On September 19, 2003, the Company and its wholly owned subsidiary, DPE Acquisition Corp. (formed on September 2, 2003),December 18, 2013, Golf Rounds entered into an agreementAgreement and planPlan of reorganization and mergerMerger 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.

On May 28, 2014, as a result of the Merger, Golf Rounds acquired Fuse and the equity ownersbusiness of PharmHouse being issued approximately 90%Fuse became our business. For more information on the Merger, see the Company’s Form 8-K/A filed on August 29, 2014.

Fuse was formed in Delaware on July 18, 2012 to market, distribute and sell internal fixation, durable bone materials, biologics, tissues, surgical and other related surgical products for use in a variety of surgical procedures. Subsequent to the formation of Fuse, two physician partnerships were formed to operate separate businesses focusing on the distribution of medical devices. Fuse Medical V, LP, was formed on November 15, 2012 and is owned 59% by Fuse, 1% by Fuse Management V, LLC (the General Partner) and 40% by individual physicians. The second partnership, Fuse Medical VI, LP was formed on January 31, 2013. Fuse Medical VI, LP was owned 59% by Fuse, 1% by Fuse Management VI, LLC (the General Partner) and 40% by individual physicians. Fuse Medical V, LP and Fuse Medical VI, LP are limited partnerships. Prior to the Merger, the General Partners in Fuse Medical V, LP and Fuse Medical VI, LP agreed to surrender their interests and the individual physicians that owned limited partnership interests in Fuse Medical V, LP and Fuse Medical VI, LP agreed to exchange their interests to corresponding interests in Fuse, each becoming one of the common stockHolders. Accordingly, the above companies became wholly-owned subsidiaries of Fuse immediately prior to the Merger. Certificates of Termination were filed for Fuse Medical V, LP, Fuse Medical VI, LP, Fuse Management V, LLC, and Fuse Management VI, LLC on February 12, 2015. A Certificate of Cancellation for Fuse Medical, LLC, was filed on February 20, 2015.

Overview

The Company’s business is to market, distribute and sell internal fixation, durable bone materials, biologics, tissues, surgical and other related surgical products for use in a variety of surgical procedures in various types of facilities (ambulatory surgical centers, hospitals and physician offices and other medical facilities) where surgeons and doctors treat patients and operate. The Company markets, distributes and sells a variety of existing FDA-approved and/or state licensed products and services manufactured or produced by other organizations where the Company is considered a distributor and/or a stocking distributor. Currently, these products consist of plates and screws for recurring bone fractures, allografts for bone chips and tendons, and amniotics. The amniotic products are derived from the inner layer of the human amniotic tissue and then processed by the manufacturer which results in an FDA-approved allograft. Amniotics has historically made up over half of the Company’s revenues. The Company utilizes its physician relationships, corporate partners, facility relationships and partnerships, as well as its knowledge of the healthcare industry, to further its business objectives. All sales are made in compliance with both the Stark Law and the federal anti-kickback statute, as further discussed below. In doing so, the Company’s overall goal is to add value to the healthcare industry by bringing down the overall cost of internal fixation, biologics, bone materials, tissues, surgical implants and other products in the industry.

Product Distribution Channels and Customer Base

The Company utilizes multiple distribution models including representative networks and independent contractors. The Company’s customers are physicians, orthopedic surgeons, hospitals, surgical facilities and physician practices. The Company distributes the products on an after issued basis. On October 11, 2013,behalf of manufacturers and, in some cases, receives a commission related to sales numbers. In most cases, the Company deliveredpurchases products directly from manufactures and resells the products from existing inventory. The Company’s distribution model also utilizes its physician investment partners as part of the network. Beginning with the inclusion of Dr. Pratt and Dr. Dei on the Company management team and others of similar reputations who are investors in the Company, the Company is building a letter to PharmHouse notifying PharmHousenationwide network of specialists in select clinical specialties, many of whom are leaders in their field, that the agreementCompany hopes will clinically utilize the Company’s product lines through appropriate channels in a manner consistent with professional standards of practice. These network specialists include heads of teaching hospitals, universities and clinical resident and fellowship programs at some of the most respected institutes in the nation.

For products sold on a commission basis, the Company receives payment from the manufacturer or distributor. For products sold from the Company’s inventory, the Company receives payment directly from its customers. Currently, the Company has a limited number of customers that it sells products to. In the year ended December 31, 2014, the Company had expired on its stated termination datea concentration of August 30, 2013sales in a limited number of hospital and surgical facilities. Amniotics has historically made up the largest portion of the Company’s business. The Company recognizes that the diversification and growth of its customer base is instrumental to its long-term strategic and financial success. The Company has a diverse line of products and services and intends to grow both the number of customers and product sales through its product distribution channel strategy.

Our principal supplier is Texas AmBioMed, LLC (“AmBioMed”). Fuse entered into a Distributor Agreement with AmBioMed on August 2, 2012, pursuant to which Fuse acts as a non-exclusive global distributor of the following allograft products: AmnioFix® Spine Products, AmnioFix® Nerve Wrap, EpiFix® for wound care, AmBioChoice and AmbioChoice Plus. The term of the agreement would not be extended. Upon expirationwas for an initial one year term and renews on each August 2nd anniversary date for successive one-year terms unless it is terminated in writing by either party. Fuse is required to purchase at least 10 units of AmBioMed product during each six month period of the agreement, which results in a minimum commitment of $2,640 every six months.

On August 20, 2012, Fuse entered into a Commission Agreement with Gulf Coast Surgical Solutions, LLC in which Fuse receives a 25% commission of all of its sales of ETEX Bone Graft products, subject to certain adjustments set forth in the agreement. The Commission Agreement expires at midnight on August 10, 2015, unless terminated by either party with 60 days prior written notice.

On July 17, 2014, the Company entered into an Independent Representative Agreement with Vilex, Inc. (“Vilex”) pursuant to which the Company was appointed as a representative of Vilex to promote and sell Vilex’s products in the United States. The Vilex products include certain plates, screws, and related equipment. Under the terms of the agreement with PharmHouse,Vilex, the Company determinedis a non-exclusive representative of Vilex, except for certain specified customers. The term of the agreement with Vilex is five years, and will automatically renew for additional one-year periods at the expiration of the original term unless terminated as provided therein. The Company will be paid a commission based on its net sales.

On January 8, 2015, the Company entered into a Distribution and Supply Agreement with BioDlogics, LLC (“BioD”), pursuant to actively pursue alternative business combination opportunitieswhich the Company was appointed as a non-exclusive distributor of certain products of BioD and granted the right to promote and sell such products in the near term. 

Competition

For most of the products the Company offers there are a combinationnumber of these to effect a business combination with a target businessintegrated competitors, several of which we believe has significant growth potential. The business combination may be with a financially stable, mature company or a companyare publically traded, that is in its early stages of development or growth, which could include companies seeking to obtain capitalnot only manufacture and to improveproduce their financial stability.

