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Form 10-Q Treasure & Shipwreck For: Jul 31

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September 13, 2019 2:45 PM EDT
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
  
Form 10-Q
  
☒ Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended July 31, 2019
 
☐ Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from __________ to __________
 
Commission file number 333-219700
 
 
Treasure & Shipwreck Recovery, Inc.
Formerly Beliss Corp.
 
 
(Exact name of registrant as specified in its charter)
 
 
 
 
Nevada
7310
37-1844836
(State or Other Jurisdiction of Incorporation or Organization)
(Primary Standard Industrial Classification Code Number)
(IRS Employer Identification No.)
 
Craig Huffman
Chief Executive Officer
13046 Racetrack Road, #234,
Tampa, FL 33626
(813) 504-7831

(Address and telephone number of registrant’s principal offices)
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
 
Large accelerated filer ☐
Large accelerated filer ☐
Non-accelerated filer ☐
Smaller reporting company ☒
Emerging growth company ☐

 
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes ☐ No ☒
 
State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: The Company has 5,035,000 common shares issued and outstanding as of September 13, 2019.
 
 
 
 
1
 
 
Treasure & Shipwreck Recovery, Inc.
QUARTERLY REPORT ON FORM 10-Q
Table of Contents
  
 
 
Page
PART I
FINANCIAL INFORMATION:
 
 
 
 
Item 1.
Financial Statements (Unaudited)
3
 
 
 
 
Balance Sheets as of July 31, 2019 (Unaudited) and April 30, 2019
4
 
Interim Unaudited Statements of Operations for the three months ended July 31, 2019 and 2018
5
 
Interim Unaudited Statement of Changes in Stockholders’ Equity for the three months ended July 31, 2019 and 2018
6
 
Interim Unaudited Statements of Cash Flows for the three months ended July 31, 2019 and 2018
7
 
Notes to the Interim Unaudited Financial Statements
8
 
 
 
Item 2.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
12
  
 
 
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
14
 
 
 
Item 4.
Controls and Procedures
14
 
 
 
PART II
OTHER INFORMATION:
 
 
 
 
Item 1.
Legal Proceedings
15
 
 
 
Item 1A
Risk Factors
15
 
 
 
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
15
  
  
 
Item 3.
Defaults Upon Senior Securities
15
  
  
 
Item 4.
Submission of Matters to a Vote of Securities Holders
15
 
 
 
Item 5.
Other Information
15
 
 
 
Item 6.
Exhibits
15
 
 
 
  
Signatures
15
 
 
  
 
 
 
 
2
 
 
PART 1 – FINANCIAL INFORMATION
  
Item 1. Financial Statements
 
The accompanying interim financial statements of Treasure & Shipwreck Recovery, Inc., formerly Beliss Corp. (“the Company”, “we”, “us” or “our”), have been prepared without audit pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with United States generally accepted principles have been condensed or omitted pursuant to such rules and regulations.
 
The interim financial statements are condensed and should be read in conjunction with the company’s latest annual financial statements. The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, since they are interim statements, the accompanying financial statements do not include all the information and notes required by GAAP for complete financial statement presentation.
 
In the opinion of management, the financial statements contain all material adjustments, consisting only of normal adjustments considered necessary to present fairly the financial condition, results of operations, and cash flows of the Company for the interim periods presented.
 
 
 
 
 
 
 
 
 
3
 
 
Treasure & Shipwreck Recovery, Inc.
CONDENSED BALANCE SHEETS
As of July 31, 2019 and April 30, 2019
 
ASSETS
 
July 31, 2019
(Unaudited)
 
 
April 30, 2019
 
  
 
 
 
 
 
 
Total Assets
 $- 
  - 
  
    
    
LIABILITIES AND STOCKHOLDERS’ EQUITY
    
    
Liabilities
    
    
Current Liabilities
    
    
   Accounts Payable
  1,899 
  1,899 
   Customer Deposits
  8,700 
  8,700 
   Short Term Loans
  16,763 
  16,763 
   Related Party Loans
  20,290 
  17,790 
Total Current Liabilities
 $47,652 
  45,152 
 
    
    
Total Liabilities
 $47,652 
  45,152 
 
    
    
