SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   Form 10-KSB/A
                                  Amendment No. 1
    
   

                 ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE 
                          SECURITIES EXCHANGE ACT OF 1934 
             
                   For the fiscal year ended December 31, 1996

                         Commission file number 0-26344

                           GOLF-TECHNOLOGY HOLDING, INC.                   
                 (Name of Small Business Issuer in its charter)

                 Idaho                               59-3303066     
   (State or other jurisdiction of       (I.R.S. Employer Identification No.)
   incorporation or organization)

      13000 Sawgrass Village Circle, Suite 30, Ponte Vedra Beach, FL 32082  
               (Address of principal executive offices)(Zip Code)

                    Issuer's telephone number:  904/273-8772

    Securities registered under Section 12(b) of the Securities Exchange Act:

       Title of each class                  Name of each exchange
                                             on which registered

          None                                     None

    Securities registered under Section 12(g) of the Securities Exchange Act:

                          Common Stock $0.001 par value
                                (Title of Class)

   Check whether the issuer (1) filed all reports required to be filed by
   Section 13 or 15(d) of the Exchange Act during the past 12 months (or for

   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         

   Check if there is no disclosure of delinquent filers in response 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.  [  ]

     State issuer's revenues for its most recent fiscal year: $3,544,183

     State the aggregate market value of the voting stock held by non-
   affiliates of the registrant on March, 31, 1997 computed by reference to
   the price at which the stock was sold on that date:$10,058,030 (based on
   shares traded on the NASDAQ Small Cap Exchange on said date)

   (APPLICABLE ONLY TO CORPORATE REGISTRANTS)
   State the number of shares of each of the issuer's classes of common
   equity, as of March 31, 1997: 4,722,080 shares of common stock.


   <PAGE>
                    GOLF-TECHNOLOGY HOLDING, INC.

                    Index to Financial Statements


   Independent Auditors' Report                                       F-2

   Balance Sheets as of December 31, 1996 and 1995                    F-3

   Statements of Operations for the years ended December 31, 1996 
        and 1995                                                      F-4

   Statements of Stockholders' Equity for the years ended 
        December 31, 1996 and 1995                                    F-5

   Statements of Cash Flows for the years ended 

        December 31, 1996 and 1995                                    F-6

   Notes to Financial Statements                                      F-7

   <PAGE>
                          Independent Auditors' Report



   The Board of Directors
   Golf-Technology Holding, Inc.

   We have audited the accompanying balance sheets of Golf-Technology
   Holding, Inc. as of December 31, 1996 and 1995, and the related statements
   of operations, stockholders' equity (deficit), and cash flows for the
   years then ended.  These financial statements are the responsibility of
   the Company's management.  Our responsibility is to express an opinion on
   these financial statements based on our audits. 

   We conducted our audits in accordance with generally accepted auditing
   standards.  Those standards require that we plan and perform the audit to
   obtain reasonable assurance about whether the financial statements are
   free of material misstatement.  An audit includes examining, on a test
   basis, evidence supporting the amounts and disclosures in the 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 audits
   provide a reasonable basis for our opinion.

   In our opinion, the financial statements referred to above present fairly,
   in all material respects, the financial position of Golf-Technology
   Holding, Inc. as of December 31, 1996 and 1995, and the results of its
   operations and its cash flows for the years then ended in conformity with
   generally accepted accounting principles. 

   The accompanying financial statements have been prepared assuming that the
   Company will continue as a going concern.  As discussed in note 1(b) to
   the financial statements, the Company has suffered recurring losses from
   operations which raise substantial doubt about its ability to continue as
   a going concern.  Management's plans in regard to these matters are also
   described in note 1(b).  The financial statements do not include any
   adjustments that might result from the outcome of this uncertainty.



                              KPMG Peat Marwick LLP


                                              
   Jacksonville, Florida
   March 25, 1997

   <PAGE>
                          GOLF-TECHNOLOGY HOLDING, INC.

                                 Balance Sheets

                           December 31, 1996 and 1995




                 Assets                           1996           1995
   Current assets:
      Cash                                   $    60,106         25,910
      Accounts receivable NET OF
        ALLOWANCE OF $232,652 IN
        1996 AND $34,552 IN 1995                 527,149        128,339
      Inventories (note 2)                     1,061,815        163,619
      Prepaid Inventory                          171,764         36,642
      Equipment for sale (note 3)                275,000              -
      Prepaid Expenses                           128,888         43,750
      Other                                       62,735         37,803
                                              ----------      ---------

           Total current assets                2,287,457        436,063
                                              ----------      ---------

   Property and equipment,net (note 3)           237,166        338,960

   Notes receivable from related parties, 
      net (note 8)                                70,737         26,870
   Certificates of deposits, restricted          122,771         47,383
   Deposits                                      141,302        168,971
   Other                                          21,678         30,123
                                              ----------      ---------
           Total assets                      $ 2,881,111      1,048,370
                                               =========      =========

