Delaware		5940		16-1634897
(State or other jurisdiction of incorporation or organization)		(Primary standard industrial classification code number)		(I.R.S. Employer Identification No.)

Mark L. Mandel, Esq. White & Case LLP 1155 Avenue of the Americas New York, New York 10036 Tel: (212) 819-8200 Fax: (212) 354-8113		Michael J. Schiavone, Esq. Shearman & Sterling LLP 599 Lexington Avenue New York, New York 10022 Tel: (212) 848-4000 Fax: (212) 848-7179

			Proposed Maximum
Title of Each Class of			Aggregate Offering			Amount of
Securities to be Registered			Price Per Share(1)			Registration Fee
Common stock, par value $0.001 per share			U.S.$115,000,000			U.S.$12,305

(1)	Estimated solely for the purpose of computing the amount of the registration fee pursuant to Rule 457 under the Securities Act of 1933.

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The information contained in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

		Per Share				Total
Public offering price		$				$
Underwriting discount		$				$
Proceeds, before expenses, to Golfsmith International Holdings, Inc.		$				$

Merrill Lynch & Co.	JPMorgan

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Prospectus Summary		1
Risk Factors		8
Special Note Regarding Forward-Looking Statements		19
Use of Proceeds		20
Dividend Policy		20
Capitalization		21
Dilution		22
Selected Consolidated Financial and Other Data		23
Management’s Discussion and Analysis of Financial Condition and Results of Operations		26
Business		41
Management		61
Certain Relationships and Related Party Transactions		73
Principal Stockholders		77
Description of Capital Stock		79
Shares of Common Stock Eligible for Future Sale		82
Certain U.S. Federal Tax Considerations for Non-U.S. Holders of Our Common Stock		84
Underwriting		88
Legal Matters		93
Experts		93
Where You Can Find Additional Information		94
Index to the Consolidated Financial Statements		F-1

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	Our success depends on the popularity of golf.

	A reduction in discretionary consumer spending could reduce sales of golf products.

	Our sales and profits may be adversely affected if we or our suppliers fail to develop and introduce new and innovative products that appeal to our customers.

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	Our success depends on our ability to compete with our existing major competitors and with new competitors that may enter the golf retail market.

	Our growth depends primarily upon our ability to open new stores and operate them profitably, and our failure to do so could have a material adverse effect on our business.

	•	identify suitable store locations that meet our target demographics;
	•	negotiate and enter into long-term leases upon acceptable terms;
	•	build-out or refurbish sites on a timely and cost-effective basis;
	•	hire, train and retain skilled managers and personnel; and
	•	integrate new stores into existing operations.

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	If our key suppliers limit the amount or variety of products they sell to us or if they fail to deliver products to us in a timely manner and upon customary pricing terms, our business could be adversely affected.

	Our sales could decline if we are unable to process increased traffic or prevent security breaches on our Internet site and our network infrastructure.

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	Our ability to expand our business will depend upon the availability of adequate capital.

	We lease almost all of our store locations. If we are unable to maintain those leases or locate alternative sites for our stores on terms that are acceptable us, our net revenues and profitability could be adversely affected.

	Our operating results are subject to seasonal fluctuations which could cause the market price of our common stock to fluctuate.

	Our stores are clustered in particular areas and adverse events in those areas may have a disproportionate effect on our business.

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	Our comparable store sales may fluctuate, which could negatively impact our future operating performance.

	•	customer demand in different geographic regions;
	•	unseasonable weather during certain periods for certain geographic regions;
	•	our ability to efficiently source and distribute products;
	•	changes in our product mix;
	•	our decision to relocate or refurbish certain stores;
	•	promotional events;
	•	effects of competition;
	•	our ability to effectively execute our business strategy; and
	•	general economic conditions.

	If we fail to accurately target the appropriate segment of the consumer catalog market or if we fail to achieve adequate response rates to our catalogs, our results of operations may suffer.

	•	achieve adequate response rates to our mailings;
	•	offer an attractive merchandise mix;
	•	cost-effectively add new customers;
	•	cost-effectively design and produce appealing catalogs; and
	•	timely deliver products ordered through our catalogs to our guests.

	If we lose the services of our Chief Executive Officer, we may not be able to manage our operations and implement our growth strategy effectively.

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	We rely on our management information systems for inventory management, distribution and other functions. If our information systems fail to perform these functions adequately or if we experience an interruption in their operation, our business and results of operations could be adversely affected.

	•	earthquake, fire, flood and other natural disasters;
	•	power loss, computer systems failure, Internet and telecommunications or data network failure; and
	•	hackers, computer viruses, software bugs or glitches.

	Our profitability would be adversely affected if the operation of our Austin, Texas call center or distribution and fulfillment center were interrupted or shut down.

	A disruption in the service or a significant increase in the cost of our primary delivery service for our direct-to-consumer operations would have a material adverse effect on our business.

	An increase in the costs of mailing, paper, and printing our catalogs would adversely affect our profitability.

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	If we are unable to enforce our intellectual property rights our net revenues and profits may decline.

	We may become subject to intellectual property suits that could cause us to incur substantial costs or pay substantial damages or prohibit us from selling our products.

	We may be subject to product warranty claims or product recalls which could harm our business, results of operations, and reputation.

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	Disruption of operations of ports through which our products are imported from Asia could have a material adverse effect on our results of operations.

	Current and future tax regulations may adversely affect our direct-to-consumer business and negatively impact our results of operations.

	We may pursue strategic acquisitions, which could have an adverse impact on our business.

	Atlantic Equity Partners III, L.P. will have significant influence over us, including the ability to designate a majority of our board of directors, whether or not such a decision is believed by other stockholders to be in our best interests.

	•	the composition of our board of directors, which has the authority to direct our business and appoint and remove our officers;
	•	approving or rejecting a merger, consolidation or other business combination; and

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	•	amending our certificate of incorporation which governs the rights attached to our shares of common stock.

	Following this offering, we may be a “controlled company” within the meaning of the Nasdaq corporate governance rules and, as a result, will qualify for, and intend to rely on, exemptions from certain corporate governance requirements.

	Our directors and executive officers who have relationships with First Atlantic Capital may have conflicts of interest with respect to matters involving our company.

	There has been no prior public market for our common stock and our stock price may be volatile after this offering.

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	•	announcements or introductions of technological innovations or new products, or product enhancements or pricing policies by us or our competitors;
	•	disputes or other developments with respect to our or our competitors’ intellectual property rights;
	•	announcements of strategic partnerships, joint ventures or other agreements by us or our competitors;
	•	recruitment or departure of key personnel;
	•	future sales of some or all of the shares of our common stock held by Atlantic Equity Partners;
	•	our sale of common stock or other securities in the future;
	•	changes in the estimation of the future size and growth of our markets; and
	•	competition, market conditions in our industry and the economy as a whole.

	Future sales of our common stock could cause the market price of our common stock to drop significantly, even if our business is profitable.

Number of Shares		Date of Availability for Resale into the Public Market
million		Upon the effectiveness of this prospectus
Approximately            million		180 days after the date of this prospectus, of which approximately       million are subject to volume limitations under Rule 144
Approximately            million		More than 180 days after the date of this prospectus

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	The anti-takeover provisions in our charter documents and under Delaware law could adversely affect your rights as a holder of our common stock.

	If we fail to maintain an effective system of internal controls, we may not be able to accurately or timely report our financial results, which could cause our share price to fall or result in our shares of common stock being delisted.

	We will incur increased costs as a result of being a public company.

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	•	the timing, amount and composition of future capital expenditures;
	•	the timing and number of new store openings and our expectations as to the costs associated with new store openings;
	•	the timing and completion of the remodeling of our existing stores;
	•	our plans to grow particular areas of our business, including sales of our proprietary branded products, our apparel and tennis products; and
	•	our plans to launch new customer care initiatives, including our guest loyalty program.

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	•	to retire $93.75 million aggregate principal amount at maturity of our 8.375% senior secured notes due 2009 issued on October 15, 2002, which had an accreted value of $82.9 million as of February 28, 2006;
	•	to repay indebtedness outstanding under our existing senior secured credit facility, which had an aggregate principal amount of $5.8 million as of February 28, 2006;
	•	to pay a one-time $3.0 million fee to terminate our management consulting agreement with First Atlantic Capital, Ltd. upon completion of this offering. This agreement obligates us to pay approximately $600,000 per year, plus expenses, to First Atlantic Capital, Ltd. until 2012; and
	•	for general corporate purposes.

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	•	on an actual basis;
	•	on a pro forma basis to give effect to:

	•	the issuance of                      shares of common stock to certain members of our management upon the conversion of a corresponding number of outstanding equity units;
	•	an amendment to our certificate of incorporation to authorize the issuance of up to                      shares of common stock and                      shares of preferred stock; and
	•	the issuance and sale of                      shares of common stock in this offering, our receipt of estimated net proceeds of approximately $           million, after deducting the underwriting discount and estimated offering expenses payable by us and assuming an initial public offering price of $          per share of common stock, the midpoint of the range of the estimated initial public offering price set forth on the cover of this prospectus, and the application of such net proceeds, together with borrowings under our new senior secured credit facility, as described under “Use of Proceeds.”

			December 31, 2005
			Actual				Pro Forma
							(unaudited)
			(in thousands)
Cash and cash equivalents			$	4,207			$
Existing senior secured credit facility			$	—			$	—
New senior secured credit facility			$	—			$
8.735% senior secured notes			$	82,450			$	—
Total indebtedness			$	82,450			$
Stockholders’ equity:
	Common stock, $.001 par value per share; 40,000,000 shares authorized and 21,594,597 shares issued and outstanding, actual;           shares authorized and            shares issued and outstanding, pro forma			22
	Preferred stock, $          par value per share; no shares authorized, issued and outstanding, actual;            shares authorized, and no shares issued and outstanding, pro forma			—				—
	Restricted common stock units, $.001 par value per unit; 755,935 units issued and outstanding, actual, and zero units issued and outstanding, pro forma			1				—
	Additional capital			60,289
	Other comprehensive income			136
	Accumulated deficit			(3,320	)
Total stockholders’ equity				57,128
Total capitalization			$	143,785			$

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Assumed initial public offering price per share							$
	Historical net tangible book value per share as of December 31, 2005		$
	Decrease in net tangible book value per share attributable to repayment of debt outstanding at January 1, 2006
	Increase in net tangible book value per share attributable to conversion of equity units outstanding at January 1, 2006
	Increase per share attributable to new investors
Historical net tangible book value per share after this offering
Dilution per share to new investors							$

											Total
			Shares Purchased								Consideration
																			Average Price
			Number				Percent				Amount				Percent				Per Share
Existing stockholders									%		$						%		$
New investors									%		$						%		$
	Total							100	%		$					100	%		$

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		Predecessor								Successor
						Period from				Period from
		Fiscal Year				December 30,				October 16,				Fiscal Year Ended
		Ended				2001 through				2002 through
		December 29,				October 15,				December 28,				January 3,				January 1,				December 31,
		2001				2002				2002				2004				2005				2005
		(in thousands, except share, per share and store data)
Statement of Operations Data:
Net revenues		$	221,439			$	180,315			$	37,831			$	257,745			$	296,202			$	323,794
Cost of products sold			143,118				117,206				25,147				171,083				195,014				208,044
Gross profit			78,321				63,109				12,684				86,662				101,188				115,750
Selling, general and administrative			64,081				48,308				13,581				73,400				90,763				99,310
Store pre-opening/closing expenses			—				122				93				600				743				1,765
Amortization of deferred compensation (1)			458				6,033				—				—				—				—
Total operating expenses			64,539				54,463				13,674				74,000				91,506				101,075
Operating income			13,782				8,646				(990	)			12,662				9,682				14,675
Interest expense			(6,825	)			(5,206	)			(2,210	)			(11,157	)			(11,241	)			(11,744	)
Interest income			597				331				7				40				64				73
Other income, net			1,031				2,365				14				164				1,162				354
Minority interest			(581	)			(844	)			—				—				—				—
Loss on debt extinguishment(2)			—				(8,047	)			—				—				—				—
Income (loss) from continuing operations before income taxes			8,004				(2,755	)			(3,179	)			1,709				(333	)			3,358
Income tax benefit (expense)			(251	)			(709	)			633				(645	)			(4,423	)			(400	)
Income (loss) from continued operations			7,753				(3,464	)			(2,546	)			1,064				(4,756	)			2,958
Income (loss) from discontinued operations			(590	)			(230	)			(40	)			—				—				—
Income (loss) before extraordinary items			7,163				(3,694	)			(2,586	)			1,064				(4,756	)			2,958
Extraordinary items(3)			—				2,022				—				—				—				—
Net income (loss)		$	7,163			$	(1,672	)		$	(2,586	)		$	1,064			$	(4,756	)		$	2,958
Basic income (loss) per share of common stock		$	0.72			$	(0.17	)		$	(0.12	)		$	0.05				(0.21	)		$	0.13
Weighted average number of shares outstanding used in basic income (loss) per share calculation			10,000,000				10,000,000				20,917,199				21,523,956				22,350,532				22,350,532
Diluted income (loss) per share of common stock		$	0.68			$	(0.17	)		$	(0.12	)		$	0.05			$	(0.21	)		$	0.13
Weighted average number of shares outstanding used in diluted income (loss) per share calculation			10,589,442				10,000,000				20,917,199				21,523,956				22,350,532				22,668,785
Other Financial Data:
Gross profit as a percentage of sales			35.4	%			35.0	%			33.5	%			33.6	%			34.2	%			35.7	%
Store Data (not in thousands):
Comparable store sales increase(4)			2.9	%			N/A				0.1	%			7.4	%			0.7	%			2.5	%
Number of stores at period end			24				24				26				38				46				52
Gross square feet at period end			581,890								596,206				759,981				849,677				905,827
Net sales per selling square foot for stores open at beginning and end of period(5)		$	268							$	271			$	302			$	333			$	353