Stockholder’s Equity
    
    
Common stock, par value $0.001; 75,000,000 shares authorized,5,035,000 and 5,035,000 shares issued and outstanding
  5,035 
  5,035 
Additional paid in capital
  38,665 
  38,665 
Accumulated deficit
  (91,352)
  (88,852)
Total Stockholders’ Equity
 $(47,652)
  (45,152)
 
    
    
Total Liabilities and Stockholders’ Equity
 $- 
  - 
 
 
See accompanying notes, which are an integral part of these unaudited financial statements
 
 
 
 
 
 
 
 
4
 
 
Treasure & Shipwreck Recovery, Inc.
CONDENSED STATEMENTS OF OPERATIONS
Three months ended July 31, 2019 and 2018
 
 
 
Three months ended
July 31,2019
(Unaudited)
 
 
Three months ended
July 31, 2018
(Unaudited)
 
 
 
 
 
 
 
 
REVENUES
 $- 
  14,150 
Gross Profit
  - 
  14,150 
 
    
    
OPERATING EXPENSES
    
    
General and Administrative Expenses
  2,500 
  15,196 
TOTAL OPERATING EXPENSES
  2,500 
  15,196 
 
    
    
NET LOSS FROM OPERATIONS
  (2,500)
  (1,046)
 
    
    
PROVISION FOR INCOME TAXES
  - 
  - 
 
    
    
NET LOSS
 $(2,500)
  (1,046)
 
    
    
NET LOSS PER SHARE: BASIC AND DILUTED
 $(0.00)
  (0.00)
 
    
    
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING: BASIC AND DILUTED
  5,035,000 
  5,035,000 
 
 
 
 
 
 
See accompanying notes, which are an integral part of these unaudited financial statements
 
5
 
 
Treasure & Shipwreck Recovery, Inc.
CONDENSED STATEMENTS OF CASH FLOWS
Three months ended July 31, 2019 and 2018
 
  
   
 
Common Stock
 
 
 
  Additional Paid-in Capital
 
 
Deficit Accumulated
 
 
Total Stockholders’
Equity
 
   
 
Shares
 
 
Amount
 
 
 
 
 
 
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance, April 30, 2018
  5,035,000 
 $5,035 
 $38,665 
 $(40,270)
 $3,430 
 
    
    
    
    
    
Net (loss) for the period ended July 31, 2018
  - 
  - 
  - 
  (1,046)
  (1,046)
 
    
    
    
    
    
Balance, July 31, 2018
  5,035,000 
 $5,035 
 $38,665 
 $(41,316)
 $2,384 
 
    
    
    
    
    
 
 
 
Common Stock
 
 
Additional Paid-in Capital
 
 
Deficit Accumulated
 
 
Total Stockholders’ Equity
 
 
 
Shares
 
 
Amount
 
 
 
 
 
 
 
 
 
 
   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance, April 30, 2019
  5,035,000 
 $5,035 
 $38,665 
 $(88,852)
 $(45,152)
 
    
    
    
    
    
Net (loss) for the period ended    July 31, 2019
  - 
  - 
  - 
 (2,500)
  (2,500)
 
    
    
    
    
    
Balance, July 31, 2019
  5,035,000 
 $5,035 
 $38,665 
 $(91,352)
 $(47,652)
   
   
   See accompanying notes, which are an integral part of these unaudited financial statements
 
6
 
 
Treasure & Shipwreck Recovery, Inc.
CONDENSED STATEMENTS OF CASH FLOWS
Three months ended July 31, 2019 and 2018
  
 
 
 
Three months ended
July 31, 2019
(Unaudited)
 
 
Three months ended
July 31, 2018
(Unaudited)
 
CASH FLOWS FROM OPERATING ACTIVITIES
 
 
 
 
 
 
Net loss
 $(2,500)
 $(1,046)
 
    
    
Adjustments to reconcile net loss to net cash used in operating activities:
    
    
Depreciation
  - 
  1,189 
Changes in operating assets and liabilities:
  - 
    
Changes in Prepaid Expenses
  - 
  570 
Changes in Customer Deposits
  - 
  (7,000)
Related Party Loans
  2,500 
  - 
CASH FLOWS USED IN OPERATING ACTIVITIES
  - 
  (6,287)
 
