**U.
      S. SECURITIES AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**





**FORM
      10-KSB/A**


(Mark
      One)





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


For
      the
      fiscal year ended **April
      30, 2006**





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


For
      the
      transition period from ___________ to _____________





Commission
      File Number: **000-31032**





**AMERICAN
      SOUTHWEST MUSIC DISTRIBUTION, INC.**


f/k/a
      GL
      Energy & Exploration, Inc.





(Name
      of
      small business issuer as specified in its charter)





**Delaware**
            **52-2190362**(State
                or other jurisdiction of
              incorporation
                or organization)
            (I.R.S.
                Employer
              Identification
                No.)**8721
                Sunset Blvd., Penthouse 7**
              **Hollywood,
                California 90069**
              **________________________________________________________________________**
              (Address
                of principal executive offices, including zip
                code)




Registrant’s telephone number, including area
                code:
              **(310) 659-8770**Securities registered pursuant to
                Section
                12(b) of the Act:
              **None**Securities registered pursuant to
                Section
                12(g) of the Act:
              **$.001 par value common
                stock**


___________________


Check
      whether the issuer (1) filed all reports required to be filed by
      Section 13 or 15(d) of the Exchange Act of 1934 during the past 12 months
      (or for such shorter period that the registrant was required to file such
      reports), and (2) has been subject to such filing requirements for the past
      90 days.  Yes x No o




Check
      if
      disclosure of delinquent filers pursuant to Item 405 of Regulation S-B is not
      contained in this form, and no disclosure will be contained, to the best of
      registrant’s knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-KSB or any amendment
      to
      this Form 10-KSB. o





The
      issuer’s revenues for the most recent fiscal year were $0.





The
      aggregate market value of the voting and non-voting common equity held by
      non-affiliates of the registrant was approximately $379,078 as of August 8,
      2006. Shares of common stock held by each officer and director and by each
      person or group who owns 10% or more of the outstanding common stock amounting
      to 27,077,042 shares have been excluded in that such persons or groups may
      be
      deemed to be affiliates. This determination of affiliate status is not
      necessarily a conclusive determination for other purposes.





As
      of September 19, 2006, 8,922,933 shares of our common stock were issued and
      outstanding.





Documents
      Incorporated by Reference: None.





Transitional
      Small Business Disclosure Format: No.








**PART
      I**





**Item
      1. Description of Business**





**Overview**





American
      Southwest Music Distribution, Inc. f/k/a GL Energy & Exploration, Inc. (“we”
or the “Company”) was incorporated in the state of Delaware in 1998. Previously,
      the company engaged in the exploration of mining prospects in the western United
      States. As of January 1, 2006, we were a “shell” company (as defined in Rule
      12b-2 of the Exchange Act).





On
      March
      13, 2006, we entered into an agreement (the “Exchange Agreement”) pursuant to
      which we acquired all of the equity of American Southwest Music Distribution,
      Inc., a Texas corporation (“American”). Pursuant to the Exchange Agreement, we
      issued 22,500,000 shares of our common stock and 23,980 shares of our series
      A
      convertible preferred stock to David Michery and Kent Puckett, the sole
      shareholders of American. On August 18, 2006, we filed a certificate of
      amendment to our certificate of incorporation with the Delaware secretary of
      state changing our name to “American Southwest Music Distribution,
      Inc.”





As
      a
      result, our business is the business of American. American’s current
      business is the
      production, acquisition, marketing and sale of pre-recorded music. American’s
      pre-recorded music products will include releases of the new musical
      performances of recording artists, as well as compilations featuring various
      artists or repackaged releases of previously recorded music from our master
      music catalog and derived from licenses of music masters from third-parties.
      The
      exchange will be accounted for as a reverse acquisition. The accounting rules
      for reverse acquisitions require that, beginning with the date of the
      acquisition (March 13, 2006), our balance sheet include the assets and
      liabilities of American and our equity accounts be recapitalized to reflect
      the
      net equity of American. Accordingly, our historical operating results are now
      the operating results of American.





Our
      current executive offices are located at 8721 Sunset Blvd., Penthouse 7, West
      Hollywood, California 90069. Our telephone number is (310) 659-8770.





**Company
      History**





We
      produce, acquire, market and sell pre-recorded music through our wholly owned
      subsidiary, American. American was incorporated in the State of Texas in May
      2004. In July 2004, American acquired the assets of Celestial Breakaway Records’
and Out of Control Records’ music catalog, which consisted of rights to various
      master recordings previously released commercially. Pursuant to that
      acquisition, American procured the exclusive right to commercially market and
      sell those master recordings worldwide.





On
      October 13, 2004, American entered into that certain Agreement and Plan of
      Reorganization with the Company (the “Merger Agreement”), pursuant to which all
      of American’s outstanding shares were to be converted into shares of the
      Company’s capital stock, with the Company being the surviving corporation.
      Although the Merger Agreement was executed, certain closing conditions were
      never satisfied, including the filing of a certificate of merger with the
      Delaware Secretary of State and as such the merger was never consummated. The
      Board of Directors of both American and the Company deemed it in the best
      interest of their respective companies and shareholders to terminate the Merger
      Agreement and to enter into the Exchange Agreement.





On
      March
      13, 2006, American, their shareholders and the Company entered into the Exchange
      Agreement pursuant to which the Company issued an aggregate of 22,500,000 shares
      of its common stock and 23,980 shares of its series A convertible preferred
      stock to the American stockholders in exchange of their transfer of American
      shares to the Company.





American’s
      executive offices are located at 8721 Sunset Blvd., Penthouse 7, West Hollywood,
      California 90069. American’s telephone number is (310) 659-8770.




2




**Recent
      Developments**





Our
      Board
      of Directors approved an amendment to our certificate of incorporation (the
      “Charter Amendment”) to: (i) change our name to “American Southwest Music
      Distribution” and (ii) effectuate a reverse stock split of our common stock by
      changing and reclassifying each seventy four (74) shares of our issued and
      outstanding common stock, par value $.001 per share (“Common Stock”) into one
      (1) fully paid and non-assessable share of Common Stock (the “Reverse Split”). A
      majority of our stockholders approved the Charter Amendment by written consent
      on July 7, 2006. A notice of shareholder action by written consent was mailed
      to
      all stockholders of record as of July 7, 2006 informing them of this action
      on
      July 27, 2006. The Charter Amendment was filed with the Delaware Secretary
      of
      State on August 17, 2006. Nasdaq effectuated the name change and reverse split
      on Thursday August 24, 2006. Information in this Annual Report (other
      than our audited financial statements)has been adjusted to give effect
      to the Reverse Split.





**Our
      Business**





Our
      business is the production, acquisition, marketing and sale of pre-recorded
      music. Our pre-recorded music products will include releases of the new musical
      performances of recording artists, as well as compilations featuring various
      artists or repackaged releases of previously recorded music from our master
      music catalog and derived from licenses of music masters from third-parties.





Our
      expansion and exploitation of its music catalog is an integral part of its
      business and growth strategy. American owns a music catalog with 25 album
      masters, and intends to add to the music catalog through strategic and
      complementary acquisitions, licensing agreements, and by executing recording
      agreements with artists, production companies and other record labels with
      new
      recordings.





We
      will
      enter into rights acquisition, licensing, distribution and recording agreements
      ("Recording Agreements") with artists, third party record labels and production
      companies ("Labels") to provide us with master recordings that have not been
      previously released for sale to consumers ("New Masters"). Through each
      Recording Agreement, we will acquire the worldwide copyright and exclusive
      right
      to distribute and license music products derived from the New Masters that
      will
      be recorded and produced by the Labels, during the term of the Recording
      Agreement or any extension thereof. We will also acquire the exclusive right
      to
      record and market all New Masters of the recording artist(s) featured on any
      and
      all New Masters recorded by the Labels during the term of the Recording
      Agreements. We will also have the right to extend the term of the Recording
      Agreement through the exercise of multiple options pursuant to the terms of
      the
      Recording Agreements.





Most
      of
      our Recording Agreements will have an initial term and will usually have up
      separate, consecutive, irrevocable options, to renew the term for additional
      periods, at our sole discretion. As a condition of the initial term, and prior
      to exercising each option, we will be required to pay recoupable advances to
      the
      Label.





Pursuant
      each Recording Agreement, each Label will agree to deliver one or more New
      Masters to us during the term of the Recording Agreement. Each New Master will
      be required to contain at least twelve (12) newly recorded compositions of
      the
      featured recording artist(s), having an aggregate playing time of no less than
      forty (40) minutes ("Album”), and must be complete and satisfactory to us, in
      our managements’ sole discretion.





If
      an
      Album is satisfactory us, we will market and advertise the consumer release
      of
      the Album, and after the Label's delivery of an Album to us, we will
      commercially release the Album in the United States and Canada. Whether or
      when
      an Album is commercially released to consumers is within our sole discretion.
      The actual amount of money spent marketing an Album will be determined by us





Depending
      upon the initial success of any single, we will advance to the Label the costs
      to film and produce a music video featuring the single song selected by us.
      Pursuant to the terms of the Recording Agreement, we have the right to supervise
      and approve all elements of the music video. Once an acceptable music video
      is
      completed, we will use our efforts and pay third-party promoters to secure
      airplay of the music video on regional and national music video shows, as part
      of our marketing of the particular Album.





The
      marketing expenses we spend on any Album are variable, because the actual amount
      of expenditures for each Album will depend upon our management’s business
      judgment and discretion, about the commercial success (or lack thereof) of
      any
      Album, or the effectiveness of any Album’s marketing. At any point, we can elect
      to continue to or discontinue spending money to market any individual Album.
      If
      the Album realizes commercial success in the United States and Canada, the
      Album
      will be released in foreign territories.




3




Depending
      upon the terms of each Recording Agreement, we will pay each Label royalties
      from the net profits we actually receive from the sale of music products
      delivered during the term of the Recording Agreement. According to the terms
      of
      each Recording Agreement, we will only be required to pay royalties to a Label
      after we recoup all advances (we make to or on behalf of the Label) from Label’s
      percentage of net sales of all music products derived from the New Master(s)
      delivered by the subject Label.





*Contracts
      with Universal*





**Distribution
      Agreement**





On
      January 25, 2006, we entered into and Exclusive Manufacturing and Distribution
      Agreement (“Domestic Distribution Agreement”) with Universal Records, a division
      of UMG Recordings, Inc. (“Universal”). Pursuant to this Agreement, Universal
      will sell our music products, including compact discs, cassettes, and digital
      versatile discs (DVD) to consumers mainly through retailers and wholesalers
      in
      the United States and Canada. During the term of the Domestic Distribution
      Agreement, Universal will be our exclusive manufacturer and distributor, through
      every distribution channel of recorded music in the United States and Canada.
      Universal will also exclusively handle all of our on-line sales during the
      term
      of the Domestic Distribution Agreement.





In
      exchange for its distribution services, through normal retail channels,
      Universal is entitled to a distribution fee equal to twenty five percent (25%)
      of our Net Billings. After the end of the calendar month, where our cumulative
      Net Billings exceed $8,000,000, Universal’s distribution fee will be twenty two
      and one half percent (22.5%) of our Net Billings. After the end of the calendar
      month, in which our cumulative Net Billings exceeds $15,000,000, Universal’s
      distribution fee will be twenty percent (20%) of our Net Billings. According
      to
      the Domestic Distribution Agreement, Net Billings means the cumulative wholesale
      price for sale of our products, less actual returns and credits to customers
      for
      such returns for the applicable accounting period.





In
      consideration for Universal’s services related to sales of our products in the
      United States and Canada, through channels other than normal retail channels,
      Universal shall be entitled to a licensing fee equal to fifteen percent (15%)
      of
      our Net Licensing Billings. According to the Domestic Distribution Agreement,
      Net Licensing Billings mean royalties or flat payments received by Universal,
      on
      our behalf, attributed to sales, other than sales through normal retail
      channels.





At
      the
      end of the month, immediately following our first commercial release of a
      product pursuant to the Domestic Distribution Agreement, Universal will compute
      our Total Net Billings from the sale of American’s products, and Universal will
      compute such Total Net Billings, thereafter, on a calendar monthly basis. Sixty
      (60) days, after the close of each such monthly period, Universal will send
      us
      an accounting statement covering the Total Net Billings and the Net Proceeds
      payable to us. Along with each accounting statement, Universal will pay us
      the
      Net Proceeds realized by sales during the particular accounting period, if
      any,
      after deducting any taxes that Universal is required to withhold.





Under
      the
      terms of the Domestic Distribution Agreement, Total Net Billings means all
      Net
      Billings and Net Licensing Billings that Universal receives from the sale and
      licensing of our products. Net Proceeds mean Total Net Billings less the
      following:





§
            Universal’s
                applicable distribution fees and license
                fees;


§
            Reserves
                held, by Universal, against anticipated returns of our products;


§
            Universal’s
                charges for manufacturing and handling of our
                products;


§
            All
                Advances, if any, made by Universal on behalf of
                us;


§
            All
                applicable taxes imposed on Universal directly related to the manufacture
                and sale of our products;


§
            All
                co-op advertising costs advanced by Universal on our
                behalf;


§
            Universal’s
                charges for handling returns and refurbishing our
                products;


§
            Credits
                to Universal’s customers for actual returns of our
                products;


§
            Costs
                of any special program discounts or price reduction programs;
                and


§
            Any
                other amounts that Universal is entitled to
                receive.




4




To
      secure
      our payment of any fees, advances or monies that become due and payable to
      Universal, pursuant to the Domestic Distribution Agreement, we executed a
      security agreement, granting Universal a first position security interest in
      the
      following collateral:





§
            All
                master recordings contained solely on records actually distributed
                under
                the Domestic Distribution Agreement, and all contract rights and
                licenses
                relating to the master recordings;





§
            All
                sound recordings contained in the all master recordings contained
                solely
                on records actually distributed under the Domestic Distribution Agreement,
                and all copyrights to such sound
                recordings;





§
            Any
                derivatives or duplicates of all master recordings contained solely
                on
                records actually distributed under the Domestic Distribution
                Agreement;





§
            All
                proceeds derived from all master recordings contained solely on records
                actually distributed under the Domestic Distribution
                Agreement;





§
            Any
                and all monies which become payable to us under the Distribution
                Agreement;





§
            All
                inventory now owned or hereafter acquired by us and all proceeds
                of the
                sale or other disposition of the inventory;
                and





§
            Our
                names and logos used on records, including
                trademarks.





In
      addition to our obligations under the security agreement, David Michery,
      executed an inducement letter wherein he agreed that his active participation
      in
      the performance his duties as an employee is a vital part of the Domestic
      Distribution Agreement. In the event of his death or incapacity or in the event
      that David Michery ceases to be actively engaged in our management, in a
      controlling capacity, Universal will have the right to terminate the Domestic
      Distribution Agreement.





In
      addition to distributing and selling our products, Universal will supervise
      and
      advance the costs of all of American’s manufacturing, and will warehouse all of
      American’s inventory. The Domestic Distribution Agreement became effective
      January 25, 2006 and will continue until January 25, 2008. Universal has the
      right to extend the term of the Domestic Distribution Agreement for an
      additional two years, until January 25, 2010.





For
      each
      separate title of music products released, our management, along with Universal
      shall determine the applicable wholesale price per unit.





Under
      the
      Distribution Agreement, we are responsible for all recording costs and rights
      acquisition costs in securing all intellectual property rights and licenses
      necessary to allow us to sell records. We will be responsible for paying all
      marketing and promotion costs for each Album title that it releases
      commercially, and will be responsible to pay artist royalties and royalties
      related to all licenses related to the exploitation of the Album and its
      content.





**Upstream
      Agreement**





On
      January 25, 2006, we entered into another agreement with Universal, pursuant
      to
      which we granted Universal the right to enter into exclusive recording services
      contracts with recording artists that have recording contracts with us, and
      whose performances are featured on Albums, distributed by Universal, on our
      behalf, that achieve sales in the United States equal to or in excess of 25,000
      units (as reported by Soundscan) (“Upstream Agreement”).





Under
      the
      Upstream Agreement, Universal may exercise its rights to any recording artist,
      under contract with us, by providing us with written notice, at any time after
      we deliver an Album featuring the performances of the subject Artist, and ending
      on the date that Universal releases the Album to retail; or at any time during
      the period commencing on the date after the Album has been commercially released
      in the United States and has achieved sales in the United States equal to or
      in
      excess of twenty five thousand (25,000) units (as reported by Soundscan), and
      ending on the date such Album has achieved sales in the United States equal
      to
      fifty thousand (50,000) units. If, however, Universal does not exercise its
      rights under the Upstream Agreement for a particular Artist with sales exceeding
      50,000, we have an obligation to provide Universal with written notice that
      an
      Artist reached such sales levels, and Universal will have an additional thirty
      (30) days to exercise its right to the particular recording artist.




5




If
      Universal exercises its rights under the Upstream Agreement, we will enter
      into
      to a contract to provide the exclusive recording services of the selected Artist
      to Universal. Pursuant to the recording agreement and the Upstream Agreement,
      we
      will grant to Universal a fifty percent (50%) ownership interest in and to
      all
      Albums and related materials, relating to the selected artist, that exist prior
      to Universal’s exercise of its rights. Although we will retain an ownership
      interest in the such Masters, we lose our right to sell, transfer, grant,
      convey, assign, mortgage, pledge, hypothecate, or otherwise dispose of, or
      create any liens, encumbrances or security interests on any nature in respect
      to
      our rights to the existing master that become subject to Upstream
      Agreement.