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		Predecessor								Successor
						Period from				Period from
		Fiscal Year				December 30,				October 16,				Fiscal Year Ended
		Ended				2001 through				2001 through
		December 29,				October 15,				December 28,				January 3,				January 1,				December 31,
		2001				2002				2002				2004				2005				2005
		(In thousands)
Balance Sheet Data (at period end):
Cash and cash equivalents		$	33,735			$	3,788			$	6,950			$	1,051			$	8,575			$	4,207
Inventories			33,776				33,152				32,352				51,213				54,198				71,472
Working capital(6)			47,152				18,753				16,946				18,329				20,309				22,800
Total assets			105,686				153,135				155,548				177,449				186,929				204,836
Long-term debt			33,720				75,000				75,380				77,483				79,808				82,450
Total stockholders’ equity			32,519				56,011				53,473				58,976				54,313				57,127

(1)	During fiscal 2000, the predecessor company’s board of directors authorized Golfsmith to reprice stock options granted to employees and officers with exercise prices in excess of the then-current fair market value. Options to purchase a total of 1,716,780 shares of common stock were repriced. Golfsmith recorded deferred compensation of $4.1 million related to the repriced options during the period from December 30, 2001 through October 15, 2002. The deferred charge was being amortized over the average remaining life of the repriced options. For the period from December 30, 2001 through October 15, 2002, Golfsmith amortized $6.0 million (including all remaining amounts as of the merger date) to compensation expense related to these repriced options. There was no remaining deferred compensation relating to these repriced options subsequent to October 15, 2002 as all remaining historical Golfsmith options vested and were either canceled in exchange for the right to receive cash or surrendered in exchange for stock units as part of the merger transaction.
(2)	On October 15, 2002, immediately prior to the merger with Golfsmith Holdings, Golfsmith repaid existing subordinated notes held by a third party lender. During the period from December 30, 2001 through October 15, 2002, Golfsmith recorded a loss on this extinguishment of senior subordinated debt of $8.0 million.
(3)	Immediately prior to the merger in October 2002, Golfsmith repurchased a minority interest held by a third party. Golfsmith repurchased the minority interest which had a carrying value of $13.1 million for cash consideration of $9.0 million resulting in a $2.1 million write down of long term assets associated with the minority interest and negative goodwill of $2.0 million. In accordance with Statement of Financial Accounting Standard (SFAS) No. 141, Business Combinations, the negative goodwill is recorded in the period from December 30, 2001 through October 15, 2002, as an extraordinary item in the consolidated statement of operations. The extraordinary item is recorded without a tax effect due to Golfsmith’s election to be treated as a Subchapter S corporation during the predecessor period.
(4)	We consider sales by a new store to be comparable commencing in the fourteenth month after the store was opened or acquired. We consider sales by a relocated store to be comparable if the relocated store is expected to serve a comparable customer base and there is not more than a 30-day period during which neither the original store nor the relocated store is closed for business. We consider sales by stores with modified layouts to be comparable. We consider sales by stores that are closed to be comparable in the period leading up to closure if they met the qualifications of a comparable store and do not meet the qualifications to be classified as discontinued operations under SFAS No. 144, Accounting for the Impairment of Long-Lived Assets. Comparable store results for a 53-week fiscal year are presented on a 52/52 week basis by omitting the last week of the 53-week period. Comparable store sales are reported for a combined fiscal 2002 — predecessor period from December 30, 2001 through October 15, 2002 plus successor period from October 16, 2002 through December 28, 2002 — compared predecessor fiscal 2001 and are not reported for the interim periods.
(5)	Calculated using net sales of all stores open at both the beginning and the end of the period and the selling square footage for such stores. Selling square feet includes all retail space including but not limited to hitting areas, putting greens and check-out areas. It does not include back-room and receiving space, management offices, employee breakrooms, restrooms, vacant space or area occupied by GolfTEC Learning Centers.
(6)	Defined as total current assets minus total current liabilities.

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	Industry Trends

	Fiscal Year

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	Don Sherwood Acquisition

	Revenues

	Revenue Trends and Drivers

		Fiscal 2003								Fiscal 2004								Fiscal 2005
		$				%				$				%				$				%
		(in thousands)								(in thousands)								(in thousands)
Stores		$	162,073				62.9	%		$	204,498				69.0	%		$	234,261				72.3	%
Direct-to-consumer			89,021				34.5				84,372				28.5				83,040				25.7
International distributors and other (1)			6,651				2.6				7,332				2.5				6,493				2.0

(1)	Consists of (a) sales made through our international distributors and our distribution and fulfillment center near London, (b) revenues from the Harvey Penick Golf Academy, and (c) our initial recognition in fiscal 2005 of gift card breakage, as described below.

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	Revenue Recognition

	Cost of Goods Sold

	Operating Expenses

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	Inventory Valuation

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	Long-lived Assets, Including Goodwill and Identifiable Intangible Assets

	Product Return Reserves

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	Store Closure Costs

	Operating Leases

	Deferred Tax Assets

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		Fiscal 2003				Fiscal 2004				Fiscal 2005
Statement of Operations Data:
Net revenues			100.0	%			100.0	%			100.0	%
Cost of products sold			66.4				65.8				64.3
Gross profit			33.6				34.2				35.7
Selling, general and administrative			28.5				30.6				30.7
Store pre-opening/closing expenses			0.2				0.3				0.5
Total operating expenses			28.7				30.9				31.2
Operating income			4.9				3.3				4.5
Interest expense			(4.3	)			(3.8	)			(3.6	)
Interest income			*				*				*
Other income, net			0.1				0.4				0.1
Income (loss) from continuing operations before income taxes			0.7				n/m				1.0
Income tax benefit (expense)			n/m				n/m				n/m
Net income (loss)			0.4	%			n/m				0.9	%

*	Less than 0.1%.

	Comparison of Fiscal 2005 to Fiscal 2004

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	Comparison of Fiscal 2004 to Fiscal 2003

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		Fiscal 2003																Fiscal 2004																Fiscal 2005
		Q1				Q2				Q3				Q4				Q1				Q2				Q3				Q4				Q1				Q2				Q3				Q4
		(in thousands, except share per share data and comparable store sales growth)
Net revenues		$	45,830			$	79,256			$	71,141			$	61,518			$	65,782			$	96,944			$	73,896			$	59,581			$	63,958			$	102,494			$	85,521			$	71,821
Gross profit			14,858				25,803				23,360				22,640				22,975				33,374				24,517				20,321				22,763				37,833				29,883				25,272
Operating income			599				6,460				4,362				1,241				2,478				6,417				2,581				(1,795	)			846				8,982				4,105				742
Net income (loss)			(1,217	)			2,221				1,012				(951	)			(203	)			2,265				536				(7,354	)			(2,000	)			6,002				1,211				(2,255	)
Basic and diluted income (loss) per share			(0.06	)			0.11				0.05				(0.04	)			(0.01	)			0.10				0.02				(0.33	)			(0.09	)			0.27				0.05				(0.10	)
Comparable store sales growth			(2.2)%				8.4%				12.6%				8.1%				23.9%				0.7%				(7.9)%				(4.9)%				(8.1)%				(0.5)%				6.2%				13.5%
Net revenues as a percentage of full year results			17.8%				30.7%				27.6%				23.9%				22.2%				32.7%				24.9%				20.2%				19.7%				31.6%				26.4%				22.3%

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	Cash Flows

	Operating Activities

	Investing Activities

	Financing Activities

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	Historical Indebtedness

	Senior Secured Notes

	Senior Secured Credit Facility

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	Indebtedness Following this Offering

	Contractual Obligations

			Payments Due by Period
							Less than
Contractual Obligations			Total				1 Year				1-3 Years				4-5 Years				After 5 Years
			(unaudited)
			(in thousands)
Long-term debt(1)			$	93,750			$	—			$	28,125			$	65,625			$	—
Operating leases			$	146,639			$	16,904			$	34,545			$	31,312			$	63,878
Purchase obligations(2)			$	10,703			$	9,576			$	866			$	261			$	—
	Total		$	251,092			$	26,480			$	63,536			$	97,198			$	63,878

(1)	We expect to retire all of our outstanding long-term debt with the proceeds from this offering together with borrowings under our new senior secured credit facility.
(2)	Purchase obligations consist of minimum royalty payments and services and goods we are committed to purchase in the ordinary course of business. Purchase obligations do not include contracts we can terminate without cause with little or no penalty to us.

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	Interest Rate Risk

	Foreign Currency Risks

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	•	Enhancing our guests’ in-store experience. We have emphasized a more attractive and upscale environment, in all of the stores we have opened since October 2002. We have also begun remodeling our older “warehouse-like” stores. We are incorporating hitting areas, putting greens and ball launch monitor technology in all of our stores, and we are introducing partial-flight indoor driving ranges in our larger stores. As part of our SmartFitTM clubfitting program, we are introducing Hot Stix® technology which analyzes a guest’s swing and recommends the clubs and golf balls from our inventory best suited to him or her. Additionally, a majority of our stores currently offer in-store golf lessons from a staff of PGA-certified teaching pros through our relationship with GolfTEC Learning Centers. We believe that this more attractive, activity-based shopping environment drives store traffic and increases revenues. We plan to complete the remodeling of our older stores by the end of 2007, each of which will then incorporate key elements of our new activity-based shopping environment.
	•	Reevaluating our store format. We have undertaken a thorough evaluation of our retail store portfolio in an effort to improve the financial performance of our store base. Based on our evaluation, we determined that our store concept is best suited to a 15,000 to 20,000 square foot store that enables us to accommodate the key elements of our activity-based shopping environment. We will generally seek to open new stores based on this prototype, although we currently operate larger and smaller stores based on our historical store base, and we may open new stores outside of this range depending on local market demographics and real estate prices and availability. Our larger stores enable us to devote the additional space to more hitting areas and larger partial-flight indoor driving ranges.
	•	Increasing our retail store base. We have doubled our store base from 26 stores in December 2002 to 52 stores in December 2005. We plan to open between 10 and 12 stores in 2006 and between 14 and 16 stores in 2007.

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	•	Expanding into the tennis category. Our acquisition of six Don Sherwood Golf & Tennis stores in July 2003 marked our entry into the tennis market. We believe that the tennis category is complementary to our core golf offering due to both sports’ appeal to similar demographics. To date, we have tennis departments in 33 of our stores and plan to continue to roll-out this category in our existing and future stores.

	•	we estimate that the golf retail market that we target represented over $6 billion in sales in the United States in 2005;
	•	the golf industry is highly fragmented relative to other retail industries, with no single golf retailer accounting for more than 5% of sales nationally in 2005; and
	•	off-course specialty retailers such as us have become the most popular source for golf equipment for high-spending avid golfers who play 25 or more rounds and/or spend $1,000 or more on golf each year.

	•	Brand awareness and customer recognition. Our 39-year history, nationwide catalog distribution and expansive store base have resulted in significant visibility of the Golfsmith brand, facilitating our entry into new markets and driving traffic to our Internet site. In addition to providing shopping convenience for our guests, our catalogs and Internet site serve as sales and marketing tools to increase the visibility of the Golfsmith brand and to generate greater traffic for our retail stores. As we further expand our store base in new markets, we intend to capitalize on our established and recognized brand and our existing customer base to enhance our position as one of the nation’s leading golf retailers.
	•	Extensive customer database. We use our extensive database, containing over 2.5 million names, to evaluate purchasing trends and behaviors, identify cross-marketing opportunities and target the most attractive potential locations for new stores. We also continually analyze

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		this information to evaluate advertising initiatives and improve the content of our Internet site and catalog offerings.
	•	Seamless shopping experience. Through our integrated multi-channel model, we provide our guests a seamless shopping experience across our retail stores, Internet site and catalogs, maintaining consistent product offerings and promotions. In addition, our multi-channel network allows guests to avoid delivery expenses and waiting time by ordering through our Internet site or catalogs and picking up their order in one of our retail stores.