                    
       Liabilities and Stockholders' 
         Equity (Deficit)
   Current liabilities:
      Notes payable (note 4)                           -        205,000
      Notes payable to related 
        parties (note 4)                         737,500        245,000
      Accounts payable                         1,892,433      1,032,927
      Accrued liabilities                        122,721         44,302
                                               ---------      ---------

        Total current liabilities              2,752,654      1,527,229
                                               ---------      ---------

   Stockholders' equity (deficit) 
      (notes 4, 7, 8, 9 and 12):
      Preferred stock, Series A 9% 
        Cumulative Convertible, 
        $.001 par value per share; 
        aggregate involuntary liquidation 
        preference of $2,233,238 ($5.73 
        share), 5,000,000 shares authorized          390            373
      Preferred stock, Series B Convertible, 
        $.001 par value per share; aggregate 
        involuntary liquidation preference of 
        $9,231,000 ($1,000.00 share), 9,231 
        shares authorized                              9              -
      Common stock, $.001 par value, 
        25,000,000 shares authorized               4,350          3,758
      Additional paid-in capital               9,853,375      3,662,566
      Accumulated deficit                      
                                              (9,729,667)    (4,145,556)
                                               ---------      ---------
           Total stockholders' 
             equity (deficit)                    128,457       (478,859)
                                               ---------      ---------

   Commitments and contingent liabilities 
      (notes 6, 9 and 13)

           Total liabilities and stock-
             holders' equity (deficit)       $ 2,881,111      1,048,370
                                               =========      =========



   See accompanying notes to financial statements.

   <PAGE>
                       GOLF-TECHNOLOGY HOLDING, INC.

                         Statements of Operations

                     Years ended December 31, 1996 and 1995


   
    
   
                                                  1996          1995

   Net sales                                 $ 3,544,183     1,269,843
   Cost of sales                               1,745,007       596,921
                                               ---------     ---------

        Gross profit                           1,799,176       672,922

   Selling and marketing expenses              4,015,190     2,112,963
   General and administrative expenses         2,511,347     1,202,178

   Research and development costs                517,322       619,547
   Other (note 3)                                441,048             -
                                               ---------     ---------

        Operating loss                        
                                              (5,685,731)   (3,261,766)

   Other income (expense):
      Interest income                             32,891         9,918
      Interest expense                           (43,191)       (5,866)
      Write-off of note receivable (note 8)            -      (378,034)
      Royalty income                              53,033        17,670
      Other, net                                  58,887        (1,015)
                                               ---------     ---------

        Net loss before income taxes          
                                              (5,584,111)   (3,619,093)

   Income taxes (note 5)                               -             -
                                               ---------     ---------

        Net loss                              (5,584,111)   (3,619,093)

   Preferred stock cumulative 
      dividends (note 12)                       (175,093)      (62,745)

   Deemed dividend on preferred stock
      (note 12)                               (3,081,000)           -
                                               ---------     =========
   Net loss for common stockholders          $(8,870,204)   (3,681,838)
                                               =========     ========= 

   Net loss per average outstanding 
      common share                           $     (2.17)         (.98)
                                               =========     ========= 

   Average outstanding common shares           4,093,280     3,743,450
    
   
                                               =========     ========= 

   See accompanying notes to financial statements.

   <PAGE>
                          GOLF-TECHNOLOGY HOLDING, INC.

                  Statements of Stockholders' Equity (Deficit)

                     Years ended December 31, 1996 and 1995

   
    
   
   <TABLE>
   <CAPTION>
                                                  
                                                                         Additional      Accu-
                             Preferred Stock         Common Stock         paid-in       mulated
                            Shares     Amount     Shares      Amount      capital       deficit           Total

   <S>                     <C>       <C>       <S>          <C>          <S>     
   Balance, 
     December 31, 1994            -   $    -    3,718,408    $ 3,718     1,905,603       (526,463)      1,382,858

   Issuance of stock              -        -       40,000         40       193,710              -         193,750

   Issuance of stock, 
     net of issuance 
     cost of $307,249       372,600      373            -          -      1,555,378              -       1,555,751

   Other                          -        -            -          -         7,875               -           7,875

   Net loss                       -        -            -          -             -     (3,619,093)     (3,619,093)
                            -------    -----    ---------     ------     ---------      ---------       ---------

   Balance, 
     December 31, 1995      372,600      373    3,758,408      3,758     3,662,566     (4,145,556)       (478,859)

   Issuance of stock, 
     net of issuance 
     cost of $22,400         17,000       17            -          -       109,983              -         110,000

   Issuance of stock              -        -      591,668        592     1,122,007              -       1,122,599

   Issuance of stock, 
     net of issuance cost 
     of $1,191,172
     (note 12)                9,231        9            -          -     8,039,819              -       8,039,828

   Deemed dividend on
     preferred stock
     (note 12)                    -        -            -          -    (3,081,000)             -      (3,081,000)

   Net loss                       -        -            -          -             -     (5,584,111)     (5,584,111)
                             ------      ---    ---------     ------     ---------      ---------       ---------

   Balance, 
     December 31, 1996      398,831    $ 399    4,350,076    $ 4,350     9,853,375     (9,729,667)        128,457
                            =======      ===    =========     ======     =========      =========       =========

   </TABLE>
    
   


   See accompanying notes to financial statements.