Intellectual Property

At this time the Company holds no intellectual property, patents or trademarks.

Regulatory Issues

There are both federal and state regulations that may impact the Company’s ability to fully implement its strategic plan.

FDA Regulations

The manufacturers and suppliers of the products we market are subject to extensive regulation by the U.S. Food and Drug Administrations (“FDA”), other federal governmental agencies and by state authorities. These regulations govern the approval, clearance or license to commercialize medical devices, biological products and human cellular and tissue products; including compliance with the standards and requirements related to the design, testing, manufacture, labeling, promotion and sales of the products, stringent record keeping requirements, tracking of devices, reporting of potential product defects and adverse events, conduct of corrections and recalls, and other matters. As a distributor and marketer of such FDA-regulated products, we are subject to independent requirements to register and list certain products, we may be required to obtain state licensure or certifications and we may be subject to inspections, in addition to complying with derivative requirements applicable to the manufacturers of the products we market. Failure to comply with applicable requirements could result in a wide variety of enforcement actions ranging from warning letters to more severe sanctions such as: fines and civil penalties, operating restrictions, injunctions and criminal prosecutions.

Affordable Care Act

Pursuant to the Physician Payment Sunshine Act (“Sunshine Act”) enacted as part of the Affordable Care Act, we are required to report annually to the Centers for Medicare & Medicaid Services (“CMS”) beginning in 2014 certain payments and other transfers of value furnished to physicians and teaching hospitals, as well as certain ownership or investments held by physicians or their family members. These annual reports will be publicly available. Failure to report timely, accurately, and completely may subject us to civil monetary penalties. Some states have laws similar to the federal Sunshine Act.

Fraud, Abuse and False Claims

We are directly and indirectly subject to certain federal and state laws governing relationships with healthcare providers and pertaining to healthcare fraud and abuse. The federal Anti-Kickback Statute (the “AKS”) is a criminal statute that prohibits the payment or receipt of remuneration, in cash or otherwise, in return for referrals of federal healthcare beneficiaries. The CMS has promulgated certain safe harbors that offer protection from liability for arrangements that fall within very specific parameters. The Company intends to utilize the “physician investment interest safe harbor” in the AKS as a business model. To reach the “public company exception” (as defined below) to the AKS, the Company must possess undepreciated net tangible assets related to the furnishing of healthcare items and services of more than $50,000,000 in the previous fiscal year or 12-month period.

The Stark Law prohibits physicians or their immediate family members from referring to entities that provide designated health services (“DHS”) to federal program beneficiaries if the physician or an immediate family member has a financial relationship (either via a compensation arrangement or ownership interest) directly or indirectly in that entity. Similar to safe harbors for the AKS, the Stark Law regulations created a series of exceptions to provide protection for certain types of business arrangements that fall within their parameters. Many states have laws similar to the federal law.

In order to meet its objectives in compliance with the Stark Law, the Company will rely on the exception for publicly traded securities (the “Public Company Exception”). This exception effectively permits physicians to own investment securities that may be purchased on terms generally available to the public and which are securities (i) in a corporation that had, at the end of the corporation’s most recent fiscal year, or on average during the previous three fiscal years, stockholder equity exceeding $75,000,000 and (ii) listed on the New York Stock Exchange, the American Stock Exchange, or any regional exchange in which quotations are published on a daily basis, or foreign securities listed on a recognized foreign, national, or regional exchange in which quotations are published on a daily basis, or traded under an automated interdealer quotation system operated by the National Association of Securities Dealers.

The Company will not accept federal reimbursement for its products until the Public Company Exception under the Stark Law is available to it. In addition there are various state statutes which may limit the Company’s ability to fully implement our business model until such time as the Company achieves Public Company Exception status. It is the intent of the Company to not sell any product to an insured that would be reimbursed under any government payer system including, but not limited to, Medicare, Tricare or other national or state government beneficiary program.

Employees

Currently, the Company has 10 employees and 4 independent contractors.

ITEM 1A. RISK FACTORS.

Our business and an investment in our management’s opinion,securities are subject to a variety of risks. The following risk factors describe some of the most significant events, facts or circumstances that could have a material adverse effect upon our business, financial condition, results of operations, ability to implement our business plan and the market price for our securities. Many of these events are outside of our control. If any of these risks actually occur, our business, financial condition or results of operations may be materially adversely affected. In such case, the trading price of our common stock could decline and investors in our common stock could lose all or part of their investment.

We are not currently profitable and we will need to raise additional funds in the future; however, additional funds may not be available on acceptable terms, or at all.

We have substantial operating expenses associated with the sales and marketing of the products we sell. The sales and marketing expenses are anticipated to be funded from operating cash flow. There can be no assurance that we will have sufficient access to liquidity or cash flow to meet our operating expenses and other obligations. If we do not increase our revenue or reduce our expenses, we will need to raise additional capital, which would result in dilution to our stockholders, or seek additional loans. The incurrence of indebtedness would result in increased debt service obligations and could require us to agree to operating and financial covenants that would restrict our operations. Financing may not be available in amounts or on terms acceptable to us, if at all. Any failure by us to raise additional funds on terms favorable to us, or at all, could result in our inability to pay our expenses as they come due, limit our ability to expand our business objectives as describedoperations, and harm our overall business prospects.

We may not be able to raise capital or, if we can, it may not be on favorable terms. We may seek to raise additional capital through public or private equity financings, partnerships, joint ventures, dispositions of assets, debt financings or restructurings, bank borrowings or other sources. To obtain additional funding, we may need to enter into arrangements that require us to relinquish rights to certain technologies, products and/or potential markets. If adequate funds are not otherwise available, we would be forced to curtail operations significantly, including reducing our sales and marketing expenses which could negatively impact product sales and we could even be forced to cease operations, liquidate our assets and possibly even seek bankruptcy protection.

Pricing pressure and cost containment measurescould have a negative impact on our future operating results.

Pricing pressure has increased in our industry due to continued consolidation among healthcare providers, trends toward managed care, the shift towards government becoming the primary payer of healthcare expenses, and government laws and regulations relating to reimbursement and pricing generally. Pricing pressure, reductions in reimbursement levels or coverage or other cost containment measures could unfavorably affect our future operating results and financial condition.

Product pricing (and, therefore, profitability) is subject to regulatory control.

The pricing and profitability of the products we sell may become subject to control by third-party payors. The continuing efforts of governmental and other third-party payors to contain or reduce the cost of healthcare through various means may adversely affect our ability to successfully commercialize our products. In most foreign markets, the pricing and/or profitability of certain diagnostics and prescription pharmaceuticals are subject to governmental control. In the United States, we expect that there will continue to be federal and state proposals to implement similar governmental control though it is unclear which proposals will ultimately become law, if any. Changes in prices, including any mandated pricing, could impact our revenue and financial performance.

Future regulatory action remains uncertain.

