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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM 10-Q


(Mark One)


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


For the quarter period ended June 30, 2015


or


¨ 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: 333-186282


Train Travel Holdings, Inc.

(Exact name of registrant as specified in its charter)


Nevada

33-1225521

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification Number)


2929 East Commercial Blvd., PH-D,

Ft. Lauderdale, Florida 33308

 (Address of principal executive offices)(Zip Code)


954-440-4678

(Registrant’s telephone number, including area code)


Not applicable

 (Former name, former address and former fiscal year, if changed since last report)


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


Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ  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.


Large accelerated filer

o

Accelerated filer

o

Non-accelerated filer

o

Smaller reporting company

þ


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


As of July 31, 2015 the issuer had 38,291,665 shares of its common stock issued and outstanding.

 

 

 




 


Train Travel Holdings. Inc.


Form 10-Q


 

 

Page No.

PART I

FINANCIAL INFORMATION

 

                        

 

                        

ITEM 1.

FINANCIAL STATEMENTS:

1

 

Condensed Balance Sheets (unaudited)

1

 

Condensed Statements of Operations (unaudited)

2

 

Condensed Statements of Changes in Stockholders’ Deficit (unaudited)

3

 

Condensed Statements of Cash Flows (unaudited)

4

 

Notes to Unaudited Condensed Financial Statements

5

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

12

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

18

ITEM 4.

CONTROLS AND PROCEDURES

18

 

 

 

PART II

OTHER INFORMATION

 

 

 

 

ITEM 1.

LEGAL PROCEEDINGS

19

ITEM 1A.

RISK FACTORS

19

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

19

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

19

ITEM 4.

MINE SAFETY DISCLOSURES

19

ITEM 5.

OTHER INFORMATION

19

ITEM 6.

EXHIBITS

19


FORWARD LOOKING STATEMENTS


Statements made in this Form 10-Q that are not historical or current facts are "forward-looking statements. 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.


OTHER PERTINENT INFORMATION


Unless specifically set forth to the contrary, when used in this report the terms “Train Travel”, the “Company,” “we”, “us”, “our” and similar terms refer to Train Travel Holdings, Inc., a Nevada corporation.





 




 


PART 1.  FINANCIAL INFORMATION


ITEM 1.

FINANCIAL STATEMENTS


TRAIN TRAVEL HOLDINGS, INC.

CONDENSED BALANCE SHEETS

 

 

 

June 30,

2015

 

 

December 31,

2014

 

 

 

(Unaudited)

 

 

(Audited)

 

 

  

                         

  

  

                         

  

ASSETS

  

 

 

  

  

 

 

  

 

 

 

 

 

 

 

 

 

CURRENT ASSETS:

 

$

 

 

$

 

Total Current Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Assets

 

$

 

 

$

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' DEFICIT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

 

 

 

Accounts payable

 

$

20,676

 

 

$

17,881

 

Accounts payable - related parties

 

 

53,987

 

 

 

37,513

 

Due to related parties

 

 

230,460

 

 

 

196,912

 

Loan from former stockholder

 

 

2,194

 

 

 

2,194

 

Total Current Liabilities

 

 

307,317

 

 

 

254,500

 

 

 

 

 

 

 

 

 

 

Total Liabilities

 

 

307,317

 

 

 

254,500

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS' DEFICIT:

 

 

 

 

 

 

 

 

Preferred stock, $0.001 par value, 1,000,000 shares authorized;

 

 

 

 

 

 

 

 

600,000 shares issued and outstanding

 

 

600

 

 

 

600

 

Common stock, $0.001 par value, 75,000,000 shares authorized;

 

 

 

 

 

 

 

 

23,391,665 shares issued and outstanding, respectively

 

 

23,392

 

 

 

23,392

 

Additional paid-in-capital

 

 

196,758

 

 

 

196,758

 

Accumulated deficit

 

 

(528,067

)

 

 

(475,250

)

Total Stockholders’ Deficit

 

 

(307,317

)

 

 

(254,500

)

 

 

 

 

 

 

 

 

 

Total Liabilities and Stockholders’ Deficit

 

$

 

 

$

 



See accompanying notes to these condensed unaudited financial statements.