On
      the
      first full calendar month following the date that Universal exercises its rights
      under the Upstream Agreement, if the sum of the advances, recording costs,
      marketing costs and promotion costs actually expended by us, on any existing
      Album that becomes subject to the Upstream Agreement, exceeds the total Net
      Proceeds credited to us in connection with the sale of such Album, Universal
      will pay us, as an advance against our future Net Profits under the recording
      agreement and the Upstream Agreement, fifty percent (50%) of our actual
      expenditures.





From
      the
      date that Universal receives its rights to any existing Album, Universal
      becomes, solely responsible for paying all artist royalties, third-party
      licensing fees and royalties, marketing, promotion and advertising costs related
      to the existing Album.





Under
      the
      Upstream Agreement, Universal grants us a fifty percent (50%) ownership interest
      in the copyright of each master subsequently recorded by the selected Artist,
      under the recording contract with Universal. Universal, however, has the
      exclusive and unlimited right to sell or license such masters, and we will
      not
      have the right to sell, transfer, grant, convey, assign, mortgage, pledge,
      hypothecate, or otherwise dispose of, or create any liens, encumbrances or
      security interests on any nature in respect to our rights to such
      masters.





For
      all
      subsequently recorded masters, Universal will be responsible for paying all
      recording costs and rights acquisition costs in securing all intellectual
      property rights and licenses necessary to allow Universal to sell Albums.
      Universal will, also, be responsible for paying all marketing and promotion
      costs for each Album title that it releases commercially, and will be
      responsible to pay artist royalties and royalties related to all licenses
      related to the exploitation of the Album and its content. According to the
      Upstream Agreement, Universal shall pay all advances, royalties and other monies
      payable directly to the particular Artist.





In
      consideration for the rights granted to Universal, under the Upstream Agreement,
      Universal agrees to pay us fifty percent (50%) of Universal’s Net Profits earned
      from the sale or other exploitation of any and all of the masters and Albums
      that are subject to the Upstream Agreement. According to the Upstream Agreement,
      Net Profits mean the amount equal to Gross Revenues less the
      Deductions.





Under
      the
      Upstream Agreement, Gross Revenue include:





§
            All
                monies actually received or credited to Universal from the sale of
                records
                in the United States minus reasonable reserves anticipated returns,
                actual
                returns and credits for returns, price discounts, and a distribution
                fee
                equal to twenty-five (25%) of United States Net Sales;





§
            One
                hundred percent (100%) of Universal’s Net Receipts in respect to
                licenses;





§
            Royalties
                of calculated at a basic rate of nineteen percent (19%) of the applicable
                Royalty Base Price for records sold through normal retail channels
                outside
                the United States by Universal’s direct and immediate principal foreign
                licensees; and





§
            Fifty
                percent (50%) net receipts received by Universal, with respect to
                licenses
                of masters outside the United States on flat-fee or other royalty
                basis.




6


Deductions
      are:





§
            A
                reserve for all reasonably anticipated future costs in connection
                with the
                particular Artist and/or masters recorded under the contract for
                anticipated marketing and promotions costs, recording costs, and
                music
                video costs; and





§
            All
                direct costs and expenses incurred by Universal.





Under
      the
      Upstream Agreement, Universal will prepare accounting statements for us on
      a
      semi-annual basis. On or before each September 30, or March 31, Universal will
      send such accounting statements to us for the semi-annual accounting period
      ending the immediately preceding June 30 th or
      December 31 st ,
      and
      will send American the amount of our share of any Net Profits, if any are then
      due and payable.





**Foreign
      License Agreement**





On
      January 25, 2006, we entered into the Exclusive Foreign License Agreement
      (“Foreign License Agreement”) with Universal. The term of the Foreign License
      Agreement runs simultaneously with the term of the Domestic Distribution
      Agreement. During the term of the Foreign License Agreement, Universal has
      the
      exclusive right to sell, license or otherwise exploit records and videos that
      its distributes under the Domestic Distribution Agreement through the rest
      of
      the Universe, excluding the United States.





In
      consideration of the rights granted, Universal agrees to pay us royalties on
      Net
      Sales. Under the Foreign License Agreement, Universal will prepare accounting
      statements for us on a semi-annual basis. On or before each September 30, or
      March 31, Universal will send such accounting statements to American for the
      semi-annual accounting period ending the immediately preceding June
      30 th or
      December 31 st ,
      and
      will send us the amount of our Royalties, if any, that are then due and payable.





**Competition**





The
      entertainment and recorded music industry is highly competitive. We face
      competition, from many other record companies, and from entertainment companies
      from other sectors of the entertainment industry (film and video games) for
      consumer household discretionary purchases of entertainment products. Record
      companies also compete for talented artists, producers and songwriters. Although
      there are many independent record labels, similar to American, three major
      record companies (BMG/Sony, Warner Music and Universal) currently control the
      distribution and market for pre-recorded music in the United States and around
      the world. Many of these record companies have significantly longer operating
      histories, greater financial resources, assets and larger music catalogs, and
      larger staffs than us. Our ability to compete in this industry depends on many
      factors, including but not limited to:





§
            Our
                management’s and employees’ creativity, skills and relationships with
                artists, promoters, radio stations, distributors and
                retailers;





§
            Our
                ability to sign Recording Agreements to secure new artists and Masters,
                and to expansion its music catalog;





§
            Our
                ability to effectively market and sell its music products;
                and





§
            Our
                ability to establish, and maintain a reputation for commercially
                releasing
                high quality music products.





**Employees**





As
      of
      August 8, 2006, we currently have 7 employees, and 6 are full-time. None of
      our
      employees are represented by a labor union and we have not entered into a
      collective bargaining agreement with any union. We have not experienced any
      work
      stoppages and consider our relations with our employees to be good.





7


**Item
      1A. Risk Factors and Cautionary Statement Regarding Forward-Looking
      Information**





An
      investment in our common stock involves a high degree of risk. You should
      carefully consider the following risk factors and the other information in
      this
      annual report before investing in our common stock. Our business and results
      of
      operations could be seriously harmed by any of the following risks. The trading
      price of our common stock could decline due to any of these risks.





**Risks
      Associated with our Business**





**There
      is substantial doubt about our ability to continue as a going
      concern.**





We
      incurred recurring net losses totaling $2,071,520 for the period from inception
      (July 1, 2004) through April, 30, 2006. As of April 30, 2006 we have an
      accumulated deficit of $3,465,741 and a working capital deficit of $2,300,702.
      These conditions raise substantial doubt about our ability to continue as a
      going concern. Management's plans in this regard are to raise equity or
      loan financings as required. There are no assurances that we will be successful
      in this regard.





**We
      are a development stage company, and we have no significant operating history.**





We
      are a
      development stage company that has not had operations for many years. Our plans
      and businesses are “proposed” and “intended” but we may not be able to
      successfully implement them. Our primary business is the production,
      acquisition, marketing and sale of pre-recorded music. However, we have not
      yet
      released a music product and have not earned any revenues and have incurred
      losses since our incorporation. To date, our management’s efforts have been
      limited to organizational activities, business planning and seeking initial
      funding. We currently lack sufficient capital to generate revenue or operate
      our
      business in a profitable manner. As a development stage company, our prospects
      are subject to all the risks and uncertainties frequently encountered by
      companies in the music industry. In addition, we are subject to all of the
      risks, uncertainties, expenses, delays, problems, and difficulties typically
      encountered in the establishment of a new business. We expect that unanticipated
      expenses, problems, and technical difficulties will occur and that they will
      result in material delays in the development of our business. We may not obtain
      sufficient capital or achieve a significant level of operations and, even if
      we
      do, we may not be able to conduct such operations on a profitable
      basis.





**We
      have limited financial resources which if not corrected will prevent and inhibit
      our ability to implement its business plan.**





We
      have
      limited financial resources and have not generated any revenues to date. We
      cannot achieve revenues until we release and market new records from our catalog
      or from new musical performances of recording artists pursuant to Recording
      Contracts with those recording artists, their production companies or record
      labels. To secure new Recording Contracts requires us to pay substantial
      advances to the recording artists, their production companies or record labels.
      Prior to and concurrent with any commercial release of a new music product
      requires us to pay substantial marketing costs and consultant fees related
      to
      the marketing of the product. To begin generating revenues, we must have
      substantial funding. There can be no assurance that we will raise sufficient
      funds to release its music products, and therefore no assurances that we will
      receive any revenues from its operation, nor operate on a profitable basis.





**We
      may not be able to find music products with mass consumer acceptance and we
      cannot predict sales revenues from the release of music
      products.**





Although
      we will attempt to locate and secure Recording Agreements with record labels,
      production companies, producers, and recording artists, the record industry
      is
      very competitive, there is no assurance that we will secure contracts with
      talented record labels, production companies, producers, and recording artists.
      Although we may secure Recording Agreements, the music products derived from
      the
      master recordings delivered pursuant to those Recording Agreements and the
      compilation albums derived from American’s music catalog may not receive mass
      consumer appeal and may not generate significant sales revenues despite our
      marketing efforts and expenditures. The sale of recorded music products to
      consumers is entirely speculative, and there is no way to assure the amount
      of
      music products that will be sold from any of our commercial releases of its
      music products.




8




**We
      may not be able to obtain sufficient capital to implement our business
      plan.**





To
      successfully implement our business plan, we need access to capital. Our ability
      to implement our business plan will be limited unless we are able to obtain
      capital through additional debt or equity financing. We cannot assure that
      such
      debt or equity financing will be obtained or that, if obtained, such financing
      will be on terms that are favorable to us or sufficient for our needs. If we
      are
      unable to obtain sufficient financing, we may be unable to fully implement
      our
      business plan, and we may be required to limit or discontinue our operations.





**Acquisitions
      involve risks that could cause our actual growth to differ from our expectations
      and lower the market price for our common stock**





While
      we
      are not currently a party to any agreements regarding any material acquisitions,
      we expect to continue to seek to acquire master recordings, music publishing
      rights and other record companies. Acquisitions involve risks that could cause
      our actual growth to differ from our expectations. For example:




§
            We
                may not be successful in identifying attractive acquisitions. We
                compete
                with other companies to acquire master recordings, music publishing
                rights
                and other record companies. We expect that this competition will
                continue,
                which may inhibit our ability to complete suitable acquisitions on
                favorable terms.


§
            We
                may be unable to successfully integrate acquired businesses and realize
                anticipated economic, operational and other benefits in a timely
                manner.
                If we are unable to successfully integrate acquired businesses, product
                lines and personnel, we may incur substantial costs and delays or
                other
                operational, technical or financial problems. In addition, efforts
                to
                integrate or failure to successfully integrate acquisitions may divert
                management's attention from our existing business and may damage
                our
                relationships with our key employees and customers.





**The
      recorded music industry is highly competitive, and we cannot assure the success
      of our individual products, or the overall success of our business
      plan.**





The
      recorded music industry is highly competitive. We face competition for
      discretionary consumer purchases of our products from other record companies
      and
      other entertainment companies, such as film and video companies. Many of these
      competitors have greater financial and other resources, larger development
      staffs, and more effective marketing organizations than we do. In the United
      States three record companies control eighty percent (80%) of record sales:
      Warner Music Group, Universal Music Group, and Sony Music Entertainment/BMG.
      Independent record companies generate the balance of record sales. Our ability
      to compete in this market depends largely on:





§
            The
                skill and creativity of our employees and their relationships with
                artists;


§
            Our
                ability to sign new and established artists and songwriters;


§
            The
                expansion and utilization of our music catalog;


§
            The
                acquisition of licenses to enable us to create compilation packages;


§
            The
                effective and efficient distribution our products; and


§
            Our
                ability to build and maintain a reputation for producing, licensing,
                acquiring, marketing and distributing high quality music.





**Since
      we are in a creative industry, we may be able to generate sufficient revenues
      from successful releases to exceed the costs of unsuccessful product
      releases.**





The
      recorded music industry, like other creative industries, involves a substantial
      degree of risk. Each recording is an individual artistic work, and its
      commercial success is primarily determined by consumer taste, which is
      unpredictable and constantly changing. As a result, we cannot assure the
      financial success of any particular release, the timing of success or the
      popularity of any particular artist. We may be unable to generate sufficient
      revenues from successful releases to cover the costs of unsuccessful releases.




9




**Delays
      in the delivery of new master records by third-party labels could materially
      adversely affect our business, financial results, and operating
      results.**





The
      timing of releases of New Records may materially affect our business, financial
      condition and results of operations. To secure New Records for release and
      sale
      to consumers, we will enter into Distribution Agreements with third party
      Labels. Pursuant to these Distribution Agreements, the third party Labels agree
      to deliver to us commercially satisfactory master recordings that have not
      been
      previously released for sale to consumers. Our results of operations are subject
      to seasonal variations. In particular, our revenues and operating income are
      affected by end-of-the-year holiday sales. In accordance with industry practice,
      we record revenues for music products when the products are shipped to
      retailers. In anticipation of holiday sales, retailers purchase products from
      us
      prior to December. As a result, our revenues and operating income typically
      decline during December, January and February. If releases planned for the
      peak
      holiday season are delayed, our business, financial results and operating
      results could be materially adversely affected.




**If
      we experience higher than expected returns, our financial condition could be
      materially and adversely affected.**





Our
      products are sold on a returnable basis, which is standard music industry
      practice. We set reserves for future returns of products estimated based on
      return policies and experience. We expect that our actual return experience
      will
      be within standard industry parameters. However, we may experience an increase
      in returns over our established reserves. If this occurs our business, results
      of operations and financial condition could be materially and adversely
      affected.





**Losses
      of Key Personnel could materially and adversely affect our business, financial
      condition or results of operations.**





Our
      success depends largely on the skills, experience and efforts of our executive
      officers and key employees, especially our Chairman and Chief Executive Officer,
      David Michery. The loss of the services of Mr. Michery or other members of
      our
      senior management, could materially adversely affect our business, financial
      condition or results of operations. In addition, in large part, our success
      will
      depend on our ability to attract and retain qualified management, marketing
      and
      sales personnel. We experience competition for qualified personnel with other
      companies and organizations. Our inability to hire or retain qualified personnel
      could have a material adverse effect on our business, financial condition or
      results of operations.





**We
      may not manage our growth properly.**





We
      intend
      to grow in the future, and our growth presents numerous challenges and places
      significant additional pressure on our managerial, financial and other
      resources. To manage such growth it is necessary that we continue to implement
      and improve our operating systems, attract and train more qualified personnel,
      integrate acquired businesses and products, and expand our facilities. If we
      fail to effectively manage our growth, our business, operating results or
      financial condition could be materially adversely affected.





**Our
      operations are seasonal.**





Our
      results of operations are subject to seasonal variations. In particular, our
      revenues and operating income are affected by end-of-the-year holiday sales.
      In
      accordance with industry practice, we record revenues for music products when
      the products are shipped to retailers. In anticipation of holiday sales,
      retailers purchase products from us prior to December. As a result, our revenues
      and operating income typically decline during December, January and February.
      In
      addition, timing of a new release may materially affect our business, financial
      condition and results of operations. For example, if releases planned for the
      peak holiday season are delayed, our business, financial results and operating
      results could be materially adversely affected.





**We
      are dependent on third parties for certain licensing
      rights.**





We
      license the rights to numerous master recordings and compositions from third
      parties for recording and re-recording of music to produce compilations and
      to
      expand of our catalog. We also seek to license the rights to our master
      recordings and compositions to third parties for use in albums for a royalty
      or
      a flat fee. These cross-licensing arrangements are generally made possible
      by
      existing industry practices based on reciprocity. If these practices change,
      we
      cannot assure that we will be able to obtain licenses from third parties on
      satisfactory terms, or at all, and our business, financial condition and
      operating results, particularly with respect to compilation products, could
      be
      materially and adversely affected.




10




**If
      David Michery dies or becomes incapacitated or in the event that he ceases
      to be
      actively engaged in management, in a controlling capacity, Universal will have
      the right to terminate the Domestic Distribution
      Agreement.**





Our
      Exclusive Manufacturing and Distribution Agreement with Universal is a material
      contract to our current and future operations (see “Business - Contracts with
      Universal”). Pursuant to the terms of the Domestic Distribution Agreement, David
      Michery’s active and full time participation in our business affairs is
      required. In the event of his death or incapacity or in the event that he
      ceases, for whatever reason to be actively engaged in our management in a
      controlling capacity, Universal has the right, without liability of any kind
      to
      us whatsoever, to terminate the Domestic Distribution Agreement. Currently,
      this
      is our only agreement in place, and its termination would have a material effect
      on our business, financial condition and operating results.





**Risks
      Associated with Investing in our Common Stock**





**There
      is a limited trading market for our common stock.**





Our
      common stock is traded on the OTC Bulletin board under the symbol “ASWD.OB.”
There has been virtually no trading activity in our stock recently, and when
      it
      has traded, the price has fluctuated widely. We consider our common stock to
      be
“thinly traded” and any last reported sale prices may not be a true market-based
      valuation of the common stock. A consistently active trading market for our
      stock may not develop at any time in the future. Stockholders may experience
      difficulty selling their shares if they choose to do so because of the illiquid
      market and limited public float for our stock. It is possible that even
      a
      limited public market for our common stock will not be sustained after the
      date
      of this annual report or at a time at which you may desire to sell your shares.





