On December 18, 2013, 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. On December 18, 2013, Fuse Medical, LLC entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Fuse Medical, LLC (“Fuse”Golf Rounds.com, Inc. (the “Registrant”), Project Fuse LLC a wholly owned(a wholly-owned subsidiary of the CompanyGolf Rounds.com, Inc.) (“Merger Sub”), and D. Alan Meeker, solely in his capacity as the representative of the members of Fuse membersMedical, LLC (the “Representative”). Upon consummation ofOn May 28, 2014, the transactions contemplated by the Merger Agreement closed wherein Merger Sub will mergemerged with and into Fuse Medical, LLC, with Fuse Medical, LLC surviving as a wholly ownedwholly-owned subsidiary of Golf Rounds.com, Inc. (the “Merger”).

Effective as of May 28, 2014, prior to the consummation of the Merger, Golf Rounds.com, Inc. amended its certificate of incorporation to: (i) change its name from “GolfRounds.com, Inc.” to “Fuse Medical, Inc.”, (ii) increase its authorized capital stock from 12,000,000 shares of common stock to 500,000,000 shares of common stock and from zero shares of preferred stock to 20,000,000 shares of preferred stock, and to expressly authorize its board of directors to issue shares of the preferred stock, in one or more series, and to fix for each such series the voting powers, designations, preferences, or other special rights and the qualifications, limitations or restrictions, and (iii) effect a 14.62 to 1 reverse stock split (the “Reverse Stock Split”) whereby every 14.62 issued and outstanding shares of its common stock automatically converted into one share of common stock, subject to the treatment of fractional share interests. All references to shares of common stock of the Company herein are discussed on a post-Reverse Stock Split basis.

All of the units reflecting membership interests in Fuse Medical, LLC that were issued and outstanding immediately prior to the effective time of the Merger were cancelled and converted into 3,600,000 shares of Fuse Medical, Inc.’s common stock (on a post-Reverse Stock Split basis), representing 90% of the Registrant’s issued and outstanding common stock after giving effect to the Merger (the “Merger”“Merger Consideration”). The Merger is expectedConsideration will be allocated among the members of Fuse Medical, LLC immediately prior to the effective time of the Merger (the “Holders”) in accordance with Fuse Medical’s limited liability company operating agreement.

The merger has been accounted for as a “reverse merger” and recapitalization since, immediately following the completion of the transaction, Fuse Medical, LLC has effective control of Fuse Medical, Inc. through the Holder’s 90% fully diluted stockholder interest in the consolidated entity. In addition, Fuse Medical, LLC has control of the consolidated entity through control of a substantial proportion of the Board by designating six of the seven board seats. Additionally, all of Fuse Medical LLC’s senior executive positions are continuing on as management of the consolidated entity after consummation of the Merger. For accounting purposes, Fuse Medical, LLC will be deemed to be completed during the third fiscal quarteraccounting acquirer in the transaction and, consequently, the transaction will be treated as a recapitalization of 2014.Fuse Medical, LLC. Accordingly, Fuse Medical LLC’s assets, liabilities and results of operations have become the historical financial statements of the registrant, and Golf Rounds.com’s assets, liabilities and results of operations will be consolidated with Fuse Medical effective as of May 28, 2014, the date of the closing of the Merger. No step-up in basis or intangible assets or goodwill will be recorded in this transaction. Reverse merger accounting is a recapitalization of an entity which requires the financial statements to be presented of the accounting acquirer (Fuse Medical, LLC) for periods before and after the reverse merger on a recapitalized basis. Moreover, the financial statements shall include the accounting acquiree (Golf Rounds.com, Inc.) commencing on the date of the merger (May 28, 2014). The financial statements herein are presented on that basis.

Fuse Medical is a physician-partnered company and national distributor that provides diversified healthcare products and supplies, including biologics and bone substitute materials, while striving to document cost savings and clinical outcomes to its manufacturers, physicians, health insurers and medical facility partners. Fuse Medical, LLC has entered into partnership arrangements with physicians in order to distribute its products.