    
    
NET DECREASE IN CASH
  - 
  (6,287)
 
    
    
Cash, beginning of period
  - 
  7,257 
 
    
    
Cash, end of period
 $- 
 $970 
 
    
    
SUPPLEMENTAL CASH FLOW INFORMATION:
    
    
Interest paid
 $- 
 $- 
Income taxes paid
 $- 
 $- 
 
 
 
See accompanying notes, which are an integral part of these unaudited financial statements
 
 
 
7
 
 
Treasure & Shipwreck Recovery, Inc.
NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS
July 31, 2019
 
Note 1 – ORGANIZATION AND NATURE OF BUSINESS
 
Treasure & Shipwreck Recovery Corp. (“the Company”, “we”, “us” or “our”) was incorporated in the State of Nevada on October 24, 2016 as Beliss Corp. The Company changed its name to Treasure & Shipwreck Recovery Corp. on June 26, 2019. The Company’s primary business strategy is to focus on opportunities in the sunken treasure industry. The Company was originally focused on the development of high impact internet marketing, search engine optimization (“SEO”) software and techniques, and the development of digital properties (colletively “Internet Marketing”).
 
Although the Company has shifted its focus to the sunken treasure industry it will retain its Internet Marketing business in order to fulfill any obligations to previous customers who made deposits or in the event that any substantial new opportunities should arise, which Management views as unlikely. Moreover, the Company does not anticipate generating any significant revenues from the Internet Marketing business for the foreseeable future.
 
Our general business strategy is to be actively engaged in the sunken treasure industry, researching, surveying, finding and recovering artifacts, treasure or other items of value from valuable historical shipwrecks from the 15th century to the present day. We have taken on certain persons, in particular Dr. E. Lee Spence, who are experts in the necessary fields of treasure finds. We also intend to secure the rights for treasure salvage through courts and other means. Furthermore, we will contract with outside service providers to conduct salvage operations. Any recovered finds by the Company are going to be split with Dr. E. Lee Spence who is a foremost treasure expert and has taken on the role of Chief Operating Officer as well as Chairman of the Board. 
 
Note 2 – GOING CONCERN
 
The accompanying financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate continuation of the Company as a going concern. For the quarter ended July 31, 2019 the Company had not generated any revenues. The Company currently has losses and has not completed its efforts to establish a stabilized source of revenues sufficient to cover operating costs over an extended period of time. Based on its historical rate of expenditures, the Company expects to expend its available cash in less than one month from September 14, 2019. Therefore, there is substantial doubt about the Company’s ability to continue as a going concern for one year after the date the financial statements are issued. Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses The Company intends to position itself so that it will be able to raise additional funds through the capital markets. Despite management’s ongoing efforts, there are no assurances that the Company will be successful in this or any of its endeavors or become financially viable and continue as a going concern.
 
Note 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
Basis of Presentation
 
Management acknowledges its responsibility for the preparation of the accompanying interim financial statements which reflect all adjustments, consisting of normal recurring adjustments, considered necessary in its opinion for a fair statement of its financial position and the results of its operations for the interim period presented. These financial statements should be read in conjunction with the summary of significant accounting policies and notes to consolidated financial statements included in the Company’s Form 10-K annual report for the year ended April 30, 2019. The balance sheet as of July 31, 2019 has been derived from the audited financial statements. The results of the three months ended July, 2019 are not necessarily indicative of the results to be expected for the full fiscal year ending April 30, 2020.
 
Use of Estimates
 
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
 
Cash and Cash Equivalents
 
The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. The Company had $0 of cash as of July 31, 2019 and $0 as of April 30, 2019.
 
 
8
 
 
Treasure & Shipwreck Recovery, Inc.
NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS
July 31, 2019
   
Customer Deposits
 
Customer Deposits discloses an amount paid by a customer to a company prior to the company providing it with goods or services. The company receiving the money has an obligation to provide the goods or services to the customer or to return the money. The Company had $8,700 in customer deposits as of July 31, 2019 and April 30, 2019.
 