   <PAGE>
                          GOLF-TECHNOLOGY HOLDING, INC.

                            Statements of Cash Flows

                     Years ended December 31, 1996 and 1995


                                                  1996           1995

   Cash flows from operating activities:
      Net loss                                 $ (5,584,111)   (3,619,093)
      Adjustments to reconcile net loss 
         to net cash used in 
         operating activities:
        Depreciation and amortization               156,113        64,353

        Write-off of note receivable                      -       378,034
        Write-off of non-recoverable equipment 
           and lease accrual                        441,048             -
        Stock compensation                                -        75,000
        Changes in operating assets 
          and liabilities:
           Accounts receivables                    (398,810)      (69,015)
           Inventories                             (898,196)      (66,913)
           Prepaid Inventory                       (135,122)            -
           Prepaid and other assets                (110,070)      (95,117)
           Deposits and other assets                 28,169      (124,971)
           Accounts payable and accrued 
             liabilities                            895,925       968,764
                                                  ---------    ----------

             Net cash used in operating 
               activities                        (5,605,054)   (2,488,958)
                                                  ---------     --------- 

   Cash flows from investing activities:
      Investment in certificates of deposit, 
        restricted                                  (75,388)      (57,383)
      Maturities of certificates of deposit, 
        restricted                                        -        55,000
      Notes receivable due from related parties     (43,867)     (120,884)
      Capital expenditures                         (720,422)     (290,633)
                                                  ---------     --------- 

        Net cash used in investing activities      (839,677)     (413,900)
                                                  ---------     --------- 

   Cash flows from financing activities:
      Proceeds from notes payable                 1,225,000       450,000
      Repayment of notes payable                   (702,500)            -
      Net proceeds from issuance of preferred
        and common stock                          5,956,427     1,820,014
                                                  ---------     ---------

        Net cash provided by financing 

          activities                              6,478,927     2,270,014
                                                  ---------     ---------

        Net change in cash                           34,196      (632,844)

   Cash balance, beginning of period                 25,910       658,754
                                                  ---------     ---------

   Cash balance, end of period                  $    60,106        25,910
                                                  =========     =========

   Supplemental Disclosures:
     Cash paid for interest                     $    26,900             -
                                                  =========     =========

   Notes payable converted to common stock      $   235,000             -
                                                  =========     =========


   See accompanying notes to financial statements.

   <PAGE>
                          GOLF-TECHNOLOGY HOLDING, INC.

                          Notes to Financial Statements

                           December 31, 1996 and 1995




   (1)     Summary of Significant Accounting Policies and Other Information

           (a)     Nature and Development of Business

                   Golf-Technology Holding, Inc. (the Company), designs,
                   manufactures, and markets Snake Eyes /R/ golf clubs. 
                   Snake Eyes /R/ are tour-quality golf clubs marketed to the
                   premium-priced segment of the golf equipment market.  
                  
                   The predecessor to the Company's operating subsidiary
                   Golf-Tec Holding, Inc. (Golf-Tec) was formed as a Florida
                   corporation in June 1993 under the name Golf-Tec, Inc. to
                   manufacture and market a line of golf clubs to be
                   developed by its sole stockholder and director.  Golf-Tec
                   was formed as a Florida corporation in May 1994 to become
                   the parent company of Golf-Tec Inc., which was merged into
                   Golf-Tec in October 1994.  

                   During the first quarter of 1995, Golf-Tec was acquired by
                   THO2 and Rare Metals Exploration, Inc., an Idaho
                   corporation incorporated in June 1963 (THO2), pursuant to
                   a voluntary share exchange effected between Golf-Tec's
                   stockholders and THO2 on a one-for-one share basis.  THO2
                   changed its name to Golf-Technology Holding, Inc. in
                   connection with the share exchange.  Subsequent to the
                   acquisition, the former shareholders of Golf-Tec have the
                   right to an ownership interest in 3,468,337 or 93%, of the
                   Company's outstanding shares of common stock immediately
                   following the exchange.  
                  