The accompanying unauditedinterim condensed consolidated balance sheet of Golf Rounds.com, Inc. and its wholly owned subsidiaries, DPE Acquisition Corp. and Project Fuse LLC, (collectively, the “Company”), as of February 28, 2014, and the unaudited condensed consolidatedfinancial statements of operations for the three and six months ended February 28, 2014 and 2013, the unaudited condensed consolidated statement of stockholders’ deficit for the six months ended February 28, 2014, and the unaudited condensed consolidated statements of cash flows for the six months ended February 28, 2014 and 2013included herein reflect all material adjustments (consisting of normal recurring adjustments and reclassifications and non-recurring adjustments) which, in the opinion of management, are ordinary and necessary for a fair presentation of results for the interim periods. Certain information and footnote disclosures required under generally accepted accounting principles have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission.Commission (the “SEC”). The Company believes that the disclosures are adequate to make the information presented not misleading.

The condensed consolidated balance sheet information as of AugustDecember 31, 2013 was derived fromis currently unaudited, but shall be audited as part of the audited consolidated financial statements that will be included in the Company’s Annual Report on Form 10-K10-K/T that is due to be filed with the Securities and Exchange Commission on November 15, 2013.or before August 26, 2014. These condensed consolidated financial statements should be read in conjunction with the year-end audited consolidated financial statements for the year ended August 31, 2013 and notes thereto included in the Company’s Annual Report on the Form 10-K for the year ended August 31, 2013.8-K filed on May 29, 2014.

The results of operations for the three and six months ended February 28,March 31, 2014 and 2013 are not necessarily indicative of the results to be expected for the entire fiscal year or for any other period.

The condensed consolidated financial statements include the accounts of Golf Rounds.com, Inc.Fuse Medical, LLC, and its wholly owned subsidiaries DPE Acquisition Corp. (formed on September 2, 2003) and Project Fuse LLC (formed on December 17, 2013)wholly-owned subsidiaries. Collectively, the entities are referred to as “the Company” or “Fuse Medical”. Intercompany transactions and accounts have been eliminated in consolidation.

The carrying amountsCompany’s computation of certain financial instruments, including cashearnings per share (“EPS”) includes basic and cash equivalents, prepaid expenses,diluted EPS. Basic EPS is computed by dividing the income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted EPS is similar to basic EPS, but includes the dilutive effect on a per share basis of potential common shares (e.g., warrants and accounts payable and accrued expenses approximate their fair values becauseoptions) as if they had been converted at the beginning of the short-term maturityperiods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of these instruments.diluted EPS.

In orderMay 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2014-09 (“ASU 2014-09”), “Revenue from Contracts with Customers (Topic 606)”. ASU 2014-09 will eliminate transaction-specific and industry-specific revenue recognition guidance under current U.S. GAAP and replace it with a principle-based approach for determining revenue recognition. ASU 2014-09 will require that companies recognize revenue based on the value of transferred goods or services as they occur in the contract. The ASU also will require additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to continueobtain or fulfill a contract. ASU 2014-09 is effective for reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted. Entities can transition to the standard either retrospectively or as a cumulative effect adjustment as of the date of adoption. Management is currently assessing the impact the adoption of ASU 2014-09 and has not determined the effect of the standard on our ongoing financial reporting.

In April 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2014-08 (“ASU 2014-08”), “Presentation of Financial Statements” (Topic 205) and Property, Plant and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity”. ASU 2014-08 amends the requirements for reporting discontinued operations and to make acquisitions, if any, under our current business model duringrequires additional disclosures about discontinued operations. Under the next twelve months, we will need to secure additional working capital, by way of debtnew guidance, only disposals representing a strategic shift in operations or equity financing, or otherwise. We will need additional financing for working capital, and, inthat have a major effect on the case of acquisitions, for payment of seller notes and future earned cash to sellers of acquired companies. There can be no assurance that we will be able to secure sufficient financing or on terms acceptable to us. If adequate funds are not available on acceptable terms, we would need to delay, limit or eliminate some or all of our proposedCompany's operations and wefinancial results should be presented as discontinued operations. This new accounting guidance is effective for annual periods beginning after December 15, 2014, and interim periods within those years. The Company is currently evaluating the impact of adopting ASU 2014-08 on the Company's results of operations or financial condition.

