Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Feb. 28, 2014 | Mar. 25, 2014 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'GOLF ROUNDS COM INC | ' |
Entity Central Index Key | '0000319016 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 28-Feb-14 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--08-31 | ' |
Is Entity a Well-known Seasoned Issuer? | 'No | ' |
Is Entity a Voluntary Filer? | 'No | ' |
Is Entity's Reporting Status Current? | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 5,848,185 |
Document Fiscal Period Focus | 'Q2 | ' |
Document Fiscal Year Focus | '2014 | ' |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (Unaudited) (USD $) | Feb. 28, 2014 | Aug. 31, 2013 |
Current assets: | ' | ' |
Cash and cash equivalents | $6,551 | $801 |
Prepaid expenses | 18,673 | 10,700 |
Total current assets | 25,224 | 11,501 |
Total assets | 25,224 | 11,501 |
Current liabilities: | ' | ' |
Accounts payable and accrued expenses | 19,397 | 33,096 |
Notes payable, current portion | 95,000 | ' |
Total current liabilities | 114,397 | 33,096 |
Notes payable | 17,250 | 17,250 |
Total liabilities | 131,647 | 50,346 |
Stockholders' deficiency: | ' | ' |
Common stock, $0.01 par value; 12,000,000 shares authorized, 5,848,185 shares issued and outstanding, respectively | 58,481 | 58,481 |
Additional paid-in capital | 3,270,942 | 3,270,942 |
Accumulated deficit | -3,435,846 | -3,368,268 |
Total stockholders' deficiency | -106,423 | -38,845 |
Total liabilities and stockholders' deficiency | $25,224 | $11,501 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Feb. 28, 2014 | Aug. 31, 2013 |
Stockholders' deficiency: | ' | ' |
Common Stock Par Value | $0.01 | $0.01 |
Common Stock Shares Authorized | 12,000,000 | 12,000,000 |
Common Stock Shares Issued | 5,848,185 | 5,848,185 |
Common Stock Shares Outstanding | 5,848,185 | 5,848,185 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2014 | Feb. 28, 2013 | Feb. 28, 2014 | Feb. 28, 2013 | |
Expenses: | ' | ' | ' | ' |
General, administrative and other | $18,377 | $24,372 | $66,466 | $56,544 |
Total operating expenses | 18,377 | 24,372 | 66,466 | 56,544 |
Loss from operations | -18,377 | -24,372 | -66,466 | -56,544 |
Other income (expense): | ' | ' | ' | ' |
Interest expense | -777 | -98 | -1,112 | -98 |
Total other income (expense) | -777 | -98 | -1,112 | -98 |
Net loss | ($19,154) | ($24,470) | ($67,578) | ($56,642) |
Net loss per common share - basic and diluted | $0 | ($0.01) | ($0.01) | ($0.02) |
Weighted average number of common shares outstanding - basic and diluted | 5,848,185 | 3,567,377 | 5,848,185 | 3,567,377 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statement of Stockholders' Equity (Unaudited) (USD $) | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Total |
Beginning Balance, Amount at Aug. 31, 2013 | $58,481 | $3,270,942 | ($3,368,268) | ($38,845) |
Beginning Balance, Shares at Aug. 31, 2013 | 5,848,185 | ' | ' | ' |
Net loss | ' | ' | -67,578 | -67,578 |
Ending Balance, Amount at Feb. 28, 2014 | $58,481 | $3,270,942 | ($3,435,846) | ($106,423) |
Ending Balance, Shares at Feb. 28, 2014 | 5,848,185 | ' | ' | ' |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $) | 6 Months Ended | |
Feb. 28, 2014 | Feb. 28, 2013 | |
Cash flows from operating activities: | ' | ' |
Net loss | ($67,578) | ($56,642) |
Adjustments to reconcile net loss to net cash used in operating activites: | ' | ' |
Convertible notes issued for services rendered | ' | 5,250 |
Changes in operating assets and liabilities: | ' | ' |
(Increase) decrease in prepaid expenses | -7,973 | 3,750 |
Increase in accounts payable and accrued expenses | -13,699 | 37,462 |
Net cash used in operating activities | -89,250 | -10,180 |
Cash flows from financing activities: | ' | ' |
Proceeds from issuance of notes payable | 95,000 | ' |
Proceeds from related party for convertible notes | ' | 10,000 |
Net cash provided by financing activities | 95,000 | 10,000 |
Net increase (decrease) in cash and cash equivalents | 5,750 | -180 |
Cash and cash equivalents - beginning | 801 | 334 |
Cash and cash equivalents - ending | 6,551 | 154 |
Supplemental disclosure of cash flow information: | ' | ' |
Interest paid | 280 | ' |
Income taxes paid | ' | ' |
NATURE_OF_OPERATIONS_AND_BASIS
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | 6 Months Ended | |
Feb. 28, 2014 | ||
Notes to Financial Statements | ' | |
NOTE 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION | ' | |
(A) | Merger with Fuse Medical, LLC | |
