ISSUER PURCHASES OF EQUITY SECURITIES
Market Price of our Common Stock.
The Company's common stock is traded on the over-the-counter bulletin board ("OTC-BB") under the symbol "GFME.OB"
At March 29, 2006 the Company had 3,289,006 shares of common stock outstanding, held by 54 shareholders of record. This does not reflect persons or entities that held their stock in nominee or "street" name. The following table sets forth the high and low bid quotations per share as reported by the OTC-BB for the periods stated. The quotations set forth below reflect inter-dealer prices, without retail mark-up, mark-down or commission, and may not necessarily represent actual transactions.


2004 Quarterly Period   High Bid   Low Bid First Quarter   $1.70   $1.25 Second Quarter   $1.62   $1.40 Third Quarter   $1.49   $1.20 Fourth Quarter   $1.40   $1.15 2005 Quarterly Period         First Quarter   $1.30   $1.21 Second Quarter   $1.21   $1.16 Third Quarter   $5.44   $1.01 Fourth Quarter   $5.10   $3.15
On March 29, 2006, the last sale price of our common stock on the OTC-BB was $ 3.64 per share.
Recent Sales of Unregistered Shares.
On August 15, 2005, as consideration for the assignment of certain trademarks and rights to the name, image, signature, voice, likenesses, caricatures, sobriquets, and all other identifying features and indicia of Mr. Foreman to Ventures, Foreman was issued membership interests in Ventures, which membership interests will be exchangeable into approximately thirty-five percent (35%), or 1,799,753 shares, of the fully-diluted shares of common stock of the Company. Additionally, a trust of which George Foreman, Jr. and George Foreman III are the trustees was issued shares of the Company's Series A Preferred Stock, which shares entitle the holders thereof, voting separately as a class, to elect two (2) members of the Board. The membership interests and the Series A Preferred Stock were issued in private transactions exempt from registration under the Securities Act of 1933, as amended, in reliance on Section 4(2) thereof. The membership interests are exchangeable, at Foreman's option, into shares of the Company's common stock at any time, or from time to time, on or after the date that is six (6) months after the date of issuance, at an exchange rate determined in accordance with the provisions of an investor rights agreement by and among the Company and Ventures, on the one hand, and Mr. Foreman and GFPI on the other hand.
Issuer Purchases of Equity Securities
None.

 
 
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the consolidated financial statements contained in Item 7 of this Form 10-KSB.
Results of Operations
Year Ended December 31, 2005 Compared to Year Ended December 31, 2004
The Company's net sales, cost of sales, sales and marketing expenses, operating and development expenses, and depreciation and amortization expense were zero for the years ended December 31, 2005 and 2004. This is attributable to the Company's cessation of its Internet-based custom CD marketing business while the Board continued to pursue the potential acquisition of other businesses. The Foreman transaction consummated in August of 2005 has yet to impact sales, or marketing, and development expenses.
General and administrative expenses were $10,196,533 for the year ended December 31, 2005, compared to $1,130,944 for the year ended December 31, 2004. General and administration expenses primarily consisted of professional fees, related expenses for marketing and accounting personnel and Directors and Officers insurance, as well as other general corporate expenses. The increase in general and administrative expenses was primarily due to the treatment of the membership interests in Ventures received by Mr. Foreman and GFPI, valued at $8,818,790. Payroll and related expenses increased by $259,000 in 2005 as a result of Mr. Holtzman, Mr. Foreman, Jr., Mr. Foreman III, Mr. Anderson and Mr. Huffsmith being hired on August 15 in connection with the Foreman transaction. At the same time, consulting fees to Jewelcor Management, Inc. were reduced from $21,500 to $4,167 per month. Consulting fees decreased from $146,000 in 2004 to $82,000. Legal fees increased by $301,000 due to fees related to the Foreman transaction. Insurance expense decreased from $249,000 in 2004 to $131,000 as a result of a reduction in Directors and Officers liability insurance premiums. Policy year premiums decreased from $192,500 for the year beginning July 1, 2004 to $70,000 for the year beginning July 1, 2005.
Interest and dividend income was $128,817 for the year ended December 31, 2005, compared to $70,562 for the year ended December 31, 2004. Other income was $235,489 for the year ended December 31, 2005, compared to $300,468 for the year ended December 31, 2004. Other income in 2005 consisted of realized gains on the sale of gold bullion of $235,489. Other income in 2004 consisted of realized gains on the sale of shares of LQ and Dynabazaar. The Company incurred an expense of $280,492 in 2005 as part of a negotiated settlement in connection with a dispute related to a lease agreement for 7,566 square feet of general office space located in New York City, which expires in February 2010.
Year Ended December 31, 2004 Compared to Year Ended December 31, 2003
The Company's net sales, cost of sales, sales and marketing expenses, operating and development expenses, and depreciation and amortization expense were zero for the years ended December 31, 2004 and 2003. This is attributable to the Company's cessation of its Internet-based custom CD marketing business while the Board continued to pursue the potential acquisition of other businesses.

 
General and administrative expenses were $1,130,944 for the year ended December 31, 2004, compared to $877,325 for the year ended December 31, 2003. General and administration expenses primarily consisted of professional fees, related expenses for accounting and administrative personnel and Directors and Officers insurance, as well as other general corporate expenses. Included in general and administrative expenses were significant legal fees related to potential acquisition candidates. Insurance expense decreased from $322,000 in 2003 to $249,000 as a result of a reduction in Directors and Officers liability insurance premiums. Policy year premiums decreased from $306,000 for the year beginning July 1, 2003 to $192,500 for the year beginning July 1, 2004. Directors fees increased to $58,000 in 2004 from $31,500 in 2003 due to a change on July 30, 2003 from a stock/option based compensation plan to a cash based compensation plan. Collection fees of $29,000 were incurred in 2004 in connection with the Rick Smith note receivable.
Interest and dividend income was $70,562 for the year ended December 31, 2004, compared to $238,943 for the year ended December 31, 2003. There was no dividend income in 2004: dividend income in 2003 included $190,318 related to the cash distribution from the Company's investment in LQ Corporation Inc. The LQ investment was sold in May 2004. Other income was $300,468 for the year ended December 31, 2004, compared to $903,253 for the year ended December 31, 2003. Other income in 2004 consisted of realized gains on the sale of shares of LQ and Dynabazaar as a result of the Securities Purchase Agreement. Other income in 2003 consisted of realized gains on the sale of gold bullion of$236,000, a gain relating to the cash distribution from the Company's investment in a limited liability company holding shares of common stock of Dynabazaar, Inc. of $418,000 and a recovery of a note receivable settlement of $250,000.
Critical Accounting Policies and Estimates
The SEC has recently issued Financial Reporting Release No. 60, "Cautionary Advice Regarding Disclosure About Critical Accounting Policies" ("FRR 60"), suggesting companies provide additional disclosure and commentary on those accounting policies considered most critical. FRR 60 considers an accounting policy to be critical if it is important to the Company's financial condition and results, and requires significant judgment and estimates on the part of management in its application as contemplated by FRR 60 based on our current state of operations. For a summary of all of the Company's significant accounting policies, including the accounting policies the Company believes to be critical, see Note 2 to the accompanying consolidated financial statements based on the Company's current activities.
Operating Lease Accruals
The Company has vacated possession of its premises subject to operating leases. See also