We have implemented all new accounting standards that are in effect and that may be unable to successfully promoteimpact our productsconsolidated financial statements and do not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on our consolidated financial position or develop new or enhanced products or prosecute acquisitions, anyresults of which could lower our revenues and net income, if we achieve profitability in the future. If we raise additional funds through the issuance of convertible debt or equity securities, the percentage ownership of our current stockholders is likely to be diluted, unless some of our current stockholders were to invest in subsequent convertible debt or equity financings, and some of the newly issued securities may also have rights superior to those of our common stock. Additionally, if we issue or incur debt to raise funds, we may be subject to limitations on our operations.

On October 18, 2013, the Company issuedadvanced $39,000 to Golf Rounds.com, Inc., a publicly-held company, in exchange for a six-month promissory note to Fuse Medical, LLCreceivable due April 15, 20142014. On November 4, 2013, the Company advanced an additional $24,000 to Golf Rounds.com, Inc. in exchange for cash proceeds of $39,000.a six-month promissory note receivable due May 5, 2014. On December 26, 2013, the Company advanced an additional $32,000 to Golf Rounds.com, Inc. in exchange for a six-month promissory note receivable due June 26, 2014. The note isadvances were unsecured, bearsrequired interest at a rate of 3.0% per annum and requireswould have required payment of principal and interest at maturity. On April 1, 2014, the advances maturing April 15, 2014 and May 5, 2014 were amended whereby the maturity date was extended to June 26, 2014. On May 28, 2014, as a result of the closing of the Merger, these advances became part of the consideration to acquire Golf Rounds.com, Inc. (See Notes 1 and 12).

On November 4, 2013,January 14, 2014 and February 6, 2014, the Company issued a six-monthtwo two-year promissory note to Fuse Medical, LLC due May 5, 2014notes in exchange for aggregate cash proceeds of $24,000.$247,801 from a non-related party. The note isnotes are unsecured, bearsbear interest at 3.0%7.0% and requires paymentrequire 18 monthly payments of interest only commencing at the beginning of month seven. The notes include a provision that in the event of default the interest rate would increase to the default interest rate of 18%. The first six months of interest is deferred until maturity. The outstanding principal balance along with all accrued and unpaid interest is due at maturity.

During the period from January 15, 2014 through March 4, 2014, the Company issued a six-monthseveral two-year promissory note to Fuse Medical, LLC due June 26, 2014notes in exchange for aggregate cash proceeds of $32,000.$592,776. The note isfunds were received from entities controlled by officers of the Company. The officers also owned or partially owned the entities from which the funds were received. The notes are unsecured, bearsbear interest at 3.0%7.0% and requires paymentrequire 18 monthly payments of interest only commencing at the beginning of month seven. The notes include a provision that in the event of default the interest rate would increase to the default interest rate of 18%. The first six months of interest is deferred until maturity. The outstanding principal balance along with all accrued and unpaid interest is due at maturity.

During the three and six months ended February 28,March 31, 2014, interest expense of $777 and $1,112, respectively, was recognized on outstanding notes payable. During the three and six months ended February 28, 2013, interest expense of $98 (of which $56 is for related parties)$9,829 was recognized on outstanding notes payable. As of February 28,March 31, 2014, accrued interest payable was $852,$9,829, which is included in accounts payable and accrued expenses on the accompanying condensed consolidated balance sheet.

Notes payable consisted of the following at February 28, 2014 and AugustMarch 31, 2013, respectively:2014:

On January 27, 2014, M. Richard Cutler and Cutler Law Group, P.C. (the “Plaintiffs”), the plaintiffs, filed a complaint in the District Court of Harris County, Texas, 2014-03355, against Fuse Medical, LLC, Alan Meeker, Rusty Shelton, Jonathan Brown, Robert H. Donehew and Golf Rounds.com, Inc. (the “Defendants”).  Plaintiff the Company, the defendants. The defendants believe the lawsuit to be completely without merit and, accordingly, filed a Motion to Dismiss on April 11, 2014. On April 21, 2014, the complaint was dismissed for "want of prosecution"; however, the case was reinstated by the court on June 13, 2014. The court has set a hearing on the Motion to Dismiss for July 25, 2014.