On December 18, 2013, Golf Rounds.com, Inc. (the “Company”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Fuse Medical, LLC (“Fuse”), Project Fuse LLC, a wholly owned subsidiary of the Company (“Merger Sub”), and D. Alan Meeker, solely in his capacity as the representative of the Fuse members (the “Representative”). Upon consummation of the transactions contemplated by the Merger Agreement, Merger Sub will merge with and into Fuse, with Fuse surviving as a wholly owned subsidiary of the Company (the “Merger”). The Merger is expected to be completed during the third fiscal quarter of 2014. | ||
Fuse 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 has entered into partnership arrangements with physicians in order to distribute its products. | ||
In accordance with the Merger Agreement, on December 18, 2013, the Company obtained approval by written consent from the holders of 3,220,330 shares of its common stock, representing a majority of its outstanding common stock, to amend its certificate of incorporation, effective immediately prior to the consummation of the Merger, (i) to change the name of the Company to “Fuse Medical, Inc.”, (ii) to increase the Company’s 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 the board of directors of the Company 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 thereof and the qualifications, limitations or restrictions thereon, and (iii) to effect a 14.62 to 1 reverse stock split (the “Reverse Stock Split”). On March 4, 2014, the Company filed with the Securities and Exchange Commission (the “SEC”) a preliminary information statement on Schedule PRE 14C relating to the approval and adoption of the amendments (the “Preliminary Information Statement”). On March 13, 2014, the SEC notified the Company that the Preliminary Information Statement would be reviewed. Once the comments on the Preliminary Information Statement have been cleared by the SEC, the Company shall file a definitive information statement on Schedule DEF 14C relating to the adoption of the amendments (the “Definitive Information Statement”). The amendments will become effective no earlier than 20 days after the Definitive Information Statement is mailed to the Company’s stockholders. | ||
All of the units reflecting membership interests in Fuse that are issued and outstanding immediately prior to the effective time of the Merger shall be cancelled and converted into the right to receive 3,600,000 shares of the Company’s common stock (on a post-Reverse Stock Split basis), representing 90% of the Company’s issued and outstanding common stock after giving effect to the Merger (the “Merger Consideration”). The Merger Consideration will be allocated among the members of Fuse immediately prior to the effective time of the Merger (the “Holders”) in accordance with Fuse’s limited liability company operating agreement. | ||
In order to fund the indemnification obligations of the Holders after the closing of the Merger, of the shares of common stock constituting the Merger Consideration, 180,000 shares (on a post-Reverse Stock Split basis) will be deposited in escrow pursuant to the terms of the Merger Agreement and an escrow agreement, in the form attached to the Merger Agreement, to be executed at the closing. | ||
(B) | Interim Financial Statements | |
The accompanying unaudited 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 consolidated 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 2013 reflect all material 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. The Company believes that the disclosures are adequate to make the information presented not misleading. The condensed consolidated balance sheet information as of August 31, 2013 was derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on November 15, 2013. These condensed consolidated financial statements should be read in conjunction with the year-end audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended August 31, 2013. | ||
The results of operations for the three and six months ended February 28, 2014 and 2013 are not necessarily indicative of the results to be expected for the entire fiscal year or for any other period. | ||
(C) | Principles of Consolidation | |
The condensed consolidated financial statements include the accounts of Golf Rounds.com, Inc. and its wholly owned subsidiaries DPE Acquisition Corp. (formed on September 2, 2003) and Project Fuse LLC (formed on December 17, 2013). Intercompany transactions and accounts have been eliminated in consolidation. | ||