	•	Premier branded merchandise. We are one of the largest retailers of premier branded golf merchandise. Our premier branded golf merchandise includes names such as adidas®, Callaway®, Cleveland®, Cobra®, FootJoy®, Mizuno®, Nike®, Ping®, TaylorMade® and Titleist®. We also offer the top tennis brands such as adidas®, Babolat®, Head®, Nike®, Prince®, Völkl® and Wilson®. We believe that our market position and strong vendor relationships generally provide us with greater access to new product innovations and large volume purchases at reduced prices. Our extensive offering of premier national brands is a critical component in driving traffic to our stores and distinguishes us from our competitors with a less extensive product offering, such as on-course pro shops and general sporting goods retailers.
	•	Proprietary products. We design, develop and market our high quality, proprietary branded merchandise under a variety of brand names, including Lynx®, Snake Eyes® and Zevo®. These brands are priced at lower price points than the premier branded merchandise we offer and generally appeal to our more value-conscious guests. Several of our brands are well-established and have long histories and strong reputations for quality and product performance. Our in-house research and development department has four decades of experience in the development and design of golf clubs and components. Sales of our proprietary branded products, including golf club components, accounted for $50.3 million, or 15.7%, of our net revenues in 2005 and generally have higher margins than non-proprietary branded products.
	•	Pre-owned clubs. Our pre-owned club offering appeals to value-conscious guests seeking premier brands at attractive prices. We believe our trade-in program promotes new product sales by offering our guests the ability to trade in their old clubs and receive credit toward the purchase of new clubs, thereby increasing our guests’ purchasing frequency and shortening their equipment replacement cycle.

	•	Activity-based shopping environment. All of our stores feature hitting areas, putting greens and ball launch monitor technology. Additionally, our larger stores contain partial-flight indoor driving ranges. We have also added “tennis tunnels” in two stores and plan to add tennis tunnels in five additional stores in 2006 to enable our guests to test the performance of a tennis racquet. Based on our experience, we believe that guests are significantly more likely to purchase a club or racquet if they test it first. In addition, we believe that the activity-based format of our stores keeps our guests in the store longer, enhances our brand name and allows our store associates, who we refer to as caddies, to strengthen their relationships with our guests.
	•	Customized golf-related services. We complement our extensive merchandise selection and activity-based shopping environment with a range of golf-related services. Guests in our stores can have a custom club fitting by one of our store caddies utilizing our SmartFitTM

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		program. We also offer Hot Stix® technology, which analyzes a guest’s swing and recommends the clubs and balls from our inventory that are best suited to that individual. In addition, most of our stores offer in-store golf lessons through GolfTEC Learning Centers’ staff of PGA-certified teaching professionals.

	•	90/90 Playability Guarantee. Our 90/90 Playability Guarantee is designed to ensure that our guests are completely satisfied with their club purchases by offering a 90% merchandise credit for certain clubs used and returned during the first 90 days following purchase.
	•	115% Low Price Guarantee. We believe that we provide the most aggressive price guarantee in our industry, whereby we will refund 115% of the difference in price if a guest notifies us within 30 days of purchase of a lower price offered by another authorized retailer.
	•	Clubvantage Program. We offer guests the opportunity to buy a two- or three-year club maintenance program when purchasing clubs, which, among other benefits, offers guests free labor on future re-gripping, re-shafting and repair services.
	•	Golfsmith Credit Card. We offer our own proprietary credit card, which provides our qualified guests with flexible payment options. As a result of our relationship with Wells Fargo, we do not bear any of the financing risk associated with this program.
	•	Player Rewards Loyalty Program. We plan to launch our Player Rewards program in 2006 in order to strengthen our relationship with our guests by offering them special benefits, coupons and discounts on select products and services.

	•	Enhance distribution logistics. Our infrastructure provides us with the flexibility to choose between shipping merchandise directly from our vendors to our stores or routing merchandise through our distribution and fulfillment center. We evaluate each product to determine which store distribution method is most cost-effective while increasing product availability for our guests.
	•	Provide best-in-class in-stock positions in our stores. We utilize our advanced replenishment system to monitor our in-stock position at each store and generate replenishments as needed. We reduce costly out-of-stock situations and excess inventory markdowns by automated supply chain monitoring. We believe that these benefits would be more costly and difficult to achieve without the capabilities offered by the integrated inventory management system that we have implemented across our channels.
	•	Centrally receive and allocate merchandise. The scale of our purchases, along with our centralized distribution and fulfillment center, enables our third-party vendors to make large quantity container shipments directly to us. After shipment to our centralized distribution facility, we then allocate these products optimally across our stores and direct-to-consumer channels based on demand. Our centralized distribution capabilities also enable us to participate more effectively in bulk purchase programs offered by our vendors, such as “power buys” of prior year’s models or volume discount purchases. Our centralized

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		distribution and fulfillment center is also essential to our proprietary branded products that are sourced from overseas and shipped to us in bulk.

	•	Improve store design. To increase customer traffic, we have developed a new store design that we are implementing in our new stores. We are also in the process of implementing key elements of our store design in most of our existing stores, which we plan to complete by the end of 2007. The new design includes a new store façade, incorporating eye-catching golf and tennis murals, as well as extensive remodeling of the store interior. We have improved the activity-based shopping environment of our stores by installing additional hitting areas, GolfTEC Learning Centers, and Hot Stix® club and ball selection technology. To enhance the shopping experience, we have also improved the overall look of our stores, particularly the apparel section, by adding laminated wood flooring, drop-down ceilings, improved lighting, inviting vendor displays and numerous large screen televisions broadcasting sporting events.
	•	Grow proprietary brands. Our proprietary branded products generally have higher margins than the premier national brands we offer and help to drive overall margin expansion. Because we believe that our proprietary brands appeal to more value-conscious guests and do not compete directly with our premier branded merchandise, we plan to grow our current portfolio of proprietary branded products to ensure that we continue to provide our guests with a compelling merchandise assortment that incorporates the latest technological advances at attractive prices. We also intend to further develop our range of non-golf club product categories, such as balls, tees, golf bags, travel covers and cases, golf carts, gloves, clothing, golf and tennis shoes and gifts.
	•	Enhance apparel offering. We intend to continue to increase our focus on apparel which provides attractive margins and a higher frequency of repeat purchases. We believe there is significant growth potential in apparel, particularly as we increasingly shift our product offering to premier brands and innovative products.

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	•	Target the female demographic. We have launched several initiatives to broaden our appeal to the underserved female golf enthusiast. As a result of increased media attention on women golfers, notably Michelle Wie, we believe that the female golfer demographic has grown. According to the National Golf Foundation, the number of core women golfers in the United States, defined as those playing at least eight rounds per year, was 2.5 million in 2004. While the number of core women golfers has remained steady during recent years, the number of occasional women golfers increased substantially from 2.9 million in 1998 to 4.4 million in 2004. In order to target women golfers we have enhanced our apparel offerings and introduced the “Drive” catalog, focusing solely on women golfers and their equipment and accessory needs, and the “Drive” portion of our Internet site that contains approximately 4,500 SKUs of women-specific products. We are also holding exclusive women’s promotions and events in our stores and are a retail sponsor of the Executive Women’s Golf Association.
	•	Expand the tennis category. As a result of the popularity of both golf and tennis among similar demographic groups, we believe that tennis provides a business opportunity that complements our golf retail business. Tennis also reemphasizes our strategy to target the female consumer who may come into our store because of our tennis product offerings and be exposed to our golf offerings.

Metropolitan Area		Location				Year Opened
Atlanta, Georgia			Duluth, Georgia				1997
			Kennesaw, Georgia				1998
			Buckhead, Georgia				2002
Austin, Texas			Austin (Headquarters), Texas				1996
			Austin (Arboretum), Texas				1998
Bay Area, California			San Francisco, California				2003
			Walnut Creek, California				2003
			Dublin, California				2003
			San Jose, California				2003
			Fremont, California				2003
			Palo Alto, California				2003
			San Carlos, California				2005

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Metropolitan Area		Location				Year Opened
Chicago, Illinois			Schaumburg, Illinois				1997
			Highland Park, Illinois				1997
			Downers Grove, Illinois				1998
			Lincoln Park, Illinois				2002
Columbus, Ohio			Columbus, Ohio				1998
Dallas, Texas			Dallas (Midway), Texas				1996
			Plano, Texas				1998
			Arlington, Texas				1998
			Frisco, Texas				2004
Denver, Colorado			Westminster, Colorado				1996
			Denver, Colorado				1997
			Golden, Colorado				2005
Detroit, Michigan			Troy, Michigan				1999
			Northville, Michigan				1999
			Auburn Hills, Michigan				2003
Houston, Texas			Houston (North), Texas				1995
			Houston (Westheimer), Texas				1997
			Baybrook, Texas				2004
Los Angeles, California			Ontario, California				1999
			Woodland Hills, California				1999
			Pasadena, California				2002
			Santa Ana, California				2003
			El Segundo, California				2003
			Oxnard, California				2004
Miami, Florida			Hollywood, Florida				2005
Minneapolis, Minnesota			Minnetonka, Minnesota				1998
Orlando, Florida			Millenia, Florida				2004
			Altamonte Springs, Florida				2005
Philadelphia, Pennsylvania			Moorestown, New Jersey				2005
Phoenix, Arizona			Glendale, Arizona				1997
			Chandler, Arizona				1998
			Scottsdale, Arizona				2004
San Diego, California			Mission Valley, California				2004
Tri-State Area			East Northport, New York				2003
(New York, New Jersey			Norwalk, Connecticut				2003
and Connecticut)			Scarsdale, New York				2003
			Paramus, New Jersey				2004
			Livingston, New Jersey				2004
			Carle Place, New York				2005
			Bridgewater, New Jersey				2005

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	Store Design

	New Store Site Selection

	•	demographic characteristics, such as a high number of avid golfers and above-average annual household incomes;
	•	visibility from and access to highways or other major roadways;
	•	the level of our penetration in a given market, either through our existing retail stores or our direct-to-consumer channel;

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	•	original equipment manufacturer information indicating that a location is within a top merchandising market;
	•	proximity to a large metropolitan area;
	•	presence and strength of competition;
	•	the ability to obtain favorable lease terms; and
	•	“Big Box” retail co-tenants that are likely to draw guests who we would otherwise target within the site’s relevant market.

	Internet

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	Catalogs

	Branded Products

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	Golfsmith Proprietary Brands

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	Club Components

	•	90/90 Playability Guarantee. We believe that our playability guarantee provides us with a distinct competitive advantage. This initiative allows our guests to purchase and use certain clubs for up to 90 days. If a guest decides to return the clubs, we offer the guest a merchandise credit worth 90% of the price of the clubs. We are able to provide this service in part because of our ability to resell such clubs through our pre-owned club offerings, thereby minimizing the impact on our gross margins.
	•	115% Price Guarantee. We offer a 115% low price guarantee that we believe to be the most aggressive guarantee in the industry, whereby we will refund 115% of the difference in purchase price if a guest notifies us within 30 days of purchase of a lower price offered by another authorized retailer.
	•	Club Trade-Ins. Our Club Trade-In Program allows guests to receive a merchandise credit for their pre-owned clubs which can be applied toward the purchase price of new clubs or other products. Guests can trade-in their clubs at any store. Alternatively, our Internet site provides a step-by-step process for guests to grade their pre-owned clubs, determine their value and place an order for new clubs. The guest then sends the pre-owned clubs to us after receiving the new clubs. Our Club Trade-In Program is enhanced by periodic initiatives such as our National Trade-In Days program where guests are given additional value for bringing in their used clubs for an upgrade of equipment or accessories. We have also created a “blue book” for golf clubs so that our customers know in advance the expected trade-in price and can be assured consistent pricing across our channels. By providing an available market for our guests’ used clubs and reducing the cost of new clubs for many guests, we believe that our Club Trade-In Program assists us in developing new guest relationships and reduces the equipment replacement cycle. In addition, we sell the pre-owned clubs that we acquire through this program in our stores and through our Internet site to value-conscious guests.
	•	Golfsmith Credit Card. To meet our guests’ needs, we offer our own proprietary credit card, which provides our qualified guests with flexible payment options for their Golfsmith purchases. As a result of our partnership with Wells Fargo, we do not bear any of the financing risk associated with this program.
	•	Loyalty Program. In the second quarter of 2006, we plan to launch our Player Rewards program to attract, incentivize and retain guests that shop five or more times per year for either golf and tennis merchandise across all of our channels. The program will be free to all

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		guests and will offer guests advance notice of sales and special events, exclusive invitations to VIP-only events, special pricing on select items, trade-in bonuses and coupons and discounts on select products and services.