Richard Cutler is the sole principal of Plaintiffplaintiff Cutler Law Group, which provided legal representation to its client (“Cutler’s Client”) that was interested in merging intoengaging in a publicly traded corporation and attracting doctors as investors.  Plaintiffs allege that a proposed transaction between Cutler’s Client andwith Fuse Medical LLCand the Company (“Cutler’s Failed Transaction”),. The plaintiffs had alleged that Cutler's Failed Transaction failed to materialize notwithstanding the alleged efforts of Mr. Cutler and his law firm to document the transaction. PlaintiffsThe plaintiffs further allegehad alleged that subsequently, the Defendantsdefendants continued to pursue a similar transaction without Cutler’s Client or the Plaintiffs.plaintiffs. The Plaintiffs are claimingplaintiffs had claimed that the Defendants aredefendants were responsible for damages in the amount of:of (i) $46,465 plus interest because Plaintiffsplaintiffs were not paid their legal fees by Cutler’s Client nor did they receive equity in the company that Plaintiffsplaintiffs hoped would be issued from Cutler’s Failed Transaction; (ii) $46,465 plus interest due to Defendantdefendants being unjustly enriched from Plaintiffs’plaintiffs’ legal services to Cutler’s Client; (iii) $1,186,000 plus interest, being the alleged value of shares that Plaintiffsplaintiffs claimed to be entitled from Cutler’s Failed Transaction, which amount should allegedly be tripled as exemplary damages as a result of intentional fraud and/or negligent representations that some or all of the Defendantsdefendants allegedly committed and that such conduct allegedly constitutes conspiracy to commit fraud; (iv) $1,186,000, allegedly arising from a breach of a Non-Competition and Non-Disclosure Agreement to which Plaintiffsplaintiffs were not a party; (v) $1,000,000 for breach of fiduciary duty by the Defendantsdefendants because they would have been directors and officersofficer of the surviving corporation in Cutler’s Failed Transaction had it not failed and Defendants’defendants’ moving on to another transaction without Plaintiffs;plaintiffs; and (vi) Plaintiffs’plaintiffs’ attorneys fees and costs for bringing this action.  Defendants believe the lawsuit to be without merit and have retained counsel to vigorously defendhaving brought the action.  In addition, Defendant Robert H. Donehew is covered

Commencing January 1, 2013 through January 31, 2014, the Company occupied office space on a month-to-month basis for its corporate headquarters for $500 a month from Crestview Farm, an entity controlled by Directorsthe Company’s Chief Executive Officer (“CEO”). The Company's CEO serves as the Manager of Crestview Farm. Rent expense for these facilities was $500 and Officers Insurance policies.$1,500 for the three months ended March 31, 2014 and 2013, respectively (See Note 11).

The preparation of our condensed consolidated financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires us to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts of revenuerevenues and expense,expenses and the disclosurerelated disclosures of contingent assets and liabilities.liabilities in the financial statements and accompanying notes. The SEC has defined a company’s critical accounting policies as the ones that are most important to the portrayal of the company’s financial condition and results of operations, and which require the company to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. We evaluatebelieve that our estimates and assumptions on an ongoing basis. We base our estimates on historical experience and various other assumptions that we believe to beare 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. Actualcircumstances; however, actual results may differvary from these estimates under different assumptions or conditions.and assumptions. We believe that it is important for investorshave identified in Note 2 - “Significant Accounting Policies” to be aware that there is a particularly 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 fromcontained in this Report certain critical accounting policies that affect the actual value realized bymore significant judgments and estimates used in the recipientspreparation of the stock awards, and that the expenses recorded for stock-based compensation will not result in cash payments from Golf Rounds.com.financial statements.

Three months ended February 28, 2014 compared toFor the three months ended February 28, 2013

For the three months ended March 31, 2014, decreasedour cost of revenues was $58,823, compared to ($777) from ($98)$60,130 for the three months ended February 28, 2013.March 31, 2013, representing a decrease of $1,307 or 2.2%. The increasedecrease in interest expense to ($777) from ($98)cost of revenues was due to a decrease in the issuancenumber of $112,250units sold. Our cost of notes payable.revenues, on a per unit basis, did not change significantly during the three months ended March 31, 2014. Cost of revenues includes costs to purchase goods, transportation, storage, sales representatives and account management.