Depreciation, Amortization, and Capitalization
 
The Company records depreciation and amortization when appropriate using straight-line balance method over the estimated useful life of the assets. We estimate that the useful life of furniture is 5 years. Expenditures for maintenance and repairs are charged to expense as incurred. Additions, major renewals and replacements that increase the property's useful life are capitalized. Property sold or retired, together with the related accumulated depreciation is removed from the appropriated accounts and the resultant gain or loss is included in net income. We incurred $0 and $1,189 of depreciation expense during the three months ended July 31, 2019 and 2018.
 
Fair Value of Financial Instruments
 
As topic 820 "Fair Value Measurements and Disclosures" establishes a three-tier fair value hierarchy, which prioritizes the inputs in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market.
 
These tiers include:
Level 1:
defined as observable inputs such as quoted prices in active markets;
Level 2:
defined as inputs other than quoted prices in active markets that are either directly or indirectly observable;
Level 3:
defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
 
The carrying value of cash and the Company’s loan from shareholder approximates its fair value due to their short-term maturity.
 
Income Taxes
 
Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.
 
Revenue Recognition
 
Effective May 1, 2018, the Company adopted the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts. The implementation of ASC 606 did not have a material impact on the Company’s financial statements as the Company, previously recognized revenue when the performance obligation for customers had been satisfied. The core principle of ASC 606 is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. An entity recognizes revenue in accordance with that core principle by applying the following steps: Step 1: Identify the contract(s) with a customer Step 2: Identify the performance obligations in the contract Step 3: Determine the transaction price Step 4: Allocate the transaction price to the performance obligations in the contract Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation. Specifically, Section 606-10-50 requires an entity to provide information about: a. Revenue recognized from contracts with customers, including the disaggregation of revenue into appropriate categories; b. Contract balances, including the opening and closing balances of receivables, contract assets, and contract liabilities; c. Performance obligations, including when the entity typically satisfies its performance obligations and the transaction price that is allocated to the remaining performance obligations in a contract; d. Significant judgments, and changes in judgments, made in applying the requirements to those contracts. The Company’s revenue consists of revenue from providing high impact internet marketing to internet based businesses and small businesses seeking to create websites and provide better search engine optimization (“SEO”) software and techniques to small internet based businesses and people seeking to create websites.
 
The new revenue recognition standard won’t have impact on the company since the company has not generated any revenues in three month July 31, 2019.
 
 
9
 
 
Treasure & Shipwreck Recovery, Inc.
NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS
July 31, 2019
  
For our service contracts, our services provided are considered to be one single performance obligation. Revenue and expenses are recognized as services are rendered. As of January 31, 2019 the Company has six contracts. The average period for satisfying the performance obligation is three months. We have analyzed all of our contracts and can confirm that all the requirements are considered in these contracts:
 
1) The contracts with customers were identified;
2) The performance obligation was the creation of a website and the provision of SEO-optimization and other services for this site;
3) The transaction price was determined in paragraph 1.3;
4) The Company has only one performance obligation, so the whole transaction price is related to this performance obligation;
5) The revenue was recognized when the performance obligation had been satisfied.
 
The Company offers no discounts, rebates, rights of return, or other allowances to clients which would result in the establishment of reserves against service revenue. Additionally, to date, the Company has not incurred incremental costs in obtaining a client contract.
 
Basic Loss per Share
 
The Company computes loss per share in accordance with FASB ASC 260 “Earnings per Share”. Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted loss per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive. As of July 31, 2019 and 2018 there were no potentially dilutive debt or equity instruments issued or outstanding.
 
Recent Accounting Pronouncements
 
We have reviewed the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company.
 
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which issued new guidance related to leases that outlines a comprehensive lease accounting model and supersedes the current lease guidance. The new guidance requires lessees to recognize lease liabilities and corresponding right-of-use assets for all leases with lease terms of greater than 12 months. It also changes the definition of a lease and expands the disclosure requirements of lease arrangements. The new guidance must be adopted using the modified retrospective approach and will be effective for the Company in the fiscal year beginning October 1, 2019. Early adoption is permitted. The Company has reviewed this guidance and believes it has no impact on its financial statements and related disclosures.
  