 





1



 


TRAIN TRAVEL HOLDINGS, INC.

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)


 

 

For the Three Months Ended

June 30,

 

 

For the Six Months Ended

June 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

 

  

                         

    

  

                         

    

  

                         

    

  

                         

  

Net Sales

 

$

 

 

$

 

 

$

 

 

$

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses

 

 

5,573

 

 

 

3,891

 

 

 

8,779

 

 

 

7,480

 

Legal and professional- related party

 

 

16,758

 

 

 

247,337

 

 

 

29,671

 

 

 

813,337

 

Legal and professional

 

 

13,267

 

 

 

13,899

 

 

 

14,367

 

 

 

21,102

 

Total Operating Expenses

 

 

35,598

 

 

 

265,127

 

 

 

52,817

 

 

 

841,919

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss From Operations

 

 

(35,598

)

 

 

(265,127

)

 

 

(52,817

)

 

 

(841,919

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss)

 

$

(35,598

)

 

$

(265,127

)

 

$

(52,817

)

 

$

(841,919

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss Per Common Share – basic and diluted

 

$

(0.00

)*

 

$

(0.01

)

 

$

(0.00

)*

 

$

(0.04

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Number of Common Shares Outstanding-Basic and Diluted

 

 

23,391,665

 

 

 

20,334,267

 

 

 

23,391,665

 

 

 

19,869,714

 


* Denotes a loss of less than $(0.01) per share.


See accompanying notes to these condensed unaudited financial statements.

 






2



 


TRAIN TRAVEL HOLDINGS, INC.

CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT

For the Six Months Ended June 30, 2015 and Year Ended December 31, 2014


 

 

Preferred Stock

 

 

Common Stock

 

 

 

 

 

Retained Earnings

 

 

Total

 

 

 

$0.001 Par Value

 

 

$0.001 Par Value

 

 

Additional

 

 

(Deficit)

 

 

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Shares*

 

 

Amount*

 

 

Paid-in Capital*

 

 

Accumulated

 

 

Equity(Deficit)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at January 1, 2014

 

 

 

 

$

 

 

 

19,400,000

 

 

$

19,400

 

 

$

2,800

 

 

$

(22,226

)

 

$

(26

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of preferred stock for services ($0.006 per share)

 

 

600,000

 

 

 

600

 

 

 

 

 

 

 

 

 

174,000

 

 

 

 

 

 

174,600

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of shares of common stock in settlement of non-interest bearing advances-related party ($0.006 per share)

 

 

 

 

 

 

 

 

3,991,665

 

 

 

3,992

 

 

 

19,958

 

 

 

 

 

 

23,950

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss for the year

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(453,024

)

 

 

(453,024

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2014 (Audited)

 

 

600,000

 

 

 

600

 

 

 

23,391,665

 

 

 

23,392

 

 

 

196,758

 

 

 

(475,250

)

 

 

(254,500

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss for the six months ended June 30, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(52,817

)

 

 

(52,817

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at June 30, 2015 (Unaudited)

 

 

600,000

 

 

$

600

 

 

 

23,391,665

 

 

$

23,392

 

 

$

196,758

 

 

$

(528,067

)

 

$

(307,317

)


* as retroactively adjusted for the 5:1 forward split completed April 4, 2014.


See accompanying notes to these condensed unaudited financial statements.





3



 


TRAIN TRAVEL HOLDINGS, INC.

(FORMERLY VANELL CORP.)