For the three months ended March 31, 2014, general, administrative and other operating expenses increased to $218,931 from $58,016 for the three months ended February 28,March 31, 2013, representing an increase of $160,915, or 277%. This increase is primarily attributable to costs associated with the closing of the reverse merger. In particular, legal and professional fees increased $93,210. In addition, salaries and wages increased $27,205. General, administrative and other operating expenses consisted primarily of legal and professional fees, salaries and wages, travel expenses, as well as other general and administrative expenses.

For the three months ended March 31, 2014, decreasedinterest expense increased to $18,377$10,392 from $24,372$238 for the three months ended February 28,March 31, 2013, a decreaserepresenting an increase of 24.6%$10,154, or 4,266%. The decrease wasInterest expense increased due to lower payroll expensesthe issuance of $7,391, legal expensesan aggregate of $3,368, office sharing expenses$840,577 of $2,700, and bank chargespromissory notes payable during the current period. Interest expense also includes interest on the Company’s line of $60, offset by higher directors and officers liability insurance expenses of $6,202, stockholder service expenses of $1,210 and taxes and license expenses of $112.credit.

For the three months ended March 31, 2014, the Company generated a net loss of ($125,880) compared to net income of $193,174 for the three months ended February 28, 2014 consisted of directors and officers liability insurance expenses of $8,077, legal expenses of $3,616, stockholder service expenses of $3,574, audit and accounting fee expenses of $2,750, taxes and license expenses of $221, payroll expenses of $109, and bank charges of $30.

AsThe Company maintains a $100,000 line of February 28, 2014, cash and cash equivalents were $6,551, which includes $74 invested incredit with Trinity Bank bearing interest of 2.25% per year, based on a 360-day year. The line of credit requires minimum monthly payments of interest only. The line of credit is secured by a money market account within the name of Dr. Christopher and Cesily Pratt maintained at Trinity Bank. Dr. Pratt is a yieldco-founder and Chief Medical Officer of 0.02%the Company. The balance due on the line of credit as of March 31, 2014 was $100,000 and $6,477 in a non-interest bearing checking account. Asis fully utilized. The line of February 28, 2014, there was a working capital deficiencycredit is due upon demand of $89,173.

Cash flows used in operating activitiesThe Company believes it currently has sufficient capital or access to capital to sustain its current operations for the six months ended February 28, 2014 of $89,250 stems from a net loss of $67,578, an increase in prepaid expenses of $7,973 and a decrease in accounts payable and accrued expenses of $13,699.

 

The notes are for a term of twenty-four (24) months, are unsecured, bear interest at 7.0% and require 18 monthly payments of interest only commencing at the beginning of month seven. The first six months of interest is deferred until maturity. The notes include a provision that in December 2012,the event of default the interest rate would increase to the default interest rate of 18%. The outstanding principal balance along with all accrued and unpaid interest is due at maturity.

For the three months ended March 31, 2014, the Company began financing its workinghad material capital requirements through saleexpenditures of its promissory notes$46,499. The Company has no material commitments for capital expenditures as of March 31, 2014.

As a “smaller reporting company” as defined by Item 10 of promissory notes to Fuse Medical, LLC.  The Company’s existence is dependent upon management’s ability to effect a business combination with Fuse Medical, LLC and/or obtain additional funding sources.  There can be no assurance that the Merger or the Company’s other financing efforts will result in profitable operations or the resolution of the Company’s liquidity problems.  The financial statements do not include any adjustments that might result shouldRegulation S-K, the Company be unableis not required to 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.provide this information.

The Company has no material contractual obligations other than those relating to employment as described in our Annual Report on Form 10-K for the year ended August 31, 2013 and the Agreement and Plan of Merger with Fuse Medical, LLC as described in this Quarterly Report on Form 10-Q.off-balance sheet arrangements.

Not applicable.Applicable.