Note 4 – FIXED ASSETS
  
As of July 31, 2019 and April 30, 2019, our fixed asset balance was $0. The Company determined that it would not be cost effective to move its furniture and office equipment from India to the United States so the Company wrote down its previous fixed asset balance of $17,720 to $0 at April 30, 2019.
 
Note 5 – LOANS
 
Loan from Officer
 
As of July 31, 2019 Craig Huffman, an officer and director, provided loans to the Company of $20,290 under a convertible promissory note. This convertible promissory note is unsecured, non-interest bearing, and is convertible into common shares of the Company stock at $2.75 per share and due on demand. The balance due to Mr. Huffman was $20,290 as of July 31, 2019, and $17,790 as of April 30, 2019.
 
Short Term Loans
 
As of July 31, 2019, the Company had loans totaling $16,763 with two non-related parties, a loan in the amount of $14,063 and a loan in the amount of $2,700. These loans are unsecured, non-interest bearing and due on demand.
 
Note 6 – COMMON STOCK
 
The Company has 75,000,000, $0.001 par value shares of common stock authorized.
 
In April 2017, the Company issued 3,000,000 shares of common stock to a director for cash proceeds of $3,000 at $0.001 per share.
 
 
10
 
 
Treasure & Shipwreck Recovery, Inc.
NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS
July 31, 2019
  
In December 2017 the Company issued 750,000 shares for cash proceeds of $15,000 at $0.02 per share.
 
In January 2018 the Company issued 1,135,000 shares for cash proceeds of $22,700 at $0.02 per share.
 
In February 2018 the Company issued 150,000 shares for cash proceeds of $3,000 at $0.02 per share.
 
There were 5,035,000 shares of common stock issued and outstanding as of July 31, 2019 and 5,035,000 shares as of April 30, 2019.
  
The Company is in the process of cancelling the shares issued to J.D. Brammer and Vicki Ferrel from the cancelled Southern Amusement transaction. All such shares are held in escrow for cancellation under our Counsel and CEO.
 
Other Stock Issuances
 
The company does not have any other classes of stock issued or outstanding as of July 31, 2019 and 2018. The Company does not have any warrants or options as of July 31, 2019 and 2018.
 
Note 7 – COMMITMENTS AND CONTINGENCIES
 
The Company had no commitment and contingencies for the periods ending July 31, 2019 and April 30, 2019.
 
Note 8 – SUBSEQUENT EVENTS
 
In August of 2019 the Company created a wholly owned subsidiary, TSR Holdings, Inc. TSR Holdings, Inc. then purchased a 71 foot vessel, the R/V Bellows, from The Board of Trustees of the University of South Florida. The vessel was delivered to the Company at the Florida Institute of Oceanography in St. Petersburg Florida on August 29, 2019. With the purchase of the R/V Bellows the Company now has the full operational capability to execute its business plan.

 
 
 
 
 
 
 
 
 
 
11
 
 
ITEM 2. MANAGEMENT’ DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 
Forward-looking statements
 
Statements made in this Form 10-K that are not historical or current facts are "forward-looking statements" made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange Act of 1934. These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.
 
Financial information contained in this report and in our financial statements is stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.
 
Description of the Business
 
We were incorporated in the State of Nevada on October 24th, 2016. The Company was incorporated as Beliss Corp. however on June 26, 2019 the Company changed its name to Treasure & Shipwreck, Inc. by which we will refer as “TSR,” Our original general business plan was originally in the search engine optimization (“SEO”), Internet marketing and web development business. Subsequent to April 30, 2019 the Company elected to focus its business plan on entering the treasure recovery business by attempting to work with, partner with or hire experts in that industry. Mr. Huffman possesses over 10 years of experience working with treasure companies, including their budgeting, due diligence, research issues, and gaining rights to suspected or known wreck sites using United States Admiralty law in United States Courts. As such, Huffman knew many of the experts and opportunities in the treasure industry and had a business plan for such operations to be implemented in the Company.
 
In January 2019, the Company entered into a series of transactions to gain control of a company named Southern Amusement Co. Inc. (“Southern Amusement”) a West Virginia based business. With that acquisition TSR was to acquire Southern Amusement as a wholly owned subsidiary company.
 
