UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington
D.C. 20549





FORM
10-Q





(Mark
One)





x
            QUARTERLY
      REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the
quarterly period ended November 30,
2010





 ̈
            TRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
  ACT





For the
transition period from 
to





Commission
File Number 1-15913





UNITED STATES BASKETBALL
LEAGUE, INC.


(Exact
Name of Registrant as Specified in Its Charter)





Delaware
              06-1120072(State
      or Other Jurisdiction of
              (I.R.S.
      EmployerIncorporation
      or Organization)
              Identification
      Number)





183 Plains Road, Suite 2
Milford, Connecticut 06461


(Address
of Principal Executive Offices)





(203)
877-9508


(Registrant’s
Telephone Number, Including Area Code)





___________________________________________


(Former
Name, Former Address and Former Fiscal Year, if Changed


Since
Last Report)





Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the
preceding 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
 ̈





Indicate by check mark whether the
registrant has submitted electronically and posted on its corporate Web site, if
any, every Interactive Data File required to be submitted and posted pursuant to
Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required
to submit and post such files). Yes ̈No ̈





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer”, “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large
      accelerated filer   ̈
              Accelerated
      filer                    ̈Non-accelerated
      filer     ̈
                (Do
      not check if a smaller reporting
                company)
              Smaller
      reporting company  x




Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).    Yes  ̈     No
x





Indicate
the number of shares outstanding of each of the issuer’s classes of common stock
as of the latest practicable date.  As of January 12, 2011, there were
3,512,527 shares of Common Stock, $.01 par value per share,
outstanding.





UNITED
STATES BASKETBALL LEAGUE, INC.


INDEX





PAGEPART
      I.
                FINANCIAL
      INFORMATION
                3Item
      1.
                UNAUDITED
      FINANCIAL STATEMENTS.Consolidated
      Balance Sheets – November 30, 2010and February 28, 2010
                3Consolidated
      Statements of Operations for the three and nine months ended November 30,
      2010 and 2009
                4Consolidated
      Statement of Stockholders’ Deficiency
                5Consolidated
      Statements of Cash Flows for the nine months ended November 30, 2010 and
      2009
                6Notes
      to Consolidated Financial Statements
                7Item
      2.
                Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
                12Item
      3.
                Quantitative
      and Qualitative Disclosures About Market Risk
                13Item
      4.
                Controls
      and Procedures
                13PART
      II.
                OTHER
      INFORMATION
                14Item
      1.
                Legal
      Proceedings
                14Item
      6.
                Exhibits
                14


2


PART
I


FINANCIAL
INFORMATION





ITEM
1.                       CONSOLIDATED
FINANCIAL STATEMENTS.





UNITED STATES BASKETBALL
LEAGUE, INC. AND SUBSIDIARY




CONSOLIDATED BALANCE
SHEETS





November 30,
                      2010
                    
                    
                    February 28,
                      2010(Unaudited)ASSETSCURRENT
      ASSETS:Cash
      and cash equivalents
                    
                    $
                    1,873
                    
                    
                    $
                    661Marketable
      equity securities
                    
                    
                    252,281
                    
                    
                    
                    141,103Inventory
                    
                    
                    5,000
                    
                    
                    
                    5,000Due
      from related parties
                    
                    
                    10,500
                    
                    
                    
                    113,814Total
      current assets
                    
                    
                    269,654
                    
                    
                    
                    260,578PROPERTY,
      NET
                    
                    
                    238,108
                    
                    
                    
                    242,002Total
      assets
                    
                    $
                    507,762
                    
                    
                    $
                    502,580LIABILITIES AND STOCKHOLDERS’
      DEFICIENCYCURRENT
      LIABILITIES:Accounts
      payable and accrued expenses
                    
                    $
                    140,377
                    
                    
                    $
                    114,816Due
      in connection with South Korea venture
                    
                    
                    -
                    
                    
                    
                    20,000Credit
      card obligations
                    
                    
                    95,667
                    
                    
                    
                    96,711Due
      to related parties
                    
                    
                    1,777,257
                    
                    
                    
                    1,655,840Total
      current liabilities
                    
                    
                    2,013,301
                    
                    
                    
                    1,887,367Due
      to related parties, net of current portion
                    
                    
                    50,000
                    
                    
                    