	•	SmartFit™ Custom Club Fitting Program. We offer guests the ability to custom fit their clubs through our SmartFitTM program. Through our SmartFitTM program, we customize premier and proprietary branded clubs to the guest’s physical profile (height, wrist-to-floor distance and hand size), swing speed and their desired game characteristics (trajectory, control and distance). We also have the ability to custom build a set of golf clubs from scratch using our clubmaking technology and components. Our SmartFittm program is available to our guests at every store, as well as through our Internet site and catalogs, which we believe differentiates us from our competitors.
	•	Hot Stix® Precision Equipment Recommendation. We license Hot Stix® proprietary technology, which analyzes a guest’s swing and recommends the type of clubs and golf balls from our inventory that are best suited to that individual. We believe that this technology increases our guests’ satisfaction with their club purchases and fosters guest loyalty and potentially reduces product returns.
	•	GolfTEC Learning Centers. Our relationship with GolfTEC Learning Centers, the nation’s leading provider of golf lessons with over 128,000 individual lessons in 2005, complements our outstanding caddy team. GolfTEC’s proprietary system features digital video, motion analysis and ball-flight projection to allow its staff of PGA-certified teaching pros to analyze our guest’s swing and compare it to a database of the swings of various professional golfers. In addition, GolfTEC provides software that enables guests to review their lesson, drills and instructor comments online. Guests’ participation in GolfTEC lessons drives traffic and sales within our stores as our guests buy lesson packages that encourage repeat visits to our store location. As of December 31, 2005, GolfTEC provided in-store golf lessons in 27 of our stores. During 2006, we plan to modify three of our existing stores to accommodate in-store golf lessons by GolfTEC.
	•	Club Repair and Clubvantage Program. We offer repair services at all of our stores. In order to encourage guests to use these services, we offer two-year and three-year plans under our Clubvantage program that enable guests to cover the labor costs associated with re-gripping, re-shafting and repairing individual clubs or club sets for an upfront fee. The program provides additional benefits, such as an additional credit on any clubs that are traded-in and a savings certificate for the Harvey Penick Golf Academy.
	•	Expert Racquet Stringing. As a member of the U.S. Racquet Stringers Association, we are able to offer our guests expert racquet stringing services. Our professionally trained Master Racquet Technicians have passed comprehensive tests to ensure their knowledge and understanding of racquet service. Our Master Racquet Technicians provide our guests with a full range of racquet services and answer their racquet-related questions.

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	•	Increased access to and visibility of golf. The National Golf Foundation determined that golf course facilities have grown from 12,846 in 1994 to 16,052 in 2005. The PGA, LPGA, USGA, World Golf Foundation and others have introduced numerous programs designed to attract, develop and retain golfers, including offering discounted or free lessons to beginning golfers. In addition, the proliferation of professional and amateur golf events and accompanying media coverage and television exposure has further increased the visibility of the sport. As a result of several factors, including the launch of The Golf Channel® and the emergence of golf superstar Tiger Woods, advertising and promotions by equipment manufacturers have increased.
	•	Fragmented market. The golf retail industry is highly fragmented relative to other retail industries, with no single golf retailer accounting for more than 5% of sales nationally in 2005. Specialty off-course retailers lead the retail channel for golf equipment and accessories, and we expect this trend to continue. This trend is driven in part by the ability of off-course retailers to offer a larger selection at competitive prices while offering customers putting greens, hitting areas and other amenities.
	•	Favorable demographic growth. While participation rates have leveled off over the last five years, we expect a growth in participation rates over the next decade as the “baby boomer” generation ages and as more women participate. Golf is one of the few sports which people spend more time playing as they age. The United States Census Bureau estimated that there were approximately 78 million baby boomers in the United States in 2004. According to the National Golf Foundation, if baby boomers in the future behave as senior golfers, aged 60 and above, do today, the number of rounds played by this demographic will increase significantly. Today, baby boomers have a 12.5% participation rate and play an average of 20.5 rounds a year. If they behave like the current generation of senior golfers, their participation rate will drop over time to 9.7% but average rounds will rise to 39.6 per year. Additionally, the National Golf Foundation concluded that golfers over the age of 45 years spend a disproportionate amount on golf (including greens fees and other items outside our products and services). In addition, according to the National Golf Foundation, the number of women golfers has increased from approximately 5.4 million in 1998 to approximately 6.9 million in 2004, representing an increase of 28%. The average annual rounds played by women is very close to the average played by men.

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	•	High spending by avid golfers. According to the National Golf Foundation, in 2002 there were approximately 6.0 million avid golfers representing 23% of all golfers and responsible for driving approximately 63% of golf equipment sales. Avid golfers are interested in learning about and buying the latest equipment, upgrading putters and drivers with greater regularity than casual golfers. In addition, avid golfers and golfers who spend $1,000 or more on golf per year purchased more equipment from off-course golf specialty retailers in 2003 than any other channel. For these reasons, avid golfers are an important target customer group.
	•	Technological cycles. Substantial technological advancements in equipment over the past decade have shortened product replacement cycles and increased prices. Significant advances have been achieved in club head, shaft and golf ball construction, design and materials. The recent popularity of utility or “hybrid” clubs, a category of clubs that combines elements of both woods and irons into their design are driving another product replacement cycle. The introduction of new and improved products, together with advertising and promotions by equipment manufacturers and retailers emphasizing the importance of proper equipment to one’s game, has encouraged golfers to change their equipment more frequently. Avid golfers, in particular, appear more willing to invest at the front-end of product cycles at or near the manufacturer’s recommended retail price.

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		Size
Location		(sq. ft.)				Facility Type		Owned/Leased
Austin, Texas			60,000			Office			Owned
Austin, Texas			240,000			Distribution and Fulfillment Center			Owned
Austin, Texas			17 Acres			Driving Range and Training Facility			Owned
Toronto Canada			3,906			Direct-To-Consumer Order Fulfillment Facility			Leased
St. Ives, Cambridgeshire, England			15,900			Office, Warehouse and Shipping Facility			Leased

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Name		Age				Position
James D. Thompson			43			Chief Executive Officer, President and Director
Virginia Bunte			40			Senior Vice President — Chief Financial Officer and Treasurer
Kenneth Brugh			55			Senior Vice President — Real Estate and New Business Development
Fred Quandt			36			Senior Vice President — Merchandising
David Pritchett			41			Senior Vice President — Retail Operations
Kiprian Miles			44			Vice President — Chief Information Officer
Jeff Sheets			46			Vice President — Research and Development
Matthew Corey			39			Vice President — Marketing
David Lowe			45			Vice President — Brands and Golf Instruction
Charles Shaw(1)			72			Chairman of the Board
Roberto Buaron			59			Director
James Grover(2)			34			Director
Noel Wilens(1)			43			Director
Thomas G. Hardy(2)			60			Director
James Long			63			Director
Lawrence Mondry			45			Director

(1)	Member of our nominating and compensation committee.
(2)	Member of our audit committee.

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	•	retaining and terminating the company’s independent accountants, subject to stockholder ratification;
	•	pre-approval of audit and non-audit services provided by the independent accountants; and
	•	approval of transactions with office holders and controlling stockholders, as described above, and other related-party transactions.

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																	Long-Term
																	Compensation
			Annual Compensation
																	Securities
													Other Annual				Underlying
Name and Principal Position			Year		Salary				Bonus				Compensation(1)				Options(2)
James D. Thompson(3)			2005		$	325,000			$	243,750			$	2,100				—
	President and Chief		2004			314,615				—				3,637				—
	Executive Officer		2003			297,000				—				3,561				400,000
Virginia Bunte(4)			2005		$	181,500			$	136,125			$	5,445				—
	Senior Vice President — Chief		2004			181,092				—				5,407				—
	Financial Officer and Treasurer		2003			161,580				—				5,585				90,000
Kenneth Brugh(5)			2005		$	200,000			$	92,000			$	—				—
	Vice President — Real Estate		2004			200,000				—				—				—
	and New Business Development		2003			200,000				—				—				90,000
Matthew Corey(6)			2005		$	195,000			$	78,000			$	2,925				—
	Vice President — Marketing		2004			24,643				51,967				—				90,000
			2003			—				—				—				—
Fred Quandt(7)			2005		$	180,000			$	82,800			$	4,050				—
	Senior Vice President —		2004			164,238				—				3,624				—
	Merchandising		2003			125,000				—				3,168				90,000

(1)	Represents matching contributions made by us under our Retirement Savings Plan.
(2)	Represents grants of options to purchase shares of our common stock under the Golfsmith International Holdings, Inc. 2002 Incentive Stock Plan.
(3)	Mr. Thompson became our President and Chief Executive Officer in October 2002.
(4)	Ms. Bunte became our Senior Vice President — Chief Financial Officer and Treasurer in February 2006. Prior to that, Ms. Bunte was our Vice President — Chief Financial Officer.
(5)	Mr. Brugh became our Senior Vice President — Real Estate and New Business Development in February 2006. Prior to that, Mr. Brugh was our Vice President — Retail and Real Estate.
(6)	Mr. Corey became our Vice President — Marketing in November 2004.
(7)	Mr. Quandt became our Senior Vice President — Merchandising in February 2006. Prior to that, Mr. Quandt was our Vice President — Merchandising.

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Number of Securities

Value of Unexercised

Underlying Unexercised

in-the-Money

Shares

Options at December 31, 2005

Options at December 31, 2005

Acquired

Value

Name

on Exercise

Realized

Exercisable

Unexercisable

Exercisable

Unexercisable

James D. Thompson

—

400,000

Virginia Bunte

—

90,000

Kenneth Brugh

—

90,000

Matthew Corey

—

90,000

Fred Quandt

—

90,000

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	2006 Incentive Compensation Plan

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	2002 Incentive Stock Plan

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	Management Incentive Plan

	401(k) Plan

	Severance Pay Plan

	•	current position (Senior Vice President, Vice President, director or manager, or other full time employee);
	•	current salary; and
	•	length of service with us.

	•	for any breach of their duty of loyalty to us or our stockholders;
	•	for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;
	•	for unlawful payments of dividends or unlawful stock repurchases or redemptions, as provided under Section 174 of the Delaware General Corporation Law; or
	•	for any transaction from which the director derived improper personal benefit.

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	Registration Rights

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	Provisions Regarding our Shares

	Board Composition

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	•	each of our executive officers;
	•	each of our directors;
	•	all of our executive officers and directors as a group; and
	•	each person known to us to be a beneficial owner of more than 5% of our outstanding common stock.

		Before Offering								After Offering								Percent of
																		Class Beneficially
		Shares								Shares								Owned Assuming
		Beneficially				Percent of				Beneficially				Percent of				Exercise of Over-
Beneficial Owner		Owned				Class				Owned				Class				Allotment Option
Atlantic Equity Partners III, L.P.(1)			18,088,888				83.8	%
Carl Paul(2)			3,505,709				16.2	%
Franklin Paul(2)			3,505,709				16.2	%
Roberto Buaron(3)			18,088,888				83.8	%
James D. Thompson(4)			—				—
Virginia Bunte(5)			—				—
Kenneth Brugh(6)			—				—
Matthew Corey			—				—
Fred Quandt(7)			—				—
Kiprian Miles			—				—
Jeff Sheets			—				—
David Lowe			—				—
Charles Shaw(8)			—				—
James Grover(9)			—				—
Thomas G. Hardy(10)			89,043					*
James Long(11)			—				—
Noel Wilens(12)			—				—
All directors and executive officers as a group (18 persons)			18,177,931				84.2	%

77

---

 