We operate in a highly regulated environment, and any legal or regulatory action could be time-consuming and costly. If we, or the manufacturers or distributors that supply us products, fail to comply with all applicable laws, standards and regulations, action by the FDA or other regulatory agencies could result in significant restrictions, including restrictions on the marketing or use of the products we sell or the withdrawal of the products we sell from the market. Any such restrictions or withdrawals could materially affect our business and operations.

Many competitive products exist and more will be developed, and we may not be able to successfully compete because we are smaller and have fewer financial resources.

Our business is in a very competitive and evolving field. Rapid new developments in this report. We emphasizefield have occurred over the past few years, and are expected to continue to occur. Other companies already have competing products available or may develop products to compete with ours. Many of these products have short regulatory timeframes and our competitors, many with more substantial development resources, may be able to develop competing products that are equal to or better than the descriptionones we market. This may make the products we market obsolete or undesirable by comparison and reduce our revenue.

Our success will depend on our ability to engage and retain qualified technical personnel who are difficult to attract.

Our success will depend on our ability to attract and retain qualified technical personnel to assist in this reportresearch and development, testing, product implementation, low-scale production and technical support. The demand for such personnel is high and the supply of qualified technical personnel is limited. A significant increase in the wages paid by competing employers could result in a reduction of our business objectives is extremely generaltechnical work force and is not meantincreases in the wage rates that we must pay or both. If either of these events were to restrict the discretionoccur, our cost structure could increase and our growth potential could be impaired.

Loss of key members of our management who we need to searchsucceed could adversely affect our business.

We are highly dependent on the services of key members of our management team, and the loss of any of their services could have an adverse effect on our future operations. We do not currently maintain key-man life insurance policies insuring the life of any member of our management team.

Our executive management team, including our Chief Executive Officer and President, allocate part of their time to other companies.

Members of our executive management team, including Mr. Meeker, the Chief Executive Officer and President of our company, are also in management positions with other companies. Each of these individuals may allocate their time between the affairs of the Company and the affairs of other companies. This situation presents the potential for conflicts of interest in determining the respective percentages of their time to be devoted to the affairs of the Company and enter into potential business opportunities. the affairs of others. In addition, if the affairs of these other companies require members of our management team to devote more substantial amounts of their time to the affairs of the other companies in the future, it could limit their ability to devote sufficient time to our affairs and could have a negative impact on our business.

We will be required to invest in facilities and equipment on a continuing basis, which will put pressure on us to finance these investments.

We have not chosen the particular businessinvested, and intend to continue to invest, in whichfacilities and state-of-the-art equipment in order to increase, expand or update our capabilities and facilities. However, there can be no assurance that we will engagegenerate sufficient funds from operations to maintain our existing facilities and equipment or to finance any required capital investments or that other sources of funding will be available. Additionally, there can be no guarantee that any future expansion will not negatively affect earnings.

Our future will depend on our ability to increase sales.

We currently sell our products through direct sales by our contract employees and indirectly through distributor relationships. We incurred increased sales and marketing expenses in building and expanding our direct sales force, and there can be no assurance that we will generate increased sales as a result of this effort.

There may be fluctuations in our operating results, which will impact our stock price.

Significant annual and quarterly fluctuations in our results of operations may be caused by, among other factors, our volume of revenues, the timing of new product or service announcements, releases by us and our competitors in the marketplace of new products or services, seasonality and general economic conditions. There can be no assurance that the level of revenues achieved by us in any particular fiscal period will not be significantly lower than in other comparable fiscal periods. Our expense levels are based, in part, on our expectations as to future revenues. As a result, if future revenues are below expectations, net income or loss may be disproportionately affected by a reduction in revenues, as any corresponding reduction in expenses may not be proportionate to the reduction in revenues.

Our revenues will depend upon our customers receiving prompt and adequate reimbursement from private insurers and national health systems.

Political, economic and regulatory influences are subjecting the healthcare industry in the United States to fundamental change. The ability of hospitals to pay fees for allograft bone tissue products depends in part on the extent to which reimbursement for the costs of such materials and related treatments will continue to be available from private health coverage insurers and other organizations. We may have difficulty gaining market acceptance for the products we sell if third-party payors do not conductedprovide adequate coverage and reimbursement to hospitals. Major third-party payors of hospital services and hospital outpatient services, such as private healthcare insurers, annually revise their payment methodologies, which can result in stricter standards for reimbursement of hospital charges for certain medical procedures or the elimination of reimbursement. Further, private healthcare insurer cutbacks could create downward price pressure on our products.

Our operating results will be harmed if we are unable to effectively manage and sustain our future growth.

We might not be able to manage our future growth efficiently or profitably. Our business is unproven on a large scale and actual revenue and operating margins, or revenue and margin growth, may be less than expected. If we are unable to scale our production capabilities efficiently, we may fail to achieve expected operating margins, which would have a material and adverse effect on our operating results. Growth may also stress our ability to adequately manage our operations, quality of products, safety and regulatory compliance. In order to grow, we may be required to obtain additional financing, which may increase our indebtedness or result in dilution to our stockholders. Further, there can be no assurance that we would be able to obtain any additional financing.

Future business combinations or acquisitions may be difficult to integrate and cause our attention to be diverted.

We may pursue various business combinations with other companies or strategic acquisitions of complementary businesses, product lines or technologies. There can be no assurance that such acquisitions will be available at all, or on terms acceptable to us. These transactions may require additional financing which may increase our indebtedness or outstanding shares, resulting in dilution to stockholders. The inability to obtain such future financing may inhibit our growth and operating results. Integration of acquisitions or additional products can be time consuming, difficult and expensive and may significantly impact operating results. Furthermore, the integration of any acquisition may divert management’s time and resources from our core business. We may sell some or all of our product lines to other companies or may agree to combine with another company. Selling some of our product lines may inhibit our ability to generate positive operating results going forward.

We may be subject to future product liability litigation that could be expensive and our insurance coverage may not be adequate in a catastrophic situation.

Although we are not currently subject to any product liability proceedings, and we have no reserves for product liability disbursements, we may incur material liabilities relating to product liability claims in the future, including product liability claims arising out of the usage of our products. We do not currently carry product liability insurance and our insurance coverage and any reserves we may maintain in the future for product related liabilities may not be adequate and our business could suffer material adverse consequences.

The manufacturers and suppliers of the products we market studiesare subject to continuing regulatory compliance by the FDA which is costly and could result in delays in the commercialization of the products we market.

The manufacturers and suppliers of the products we market are subject to regulation by the FDA. These regulations govern manufacturing of cellular and tissue products as well as the introduction of new medical devices, the observance of certain standards with respect to any business or industry for you to evaluate the possible merits or risksdesign, manufacture, testing, labeling, promotion and sales of the target business devices, the maintenance of certain records, the ability to track devices, the reporting of potential product defects, the import and export of devices and other matters. Further, the manufacturers that create the products we market are facing an increasing amount of scrutiny and compliance costs as more states are implementing regulations governing medical devices, pharmaceuticals and/or biologics and these regulations could affect many of the particular industryproducts we market, which could impact our sales revenue.