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

Six Months Ended

June 30,

 

 

 

2015

 

 

2014

 

 

  

                         

  

  

                         

  

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

Net loss

 

$

(52,817

)

 

$

(841,919

)

Adjustments to reconcile net loss to net cash generated (used in ) operating activities:

 

 

 

 

 

 

 

 

Preferred stock issued for services

 

 

 

 

 

291,000

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Other receivables

 

 

 

 

 

(114,456

)

Prepaid expenses

 

 

 

 

 

2,000

 

Accounts payable

 

 

2,795

 

 

 

11,790

 

Accounts payable - related party

 

 

16,474

 

 

 

 

Due to related parties - management expenses

 

 

33,548

 

 

 

500,000

 

Net cash used in operating activities

 

 

 

 

 

(151,585

)

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Net cash provided by (used in) investing activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Bank overdraft

 

 

 

 

 

(10

)

Due to related parties - other costs

 

 

 

 

 

151,595

 

Net cash provided by financing activities

 

 

 

 

 

151,585

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash - beginning of year

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash - end of the period

 

$

 

 

$

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

 

 

 

 

 

 

 

 

Cash paid for:

 

 

 

 

 

 

 

 

Interest

 

$

 

 

$

 

Taxes

 

$

 

 

$

 

 

 

 

 

 

 

 

 

 

NON-CASH INVESTING AND FINANCIAL ACTIVITIES:

 

 

 

 

 

 

 

 

Settlement of related party advances for 2,931,665 shares of common stock

 

$

 

 

$

29,317

 


During the six months ended June 30, 2015, the Company did not maintain a bank account. All payments were made on behalf of the Company by the Company's parent company, Train Travel Holdings, Inc. (Florida)




See accompanying notes to these condensed unaudited financial statements.



4



 


TRAIN TRAVEL HOLDINGS, INC.

NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED JUNE 30, 2015 AND 2014


NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Organization and Description of Business


TRAIN TRAVEL HOLDINGS, INC. (“the Company” or “TTHX”) was incorporated under the laws of the State of Nevada on September 7, 2012 (“Inception”).


From Inception in 2012 through December 2013, our business operations were limited primarily to the development of a business plan to provide consulting services to commercial growers of coffee in El Salvador, the completion of private placements for the offer and sale of our common stock, discussing the offers of consulting services with potential customers, and the signing of the service agreement with Finca La Esmeralda, a private El-Salvadorian company. We discontinued our coffee business on January 23, 2014.


Commencing January 23, 2014, our business plan changed to the acquisition and operation of entertainment train companies, as well as managing and providing consulting services to entertainment train companies. Since January 2014 our management has spent all of its time and effort on developing our business plan, including identifying specific entertainment railroad acquisition targets, engaging in discussions with these potential targets to ascertain the potential level of interest, negotiating general terms with targets, and undertaking early stage due diligence of potential targets. As a result, we entered into non-binding letters of intent with two acquisition candidates and subsequently performed initial stage due diligence. In one case, the railroad was in such disrepair we determined the acquisition to not be feasible at the price being sought by the target. In another case, we determined the price was too high based on our due diligence and could not reach an agreement with the potential seller. We also entered into a series of agreements to operate a dinner train in Missouri which were subsequently unwound. In light of the forgoing, our management has looked to potential new lines of business in addition to pursuing our current line of business.


On July 6, 2015, TTHX completed an agreement (“the Agreement”) with Turnkey Home Buyers USA, Inc., a Florida corporation (“Turnkey”), TBG Holdings Corporation (‘TBG’), each of the Turnkey shareholders and Train Travel Holdings, Inc., a Florida corporation. TTHX, Turnkey, TBG and Train Travel Holdings, Inc., a Florida corporation, are all under the common control of Neil Swartz and Tim Hart.  


Pursuant to the terms of the Agreement, Turnkey shareholders transferred to TTHX all of the issued and outstanding shares of capital stock of Turnkey’s shareholders. In exchange for the acquisition of 100% of Turnkey issued and outstanding shares, TTHX issued 14,900,000 shares of its common stock to Turnkey shareholders. Prior to closing, TBG, a principal shareholder of TTHX and Turnkey, tendered to Turnkey for cancellation 15,000,000 shares of Turnkey common stock.