                   As of December 31, 1996, 2,343,334 or 68%, of Golf-Tec's
                   outstanding shares of common stock have been exchanged for
                   shares of the Company's outstanding common stock. 
                   Management anticipates that the remaining 1,125,003, or
                   32%, of Golf-Tec's outstanding shares of common stock will
                   be exchanged for shares in the Company. 
                  
                   For accounting purposes the acquisition has been treated
                   as a recapitalization of Golf-Tec with Golf-Tec as the
                   acquirer.  THO2 had zero net tangible assets (no assets or
                   liabilities) at the date of acquisition.  The historical
                   financial statements prior to 1995 are those of Golf-Tec,
                   except the number of shares outstanding have been
                   retroactively restated to reflect the shares outstanding
                   after the recapitalization.  

           (b)     Liquidity and Capital Resources

                   The Company has financed its operations and investment in
                   assets principally through the sale of equity securities. 
                   The Company has incurred operating losses since its
                   inception.

                   Recurring losses and the negative working capital at
                   December 31, 1996 cause concerns about the Company's
                   liquidity and its ability to continue operations at
                   current levels and expand its product lines.  Subsequent
                   to December 31, 1996, the Company has successfully issued
                   a private Series C 3.33% Convertible Preferred Stock
                   offering which netted proceeds of $2,900,000 to the
                   Company.  Management projects that the Company will be
                   profitable and will have positive cash flow from
                   operations in 1997 based on current sales orders and
                   expense levels. However, it is not certain that the
                   Company will be able to realize management's sales
                   projections.

                   Based on communications with current and prospective
                   investors, the Company believes that it will be able to
                   raise capital, if needed, which together with projected
                   cash flow from operations, will be sufficient to meet the
                   Company's working capital needs for at least the next two
                   years. However, the Company's ability to raise further
                   capital is uncertain.

           (c)     Revenue Recognition

                   Sales are recognized at the time goods are shipped, net of
                   allowance for sales returns.  

           (d)     Inventories

                   Inventories are valued at the lower of cost or market. 
                   Cost is determined using the first-in, first-out (FIFO) 
                   method.

           (e)     Property and Equipment

                   Property and equipment is stated at cost.  Depreciation is
                   computed using the straight-line and accelerated methods
                   over estimated useful lives of five to fifteen years. 
                   Repairs and maintenance costs are charged to expense as
                   incurred.

           (f)     Advertising Costs

                   Advertising costs are expensed as incurred.

           (g)     Research and Development

                   Research and development costs are expensed as incurred.

           (h)     Income Taxes

                   The Company uses the asset and liability method of
                   accounting for income taxes.  Deferred tax assets are
                   recognized for the future tax consequences attributable to
                   differences between the financial statement carrying
                   amounts of existing assets and liabilities and their
                   respective tax bases and operating loss and tax credit
                   carryforwards.  Deferred tax assets and liabilities are
                   measured using enacted tax rates expected to apply to
                   taxable income in the years in which those temporary
                   differences are expected to be recovered or settled.  The
                   effect on deferred tax assets and liabilities of a change
                   in tax rates is recognized in income in the period that
                   includes the enactment date.

           (i)     Stock Option Plan

                   Prior to January 1, 1996, the Company accounted for its
                   stock option plan in accordance with the provisions of
                   Accounting Principles Board ("APB") Opinion No. 25,
                   ACCOUNTING FOR STOCK ISSUED TO EMPLOYEES, and related
                   interpretations.  As such, compensation expense would be
                   recorded on the date of grant only if the current market
                   price of the underlying stock exceeded the exercise price. 

                   On January 1, 1996, the Company adopted SFAS No. 123,
                   ACCOUNTING FOR STOCK-BASED COMPENSATION, which permits
                   entities to recognize as expense over the vesting period
                   the fair value of all stock-based awards on the date of
                   grant.  Alternatively, SFAS No. 123 also allows entities
                   to continue to apply the provisions of APB Opinion No. 25
                   and provide pro forma net income and pro forma earnings
                   per share disclosures for employee stock options grants
                   made in 1995 and future years as if the fair-value-based
                   method defined in SFAS No. 123 had been applied.  The
                   Company has elected to continue to apply the provisions of
                   APB Opinion No. 25 and provide the pro forma disclosure
                   provisions of SFAS No. 123.

           (j)     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.

           (k)     Impairment of Long -Lived Assets and Long-Lived Assets to
                   Be Disposed Of

                   The Company adopted the provisions of SFAS No 121,
                   ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS AND FOR
                   LONG-LIVED ASSETS TO BE DISPOSED OF, on January 1, 1996. 
                   This Statement requires that long-lived assets and certain
                   identifiable intangibles be reviewed for impairment
                   whenever events or changes in circumstances indicate that
                   the carrying amount of an asset may not be recoverable. 
                   Recoverability of assets to be held and used is measured
                   by a comparison of the carrying amount of an asset of
                   future net cash flows expected to be generated by the
                   asset.  If such assets are considered impaired, the
                   impairment to be recognized is measured by the amounts by
                   which the carrying amount of the assets exceed the fair
                   value of the assets.  Assets to be disposed of are
                   reported at the lower of the carrying amount or fair value
                   less costs to sell.  Adoption of this Statement did not
                   have a material impact on the Company's financial
                   position, results of operations, or liquidity.