                    50,000Total
      Liabilities
                    
                    
                    2,063,301
                    
                    
                    
                    1,937,367STOCKHOLDERS’
      DEFICIENCYCommon
      stock, $0.01 par value; 30,000,000 shares authorized;
      issued  3,522,502 and 3,522,502 shares,
    respectively
                    
                    
                    35,525
                    
                    
                    
                    35,225Preferred
      stock,  $0.01 par value; 2,000,000 shares authorized; 1,105,679
      shares issued and outstanding
                    
                    
                    11,057
                    
                    
                    
                    11,057Additional
      paid-in-capital
                    
                    
                    2,679,855
                    
                    
                    
                    2,668,155Deficit
                    
                    
                    (4,239,522
                    )
                    
                    
                    (4,106,770
                    )Treasury
      stock, at cost; 39,975 shares of common stock
                    
                    
                    (42,454
                    )
                    
                    
                    (42,454
                    )Total
      stockholders’ deficiency
                    
                    
                    (1,555,539
                    )
                    
                    
                    (1,434,787
                    )Total
      liabilities and stockholders’ deficiency
                    
                    $
                    507,762
                    
                    
                    $
                    502,580





See notes
to consolidated financial statements.


3





UNITED STATES BASKETBALL
LEAGUE, INC. AND SUBSIDIARY




CONSOLIDATED STATEMENTS OF
OPERATIONS


(Unaudited)





Three Months Ended
                      
                      
                      Nine Months EndedNovember 30,
                        2010
                      
                      
                      November 30,
                        2009
                      
                      
                      November 30,
                        2010
                      
                      
                      November 30,
                        2009REVENUES:Initial
      franchise fees
                      
                      $
                      -
                      
                      
                      $
                      -
                      
                      
                      $
                      -
                      
                      
                      $
                      -Continuing
      franchise fees
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      -Consulting
      fees
                      
                      
                      -
                      
                      
                      
                      4,000
                      
                      
                      
                      20,000
                      
                      
                      
                      12,000Sponsorship/advertising
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      -Other
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      --
                      
                      
                      
                      4,000
                      
                      
                      
                      20,000
                      
                      
                      
                      12,000OPERATING
      EXPENSES:Consulting
                      
                      
                      -
                      
                      
                      
                      500
                      
                      
                      
                      16,575
                      
                      
                      
                      4,200Referee
      fees
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      -Salaries
                      
                      
                      14,989
                      
                      
                      
                      13,636
                      
                      
                      
                      43,567
                      
                      
                      
                      42,803Travel
      and promotion
                      
                      
                      4,350
                      
                      
                      
                      6,908
                      
                      
                      
                      24,084
                      
                      
                      
                      19,442Depreciation
                      
                      
                      1,298
                      
                      
                      
                      1,298
                      
                      
                      
                      3,894
                      
                      
                      
                      3,894Other
                      
                      
                      35,265
                      
                      
                      
                      10,628
                      
                      
                      
                      84,476
                      
                      
                      
                      68,92655,900
                      
                      
                      
                      32,970
                      
                      
                      
                      172,594
                      
                      
                      
                      139,265Income
      (loss) from operations
                      
                      
                      (55,900
                      )
                      
                      
                      (28,970
                      )
                      
                      
                      (152,594
                      )
                      
                      
                      (127,265
                      )OTHER
      INCOME (EXPENSES):Net
      gain (loss) from marketable equity securities
                      
                      
                      63,800
                      
                      
                      
                      7,813
                      
                      
                      
                      44,513
                      
                      
                      
                      32,120Interest
      expense
                      
                      
                      (8,251
                      )
                      
                      
                      (8,414
                      )
                      
                      
                      (24,698
                      )
                      
                      
                      (25,694
                      )Interest
      and dividend income
                      
                      
                      1
                      
                      
                      
                      2
                      
                      
                      
                      27
                      
                      
                      
                      955,550
                      
                      
                      
                      (599
                      )
                      
                      
                      19,842
                      
                      
                      
                      6,435NET
      INCOME (LOSS)
                      
                      $
                      (350
                      )
                      
                      $
                      (29,569
                      )
                      
                      $
                      (132,752
                      )
                      
                      $
                      (120,830
                      )Earnings
      (loss) per common share:Basic
                      