(D) | Loss Per Share | |
Diluted earnings per share reflects the potential dilution, using the treasury stock method, that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company. In computing diluted earnings per share, the treasury stock method assumes that our outstanding options are exercised and the proceeds are used to purchase common stock at the average market price during the period. Options will have a dilutive effect under the treasury stock method only when the average market price of the common stock during the period exceeds the exercise price of the options. | ||
As of February 28, 2014 and 2013, common stock equivalents include options to purchase 330,000 and 360,000 common shares, respectively. These instruments are not considered in the diluted loss per share because the effect would be anti-dilutive. | ||
(E) | Use of Estimates | |
In preparing condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the valuation of equity instruments at the date of the condensed consolidated financial statements. Actual results could differ from those estimates. | ||
(F) | Fair Value of Financial Instruments | |
The carrying amounts of certain financial instruments, including cash and cash equivalents, prepaid expenses, and accounts payable and accrued expenses approximate their fair values because of the short-term maturity of these instruments. | ||
(G) | Recent Accounting Pronouncements | |
There are recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the Securities Exchange Commission (the "SEC"); such pronouncements are not believed by management to have a material impact on the Company's present or future financial statements. | ||
GOING_CONCERN
GOING CONCERN | 6 Months Ended |
Feb. 28, 2014 | |
Notes to Financial Statements | ' |
NOTE 2. GOING CONCERN | ' |
The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not generated any revenues from operations since 2001 and has suffered recurring losses from its operations. During the six months ended February 28, 2014, the Company had a net loss of $67,578, used cash in operations of $89,250, and had no revenues from operations. As of February 28, 2014, the Company had an accumulated deficit of $3,435,846 and a working capital deficiency of $89,173. Currently, the Company’s working capital is not sufficient to last for more than 12 months. As a result, the Company’s independent registered public accounting firm, in its report on the Company’s August 31, 2013 consolidated financial statements, has raised substantial doubt about the Company’s ability to continue as a going concern. These factors among others indicate that the Company may be unable to continue as a going concern. The Company’s existence is dependent upon management’s ability to effect a business combination with a target business and/or obtain additional funding sources. Commencing in December 2012, the Company began financing its working capital requirements through sale of its promissory notes and convertible promissory notes. There can be no assurance that the Merger or 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. | |
In order to continue our operations and to make acquisitions, if any, under our current business model during the next twelve months, we will need to secure additional working capital, by way of debt or equity financing, or otherwise. We will need additional financing for working capital, and, in 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 proposed operations, and we may be unable to successfully promote our products or develop new or enhanced products or prosecute acquisitions, any 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. |
NOTES_PAYABLE
NOTES PAYABLE | 6 Months Ended | ||||||||
Feb. 28, 2014 | |||||||||
Notes to Financial Statements | ' | ||||||||
NOTE 3. NOTES PAYABLE | ' | ||||||||
On October 18, 2013, the Company issued a six-month promissory note to Fuse Medical, LLC due April 15, 2014 in exchange for cash proceeds of $39,000. The note is unsecured, bears interest at 3.0% and requires payment of principal and interest at maturity. | |||||||||
On November 4, 2013, the Company issued a six-month promissory note to Fuse Medical, LLC due May 5, 2014 in exchange for cash proceeds of $24,000. The note is unsecured, bears interest at 3.0% and requires payment of principal and interest at maturity. | |||||||||
On December 26, 2013, the Company issued a six-month promissory note to Fuse Medical, LLC due June 26, 2014 in exchange for cash proceeds of $32,000. The note is unsecured, bears interest at 3.0% and requires payment of principal and interest at maturity. | |||||||||