**The
      volatility of our stock price affect our may adversely affect the market price
      for our common stock.**





The
      market price of our common stock has historically been volatile. We believe
      the
      market price of the common stock could continue to fluctuate substantially,
      based on a variety of factors, including quarterly fluctuations in results
      of
      operations, timing of product releases, announcements of new products and
      acquisitions or acquisitions by our competitors, changes in earnings estimates
      by research analysts, and changes in accounting treatments or principles. The
      market price of our common stock may be affected by our ability to meet or
      exceed analysts' or "street" expectations, and any failure to meet or exceed
      such expectations could have a material adverse effect on the market price
      of
      our common stock. Furthermore, stock prices for many companies, particularly
      entertainment companies, fluctuate widely for reasons that may be unrelated
      to
      their operating results. These fluctuations and general economic, political
      and
      market conditions, such as recessions or international currency fluctuations
      and
      demand for our products, may adversely affect the market price of our common
      stock.





**Our
      common stock is considered to be a “penny stock” and, as such, the market for
      our common stock may be further limited by certain SEC rules applicable to
      penny
      stocks.**





As
      long
      as the price of our common stock remains below $5.00 per share or we have net
      tangible assets of $2,000,000 or less, our shares of common stock are likely
      to
      be subject to certain “penny stock” rules promulgated by the SEC. Those rules
      impose certain sales practice requirements on brokers who sell penny stock
      to
      persons other than established customers and accredited investors (generally
      institutions with assets in excess of $5,000,000 or individuals with net worth
      in excess of $1,000,000). For transactions covered by the penny stock rules,
      the
      broker must make a special suitability determination for the purchaser and
      receive the purchaser’s written consent to the transaction prior to the sale.
      Furthermore, the penny stock rules generally require, among other things, that
      brokers engaged in secondary trading of penny stocks provide customers with
      written disclosure documents, monthly statements of the market value of penny
      stocks, disclosure of the bid and asked prices and disclosure of the
      compensation to the brokerage firm and disclosure of the sales person working
      for the brokerage firm. These rules and regulations make it more difficult
      for
      brokers to sell our shares of our common stock and limit the liquidity of our
      securities.




11




**We
      do not expect to pay dividends for the foreseeable future.**





For
      the
      foreseeable future, it is anticipated that earnings, if any, that may be
      generated from our operations will be used to finance our operations and that
      cash dividends will not be paid to holders of our common stock.





**Any
      projections used in this report may not be accurate** .





Any
      and
      all projections and estimates contained in this report or otherwise prepared
      by
      us are based on information and assumptions which management believes to
      be
      accurate; however, they are mere projections and no assurance can be given
      that
      actual performance will match or approximate the projections.





**Because
      stock ownership is concentrated, you and other investors will have minimal
      influence on stockholders’ decisions.**




Assuming
      that issued and outstanding warrants and options for our common stock have
      not
      been exercised, our executive officers and/or their affiliated companies
      directly or beneficially own approximately 93% of our outstanding common stock
      (on a fully converted basis) as of August, 2006. As a result our executive
      officers may be able to significantly influence the management of the company
      and all matters requiring stockholder approval, including the election of
      directors. Such concentration of ownership may also have the effect of delaying
      or preventing a change in control of our company.





**Our
      directors and executive officers control the company.**





Our
      directors, executive officers and/or their affiliated companies directly or
      beneficially own approximately 93% of our outstanding common stock (on a fully
      converted basis). Accordingly, these persons, as a group, may be able to exert
      significant influence over the direction of our affairs and business, including
      any determination with respect to our acquisition or disposition of assets,
      future issuances of common stock or other securities, and the election of
      directors. Such a concentration of ownership may also have the effect of
      delaying, deferring, or preventing a change in control of the company.





**Substantial
      sales of our stock may impact the market price of our common stock.**




Future
      sales of substantial amounts of our common stock, including shares that we
      may
      issue upon exercise of options and warrants, could adversely affect the market
      price of our common stock. Further, if we raise additional funds through the
      issuance of common stock or securities convertible into or exercisable for
      common stock, the percentage ownership of our stockholders will be reduced
      and
      the price of our common stock may fall.




**Issuing
      preferred stock with rights senior to those of our common stock could adversely
      affect holders of common stock.**




Our
      charter documents give our board of directors the authority to issue series
      of
      preferred stock without a vote or action by our stockholders. The board also
      has
      the authority to determine the terms of preferred stock, including price,
      preferences and voting rights. The rights granted to holders of preferred stock
      may adversely affect the rights of holders of our common stock. For example,
      a
      series of preferred stock may be granted the right to receive a liquidation
      preference - a pre-set distribution in the event of a liquidation - that would
      reduce the amount available for distribution to holders of common stock. In
      addition, the issuance of preferred stock could make it more difficult for
      a
      third party to acquire a majority of our outstanding voting stock. As a result,
      common stockholders could be prevented from participating in transactions that
      would offer an optimal price for their shares.





12





**Cautionary
      Statement Concerning**


**Forward-Looking
      Statements**





Some
      of
      the statements in this annual report are forward looking statements, which
      are
      subject to risks and uncertainties. These risks and uncertainties could cause
      actual results to differ materially from those expressed in forward-looking
      statements. We base these forward-looking statements on our expectations and
      projections about future events, which we derive from the information currently
      available to us. Such forward-looking statements relate to future events or
      our
      future performance. Forward-looking statements are only predictions. The
      forward-looking events discussed in this annual report, the documents to which
      we refer you and other statements made from time to time by us or our
      representatives, may not occur, and actual events and results may differ
      materially and are subject to risks, uncertainties and assumptions about us.
      For
      these statements, we claim the protection of the “bespeaks caution” doctrine.
      The forward-looking statements speak only as of the date hereof, and we
      expressly disclaim any obligation to publicly release the results of any
      revisions to these forward-looking statements to reflect events or circumstances
      after the date of this filing.




13


**Item
      2. Description of Property**





Our
      executive office is located at 8721 Sunset Blvd., Penthouse 7, West Hollywood,
      California 90069, telephone (310) 659-8770. We have a two-year lease that began
      on November 2005 and expires on October 31, 2007 for which we pay $1,685 per
      month. Other than the office in West Hollywood, California, we do not currently
      maintain any other office facilities. We plan to open an office in Houston,
      Texas in the next 12 months. We believe there is an adequate supply of suitable
      office space for lease on terms acceptable to us.




**Item
      3. Legal Proceedings**





In
      May
      2005, Vestcom, Ltd. filed suit against us, our officers, and several other
      unrelated companies including AMC American Music Corporation. The lawsuit arose
      from a loan made by Vestcom on or about July 3, 2003 in the amount of $500,000
      to AMC American Music Corporation. Vestcom alleged that AMC American Music
      Corporation fraudulently transferred its assets (“Subject Assets”) to Celestial
      Breakaway Records, which is owned and controlled by our President, David
      Michery, and/or us. We contended that none of its assets belonged previously
      to
      AMC American Music Corporation.





Vestcom,
      Ltd. was seeking not less than $1.2 million from all the defendants including
      us, to be awarded ownership of all Subject Assets, punitive damages, and other
      remuneration.





We
      have
      entered a stipulation for Settlement/Term Sheet in the action entitled Vestcom
      v. AMC; Case No. CV-04-03745, which is expected to close on or about September
      15, 2006. Pursuant to the stipulation, American agreed to pay Vestcom the
      damages Vestcom alleges to have incurred in the above referenced action equal
      to
      the sum of $500,000 plus interest thereon at a rate of 9.5% from July 3, 2003
      through the expected Closing Date, $360,000 as a supplemental damages payment
      and $250,000 for legal fees and expenses of Vestcom. Assuming a September 15,
      2006 closing, the principal amount will equal $1,300,000 (the “Principal
      Amount”). On the Closing Date, we will issue Vestom a 9.5% promissory note for
      the Principal Amount, which note will be payable as follows: $150,000 payable
      on
      the Closing Date, $250,000 payable on or before January 1, 2007, and the balance
      to be paid in 8 equal installments paid quarterly beginning April 3,
      2007.





The
      note
      will be convertible into shares of our common stock at 90% of the average bid
      price for the five (5) days immediately prior to conversion, subject to certain
      limitations. The note will be secured by our assets as well as a pledge of
      a
      certain amount of David Michery’s shares. We have agreed to register the shares
      of common stock underlying the note




**Item
      4. Submission of Matters to a Vote of Security Holders**





No
      matters were submitted to a vote of shareholders in the fourth quarter of the
      fiscal year ended April 30, 2006.





14




**PART
      II**





**Item
      5. Market for Common Equity and Related Stockholder
      Matters**




Beginning
      August 24, 2006, in connection with our name change, our common stock trades
      on
      the OTC Bulletin Board under the symbol “ASWD.OB.” Previously, our common stock
      traded on the OTC Bulletin Board under the symbol “GEEX.OB.” The following table
      shows the high and low bid or close prices for our common stock for each quarter
      since May 1, 2004 as reported by the OTC Bulletin Board. We consider our stock
      to be “thinly traded” and any reported sale prices may not be a true
      market-based valuation of the stock. All share prices have been adjusted to
      provide for a 1-for-74 reverse stock spit effected on August 24, 2006. Some
      of the bid quotations from the OTC Bulletin Board set forth below may reflect
      inter-dealer prices, without retail mark-up, mark-down or commission and may
      not
      represent actual transactions.




May
                  1, 2005 to April 30, 2006
              High
                  Close
              Low
                  CloseFirst
                  quarter
              $
                  7.40
              $
                  2.22Second
                  quarter
              4.81
              1.56Third
                  quarter
              3.70
              1.48Fourth
                  quarter
              2.22
              0.74May
                  1, 2004 to April 30, 2005
              High
                  Bid
              Low
                  BidFirst
                  quarter
              $
                  1.48
              $
                  0.30Second
                  quarter
              1.33
              0.52Third
                  quarter
              4.07
              0.67Fourth
                  quarter
              2.96
              0.89




As
      of
      August 8, 2006, there were approximately 26 record holders of our common
      stock.





We
      have
      not paid any cash dividends since our inception and do not contemplate paying
      dividends in the foreseeable future. It is anticipated that earnings, if any,
      will be retained to retire debt and for the operation of the
      business.





Shares
      eligible for future sale could depress the price of our common stock, thus
      lowering the value of a buyer’s investment. Sales of substantial amounts of
      common stock, or the perception that such sales could occur, could adversely
      affect prevailing market prices for shares of our common stock.





**Securities
      Authorized for Issuance Under Equity Compensation Plans.** The
      following provides information concerning compensation plans under which our
      equity securities are authorized for issuance as of April 30, 2006 (on a
      adjusted basis for the Reverse Split): ****


**(a)**
            
            **(b)**
            
            **(c)****Plan
                Category**
            
            **Number
                of securities to be issued upon exercise of outstanding options,
                warrants
                and rights**
            
            **Weighted-average
                exercise price of outstanding options, warrants and
                rights**
            
            **Number
                of securities remaining available for future issuance under equity
                compensation plans (excluding securities reflected in column
                (a))**Equity
                compensation plans approved by security holders(1)
            
            --
            
            $--
            
            1,486(1)Equity
                compensation plans not approved by security holders (2)(3)
            
            --
            
            --
            
            135,135(2)
              432,432(3)Total
            
            --
            
            $--
            
            569,053





(1)
      On
      April 23, 2003, a majority of the stockholders of the Company approved a
      performance equity plan for 10,000,000 shares of Common Stock ("2003 Performance
      Equity Plan"). The rights of the common stock were not changed. We intend to
      issue the shares of common stock from time to time as determined by the board
      of
      directors to directors, employees, consultants and others. The board of
      directors of the Company believes the 2003 Plan will provide flexibility in
      structuring compensation arrangements and provide an equity incentive for
      employees and others who are awarded shares under the 2003 Plan. The shares
      under an award may be issued at less than market price at the discretion of
      the
      board of directors. None of the awards as provided under the 2003 Plan are
      allocated to any particular person or class of persons among those eligible
      to
      receive awards. As of April 30, 2006 we have issued a total of 9,890,000 shares
      of common stock to various consultants under the Plan.




15





(2)
      On
      February 27, 2004, the board of directors of the Company (and approved by a
      majority of the Company’s stockholders in March 2004) approved a performance
      equity plan for 10,000,000 shares of common stock. The rights of the common
      stock were not changed. The purpose of the GL Energy and Exploration, Inc.
      2004
      Equity Performance Plan is to enable the Company to offer to its employees,
      officers, directors and consultants whose past, present and/or potential
      contributions to the Company and its Subsidiaries have been, or will be
      important to the success of the Company. The various types of long-term
      incentive awards that may be provided under the Plan will enable the Company
      to
      respond to changes in compensation practices, tax laws, accounting regulations
      and the size and diversity of its business. As of April 30, 2006, no shares
      have
      been issued under this plan.





On
      October 7, 2004, the board of directors of the Company approved the 2004 Stock
      Incentive Plan for 35,000,000 shares of Common Stock. The rights of the common
      stock were not changed. The purpose of the Plan is to encourage and enable
      officers, directors, and employees of GL Energy and Exploration, Inc. and its
      Subsidiaries and other persons to acquire a proprietary interest in the Company.
      It is anticipated that providing such persons with a direct stake in the
      Company's welfare will assure a closer identification of their interests with
      those of the Company and its shareholders, thereby stimulating their efforts
      on
      the Company's behalf and strengthening their desire to remain with the Company.
      As of April 30, 2006, we have issued a total of 4,500,000 shares of common
      stock
      to various consultants and employees.




**RECENT
      SALES OF UNREGISTERED SECURITIES**





On
      August
      6, 2006, we issued a 15% promissory note to a single investor. The
      issuance was exempt under Section 4(2) of the Securities Act of 1933, as
      amended.




On
      August
      4, 2006, American issued a 15% $750,000 promissory note to Generation
      Leasing Inc, an accredited investor. This promissory note consolidated
      certain other promissory notes previously issued by American. The note is
      guaranteed by the Company and David Michery, The issuance was exempt under
      Section 4(2) of the Securities Act of 1933, as amended.





On
      July
      10, 2006, we issued 500,000 shares of our common stock to a consultant as a
      compensatory stock grant. The issuance was exempt under Section 4(2) of the
      Securities Act of 1933, as amended.




On
      July
      12, 2006, the Company and American jointly issued a 10% $50,000 promissory
      note
      to a single accredited investor. The issuance was exempt under Section 4(2)
      of
      the Securities Act of 1933, as amended.




On
        June
        13, 2006, the Company issued 2,000,000 shares of its common stock to a
        consultant as a compensatory stock grant under a service agreement. The issuance
        was exempt under Section 4 (2) of the Securities Act of 1933, as amended.


Pursuant
      to the Exchange Agreement, in March 2006, the Company issued 22,500,000 shares
      of its common stock and 23,980 shares of its series A preferred stock to David
      Michery and Kent Puckett, the sole stockholders of American, in exchange for
      all
      of the American stock held by them. This issuance was exempt under Section
      4(2)
      of the Securities Act of 1933, as amended.





During
      the year ending December 31, 2004, the Company issued 2,900,000 shares of common
      stock for as compensatory stock grants. The Company’s board valued the common
      stock at $0.079 for a total value of $229,001. These issuances were exempt
      under
      Section 4(2) of the Securities Act of 1933, as amended.





On
      September 23, 2004, American issued 0% promissory notes to a single accredited
      investor in the amount of $175,000. These notes are, at the option of the
      holder, convertible into shares of our common stock at market value. The
      maturity date of the notes was March 23, 2005. Upon default, the notes bear
      interest at 10%. The notes are currently in default.





In
      August
      2004, American issued 3,746 shares of its common stock to David Michery and
      Kent
      Puckett as consideration for its purchase of all of the assets of Celestial
      Breakaway Records, a company owned solely by Messrs. Michery and Puckett.
      American’s board of directors valued these assets at $3,746,000. This issuance
      was exempt under Section 4(2) of the Securities Act of 1933, as
      amended.




16




In
      August
      2004, American issued 470 shares of our common stock to David Michery as
      consideration for its purchase of all of the assets of Out of Control Records,
      a
      company owned by Messrs. Michery and Puckett. American’s board of directors
      valued these assets at $470,000 This issuance was exempt under Section 4(2)
      of
      the Securities Act of 1933, as amended.





In
      August
      2004, American issued 76 shares of our common stock to Mr. Michery in exchange
      for certain furniture, fixtures and equipment contributed to us by Mr. Michery.
      This issuance was exempt under Section 4(2) of the Securities Act of 1933,
      as
      amended.





In
      August
      2004, American issued 2 shares of our common stock to Mr. Michery for a cash
      purchase price of $2,000. This issuance was exempt under Section 4(2) of the
      Securities Act of 1933, as amended.





From
      February through September 30, 2004, the Company issued 538,401 shares of common
      stock to 25 non-U.S. investors in a private placement for an aggregate purchase
      price of $110,428.. These issuances were exempt under Regulation S of the
      Securities Act of 1933, as amended. During the quarter ended June 30, 2004,
      the
      Company sold 538,401 shares from the trust for net proceeds of $110,428. The
      Company also issued a total of 1,370,000 shares of stock through December 31,
      2004 as compensatory stock grants to 2 consultants. The Company’s board valued
      the common stock at $.098 for a total value of $134,300. This issuance was
      exempt under Section 4(2) of the Securities Act of 1933, as
      amended.