As a distributor, we are subject to certain registration and listing requirements by the FDA and similar state authorities.

As a distributor and marketer of such FDA-regulated products, we are subject to independent requirements to register and list certain products, may be required to obtain state licensure or certifications and may be subject to inspections, in addition to complying with derivative requirements applicable to the manufacturers of the products we market. Failure to comply with applicable requirements could result in a wide variety of enforcement actions ranging from warning letters to more severe sanctions such as: fines and civil penalties operating restrictions, injunctions and criminal prosecutions all of which could adversely impact our business.

Future revenue will depend on our ability to develop new sales channels and there can be no assurance that these efforts will result in significant revenues.

We are heavily dependent on developing sales channels for the products we sell, but there can be no assurance that these channels can be developed or that we will continue to be successful in selling our products. We currently sell the products through representative networks, independent contractors and employed representatives. We are engaging in a major initiative to build and further expand our direct sales force. This effort will have significant costs that will be incurred prior to the generation of revenue sufficient to cover these costs. The costs incurred for these efforts may impact our operating results and there can be no assurance of their effectiveness. Many of our competitors have well-developed sales channels and it may be difficult for us to break through these competitors to take market share. If we are unable to develop these sales channels, we may ultimately operate. Tonot be able to grow revenue or maintain our current level of revenue generation.

Because we became public through a reverse merger, we may not be able to attract the extent we enter intoattention of major brokerage firms or certain investors.

There are coverage risks associated with our becoming public through a business combination with a financially unstable company or an entity in its early stagereverse merger, including, among other things, security analysts of development or growth, including entities without established recordsmajor brokerage firms may not provide coverage of sales or earnings, we will become subjectus as there is no incentive to numerous risks inherent inbrokerage firms to recommend the business and operationspurchase of financially unstable and early stage or potential emerging growth companies.our common stock. In addition, we may not attract the attention of major brokerage firms and certain investors due 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, weour low stock price. We cannot assure you that brokerage firms would want to conduct any public offerings on our behalf in the future.

The market price of our common stock is extremely volatile, which may affect our ability to raise capital in the future and may subject the value of your investment to sudden decreases.

The market price for securities of biotechnology companies, including ours, historically has been highly volatile, and the market from time to time has experienced significant price and volume fluctuations that are unrelated to the operating performance of such companies. Fluctuations in the trading price or liquidity of our common stock may harm the value of your investment in our common stock.

Factors that may have a significant impact on the market price and marketability of our securities include:

In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been instituted. These lawsuits often seek unspecified damages, and as with any litigation proceeding, one cannot predict with certainty the eventual outcome of pending litigation. Furthermore, we may have to incur substantial expenses in connection with any such lawsuits and our management’s attention and resources could be diverted from operating our business as we respond to any such litigation. We maintain insurance to cover these risks for us and our directors and officers, but our insurance is subject to high deductibles to reduce premium expense, and there is no guarantee that the insurance will properly ascertaincover any specific claim that we currently face or assess all significant risk factors.

Shares of common stock are equity securities and are subordinate to any indebtedness.

Shares of our attention from various unaffiliated sources, including securities broker-dealers, investment bankers, venture capitalists, bankerscommon stock are common equity interests. This means that our common stock will rank junior to any outstanding shares of our preferred stock that we may issue in the future and any future indebtedness we may incur and to all creditor claims and other membersnon-equity claims against us and our assets available to satisfy claims on us, including claims in a bankruptcy or similar proceeding.

Additionally, unlike indebtedness, where principal and interest customarily are payable on specified due dates, in the case of our common stock, (i) dividends are payable only when and if declared by our board of directors or a duly authorized committee of our board of directors, and (ii) as a corporation, we are restricted to making dividend payments and redemption payments out of legally available assets. We have not paid or declared any dividends on our common stock during the financial community, whopast two fiscal years and we do not intend to pay any dividends on our common stock in the foreseeable future. Furthermore, our common stock places no restrictions on our business or operations or on our ability to incur indebtedness or engage in any transactions, subject only to the voting rights available to shareholders generally.

Our stockholders may present solicitedexperience significant dilution if future equity offerings are used to fund operations or unsolicited proposals. acquire complementary businesses.

If our future operations or acquisitions are financed through the issuance of equity securities, our stockholders could experience significant dilution. In addition, securities issued in connection with future financing activities or potential acquisitions may have rights and preferences senior to the rights and preferences of our common stock.

We do not anticipate paying dividends in the foreseeable future; you should not buy our stock if you expect dividends.

We currently intend to retain our future earnings to support operations and to finance expansion and, therefore, we do not anticipate paying any cash dividends on our common stock in the foreseeable future.

Our current management can exert significant influence over us and make decisions that are not in the best interests of all stockholders.

Our executive 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.

Our common stock is considered “penny stock” and may be difficult to sell.

The SEC has adopted Rule 3a51-1, which establishes the definition of a “penny stock” for the purposes relevant to us, as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. The market price of our common stock is less than $5.00 per share and therefore may be designated as a “penny stock” according to SEC rules. For any transaction involving a penny stock, unless exempt, Rule 15g-9 requires:

In order to approve a person’s account for transactions in penny stocks, the broker or dealer must:

The broker or dealer must also deliver, prior to any transaction in a business or opportunitypenny stock, a disclosure schedule prescribed by purchasing,the SEC relating to the penny stock market, which, in highlight form:

Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading or sellingand about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.

Generally, brokers may be less willing to execute transactions in securities subject to the “penny stock” rules. This may make it more difficult for investors to dispose of our Common Stock and cause a decline in the market value of our stock. In addition, because the Common Stock is currently traded on the OTC Bulletin Board, investors may find it difficult to obtain accurate quotations of the Common Stock and may experience a lack of buyers to purchase such stock or a lack of market makers to support the stock price.

We could issue “blank check” preferred stock without stockholder approval with the effect of diluting then current stockholder interests and impairing their voting rights, and provisions in our charter documents and under Delaware law could discourage a takeover that stockholders may consider favorable.

Our certificate of incorporation provides for the authorization to issue up to 20,000,000 shares of “blank check” preferred stock with designations, rights and preferences as may be determined from time to time by our board of directors. Our board of directors is empowered, without stockholder approval, to issue one or more series of preferred stock with dividend, liquidation, conversion, voting or other rights which could dilute the interest of, or impair the voting power of, our common stockholders. The issuance of a business. We do not intendseries of preferred stock could be used as a method of discouraging, delaying or preventing a change in control. For example, it would be possible for our board of directors to engage primarily in these activities andissue preferred stock with voting or other rights or preferences that could impede the success of any attempt to change control of our company. In addition, advanced notice is required prior to stockholder proposals, which might further delay a change of control.