                      $
                      (.00
                      )
                      
                      $
                      (.01
                      )
                      
                      $
                      (.04
                      )
                      
                      $
                      (.03
                      )Diluted
                      
                      $
                      (.00
                      )
                      
                      $
                      (.01
                      )
                      
                      $
                      (.04
                      )
                      
                      $
                      (.03
                      )WEIGHTED
      AVERAGE NUMBER OF COMMON SHARES OUTSTANDINGBasic
                      
                      
                      3,482,527
                      
                      
                      
                      3,482,527
                      
                      
                      
                      3,482,527
                      
                      
                      
                      3,482,527Diluted
                      
                      
                      4,588,206
                      
                      
                      
                      4,588,206
                      
                      
                      
                      4,588,206
                      
                      
                      
                      4,588,206





See notes
to consolidated financial statements.


4


UNITED
STATES BASKETBALL LEAGUE, INC. AND SUBSIDIARY


Consolidated
Statement of Stockholders’ Deficiency


(Unaudited)





CommonStock
                  
                  
                  PreferredStock
                  
                  
                  Additional
                  
                  
                  
                  
                  
                  
                  
                  
                  TotalShares
                  
                  
                  
                  
                  
                  Shares
                  
                  
                  
                  
                  
                  Paid-in
                  
                  
                  
                  
                  
                  TreasuryStock
                  
                  
                  Stockholders’Outstanding
                  
                  
                  Amount
                  
                  
                  Outstanding
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  Deficit
                  
                  
                  Shares
                  
                  
                  Amount
                  
                  
                  DeficiencyBalance,
      February 28, 2010
                  
                  
                  3,522,502
                  
                  
                  $
                  35,225
                  
                  
                  
                  1,105,679
                  
                  
                  $
                  11,057
                  
                  
                  $
                  2,668,155
                  
                  
                  $
                  (4,106,770
                  )
                  
                  
                  39,975
                  
                  
                  $
                  (42,454
                  )
                  
                  $
                  (1,434,787
                  )Shares
      issued for services
                  
                  
                  30,000
                  
                  
                  
                  300
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  11,700
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  12,000Net
      income (loss)
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (132,752
                  )
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (132,752
                  )Balance,
      November 30, 2010
                  
                  
                  3,552,502
                  
                  
                  $
                  35,525
                  
                  
                  
                  1,105,679
                  
                  
                  $
                  11,057
                  
                  
                  $
                  2,679,855
                  
                  
                  $
                  (4,239,522
                  )
                  
                  
                  39,975
                  
                  
                  $
                  (42,454
                  )
                  
                  $
                  (1,555,539
                  )




See notes
to consolidated financial statements


5


UNITED STATES BASKETBALL
LEAGUE, INC. AND SUBSIDIARY




CONSOLIDATED STATEMENTS OF
CASH FLOWS


(Unaudited)





Nine Months EndedNovember 30,
                  2010
                
                
                November 30,
                  2009CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      income (loss)
                
                $
                (132,752
                )
                
                $
                (120,830
                )Adjustments
      to reconcile net income(loss) to net cash provided by (used in) operating
      activities:Depreciation
                
                
                3,894
                
                
                
                3,894Non-cash
      compensation
                
                
                12,000
                
                
                
                -Changes
      in operating assets and liabilities:Marketable
      equity securities
                
                
                (111,178
                )
                
                
                (70,527
                )Accounts
      payable and accrued expenses
                
                
                25,561
                
                
                
                28,555Due
      in connection  with South Korea venture
                
                
                (20,000
                )
                
                
                (120,000
                )Deferred
      revenues
                
                
                -
                
                
                
                (37,000
                )Credit
      card obligations
                
                
                (1,044
                )
                
                
                (9,581
                )Net
      cash used in operating activities
                
                
                (223,519
                )
                
                
                (325,489
                )CASH
      FLOWS FROM FINANCING ACTIVITIES:Decrease
      (increase)  in due from related parties
                
                
                (15,469
                )
                
                
                39,717Increase
      (decrease) in due to related parties
                
                
                240,200
                
                
                
                281,063Net
      cash provided by financing activities
                
                
                224,731
                
                
                
                320,780NET
      INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                
                
                (1,212
                )
                