The TTHX shares issued to the Turnkey shareholders were not registered and were issued in a transaction which was exempt from the registration requirements pursuant to Section 4(a)(2) of the Securities Act of 1933. Each of the Turnkey shareholders were accredited investors and no underwriters or placement agents were involved.


 As a result of the Agreement, the Turnkey shareholders will own 39% of TTHX common stock.


Effective July 6, 2015, the Board of Directors of TTHX appointed Robert Blair, a principal of Turnkey and formerly a TBG shareholder, as a director of TTHX.  


Founded in September 2014, Turnkey offers clients a full suite of services for residential and commercial real estate transactions. As part of the acquisition, the Company will acquire Turnkey’s subsidiary, a real estate brokerage firm, to handle the sales transactions. Turnkey generates revenue in three primary ways: coaching and mentoring real estate investors to improve their returns, leasing and sales of quality turnkey rental properties, and brokerage of residential and commercial transactions.


 



5



TRAIN TRAVEL HOLDINGS, INC.

NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED JUNE 30, 2015 AND 2014



NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CONTINUED


In September 2014, Turnkey acquired the intellectual properties of Robert Blair Real Estate, which included videos, instructional books, and an established real estate investor education program. In the first two quarters of 2015, Turnkey has acquired a real estate rental portfolio with over 20% equity and generating a double-digit cash-on-cash annual return on investment. Prior to September 2014, Turnkey’s current management team has been mentoring real estate investors for over 20 years, generating millions of dollars in educational revenue, while providing quality wholesale properties for sale or rent.


Turnkey and its existing subsidiary, will be run as subsidiary companies of TTHX and are planning to execute aggressive marketing campaigns and live seminars that will drive traffic to both the education and coaching programs, as well as the wholesale turnkey properties that Turnkey offers to its clients.


The Company now has two operating divisions:  (1) the new Turnkey Home Buyers real estate operations and (2) the Train Travel railroad operations, which is actively pursuing acquisitions or management agreements in the excursion railroad industry.


Change of Control


On January 23, 2014, Mr. Francisco Douglas Magana (“Magana”), our then president and controlling shareholder, entered into a Common Stock Purchase Agreement (the “Agreement”) with the Company and Train Travel Holdings Inc. (“Travel Train Holdings Florida”) wherein Magana sold 15,000,000 shares of the Company’s common stock constituting 77.32% of the Company’s issued and outstanding shares of common stock to Travel Train Holdings Florida for an aggregate purchase price of $150,000. The principals of Travel Train Holdings Florida are Neil Swartz and Timothy Hart.


As part of the Agreement, Magana tendered his letter of resignation as the President, Secretary, Treasurer, Director and member of the Company Board effective as of the date of the Agreement.


On January 23, 2014, in Lieu of a Special Meeting the Board of Directors of the Company, we accepted the resignation of Magana and elected Neil Swartz to the positions of Director, President and CEO of the Company and Timothy Hart to the positions of Director, Secretary and CFO.


Accounting Basis

The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting). The Company has adopted December 31 fiscal year end.


Unaudited Interim Financial Statements

The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America for interim financial information and with the instructions to Form 10-Q.  Accordingly, the financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.


In the opinion of management, all adjustments consisting of normal recurring entries necessary for a fair statement of the periods presented for: (a) the financial position; (b) the result of operations; and (c) cash flows, have been made in order to make the financial statements presented not misleading.  The results of operations for such interim periods are not necessarily indicative of operations for a full year.


While management of the Company believes that the disclosures presented herein are adequate and not misleading, these condensed interim financial statements should be read in conjunction with the audited combined financial statements and the footnotes thereto for the year ended December 31, 2014 filed on Form 10-K on April 20, 2015.




6



TRAIN TRAVEL HOLDINGS, INC.

NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED JUNE 30, 2015 AND 2014



NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CONTINUED


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.