If we are not registered as an “investment company” underdeemed to be subject to the Investment Company Act of 1940. We do not believe that registration under the act is1940, as amended, we may be required based uponto institute burdensome compliance requirements and be subject to restrictions relating to 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

The regulatory scope of the Investment Company Act and its regulations.

U.S. and state governmental regulation could restrict our ability to encounter intense competitionsell the products.

AKS is a criminal statute that prohibits the payment or receipt of remuneration, in cash or otherwise, in return for referrals of federal healthcare beneficiaries. The CMS has promulgated certain safe harbors that offer protection from otherliability for arrangements that fall within very specific parameters. To reach the Public Company Exception to the AKS, we must first possess undepreciated net tangible assets related to the furnishing of healthcare items and services of more than $50,000,000 in the previous fiscal year or 12-month period. The Stark Law prohibits physicians or their immediate family members from referring to entities havingthat provide DHSs to federal program beneficiaries if the physician or an immediate family member has a financial relationship (either via a compensation arrangement or ownership interest) directly or indirectly in that entity. Similar to safe harbors for the AKS, the Stark Law regulations created a series of exceptions to provide protection for certain types of business objectivearrangements that fall within their parameters.

In order to meet our objectives in compliance with the Stark Law, we will rely on the Public Company Exception. This exception effectively permits physicians to own investment securities that may be purchased on terms generally available to the public and which are securities (i) in a corporation that had, at the end of the corporation’s most recent fiscal year, or on average during the previous three fiscal years, stockholder equity exceeding $75,000,000 and (ii) listed on the New York Stock Exchange, the American Stock Exchange, or any regional exchange in which quotations are published on a daily basis, or foreign securities listed on a recognized foreign, national, or regional exchange in which quotations are published on a daily basis, or traded under an automated interdealer quotation system operated by the National Association of Securities Dealers.

Many states also include laws similar to ours. ManyAKS or the Stark Law to which we may be subject to. If it is determined that our business arrangements fail to comply with the AKS, the Stark Law or similar state laws, we could face significant civil and/or criminal penalties.

Pursuant to the Sunshine Act enacted as part of the Affordable Care Act, we are required to report annually to the CMS beginning in 2014 certain payments and other transfers of value furnished to physicians and teaching hospitals, as well as certain ownership or investments held by physicians or their family members. These annual reports will be publicly available. Failure to report timely, accurately, and completely may subject us to civil monetary penalties. Some states have laws similar to the federal Sunshine Act.

The scope and enforcement of all of these entities, includinglaws is uncertain and subject to rapid change, especially in light of the lack of applicable precedent and regulations. There can be no assurance that federal or state regulatory or enforcement authorities will not investigate or challenge our current or future activities under these laws. Any investigation or challenge could have a material adverse effect on our business, financial consulting companiescondition and ventureresults of operations. Any state or federal regulatory or enforcement review of us, regardless of the outcome, would be costly and time consuming. Additionally, we cannot predict the impact of any changes in these laws, whether these changes are retroactive or will have effect on a going-forward basis only.

Our independent auditors included an emphasis-of-matter paragraph in their opinion about the Company’s ability to continue as a going concern, which may hinder our ability to obtain future financing.

As of December 31, 2014, the Company has had losses from operations for the last several quarters and is currently dependent on its ability to raise capital firms, have longerfrom stockholders or other sources. Ultimately, we hope to resume viable profitable operations when operating historiesefficiencies can be realized and have extensive experience in identifying and effectingour business combinations, directly or through affiliates. Manyplan is fully implemented. The consolidated financial statements do not include any adjustments that might result from the outcome of these competitors possess significantly greateruncertainties. Recurring losses from operations raises substantial doubt about the Company's ability to continue as a going concern. In their report dated April 15, 2015, our independent registered public accounting firm included an emphasis-of-matter paragraph with respect to our financial technical and other resources than we do. We cannot assure youstatements for the year ended December 31, 2014, concerning the Company’s assumption that we will continue as a going concern. Management plans to raise additional funds through offering our shares of common stock in private and/or public offerings and through debt financing, if available and needed. Our continued net operating losses increases the difficulty in meeting our plans and we might not 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 aobtain additional financing on favorable terms, if at all, which could materially adversely affect our business combination. If we are forced to evaluate these less attractive prospects, we cannot assure you that our stated business objectives will be met.

ITEM 1B. UNRESOLVED STAFF COMMENTS.

Not applicable.

ITEM 2. PROPERTIES.

Our only employeefacility 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.)

Our common stock trades in the over-the-counter market and is tradedquoted on the OTCOver the Counter Bulletin Board (“OTCBB”) under the trading symbol “TEEE”. FZMD. The trading market for our common stock has been extremely limited and sporadic.

Below is a table indicating the range of high and low bid information for the common stock as reported by the OTC Bulletin BoardOTCBB 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.

Transfer Agent

Our current transfer agent and registrar for our common stock is American Stock Transfer & Trust Company, LLC.

Holders of Record

As of November 15, 2013, we believeApril 13, 2015, there were approximately 2,000 beneficial 744 holders of record of the Company’s common stock.

Dividends

We have not paid or declared any dividends on our common stock.

Indemnification of $41,100Directors and Officers

Our certificate of incorporation and by-laws contains certain provisions permitted under the Delaware General Corporation Law relating to the liability of directors. The provisions eliminate a director’s liability for monetary damages for a breach of fiduciary duty, except in certain circumstances where such liability may not be eliminated under applicable law. Further, the Company’s certificate of incorporation and by-laws contain provisions to indemnify the Company’s directors and officers to the fullest extent permitted by the Delaware General Corporation Law.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the Company’s outstanding promissory notes, bearing interest at an annual rate of 5.25%, were converted, atSEC, such indemnification is against public policy as expressed in the election of the holders thereof, into an aggregate of 798,808 shares of common stock, at fixed conversion rates ranging from $0.033 to $0.08 per share as stated in each respective promissory note.

As a result of the Merger and the change in business and operations of the Company, a discussion of the past financial results of the Company, formally known as Golf Rounds.com, is not pertinent, and, under generally accepted accounting principles in the United States, the historical financial results of Fuse, the acquirer for accounting purposes, prior to the Merger are considered the historical financial results of the Company.

The following discussion highlights Fuse’s results of operations and the principal factors that have affected its consolidated financial condition as well as its liquidity and capital resources for the periods described, and provides information that management believes is relevant for an assessment and understanding of the Company’s consolidated financial condition and results of operations presented herein. The following discussion and analysis are based on Fuse’s audited and unaudited financial statements contained in this Annual 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 speaks 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 combinationbeen prepared in accordance with competitive factors and other risk factors as set forth in Exhibit 99.1 includedgenerally accepted accounting principles in the 10-K ReportUnited States. You should read the discussion and analysis together with such financial statements and the related notes thereto.

On May 30, 2014, the Company changed its fiscal year end from August 31 to December 31. Accordingly, for the year ended December 31, 2014, the comparable period reflected below is for the year ended August 31, 20082013.