During
      the year ending December 31, 2003, the Company issued 8,490,000 shares of common
      stock for services valued at $1,896,600 and issued 20,000,000 shares for an
      investment in a joint venture valued at $20,000. These issuances were exempt
      under Section 4(2) of the Securities Act of 1933, as amended.





In
      June
      2003, the Company issued 20,000,000 shares of common stock valued at $20,000
      to
      two directors for an investment in a mining claim in Chile. These shares were
      issued to two individuals, as follows: Donald Byers - 17,500,000 and Arthur
      Lang
      - 2,500,000. These issuances were exempt under Section 4(2) of the Securities
      Act of 1933, as amended.




**Item
      6. Management’s Discussion and Analysis or Plan of
      Operation**





The
      following discussion and analysis should be read in conjunction with our audited
      consolidated financial statements and related notes included in this report.
      This report contains “forward-looking statements” within the meaning of the
      Private Securities Litigation Reform Act of 1995. The statements contained
      in
      this report that are not historic in nature, particularly those that utilize
      terminology such as “may,” “will,” “should,” “expects,” “anticipates,”
“estimates,” “believes,” or “plans” or comparable terminology are
      forward-looking statements based on current expectations and
      assumptions.





Various
      risks and uncertainties could cause actual results to differ materially from
      those expressed in forward-looking statements. Factors that could cause actual
      results to differ from expectations include, but are not limited to, those
      set
      forth under the section “Risk Factors” set forth in this report.





The
      forward-looking events discussed in this annual report, the documents to which
      we refer you and other statements made from time to time by us or our
      representatives, may not occur, and actual events and results may differ
      materially and are subject to risks, uncertainties and assumptions about us.
      For
      these statements, we claim the protection of the “bespeaks caution” doctrine.
      All forward-looking statements in this document are based on information
      currently available to us as of the date of this report, and we assume no
      obligation to update any forward-looking statements. Forward-looking statements
      involve known and unknown risks, uncertainties and other factors that may cause
      the actual results to differ materially from any future results, performance
      or
      achievements expressed or implied by such forward-looking
      statements.





**General**





We
      produce, acquire, market and sell pre-recorded music through our wholly owned
      subsidiary, American. American was incorporated in the State of Texas in May
      2004. In July 2004, American acquired the assets of Celestial Breakaway Records’
and Out of Control Records’ music catalog, which consisted of rights to various
      master recordings previously released commercially. Pursuant to that
      acquisition, American procured the exclusive right to commercially market and
      sell those master recordings worldwide.




17




On
      March
      13, 2006, American, their shareholders and the Company entered into the Exchange
      Agreement pursuant to which the Company issued an aggregate of 22,500,000 shares
      of its common stock and 23,980 shares of its series A convertible preferred
      stock to the American stockholders in exchange of their transfer of American
      shares to the Company.





Our
      executive offices are located at 8721 Sunset Blvd., Penthouse 7, West Hollywood,
      California 90069. Our telephone number is (310) 659-8770.




**Significant
      Accounting Policies**





**Financial
      Statement Presentation**





The
      financial statements presented herein reflect the consolidated financial
      statements of the Company and American Southwest after giving effect to the
      reverse merger of the two companies on a historical basis.





**Music
      catalog**




Cost
      Basis




The
      cost
      basis in the music catalog is recorded at cost. Amortization will be computed
      using the straight-line method over periods ranging from 1 to 5 years.
      Amortization will be recorded once revenues commence.




**Risk
        of Obsolescence**
  A
            number
            of the Music Catalogues date from contracts entered into from 1997 -
            1998 that
            provide for a limited number of album or single release recordings and
            options
            for extension thereon. Accordingly, there is a risk that the Music Catalogues
            owned by the Company are subject to competition from later releases by
            the
            artists through other entities besides the Company, as well as the risk
            of the
            passage of time on the salability on the masters owned by the
            Company.


**Impairment
      of Long-Lived and Other Intangible Assets** ****





The
      Company reviews the carrying value of both its long-lived and other intangible
      assets annually, or whenever events or changes in circumstances indicate that
      the historical cost-carrying value of an asset may no longer be appropriate.
      The
      Company assesses recoverability of the carrying value of the asset by estimating
      the future net cash flows expected to result from the asset, including eventual
      disposition. If the future net cash flows are less than the carrying value
      of
      the asset, an impairment loss is recorded equal to the difference between the
      asset’s carrying value and fair value. At April 30, 2006 the Company’s
      evaluation determined that no provision for impairment of either its other
      intangible assets (its “Music Library”) or its fixed assets was required at that
      date.





**Consideration
      of Other Comprehensive Income Items**





SFAS
      130
      Reporting Comprehensive Income requires companies to present comprehensive
      income (consisting primarily of net income plus other direct equity changes
      and
      credits) and its components as part of the basic financial statements. The
      Company's financial statements do not contain any changes in equity that are
      required to be reported separately in comprehensive income.





**Recent
      Accounting Pronouncements** ****





In
      December 2004, the FASB issued SFAS No. 123(R), “Share-Based Payment,” which
      establishes standards for transactions in which an entity exchanges its equity
      instruments for goods or services. This standard requires a public entity to
      measure the cost of employee services received in exchange for an award of
      equity instruments based on the grant date fair value of the award. This
      eliminates the exception to account for such awards using the intrinsic method
      previously allowable under APB Opinion No. 25. SFAS No. 123 (R) became effective
      for the interim period beginning July 1, 2005. The Company does not anticipate
      that the adoption of SFAS No. 123(R) will have a significant impact on the
      Company’s overall results of operations or financial position.





In
      December 2004, the FASB issued SFAS No. 153, “Exchanges of Nonmonetary Assets,
      an amendment of APB Opinion No. 20, Accounting for Nonmonetary Transactions.”
The amendments made by SFAS No. 153 are based on the principle that exchanges
      of
      nonmonetary assets should be measured based on the fair value of the assets
      exchanged. Further, the amendments eliminate the narrow exception for
      nonmonetary exchanges of similar productive assets and replace it with a broader
      exception for exchanges of nonmonetary assets that do not have commercial
      substance. A nonmonetary exchange has commercial substance if the future cash
      flows of the entity are expected to change significantly as a result of the
      exchange. This statement shall be applied prospectively and is effective for
      nonmonetary asset exchanges occurring in fiscal periods beginning after June
      15,
      2005. Earlier application is permitted for nonmonetary asset exchanges occurring
      in fiscal periods beginning after the date of issuance. The Company does not
      anticipate that the adoption of SFAS No. 153 will have a significant impact
      on
      the Company’s overall results of operations or financial position.




18




In
      May
      2005, the FASB issued SFAS 154, “Accounting Changes and Error Corrections,” that
      applies to all voluntary changes in accounting principle. This Statement
      requires retrospective application to prior periods’ financial statements of
      changes in accounting principle, unless it is impracticable to determine either
      the period-specific effects or the cumulative effect of the change. When it
      is
      impracticable to determine the period-specific effects of an accounting change
      on one or more individual prior periods presented, this Statement requires
      that
      the new accounting principle be applied to the balances of assets and
      liabilities as of the beginning of the earliest period for which retrospective
      application is practicable and that a corresponding adjustment be made to the
      opening balance of retained earnings (or other appropriate components of equity
      or net assets in the statement of financial position) for that period rather
      than being reported in an income statement. When it is impracticable to
      determine the cumulative effect of applying a change in accounting principle
      to
      all prior periods, this Statement requires that the new accounting principle
      be
      applied as if it were adopted prospectively from the earliest date practicable.
      SFAS 154 will be effective for the Company for fiscal year ended December 31,
      2007. The Company does not anticipate that the adoption of SFAS No. 154 will
      have an impact on the Company’s overall results of operations or financial
      position.




**Plan
      of Operation**





We
      had no
      revenues for the year-ended April 30, 2006 or since its inception. We incurred
      $643,463 in operating expenses and $1,310,811 of other costs and expenses,
      which
      includes a $1,244,583 loss incurred on legal settlement on behalf of an entity
      formerly owned by David Michery for the year-ended April 30, 2006. We have
      also
      incurred $133,941 in legal and accounting fees. These fees were related to
      negotiating Recording Agreements, the Exchange Agreement, litigation and SEC
      compliance requirements. We paid our management $166,795.





We
      remain
      a development stage company. Since our inception, we have had minimum working
      capital to fund our operations. In order to pay the expenses of its operations,
      we have relied on third-party loans and loans from shareholders. As a result,
      we
      have incurred debt in the total amount of $937,580 to pay our expenses.
      Consequently, our balance sheet for the period of May 2004 (inception) through
      April 30, 2006, reflects a current asset value of $0 and a total asset value
      of
      $4,280,739 of which $0 is in the form of cash.





During
      the next twelve months of operations, we plan to carry out its plan of operation
      as described herein. Our management is currently seeking to execute several
      recording agreements with various production companies, labels and artists.
      There is no assurance as to when or whether we will locate suitable production
      companies, labels and artist or suitable master recordings. Also, there are
      not
      assurances that we will have sufficient capital to secure the rights under
      any
      Recording Agreement negotiated.





On
      January 25, 2006, we entered into an Exclusive Manufacturing and Distribution
      Agreement, Upstream Agreement and Exclusive Foreign License Agreement with
      Universal Records, a division of UMG Recordings, Inc.





Our
      management plans to select masters from its catalog for commercial release
      in
      2006, and seeking third-party licensing agreements to be included in the
      proposed compilation Albums derived from its catalog.





In
      the
      second calendar quarter of 2006, we plan to begin marketing the release of
      new
      Albums it intends to commercially release in the third and fourth calendar
      quarters of 2006. During the remainder of 2006 to mid-November 2006, we plan
      to
      release nine (9) separate Albums.





In
      the
      next 12 months, we plan to hire up 5 additional employees.





We
      have a
      working capital deficit and only a minimum amount of operating cash with which
      to fund our future operations. We must obtain adequate funding in order to
      fulfill our obligations under any recording agreement that we intend to execute,
      and adequate funding to market and advertise any of music products that we
      intend to release. If we do not receive adequate funding, its management must
      either discontinue or substantially scale back our planned
      operations.




19




We
      intend
      to seek either debt or equity capital or both. As of the date of this report,
      we
      do not have commitments for funding or any other agreements that will provide
      us
      with adequate working capital to conduct its full operating plan for the next
      twelve months. We cannot give any assurance that we will locate any funding
      or
      enter into any agreements that will provide the required operating capital
      to
      fund our planned business operations. In addition, we may consider receiving
      advances against future sales from Universal (as customary in the music
      industry) or to agree to sell rights to Master recordings, copyrights, or rights
      to any artist under a Recording Agreement or in our catalog. In addition, we
      may
      consider strategic alliances, mergers or acquisition as a means of pursuing
      our
      business plan or otherwise funding our business plan.





Our
      existing capital is currently not sufficient to enable us to meet our cash
      needs
      in conjunction with complying with our reporting obligations under Securities
      Exchange Act of 1934, as amended, for a period of twelve months following the
      date hereof.





Regardless
      of whether our cash assets are adequate to meet its operational needs, we will
      seek to compensate its management, consultants, employees and other service
      providers by issuing its shares of stock, or options to buy shares of its common
      stock in lieu of cash. For information as to our policy in regard to payment
      for
      services, see "Other Compensation Arrangements."





We
      anticipate obtaining funding from the sale of our common stock and from
      additional loans.




**Off-Balance
      Sheet Arrangements**





None.





20


**Item
      7. Financial Statements**




**** **Table
      of Contents**


Registered
                  Independent Independent Auditors’ Report
              F-1Consolidated
                  Balance Sheets
              F-2Consolidated
                  Statements of Operations
              F-3Consolidated
                  Statements of Stockholders’ Equity
              F-4Consolidated
                  Statements of Cash Flows
              F-5Notes
                  to Financial Statements
              F-7





21





**Registered
      Independent Auditors' Report**





To
      the
      Board of Directors and Stockholders


GL
      Energy
      and Exploration, Inc. (now known as American Southwest Music Distribution,
      Inc.)


Hollywood,
      California





We
      have
      audited the accompanying consolidated balance sheets of GL Energy and
      Exploration, Inc. (now known as American Southwest Music Distribution, Inc.),
      a
      development stage company, (hereon referred to as “the Company”) as of April 30,
      2006 and 2005, and the related consolidated statements of operations, cash
      flows, and changes in stockholders’ equity for the year ended April 30, 2006,
      and for the period from inception (July 1, 2004) to April 30, 2005. These
      consolidated financial statements are the responsibility of the Company's
      management. Our responsibility is to express an opinion on these consolidated
      financial statements based on our audit.





We
      conducted our audit in accordance with the standards of the Public Company
      Accounting Oversight Board (United States of America). Those standards require
      that we plan and perform the audit to obtain reasonable assurance about whether
      the consolidated financial statements are free of material misstatement. An
      audit includes examining, on a test basis, evidence supporting the amounts
      and
      disclosures in the consolidated financial statements. An audit also includes
      assessing the accounting principles used and significant estimates made by
      management, as well as evaluating the overall financial statement presentation.
      We believe that our audit provides a reasonable basis for our
      opinion.





In
      our
      opinion, the consolidated financial statements referred to above present fairly,
      in all material respects, the financial position of GL Energy and Exploration,
      Inc. (now known as American Southwest Music Distribution, Inc.) as of April
      30,
      2006 and 2005, and the results of its operations and its cash flows for the
      year
      ended April 30, 2006, and for the period from inception (July 1, 2004) to April
      30, 2005 in conformity with accounting principles generally accepted in the
      United States.





The
      accompanying consolidated financial statements have been prepared assuming
      that
      the Company will continue as a going concern. As discussed in Note 3 to the
      consolidated financial statements, the Company has suffered recurring losses
      from operations, and is dependent upon debt and equity financing to provide
      sufficient working capital to maintain continuity. These circumstances create
      substantial doubt about the Company’s ability to continue as a going concern.
      The consolidated financial statements do not include any adjustments that might
      result from the outcome of this uncertainty.








KBL,
      LLP


Certified
      Public Accountants


August
      24, 2006





F-1


**GL
                ENERGY AND EXPLORATION, INC.**
              **(NOW
                KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION,
                INC.)**
              **(
                A DEVELOPMENT STAGE COMPANY)**
              **CONSOLIDATED
                BALANCE SHEETS****April
                30,**
            
            **April
                30,****2006**
            
            **2005**ASSETSCurrent
                assets:Officer
                loan receivable
            
            $
            -
            
            $
            15,142Prepaid
                expenses
            
            
            
            
            
            10,746Total
                current assets
            
            
            -
            
            
            25,888Fixed
                assets:Furniture
                and fixtures
            
            
            42,488
            
            
            40,671Equipment
            
            
            40,501
            
            
            38,237Leasehold
                improvements
            
            
            7,000
            
            
            -89,989
            
            
            78,908Accumulated
                depreciation
            
            
            (28,620
            )
            
            (10,568
            )Total
                fixed assets
            
            
            61,369
            
            
            68,340Other
                assets:Music
                catalog, net of accumulated amortization of $0
            
            
            4,216,000
            
            
            4,216,000Security
                deposits
            
            
            3,370Deferred
                transaction costs
            
            
            -
            
            
            183,900Total
                other assets
            
            
            4,219,370
            
            
            4,399,900TOTAL
                ASSETS
            
            $
            4,280,739
            
            $
            4,494,128LIABILITIES
                AND STOCKHOLDERS' EQUITYCurrent
                liabilities:Accounts
                payable and accrued expenses payable
            
            $
            118,539
            
            $
            44,628Liability
                for legal settlement by Company on behalf of entity formerly owned
                by
                significant Company stockholder
            
            
            1,244,583
            
            
            -Notes
                and loans payable, stockholders and entities owned by them
            
            
            247,711
            
            
            49,009Notes
                and loans payable, others - unrelated third parties
            
            
            689,869
            
            
            223,000TOTAL
                LIABILITIES
            
            
            2,300,702
            
            
            316,637Stockholders'
                equity:Preferred
                  stock - $0.001 par value; 5,000,000 shares authorized, 23,980 issued
                  and
                  outstanding in 2006; $0 par value; 1,000 shares authorized, 0 shares
                  issued and outstanding in 2005
            
            
            24
            
            
            -Common
                  stock - $0.001 par value; 100,000,000 shares authorized, 59,977,042
                  issued
                  and outstanding in 2006; $.001 par value; 9,000 shares authorized,
                  4,294
                  shares issued and outstanding in 2005
            
            
            59,977
            
            
            4Additional
                paid-in capital
            
            
            5,385,777
            
            
            4,294,733Deficit
                accumulated during the development stage
            
            
            (3,465,741
            )
            
            (117,246
            )Total
                stockholders' equity
            
            
            1,980,037
            
            
            4,177,491TOTAL
                LIABILITIES AND STOCKHOLDERS' EQUITY
            
            $
            4,280,739
            
            $
            4,494,128*See
                registered independent auditors' report*





F-2





**GL
                ENERGY AND EXPLORATION, INC.**
              **(NOW
                KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION,
                INC.)**
              **(
                A DEVELOPMENT STAGE COMPANY)**
              **CONSOLIDATED
                STATEMENTS OF OPERATIONS****Inception
                (July 1, 2004)**
            