During the three and six months ended February 28, 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) was recognized on outstanding notes payable. As of February 28, 2014, accrued interest payable was $852, 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 August 31, 2013, respectively: | |||||||||
February 28, | August 31, | ||||||||
2014 | 2013 | ||||||||
Note payable to Fuse Medical, LLC - originating October 18, 2013; no periodic interest payments required; bearing interest at 3.0%; maturing at April 15, 2014 | $ | 39,000 | $ | - | |||||
Note payable to Fuse Medical, LLC - originating November 4, 2013; no periodic interest payments required; bearing interest at 3.0%; maturing at May 5, 2014 | 24,000 | - | |||||||
Note payable to Fuse Medical, LLC - originating December 26, 2013; no periodic interest payments required; bearing interest at 3.0%; maturing at June 26, 2014 | 32,000 | - | |||||||
Note payable - originating July 30, 2013; quarterly interest payments required; bearing interest at 3.25%; maturing at July 29, 2015 | 6,000 | 6,000 | |||||||
Note payable - originating August 29, 2013; quarterly interest payments required; bearing interest at 3.25%; maturing at August 28, 2015 | 11,250 | 11,250 | |||||||
Total | 112,250 | 17,250 | |||||||
Less: Current maturities | (95,000 | ) | - | ||||||
Amount due after one year | $ | 17,250 | $ | 17,250 |
STOCKHOLDERS_DEFICIT
STOCKHOLDER'S DEFICIT | 6 Months Ended | ||||||||||||||||
Feb. 28, 2014 | |||||||||||||||||
Notes to Financial Statements | ' | ||||||||||||||||
NOTE 4. STOCKHOLDERS' DEFICIENCY | ' | ||||||||||||||||
Stock Options | |||||||||||||||||
A summary of the Company’s stock option activity during the six months ended February 28, 2014 is presented below: | |||||||||||||||||
Weighted | |||||||||||||||||
Weighted | Average | ||||||||||||||||
Average | Remaining | Aggregate | |||||||||||||||
No. of | Exercise | Contractual | Intrinsic | ||||||||||||||
Shares | Price | Term | Value | ||||||||||||||
Balance outstanding at August 31, 2013 | 330,000 | $ | 0.68 | ||||||||||||||
Granted | - | ||||||||||||||||
Exercised | - | ||||||||||||||||
Forfeited | - | ||||||||||||||||
Expired | - | ||||||||||||||||
Balance outstanding at February 28, 2014 | 330,000 | $ | 0.68 | 1.7 | $ | - | |||||||||||
Exercisable at February 28, 2014 | 330,000 | $ | 0.68 | 1.7 | $ | - | |||||||||||
RELATED_PARTY_TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Feb. 28, 2014 | |
Notes to Financial Statements | ' |
NOTE 5. RELATED PARTY TRANSACTIONS | ' |
On March 1, 2000, the Company executed a month-to-month agreement to sub-lease office space and share office equipment and a bookkeeper’s time for $900 a month from R. D. Garwood, Inc. (“Garwood”). The Company’s President/Treasurer/Secretary is the Chief Financial Officer of Garwood. Effective June 1, 2013, due to the financial status of the Company, R.D. Garwood, Inc. began providing the aforementioned services at no charge to the Company. The Company’s expense for these shared facilities and bookkeeping services was $2,700 and $5,400 for the three and six months ended February 28, 2013. | |
During the three and six months ended February 28, 2014, the Company’s President provided services at no charge to the Company. During the three and six months ended February 28, 2013, the Company accrued salary for its President in the amount of $7,500 and $15,000, respectively, which is included in general and administrative expenses in the accompanying consolidated statements of operations. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Feb. 28, 2014 | |
Notes to Financial Statements | ' |
NOTE 6 - COMMITMENTS AND CONTINGENCIES | ' |
Legal Matters | |
On January 27, 2014, M. Richard Cutler and Cutler Law Group, P.C. (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 Richard Cutler is the sole principal of Plaintiff Cutler Law Group, which provided legal representation to its client (“Cutler’s Client”) that was interested in merging into a publicly traded corporation and attracting doctors as investors. Plaintiffs allege that a proposed transaction between Cutler’s Client and Fuse Medical, LLC (“Cutler’s Failed Transaction”), failed to materialize notwithstanding the alleged efforts of Mr. Cutler and his law firm to document the transaction. Plaintiffs further allege that, subsequently, the Defendants continued to pursue a similar transaction without Cutler’s Client or the