           (l)     Earnings (Loss) Per Common Share

                   Earnings (loss) per share are calculated by dividing the
                   net income (loss) for common stockholders by the weighted
                   average number of common shares outstanding.  The stock
                   options, warrants and the convertible preferred stock were
                   not considered in the calculation since their inclusion
                   would be anti-dilutive.

           (m)     Significant Customers

                   Approximately 12% and 10% of the Company's 1996 sales were 
                   from two customers.

           (n)     Reclassification

                   Certain 1995 amounts have been reclassified to conform to
                   the presentation adopted in 1996.

   (2)     Inventories

           Inventories consist of the following at December 31, 1996 and
           1995:

                                                   1996          1995

                Components                  $      599,424      96,414
                Finished Goods                     462,391      67,205
                                               -----------     -------

                                            $    1,061,815     163,619

                                               ===========     =======

   (3)     Property and Equipment

           Property and Equipment, at cost, consist of the following at
           December 31, 1996 and 1995:


                                                   1996        1995

                Furniture and fixtures      $       56,390      42,687
                Machinery and equipment            309,489     321,049
                Leasehold improvements              11,885      45,814
                                               -----------     -------
                                                   377,764     409,550
                Less accumulated 
                 depreciation                      140,598      70,590
                                               -----------     -------

                                            $      237,166     338,960
                                               ===========     =======
                                           
           On December 1, 1996, the Company transferred the operations of a
           subsidiary manufacturing plant in Ann Arbor, Michigan, to its
           manufacturing plant at its headquarters in Ponte Vedra Beach,
           Florida. The Company has recorded a charge to operations of
           $441,048 for the year ended December 31, 1996, related to the
           write-off of non-recoverable equipment and accrual of lease
           obligation (see note 6).  Estimated recoverable equipment, net, of
           $275,000 has been recorded and is included in current assets as of
           December 31, 1996.

           Subsequent to December 31, 1996, the Company has realized net
           proceeds approximating $275,000 from the sale of the recoverable
           equipment referred to above. 

   (4)     Notes Payable

           Notes payable at December 31, 1995 

           consists of the following:

                   Unsecured promissory note, 12%, 
                   due May 11, 1995                        $  50,000

                   Unsecured demand note, 10%, subject 
                   to 5% late charge                          30,000

                   Unsecured demand notes, due upon 
                   the closing of any stock subscription 
                   offering through November 30, 1996 or
                   demand thereafter, non-interest 
                   bearing, 24% upon default                 125,000
                                                             -------

                                                           $ 205,000
                                                             =======

           During 1996, the $100,000 of unsecured demand notes, non-interest
           bearing, were converted to 66,668 shares of the Company's common
           stock.  All other notes payable were repaid during 1996.

           Notes payable to related parties at December 31, 1996 and 1995
           consists of the following:

                                                         1996          1995

              Unsecured demand note, non-interest 
                bearing                               $  32,500        5,000

              Unsecured demand note, 10%, due upon 
                closing of any stock subscription
                through October 31, 1997 or 
                demand thereafter                       650,000            -

              Unsecured promissory note, non-interest
                bearing, due September 13, 1995               -       30,000

              Secured promissory note, non-interest 
                bearing, due September 13, 1995               -       30,000

              Promissory note, non-interest bearing, 
                18% upon default, due 
                December 29, 1996                       55,000      180,000
                                                        ------       -------

                                                      $ 737,500      245,000
                                                        =======      =======

           Subsequent to December 31, 1996, all outstanding notes payable to
           related parties, except for the non-interest bearing demand note
           ($32,500), have been paid in full.

           During 1996, $135,000 of the promissory note was converted to
           180,000 shares of the Company's common stock. During 1995, in
           exchange for the unsecured promissory note, the Company issued to
           a shareholder 1,000 warrants exercisable for five years at an
           exercise price of $5.00 per share.

   (5)     Income Taxes

           The Company since inception has had operating losses; therefore,
           no income tax expense has been incurred.  At December 31, 1996,
           the Company had a net operating loss carryforward of approximately
           $9,578,000 which is available to offset future taxable income
           through the year 2011.  A valuation allowance equal to the
           deferred tax asset (approximately $3,604,000) related to the net
           operating loss carryforward has been recorded since it is
           considered more likely than not that the deferred tax asset will
           not be realized based upon recent losses.