	*	Represents less than 1%.
	(1)	Consists of 18,088,888 shares owned by Atlantic Equity Partners III, L.P. Does not include 3,505,709 shares owned by Carl and Franklin Paul that are subject to a stockholders agreement pursuant to which Carl and Franklin Paul have agreed to vote such shares in favor of nominees to our board of directors proposed by Atlantic Equity Partners III, L.P. These nomination rights will terminate upon the closing of this offering. As a result of this arrangement, Atlantic Equity Partners III, L.P. may be deemed to be the beneficial owner of the shares held by Carl and Franklin Paul. Atlantic Equity Partners III, L.P. disclaims beneficial ownership of these shares. Atlantic Equity Partners III, L.P.’s address is c/o First Atlantic Capital, Ltd., 135 East 57th Street, New York, New York 10022. As described in footnote 3 below, Roberto Buaron, one of our directors, has voting and investment power over the shares of our common stock of owned by Atlantic Equity Partners III, L.P.
	(2)	Consists of 2,234,158 shares owned by Carl Paul and 1,182,508 shares owned by Franklin Paul. Does not include 18,088,888 shares owned by Atlantic Equity Partners III, L.P. that are subject to the stockholders agreement described in footnote (1) pursuant to which Atlantic Equity Partners III, L.P. has agreed to vote such shares in favor of one nominee to our board of directors selected by Carl and Franklin Paul. These nomination rights will terminate upon the closing of this offering. As a result of this arrangement, Carl and Franklin Paul may be deemed to be the beneficial owners of the shares held by Atlantic Equity Partners III, L.P. Each of Carl and Franklin Paul disclaims beneficial ownership of the shares owned by Atlantic Equity Partners III, L.P. The address of each of Carl and Franklin Paul is c/o Golfsmith International Holdings, Inc., 11000 N. IH-35, Austin, Texas 78753-3195.
	(3)	Consists of 18,088,888 shares owned by Atlantic Equity Partners III, L.P. Mr. Buaron is the sole member of Buaron Capital Corporation III, LLC. Buaron Capital Corporation III, LLC is the managing member of Atlantic Equity Associates III, LLC. Atlantic Equity Associates III, LLC is the sole general partner of Atlantic Equity Associates III, L.P., which is the sole general partner of Atlantic Equity Partners III, L.P. and, as such, exercises voting and investment power over shares of capital stock owned by Atlantic Equity Partners III, L.P., including shares of our common stock. Mr. Buaron, as the sole member of Buaron Capital Corporation III, LLC has voting and investment power over, and may be deemed to beneficially own, the shares of our common stock owned by Atlantic Equity Partners III, L.P. Excludes 3,505,709 shares owned by Carl and Franklin Paul which Atlantic Equity Partners III, L.P. may be deemed to beneficially own by virtue of the stockholders agreement described in footnote (1). Mr. Buaron disclaims beneficial ownership of the shares owned by Carl and Franklin Paul and, except to the extent of his pecuniary interest therein, the shares held by Atlantic Equity Partners III, L.P. Mr. Buaron’s address is c/o First Atlantic Capital, Ltd., 135 East 57th Street, New York, New York 10022.
	(4)	Does not include equity units held by Mr. Thompson which entitle the holder thereof to 149,750 shares of common stock.
	(5)	Does not include equity units held by Ms. Bunte which entitle the holder thereof to 12,563 shares of common stock.
	(6)	Does not include equity units held by Mr. Brugh which entitle the holder thereof to 128,100 shares of common stock.
	(7)	Does not include equity units held by Mr. Quandt which entitle the holder thereof to 12,188 shares of common stock.
	(8)	Mr. Shaw’s address is c/o First Atlantic Capital, Ltd., 135 East 57th Street, New York, New York 10022.
	(9)	Mr. Grover’s address is c/o First Atlantic Capital, Ltd., 135 East 57th Street, New York, New York 10022.

(10)	Mr. Hardy’s address is 935 Park Avenue, New York, New York 10028.
(11)	Mr. Long’s address is c/o First Atlantic Capital, Ltd., 135 East 57th Street, New York, New York 10022.
(12)	Mr. Wilens’s address is c/o First Atlantic Capital, Ltd., 135 East 57th Street, New York, New York 10022.

78

---

 

	•	prior to that date, the board of directors of the corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder;
	•	upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding those shares owned by persons who are directors and also officers and by excluding employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

79

---

 

	•	on or subsequent to that date, the business combination is approved by the board of directors of the corporation and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 662/3% of the outstanding voting stock that is not owned by the interested stockholder.

80

---

 

81

---

 

	•	shares will be eligible for sale on the date of this prospectus;
	•	shares will be eligible for sale beginning 180 days after the date of this prospectus upon the expiration of the lock-up agreements as described below, of which                will be subject to volume limitations under Rule 144; and
	•	shares will be eligible for sale more than 180 days after the date of this prospectus, of which                will be subject to volume limitations under Rule 144.

	•	1% of the then outstanding shares of our common stock, which is expected to equal approximately                      shares immediately after this offering, or

82

---

 

	•	the average weekly trading volume of our common stock on the Nasdaq National Market during the four calendar weeks preceding the filing with the SEC of a notice on Form 144 with respect to such sale.

83

---

 

	•	a citizen or resident of the United States;
	•	a corporation, or an entity classified as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States, any state thereof, or the District of Columbia;
	•	an estate, the income of which is subject to U.S. federal income tax regardless of its source; or
	•	a trust if such trust validly elects to be treated as a United States person for U.S. federal income tax purposes or if (a) a court within the United States is able to exercise primary supervision over its administration and (b) one or more United States persons have the authority to control all of the substantial decisions of the trust.

	•	financial institutions or insurance companies;
	•	real estate investment trusts, regulated investment companies or grantor trusts;
	•	dealers or traders in securities or currencies;
	•	tax-exempt entities;
	•	certain former citizens or residents of the United States;
	•	persons that received our common stock as compensation for the performance of services;
	•	persons that will hold our common stock as part of a “hedging” or “conversion” transaction or as a position in a “straddle” for U.S. federal income tax purposes;
	•	persons that have a “functional currency” other than the U.S. dollar; or
	•	holders that own or are deemed to own 10% or more, by voting power or value, of our stock.

84

---

 

85

---

 

86

---

 

87

---

 

		Number
Underwriter		of Shares
Merrill Lynch, Pierce, Fenner & Smith Incorporated
J.P. Morgan Securities Inc.
Lazard Capital Markets LLC
Total

Per Share

Without Option

With Option

Public offering price

$

$

$

Underwriting discount

$

$

$

Proceeds, before expenses, to Golfsmith International Holdings, Inc.

$

$

$

88

---

 

	•	offer, pledge, sell or contract to sell any common stock;
	•	sell any option or contract to purchase any common stock;
	•	purchase any option or contract to sell any common stock;
	•	grant any option, right or warrant for the sale of any common stock;
	•	lend or otherwise dispose of or transfer any common stock;
	•	request or demand that we file a registration statement related to the common stock; or
	•	enter into any swap or other agreement that transfers, in whole or in part, the economic consequence of ownership of any common stock whether any such swap or transaction is to be settled by delivery of shares or other securities, in cash or otherwise.

89

---

 

	•	the valuation multiples of publicly traded companies that the representative believes to be comparable to us,
	•	our financial information,
	•	the history of, and the prospects for, our company and the industry in which we compete,
	•	an assessment of our management, its past and present operations, and the prospects for, and timing of, our future revenues,
	•	the present state of our development, and
	•	the above factors in relation to market values and various valuation measures of other companies engaged in activities similar to ours.

90

---

 

	•	to legal entities which are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities;
	•	to any legal entity which has two or more of (1) an average of at least 250 employees during the last financial year, (2) a total balance sheet of more than €43,000,000, and (3) an annual net turnover of more than €50,000,000 as shown in its last annual or consolidated accounts; or
	•	in any other circumstances which do not require the publication by the issuer of a prospectus pursuant to Article 3 of the Prospectus Directive.

91

---

 

	•	made by investment firms, banks or financial intermediaries permitted to conduct such activities in the Republic of Italy in accordance with Legislative Decree No. 385 of September 1, 1993 (the “Banking Act”), Decree No. 58 of February 24, 1998, Regulation No. 11522, as amended, and any other applicable laws and regulations; and
	•	in compliance with any other applicable notification requirement or limitation which may be imposed upon the offer of the shares stock in Italy by CONSOB.

92

---

 

93

---

 

94

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		Page
Report of Independent Registered Public Accounting Firm			F-2
Consolidated Balance Sheets at December 31, 2005 and January 1, 2005			F-3
Consolidated Statements of Operations for the fiscal year ended December 31, 2005, the fiscal year ended January 1, 2005 and the fiscal year ended January 3, 2004			F-5
Consolidated Statements of Stockholders’ Equity and Comprehensive Income for the fiscal year ended December 31, 2005, the fiscal year ended January 1, 2005 and the fiscal year ended January 3, 2004			F-6
Consolidated Statements of Cash Flows for the fiscal year ended December 31, 2005, the fiscal year ended January 1, 2005 and the fiscal year ended January 3, 2004			F-7
Notes to Consolidated Financial Statements			F-8

F-1

---

 

	/s/ ERNST & YOUNG LLP

F-2

---

 

			December 31,				January 1,
			2005				2005
ASSETS
Current assets:
	Cash and cash equivalents		$	4,207,497			$	8,574,966
	Receivables, net of allowances of $146,964 at December 31, 2005 and $161,838 at January 1, 2005			1,646,454				854,555
	Inventories			71,472,061				54,197,532
	Prepaid and other current assets			6,638,109				6,405,525
Total current assets				83,964,121				70,032,578
Property and equipment:
	Land and buildings			21,256,771				21,133,430
	Equipment, furniture, fixtures			19,004,608				15,174,320
	Leasehold improvements and construction in progress			20,866,839				15,247,612
				61,128,218				51,555,362
	Less: accumulated depreciation and amortization			(14,558,256	)			(10,647,641	)
Net property and equipment				46,569,962				40,907,721
Goodwill				41,634,525				41,634,525
Tradenames				11,158,000				11,158,000
Trademarks				14,156,127				14,483,175
Customer database, net of accumulated amortization of $1,227,490 at December 31, 2005 and $849,801 at January 1, 2005				2,171,715				2,549,404
Debt issuance costs, net of accumulated amortization of $3,126,103 at December 31, 2005 and $2,062,104 at January 1, 2005				4,731,612				5,795,611
Other long-term assets				450,208				368,285
Total assets			$	204,836,270			$	186,929,299

F-3

---

 

				December 31,				January 1,
				2005				2005
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
	Accounts payable			$	42,000,236			$	31,006,493
	Accrued expenses and other current liabilities				19,163,459				18,717,115
	Lines of credit				—				—
Total current liabilities					61,163,695				49,723,608
Long-term debt, less current maturities					82,450,000				79,808,033
Deferred rent liabilities					4,095,442				3,084,367
Total liabilities					147,709,137				132,616,008
Stockholders’ Equity:
	Common stock –$.001 par value; 40,000,000 shares authorized; 21,594,597 shares issued and outstanding at December 31, 2005 and January 1, 2005				21,594				21,594
		Restricted stock units –$.001 par value; 755,935 shares issued and outstanding at December 31, 2005 and January 1, 2005			756				756
	Additional capital				60,288,607				60,288,607
	Other comprehensive income				135,815				279,607
	Accumulated deficit				(3,319,639	)			(6,277,273	)
Total stockholders’ equity					57,127,133				54,313,291
Total liabilities and stockholders’ equity				$	204,836,270			$	186,929,299

F-4

---

 

		Fiscal Year
		Ended				Fiscal Year				Fiscal Year
		December 31,				Ended				Ended
		2005				January 1, 2005				January 3, 2004
Net revenues		$	323,794,225			$	296,202,149			$	257,744,780
Cost of products sold			208,044,286				195,014,579				171,083,110
Gross profit			115,749,939				101,187,570				86,661,670
Selling, general and administrative			99,310,158				90,763,231				73,400,271
Store pre-opening expenses			1,764,685				742,880				599,603
Total operating expenses			101,074,843				91,506,111				73,999,874
Operating income			14,675,096				9,681,459				12,661,796
Interest expense			(11,744,232	)			(11,240,550	)			(11,156,792	)
Interest income			73,263				63,939				39,776
Other income			469,841				1,178,790				210,707
Other expense			(116,331	)			(16,530	)			(46,270	)
Income (loss) from operations before income taxes			3,357,637				(332,892	)			1,709,217
Income tax expense			(400,003	)			(4,422,724	)			(644,953	)
Net income (loss)		$	2,957,634			$	(4,755,616	)		$	1,064,264
Basic and diluted net income (loss) per share of common stock		$	0.13			$	(0.21	)		$	0.05
Basic weighted average common shares outstanding			22,350,532				22,350,532				21,523,956
Diluted weighted average common shares outstanding			22,668,785				22,350,532				21,523,956

F-5

---

 

												Restricted Stock
				Common Stock								Units												Other
																				Additional				Comprehensive				Accumulated				Stockholders’
				Shares				Amount				Shares				Amount				Capital				Income				Deficit				Equity
Balance at December 28, 2002					20,077,931			$	20,078				839,268			$	839			$	55,990,042			$	48,148			$	(2,585,921	)		$	53,473,186
Issuance of common stock					1,433,333				1,433				—				—				4,298,565				—				—				4,299,998
Conversion of restricted stock					83,333				83				(83,333	)			(83	)			—				—				—				—
Comprehensive loss:
	Translation adjustments, cumulative translation gain of $186,877 at January 3, 2004				—				—				—				—				—				138,729				—				138,729
	Net income				—				—				—				—				—				—				1,064,264				1,064,264
		Total comprehensive income			—				—				—				—				—				—				—				1,202,993
Balance at January 3, 2004					21,594,597			$	21,594				755,935			$	756			$	60,288,607			$	186,877			$	(1,521,657	)		$	58,976,177
Comprehensive loss:
	Translation adjustments, cumulative translation gain of $279,607 at January 1, 2005				—				—				—				—				—				92,730				—				92,730
	Net loss				—				—				—				—				—				—				(4,755,616	)			(4,755,616	)
		Total comprehensive loss			—				—				—				—				—				—				—				(4,662,886	)
Balance at January 1, 2005					21,594,597			$	21,594				755,935			$	756			$	60,288,607			$	279,607			$	(6,277,273	)		$	54,313,291
Comprehensive loss:
	Translation adjustments, cumulative translation gain of $135,815 at December 31, 2005				—				—				—				—				—				(143,792	)			—				(143,792	)
	Net income				—				—				—				—				—				—				2,957,634				2,957,634
		Total comprehensive income			—				—				—				—				—				—				—				2,813,842
Balance at December 31, 2005					21,594,597			$	21,594				755,935			$	756			$	60,288,607			$	135,815			$	(3,319,639	)		$	57,127,133