Southern Amusement is an amusement machine provider located in Logan, West Virginia. The company had some 525 West Virginia Limited Video Lottery machines licensed under West Virginia law. The agreements called for delivery of all shares of Southern Amusement owned by John (J.D.) Brammer to be delivered in the transaction and be held by TSR A private agreement was entered by Ajay Rajendron for delivery of 2,700,000 shares of Beliss stock which he held of his 3,000,000 shares to JD. Brammer as part of the transaction became the CEO and sole director while Rajanedron resigned. Subsequently as set forth in the subsequent events, Brammer resigned and Craig A. Huffman was appointed when the Southern Amusement transaction did not occur.
 
Importantly, under West Virginia law and regulation, control of any lottery related company, including ownership must be majority owned by a licensed and certified person by the Lottery Commission who must be a West Virginia resident. So in the transaction the control and majority control of Beliss as the owner of Southern, would have to be a West Virginia resident. Thus, the then Chief Operating Officer of Southern, John (J.D.) Brammer was appointed as CEO and director of Beliss, since he was licensed in Southern and was a West Virginia resident. After numerous legal consultations it was decided that due to the West Virginia laws, J.D. Brammer would have to be the majority holder of Beliss. Thus after he was appointed as CEO and director, and Ajay Rajendran resigned as CEO and director, additional shares in the amount of 5,500,000 shares we issued to J.D. Brammer under restrictions, that included such shares would be surrendered if the transaction was not approved by the West Virginia Lottery Commission or if the shares of Southern could not be completely delivered. In such instance all interest in such shares by J.D. Brammer would be surrendered, and such shares would go to an escrow agent for control until a future cancellation or other action occurred. One additional agreement was with Vicki Ferell, who was part owner of Southern Amusement, so the agreement with Ferell was for her to deliver her shares of Southern Amusement to Beliss, in exchange for 571,429 shares of common stock. Such shares were issued to Vicki Ferrell.
 
 
12
 
 
By April 2019, the shares of Southern Amusement were not delivered to Beliss after requests were made by counsel. It was then discovered that there was an undisclosed obligation on such shares which was not communicated to Beliss during the transaction. In exchange for a mutual release which Beliss believed such action was merely a mistake of fact, all such shares were abandoned by any interest by J.D. Brammer (the issued 5,500,000 shares), including the 2,700,000 private shares he had received from Ajay Rajendron which were also released to the control of the escrow agent and counsel for the Company. On April 28, 2019 Brammer resigned and the transaction was cancelled. At that point Craig A. Huffman (“Huffman”), counsel for the Company, became acting Chief Executive Officer (“CEO”) and sole Director of the Company. At the same time as the settlement agreement, Vicki Ferrell disclaimed any interest in the shares.
 
While in the process of unwinding the transaction with the shareholders of Southern Amusement, the Company began to review various business opportunities. Subsequent to April 30, 2019 the Company elected to focus its business plan on entering the treasure recovery business by attempting to work with, partner with or hire experts in that industry under the experience of the new acting Chief Executive Officer and sole Director Craig A. Huffman (“Huffman”). Huffman possesses over 10 years of experience working with treasure companies, including their budgeting, due diligence, research issues, and gaining rights to suspected or known wreck sites using United States Admiralty law in United States Courts. As such, Huffman knew many of the experts and opportunities in the treasure industry and had a business plan for such operations to be implemented in the Company. In that realm, he pursued which is explained in Note 8, subsequent events.
 
Legal Proceedings
 
The Company is not a party to any legal proceeding nor is it aware of any pending or threatened litigation against us.
 
Results of operations
 
We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.
 
We will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities. However, there can be no assurances that we will be able to raise additional capital. Based on its historical rate of expenditures, the Company expects to expend its available cash in less than one month from September 14, 2019
 
Liquidity and capital resources
 
As at July 31, 2019, our total assets were $0.
 
As at July 31, 2019, our current liabilities were $47,652 and Stockholders’ equity was negative $47,652. As of July 31, 2019 we had a working capital deficit of $47,652.
 