                
                (4,709
                )CASH
      AND CASH EQUIVALENTS, beginning of period
                
                
                661
                
                
                
                7,233CASH
      AND CASH EQUIVALENTS, end of period
                
                $
                1,873
                
                
                $
                2,524SUPPLEMENTAL
      DISCLOSURES OF CASH FLOW INFORMATION:Interest
      paid
                
                $
                12,998
                
                
                $
                13,994Income
      tax paid
                
                $
                -
                
                
                $
                -NON-CASH
      FINANCING ACTIVITY:Transfer
      of amounts due from related parties to USBL president in partial
      satisfaction of amount due to USBL president
                
                $
                118,783
                
                
                $
                -





See notes
to consolidated financial statements.


6





UNITED STATES BASKETBALL
LEAGUE, INC. AND SUBSIDIARY


NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS


NINE MONTHS ENDED NOVEMBER
30, 2009


(Unaudited)





1.           Description
of Business and Basis of Presentation:





United
States Basketball League, Inc. (“USBL”), incorporated in Delaware on May 29,
1984, has operated a professional summer basketball league through franchises
located in the United States.  Its wholly owned subsidiary
Meisenheimer Capital Real Estate Holdings, Inc. (“MCREH”) owns a commercial
building in Milford, Connecticut.  USBL cancelled its 2008, 2009, and
2010 seasons.





At
November 30, 2010, USBL and MCREH (collectively, the “Company”) had negative
working capital of $1,743,647, a stockholders’ deficiency of $1,555,539 and
accumulated losses of $4,239,522.  These factors, as well as the
Company’s reliance on related parties (see Notes 6 and 8), raise substantial
doubt as to the Company’s ability to continue as a going concern.





The
Company is making efforts to raise equity capital, revitalize the league and
market new franchises. However, there can be no assurance that the Company will
be successful in accomplishing its objectives.  The consolidated
financial statements do not include any adjustments that might be necessary
should the USBL be unable to continue as a going concern.





The
accompanying unaudited consolidated financial statements have been prepared by
the Company pursuant to the rules and regulations of the Securities and Exchange
Commission.  Accordingly, they may not include all of the information
and footnotes required by accounting principles generally accepted in the United
States for complete financial statements.  In the opinion of
management, the unaudited financial statements reflect all adjustments, which
include only normal recurring adjustments, necessary for a fair
presentation.  Operating results for the nine-month period ended
November 30, 2010 may not necessarily be indicative of the results that may be
expected for the year ending February 28, 2011.  The notes to the
consolidated financial statements should be read in conjunction with the notes
to the consolidated financial statements contained in the Company’s Form 10-K
for the year ended February 28, 2010.





2.           Summary
of Significant Accounting Policies:





Principles of
consolidation - The accompanying consolidated financial statements
include the accounts of USBL and MCREH.  All significant intercompany
accounts and transactions have been eliminated.





Fair value
disclosures –The carrying amounts of the Company’s financial
instruments, which consist of cash and cash equivalents, marketable equity
securities, due from related parties, accounts payable and accrued expenses, due
in connection with South Korea venture, credit card obligations, and due to
related parties, approximate their fair value due to their short term nature or
based upon values of comparable instruments.





Cash and cash
equivalents -The Company considers all highly liquid debt instruments
purchased with a maturity of three months or less to be cash
equivalents.


7





Marketable equity
securities–Marketable equity securities are recorded at fair value with unrealized
gains and losses included in income.  The Company has classified its
investment in marketable equity securities as trading securities.  The
change in net unrealized holding gain (loss) included in earnings for the three
months ended November 30, 2010 and 2009 and for the nine months ended November
30, 2010 and 2009 was $61,463, $(31,205), $60,455, and $(22,576),
respectively.





Inventory -Inventory consists of USBL trading cards, basketball uniforms, sporting
equipment and printed promotional material and is stated at the lower of cost or
market.  Certain inventory was obtained through barter transactions
whereby the USBL granted suppliers various advertising space (print) and airtime
(television) in return for the supplier’s products.  These
transactions were accounted for based upon the fair values of the assets and
services involved in the transactions.





Depreciation
expense -Depreciation is computed using the straight-line method over
the building’s estimated useful life (approximately 30 years).