Overview

The medical distribution industry is in a mature life-cycle phase. For most of the products we offer there are a number of integrated competitors, several of which are publicly traded, that not only manufacture and produce their own products, but also have established distribution and sales networks and participate in large group purchasing organizations within the medical industry. Most of these competitors have linked physicians to their entities by engaging select physician and surgical specialties through consulting agreements, clinical trials remuneration and other compensation models. As mature companies, they also have extensive legacy systems and expensive administrative and sales commission cost structures. In addition, there are numerous independent medical distributorships primarily focused on limited geographic markets and products located across the United States.

Few competitive companies, however, are structured to allow for physician and key stakeholder equity, profit participation and operational input in their companies. As a growth company, we currently compete through the following means:

Strategy

Our strategy is to continue to expand our end customer, physician, manufacturer and supplier partnership base, both in the regions we currently serve and in new regions across North America that are conducive to our business model. The principal elements of our business strategy are to:

Integrate and Increase Profits

We intend to continue integrating and implementing best practices across all aspects of our operating facilities and product service lines, including financial, staffing, technology, products and packaging, distribution network and compliance.

Our customers and partners require high levels of regulatory compliance, which we intend to accomplish through employee training, facility policies and procedures coupled with ongoing analysis of operating performance. We intend to implement new accounting, invoicing, and logistics management and information technology systems. We believe all of these measures will increase the quality of service we can provide to our customers, increase the visibility of the Company, and maximize profitability.

Expand Services and Supply Volume

We intend to expand our product and services supply volume as filed on November 7, 2008.

In January 2014, we executed a distributorship agreement with Flower Orthopedics Corporation (“Flower”), a national orthopedic internal fixation manufacturer. This national semi-exclusive agreement allowed for direct product sales to acute care hospitals under both consignment and stock-and-bill arrangements. In addition, the agreement allowed for profit participation for ambulatory surgical centers and physician offices business that the Company was responsible for developing in conjunction with another national medical supply and distribution company. On July 16, 2014, we terminated the distributorship agreement with Flower.

On July 17, 2014, we entered into an Independent Representative Agreement with Vilex, Inc. (“Vilex”), another national orthopedic internal fixation manufacturer, pursuant to which the Company was appointed as a representative of Vilex to promote and sell Vilex’s products in the United States. Under the agreement, the Company is a non-exclusive representative of Vilex, except for certain specified customers. The term of the Agreement is five years, and will automatically renew for additional one-year periods at the expiration of the original term unless terminated as provided therein. The Company will be paid a commission based on its net sales.

Improve our Corporate Office

The Company has completed improvements to its leased corporate offices and has relocated its executive and senior management team members. We feel this will provide for greater integration of our planning, operating and reporting systems.

Pursue Selective Strategic Relationships or Acquisitions

In the United States, the Company will continue to explore additional mergers and acquisitions and seek strategic alliances on a national basis with other companies that are developing, producing or distributing healthcare products and services. We plan to focus on partnerships and acquisitions that not only add revenues, cash flow and profitability to our financial position, but those that provide short and long-term growth potential and support the strategic goals and objectives of the Company.

Explore International Markets

Internationally, we are exploring strategic partnerships and business models to penetrate the healthcare sectors for the products and services the Company provides.

As a long-term objective, the Company will continue to explore the expansion of our operations and products into international markets. We have developed several relationships in markets where we believe the products, services and systems will be able to support an underserved market for western-based healthcare including the Middle East and Asia. We believe that moving into international markets will further establish the Company as a leader in our industry sector and will add incremental net income to the organization.

Results of Operations

Year Ended December 31, 2014 Compared to Year Ended August 31, 2013

Net Revenues

For the year ended December 31, 2014, net product revenues were $941,086, compared to $979,539 for the year ended August 31, 2013, a decrease of $38,453, or 3.9%. Our pricing for amniotics was high when we initially began selling them. Subsequently, the reimbursable amounts received by our customers from insurance companies were found to be much lower than we anticipated. During April 2013 through June 2013, we significantly reduced our retail pricing in order to better align our prices with reimbursable amounts received by our customers from insurance companies. In addition, commencing November 2013, we began selling larger order quantities of the same product (subject to minimums) at a discounted selling price. On an aggregate basis, the selling prices of our products decreased by approximately 44.5% during the current year period. The decrease in selling prices at the retail level had no effect on outstanding accounts receivable for sales made prior to April 2013. Selling prices were changed prospectively and no bad debt occurred as a result of the decreased selling prices. Even though the number of units sold increased substantially (see cost of revenues below) during the current year period compared to the prior year period, this was more than offset by the decrease in contract pricing extended to our retail customers as well as the commencement of selling larger order quantities of the same product (subject to minimums) at a discounted selling price. Accordingly, net revenues decreased while the costs of revenues increased.

For the year ended December 31, 2014, consulting revenues were $0, compared to $79,800 for the year ended August 31, 2013. During the year ended December 31, 2014, we elected not to move forward with this consulting relationship.

Cost of Revenues

For the year ended December 31, 2014, our cost of revenues was $485,384, compared to $203,532 for the year ended August 31, 2013, representing an increase of $281,852, or 139%. During the year ended December 31, 2014, we established an allowance for inventory obsolescence of $133,319. Excluding the allowance for obsolescence recognized during 2014, our cost of revenues increased by $148,533, or 73.0%. During the periods presented (including the period from April to June 2013 when we significantly reduced our retail pricing), the costs of our individual inventory items did not materially change. In other words, our cost of revenues, on a per unit basis, did not increase significantly during the year ended December 31, 2014 compared to the prior year period. Accordingly, excluding the establishment of an allowance for inventory obsolescence, the percentage increase in costs of revenues represented approximately the same percentage increase in the number of units sold. The increase in cost of revenues was due to an increase in the number of units sold as well as the establishment of a reserve for inventory obsolescence. Cost of revenues includes costs to purchase goods, transportation, storage, sales representatives and account management.

Gross Profit

For the year ended December 31, 2014, we generated a gross profit of $455,702, compared to $855,807 for the year ended August 31, 2013, a decrease of $400,105, or 46.8%. The decrease in gross profit was primarily due to a decrease in contract pricing extended to our customers during the period from April to June 2013, the commencement in November 2013 of selling larger order quantities of the same product (subject to minimums) at a discounted selling price, and the establishment of an allowance for inventory obsolescence of $133,319 and a decrease in consulting revenues of $79,800. Excluding the establishment of an allowance for inventory obsolescence in the current year period and consulting revenues for the comparable prior year period, gross margins were 62.6% in the current year vs. 79.2% for the comparable prior year period. The decrease in gross margin percentage is primarily the result of the aforementioned decrease in contract pricing and commencement of selling larger order quantities at a discounted selling price.

