		No. of				Exercise				Contractual				Intrinsic
		Shares				Price				Term				Value
Balance outstanding at September 1, 2010			705,000			$	0.65
Granted			—
Exercised			(120,000	)		$	0.33
Forfeited			—
Expired			(65,000	)		$	1.30
Balance outstanding at August 31, 2011			520,000			$	0.65				2.8			$	—
Exercisable at August 31, 2011			520,000			$	0.65				2.8			$	—

The weighted-average grant-date fair value of options granted during the year ended August 31, 2010 was $0.26.

ITEM 9.		CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

     Not applicable.

ITEM 9A(T).		CONTROLS AND PROCEDURES

Pursuant to Rules adopted by the Securities and Exchange Commission the Company carried out an evaluation of the effectiveness of the design and operation of its disclosure controls and procedures pursuant to Exchange Act Rules. This evaluation was done as of the end of the fiscal year under the supervision and with the participation of the Company’s principal executive officer (who is also the principal financial officer). There have been no significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of the evaluation. Based upon that evaluation, he believes that the Company’s disclosure controls and procedures are effective in gathering, analyzing and disclosing information needed to ensure that the information required to be disclosed by the Company in its periodic reports is recorded, summarized and processed timely. The principal executive officer is directly involved in the day-to-day operations of the Company.

Changes in Internal Control Over Financial Reporting

     There have been no changes in the Company’s internal controls over financial reporting during its fourth fiscal quarter that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting.

ITEM 9B.		OTHER INFORMATION

     There is no information required to be filed on a Form 8-K during the fourth quarter of the fiscal year covered by this Form 10-K.

PART III

ITEM 10.		DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Our current directors and officers are as set forth in the table below.

Name		Age				Position
Robert H. Donehew			59			President, Treasurer, Secretary and Director*

     ROBERT H. DONEHEW has served as director, president and treasurer since November 2000 and as director, vice president and treasurer from February 2000 until October 31, 2000. He has served as our secretary since December 2005. Since May 2008, Mr. Donehew has been the Chief Financial Officer and a member of the Board of Directors of EndogenX, Inc., a specialty pharmaceutical company. Since July 1996, Mr. Donehew has been the chief executive officer of Donehew Capital, LLC, the general partner of Donehew Fund Limited Partnership, a private investment partnership specializing in the securities market. Since 1983, he has also served as chief financial officer of R.D. Garwood, Inc. and Dogwood Publishing Company Inc. From 1976 through 1983, Mr. Donehew had his own tax and financial planning practice.

     Audit Committee

     Our entire board serves as our audit committee. We do not currently have a “financial expert,” as such term is defined under the securities law, on the committee, but we are in the process of seeking an additional director who will also serve as the financial expert. Previously, the board of directors did not believe it was necessary to have a financial expert on the Committee given our lack of commercial operations and limited financial activities.

     Section 16(A) Beneficial Ownership Reporting Compliance Section 16(a) of the Exchange Act requires our officers, directors and persons who beneficially own more than ten percent of our common stock (“ten percent stockholders”) to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Officers, directors and ten-percent stockholders also are

required to furnish us with copies of all Section 16(a) forms they file. Based solely on our review of the copies of such forms furnished to us, and written representations that no other reports were required, we believe that during the fiscal year ended August 31, 2011, all of our officers, directors and ten-percent stockholders complied with the Section 16(a) reporting requirements.

     Code of Ethics

     We have adopted a code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions, as well as other employees and our directors and meets the requirements of the SEC. A copy of our Code of Ethics was previously filed as an exhibit to our Annual Report on Form 10-KSB for the fiscal year ended 2004. We intend to disclose any amendments to any waivers from a provision of our Code of Ethics on a Form 8-K filed with the SEC.

ITEM 11.		EXECUTIVE COMPENSATION

The following table sets forth the compensation for the three years ended August 31, 2011 for our president (and principal executive and accounting officer). No executive officer’s compensation exceeded $100,000 (or would have exceeded $100,000 if employed for the full year) for the year ended August 31, 2011.

SUMMARY COMPENSATION TABLE

														Long-Term
														Compensation
						Annual Compensation(1)								Number of				All Other
Name and Principal Position		Year				Salary				Bonus				Options				Compensation
Robert H. Donehew			2011			$	34,108			$	0				0			$	0
President and Principal			2010			$	30,000			$	0				120,000			$	0
Accounting Officer			2009			$	30,000			$	0				0			$	0

Option Grants

     The following table represents the stock options granted in the fiscal year ended August 31, 2011 to such executive officers.

OPTION GRANTED IN THE LAST FISCAL YEAR

Number of

Percent of Total

Securities

Options Granted to

Market Price

Underlying Options

Employees in Fiscal

Exercise Price of

on Date

Expiration

Name of Executive

Granted

Year

Options

of Grant

Date

Robert H. Donehew

0

100

%

N/A

N/A

N/A

     The following table sets forth the fiscal year end option values of outstanding options at August 31, 2011 and the dollar value of unexercised, in-the-money options for our executive officers identified in the Summary Compensation table above.