Revenue
recognition -The Company generally uses the accrual method of accounting
in these financial statements.  However, due to the uncertainty of
collecting royalty and franchise fees from the franchisees, the USBL records
these revenues upon receipt of cash consideration paid or the performance of
related services by the franchisee.  Franchise fees earned in
nonmonetary transactions are recorded at the fair value of the franchise granted
or the service received, based on which value is more readily
determinable.  Upon the granting of the franchise, the Company has
performed essentially all material conditions related to the
sale.  The offering price of a new franchise at November 30, 2010 was
$50,000.





The
Company generates advertising revenue from fees for arena signage, tickets, and
program and year book advertising space. Advertising revenue is recognized over
the period that the advertising space is made available to the
user.





Fees
charged to teams to allow them to relocate are recognized as revenue upon
collection of the fee.  Souvenir sales, which are generated on the
Company’s web site, are recorded upon shipment of the
order.  Essentially all orders are paid by credit card.





Income
taxes - Deferred tax assets and liabilities are determined based on
differences between financial reporting and tax bases of assets and liabilities,
and are measured using the enacted tax rates
and laws that will be in effect when the differences are expected to
reverse.  A valuation allowance has been fully provided for the
deferred tax asset (approximating $800,000) resulting from the net operating
loss carryforward.





As of
February 28, 2010, the Company had a net operating loss carryforward of
approximately $2,000,000 available to offset future taxable
income.  The carryforward expires in varying amounts through year
ended February 28, 2030.





Estimates
– The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting
period.  Actual results could differ from those
estimates.





Advertising
costs - Advertising costs are expensed as incurred.


8





Stock-based
compensation - Stock compensation is accounted for at fair value in
accordance with Accounting Standards Codification (“ASC”) 718, “Compensation –
Stock Compensation.”  No stock options were granted during 2010 and
2009 and none are outstanding at November 30, 2010.





Comprehensive
income – Other comprehensive income (loss) refers to revenues, expenses,
gains and losses that under generally accepted accounting principles are
included in comprehensive income but are excluded from net income (loss) as
these amounts are recorded directly as an adjustment to stockholders’
equity.  Comprehensive income (loss) was equivalent to net income
(loss) for all periods presented.





Referee
fees – The Company’s principal obligation under the franchise agreements
is to provide referees for the league.





3.           Due From Related
Parties





Due from
related parties consist of:


November 30,
                  
                  
                  February 28,2010
                  
                  
                  2010(Unaudited)USBL
      receivable from Meisenheimer Capital, Inc. (“MCI”), controlling
      stockholder of USBL, non-interest bearing, due on demand
                  
                  $
                  10,500
                  
                  
                  $
                  111,814USBL
      receivable from Synercom (“Synercom”), a corporation controlled by the two
      officers of USBL, non-interest bearing, due on demand
                  
                  
                  -
                  
                  
                  
                  2,000Total
                  
                  $
                  10,500
                  
                  
                  $
                  113,814





Effective
May 31, 2010, the president of USBL was transferred the then $118,783 balance
due from related parties in satisfaction of $118,783 loans payable due to him
from the Company.





4.           Property,
Net





Property,
net consists of:


November 30,
                      
                      
                      February 28,2010
                      
                      
                      2010(Unaudited)Land
                      
                      $
                      121,253
                      
                      
                      $
                      121,253Building
                      
                      
                      155,747
                      
                      
                      
                      155,747Total
                      
                      
                      277,000
                      
                      
                      
                      277,000Accumulated
      depreciation
                      
                      
                      (38,892
                      )
                      
                      
                      (34,998
                      )Property,
      net
                      
                      $
                      238,108
                      
                      
                      $
                      242,002





Since
June 2008, MCREH has had no tenants at the property.


9





5.           Credit Card
Obligations





USBL uses
credit cards of related parties to pay for certain travel and promotion
expenses.  USBL has agreed to pay the credit card balances, including
related interest.  The credit card obligations bear interest at rates
ranging up to 30% and are due in monthly installments of principal and
interest.