Development Stage Company

The Company is in the development stage as defined under the then current Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 915-205 “Development-Stage Entities,” and among the additional disclosures required as a development stage company are that our financial statements were identified as those of a development stage company, and that the statements of operations, stockholders’ deficit and cash flows disclosed activity since the date of our inception (September 7, 2012) as a development stage company. Effective June 10, 2014 FASB changed its regulations with respect to Development Stage Entities and these additional disclosures are no longer required for annual reporting periods beginning after December 15, 2014 with the option for entities to early adopt these new provisions. Consequently these additional disclosures are no longer included in these financial statements.


Foreign Currency Translation

The Company's functional currency and its reporting currency is the United States dollar.


Cash and Cash Equivalents

The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes. As of June 30, 2015 and December 31, 2014 the Company did not maintain any bank accounts.


Impairment of Long-Lived Assets

The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell.


Fair Value of Financial Instruments

The Company’s financial instruments consist of accounts payable, accounts payable related parties, advances related parties and an amount due to its former sole officer, director and major stockholder. The carrying amount of these financial instruments approximates fair value due to their short term maturities.


Income Taxes

The Company follows the liability method of accounting for income taxes. Under this method, deferred income tax assets and liabilities are recognized for the estimated tax consequences attributable to differences between the financial statement carrying values and their respective income tax basis (temporary differences). The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.


Revenue Recognition

Revenue is recognized when all of the following criteria were met: persuasive evidence of an arrangement existed, services had been provided, all significant contractual obligations had been satisfied, and collection was reasonably assured.




7



TRAIN TRAVEL HOLDINGS, INC.

NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED JUNE 30, 2015 AND 2014



NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CONTINUED


Advertising Costs

The Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred advertising expense of $0 during the three and six month periods ended June 30, 2015 and 2014.


Stock-Based Compensation

As of June 30, 2015 the Company has not issued any stock-based payments to its employees. Stock-based compensation is accounted for at fair value in accordance with SFAS ASC 718, when applicable. To date, the Company has not adopted a stock option plan and has not granted any stock options.


Basic Income (Loss) Per Share

Basic earnings per share (“EPS”) is computed by dividing the net loss attributable to the Company that is available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential shares of common stock outstanding during the period including stock warrants using the treasury stock method (by using the average stock price for the period to determine the number of shares assumed to be purchased from the exercise of warrants) and convertible debt or convertible preferred stock using the if-converted method. Diluted EPS excludes all dilutive potential of shares of common stock if their effect is anti-dilutive.  During the three months ended March 31, 2014, the Company issued 600,000 shares of preferred stock convertible into 29,100,000 shares of common stock. These potentially dilutive shares have been excluded from the calculation of loss per share as the inclusion of such shares would be anti-dilutive as the Company had losses during the three and six month periods ended June 30, 2015 and 2014. 


Dividends

The Company has not adopted any policy regarding payment of dividends. No dividends have been paid during any of the periods shown.


Recent accounting pronouncements

The Company does not believe that any recently issued, but not yet adopted, accounting pronouncements will have a material impact on its financial position, results of operations or cash flows.


NOTE 2 – GOING CONCERN


The financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. As at June 30, 2015, the Company had no cash on hand, has incurred losses since Inception of $528,067 and further losses are anticipated in the development of its business raising substantial doubt about the Company’s ability to continue as a going concern. The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and, or, obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. There is no assurance that these events will be satisfactorily completed.

 



8



TRAIN TRAVEL HOLDINGS, INC.

NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED JUNE 30, 2015 AND 2014



NOTE 3 – DUE TO RELATED PARTIES


As of June 30, 2015, accounts payable - related parties and balance due to related parties totaled $284,447. These non-interest bearing balances are due to Travel Train Holdings Florida, and are repayable on demand and are related to accounting services provided to the Company by Travel Train Holdings Florida.


As of December 31, 2014, balances due to related parties totaled $196,912 of which $28,418 was for funding our ongoing operating expenses and $168,494 was advanced to Columbia Star Dinner to fund their operations during the period the Company was negotiating to purchase the entertainment train. The balance of accounts payable – related parties as of December 31, 2014 totaled $37,513 and related to accounting services provided to the Company by Travel Train Holdings Florida.