F-6

---

 

				Fiscal Year				Fiscal Year				Fiscal Year
				Ended				Ended				Ended
				December 31,				January 1,				January 3,
				2005				2005				2004
Operating Activities
Net income (loss)				$	2,957,634			$	(4,755,616	)		$	1,064,264
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
	Depreciation				5,489,782				5,261,001				4,850,711
	Amortization of intangible assets				377,689				377,690				377,689
	Amortization of debt issue costs and debt discount				3,705,966				3,300,169				3,011,179
	Non-cash loss on write-off of property and equipment				1,480,601				476,713				—
	Net loss (gain) on sale of real estate and other assets				(370,613	)			(1,064,045	)			3,069
	Changes in operating assets and liabilities:
		Accounts receivable			(791,899	)			525,737				(1,109,008	)
		Inventories			(17,274,529	)			(2,982,474	)			(14,196,793	)
		Prepaid and other current assets			(232,584	)			(3,037,537	)			379,638
		Deferred income taxes			—				4,162,096				179,970
		Other assets			(81,923	)			(321,352	)			(56,333	)
		Accounts payable			10,993,743				9,425,215				5,931,850
		Accrued expenses and other current liabilities			433,246				1,952,201				2,632,298
		Deferred rent			1,011,075				2,000,856				570,187
Net cash provided by operating activities					7,698,188				15,320,654				3,638,721
Investing Activities
Purchase of property, plant and equipment					(12,655,232	)			(8,567,480	)			(5,759,429	)
Proceeds from sale of real estate and other assets					731,463				2,105,000				18,046
Purchase of assets and other					—				—				(956,676	)
Purchase of business, net of cash received					—				—				(8,585,560	)
Net cash used in investing activities					(11,923,769	)			(6,462,480	)			(15,283,619	)
Financing Activities
Principal payments on lines of credit					(47,198,103	)			(33,524,025	)			(27,178,727	)
Proceeds from lines of credit					47,198,103				32,106,986				28,595,766
Proceeds from issuance of common stock					—				—				4,299,998
Debt issuance costs					—				—				(82,410	)
Other					(2,244	)			(6,607	)			(23,264	)
Net cash provided by (used in) financing activities					(2,244	)			(1,423,646	)			5,611,363
Effect of exchange rate changes on cash					(139,644	)			89,894				134,506
Change in cash and cash equivalents					(4,367,469	)			7,524,422				(5,899,029	)
Cash and cash equivalents, beginning of period					8,574,966				1,050,544				6,949,573
Cash and cash equivalents, end of period				$	4,207,497			$	8,574,966			$	1,050,544
Supplemental cash flow information:
Interest payments				$	8,031,328			$	7,968,535			$	7,130,032
Tax payments					724,766				304,180				699,198
Amortization of discount on senior secured notes					2,641,967				2,325,564				2,102,424

F-7

---

 

1.	Nature of Business and Summary of Significant Accounting Policies

	Description of Business

	Basis of Presentation

	Use of Estimates

	Reclassifications

F-8

---

 

	Cash Equivalents

	Accounts Receivable

	Inventories

	Concentration of Foreign Suppliers

	Property and Equipment

	Long-Lived Assets

F-9

---

 

	Store Pre-opening and Closing Expenses

	Operating Leases

F-10

---

 

	Foreign Currency Translation

	Concentrations of Credit Risk

	Fair Value of Financial Instruments

	Revenue Recognition

F-11

---

 

	Sales Incentives

	Shipping and Handling Costs

	Vendor Rebates and Promotions

F-12

---

 

	Income Taxes

	Catalog Costs and Advertising

	Debt Issuance Costs

	Goodwill and Intangible Assets

F-13

---

 

	Insurance and Self-Insurance Reserves

F-14

---

 

	Stock-Based Compensation

			Fiscal Year				Fiscal Year				Fiscal Year
			Ended				Ended				Ended
			December 31,				January 1,				January 3,
			2005				2005				2004
Net Income (loss) as reported			$	2,957,634			$	(4,755,616	)		$	1,064,264
Total stock-based compensation cost, net of related tax effects included in the determination of net income (loss) as reported				—				—				—
The stock-based employee compensation cost, net of related tax effects, that would have been included in the determination of net income (loss) if the fair value based method had been applied to all awards				(226,531	)			(156,012	)			(97,585	)
Pro forma net income (loss)			$	2,731,103			$	(4,911,628	)		$	966,679
Earnings per share:
	Basic and diluted — as reported		$	0.13			$	(0.21	)		$	0.05
	Basic and diluted — pro forma		$	0.12			$	(0.21	)		$	0.05

	Segments

	Fiscal Year

	Recently Issued Accounting Standards

F-15

---

 

2.	Business Combinations

	Don Sherwood Golf & Tennis

F-16

---

 

3.	Asset Acquisition

4.	Intangible Assets

		Fiscal Year				Fiscal Year
		Ended				Ended
		December 31,				January 1,
		2005				2005
Customer database gross carrying amount		$	3,399,205			$	3,399,205
Accumulated amortization			(1,227,490	)			(849,801	)
Customer database net carrying amount		$	2,171,715			$	2,549,404

2006		$	377,689
2007			377,689
2008			377,689
2009			377,689
2010			377,689
Thereafter			283,270
		$	2,171,715

5.	Debt

		Fiscal Year				Fiscal Year
		Ended				Ended
		December 31,				January 1,
		2005				2005
Senior secured notes due October 15, 2009 (see discussion below)		$	93,750,000			$	93,750,000
Total long-term debt			93,750,000				93,750,000
Less current maturities			—				—
Long-term portion			93,750,000				93,750,000
Unamortized discount on senior secured notes			(11,300,000	)			(13,941,967	)
Long-term debt, net of discount		$	82,450,000			$	79,808,033

F-17

---

 

2006		$	—
2007			18,750,000
2008			9,375,000
2009			65,625,000
2010			—
Thereafter			—
		$	93,750,000

	Senior Secured Notes

		Percentages of
		Notes Required
Mandatory Redemption Date		to be Redeemed
October 15, 2007			20%
October 15, 2008			10%

F-18

---

 

	Senior Credit Facility

F-19

---

 

6.	Store Closure and Asset Impairments

7.	Commitments

	Lease Commitments

F-20

---

 

			Operating
			Lease				Sublease
			Obligations				Income
2006			$	16,903,668			$	1,182,208
2007				17,755,669				1,188,496
2008				16,789,323				1,015,110
2009				15,819,428				818,952
2010				15,492,741				405,734
Thereafter				63,877,650				1,008,961
	Total minimum lease payments		$	146,638,479
	Total minimum sublease rentals						$	5,619,461

	Employment Agreements

8.	Guarantees

F-21

---

 

9.	Accrued Expenses and Other Current Liabilities

			Fiscal Year				Fiscal Year
			Ended				Ended
			December 31,				January 1,
			2005				2005
Salaries and benefits			$	2,927,440			$	1,791,931
Interest				2,654,411				2,647,670
Allowance for returns reserve				671,742				1,326,394
Gift certificates				8,091,210				7,521,148
Taxes				2,704,282				3,169,661
Other				2,114,374				2,260,311
	Total		$	19,163,459			$	18,717,115

10.	Other Income and Expense

11.	Retirement and Profit Sharing Plans

F-22

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12.	Common Stock

	Golfsmith International Holdings, Inc.

	Golfsmith International, Inc.

	Dividends

	Capital Shares Reserved for Issuance

Stock options				2,850,000
Restricted stock units				755,935
Additional authorized common shares				14,799,468
	Total unissued authorized common shares			18,405,403

13.	Restricted Stock Units

F-23

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14.	Stock Option Plan

	Golfsmith International Holdings, Inc. 2002 Incentive Stock Plan

							Range of				Weighted Average
			Options				Exercise Prices				Exercise Price
Outstanding at December 28, 2002				—			$	—			$	—
	Granted			1,840,500			$	3.00			$	3.00
	Exercised			—			$	—			$	—
	Forfeited			(113,000	)		$	3.00			$	3.00
Outstanding at January 3, 2004				1,727,500			$	3.00			$	3.00
	Granted			741,500			$	3.85			$	3.85
	Exercised			—			$	—			$	—
	Forfeited			(243,000	)		$	3.00–3.85			$	3.05
Outstanding at January 1, 2005				2,226,000			$	3.00–3.85			$	3.28
	Granted			69,223			$	3.85			$	3.85
	Exercised			—			$	—			$	—
	Forfeited			(287,000	)		$	3.00–3.85			$	3.69
Outstanding at December 31, 2005				2,008,223			$	3.00–3.85			$	3.24

F-24

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	Fair Value Disclosures

		Fiscal Year				Fiscal Year				Fiscal Year
		Ended				Ended				Ended
		December 31,				January 1,				January 3,
		2005				2005				2004
Risk-free interest rate			4.5	%			4.0	%			4.0	%
Weighted-average expected life of the options (years)			7.00				7.00				7.00
Dividend rate			0.0	%			0.0	%			0.0	%
Weighted-average fair value of options granted:
Exercise price equal to fair value of stock on date of grant		$	0.94			$	0.94			$	0.73

15.	Earnings Per Share

F-25

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							Year Ended
			December 31,				January 1,				January 3,
			2005				2005				2004
Net Income (loss)			$	2,957,634			$	(4,755,616	)		$	1,064,264
Basic:
	Weighted-average shares of common stock outstanding			21,594,597				21,594,597				20,768,021
	Weighted-average shares of restricted common stock units outstanding			755,935				755,935				755,935
	Shares used in computing basic net income (loss) per share			22,350,532				22,350,532				21,523,956
Effect of dilutive securities:
	Stock options and awards			318,253				—				—
	Shares used in computing diluted net income (loss) per share			22,668,785				22,350,532				21,523,956
Basic and diluted net income (loss) per share			$	0.13			$	(0.21	)		$	0.05

16.	Income Taxes

			Fiscal Year				Fiscal Year				Fiscal Year
			Ended				Ended				Ended
			December 31,				January 1,				January 3,
			2005				2005				2004
Current:
	Federal		$	64,943			$	—			$	—
	State			150,000				120,650				60,000
	Foreign			185,060				139,978				404,983
Total Current				400,003				260,628				464,983
Deferred:
	Federal			—				3,824,628				165,378
	State			—				337,468				14,592
	Foreign			—				—				—
Total deferred				—				4,162,096				179,970
Income tax provision			$	400,003			$	4,422,724			$	644,953

F-26

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		Fiscal Year				Fiscal Year				Fiscal Year
		Ended				Ended				Ended
		December 31,				January 1,				January 3,
		2005				2005				2004
Income Tax at U.S. statutory rate			34.0	%			(34.0	)%			34.0	%
State taxes, net of federal income tax			4.4	%			23.9	%			3.3	%
Foreign income taxes			5.2	%			42.0	%			0.0	%
Permanent differences and other			(4.1	)%			2.4	%			0.4	%
Utilized net operating losses			(34.5	)%			0.0	%			0.0	%
Change in valuation allowance			6.9	%			1,294.2	%			0.0	%
Income tax provision			11.9	%			1,328.5	%			37.7	%

			At December 31,				At January 1,
			2005				2005
Deferred tax assets:
	Accrued expenses and other		$	548,087			$	515,906
	Inventory basis			1,613,068				1,078,311
	Federal tax carryforwards			2,683,497				2,808,398
	Reserves and allowances			352,425				603,733
Total deferred tax assets				5,197,077				5,006,348
	Valuation allowance for deferred tax assets			4,540,198				4,308,362
Net deferred tax assets				656,879				697,986
Deferred tax liabilities:
	Depreciable/amortizable assets			656,879				697,986
Total deferred tax liabilities				656,879				697,986
Net deferred tax assets			$	—			$	—

F-27

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17.	Foreign and Domestic Operations

			Fiscal Year				Fiscal Year				Fiscal Year
			Ended				Ended				Ended
			December 31,				January 1,				January 3,
			2005				2005				2004
Net revenues:
	North America		$	318,888,015			$	289,619,500			$	251,910,857
	International			4,906,210				6,582,649				5,833,923
Operating profit:
	North America			14,124,426				9,431,519				11,231,351
	International			550,670				249,940				1,430,445
Income (loss) from continuing operations before income taxes:
	North America			2,891,252				(639,654	)			288,070
	International			466,385				306,762				1,421,147
Identifiable assets:
	North America			203,176,199				184,458,674				175,146,048
	International			1,660,071				2,470,625				2,303,100