Plaintiffs. The Plaintiffs are claiming that the Defendants are responsible for damages in the amount of: (i) $46,465 plus interest because Plaintiffs were not paid their legal fees by Cutler’s Client nor did they receive equity in the company that Plaintiffs hoped would be issued from Cutler’s Failed Transaction; (ii) $46,465 plus interest due to Defendant being unjustly enriched from Plaintiffs’ legal services to Cutler’s Client; (iii) $1,186,000 plus interest, being the alleged value of shares that Plaintiffs 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 Defendants 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 Plaintiffs were not a party; (v) $1,000,000 for breach of fiduciary duty by the Defendants because they would have been directors and officers of the surviving corporation in Cutler’s Failed Transaction had it not failed and Defendants’ moving on to another transaction without Plaintiffs; and (vi) Plaintiffs’ attorneys fees and costs for bringing this action. Defendants believe the lawsuit to be without merit and have retained counsel to vigorously defend the action. In addition, Defendant Robert H. Donehew is covered by Directors and Officers Insurance policies. |
NATURE_OF_OPERATIONS_AND_BASIS1
NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Policies) | 6 Months Ended |
Feb. 28, 2014 | |
Nature Of Operations And Basis Of Presentation Policies | ' |
Merger with Fuse Medical, LLC | ' |
On December 18, 2013, Golf Rounds.com, Inc. (the “Company”) entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Fuse Medical, LLC (“Fuse”), Project Fuse LLC, a wholly owned subsidiary of the Company (“Merger Sub”), and D. Alan Meeker, solely in his capacity as the representative of the Fuse members (the “Representative”). Upon consummation of the transactions contemplated by the Merger Agreement, Merger Sub will merge with and into Fuse, with Fuse surviving as a wholly owned subsidiary of the Company (the “Merger”). The Merger is expected to be completed during the third fiscal quarter of 2014. | |
Fuse 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 has entered into partnership arrangements with physicians in order to distribute its products. | |
In accordance with the Merger Agreement, on December 18, 2013, the Company obtained approval by written consent from the holders of 3,220,330 shares of its common stock, representing a majority of its outstanding common stock, to amend its certificate of incorporation, effective immediately prior to the consummation of the Merger, (i) to change the name of the Company to “Fuse Medical, Inc.”, (ii) to increase the Company’s 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 the board of directors of the Company 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 thereof and the qualifications, limitations or restrictions thereon, and (iii) to effect a 14.62 to 1 reverse stock split (the “Reverse Stock Split”). On March 4, 2014, the Company filed with the Securities and Exchange Commission (the “SEC”) a preliminary information statement on Schedule PRE 14C relating to the approval and adoption of the amendments (the “Preliminary Information Statement”). On March 13, 2014, the SEC notified the Company that the Preliminary Information Statement would be reviewed. Once the comments on the Preliminary Information Statement have been cleared by the SEC, the Company shall file a definitive information statement on Schedule DEF 14C relating to the adoption of the amendments (the “Definitive Information Statement”). The amendments will become effective no earlier than 20 days after the Definitive Information Statement is mailed to the Company’s stockholders. | |
All of the units reflecting membership interests in Fuse that are issued and outstanding immediately prior to the effective time of the Merger shall be cancelled and converted into the right to receive 3,600,000 shares of the Company’s common stock (on a post-Reverse Stock Split basis), representing 90% of the Company’s issued and outstanding common stock after giving effect to the Merger (the “Merger Consideration”). The Merger Consideration will be allocated among the members of Fuse immediately prior to the effective time of the Merger (the “Holders”) in accordance with Fuse’s limited liability company operating agreement. | |
In order to fund the indemnification obligations of the Holders after the closing of the Merger, of the shares of common stock constituting the Merger Consideration, 180,000 shares (on a post-Reverse Stock Split basis) will be deposited in escrow pursuant to the terms of the Merger Agreement and an escrow agreement, in the form attached to the Merger Agreement, to be executed at the closing. | |