6.
            Due to Related
      Parties





Due to
related parties consist of:





November 30,
                      2010
                    
                    
                    February 28,
                      2010(Unaudited)USBL
      loans payable to Spectrum Associates, Inc. (“Spectrum”), a corporation
      controlled by the two officers of USBL, interest at 6%, due on
      demand
                    
                    $
                    1,106,957
                    
                    
                    $
                    911,957USBL
      loans payable to the two officers of USBL, interest at 6%, due on
      demand
                    
                    
                    387,700
                    
                    
                    
                    465,783USBL
      loan payable to Genvest, LLC (“Genvest”), an organization controlled by
      the two officers of USBL, non-interest bearing, due on
    demand
                    
                    
                    20,000
                    
                    
                    
                    20,000USBL
      loans to Daniel T. Meisenheimer, Jr. Trust, a trust controlled by the two
      officers of USBL, non-interest bearing, due on demand
                    
                    
                    44,100
                    
                    
                    
                    44,100MCREH
      note payable to the two officers of USBL, interest at 6%, due December 31,
      2011
                    
                    
                    50,000
                    
                    
                    
                    50,000MCREH
      note payable to Spectrum, interest at 7%, due on demand, secured by MCREH
      property
                    
                    
                    25,000
                    
                    
                    
                    25,000MCREH
      note payable to president of USBL, interest at 7%, due on demand, secured
      by MCREH property
                    
                    
                    45,000
                    
                    
                    
                    45,000MCREH
      note payable to the two officers of USBL, interest at 7%, due on demand,
      secured by MCREH property
                    
                    
                    70,000
                    
                    
                    
                    70,000MCREH
      note payable to the two officers of USBL, interest at 4%, due October 22,
      2009, secured by MCREH property
                    
                    
                    70,000
                    
                    
                    
                    70,000MCREH
      loan payable to Spectrum, non-interest bearing, due on
    demand
                    
                    
                    4,500
                    
                    
                    
                    -MCREH
      loan payable to president of USBL, non-interest bearing, due on
      demand
                    
                    
                    4,000
                    
                    
                    
                    4,000Total
                    
                    
                    1,827,257
                    
                    
                    
                    1,705,840Less
      current portion
                    
                    
                    (1,777,257
                    )
                    
                    
                    (1,655,840
                    )Non
      current portion
                    
                    $
                    50,000
                    
                    
                    $
                    50,000





For the
nine months ended November 30, 2010 and 2009, interest due under the USBL loans
were waived byy the respective lenders.





At
November 30, 2010 and February 28, 2010, accounts payable and accrued expenses
included accrued interest payable on MCREH notes payable to related parties
totaling $47,687 and $35,987, respectively.


10





7.
            Stockholders’
      Equity





Each
share of common stock has one vote.  Each share of preferred stock has
five votes, is entitled to a 2% non-cumulative annual dividend, and is
convertible at any time into one share of common stock.





On May 6,
2010, the Company issued 30,000 restricted shares of Company common stock
(valued at $12,000) to a consultant for services rendered.





8.
            Related Party
      Transactions





In the
three months ended November 30, 2010 and 2009 and the nine months ended November
30, 2010 and 2009, USBL included in other operating expenses, rent payable to
Genvest, LLC of $3,000, $3,000, $9,000 and $9,000,
respectively.





9.
            Commitments and
      Contingencies





Occupancy
Agreement





In
September 2007, the Company moved its office from the MCREH building to a
building owned by Genvest, LLC, an organization controlled by the two officers
of USBL.  Improvements to the Company’s space were completed in
February 2008.  Pursuant to a verbal agreement, the Company is to pay
Genvest monthly rentals of $1,000 commencing March 2008.  At November
30, 2010 and February 28, 2010 accounts payable and accrued expenses included
accrued rent payable to Genvest totaling $33,000 and $24,000,
respectively.





Cancellation of 2008, 2009,
and 2010 Seasons





USBL
cancelled its 2008, 2009, and 2010 seasons.  These cancellations may
result in claims and legal actions from franchisees.





Litigation





On June
30, 2008, a legal action was commenced by Albany Patroons, Inc., a franchisee of
USBL, against the Company in the United States District Court for the Northern
District of New York.  The complaint alleges breach of contract by
USBL due to the suspension of the 2008 season and seeks total damages of
$285,000.  On September 5, 2008, the Company answered the complaint
and asserted a counter-claim against plaintiff for breach of franchise agreement
and/or memorandum of agreement.  This action was discontinued and the
parties agreed to proceed with binding arbitration.  The Company
believes that it has a meritorious defense to the action and does not expect the
ultimate resolution of this matter to have a material adverse effect on its
consolidated financial condition or results of operations.