            **Inception****Year
                ended**
            
            **through**
            
            **through****April
                30,**
            
            **April
                30,**
            
            **April
                30,****2006**
            
            **2005**
            
            **2006**EXPENSESRelated
                party consulting fees and services
            
            $
            348,975
            
            $
            -
            
            $
            348,975General
                and administrative
            
            
            258,520
            
            
            94,289
            
            
            352,809Depreciation
                and amortization
            
            
            35,968
            
            
            10,568
            
            
            46,536Total
                expenses
            
            
            643,463
            
            
            104,857
            
            
            748,320Loss
                from operations
            
            
            (643,463
            )
            
            (104,857
            )
            
            (748,320
            )Other
                costs and expensesLoss
                  incurred on legal settlement by Company on behalf of entity formerly
owned
                  by significant Company stockholder
            
            
            (1,244,583
            )
            
            -
            
            
            (1,244,583
            )Interest
                expense
            
            
            (66,228
            )
            
            (12,389
            )
            
            (78,617
            )Total
                other costs and expenses
            
            
            (1,310,811
            )
            
            (12,389
            )
            
            (1,323,200
            )NET
                LOSS
            
            $
            (1,954,274
            )
            $
            (117,246
            )
            $
            (2,071,520
            )Net
                loss per share - basic and diluted
            
            $
            (0.25
            )
            $
            (34.15
            )
            $
            (0.48
            )Weighted
                average shares outstanding:Basic
                and diluted
            
            
            7,891,121
            
            
            3,433
            
            
            4,306,887*See
                registered independent auditors' report*





F-3





**GL
                ENERGY AND EXPLORATION, INC.**
              **(NOW
                KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION,
                INC.)**
              **(
                A DEVELOPMENT STAGE COMPANY)**
              **CONSOLIDATED
                STATEMENTS OF STOCKHOLDERS' EQUITY**
              **Period
                from July 1, 2004 (Inception) through April 30,
                2006****Deficit****Accumulated****Additional**
            
            **During
                the****Preferred
                Stock**
            
            **Common
                Stock**
            
            **Paid
                in**
            
            **Development****Shares**
            
            **Amount**
            
            **Shares**
            
            **Amount**
            
            **Capital**
            
            **Stage**
            
            **Total**Issuance
                    of common stock to Company's founders
                    in exchange for music catalog, furniture and fixtures, and equipment
            
            
            -
            
            $
            -
            
            
            4,292
            
            $
            4
            
            $
            4,292,733
            
            $
            -
            
            $
            4,292,737Capital
                contribution
            
            
            
            
            
            
            
            
            2
            
            
            
            
            
            2,000
            
            
            
            
            
            2,000Net
                  loss for period from inception (July
                  1, 2004) to April 30, 2005
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (117,246
            )
            
            (117,246
            )Balance,
                April 30, 2005
            
            
            -
            
            
            -
            
            
            4,294
            
            
            4
            
            
            4,294,733
            
            
            (117,246
            )
            
            4,177,491Recapitalization
                    of common and preferred shares
                    of GL Energy and Exploration, Inc. as acquiree in merger with
                    Company
                    as
                    acquirer
            
            
            23,980
            
            
            24
            
            
            59,972,748
            
            
            59,973
            
            
            1,091,044
            
            
            (1,394,401
            )
            
            (243,360
            )Net
                loss
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (1,954,094
            )
            
            (1,954,094
            )Balance,
                April 30, 2006
            
            
            23,980
            
            $
            24
            
            
            59,977,042
            
            $
            59,977
            
            $
            5,385,777
            
            $
            (3,465,741
            )
            $
            1,980,037*See
                registered independent auditors' report.*




F-4





**GL
                ENERGY AND EXPLORATION, INC.**
              **(NOW
                KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION,
                INC.)**
              **(
                A DEVELOPMENT STAGE COMPANY)**
              **CONSOLIDATED
                STATEMENTS OF CASH FLOWS****Inception****Year
                ended**
            
            **Year
                ended**
            
            **through****April
                30,**
            
            **April
                30,**
            
            **April
                30,****2006**
            
            **2005**
            
            **2006**CASH
                FLOWS FROM OPERATING ACTIVITIES:Net
                loss
            
            $
            (1,954,094
            )
            $
            (117,246
            )
            $
            (2,071,340
            )Adjustments
                to reconcile net deficit to cash used
                in operating activities:Depreciation
                and amortization
            
            
            35,968
            
            
            10,568
            
            
            46,536Loss
                  incurred on legal settlement by Company on behalf of entity formerly
                  owned by significant Company stockholder
            
            
            1,244,583
            
            
            -
            
            
            1,244,583Net
                changes in:Decrease
                (increase) in prepaid expenses
            
            
            10,746
            
            
            (10,746
            )
            
            -Increase
                in security deposits
            
            
            (3,370
            )
            
            -
            
            
            (3,370
            )Increase
                in accounts and accrued expenses payable
            
            
            48,393
            
            
            44,628
            
            
            93,021NET
                CASH USED IN OPERATING ACTIVITIES
            
            
            (617,774
            )
            
            (72,796
            )
            
            (690,570
            )CASH
                FLOWS FROM INVESTING ACTIVITIES:Decrease
                (increase) in officer loan receivable
            
            
            15,142
            
            
            (15,142
            )Acquisition
                of furniture and equipment
            
            
            (11,081
            )
            
            (2,171
            )
            
            (13,252
            )NET
                  CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
            
            
            4,061
            
            
            (17,313
            )
            
            (13,252
            )CASH
                FLOWS FROM FINANCING ACTIVITIES:Decrease
                (increase) in deferred transaction costs
            
            
            183,900
            
            
            (183,900
            )
            
            -Notes
                  and loans payable, stockholders and entities owned
                  by them
            
            
            24,813
            
            
            49,009
            
            
            73,822Notes
                and loans payable, others - unrelated third parties
            
            
            405,000
            
            
            223,000
            
            
            628,000Common
                shares issued for cash
            
            
            -
            
            
            2,000
            
            
            2,000NET
                CASH PROVIDED BY FINANCING ACTIVITIES
            
            
            613,713
            
            
            90,109
            
            
            703,822NET
                CHANGE IN CASH AND CASH EQUIVALENTS
            
            
            -
            
            
            -
            
            
            -CASH
                AND CASH EQUIVALENTS AT
                BEGINNING OF PERIOD
            
            
            -
            
            
            -
            
            
            -CASH
                AND CASH EQUIVALENTS AT
                END OF PERIOD
            
            $
            -
            
            $
            -
            
            $
            -Supplementary
                disclosures of cash flow informationCash
                paid during the year for:Income
                taxes
            
            $
            -
            
            $
            -
            
            $
            -Interest
                expense
            
            
            -
            
            
            -
            
            
            -Non-cash
                operating, investing and financing activities:Net
                assets (liabilities) acquired by Company as part ofMergerAssets
                acquired:Accounts
                receivable
            
            
            -
            
            
            -
            
            
            -Total
                assets acquired
            
            
            0
            
            
            -
            
            
            0




F-5




Liabilities
                acquired:Accounts
                and accrued expenses payable
            
            
            3,306
            
            
            -
            
            
            3,306Loans
                payable, shareholders
            
            
            240,053
            
            
            -
            
            
            150,753Total
                liabilities acquired
            
            
            243,359
            
            
            -
            
            
            154,059Net
                liabilities assumed
            
            
            (243,359
            )
            
            -
            
            
            (154,059
            )Change
                in Company's stockholders' equityPreferred
                stock issued at par value
            
            
            24
            
            
            -
            
            
            24Common
                stock issued at par value
            
            
            59,973
            
            
            -
            
            
            59,973Increase
                  in additional paid-in capital resulting from difference in
                  value of shares exchanged between GL Energy andAmerican
                  Southwest Music Distribution, Inc.
            
            
            1,091,044
            
            
            -
            
            
            1,091,044Increase
                  in accumulated deficit resulting from difference in
                  value of shares exchanged between GL Energy and American
                  Southwest Music Distribution, Inc.
            
            
            (1,394,400
            )
            
            -
            
            
            (1,394,400
            )(243,359
            )
            
            -
            
            
            (243,359
            )Common
                shares issued for music catalog
            
            
            -
            
            
            4,216,000
            
            
            4,216,000Common
                shares issued for furniture, fixtures, and equipment
            
            
            -
            
            
            76,737
            
            
            76,737*See
                registered independent auditors' report*





F-6


**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED** **** **FINANCIAL
      STATEMENTS**





**NOTE
      1 - NATURE OF BUSINESS / ORGANIZATION** ****




**Nature
      of Business**





GL
      Energy
      and Exploration, Inc. (herein referred to as “GL Energy” and the “Company”) was
      a development stage company with no business operations through March 2006.
      GL
      Energy was incorporated in Delaware on October 7, 1998 under the name LRS Group
      Incorporated. On October 15, 1998, the name was changed to LRS Capital, Inc.
      On
      October 10, 2001, the company changed its name to GL Energy and Exploration,
      Inc. GL Energy was traded on the OTC Bulletin board under the symbol “GEEX.OB.”





**Merger
      with American Southwest Music Distribution, Inc.**





American
      Southwest Music Distribution, Inc. (“American Southwest”) was incorporated in
      the State of Texas in May of 2004. American Southwest remained inactive until
      it
      commenced development stage activity in July of 2004.





American
      Southwest was created to generate revenue through music licensing, recording,
      and distribution. American Southwest acquired the rights to several music master
      catalogs for the purpose of generating revenues from the sale of records derived
      from these catalogs. The expansion and exploitation of its music catalog is
      an
      integral part of American Southwest’s business and growth strategy. American
      Southwest owns a music catalog with 25 album masters, and intends to add to
      the
      music catalog through strategic and complementary acquisitions, licensing
      agreements, and by executing recording agreements with artists, production
      companies, and other record labels with new recordings.





On
      March
      13, 2006, American Southwest and GL Energy entered into a Securities Purchase
      Agreement and Plan of Reorganization. As part of the agreement GL Energy issued
      22,500,000 shares of their $.001 par value common stock and 23,980 shares of
      their $.001 par value Series A convertible preferred stock to David Michery
      and
      Kent Puckett, the sole shareholders of American Southwest, in exchange for
      all
      of the issued and outstanding $.001 par value common shares of American
      Southwest, totaling 4,294 shares.





Since
      GL
      Energy had no assets of substance prior to the transaction, for accounting
      purposes the acquisition has been treated as a merger of both companies and
      recapitalization of the shares of American Southwest, with GL Energy as the
      acquirer and American Southwest as the surviving entity (reverse acquisition).
      The accounting rules for reverse acquisitions require that, beginning with
      the
      date of the acquisition (March 13, 2006), the balance sheet include the assets
      and liabilities of American Southwest and the equity accounts be recapitalized
      to reflect the net equity of American Southwest. Accordingly, the historical
      operating results are now the operating results of American Southwest. The
      historical development stage entity financial statements prior to March 13,
      2006
      are those of American Southwest.




On
      August
      18, 2006 the State of Delaware approved the Company changing its name from
“GL
      Energy and Exploration, Inc.” to “American Southwest Music Distribution,
      Inc.” **** Effective
      August 24, 2006 the Company is now traded
      on
      the OTC Bulletin board under the symbol “ASWD.OB.”




*See
      registered independent auditors’ report.*




F-7




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED** **** **FINANCIAL
      STATEMENTS**





**NOTE
      2 - SUMMARY OF ACCOUNTING POLICIES**





**Financial
      Statement Presentation**





The
      financial statements presented herein reflect the consolidated financial
      statements of GL Energy and American Southwest after giving effect to the
      reverse merger of the two companies on a historical basis.





**Reclassifications**





Certain
      prior year amounts have been reclassified to conform to the current year
      presentation.





**Use
      of Estimates** ****





In
      preparing financial statements, management makes estimates and assumptions
      that
      affect the reported amounts of assets and liabilities in the balance sheet
      and
      revenue and expenses in the statement of expenses. Actual results could differ
      from those estimates.





**Principles
      of Consolidation**




The
        consolidated financial statements include the accounts of the merged entities.
        All significant intercompany transactions and balances have been eliminated
        in
        consolidation.


**Cash
      and Cash Equivalents** ****





For
      purposes of the statement of cash flows, the Company considers all highly liquid
      investments purchased with an original maturity of three months or less to
      be
      cash equivalents.





**Revenue
      Recognition** ****





The
      Company recognizes revenue when persuasive evidence of an arrangement
      exists, services
      have been rendered, the sales price is fixed or determinable, and collectability
      is reasonably assured.





**Music
      Catalog**




Cost
      Basis





The
      cost
      basis in the music catalog is recorded at cost. Amortization will be computed
      using the straight-line method over periods ranging from 1 to 5 years.
      Amortization will be recorded once revenues commence.





**Risk
      of Obsolescence**




A
          number
          of the Music Catalogues date from contracts entered into from 1997 - 1998
          that
          provide for a limited number of album or single release recordings and
          options
          for extension thereon. Accordingly, there is a risk that the Music Catalogues
          owned by the Company are subject to competition from later releases by
          the
          artists through other entities besides the Company, as well as the risk
          of the
          passage of time on the salability on the masters owned by the
          Company.


**Fixed
      assets**





Fixed
      assets are stated at cost. Depreciation is computed using the straight-line
      method over the following estimated useful lives:




*Estimated**Description*
              *useful
                  life*Furniture
                  and fixtures
              5
                  yearsEquipment
              5
                  yearsLeasehold
                  improvements
              2
                  years




*See
      registered independent auditors’ report.*




F-8




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**CONSOLIDATED
      NOTES TO FINANCIAL STATEMENTS**





**NOTE
      2 - SUMMARY OF ACCOUNTING POLICIES (CONTINUED)**





**Impairment
      of Long-Lived and Other Intangible Assets** ****





The
      Company reviews the carrying value of both its long-lived and other intangible
      assets annually, or whenever events or changes in circumstances indicate that
      the historical cost-carrying value of an asset may no longer be appropriate.
      The
      Company assesses recoverability of the carrying value of the asset by estimating
      the future net cash flows expected to result from the asset, including eventual
      disposition. If the future net cash flows are less than the carrying value
      of
      the asset, an impairment loss is recorded equal to the difference between the
      asset’s carrying value and fair value. At April 30, 2006 the Company’s
      evaluation determined that no provision for impairment of either its other
      intangible assets (its “Music Library”) or its fixed assets was required at that
      date.





**Income
      Taxes** ****





The
      Company recognizes deferred tax assets and liabilities based on differences
      between the financial reporting and tax bases of assets and liabilities using
      the enacted tax rates and laws that are expected to be in effect when the
      differences are expected to be recovered. The Company provides a valuation
      allowance for deferred tax assets for which it does not consider realization
      of
      such assets to be more likely than not.





**Basic
      and Diluted Loss per Share** ****





The
      Company complies with the requirements of the Financial Accounting Standards
      Board issued Statement of Financial Accounting Standards No. 128, “Earning per
      Share” (“SFAS No. 128”). SFAS No. 128 specifies the compilation, presentation
      and disclosure requirements for earnings per share for entities with publicly
      held common stock or potentially common stock. Net loss per common share, basic
      and diluted, is determined by dividing the net loss by the weighted average
      number of common shares outstanding.





Net
      loss
      per common share-diluted does not include potential convertible preferred shares
      (See Note 1).





**Consideration
      of Other Comprehensive Income Items**





SFAS
      130
      Reporting Comprehensive Income requires companies to present comprehensive
      income (consisting primarily of net income plus other direct equity changes
      and
      credits) and its components as part of the basic financial statements. The
      Company's financial statements do not contain any changes in equity that are
      required to be reported separately in comprehensive income.





**Recent
      Accounting Pronouncements** ****





In
      December 2004, the FASB issued SFAS No. 123(R), “Share-Based Payment,” which
      establishes standards for transactions in which an entity exchanges its equity
      instruments for goods or services. This standard requires a public entity to
      measure the cost of employee services received in exchange for an award of
      equity instruments based on the grant date fair value of the award. This
      eliminates the exception to account for such awards using the intrinsic method
      previously allowable under APB Opinion No. 25. SFAS No. 123 (R) became effective
      for the interim period beginning July 1, 2005. The Company does not anticipate
      that the adoption of SFAS No. 123(R) will have a significant impact on the
      Company’s overall results of operations or financial position.




*See
      registered independent auditors’ report.*




F-9




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





**NOTE
      2 - SUMMARY OF ACCOUNTING POLICIES (CONTINUED)**





**Recent
      Accounting Pronouncements (continued** **)**





In
      December 2004, the FASB issued SFAS No. 153, “Exchanges of Non-monetary Assets,
      an amendment of APB Opinion No. 20, Accounting for Non-monetary Transactions.”
The amendments made by SFAS No. 153 are based on the principle that exchanges
      of
      non-monetary assets should be measured based on the fair value of the assets
      exchanged. Further, the amendments eliminate the narrow exception for
      non-monetary exchanges of similar productive assets and replace it with a
      broader exception for exchanges of non-monetary assets that do not have
      commercial substance. A non-monetary exchange has commercial substance
      if the future cash flows of the entity are expected to change significantly
      as a
      result of the exchange. This statement shall be applied prospectively and is
      effective for non-monetary asset exchanges occurring
      in fiscal periods beginning after June 15, 2005. Earlier application is
      permitted for non-monetary asset exchanges occurring in fiscal periods beginning
      after the date of issuance. The Company does not anticipate that the adoption
      of
      SFAS No. 153 will have a significant impact on the Company’s overall results of
      operations or financial position.