   (6)     Leases

           The Company leases its corporate headquarters under a
           noncancelable operating lease expiring July 31, 1997.  The lease
           requires the Company to pay all maintenance, insurance, and
           property taxes, and is subject to normal escalation provisions. 
           Rent expense was $39,600 and $38,907 for the years ended December
           31, 1996 and 1995, respectively.  

           During June, 1996, the Company entered a noncancelable operating
           lease for manufacturing space expiring July 31, 1997. Rent expense
           was $23,300 for the year ended December 31, 1996.

           During March, 1995, the Company entered a noncancelable operating
           lease for manufacturing and office space effective May 1, 1995
           expiring April 30, 2000. Rent expense was $83,000 and $54,000 for
           the years ended December 31, 1996 and 1995, respectively.  The
           Company is currently negotiating to either sub-lease or buyout
           this lease.  The Company has accrued $42,000 as of December 31,
           1996 for the estimated future net expenditures required under this
           lease.

           Future minimum lease payments under the leases, are as follows:

                     1997             $ 142,000
                     1998                89,000
                     1999                92,000
                     2000                31,000
                     Thereafter               0
                                       --------

                                      $ 354,000
                                       ========

   (7)     Stock Option Plan

           The Company's Board of Directors have adopted a stock award and
           incentive plan (the Plan) for its officers, directors, selected
           employees and independent contractors of the Company .  The Plan
           reserved 1,250,000 shares of common stock and provided that the
           term of each award be determined by the Board of Directors.

           The options granted may be either nonqualified or incentive stock
           options and the exercise price may not be less than 110% of the
           fair market value of the Company's common stock at the date of
           grant.  The options expire five to ten years from the date of
           grant, unless otherwise provided in the option agreement.  

           The Company applies APB Opinion No. 25 in accounting for its Plan
           and, accordingly, no compensation cost has been recognized for its
           stock options in the financial statements.  Had the Company
           determined compensation cost based  on the fair value at the grant
           date for its stock options issued in 1996 and 1995 under SFAS No.
           123, the impact on the Company's net loss and net loss per share 
           for the years ended December 31, 1996 and 1995 would have been
           immaterial.  This pro forma information applies only to options 
           granted in 1996 and 1995.  Therefore, the full impact of calculat-
           ing compensation cost for stock options under SFAS No. 123 is not
           considered in the pro forma net loss and net loss per share
           amounts referred to because compensation cost is reflected over
           the options' vesting period and compensation cost for options
           granted prior to January 1, 1995 is not considered.

           Stock option activity during the periods indicated is as follows:

                                         Number of       Weighted-Average
                                          Shares         Exercise  Price

                 Balance at 
                   December 31, 1994      755,000          $   1.65
                         Granted           26,500              1.62
                         Exercised              -                 -
                         Forfeited              -                 -
                         Expired                -                 -
                                          -------              ----

                 Balance at 
                   December 31, 1995      781,500              1.63
                         Granted                -                 -
                         Exercised              -                 -
                         Forfeited              -                 -
                         Expired                -                 -
                                          -------              ----

                Balance at

                  December 31, 1996       781,500              1.63
                                          =======              ====

           At December 31, 1996, the range of exercise prices and weighted-
           average remaining contractual life of outstanding options was
           $1.50 - $1.65 and 5.73 years, respectively.

           At December 31, 1996 and 1995, the number of options exercisable
           was 421,500 and 301,500, respectively, and the weighted average 
           exercise price of those options was $1.61 and $1.59, respectively.

   (8)     Related Party Transactions

           (a)     Employment Agreements

                   The Company has employment agreements with the Chairman
                   and Chief Operating and Financial Officer which provide
                   for 1996 salaries of $100,000 and $72,000, respectively.

           (b)     Notes Receivable

                   The Company has made advances to shareholders of the
                   Company.  As of December 31, 1996 and 1995, related
                   outstanding balances were $70,737 and $26,870,
                   respectively. The advances do not bear interest and are
                   due upon demand; however, the Company does not intend to
                   demand repayment of the advances prior to January 1, 1998. 
                   Accordingly, the outstanding balances at December 31, 1996
                   have been classified as long term.  
           
                   Employee advances of $378,034 were written-off during 1995.

           (c)     Private Placement Agent

                   A former director of the Company served as President and a
                   director of Coleman and Company Securities, Inc., a
                   registered broker-dealer (Coleman) hired by the Company to
                   act as its exclusive placement agent for raising capital
                   investment.    Affiliates of Coleman were allowed to
                   purchase 800,000 shares of the Company's common stock at
                   $.01 per share in connection with the formation of the
                   Company.  Coleman holds warrants to purchase 146,834
                   shares of common stock at an exercise price of $1.80 per
                   share.   The warrants are exercisable for five years.

           Coleman had been retained by the Company to provide financial
           consulting services for a three-year term expiring December 15,
           1999, for which it received $3,000 per month.  Subsequent to
           December 31, 1996, the Company has negotiated a settlement and has
           paid $20,000 to sever this agreement, effective immediately.