South Korea
Venture





In August
2008, the Company received $170,667 from a third party to investigate business
opportunities with the South Korea Basketball League and prospective South
Korean sponsors.  Pursuant to the related verbal agreement, USBL paid
a total of $160,000 to a consulting firm approved by the third party and
recognized the remaining $10,667 as consulting fees revenue in the three months
ended February 28, 2009.


11





In
January 2009, the Company received an additional $256,000 from the third
party.  Under the related verbal agreement, USBL paid a total of
$240,000 ($220,000 in fiscal 2010, $20,000 in fiscal 2011) to the consulting
firm approved by the third party and recognized the remaining $16,000 as
consulting fees revenue in the year ended February 28, 2010.





In April
and May 2010, the Company received an additional $157,667 relating to the South
Korea venture.  In the six months ended August 31, 2010, USBL paid a
total of $137,667 to the consulting firm approved by the third party and
recognized the remaining $20,000 as consulting fees revenue in the three months
ended August, 31, 2010.





ITEM2.
            MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATION.





OVERVIEW





It is anticipated that the Company will
continue to rely on financial assistance from affiliates.  The
Meisenheimer family is fully committed to making the Company a profitable
operation and also making the United States Basketball League a viable
one.  Given the current lack of capital, the Company has not been able
to develop any new programs to revitalize the League, nor has it been able to
hire additional sales and promotional personnel.  As a result, the
Company is currently dependent on the efforts of Daniel T. Meisenheimer, III and
two other employees for all marketing efforts.  Their efforts have not
resulted in any substantial increase in the number of franchises.  The
NBA has established a developmental basketball league known as the National
Basketball Developmental League (“NBDL”).  The Company believes that
the establishment of this league, consisting of eight teams, will have no effect
on the Company’s season, since the NBDL season as presently constituted runs
from November through March.  Further, nothing prohibits a NBDL player
from playing in the USBL.  Accordingly, as of the present time, the
Company does not perceive the NBDL as a competitor.  However, with the
establishment of the NBDL, it is unlikely that, at least for the present time,
the Company can develop any meaningful relationship with the
NBA.





THREE
MONTHS ENDED NOVEMBER 30, 2010 AS COMPARED TO NOVEMBER 30, 2009





Revenues decreased $4,000 from $4,000
in 2009 to $0 in 2010. This decrease was due to no consulting fees revenues
earned in 2010 in connection with the South Korea venture (the venture was
discontinued in August 2010).





Operating expenses increased $22,930
from $32,970 in 2009 to $55,900 in 2010 primarily due to an increase in other
expenses.





Net loss decreased $29,219 from $29,569
in 2009 to $350 in 2010, primarily due to a $55,987 improvement in investment
performance in 2010.





NINE
MONTHS ENDED NOVEMBER 30, 2010 AS COMPARED TO NOVEMBER 30, 2009





Revenues increased to $20,000 for the
first nine months of 2010 from $12,000 for the first nine months of
2009.  This increase was due to higher fees recognized from the South
Korea venture in 2010.


12





Operating
expenses increased $33,329 from $139,265 for the nine months ended November 30,
2009 to $172,594 for the nine months ended November 30, 2010, primarily as a
result of the $12,000 stock-based compensation issued to a consultant in 2010
and higher other expenses.





Net loss
increased $11,922 from $120,830 in 2009 to $132,752 in 2010.  The
increase was due mainly to the $33,329 increase in operating expenses, offset
partially by the $12,393 improvement in investment performance and the $8,000
increase in operating revenues.





LIQUIDITY
AND CAPITAL RESOURCES





The Company had cash of $1,873 and a
working capital deficit of $1,743,647 at November 30, 2010.  The
Company's statement of cash flows reflects cash used in operations of $223,519
in 2010, which results primarily from the $132,752 net loss and the $111,178
increase in marketable equity securities. Net cash provided by financing
activities was $224,731 in 2010, primarily due to loans from related
parties.