In
      May
      2005, the FASB issued SFAS 154, “Accounting Changes and Error Corrections,” that
      applies to all voluntary changes in accounting principle. This Statement
      requires retrospective application to prior periods’ financial statements of
      changes in accounting principle, unless it is impracticable to determine either
      the period-specific effects or the cumulative effect of the change. When it
      is
      impracticable to determine the period-specific effects of an accounting change
      on one or more individual prior periods presented, this Statement requires
      that
      the new accounting principle be applied to the balances of assets and
      liabilities as of the beginning of the earliest period for which retrospective
      application is practicable and that a corresponding adjustment be made to the
      opening balance of retained earnings (or other appropriate components of equity
      or net assets in the statement of financial position) for that period rather
      than being reported in an income statement. When it is impracticable to
      determine the cumulative effect of applying a change in accounting principle
      to
      all prior periods, this Statement requires that the new accounting principle
      be
      applied as if it were adopted prospectively from the earliest date practicable.
      SFAS 154 will be effective for the Company for fiscal year ended December 31,
      2007. The Company does not anticipate that the adoption of SFAS No. 154 will
      have an impact on the Company’s overall results of operations or financial
      position.





**NOTE
      3 - GOING CONCERN**





As
      shown
      in the accompanying consolidated financial statements, the Company incurred
      recurring net losses totaling $2,071,520 as a development stage entity for
      the
      period from inception (July 1, 2004) through April 30, 2006. The Company has
      an
      accumulated deficit of $3,465,741 and a deficiency in working capital of
      $2,300,702 as of April 30, 2006. These conditions raise substantial doubt as
      to
      the Company’s ability to continue as a going concern. Management is trying to
      raise additional capital through sales of stock or loan financing arrangements.
      The financial statements do not include any adjustments that might be necessary
      if the Company is unable to continue as a going concern.




*See
      registered independent auditors’ report.*




F-10




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





**NOTE
      4 - INCOME TAXES**





The
      Company incurred no federal income tax expense for the years ended April 30,
      2006 and 2005. The Company has net operating loss carryforwards available of
      approximately $2,071,000 to offset future net income. Due to uncertainty
      surrounding the realization of the favorable tax attributes in future tax
      returns, the Company has placed a full valuation allowance against its net
      deferred tax asset. At such time as it is determined that it is more likely
      than
      not that the deferred tax asset is realizable, the valuation allowance will
      be
      reduced. Furthermore, the net operating loss carry forward may be subject to
      further limitation pursuant to Section 382 of the Internal Revenue Code.





The
      cumulative net operating loss carryforward will expire in accordance with the
      following schedule:


April
                  30, 2025
              
              $
              117,2462026
              
              
              1,954,274$
              2,071,520Deferred
                  income taxes consist of the following:Deferred
                  tax assets
              
              $
              704,256Less:
                  valuation allowance
              
              
              704,256$
              --





*See
      registered independent auditors’ report.*




F-11




**GL
      ENERGY AND EXPLORA TION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





**NOTE
      5 - NOTES AND LOANS PAYABLE**





Details
      regarding notes and loans payable follow below:


Donald
                  Byers, formerPresident
                  and Chairman of the Board of pre-merger GL Energy and
                  Exploration, Inc. and a holder of approximately 16,190,000 of the
                  post-merger entity’s
                  $.001 par value common shares:Unsecured
                  $49,009 note dated April 25, 2005 held by Byers and Associates,
                  an entity
                  owned
                  by Donald Byers. The note was due and payable on February 28, 2006.
The
                  note accrued interest at a rate of 10% per annum, in the event
                  of default,
                  on the entire
                  unpaid principal balance. The note included an amount equal to
                  $10,916,
                  which represents
                  prior interest expense incurred added to the note balance. The
                  principal
                  balance
                  plus accrued interest that was due on February 28, 2006 had not
                  been paid
                  and the
                  note was in default. It continues to accrue interest and the holder
                  has
                  indicated the intention
                  not to demand payment of the amount due for a period of at least
                  one year
                  from the
                  April 30, 2006 balance sheet date.
              
              $
              49,009Unsecured
                  $16,592 note dated May 26, 2005 held by Byers and Associates, an
                  entity
                  owned
                  by Donald Byers. The note was due and payable on February 28, 2006.
                  The
                  note accrued
                  interest at a rate of 10% per annum. The principal balance plus
                  accrued
                  interest that
                  was due on February 28, 2006 had not been paid and the note was
                  in
                  default. It continues
                  to accrue interest and the holder has indicated the intention not
                  to
                  demand payment
                  of the amount due for a period of at least one year from the April
                  30,
                  2006 balance
                  sheet date.
              
              
              16,592Unsecured
                  $101,180 loans payable to Don Byers. The loans are due on demand
                  and accrue
                  interest at 10% per annum. They continues to accrue interest and
                  the
                  holder has indicated
                  the intention not to demand payment of the amount due for a period
                  of at
                  least one
                  year from the April 30, 2006 balance sheet date.
              
              
              101,180Unsecured
                  $24,409 loan payable to Wellstar International, an entity owned
                  by Don
                  Byers.
                  The loan is due on demand and accrues interest at 10% per annum.
                  It continues
                  to accrue interest and the holder has indicated the intention not
                  to
                  demand payment
                  of the amount due for a period of at least one year from the April
                  30,
                  2006 balance
                  sheet date.
              
              
              24,409Unsecured
                  $10,800 loan payable to Northern Business, entity owned by Don
                  Byers.
                  The
                  loan is due on demand and accrues interest at 10% per annum. It
                  continues
                  to accrue
                  interest and the holder has indicated the intention not to demand
                  payment
                  of the amount
                  due for a period of at least one year from the April 30, 2006 balance
                  sheet date.
              
              
              10,800201,990




*See
      registered independent auditors’ report.*




F-12




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED** **** **FINANCIAL
      STATEMENTS**





**NOTE
      5 - NOTES AND LOANS PAYABLE (CONTINUED)**





**Other
                  Stockholders**Unsecured
                  $37,500 loan payable to Chris Lotito, a minority shareholder. The
                  loan is
                  due on demand and accrue interest at 10% per annum. It continues
                  to accrue
                  interest and the holder has indicated the intention not to demand
                  payment
                  of the amount due for a period of at least one year from the April
                  30,
                  2006 balance sheet date.
              
              $
              37,500Unsecured
                  $8,221 loan payable to David Michery, the Company’s Chief Executive
                  Officer. The loan is non-interest bearing and due on demand. It
                  continues
                  to accrue interest and the holder has indicated the intention not
                  to
                  demand payment of the amount due for a period of at least one year
                  from
                  the April 30, 2006 balance sheet date.
              
              
              8,221Notes
                  and loans payable, stockholders and the entities owned by
                  them
              
              
              247,711**Other
                  unrelated third parties**$150,000
                  unrelated third party note dated March 30, 2006 held by Generation
                  Leasing, LLC, net of unamortized deferred loan origination fees
                  of
                  $13,333. The note was due and payable on December 30, 2006. The
                  note
                  called for a monthly payment of $1,875, which represented interest
                  only
                  calculated on an annual interest rate of 15%. All assets of the
                  Company,
                  including intangibles, patents, and purchase contracts, were to
                  be
                  security for repayment.
              
              
              136,667$150,000
                  unrelated third party note dated November 30, 2005 held by Generation
                  Leasing,LLC, net of unamortized deferred loan origination fees
                  of $8,750.
                  The note was due and payable on November 30, 2006. The note called
                  for a
                  monthly payment of $1,875, which represented interest only calculated
                  on
                  an annual interest rate of 15%. All assets of the Company, including
                  intangibles, patents, and purchase contracts, were to be security
                  for
                  repayment.
              
              
              141,250$150,000
                  unrelated third party note dated August 26, 2005 held by Generation
                  Leasing,LLC, net of unamortized deferred loan origination fees
                  of $5,000.
                  The note was due and payable on August 31, 2006. The note called
                  for a
                  monthly payment of $1,875, which represented interest only calculated
                  on
                  an annual interest rate of 15%. All assets of the Company, including
                  intangibles, patents, and purchase contracts, were to be security
                  for
                  repayment.
              
              
              145,000$150,000
                  unrelated third party note dated September 23, 2004 held by Pegasus
                  Capital, Inc.The note accrued interest at a rate of 6.5% per annum.
                  The
                  entire outstanding unpaid principal balance plus accrued interest
                  was due
                  and payable on November 21, 2004 in either cash or common stock
                  of the
                  Company equal to the fair market value of the unpaid obligation.
                  In the
                  event of default, the entire unpaid principal balance and all accrued
                  interest was to become immediately due and payable, while interest
                  was to
                  accrue at a rate of 10% starting from the date of the note. The
                  principal
                  balance plus accrued interest that was due on November 21, 2004
                  was not
                  paid and the note was in default. It continues to accrue interest
                  and the
                  holder has indicated the intention not to demand payment of the
                  amount due
                  for a period of at least one year from the April 30, 2006 balance
                  sheet
                  date.
              
              
              150,000


*See
      registered independent auditors’ report.*




F-13




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





**NOTE
      5 - NOTES AND LOANS PAYABLE (CONTINUED)**


**Other
                  unrelated third parties (continued)**$38,000
                  unrelated third party note dated April 25, 2005 held by Pegasus
                  Capital,
                  Inc. The note was due and payable on March 1, 2006, and under the
                  note
                  provision did not accrue interest. In the event of default, interest
                  was
                  to accrue at a rate 10% per annum. The entire outstanding unpaid
                  principal
                  balance plus accrued interest was due and payable in either cash
                  or common
                  stock of the Company equal to the fair market value of the unpaid
                  obligation. The principal balance plus accrued interest that was
                  due on
                  March 1, 2006 had not been paid and the note was in default. It
                  continues
                  to accrue interest and the holder has indicated the intention not
                  to
                  demand payment of the amount due for a period of at least one year
                  from
                  the April 30, 2006 balance sheet date.
              
              $
              38,000$25,000
                  unrelated third party note dated September 23, 2004 held by Pegasus
                  Capital, Inc.The note accrues interest at a rate of 6.5% per annum.
                  The
                  entire outstanding unpaid principal balance plus accrued interest
                  was due
                  and payable on November 21, 2004 in either cash or common stock
                  of the
                  Company equal to the fair market value of the unpaid obligation.
                  In the
                  event of default, the entire unpaid principal balance and all accrued
                  interest was to become immediately due and payable, while interest
                  was to
                  accrue at a rate of 10% starting from the date of the note. The
                  principal
                  balance plus accrued interest that was due on November 21, 2004
                  had not
                  been paid and the note was in default. It continues to accrue interest
                  and
                  the holder has indicated the intention not to demand payment of
                  the amount
                  due for a period of at least one year from the April 30, 2006 balance
                  sheet date.
              
              
              25,000$10,000
                  unrelated third party note dated August 31, 2004 held by Pegasus
                  Capital,
                  Inc.The note accrued interest at a rate of 6.5% per annum. The
                  entire
                  outstanding unpaid principal balance plus accrued interest was
                  due and
                  payable on August 31, 2005. There was to be no pre-payment of any
                  kind
                  without the written consent of both parties. In the event of default
                  the
                  entire unpaid principal balance and all accrued interest was to
                  become
                  immediately due and payable, while interest was to accrue at a
                  rate of 25%
                  starting from the date of the note. The principal balance plus
                  accrued
                  interest that was due on August 31, 2005 had not been paid and
                  the note
                  was in default. It continues to accrue interest and the holder
                  has
                  indicated the intention not to demand payment of the amount due
                  for a
                  period of at least one year from the April 30, 2006 balance sheet
                  date.
              
              
              10,000Unsecured
                  $43,952 loan payable to Three Sisters Investment Corp. The loan
                  is due on
                  demand and accrues interest at 10% per annum. It continues to accrue
                  interest and the holder has indicated the intention not to demand
                  payment
                  of the amount due for a period of at least one year from the April
                  30,
                  2006 balance sheet date.
              
              
              43,952Notes
                  and loans payable, others - unrelated third parties
              
              
              689,869$
              937,580


Accounts
      payable and accrued expenses payable at April 30, 2006 includes $9,390 of
      accrued interest payable to Company stockholders and entities owned by them.
      Prepaid expenses at April 30, 2005 include $10,746 of prepaid interest paid
      by
      the Company in advance to a Company stockholder, Donald Byers. Accounts payable
      and accrued expenses payable at April 30, 2006 and 2005, includes $51,212 and
      $12,219 of accrued interest payable to unrelated parties, respectively.





*See
      registered independent auditors’ report.*




F-14




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





**NOTE
      5 - NOTES AND LOANS PAYABLE (CONTINUED)**





Interest
      expense incurred by the Company to Company stockholders and entities owned
      by
      them was $14,920 and $170 for years ended April 30, 2006 and 2005, respectively,
      and $15,090 for the period from inception of the development stage (July 1,
      2004) to April 30, 2006. Interest expense incurred by the Company to unrelated
      third parties was $51,308 and $12,219 for year ended April 30, 2006 and for
      the
      period from inception (July 1, 2004) through April 30, 2005, respectively,
      and
      $63,527 for the period from inception of the development stage (July 1, 2004)
      to
      April 30, 2006.





See
      Note
      11 concerning additional borrowing and promissory notes made subsequent to
      the
      balance sheet date.





**NOTE
      6 - OPERATING FACILITIES**





The
      Company maintained offices in Santa Fe Springs, California under a sublease
      agreement dated August 1, 2004, whereby it was required to make monthly payments
      of $3,900 to a third party landlord under a lease which was to expire in August
      31, 2006, on behalf of American Music Corporation, Inc. (“AMC”), an entity
      formerly owned by David Michery. The landlord agreed to terminate the lease
      in
      April 2005 and the lease was settled by the Company for a final payment of
      $12,592, which amount was charged to rent expense by the Company.





The
      Company entered into a new lease for office space located in West Hollywood,
      California, which commenced November 2005 and will expire on October 31, 2007.
      The lease agreement requires monthly payments of $1,685. Future minimum lease
      payments are as follows:




April
                  30, 2007
              
              $
              20,2202008
              
              
              10,110


Rent
      expense incurred by the Company was $10,106 and $30,352 for year ended April
      30,
      2006 and for the period from inception (July 1, 2004) through April 30, 2005,
      respectively, and $40,458 for the period from inception of the development
      stage
      (July 1, 2004) to April 30, 2006.




**NOTE
      7 - RELATED PARTY TRANSACTIONS**





**(A)**
            **CONTRIBUTED
                INTANGIBLE ASSETS AND EQUITY CAPITALIZATION OF AMERICAN SOUTHWEST
                PRIOR TO
                THE MARCH 13, 2006 MERGER
                TRANSACTION**





During
      2004, American Southwest issued 470 shares and 3,746 shares of its $.001 par
      value common stock to Out of Control Records, Inc. and Celestial Breakaway
      Records (“Celestial”) in exchange for Music Catalogs valued at the actual cost
      paid by those entities to obtain the underlying contracts and “Masters” in the
      Catalogs of $470,000 and $3,746,000, respectively. Out of Control Records,
      Inc.
      and Celestial are owned and controlled by David Michery. In addition, the
      American Southwest issued 76 shares of its $.001 par value common stock to
      David
      Michery in exchange for furniture and fixtures, and equipment valued at $76,737.
      David Michery also paid $2,000 for 2 shares of $.001 par value common stock.





A
      settlement by the Company with Vestcom, Ltd involving assets transferred to
      Celestial that included the Music Catalogues received by the Company in exchange
      for its shares in the preceding paragraph is described in detail in (B) below.




*See
      registered independent auditors’ report.*




F-15




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





**NOTE
      7 - RELATED PARTY TRANSACTIONS (CONTINUED)**





**B)**
            **WRITE-OFF
                OF DEFERRED TRANSACTION COSTS IN CONNECTION WITH TERMINATION OF
                UNSUCCESSFUL PRE-EXISTING MERGER AGREEMENT BETWEEN GL ENERGY AND
                AMERICAN
                SOUTHWEST**





On
      March
      10, 2006, GL Energy’s board of directors approved the termination of an
      Agreement and Plan of Reorganization dated as of October 13, 2004 (the “Merger
      Agreement”). Pursuant to the Merger Agreement, all of American Southwest’s
      outstanding shares were to be converted into shares of GL Energy’s capital
      stock, with American Southwest being the surviving corporation. Although the
      Merger Agreement was executed, certain closing conditions were never satisfied,
      including the successful filing of a certificate of merger with the Delaware
      Secretary of State and as such the merger was never consummated. The Board
      of
      Directors of the Company deemed it in the best interest of GL Energy and its
      stockholders to terminate the Merger Agreement, and to enter into the
      transaction described below.





During
      the year ended April 30, 2005 American Southwest incurred $183,900 of deferred
      transaction costs in connection with the transaction. Below is a summary of
      the
      $183,900 of deferred transaction costs:




Facilitation
                  fee incurred to Donald Byers
              
              $
              150,000Legal
                  and other professional fees
              
              
              26,780Transfer
                  agent fees
              
              
              5,878Other
              
              
              1,242$
              183,900




As
      a
      result of the March 10, 2006 GL Energy Board resolution, these costs were
      written off to expense during the year ended April 30, 2006, of which $150,000
      represents and is classified as “related party consulting fees and services” in
      the consolidated financial statements. The other items are included in “general
      and administrative expenses” in those statements..