A significant financial challenge and risk facing the Company is a lack of liquidity. The Company continued to operate with a working capital deficit during the period ended July 31, 2019. This working capital deficit indicates that the Company is unable to meet its short-term liabilities with its current assets. This working capital deficit is extremely risky for the Company as it may be forced to cease its operations due to its inability to meet its current obligations.
 
Cash flows from operating activities
 
For the three months ended July 31, 2019 net cash flows used in operating activities was $0.
 
Cash flows from investing activities
 
For the three months ended July 31, 2019 we have used no cash in investing activities.
 
Cash flows from financing activities
 
For the three months ended July 31, 2019 we have generated $0 cash flows from financing activities.
.
We qualify as an “ smaller reporting  company” under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements.
 
For example, smaller reporting companies are not required to provide a compensation discussion and analysis under Item 402(b) of Regulation S-K or the auditor attestation of internal controls over financial reporting.
 
 
13
 
 
Future Financings
 
We will continue to rely on equity sales of the Company’s common shares in order to continue to fund business operations. Issuances of additional shares will result in dilution to existing shareholders. There is no assurance that the Company will achieve any additional sales of equity securities or arrange for debt or other financing to fund planned research and development of our web and mobile based products.
  
Recently Issued Accounting Pronouncements
 
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
 
Off-Balance Sheet Arrangements
  
The Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
    
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 
None
 
ITEM 4. CONTROLS AND PROCEDURES
 
Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
 
An evaluation was conducted under the supervision and with the participation of our management of the effectiveness of the design and operation of our disclosure controls and procedures as of July 31, 2019. Based on that evaluation, our management concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms.
 
Changes in Internal Controls over Financial Reporting
 
There was no change in the Company’s internal control over financial reporting during the quarterly period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
14
 
 
PART II. OTHER INFORMATION
 
ITEM 1. LEGAL PROCEEDINGS
 
The Company is not presently involved in any litigation nor is it aware of any pending or threatened litigation against us.
 
ITEM 1A. RISK FACTORS
 
N/A
 
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
 
None
 
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
 
None
 
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
 
None
 
ITEM 5. OTHER INFORMATION
 
None
 
ITEM 6. EXHIBITS
 
The following exhibits are included as part of this report by reference:
 
 
 
SIGNATURES
 
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this report to be signed on its behalf by the undersigned, in Tampa, FL, September 13, 2019.
 
 
TREASURE & SHIPWRECK RECOVERY, INC.
 
By:
/s/ Craig Huffman
 
Craig Huffman
Chief Executive Officer,
Chief Financial Officer
Principal Accounting Officer,
Director

 
 
By:
/s/ E. Lee Spence
 
E. Lee Spence
Chairman of the Board of Directors
Chief Operating Officer
 
 
 
15
 
   Exhibit 31.1
 
 
Certification of Chief Executive Officer pursuant to Securities Exchange
Act of 1934 Rule 13a-14(a) or 15d-14(a).
 
I, Craig Huffman, certify that:
 
1. I have reviewed this Quarterly Report on Form 10-Q of Treasure & Shipwreck Recovery, Inc.;
 
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
 
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
 
a)
 
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
 
 
b)
 
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
 
 
c)
 
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
 
 
d)
 
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
 
 
 
5.
 
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
 
 
a)
 
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
 
 
 
b)
 
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
 
  
September 13, 2019  
 
 
By:
/S/ Craig Huffman
Name: 
Name: Craig Huffman
Title:
 
Director (Chief Executive Officer, Chief Financial Officer, Principal Accounting Officer)
 
 
 
    Exhibit 32.1
  
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
 
In connection with the Quarterly Report of Treasure & Shipwreck Recovery, Inc. (the “Company”) on Form 10-Q for the quarter ended July 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Craig Huffman, Chief Executive Officer, Chief Financial Officer, Principal Accounting Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
 
 
(1)
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)
The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
 
 
September 13, 2019

 
By:
/S/ Craig Huffman
Name: 
Craig Huffman
Title:
Director (Chief Executive Officer, Chief Financial Officer, Principal Accounting Officer)
 
 
 
 
 
 
 
 
 
 
 

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