The Company’s ability to generate cash
flow from franchise royalty fees is dependent on scheduling of a season and the
financial stability of the individual franchises constituting the
League.  Each franchise is confronted with meeting its own fixed costs
and expenses, which are primarily paid from revenues generated from
attendance.  Experience has shown that USBL is generally the last
creditor to be paid by the franchise.  If attendance has been poor,
USBL has from time to time only received partial payment and, in some cases, no
payments at all.  The Company estimates that it requires approximately
$250,000 of working capital to sustain operations over a 12-month
period.  Accordingly, if the Company is unable to generate additional
sales of franchises and schedule a season within the next 12 months, it will
again have to rely on affiliates for loans and revenues to assist it in meeting
its current obligations.  With respect to long term needs, the Company
recognizes that in order for the League and USBL to be successful, USBL has to
develop a meaningful sales and promotional program.  This will require
an investment of additional capital.  Given the Company’s current
financial condition, the ability of the Company to raise additional capital
other than from affiliates is questionable.  At the current time the
Company has no definitive plan as to how to raise additional
capital.





ITEM
      3.
              QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.





Not
applicable





ITEM
      4.
              CONTROLS
      AND PROCEDURES.





Under the
supervision and with the participation of our management, including our
principal executive and financial officers, we have evaluated the effectiveness
of the design and operation of our disclosure controls and procedures as of
November 30, 2010 and, based on such evaluation, our principal executive and
financial officers have concluded that these controls and procedures are
effective.  There were no significant changes in our internal control
over financial reporting that occurred during the quarter ended November 30,
2010 that has materially affected, or is reasonably likely to materially affect,
our internal control over financial reporting.





Disclosure controls and procedures are
our controls and other procedures that are designed to ensure that information
required to be disclosed by us in the reports that we file or submit under the
Exchange Act is recorded, processed, summarized and reported, within the time
periods specified in the Securities and Exchange Commission’s rules and
forms.  Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information required
to be disclosed by us in the reports that we file under the Exchange Act is
accumulated and communicated to our management, including our principal
executive and financial officers, as appropriate to allow timely decisions
regarding required disclosures.


13





PART
II


OTHER
INFORMATION





ITEM
      1.
            LEGAL
      PROCEEDINGS.





On June 30, 2008, a legal action was
commenced by Albany Patroons, Inc., a franchisee of USBL, against the Company in
the United States District Court for the Northern District of New
York.  The complaint alleges breach of contract by USBL due to the
suspension of the 2008 season and seeks total damages of $285,000.  On
September 5, 2008, the Company answered the complaint and asserted a
counter-claim against plaintiff for breach of franchise agreement and/or
memorandum of agreement.  This action was discontinued and the parties
agreed to proceed with binding arbitration.  The Company believes that
it has a meritorious defense to the action and does not expect the ultimate
resolution of this matter to have a material adverse effect on its consolidated
financial condition or results of operations.





ITEM
      6.
            EXHIBITS.





Exhibit No.:
            
            Description:31.1
            
            Certification
      of President (principal executive officer)31.2
            
            Certification
      of  Chief Financial Officer (principal financial
      officer)32
            
            Certification
      pursuant to 18 U.S.C. Section 1350 adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002


14


SIGNATURES


Pursuant
to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized on the 13th day of
January, 2011.





UNITED
      STATES BASKETBALL LEAGUE,INC.By:
              /s/ Daniel T. Meisenheimer
    IIIDaniel
      T. Meisenheimer IIIChairman
      and PresidentBy:
              /s/ Richard C.
  MeisenheimerRichard
      C. MeisenheimerChief
      Financial Officer andDirector





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





Name
            
            Capacity
            
            Date/s/ Daniel T. Meisenheimer IIIDaniel T. Meisenheimer III
            
            Director and President
            
            January 13, 2011(principal executive officer)/s/ Richard C. MeisenheimerRichard C. Meisenheimer
            
            Director and Chief Financial
            
            January 13, 2011Officer  (principal financial andaccounting officer)


15





EXHIBIT INDEX





Exhibit No.:
            
            Description:31.1
            
            Certification
      of President (principal executive officer)31.2
            
            Certification
      of Chief Financial Officer (principal financial
officer)32
            
            Certification
      pursuant to 18 U.S.C. Section 1350 adopted pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002


16