Operating Expenses

General, Administrative and Other

For the year ended December 31, 2014, general, administrative and other operating expenses increased to $1,469,864 from $419,752 for the year ended August 31, 2013, representing an increase of $1,050,112, or 250%. This increase is primarily attributable to the costs associated with being a public company whereas there were no such costs in the prior year period. In particular, salaries and wages increased by $448,620 and legal and professional fees increased by $343,169. Further, this increase is attributable to the Company’s expansion strategy and related costs to fund operations. General, administrative and other operating expenses during the year ended December 31, 2014 consisted primarily of salaries and wages, legal and professional fees, travel expenses, rent and insurance.

Merger Costs

For the year ended December 31, 2014, merger costs increased to $320,448 from $0 for the year ended August 31, 2013. Merger costs were incurred for the merger with Golf Rounds.com, Inc. that closed on May 28, 2014.

Interest Expense

For the year ended December 31, 2014, interest expense increased to $71,612 from $669 for the year ended August 31, 2013, representing an increase of $70,943, or 10,604%. Interest expense increased due to the issuance of an aggregate of $1,452,014 of promissory notes payable since December 31, 2013. Interest expense also includes interest on the Company’s line of credit, which is described in “Liquidity and Capital Resources”.

Net Income (Loss)

For the year ended December 31, 2014, the Company generated a net loss of ($1,405,045) compared to net income of $435,386 for the year ended August 31, 2013. The change from net income to a net loss is primarily due to the increase in operating expenses.

Four Months Ended December 31, 2013 Compared to Four Months Ended December 31, 2012

Net Revenues

For the four months ended December 31, 2013, net product revenues were $250,947, compared to $405,912 for the four months ended December 31, 2012, a decrease of $154,965, or 38.2%. Our pricing for amniotics was high when we initially began selling them. Subsequently, the reimbursable amounts received by our customers from insurance companies were found to be much lower than we anticipated. During April 2013 through June 2013, we reduced significantly our retail pricing in order for our prices to align better with reimbursable amounts from insurance companies received by our customers. On an aggregate basis, the selling prices of our products decreased by approximately 54.9% during the current year period. The decrease in selling prices had no effect on outstanding accounts receivable for sales made prior to April 2013. Selling prices were changed prospectively and no bad debt occurred as a result of the decreased selling prices. Even though the number of units sold increased substantially (see cost of revenues below) during the current year period compared to the prior period, the increased number of units sold was more than offset by the significant decrease in contract pricing extended to our customers. The decrease in contract pricing extended to our customers primarily accounted for the decrease in net revenues.

For the four months ended December 31, 2013, consulting revenues were $26,600, compared to $0 for the four months ended December 31, 2012.

Cost of Revenues

For the four months ended December 31, 2013, our cost of revenues was $83,109, compared to $60,620 for the four months ended December 31, 2012, representing an increase of $22,489 or 37.1%. During the period from April to June 2013, the costs of our inventory items did not materially change. Accordingly, the 37.1% increase in costs of revenues represented approximately the same increase in the number of units sold. The increase in cost of revenues was due to an increase in the number of units sold. Our cost of revenues, on a per unit basis, did not increase significantly during the four months ended December 31, 2013. Cost of revenues includes costs to purchase goods, transportation, storage, sales representatives and account management.

Gross Profit

For the four months ended December 31, 2013, we generated a gross profit of $194,438, compared to $345,292 for the four months ended December 31, 2012, a decrease of $150,854, or 43.7%. The decrease in gross profit was primarily due to the decrease in net revenues, which resulted primarily from a reduction in contracted prices in client facilities.

Operating Expenses

General, Administrative and Other

For the four months ended December 31, 2013, general, administrative and other operating expenses increased to $388,791 from $142,689 for the four months ended December 31, 2012, representing an increase of $246,102, or 173%. General, administrative and other operating expenses consist primarily of salaries and wages, stock-based compensation, legal and professional fees and travel expenses, as well as other general and administrative expenses. This increase is attributable to Fuse’s expansion strategy and related costs to fund operations.

We intend to expand our product and services supply volume, as well as our number of facility clients, by growing our relationships with product manufacturers and suppliers and development of our sales and account management representative network structure to drive physician and facility relationships. This expansion will result in an increase in our working capital needs to fund the purchase of inventory, the cost of labor and other operating costs. This growth will require not only an increase in our net borrowings, but also will result in an increase in our accounts payable to the manufacturers as well as a corresponding increase in sales and associated accounts receivable from clients. The use of funds as part of our expansion strategy will primarily consist of increased inventory, salaries and case coverage costs, legal fees, information technology platforms, and travel and marketing expenses.

Interest Expense 

For the four months ended December 31, 2013, interest expense increased to $746 from $112 for the four months ended December 31, 2012, representing an increase of $634, or 566%. Interest expense increased due to a higher average balance outstanding on the Company’s line of credit.

Net Income (Loss)

For the four months ended December 31, 2013, the Company generated a net loss of ($194,729) compared to net income of $202,491 for the four months ended December 31, 2012. The change from net income to net loss is primarily due to the decrease in net revenues and the increase in general, administrative and other operating expenses.

Liquidity and Capital Resources

Net cash used in operating activities during the year ended December 31, 2014 totaled $1,168,784 and resulted primarily from a net loss of $1,405,045 and an increase in accounts receivable of $54,339, partially offset by a decrease in inventories of $111,733 (resulted from establishing a reserve for obsolescence of $133,319), advances to Golf Rounds.com, Inc. expensed to merger costs of $105,000, and an increases in accounts payable of $93,210.

Net cash used in investing activities during the year ended December 31, 2014 totaled $70,313 and resulted from $60,954 of purchases of property and equipment, advances to Golf Rounds.com, Inc. of $10,000, offset by cash acquired in reverse merger of $641.

Net cash provided by financing activities during the year ended December 31, 2014 was $1,294,313 and resulted primarily from proceeds of $1,452,014 ($724,238 from related parties) from the issuance of promissory notes, partially offset by repayment of our line of credit of $100,000.

The Company maintained a $100,000 line of credit with Trinity Bank bearing interest of 2.25% per year, based on a 360-day year. The line of credit required minimum monthly payments of interest only. The line of credit was secured by a money market account owned by Dr. and Mrs. Christopher Pratt that is also maintained at Trinity Bank. Dr. Pratt is the Chief Medical Officer and a director of the Company. On October 16, 2014, the line of credit was fully repaid.

During the period from January 1, 2014 through May 28, 2014, Fuse made cash distributions of $40,583 to the minority interest owners of Fuse Medical V, LP and Fuse Medical VI, LP. Pursuant to the partnership agreements of Fuse Medical V, LP and Fuse Medical VI, LP, available cash flow distributions were to be paid within 30 days of month-end. Prior to the Merger, and effective on and as of the business day immediately prior to the effective time of the Merger, the general partners in Fuse Medical V, LP and Fuse Medical VI, LP agreed to surrender their interests and the individual physicians that owned the remaining limited partnership interests in Fuse Medical V, LP and Fuse Medical VI, LP agreed to exchange their interest for corresponding interests in Fuse Medical, LLC, each becoming one of the Holders. Accordingly, as of May 28, 2014, distributions to the minority interest owners of Fuse Medical V, LP and Fuse Medical VI, LP ceased. We do not anticipate declaring any dividends prior to regaining profitability. The payment of dividends will be contingent upon our revenues and earnings, if any, our capital requirements and our general financial condition. The payment of any dividends 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.