**(C)**
            **RELATED
                PARTY CONSULTING FEES AND SERVICES**





The
      Company has also incurred related party consulting fees and services of $32,000
      during the year ended April 30, 2006 to Robert Guillerman, former President
      of
      American Southwest.





The
      Company has also incurred related party consulting fees and services of $99,295
      during the year ended April 30, 2006 to David Michery, CEO of American
      Southwest.





The
      Company has also incurred related party consulting fees and services of $42,500
      during the year ended April 30, 2006 to Marcus Sanders, former COO of American
      Southwest.





The
      Company has also incurred related party consulting fees and services of $25,000
      during the year ended April 30, 2006 to Kent Puckett, CFO of American
      Southwest.





Accordingly,
      related party consulting fees and services totaled $348,975 and $0 during the
      year ended April 30, 2006 and the period from inception (July 1, 2004) through
      April 30, 2005, respectively, and $348,975 for the period from inception of
      the
      development stage (July 1, 2004) to April 30, 2006, including the $150,000
      incurred to Donald Byers described in (B) above.




*See
      registered independent auditors’ report.*




F-16




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





**NOTE
      7 - RELATED PARTY TRANSACTIONS (CONTINUED)**





**(D)**
            **LOSS
                INCURRED ON LEGAL SETTLEMENT ON BEHALF OF ENTITY FORMERLY OWNED BY
                SIGNIFICANT COMPANY
                STOCKHOLDER**





In
      May
      2005, Vestcom, Ltd. filed suit against American Southwest and its officers.
      The
      lawsuit arose from a loan made by Vestcom on or about July 3, 2003 in the amount
      of $500,000 to American Music Corporation, Inc. (“AMC”). Vestcom alleged that
      AMC fraudulently transferred its assets which principally included the Music
      Catalogue (“Subject Assets”) to Celestial, which was owned and controlled by the
      Company’s Chief Executive Officer, David Michery. American Southwest contended
      that none of its assets previously belonged to AMC.





Vestcom,
      Ltd. was seeking not less than $1.2 million from all the defendants, including
      American Southwest, to be awarded ownership of all subject assets, punitive
      damages, and other remuneration.





On
      July
      12, 2006 American Southwest reached a settlement with Vestcom whereby American
      Southwest agreed to pay Vestcom as follow: $500,000, which represents the
      principal amount of the above loan made by Vestcom on or about July 3, 2003,
      plus interest thereon at the rate of 9.5% from July 3, 2003 through to the
      closing date of the settlement. The closing date of the settlement is expected
      to be no later than September 15, 2006. In addition, American Southwest agreed
      to pay to Vestcom $360,000 as a supplemental damages payment and $250,000 for
      legal fees and expenses incurred by Vestcom. Assuming that September 15, 2006
      is
      the closing date, the total amount will be $1,244,583 which includes accrued
      interest to the date of the settlement, which has been accrued by the Company
      as
      of April 30, 2006, with a commensurate loss reflected in the Company’s
      consolidated statement of operations for the year then ended since the Company
      is absorbing the loss on behalf of the entity formerly owned by David
      Michery.





Assuming
      the settlement closing takes place as planned, American Southwest will issue
      a
      promissory note to Vestcom which will bear interest at 9.5%. The note will
      be
      payable as follows: $150,000 payable at the closing date, which will be applied
      to the final payments of interest on the note, $250,000 payable on or before
      January 1, 2007, and the balance of $1,102,772 payable in 8 equal installments
      paid quarterly in the amount of $137,847.





The
      note
      will also be convertible in whole or in part at any time into American
      Southwest’s common stock at 90% of the average bid price for the 5 days
      immediately prior to conversion. American Southwest is also to secure its
      obligation with a lien on all of its assets, which apparently will be junior
      in
      position to the obligation to Pegasus described in Note 5 above. David Michery
      has agreed to personally guarantee this settlement should American Southwest
      breach any of its obligations.





The
      company’s ability to exploit the Music Catalogue received from Celestial is
      dependent on the Settlement closing taking place as planned and the Company’s
      meeting the scheduled payments as due, in particular the $250,000 due in January
      1, 2007.





**(E)**
            **OTHER
                RELATED PARTY AMOUNTS**





At
      April
      30, 2005, the Company had a loans receivable of $15,142 from David Michery,
      the
      Company’s Chief Executive Officer. The loan was non-interest bearing and due on
      demand.




*See
      registered independent auditors’ report.*




F-17




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





**NOTE
      8 - STOCK INCENTIVE PLAN**





In
      2004,
      the Board of Directors of GL Energy adopted a 2004 Stock Incentive Plan (‘the
      plan’) under which 35,000,000 shares of GL Energy’s common stock have been
      reserved for issuance to employees, officers, directors and consultants whose
      past, present and/or potential contributions to GL Energy have been, or will
      be
      important to the success of GL Energy.





Options
      granted under the Plan may be either incentive stock options or nonqualified
      stock options. Incentive stock options (“ISO”) may be granted only to GL Energy
      employees (including officers and directors who are also employees).
      Nonqualified stock options (“NSO”) may be granted to GL Energy employees and
      consultants. Options under the Plan may be granted for periods of up to ten
      years and at an exercise price equal to the estimated fair value of the shares
      on the date of grant as determined by the Board of Directors, provided, however,
      that the exercise price of an ISO and NSO granted to a 10% shareholder shall
      not
      be less than 110% of the estimated fair value of the shares on the date of
      grant. To date, options granted generally are exercisable immediately as of
      the
      effective date of the option agreement.





During
      2004, 3,000,000 one year options were granted to two consultants. The exercise
      price was $.01 and all 3,000,000 vested immediately. The options were exercised
      prior to the effective date of the merger and reflected in the pre-merged
      entities financial statements. No options were granted during 2006 or 2005
      and
      there are no options outstanding at April 30, 2006.





**NOTE
      9 - EQUITY PERFORMANCE PLAN**





In
      February 2004, the Board of Directors of GL Energy adopted a 2004 Equity
      Performance Plan under which 10,000,000 shares of GL Energy’s common stock have
      been reserved for issuance to employees, officers, directors and consultants
      whose past, present and/or potential contributions to GL Energy have been,
      or
      will be important to the success of GL Energy. As of April 30, 2006, no common
      shares have been issued under this plan.





**NOTE
      10 - AGREEMENTS WITH UNIVERSAL RECORDS**





On
      January 25, 2006, American Southwest entered into an exclusive manufacturing
      and
      distribution agreement (“Domestic Distribution Agreement”) with Universal
      Records, a division of UMG Recordings, Inc. (“Universal”). Pursuant to this
      agreement, Universal will sell American Southwest’s music products, including
      compact discs, cassettes, and digital versatile discs to consumers mainly
      through retailers and wholesalers in the United States and Canada. During the
      term of the Domestic Distribution Agreement, Universal will be American
      Southwest’s exclusive manufacturer and distributor, through every distribution
      channel of recorded music in the United States and Canada. Universal will also
      exclusively handle all of American Southwest’s on-line sales during the term of
      the Domestic Distribution Agreement.





In
      exchange for its distribution services, through normal retail channels,
      Universal is entitled to a distribution fee equal to twenty five percent (25%)
      of American Southwest’s net billings. After the end of the calendar month, where
      American Southwest’s cumulative net billings exceed $8,000,000, Universal’s
      distribution fee will be twenty two and one half percent (22.5%) of American
      Southwest’s net billings. After the end of the calendar month, in which American
      Southwest’s cumulative net billings exceeds $15,000,000, Universal’s
      distribution fee will be twenty percent (20%) of American Southwest’s net
      billings. According to the Domestic Distribution Agreement, net billings means
      the cumulative wholesale price for sale of American Southwest’s products, less
      actual returns and credits to customers for such returns for the applicable
      accounting period.




*See
      registered independent auditors’ report.*




F-18




**GL
      ENERGY AND EXPLORATION, INC.**


**(NOW
      KNOWN AS AMERICAN SOUTHWEST MUSIC DISTRIBUTION, INC.)**


**(A
      DEVELOPMENT STAGE COMPANY)**


**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





**NOTE
      10 - AGREEMENTS WITH UNIVERSAL RECORDS (CONTINUED)**





In
      consideration for Universal’s services related to sales of American Southwest’s
      products in the United States and Canada, through channels other than normal
      retail channels, Universal shall be entitled to a licensing fee equal to fifteen
      percent (15%) of American Southwest’s net licensing billings. According to the
      Domestic Distribution Agreement, net licensing billings mean royalties or flat
      payments received by Universal, on American Southwest’s behalf, attributed to
      sales, other than sales through normal retail channels.





The
      Domestic Distribution Agreement became effective January 25, 2006 and will
      continue until January 25, 2008. Universal has the right to extend the term
      of
      the Domestic Distribution Agreement for an additional two years, until January
      25, 2010.





On
      January 25, 2006, American Southwest entered into another agreement with
      Universal “(Upstream Agreement”) pursuant to which American Southwest granted
      Universal the right to enter into exclusive recording services contracts with
      recording artists that have recording contracts with American Southwest, and
      whose performances are featured on albums distributed by Universal, on American
      Southwest’s behalf, that achieve sales in the United States equal to or in
      excess of 25,000 units.





On
      January 25, 2006, American Southwest entered into the Exclusive Foreign License
      Agreement (“Foreign License Agreement”) with Universal. The term of the Foreign
      License Agreement runs simultaneously with the term of the Domestic Distribution
      Agreement. During the term of the Foreign License Agreement, Universal has
      the
      exclusive right to sell, license or otherwise exploit records and videos that
      its distributes under the Domestic Distribution Agreement through the rest
      of
      the universe, excluding the United States.





**NOTE
      11- SUBSEQUENT EVENTS**





On
      May
      5 th ,
      2006 , the
      Company received the proceeds of an additional $150,000 borrowing from
      Generation Leasing, Inc. and the Company issued its promissory note that was
      due
      and payable on December 30, 2006. The note called for a monthly payment of
      $1,875, which represents interest only calculated on an annual interest rate
      of
      15%. All assets of the Company, including intangibles, patents, and purchase
      contracts, were pledged as security for repayment.





On
      August
      4, 2006 the Company received the proceeds of an additional $150,000 borrowing
      from Generation Leasing, Inc. This August 4, 2006 note, the May 5, 2006 $150,000
      note described above, plus the three other $150,000 Generation Leasing,
      Inc.  notes
      described in Note 5 were cancelled by the holder and consolidated into one
      $750,000 note pursuant to the Company’s agreement to do so. The terms of this
      new note calls for monthly payments of interest only of $9,375, which is
      calculated at a rate of 15%. The note is due December 30, 2006. All assets
      of
      the Company, including intangibles, patents, and purchase contracts, remain
      pledged as security for repayment of the new note.





Effective
      August 24, 2006 the Company is now traded on the OTC Bulletin board under the
      symbol “ASWD.OB.”




*See
      registered independent auditors’ report.*





F-19


**Item
      8. Changes In and Disagreements With Accountants on Accounting and Financial
      Disclosure.**





On
      August
      11, 2006, we dismissed Malone & Bailey PC as our independent accountants,
      and we engaged KBL, LLP as our independent accountants.





The
      reports of Malone & Bailey PC on the financial statements of GL Energy &
Exploration, Inc. for the fiscal years ended December 31, 2005 and 2004 did
      not
      contain an adverse opinion or a disclaimer of opinion, nor were such reports
      qualified or modified as to uncertainty, audit scope or accounting principles,
      except that the accountant’s reports of Malone & Bailey PC on our financial
      statements for the fiscal years ended December 31, 2005 and 2004 stated that
      we
      had recurring losses from operation and a working capital deficiency which
      raised raised substantial doubt about our ability to continue as a going
      concern.





The
      d ecision
      to change accountants from Malone & Bailey PC to KBL, LLP was approved by
      our board of directors. KBL, LLP was American’s auditor prior to its acquisition
      by GL Energy pursuant to the Exchange Agreement on March 13, 2006 and KBL,
      LLP
      audited American’s financial statements for the year ended April 30, 2005 which
      were included in GL Energy’s current report on Form 8K filed with the Commission
      on March 14, 2006.





During
      our fiscal years ended December 31, 2004 and 2005 and April 30, 2006 (after
      our
      change in fiscal year) and the subsequent interim period through August 11,
      2006, the date of the dismissal of Malone & Bailey PC, we did not have any
      disagreement with Malone & Bailey PC on any matter of accounting principles
      or practices, financial statement disclosure, or auditing scope or procedure,
      except as follows:





Malone
      & Bailey PC expressed concern with the accounting principles applied to the
      valuation of intangible assets acquired by American in exchange for shares
      of
      its own common stock issued to a control person, or an entity owned by that
      control person. Malone and Bailey PC refers to Staff Accounting Bulletin
      SAB.T.5G. “Transfers of Non-monetary Assets by promoters or Shareholders” which
      indicates that the transfer of assets to a company by its promoters or
      shareholders in exchange for stock prior to or at the time of the company’s
      initial public offering should normally be recorded at the transferor’s cost
      basis determined under GAAP. Malone & Bailey stated their opinion that the
      intangible assets were recorded at an estimated fair value which does not
      represent the transferor’s cost and that the audited financial statements as of
      and for the year ended April 30, 2005 included in GL Energy’s Current Report on
      Form 8-K dated March 10, 2006 to announce the merger of the two companies (GL
      Energy and American) are misleading and need to be restated.





KBL,
      LLP
      previously audited American’s financial statements for the period ended April
      30, 2005, which period encompassed the transaction which Malone & Bailey
      expressed concern above. The intangible assets discussed above by Malone &
Bailey were recorded at the transferor’s cost basis that was reflected on the
      transferor’s internal financial statements and corporate income tax returns.
      Accordingly, KBL had previously determined the valuation of intangibles as
      accurate per their previous audit and applied the Staff’s Guidance under SABT 5G
      in applying the transferors cost basis as discussed above.





Other
      than the matters discussed above, there have been no “reportable events” as set
      forth in Item 304(a)(1)(i-v) of Regulation S-B adopted by the Securities and
      Exchange Commission




We
      engaged KBL, LLP on August 11, 2006. As stated above, KBL, LLP previously
      audited American’s financial statements for the period ended April 30, 2005,
      Since the transaction pursuant to which GL Energy acquired American has been
      accounted for as a reverse acquisition with American being treated as the
      acquirer for accounting purposes, our management and our board determined it
      appropriate to engage American’s accountants as our independent auditor. This
      engagement was approved by our board of directors. While we did not specifically
      consult KBL, LLP regarding any of the matters specified in Item 304(a)(2) of
      Regulation S-B, KBL LLP has previously audited the valuation of the intangible
      assets acquired by American and agreed with American’s valuation contained in
      their audited statements for the period ended April 30, 2005.





We disagree with Malone & Bailey’s assessment that the assets were estimated at
      fair value. We contend that American used the “Transferor’s Cost Basis” to
      determine the value for the subject intangible assets. We discussed this matter
      with our Board and with American’s auditor. This matter was fully discussed in
      connection with American’s audit for the period ended April 30, 2005. American’s
      cost basis was determined based on the actual advances disbursed to artists.
      KBL, LLP advised us that they tested over 80% of the asset value as part of
      their audit of the assets. Their test of transactions included tracing the
      basis
      of over 80% of the dollar value of the assets to the dollar value of the advance
      received by the artist as recorded on the artists’ contracts as well as tracing
      the dollar amounts to our books and records, and cancelled checks. They found
      no
      discrepancies in their sample. Further, given that Malone and Bailey was
      provided with no documentation related to the asset amount, we do not understand
      how they were able to make an assertion that the asset was being recorded at
      fair market value. Accordingly, management does not believe that any statements
      contained in American’s audit for the period ended April 30, 2005 (and contained
      herein) were misleading nor do we believe they need to be restated. In addition,
      we are continuing discussions with Malone & Bailey and have agreed to
      provide them with additional information which we believe will alleviate
      concerns. We hope to resolve this disagreement in the near future in which
      case
      an amendment to this Current Report on 8-K will be filed disclosing the
      same.




21




We
      have
      provided Malone & Bailey PC with a copy of this disclosure prior to its
      filing with the Commission. As of the date of this report, Mantyla McReynolds,
      LLC has not provided any response to this disclosure.





**Item
      8A. Controls and Procedures.**





We
        maintain disclosure controls and procedures that are designed to ensure that
        information required to be disclosed in its Exchange Act reports is recorded,
        processed, summarized and reported within the time periods specified in the
        SEC's rules and forms, and that such information is accumulated and communicated
        to our management, including our Chief Executive Officer and Chief Financial
        Officer, as appropriate, to allow timely decisions regarding required disclosure
        based closely on the definition of "disclosure controls and procedures" in
        Rule
        13a−15(e). In designing and evaluating the disclosure controls and procedures,
        management recognized that any controls and procedures, no matter how well
        designed and operated, can provide only reasonable assurance of achieving
        the
        desired control objectives, and management necessarily was required to apply
        its
        judgment in evaluating the cost−benefit relationship of possible controls and
        procedures.
 
 At
        the
        end of the period covered by this Annual Report, we carried out an evaluation,
        under the supervision and with the participation of our management, including
        our Chief Executive Officer and Chief Financial Officer, of the effectiveness
        of
        the design and operation of the Company's disclosure controls and procedures.
        Based upon the foregoing, our Chief Executive Officer and Chief Financial
        Officer concluded that, as of April 30, 2006, the disclosure controls and
        procedures of the Company were effective to ensure that the information required
        to be disclosed in the Company's Exchange Act reports was recorded, processed,
        summarized and reported on a timely basis.