Interim Financial Statements | ' |
The accompanying unaudited 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 consolidated 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 2013 reflect all material 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. The Company believes that the disclosures are adequate to make the information presented not misleading. The condensed consolidated balance sheet information as of August 31, 2013 was derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on November 15, 2013. These condensed consolidated financial statements should be read in conjunction with the year-end audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended August 31, 2013. | |
The results of operations for the three and six months ended February 28, 2014 and 2013 are not necessarily indicative of the results to be expected for the entire fiscal year or for any other period. | |
Principles of Consolidation | ' |
The condensed consolidated financial statements include the accounts of Golf Rounds.com, Inc. and its wholly owned subsidiaries DPE Acquisition Corp. (formed on September 2, 2003) and Project Fuse LLC (formed on December 17, 2013). Intercompany transactions and accounts have been eliminated in consolidation. | |
Loss Per Share | ' |
Diluted earnings per share reflects the potential dilution, using the treasury stock method, that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company. In computing diluted earnings per share, the treasury stock method assumes that our outstanding options are exercised and the proceeds are used to purchase common stock at the average market price during the period. Options will have a dilutive effect under the treasury stock method only when the average market price of the common stock during the period exceeds the exercise price of the options. | |
As of February 28, 2014 and 2013, common stock equivalents include options to purchase 330,000 and 360,000 common shares, respectively. These instruments are not considered in the diluted loss per share because the effect would be anti-dilutive. | |
Use of Estimates | ' |
In preparing condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the valuation of equity instruments at the date of the condensed consolidated financial statements. Actual results could differ from those estimates. | |
Fair Value of Financial Instruments | ' |
The carrying amounts of certain financial instruments, including cash and cash equivalents, prepaid expenses, and accounts payable and accrued expenses approximate their fair values because of the short-term maturity of these instruments. | |
Recent Accounting Pronouncements | ' |
There are recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the Securities Exchange Commission (the "SEC"); such pronouncements are not believed by management to have a material impact on the Company's present or future financial statements. |
NOTES_PAYABLE_Tables
NOTES PAYABLE (Tables) | 6 Months Ended | ||||||||
Feb. 28, 2014 | |||||||||
Notes Payable Tables | ' | ||||||||
Schedule of notes payable | ' | ||||||||
Notes payable consisted of the following at February 28, 2014 and August 31, 2013, respectively: | |||||||||
February 28, | August 31, | ||||||||
2014 | 2013 | ||||||||
Note payable to Fuse Medical, LLC - originating October 18, 2013; no periodic interest payments required; bearing interest at 3.0%; maturing at April 15, 2014 | $ | 39,000 | $ | - | |||||
Note payable to Fuse Medical, LLC - originating November 4, 2013; no periodic interest payments required; bearing interest at 3.0%; maturing at May 5, 2014 | 24,000 | - | |||||||
Note payable to Fuse Medical, LLC - originating December 26, 2013; no periodic interest payments required; bearing interest at 3.0%; maturing at June 26, 2014 | 32,000 | - | |||||||
Note payable - originating July 30, 2013; quarterly interest payments required; bearing interest at 3.25%; maturing at July 29, 2015 | 6,000 | 6,000 | |||||||
Note payable - originating August 29, 2013; quarterly interest payments required; bearing interest at 3.25%; maturing at August 28, 2015 | 11,250 | 11,250 | |||||||
Total | 112,250 | 17,250 | |||||||
Less: Current maturities | (95,000 | ) | - | ||||||
Amount due after one year | $ | 17,250 | $ | 17,250 |
STOCKHOLDERS_DEFICIT_Tables
STOCKHOLDER'S DEFICIT (Tables) | 6 Months Ended | ||||||||||||||||