We intend to increase our revenues by expanding our client base as well as growing the number of manufacturers and suppliers from which we obtain products. We plan to increase the number of facility clients and physicians offering our products by utilizing our existing sales and account management representative network structure to drive physician and facility relationships. Our plans to increase the number of product lines available for sale will result in entering into agreements with manufacturers or suppliers, some of which may require the purchase of inventory while others may involve consigned inventory or a commission structure not requiring the purchase of inventory. In sum, our expansion strategy will likely require an increase in our working capital to fund increased inventories, accounts receivable and operating costs, including salaries and case coverage costs, legal fees, information technology platforms and travel and marketing expenses, offset by any increases in our accounts payable to the product manufacturers and suppliers. The working capital needed for this expansion shall be derived from an increase in our net borrowings, sale of our securities or a combination thereof.

Historically, our primary sources of liquidity have been from the issuances of debt and equity securities. Since December 31, 2013, we raised gross proceeds of $1,512,014 through the issuance of two-year promissory notes payable. The notes were unsecured, bore interest at 7.0% and required 18 monthly payments of interest only commencing at the beginning of month seven. Our outstanding notes payable had maturity dates commencing December 2015. On December 31, 2014, the outstanding principal balance of notes payable of $1,512,014 and accrued interest of $57,893 was converted into 1,509,528 common shares of the Company. Since the beginning of 2015, we have received proceeds of: (i) $100,000 from a loan from a significant stockholder; (ii) $100,000 from the sale of common shares to a related party; and (iii) $80,000 from the sale of common shares in private offerings.

At December 31, 2014, we had working capital of $147,054, including $67,555 in cash and cash equivalents. As of April 13, 2015, the Company had approximately $137,000 in available cash. The Company is currently attempting to raise up to $2,000,000 from private offerings (of which $80,000 has been raised to date) in order to fund operations. These proceeds will be used to meet cash flow deficits during the next 12 months and to accelerate the growth of the business. If we are unable to raise capital, we believe that, with our current available cash along with anticipated revenues, we will need to reduce operating expenses. Depending on our cash position, we may spend up to $100,000 in capital expenditures over the next 12 months. These capital expenditures will be allocated across growth initiatives, including expansion of amniotics relationships. Depending on the results of management’s efforts to realize efficiencies in technology development and utilize our physician network, our capital expenditures may be less than anticipated. Our cash balances are kept liquid in order to support our growing infrastructure needs. The majority of our cash is concentrated in a large financial institution.

The estimated costs of operations while we ramp up our revenues is substantially greater than the amount of funds we had available on December 31, 2014. The Company’s existence is dependent upon management’s ability to implement its business plan and/or obtain additional funding. 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.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As of December 31, 2014, the Company has had losses from operations for the last several quarters and is currently dependent on its ability to raise capital from stockholders or other sources in order to sustain operations and eventually resume profitable operations. Management plans to raise additional funds through offering our shares of common stock in private and/or public offerings and through debt financing, if available and needed. There can be no assurances, however, that the Company will be able to obtain any financings or that such financings will be sufficient to sustain our business operations or permit the Company to implement its intended business strategy. The Company plans to become profitable by increasing the sale of internal fixation, durable bone materials, biologics, tissues, surgical and other related surgical products that it markets, distributes and sells.

In their report dated April 15, 2015, our independent registered public accounting firm included an emphasis-of-matter paragraph with respect to our financial statements for the year ended December 31, 2014 concerning the Company’s assumption that we will continue as a going concern. Our ability to continue as a going concern is an issue raised as a result of current working capital requirements and recurring losses from operations.

The Company has financed its operations from the issuance of notes payable and equity securities. As of December 31, 2014, all notes payable other than those listed below had been converted into common shares of stock of the Company.

On May 28, 2014, we acquired $17,250 of notes payable due to PharmHouse Pharmacy. As of April 13, 2015, the aggregate notes payable are $17,250 to PharmHouse Pharmacy. The maturity dates and amounts of each individual notes payable are as follows:

Outstanding Notes Payable

On May 28, 2014, as part of the Merger, the Company assumed an aggregate of $17,250 of promissory notes payable to PharmHouse Pharmacy. The notes are unsecured, bear interest at 3.25% and require quarterly payments of interest only. The outstanding principal balance along with all accrued and unpaid interest is due at maturity.

In addition, the Company expects Cooks Bridge, LLC and Cooks Bridge II, LLC to assist in the funding of its working capital and growth needs in the future.

Off-balance Sheet Arrangement

The Company has no off-balance sheet arrangements.

Related Party Transactions

No related party transactions had a material impact on our operating results. See Item 13 below and Note 13 - “Related Party Transactions” to the Company’s financial statements.

New Accounting Pronouncements

See Note 2 - “Significant Accounting Policies” to the Company’s financial statements.

Critical Accounting Policies

The preparation of financial statements and related notes includeddisclosures in this Report.

The accompanying consolidated financial statements have been prepared assuming that the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2013-04, “Liabilities (Topic 405): Obligations ResultingCompany will continue as a going concern. As of December 31, 2014, the Company has had losses from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date (a consensus the FASB Emerging Issues Task Force)”. ASU 2013-04 provides guidanceoperations for the recognition, measurement,last several quarters and disclosure of obligations resultingis currently dependent on its ability to raise capital from jointstockholders or other sources. Ultimately, we hope to resume viable profitable operations when operating efficiencies can be realized and several liability arrangements for which the total amount of the obligation within the scope of this guidanceour business plan is fixed at the reporting date, except for obligations addressed within existing guidance in U.S. generally accepted accounting principles (GAAP).fully implemented. The guidance requires an entity to measure those obligations as the sum of: (a) the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors and (b) any additional amount the reporting entity expects to pay on behalf of its co-obligors. The amendments in this Update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company does not expect the adoption of this guidance to have a material effect on the Company’s consolidated financial statements.

Management plans to raise additional funds through offering our shares of common stock in private and/or public offerings and through debt financing, if available and needed. There can be no assurances, however, that the tax lawCompany will be able to obtain any financings or that such financings will be sufficient to sustain our business operations or permit the Company to implement its intended business strategy. The Company plans to become profitable by increasing the sale of internal fixation, durable bone materials, biologics, tissues, surgical and other related surgical products that it markets, distributes and sells.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As a smaller reporting company, as defined in Rule 12b-2 of the applicable jurisdiction doesExchange Act, we are not requirerequired to provide the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The amendments ininformation required by this Update are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company does not expect the adoption of this guidance to have a material effect on the Company’s consolidated financial statements.