There were no changes in internal controls over financial reporting that
      occurred during the fiscal quarter ended April 30, 2006, that have materially
      affected, or are reasonably likely to materially affect, our internal control
      over financial reporting.





**Item
      8B. Other Information.**





None.





22


**PART
      III**





**Item
                9.**
            **Directors,
                Executive Officers, Promoters And Control Persons; Compliance With
                Section
                16(A) Of The Exchange Act**





**Executive
      Officer and Directors**





The
      directors and executive officers currently serving the Company are as
      follows:


**Name**
              **Age**
              **Position**David
                  Michery
              38
              Chief
                  Executive Officer, President, DirectorKent
                  Puckett
              40
              Chief
                  Financial Officer, Secretary, Treasurer, Director




**David
      Michery** has
      served as our Chief Executive Officer and Director since October 2004. Mr.
      Michery has worked in the music business for 17 years. His area's of expertise
      include, but are not limited to, domestic distribution, intellectual properties,
      music publishing, copyrights; licensing, international distribution, sales,
      marketing and promotion. He was Chief Executive Officer and President of
      American Southwest Music Distribution since its inception in June 2004. He
      was
      the founder and Chief Executive Officer of AMC American Music Corporation from
      September 1999 to May 2004. He was also President of Celestial Breakaway
      Entertainment from October 1996 to October 1998.





**Kent
      Puckett** has
      served as our Chief Financial Officer, Secretary and Treasurer since October
      2004 and as a Director since May 2005. Mr. Puckett has been an accountant for
      15
      years and has accounting, tax and financial experience in corporations, mergers
      and acquisitions, intellectual property, copyrights and licensing in the
      entertainment industry. From 1999 to 2003 he worked for A-1 Business Service
      with a focus on clients in the entertainment industry and as a tax specialist.
      From January 2004 to the present he has been working for Direct Business Service
      as an entertainment accountant and tax specialist, corporate structure advisor,
      financial analyst, and financial transaction specialist. Mr. Puckett is also
      a
      part owner of this business. Mr. Puckett received a Bachelors degree in Business
      Administration from Pensacola Christian College.





**Audit
      Committee**





We
      do not
      have an audit committee at this time.





**Section
      16(a) Beneficial Ownership Reporting Compliance**





Section 16(a)
      of the Securities Exchange Act of 1934, as amended, requires our directors,
      executive officers, and stockholders holding more than 10% of our outstanding
      common stock, to file with the Securities and Exchange Commission initial
      reports of ownership and reports of changes in beneficial ownership of our
      common stock. Executive officers, directors and greater-than-10% stockholders
      are required by SEC regulations to furnish us with copies of all
      Section 16(a) reports they file. To our knowledge, based solely on review
      of the copies of such reports furnished to us for the period ended April 30,
      2006, no Section 16(a) reports required to be filed by our executive
      officers, directors and greater-than-10% stockholders were filed on a timely
      basis.





**Item
      10. Executive Compensation**





Set
      forth
      below is information for our Chief Executive Officer for the years ended April
      30, 2006 and 2005. No other officer received compensation in excess of $100,000
      for 2006 or 2005.




23




**Annual
                Compensation**
            
            **Long-Term
                Compensation****Common
                Shares****Underlying**
            
            **All****Restricted**
            
            **Options**
            
            **Other****Other
                Annual**
            
            **Stock**
            
            **Granted**
            
            **Compen****Name
                and Position**
            
            **Year**
            
            **Salary**
            
            **Bonus**
            
            **Compensation**
            
            **Awards
                ($)**
            
            **(#
                Shares)**
            
            **-sation**David
                Michery
            
            2006
            
            $99,295
            
            -0-
            
            $---
            
            -0-
            
            ------
            
            -0-*President,
                  Chief Executive Officer and Director*
            
            2005
            
            $76,206
            
            -0-
            
            $---
            
            -0-
            
            ------
            
            -0-(as
                  of October 2004)




In
      the
      next twelve months, we intend to enter into employment agreements with each
      of
      our executive officers at an annual salary to be determined based on their
      then
      levels, time devoted and the scope of their responsibilities. In addition to
      cash compensation, we intend to use shares of our common stock, and options
      to
      purchase shares of its common stock to compensate its officers. In addition,
      we
      may use common stock to compensate others for services provided.





There
      is
      no plan in place for compensation of persons who are salary directors, but
      it is
      expected that in the future that we will create a remuneration and reimbursement
      plan for such directors.





**Other
      Compensation Arrangements**





In
      March
      2004, a majority of our shareholders approved an equity performance plan for
      10,000,000 shares of common stock ("2004 Equity Performance Plan"), and in
      October 2004, the board of directors approved the registration of an additional
      35,000,000 shares of common stock on form S-8 for the purpose of having shares
      of common stock available to compensate directors, consultants, employees,
      management and others for services. The rights of the common stock were not
      changed. We intend to issue the shares of common stock from time to time as
      determined by the board of directors to directors, employees, management,
      consultants and others. The Company’s board of directors believes the 2004
      Equity Performance Plan, and the additional 35,000,000 shares of common stock
      will provide flexibility in structuring compensation arrangements and provide
      an
      equity incentive for employees and others who are awarded these shares. These
      shares may be issued at less than market price at the discretion of the board
      of
      directors. None of the shelf-registered shares are allocated to any particular
      person or class of persons among those eligible to receive awards. As of March
      2006, GL Energy has issued a total of 4,500,000 shares of common stock to
      various consultants and employees.





**Compensation
      of Directors**





All
      directors receive reimbursement for reasonable out-of-pocket expenses in
      attending board of directors meetings and for promoting our business. From
      time
      to time we may engage certain members of the board of directors to perform
      services on our behalf. In such cases, we compensate the members for their
      services at rates no more favorable than could be obtained from unaffiliated
      parties.





**Item
      11. Security Ownership of Certain Beneficial Owners and
      Management.**





The
      following table sets forth certain information regarding the beneficial
      ownership of our common stock as of September 19, 2006 (and reflects our recent
      1-for-74 reverse split) by the following persons:





·
            each
                person who is known to be the beneficial owner of more than five
                percent
                (5%) of our issued and outstanding shares of common
                stock;


·
            each
                of our directors and executive officers;
                and


·
            all
                of our directors and executive officers as a
                group.





24


Except
      as
      set forth in the footnotes to the table, the persons names in the table have
      sole voting and investment power with respect to all shares of common stock
      shown as beneficially owned by them, subject to community property laws where
      applicable. A person is considered the beneficial owner of any securities as
      of
      a given date that can be acquired within 60 days of such date through the
      exercise of any option, warrant or right. Shares of common stock subject to
      options, warrants or rights which are currently exercisable or exercisable
      within 60 days are considered outstanding for computing the ownership percentage
      of the person holding such options, warrants or rights, but are not considered
      outstanding for computing the ownership percentage of any other person.





**Name
                And Address (1)**
            
            **Number
                Of Shares**
              **Beneficially
                Owned**
            
            **Percentage
                Owned (2)**David
                Michery (3)
            
            7,581.689
            
            92.5%Kent
                Puckett (4)
            
            823,716
            
            48.9%Donald
                Byers
              #300
                - 1497 Marine Drive
              West
                Vancouver, BC Canada
              V7T
                1B8
            
            218,787
            
            24.5%All
                directors and officers as a group (2 persons)
            
            8,405,405
            
            93.5%


----------------------------------------------


*
      Less
      than 1% of the outstanding shares of common stock.





(1)
            Unless
                otherwise noted, the address for each person is 8721 Sunset Blvd.,
                Penthouse 7, West Hollywood, California
                90069.





(2)
            Based
                on 8,992,933 common shares issued and
                outstanding.


(3)
              Mr.
                  Michery is our President and Chief Executive
                  Officer.
 (4)
                Mr.
                    Puckett is our Chief Financial
                    Officer.


**Item
      12. Certain Relationships and Related Transactions.**





In
      March
      2006, the Company and American consummated the Exchange Agreement pursuant
      to
      which the Company issued 22,500,000 shares of its common stock and 23,980 shares
      of its series A preferred stock to the stockholders of American in exchange
      for
      all of their capital stock in American. David Michery and Kent Puckett, the
      Company’s officers and directors, were the sole stockholders of American.
      Messrs. Michery and Puckett were appointed as officers of the Company in October
      2004 in connection with the original Merger Agreement entered into between
      the
      Company and American. The Merger Agreement was never consummated and recently
      terminated.





Byers
      and
      Associates advanced money to American and the Company in the form of a loan
      represented in a promissory note in the amount $49,009. Donald Byers is the
      sole
      owner of Byers and Associates and owns 16,190,000 of the Company’s common stock.
      At the time of the loan, Donald Byers was the majority shareholder of the
      Company. The loaned funds were used to pay expenses for both the Company and
      American. The original loan principal in January 2005 was $23,500, and the
      principal was due April 30, 2005. Byers and Associates loaned additional funds
      to American and the Company bringing the balance to $38,092.57. As American’s
      and the Company’s consideration for Byers and Associates’ agreement to renew the
      loan that was in default, American and the Company agreed to increase the
      principal due to $49,009.00, to include unpaid interest due and to take into
      consideration fluctuations in the exchange rate between the United States and
      Canada since the original date of the loan. Byers and Associates agreed to
      extend the due date of the loan to February 28, 2006. The Promissory Note was
      a
      zero coupon promissory note. If American and the Company fail to pay the
      principal on the Note or any other Note issued to Byers and Associates on or
      before their due date the promissory note will be considered in default. If
      the
      promissory note is in default, the entire balance of the loan principal, then,
      outstanding, shall bear interest at the rate of 10% per annum.  Such
      interest shall accrue from the date of the promissory note until the promissory
      note is paid. This note is currently in default.




25




Byers
      and
      Associates advanced money to American in the form of a loan represented in
      a
      promissory note in the amount $16,592. Donald Byers is the sole owner of Byers
      and Associates and owns 16,400,000 of the Company’s common stock. At the time of
      the loan, Donald Byers was the majority shareholder of the Company. The loaned
      funds were used to pay expenses for American. The promissory note was due and
      payable on February 28, 2005. The Promissory Note was a zero coupon promissory
      note. If American fails to pay the principal on the Note or any other Note
      issued to Byers and Associates on or before their due date, the promissory
      note
      will be considered in default. If the promissory note is in default, the entire
      balance of the loan principal, then, outstanding, shall bear interest at the
      rate of 10% per annum.  Such interest shall accrue from the date of the
      promissory note until the promissory note is paid. This note is currently in
      default.





In
      September 2004, American entered into an agreement with Donald Byers, in his
      capacity as the majority shareholder of the Company. Pursuant to the agreement,
      in September 2004, American paid Mr. Byers $150,000. As consideration for
      American’s payment, Messrs. Byers and Frank Rossi resigned from the Company’s
      board of directors and appointed Marcus Sanders and David Michery to the
      Company’s board of directors. As additional consideration, Mr. Byers approved
      the Merger Agreement and cooperated and provided assistance in connection with
      the same.





In
      September 2004, as additional consideration for Mr. Byer’s cooperation and
      assistance, American agreed to pay Mr. Byers an additional $50,000, on the
      date
      that is sixty (60) days, after the Closing date of the Reorganization Agreement.
      Pursuant to the same agreement, American also agreed to pay the Company’s
      Current Liabilities, as of the date of the agreement, in the aggregate amount
      of
      $126,925.00 (the sum of Accounts Payable in the amount of $30,000, and debts
      Due
      to Shareholders in the amount of $96,925). Pursuant to this agreement, David
      Michery unconditionally and irrevocably guaranteed the payments when due, and
      granted to Mr. Byers a security interest in 1,250,000 shares of the Compay’s
      common stock that shall be issued to Mr. Michery pursuant to the Reorganization
      Agreement. Mr. Michery’s obligation to make such guarantee and provide such
      security to Mr. Byers was conditioned upon the close of the Reorganization
      Agreement.





In
      August
      2004, Mr. Michery loaned American $20,877 for working capital. To evidence
      the
      loan, we issued a promissory note with an interest rate of 5.5%. This note
      is
      currently in default.





In
      August
      2004, American entered into an Asset Purchase Agreement with Celestial Breakaway
      Records pursuant to which we purchased all of their assets in exchange for
      3,746
      shares of our common stock. Their assets were valued at $3,746,000. David
      Michery and Kent Puckett, American’s officers and directors, were the sole
      stockholders of Celestial Records.





In
      August
      2004, American entered into an Asset Purchase Agreement with Out of Control
      Records pursuant to which we purchased all of their assets in exchange for
      470
      shares of our common stock. Their assets were valued at $470,000. David Michery
      and Kent Puckett, American’s officers and directors, were the sole stockholders
      of Out of Control Records.





On
      June
      1, 2004, the Company entered into a management services agreement with Wellstar
      International, Inc. (`Wellstar") pursuant to which Wellstar agreed to provide
      management services and office facilities on an ongoing basis for $10,000 per
      month for the 12-month period ending May 31, 2005. This agreement was terminated
      in September 2004. The Company's former President and Chairman, Donald Byers,
      was the sole director of Wellstar.





In
      June
      2003, the Company entered into an agreement with its then President and
      Chairman, Donald Byers, pursuant to which it agreed to pay him $8,000 per month
      as compensation and office rental through May 2004. These management fees have
      been paid through May 2004 and the agreement was terminated.





In
      June
      2003, the Company issued 20,000,000 shares of common stock valued at $20,000
      to
      two directors for an investment in a mining claim in Chile. These shares were
      issued to two individuals, as follows: Donald Byers - 17,500,000 and Arthur
      Lang
      - 2,500,000. These issuances were exempt under Section 4(2) of the Securities
      Act of 1933, as amended.





26





**Item
      13. Exhibits.**





Exhibit
                  No.
              Description2.1
              Securities
                  Purchase Agreement and Plan of Reorganization (2)4.1
              Certificate
                  of Designation of the Series A Preferred Stock (2)4.2
              Form
                  of 2003 Equity Performance Plan (2)4.3
              Form
                  of 2004 Equity Performance Plan (2)4.4
              Form
                  of 2004 Stock Incentive Plan (2)4.5
              Certificate
                  of Amendment to Certificate of Incorporation (2)10.1
              Domestic
                  Distribution Agreement (2)10.2
              Upstream
                  Agreement (2)10.2
              Foreign
                  License Agreement (2)21
              Subsidiaries
                  (2)23.1
              Consent
                  of KBL, LLP (1)31.1
              Certification
                  of Chief Executive Officer, pursuant to Rule 13a-14(a) of the Exchange
                  Act, as enacted by Section 302 of the Sarbanes-Oxley Act of 2002.
                  (1)31.2
              Certification
                  of Chief Financial Officer, pursuant to Rule 13a-14(a) of the Exchange
                  Act, as enacted by Section 302 of the Sarbanes-Oxley Act of 2002.
                  (1)32.1
              Certification
                  of Chief Executive Officer and Chief Financial Officer, pursuant
                  to 18
                  United States Code Section 1350, as enacted by Section 906 of the
                  Sarbanes-Oxley Act of 2002.
                  (1)


(1)
      Filed
      herewith.


(2)
      Previously filed.





**Item
      14. Principal Accountant Fees and Services.**





**Appointment
      of Auditors**




Our
      Board
      of Directors selected KBL, LLP, certified public accountants, as our auditors
      for the year ended April 30, 2006.





**Audit
      Fees**





KBL,
      LLP,
      billed us $25,000 in fees for our annual audit for the year ended April 30,
      2006, and $0 in fees for the review of our quarterly financial statements
      for that year.





**Audit-Related
      Fees**




KBL,
      LLP,
      billed us $ -0- for assurance and related services in 2006 and are not reported
      under Audit Fees above.





**Tax
      and All Other Fees**




We
      did
      not pay any fees to KBL, LLP for tax compliance, tax advice, tax planning or
      other work during our fiscal year ending April 30, 2006.





**Pre-Approval
      Policies and Procedures**





We
      have
      implemented pre-approval policies and procedures related to the provision of
      audit and non-audit services. Under these procedures, our board of directors
      pre-approves all services to be provided by KBL, LLP and the estimated fees
      related to these services.





With
      respect to the audit of our financial statements as of April 30, 2006 and the
      review of our quarterly financial statements for the year then ended, none
      of
      the hours expended on KBL LLP’s engagement to audit those financial statements
      were attributed to work by persons other than KBL LLP’s full-time, permanent
      employees.





27


**SIGNATURES**







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




**AMERICAN
              SOUTHWEST MUSIC DISTRIBUTION, INC. (f/k/a GL Energy & Exploration,
              Inc.)**By:
            /s/ David
              MicheryDavid
                Michery
              Chief
                Executive Officer





Pursuant
      to the requirements of the Securities Exchange Act of 1934, as amended, this
      report has been signed below by the following persons on behalf of the
      registrant and in the capacities indicated.


Signatures
              
              Title
              Date/s/
                  David Michery
              
              Chief
                  Executive Officer, President, Director
              September
                  20, 2006David
                  Michery/s/Kent
                  Puckett
              
              Chief
                  Financial Officer, Secretary, Treasurer, Director
              September
                  20, 2006Kent
                  Puckett




28