AGGREGATED FISCAL YEAR-END OPTION VALUES

Name		Exercisable				Unexercisable				Exercisable (1)				Unexercisable(1)
Robert H. Donehew			265,000				0			$	0			$	0

Employment Arrangements

     In fiscal year 2010, we issued to Mr. Donehew ten-year options to purchase 120,000 shares at an exercise price of $0.33 per share and vested immediately to compensate him for additional services rendered to the Company during fiscal 2009 and 2010. On September 27, 2010, the 120,000 stock options were exercised and the Company received $39,600.

     Compensation Arrangements for Directors

     Our director does not currently receive any cash compensation for his services.

     In August 2010, we granted to our sole director ten-year options to purchase 120,000 shares of our common stock. All of these options were exercisable at an exercise price of $0.33 per share and vested immediately. On September 27, 2010, the 120,000 stock options were exercised and the Company received $39,600.

ITEM 12.		SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

     The table and accompanying footnotes set forth certain information as of December 7, 2011, with respect to the ownership of our common shares by: to each person or group who beneficially owns more than 5% of our common shares;

	•		each of our directors;
	•		each of our named executive officers; and
	•		all of our directors and executive officers as a group.

A person is deemed to be the beneficial owner of securities that can be acquired by the person within 60 days from the record date upon the exercise of warrants or options. Accordingly, common shares issuable upon exercise of options and warrants that are currently exercisable or exercisable within 60 days of November 23, 2010 have been included in the table with respect to the beneficial ownership of the person owning the options or warrants, but not with respect to any other persons.

		Amount and Nature of
		Beneficial
Name and Address of Beneficial Owner		Ownership				Percent of Class
Paul O. Koether			484,690	(1)			13.6	%
211 Pennbrook Road Far Hills, New Jersey 07931
Robert H. Donehew			520,000	(2)			13.6	%
Donehew Capital, LLC 111 Village Parkway, Building #2 Marietta, Georgia 30067
Shamrock Associates			409,470	(3)			11.5	%
211 Pennbrook Road Far Hills, New Jersey 07931
Ronald I. Heller			325,980	(4)			9.1	%
74 Farview Road Tenafly, New Jersey 07670

		Amount and Nature of
		Beneficial
Name and Address of Beneficial Owner		Ownership				Percent of Class
John W. Galuchie, Jr.			212,166	(5)			5.9	%
376 Main Street Bedminster, New Jersey 07921
Asset Value Holdings, Inc.			200,000				5.6	%
211 Pennbrook Road Far Hills, New Jersey 07931
Galt Asset Management			200,000				5.6	%
c/o Brian Vitale 125 West Shore Road Huntington, New York 11743
All directors and executive officers as a group (one person)		520,000 (6)					13.6	%

ITEM 13.		CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

     See Note 5 to the consolidated financial statements contained in this report.

ITEM 14.		PRINCIPAL ACCOUNTANT FEES AND SERVICES

		2011				2010
Audit Fees(1)		$	18,250			$	18,250
Tax Fees			0				0
Total		$	18,250			$	18,250

PART IV

ITEM 15.		EXHIBITS, FINANCIAL STATEMENTS SCHEDULES

	(a)		Exhibits Filed.
			See Exhibit Index appearing later in this Report.
	(b)		Reports on Form 8-K.
			Not applicable.

SIGNATURES

     In accordance with Section 13 or 15(d) of the Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

     In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dated indicated.

/s/ Robert H. Donehew		President, Treasurer, Secretary and Director
Robert H. Donehew		(Principal Executive and Principal Accounting and Financial Officer)

EXHIBIT INDEX

				Incorporated By
Exhibit				Reference from		No. in
Number		Description		Document		Document
1.1		Agreement and Plan of Merger between American Metals, Inc. and American Metals Service, Inc.		A			2
3.1		Certificate of Incorporation		A			3	(I)
3.1.1		Bylaws		A		3		(II)
10.1		Stock Purchase Agreement, dated January 18, 2000, among Asset Value Holdings, Inc., Bradford Trading Company, Paul Koether, Shamrock Associates, Sun Equities Corporation, Thomas K. Van Herwarde, The Rachel Beth Heller1997 Trust Dated 7/9/97, The Evan Todd Heller Trust Dated 6/17/97, Martan & Co., Donehew Fund Limited Partnership, Jonathan & Nancy Glaser Family Trust Dated 12/16/98, W. Robert Ramsdell and Nagelberg Family Trust Dated 9/24/97		B			2.1
10.2		Form of option agreement for executives and directors		C			10.6
10.4		Code of Ethics		D			10.16
31.1		Section 302 Certification		Filed herewith			—
32.1		Section 906 Certification		Filed herewith			—