   (9)     Representation Agreements

           The Company has representation agreements with thirteen PGA, PGA
           Senior and NIKE Tour players.  The Company has agreed to pay
           certain incentives based upon performance under the agreements,
           including minimum annual compensation totaling $561,250, $190,000,
           $75,000 AND $150,000 FOR 1997, 1998, 1999 AND 2000, respectively; 
           five year stock options for 10,000 shares of the Company's 
           preferred capital stock; bonuses of $10,000 to $50,000 per win 
           of an official tour event or "Major" championship; bonus up to 
           $40,000 based on a member's ranking on the PGA Tour Money List 
           for 1997 and 1998, and, bonus up to $100,000 based on a member's 
           PGA Tour earnings for 1997. The Company incurred expenses for 
           representation agreements of $842,900 and $536,250 in 1996 and 
           1995, respectively. 

   (10)    Distribution Agreement

           The Company has a distribution agreement whereby Palawan Pearls,
           Inc. d/b/a SunTrex Corporation (SunTrex) has the exclusive rights
           to sell golf clubs under the Company's trademarks in the Pacific
           Rim countries for a period expiring January 24, 1998. Based on the
           agreement, SunTrex is required to purchase minimum annual
           quantities from the Company at terms and prices specified in the
           agreement.  These terms and prices are subject to negotiation by
           the parties.

   (11)    Licensing Agreement

           The Company has a licensing agreement whereby Michael Thomas, Ltd.
           (Thomas) has the exclusive rights for the design, manufacture, and
           distribution of clothing under the Company's trademarks for a
           period  expiring March 31, 2000, including a three to five year
           renewal option.  Under the agreement, Thomas is required to pay
           licensing fees on total sales on a graduated scale. 

   (12)    Preferred Stock

           In 1995, the Company issued 372,600 shares of its Series A 9%
           Cumulative Convertible Preferred Stock (Preferred Stock) for net
           proceeds of approximately $1,555,751.  THE SERIES A PREFERRED 
           STOCK IS CONVERTIBLE AT ANY TIME AT A CONVERSION PRICE EQUAL TO
           $5.00 PER SHARE OF COMMON STOCK.  Coleman served as placement
           agent for the offering and received selling commissions and an
           expense allowance equal to 10% and 2.5%, respectively, of the
           sales price of the Preferred Stock, plus one warrant for every ten
           shares placed by Coleman in the offering.  The warrants are for
           the purchase of one share of the Preferred Stock or the number of
           shares of the Company's common stock into which such shares of
           Preferred Stock would be convertible, at an exercise price of
           $6.00 per share and are exercisable for four years commencing one
           year following the completion of the offering.  Coleman received
           selling commissions of $236,300 and an expense allowance of
           $46,575 in connection with the offering.  

           The Company has not declared and, therefore, not paid accumulated
           dividends on its  Series A preferred stock.  Dividends on Series A
           preferred stock cannot be declared or paid until the Company has
           accumulated profits.  If the Company had accumulated profits at
           December 31, 1996 and 1995, it would have accumulated dividends
           payable on preferred stock in the amounts of $237,838 and $62,745,
           respectively.  Because the Company has not paid dividends on its
           preferred stock, the preferred stock converted from non-voting to
           voting preferred stock in April 1996.

           On May 20, 1996, the Company issued 9,231 shares of its Series B
           Convertible Preferred stock, $1,000 face value, at a discount of
           $3,081,000 for net proceeds of $5,098,628, including brokers fees
           of $1,051,372.  The holder of each issued and outstanding share of
           Series B Preferred Stock shall be entitled to receive, when and as
           declared by the Board of Directors of the Company, out of the
           assets at the time legally available for such purpose, dividends
           at a rate of $32.50 per share per annum.  No dividends shall be
           declared and paid on the Series B Preferred Stock unless all
           accrued but unpaid dividends on the Company's existing Series A
           Preferred Stock have been declared and paid in cash.  Such
           dividends are not cumulative.  If all shares of Series B Preferred
           Stock have not been converted into common stock by April 30, 1997,
           such dividends shall begin to accumulate on all shares of Series B
           Preferred Stock which remain outstanding at such time.

           Upon liquidation, dissolution or winding up of the Company,
           holders of Series B Preferred stock are entitled to receive
           liquidation distributions equivalent to $1,000 per share before
           any distribution to holders of Common Stock.  The liquidation
           preference of the Series B Preferred Stock shall be junior in
           right of payment to the liquidation preference of the Company's
           existing class of Series A Preferred Stock.  The Series B
           Preferred Stock is convertible at any time commencing forty-five
           days after the last day on which there is an original issuance of
           the Series B Preferred Stock.  The conversion price equals the
           lesser of the average closing bid for the five days prior to
           conversion or $6.05.  Each share of Series B Preferred Stock
           outstanding on December 31, 1997 automatically shall be converted
           into Common Stock on such date at the conversion price then in
           effect.