18.	Valuation and Qualifying Accounts

							Amounts
							Charged to
			Balance at				Net Income				Write-offs				Balance at
			Beginning				(Loss), Net				Against				End of
			of Period				of Recoveries				Reserves				Period
Allowance for sales returns:
	Fiscal year ended December 31, 2005			1,326,394				10,180,021				(10,834,673	)			671,742
	Fiscal year ended January 1, 2005			1,357,173				10,358,365				(10,389,144	)			1,326,394
	Fiscal year ended January 3, 2004			1,098,029				8,111,425				(7,852,281	)			1,357,173
Allowance for doubtful accounts:
	Fiscal year ended December 31, 2005			161,838				65,670				(80,544	)			146,964
	Fiscal year ended January 1, 2005			176,667				85,487				(100,316	)			161,838
	Fiscal year ended January 3, 2004			242,643				157,717				(223,693	)			176,667

F-28

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19.	Consolidated Quarterly Financial Information (Unaudited)

		First				Second				Third				Fourth				Full
Fiscal 2005		Quarter				Quarter				Quarter				Quarter				Year
Net revenues		$	63,958,382			$	102,493,511			$	85,521,081			$	71,821,251			$	323,794,225
Gross profit			22,762,892				37,832,621				29,882,762				25,271,664				115,749,939
Income (loss) from continuing operations			(1,999,612	)			6,001,687				1,210,595				(2,255,036	)			2,957,634
Net income (loss)			(1,999,612	)			6,001,687				1,210,595				(2,255,036	)			2,957,634
Basic and diluted net income (loss) per share of common stock		$	(0.09	)		$	0.27			$	0.05			$	(0.10	)		$	0.13
Basic weighted average common shares outstanding			22,350,532				22,350,532				22,350,532				22,350,532				22,350,532
Diluted weighted average common shares outstanding			22,350,532				22,676,954				22,669,668				22,350,532				22,668,785

		First				Second				Third				Fourth				Full
Fiscal 2004		Quarter				Quarter				Quarter				Quarter				Year
Net revenues		$	65,782,039			$	96,943,734			$	73,895,536			$	59,580,840			$	296,202,149
Gross profit			22,975,182				33,374,179				24,516,783				20,321,426				101,187,570
Income (loss) from continuing operations			(202,961	)			2,265,194				535,655				(7,353,504	)			(4,755,616	)
Net income (loss)			(202,961	)			2,265,194				535,655				(7,353,504	)			(4,755,616	)
Basic and diluted net income (loss) per share of common stock		$	(0.01	)		$	0.10			$	0.02			$	(0.33	)		$	(0.21	)
Basic weighted average common shares outstanding			22,350,532				22,350,532				22,350,532				22,350,532				22,350,532
Diluted weighted average common shares outstanding			22,350,532				22,422,608				22,698,038				22,350,532				22,350,532

20.	Related Party Transactions

F-29

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	•	in the case of a transaction involving less than $50 million in total enterprise value, 2% of such total enterprise value;
	•	in the case of a transaction involving more than $50 million but less than $100 million in total enterprise value, $1 million; and
	•	in the case of a transaction involving more than $100 million in total enterprise value, 1% of such total enterprise value.

21.	Subsequent Events

F-30

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Item 13.	Other Expenses of Issuance and Distribution.

			Amount to
			be Paid
SEC registration fee			$
NASD filing fee
Nasdaq National Market fee
Blue sky qualification fees and expenses
Printing and engraving expenses
Legal fees and expenses
Accounting fees and expenses
Transfer agent and registrar fees
Miscellaneous fees and expenses
	Total		$

Item 14.	Indemnification of Officers and Directors.

Item 15.	Recent Sales of Unregistered Securities.

	•	On May 28, 2003, pursuant to the exemption from registration provided by Section 4(2) under the Securities Act of 1933, the Registrant issued 83,333 shares of its common stock to Thomas G. Hardy, one of its directors, for an aggregate purchase price of $249,999, or $3.00 per share.
	•	On June 16, 2003, pursuant to the exemption from registration provided by Section 4(2) under the Securities Act of 1933, the Registrant issued options to purchase an aggregate of

II-1

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		1,840,500 shares of its common stock at an exercise price of $3.00 per share to members of its management under its 2002 Incentive Stock Plan.

	•	On July 24, 2003, pursuant to the exemption from registration provided by Section 4(2) under the Securities Act of 1933, the Registrant issued 1,427,623 shares of its common stock to Atlantic Equity Partners III, L.P., its majority stockholder, for an aggregate purchase price of $4,282,869, or $3.00 per share. Holdings issued these shares without registration under the Securities Act in reliance on the exemption provided by Section 4(2) of the Securities Act as a transaction by an issuer not involving a public offering.
	•	On July 24, 2003, pursuant to the exemption from registration provided by Section 4(2) under the Securities Act of 1933, the Registrant issued 5,710 shares of its common stock to Thomas G. Hardy, one of its directors, for an aggregate purchase price of $17,131, or $3.00 per share.

Item 16.	Exhibits and Financial Statement Schedules.

Exhibit
Number				Description of Documents
	1	.1		Form of Underwriting Agreement*
	2	.1		Agreement and Plan of Merger, dated as of September 23, 2002, among Golfsmith International, Inc., Golfsmith International Holdings, Inc. and BGA Acquisition Corporation (filed as Exhibit 2.1 to Golfsmith’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	3	.1		Certificate of Incorporation of Golfsmith International, Inc. (filed as Exhibit 3.1 to Golfsmith International Holding, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	3	.2		Amended and Restated Certificate of Incorporation of Golfsmith International Holdings, Inc. to be effective upon the closing of this offering*
	3	.3		Bylaws of Golfsmith International, Inc. (filed as Exhibit 3.2 to Golfsmith’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	3	.4		Amended and Restated Bylaws of Golfsmith International Holdings, Inc. to be effective upon the closing of this offering*
	4	.1		Specimen Common Stock Certificate*
	4	.2		Indenture, dated as of October 15, 2002, among Golfsmith International, Inc., the guarantors named and defined therein and U.S. Bank Trust National Association, as trustee (filed as Exhibit 4.1 to Golfsmith International Holding, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	4	.3		First Supplemental Indenture, dated as of September 15, 2004, among Golfsmith International, Inc., the guarantors named and defined therein and U.S. Bank Trust National Association, as trustee (filed as Exhibit 4.2 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K (No. 333-101117) filed on September 17, 2004, and incorporated herein by reference)
	4	.4		Second Supplemental Indenture, dated as of March 21, 2005, among Golfsmith International, Inc., the guarantors named and defined therein and U.S. Bank Trust National Association, as trustee. (filed as Exhibit 4.3 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K (No. 333-101117) filed on March 24, 2005, and incorporated herein by reference)
	5	.1		Opinion of White & Case LLP*

II-2

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Exhibit
Number				Description of Documents
	9	.1		Stockholders Agreement, dated as of October 15, 2002, among Golfsmith International Holdings, Inc., Atlantic Equity Partners III, L.P. and the other stockholders party thereto (filed as Exhibit 9.1 to Golfsmith International Holding, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.1		Redemption Agreement, dated as of September 23, 2002, among DLJ Investment Partners, L.P., DLJ Investment Fundings, Inc., DLJ ESC II L.P., Golfsmith International, Inc., Golfsmith Holdings, L.P., Golfsmith GP Holdings, Inc., Golfsmith International Holdings, Inc. and BGA Acquisition Corporation (filed as Exhibit 10.1 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.2		Management Consulting Agreement, dated as of October 15, 2002, among Golfsmith International Holdings, Inc., Golfsmith International, Inc. and First Atlantic Capital, Ltd. (filed as Exhibit 10.4 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.3		Credit Agreement, dated as of October 15, 2002, among Golfsmith International, L.P., Golfsmith NU, L.L.C., and Golfsmith USA, L.L.C., as borrowers, Golfsmith International, Inc. and the other credit parties named therein and General Electric Capital Corporation, as a lender, as the initial L/C issuer and as agent (filed as Exhibit 10.5 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.4		Amendment No. 1 to the Credit Agreement, dated as of January 10, 2003, among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C. as Borrowers and General Electric Capital Corporation as a lender (filed as Exhibit 10.6 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.5		Amendment No. 2 to the Credit Agreement, dated as of September 5, 2003, among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C. as Borrowers and General Electric Capital Corporation as a lender (filed as Exhibit 10.7 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.6		Amendment No. 3 to the Credit Agreement, dated as of February 10, 2004, among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C. as Borrowers and General Electric Capital Corporation as a lender (filed as Exhibit 10.8 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004, (No. 333-101117) and incorporated herein by reference)
	10	.7		Amendment No. 4 to the Credit Agreement, dated as of March 11, 2004, among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C. as Borrowers and General Electric Capital Corporation as a lender (filed as Exhibit 10.9 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004, (No. 333-101117) and incorporated herein by reference)
	10	.8		Amendment No. 5 to Credit Agreement, dated as of July 21, 2004, by and among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C., as Borrowers, the other Persons designated as Credit Parties to the Credit Agreement, the lenders signatory thereto from time to time, and General Electric Capital Corporation, for itself and as a Lender, as L/C Issuer and as Agent for the Lenders (filed as Exhibit 10.1 to Golfsmith International Holdings, Inc.’s Quarterly Report on Form 10-Q for the quarter ended July 3, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.9		Amendment No. 6 to Credit Agreement, dated as of October 4, 2004, by and among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C., as Borrowers, the other Persons designated as Credit Parties to the Credit Agreement, the lenders signatory thereto from time to time, and General Electric Capital Corporation, for itself and as a Lender, as L/C Issuer and as Agent for the Lenders (filed as Exhibit 10.7 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K filed on October 8, 2004 (No. 333-101117) and incorporated herein by reference)

II-3

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Exhibit
Number				Description of Documents
	10	.10		Amendment No. 7 to Credit Agreement, dated as of November 5, 2004, by and among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C., as Borrowers, the other Persons designated as Credit Parties to the Credit Agreement, the lenders signatory thereto from time to time, and General Electric Capital Corporation, for itself and as a Lender, as L/C Issuer and as Agent for the Lenders (filed as Exhibit 10.8 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K filed on November 12, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.11		Amendment No. 8 to Credit Agreement, dated as of March 29, 2005, by and among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C., as Borrowers, the other Persons designated as Credit Parties to the Credit Agreement, the lenders signatory thereto from time to time, and General Electric Capital Corporation, for itself and as a Lender, as L/C Issuer and as Agent for the Lenders (filed as Exhibit 10.29 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 1, 2005, (No. 333-101117) and incorporated herein by reference)
	10	.12		Indemnification Agreement, dated as of October 15, 2002, among Golfsmith International Holdings, Inc., and Carl F. Paul and Franklin C. Paul, as stockholder representatives (filed as Exhibit 10.3 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.13		Indemnification Agreement, dated as of October 15, 2002, by Golfsmith International, Inc. in favor of Carl F. Paul (filed as Exhibit 10.7 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.14		Indemnification Agreement, dated as of October 15, 2002, by Golfsmith International, Inc. in favor of Franklin Paul (filed as Exhibit 10.8 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.15		Indemnification Agreement, dated as of October 15, 2002, by Golfsmith International, Inc. in favor of Barbara Paul (filed as Exhibit 10.9 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.16		Indemnification Agreement, dated as of October 15, 2002, by Golfsmith International, Inc. in favor of Kelly Redding (filed as Exhibit 10.10 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.17		Indemnification Agreement, dated as of October 15, 2002, by Golfsmith International, Inc. in favor of John Moriarty (filed as Exhibit 10.11 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.18		Employment Agreement, dated as of October 15, 2002, between Golfsmith International, Inc. and Carl F. Paul (filed as Exhibit 10.12 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.19		Letter Agreement amending the Carl F. Paul Employment Agreement, dated as of March 29, 2005, by and between Golfsmith International, Inc. and Carl F. Paul (filed as Exhibit 10.31 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 1, 2005 (No. 333-101117) and incorporated herein by reference)
	10	.20		Employment Agreement, dated as of October 15, 2002, between Golfsmith International, Inc. and Franklin C. Paul (filed as Exhibit 10.13 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.21		Letter Agreement amending the Franklin C. Paul Employment Agreement, dated as of March 29, 2005, by and between Golfsmith International, Inc. and Franklin C. Paul (filed as Exhibit 10.30 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 1, 2005 (No. 333-101117) and incorporated herein by reference)
	10	.22		Employment Agreement, dated as of October 15, 2002, between Golfsmith International, Inc. and James D. Thompson (filed as Exhibit 10.14 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)