Feb. 28, 2014 | |||||||||||||||||
Stockholders Deficit Tables | ' | ||||||||||||||||
Summary of the Company stock option activity | ' | ||||||||||||||||
A summary of the Company’s stock option activity during the six months ended February 28, 2014 is presented below: | |||||||||||||||||
Weighted | |||||||||||||||||
Weighted | Average | ||||||||||||||||
Average | Remaining | Aggregate | |||||||||||||||
No. of | Exercise | Contractual | Intrinsic | ||||||||||||||
Shares | Price | Term | Value | ||||||||||||||
Balance outstanding at August 31, 2013 | 330,000 | $ | 0.68 | ||||||||||||||
Granted | - | ||||||||||||||||
Exercised | - | ||||||||||||||||
Forfeited | - | ||||||||||||||||
Expired | - | ||||||||||||||||
Balance outstanding at February 28, 2014 | 330,000 | $ | 0.68 | 1.7 | $ | - | |||||||||||
Exercisable at February 28, 2014 | 330,000 | $ | 0.68 | 1.7 | $ | - | |||||||||||
NATURE_OF_OPERATIONS_AND_BASIS2
NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Details Narrative) | Feb. 28, 2014 | Feb. 28, 2013 |
Nature Of Operations And Basis Of Presentation Details Narrative | ' | ' |
Common stock including options to purchase | 330,000 | 360,000 |
GOING_CONCERN_Details_Narrativ
GOING CONCERN (Details Narrative) (USD $) | 3 Months Ended | 6 Months Ended | |||
Feb. 28, 2014 | Feb. 28, 2013 | Feb. 28, 2014 | Feb. 28, 2013 | Aug. 31, 2013 | |
Going Concern Details Narrative | ' | ' | ' | ' | ' |
Net loss | $19,154 | $24,470 | $67,578 | $56,642 | ' |
Net cash used in operating activities | ' | ' | 89,250 | 10,180 | ' |
Accumulated deficit | -3,435,846 | ' | -3,435,846 | ' | -3,368,268 |
Working capital deficiency | $89,173 | ' | $89,173 | ' | ' |
NOTES_PAYABLE_Details
NOTES PAYABLE (Details) (USD $) | Feb. 28, 2014 | Aug. 31, 2013 |
Notes Payable Details | ' | ' |
Note payable to Fuse Medical, LLC - originating October 18, 2013; no periodic interest payments required; bearing interest at 3.0%; maturing at April 15, 2014 | $39,000 | ' |
Note payable to Fuse Medical, LLC - originating November 4, 2013; no periodic interest payments required; bearing interest at 3.0%; maturing at May 5, 2014 | 24,000 | ' |
Note payable to Fuse Medical, LLC - originating December 26, 2013; no periodic interest payments required; bearing interest at 3.0%; maturing at June 26, 2014 | 32,000 | ' |
Note payable - originating July 30, 2013; quarterly interest payments required; bearing interest at 3.25%; maturing at July 29, 2015 | 6,000 | 6,000 |
Note payable - originating August 29, 2013; quarterly interest payments required; bearing interest at 3.25%; maturing at August 28, 2015 | 11,250 | 11,250 |
Total | 112,250 | 17,250 |
Less: Current maturities | -95,000 | ' |
Amount due after one year | $17,250 | $17,250 |
NOTES_PAYABLE_Details_Narrativ
NOTES PAYABLE (Details Narrative) (USD $) | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2014 | Feb. 28, 2013 | Feb. 28, 2014 | Feb. 28, 2013 | |
Notes Payable Details Narrative | ' | ' | ' | ' |
Interest expense | $777 | $98 | $1,112 | $98 |
Interest expense for related parties | ' | 56 | ' | ' |
Accrued interest payable | $852 | ' | $852 | ' |
STOCKHOLDERS_DEFICIT_Details
STOCKHOLDER'S DEFICIT (Details) (USD $) | 6 Months Ended |
Feb. 28, 2014 | |
Stockholders Deficit Details | ' |
Balance outstanding at August 31, 2013, No. Of Shares | 330,000 |
Granted, No. Of Shares | ' |
Exercised, No. Of Shares | ' |
Forfeited, No. Of Shares | ' |
Expired, No. Of Shares | ' |
Balance outstanding at February 28, 2014, No. Of Shares | 330,000 |
Exercisable at February 28, 2014, No. Of Shares | 330,000 |
Balance outstanding at August 31, 2013, Weighted Average Exercise Price | $0.68 |
Expired, Weighted Average Exercise Price | $0.68 |
Balance outstanding at February 28, 2014, Weighted Average Exercise Price | $0.68 |
Exercisable at February 28, 2014, Weighted Average Exercise Price | $0.68 |
Balance outstanding at February 28, 2014, Weighted Average Remaining Contractual Term | '1 year 8 months 12 days |
Exercisable at February 28, 2014, Weighted Average Remaining Contractual Term | '1 year 8 months 12 days |
Exercisable at February 28, 2014, Aggregate Intrinsic Value | ' |
Exercisable at February 28, 2014, Aggregate Intrinsic Value | ' |
RELATED_PARTY_TRANSACTIONS_Det
RELATED PARTY TRANSACTIONS (Details Narrative) (USD $) | 3 Months Ended | 6 Months Ended |
Feb. 28, 2013 | Feb. 28, 2013 | |
Related Party Transactions Details Narrative | ' | ' |
Expense for shared facilities and bookkeeping services | $2,700 | $5,400 |
Accrued Salary | $7,500 | $15,000 |