           
    
   
           As noted above, the Company issued the Series B Preferred Stock
           at a discount of $3,081,000.  Since the preferred stock is 
           convertible at its face amount into Common Stock, the conversion
           results in a beneficial conversion feature to the preferred
           shareholder.  On March 28, 1997, a newly adopted position was
           formally issued by the Securities and Exchange Commission which
           requires companies to report the value of beneficial conversion
           features on preferred stock issued as a dividend to preferred
           shareholders.  Accordingly, such amount has been reported as a
           "deemed dividend on preferred stock" on the Statements of
           Operations and Stockholders' Equity (deficit) for 1996.
    
   

           
    
   
           On January 31, 1997, the Company issued 4,500 shares of its Series
           C 3.33% Convertible Preferred stock, $1,000 face value ($4,500,000)
           and warrants valued at $750,000 to purchase 501,724 shares of Common
           Stock of the Company at prices ranging from $3.00 - $3.65 per share
           and are exercisable starting January 27, 1997 through December 31,
           2002 for proceeds of $2,900,000, including brokers fees of $100,000.
           The stock was issued pro-rata, in two separate parcels of 1,875 and 
           2,625 shares to Common shareholders of the Company.  The holders of 
           the issued stock shall be beneficially entitled similar to that of 
           Series B Preferred shareholders.  Series C dividends are payable 
           annually in arrears, at the option of the Company in cash or 
           additional shares of Series C Stock.  No dividends shall be declared 
           and paid on the Series C Preferred Stock (other than a dividend 
           payable solely in shares of Series C Preferred Stock) unless all 
           accrued but unpaid dividends on the Company's existing Series A 
           Preferred Stock have been declared and paid in cash.  Such dividends 
           are not cumulative.

           If all shares of Series C Preferred Stock have not been converted 
           into common stock by December 31, 1997, such dividends shall begin 
           to accumulate on all shares of Series C Preferred Stock which 
           remain outstanding at such time.  
    
   

           
    
   
           Upon liquidation, dissolution or winding up of the Company,
           holders of Series C Preferred stock are entitled to receive
           liquidation distributions equivalent to $1,000 per share before
           any distribution to holders of Common Stock.  The liquidation
           preference of the Series C Preferred Stock shall be junior in
           right of payment to the liquidation preference of the Company's
           existing class of Series A Preferred Stock and shall be a pari
           passu basis with the right of payment to the liquidation preference
           of the Company's existing class of Series A Preferred Stock and
           shall be a pari passu basis with the right of payment to the 
           liquidation preference of the Company's existing class of Series B
           Preferred Stock.  The Series C Preferred Stock is convertible at any 
           time commencing forty-five days after the last day on which there 
           is an original issuance of the Series C Preferred Stock.  The 
           conversion price equals the lesser of the average closing bid for 
           the five days prior to conversion or $2.25.  Each share of Series 
           C Preferred stock outstanding on June 30, 2002 automatically shall 
           be converted into Common Stock on such date at the conversion 
           price then in effect.
    
   

           
    
   
           Proceeds from this offering have been used to repay the $650,000, 
           10% unsecured demand note payable to related party (see Note 4) as 
           mandated by the Series C subscription.
    
   

   (13)    Commitment and Contingent Liabilities

           THO2 initially was organized as a mining company but is believed
           to have engaged in only sporadic activity and to have been dormant
           for the last several years.  Management's knowledge about THO2's
           prior business is extremely limited.  Management has no way of
           knowing whether there is any basis for a contingent liability
           arising out of acts or omissions of the Company prior to the share
           exchange, such as a tax liability or an environmental claim
           relating to any real property to which the Company may have held
           title many years ago.  While management does not believe that any
           such contingent liabilities exist, there can be no assurance that
           any possible contingent liabilities resulting from the Company's
           prior business history have not yet been cut off by applicable
           statutes of limitations.  Because management knows very little
           about THO2's prior business, it has no basis for determining
           likely sources of contingent liabilities and therefore has no
           basis for determining when applicable statutes of limitation would
           run.

           The Company is involved in litigation on matters and is subject to
           certain claims which arise in the normal course of business, none
           of which, in the opinion of management, is expected to have a
           material adverse effect on the Company's consolidated financial
           position or results of operations.

   <PAGE>


                                   SIGNATURES

     In accordance with 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, thereinto duly authorized.

                                   GOLF-TECHNOLOGY HOLDING, INC.

   
    
   
   Date:   May 14, 1997          By:  /s/ Harold E. Hutchins
                                      Harold E. Hutchins
                                      Chief Operating and Financial Officer