II-4

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Exhibit
Number				Description of Documents
	10	.23		Employment Agreement, dated as of January 15, 2003, between Golfsmith International, Inc. and Virginia Bunte (filed as Exhibit 10.15 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.24		Consulting Agreement, dated as of June 9, 2005, between Mr. Larry Mondry and Golfsmith International Holdings, Inc. (filed as Exhibit 10.1 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K (No. 333-101117) filed on June 14, 2005, and incorporated herein by reference)
	10	.25		Settlement Agreement and General Release, dated as of September 30, 2004, between James C. Loden and Golfsmith International, L.P. (filed as Exhibit 10.1 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K filed on October 8, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.26		2002 Incentive Stock Plan (filed as Exhibit 10.18 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.27		2006 Incentive Stock Plan*
	10	.28		Golfsmith International Holdings, Inc. Annual Management Incentive Plan (filed as Exhibit 10.1 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K (No. 333-101117) filed on August 30, 2005, and incorporated herein by reference)
	10	.29		Form Individual Notice of Award (filed as Exhibit 10.2 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K (No. 333-101117) filed on August 30, 2005, and incorporated herein by reference)
	10	.30		Golfsmith International, Inc. Severance Benefit Plan (filed as Exhibit 10.17 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.31		Golfsmith 2004 Management Incentive Plan (filed as Exhibit 10.23 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-1 (No. 333-117210) and incorporated herein by reference)
	10	.32		Golfsmith International Holdings, Inc. Severance Pay Plan (filed as Exhibit 10.2 to Golfsmith International Holdings, Inc.’s Quarterly Report on Form 10-Q for the quarter ended July 3, 2004, (No. 333-101117) and incorporated herein by reference)
	21	.1		Subsidiaries of Golfsmith International Holdings, Inc. (filed as Exhibit 21.1 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004 (No. 333-10117) and incorporated herein by reference)
	23	.1		Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.
	23	.2		Consent of White & Case LLP (included in Exhibit 5.1)*
	24	.1		Power of Attorney (included in signature page)

*	To be filed by amendment.

Item 17.	Undertakings.

II-5

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	(1) To provide to the underwriter, at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.
	(2) That for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4), or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
	(3) That for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and this offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-6

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	GOLFSMITH INTERNATIONAL HOLDINGS, INC.

	By:	/s/ James D. Thompson

	James D. Thompson
	Chief Executive Officer, President and Director

Name				Title		Date
/s/ Charles Shaw Charles Shaw				Chairman of the Board of Directors		March 14, 2006
/s/ James D. Thompson James D. Thompson				Chief Executive Officer, President and Director (Principal Executive Officer)		March 14, 2006
/s/ Virginia Bunte Virginia Bunte				Senior Vice President, Chief Financial Officer and Treasurer (Principal Accounting and Financial Officer)		March 14, 2006
/s/ Roberto Buaron Roberto Buaron				Director		March 14, 2006

II-7

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Name				Title		Date
/s/ James Grover James Grover				Director		March 14, 2006
/s/ Noel Wilens Noel Wilens				Director		March 14, 2006
/s/ Thomas G. Hardy Thomas G. Hardy				Director		March 14, 2006
/s/ James Long James Long				Director		March 14, 2006
/s/ Lawrence Mondry Lawrence Mondry				Director		March 14, 2006

II-8

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Exhibit
Number				Description of Documents
	1	.1		Form of Underwriting Agreement*
	2	.1		Agreement and Plan of Merger, dated as of September 23, 2002, among Golfsmith International, Inc., Golfsmith International Holdings, Inc. and BGA Acquisition Corporation (filed as Exhibit 2.1 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	3	.1		Certificate of Incorporation of Golfsmith International, Inc. (filed as Exhibit 3.1 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	3	.2		Amended and Restated Certificate of Incorporation of Golfsmith International Holdings, Inc. to be effective upon the closing of this offering*
	3	.3		Bylaws of Golfsmith International, Inc. (filed as Exhibit 3.2 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	3	.4		Amended and Restated Bylaws of Golfsmith International Holdings, Inc. to be effective upon the closing of this offering*
	4	.1		Specimen Common Stock Certificate*
	4	.2		Indenture, dated as of October 15, 2002, among Golfsmith International, Inc., the guarantors named and defined therein and U.S. Bank Trust National Association, as trustee (filed as Exhibit 4.1 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	4	.3		First Supplemental Indenture, dated as of September 15, 2004, among Golfsmith International, Inc., the guarantors named and defined therein and U.S. Bank Trust National Association, as trustee (filed as Exhibit 4.2 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K (No. 333-101117) filed on September 17, 2004, and incorporated herein by reference)
	4	.4		Second Supplemental Indenture, dated as of March 21, 2005, among Golfsmith International, Inc., the guarantors named and defined therein and U.S. Bank Trust National Association, as trustee. (filed as Exhibit 4.3 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K (No. 333-101117) filed on March 24, 2005, and incorporated herein by reference)
	5	.1		Opinion of White & Case LLP*
	9	.1		Stockholders Agreement, dated as of October 15, 2002, among Golfsmith International Holdings, Inc., Atlantic Equity Partners III, L.P. and the other stockholders party thereto (filed as Exhibit 9.1 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.1		Redemption Agreement, dated as of September 23, 2002, among DLJ Investment Partners, L.P., DLJ Investment Fundings, Inc., DLJ ESC II L.P., Golfsmith International, Inc., Golfsmith Holdings, L.P., Golfsmith GP Holdings, Inc., Golfsmith International Holdings, Inc. and BGA Acquisition Corporation (filed as Exhibit 10.1 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.2		Management Consulting Agreement, dated as of October 15, 2002, among Golfsmith International Holdings, Inc., Golfsmith International, Inc. and First Atlantic Capital, Ltd. (filed as Exhibit 10.4 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.3		Credit Agreement, dated as of October 15, 2002, among Golfsmith International, L.P., Golfsmith NU, L.L.C., and Golfsmith USA, L.L.C., as borrowers, Golfsmith International, Inc. and the other credit parties named therein and General Electric Capital Corporation, as a lender, as the initial L/C issuer and as agent (filed as Exhibit 10.5 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)

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Exhibit
Number				Description of Documents
	10	.4		Amendment No. 1 to the Credit Agreement, dated as of January 10, 2003, among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C. as Borrowers and General Electric Capital Corporation as a lender (filed as Exhibit 10.6 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.5		Amendment No. 2 to the Credit Agreement, dated as of September 5, 2003, among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C. as Borrowers and General Electric Capital Corporation as a lender (filed as Exhibit 10.7 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.6		Amendment No. 3 to the Credit Agreement, dated as of February 10, 2004, among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C. as Borrowers and General Electric Capital Corporation as a lender (filed as Exhibit 10.8 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.7		Amendment No. 4 to the Credit Agreement, dated as of March 11, 2004, among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C. as Borrowers and General Electric Capital Corporation as a lender (filed as Exhibit 10.9 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.8		Amendment No. 5 to Credit Agreement, dated as of July 21, 2004, by and among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C., as Borrowers, the other Persons designated as Credit Parties to the Credit Agreement, the lenders signatory thereto from time to time, and General Electric Capital Corporation, for itself and as a Lender, as L/C Issuer and as Agent for the Lenders (filed as Exhibit 10.1 to Golfsmith International Holdings, Inc.’s Quarterly Report on Form 10-Q for the quarter ended July 3, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.9		Amendment No. 6 to Credit Agreement, dated as of October 4, 2004, by and among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C., as Borrowers, the other Persons designated as Credit Parties to the Credit Agreement, the lenders signatory thereto from time to time, and General Electric Capital Corporation, for itself and as a Lender, as L/C Issuer and as Agent for the Lenders (filed as Exhibit 10.7 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K filed on October 8, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.10		Amendment No. 7 to Credit Agreement, dated as of November 5, 2004, by and among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C., as Borrowers, the other Persons designated as Credit Parties to the Credit Agreement, the lenders signatory thereto from time to time, and General Electric Capital Corporation, for itself and as a Lender, as L/C Issuer and as Agent for the Lenders (filed as Exhibit 10.8 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K filed on November 12, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.11		Amendment No. 8 to Credit Agreement, dated as of March 29, 2005, by and among Golfsmith International, L.P., Golfsmith NU, L.L.C. and Golfsmith USA, L.L.C., as Borrowers, the other Persons designated as Credit Parties to the Credit Agreement, the lenders signatory thereto from time to time, and General Electric Capital Corporation, for itself and as a Lender, as L/C Issuer and as Agent for the Lenders (filed as Exhibit 10.29 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 1, 2005, (No. 333-101117) and incorporated herein by reference)
	10	.12		Indemnification Agreement, dated as of October 15, 2002, among Golfsmith International Holdings, Inc., and Carl F. Paul and Franklin C. Paul, as stockholder representatives (filed as Exhibit 10.3 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)

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Exhibit
Number				Description of Documents
	10	.13		Indemnification Agreement, dated as of October 15, 2002, by Golfsmith International, Inc. in favor of Carl F. Paul (filed as Exhibit 10.7 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.14		Indemnification Agreement, dated as of October 15, 2002, by Golfsmith International, Inc. in favor of Franklin Paul (filed as Exhibit 10.8 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.15		Indemnification Agreement, dated as of October 15, 2002, by Golfsmith International, Inc. in favor of Barbara Paul (filed as Exhibit 10.9 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.16		Indemnification Agreement, dated as of October 15, 2002, by Golfsmith International, Inc. in favor of Kelly Redding (filed as Exhibit 10.10 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.17		Indemnification Agreement, dated as of October 15, 2002, by Golfsmith International, Inc. in favor of John Moriarty (filed as Exhibit 10.11 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.18		Employment Agreement, dated as of October 15, 2002, between Golfsmith International, Inc. and Carl F. Paul (filed as Exhibit 10.12 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.19		Letter Agreement amending the Carl F. Paul Employment Agreement, dated as of March 29, 2005, by and between Golfsmith International, Inc. and Carl F. Paul (filed as Exhibit 10.31 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 1, 2005 (No. 333-101117) and incorporated herein by reference)
	10	.20		Employment Agreement, dated as of October 15, 2002, between Golfsmith International, Inc. and Franklin C. Paul (filed as Exhibit 10.13 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.21		Letter Agreement amending the Franklin C. Paul Employment Agreement, dated as of March 29, 2005, by and between Golfsmith International, Inc. and Franklin C. Paul (filed as Exhibit 10.30 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 1, 2005 (No. 333-101117) and incorporated herein by reference)
	10	.22		Employment Agreement, dated as of October 15, 2002, between Golfsmith International, Inc. and James D. Thompson (filed as Exhibit 10.14 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.23		Employment Agreement, dated as of January 15, 2003, between Golfsmith International, Inc. and Virginia Bunte (filed as Exhibit 10.15 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.24		Consulting Agreement, dated as of June 9, 2005, between Mr. Larry Mondry and Golfsmith International Holdings, Inc. (filed as Exhibit 10.1 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K (No. 333-101117) filed on June 14, 2005, and incorporated herein by reference)
	10	.25		Settlement Agreement and General Release, dated as of September 30, 2004, between James C. Loden and Golfsmith International, L.P. (filed as Exhibit 10.1 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K filed on October 8, 2004 (No. 333-101117) and incorporated herein by reference)
	10	.26		2002 Incentive Stock Plan (filed as Exhibit 10.18 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.27		2006 Incentive Stock Plan*
	10	.28		Golfsmith International Holdings, Inc. Annual Management Incentive Plan (filed as Exhibit 10.1 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K (No. 333-101117) filed on August 30, 2005, and incorporated herein by reference)

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Exhibit
Number				Description of Documents
	10	.29		Form Individual Notice of Award (filed as Exhibit 10.2 to Golfsmith International Holdings, Inc.’s Current Report on Form 8-K (No. 333-101117) filed on August 30, 2005, and incorporated herein by reference)
	10	.30		Golfsmith International, Inc. Severance Benefit Plan (filed as Exhibit 10.17 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-4 (No. 333-101117) and incorporated herein by reference)
	10	.31		Golfsmith 2004 Management Incentive Plan (filed as Exhibit 10.23 to Golfsmith International Holdings, Inc.’s Registration Statement on Form S-1 (No. 333-117210) and incorporated herein by reference)
	10	.32		Golfsmith International Holdings, Inc. Severance Pay Plan (filed as Exhibit 10.2 to Golfsmith International Holdings, Inc.’s Quarterly Report on Form 10-Q for the quarter ended July 3, 2004, (No. 333-101117) and incorporated herein by reference)
	21	.1		Subsidiaries of Golfsmith International Holdings, Inc. (filed as Exhibit 21.1 to Golfsmith International Holdings, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 3, 2004 (No. 333-10117) and incorporated herein by reference)
	23	.1		Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.
	23	.2		Consent of White & Case LLP (included in Exhibit 5.1)*
	24	.1		Power of Attorney (included in signature page)

*	To be filed by amendment.