On September 7, 2012, the Director loaned $274 to the Company to pay for incorporation expenses from Inception to January 23, 2014, the former director loaned an additional $1,920 to fund the Company’s operating expenses. This loan balance is still outstanding as of June 30, 2015 and December 31, 2014. This loan is non-interest bearing, due upon demand and unsecured.


NOTE 4 – PREFERRED STOCK


The Company has 1,000,000 preferred shares authorized with a par value of $ 0.001 per share.


On January 23, 2014, in conjunction with the Stock Purchase Agreement, the Company authorized the issuance of 600,000 preferred shares convertible into 29,100,000 common shares as compensation for services to be provided to the Company by its Chairman and Chief Financial Officer. The fair market value of the preferred shares at the date of their issuance was determined by management to be $174,600. The fair market value of the shares of preferred stock at their date of issuance was determined using the price of the most recent sale of the Company’s shares of common stock for cash. The Company did not use the quoted market price of its common shares as there has been no active trading market in the Company’s common shares.  


NOTE 5 – COMMON STOCK


The Company has 75,000,000 common shares authorized with a par value of $ 0.001 per share.


On April 4, 2014 the Company effectuated a forward 5 for 1 split of its common stock. All common stock references and per share amounts in these financial statements have been restated to reflect this 5 for 1 forward split.


On June 1, 2014, the Company issued 2,931,665 shares of its common stock to settle $17,590 of its March 31, 2014 non-interest bearing advance balance with Train Travel Holdings Florida. The fair market value of the shares of common stock at their date of issuance was determined using the price of the most recent sale of the Company’s shares of common stock for cash. The Company did not use the quoted market price of its common shares as there has been no active trading market in the Company’s common shares and consequently the quoted price in a highly illiquid market is not indicative of the true fair value of these shares.


On August 15, 2014, the Company issued 1,060,000 shares of its common stock to settle $6,360 of its non-interest bearing advance balance of with Train Travel Holdings Florida. The fair market value of the shares of preferred stock at their date of issuance was determined using the price of the most recent sale of the Company’s shares of common stock for cash. The Company did not use the quoted market price of its common shares as there has been no active trading market in the Company’s common shares and consequently the quoted price in a highly illiquid market is not indicative of the true fair value of these shares.


As at June 30, 2015 and December 31, 2014, 23,391,665 shares of our common stock were issued and outstanding.


As disclosed in Note 9 – Subsequent Events below, effective August, 10, 2015 the Company issued 14,900,000 shares of its common stock to the Turnkey shareholders in connection with its acquisition of Turnkey.




9



TRAIN TRAVEL HOLDINGS, INC.

NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED JUNE 30, 2015 AND 2014



NOTE 6 – RELATED PARTY TRANSACTIONS


On January 23, 2014, Francisco Douglas Magana tendered his letter of resignation as the President, Secretary, Treasurer, Director and member of the Board effective as of that date.


On January 23, 2014, in Lieu of a Special Meeting the Board of Directors of the Company via Unanimous Written Consent, accepted the resignation of Francisco Douglas Magana, in addition elected Neil Swartz to the positions of Director, President and CEO of the Company and Timothy Hart to the positions of Director, Secretary and CFO until their successors are appointed.


On January 23, 2014, the Company entered in to a Common Stock Purchase Agreement by and among the Company, Francisco Douglas Magana (the “Seller”) and Train Travel Holdings, Inc., a Florida Corporation where by the Seller who is beneficially the owner of 15,000,000 shares of the Company’s common stock, par value $0.001 desires to sell, and the Purchaser, desires to purchase the full block of shares for an aggregate purchase price of $150,000.


On January 23, 2014, in conjunction with the Stock Purchase Agreement, the Company authorized the issuance of 600,000 preferred shares convertible into 29,100,000 common shares as compensation for services to be provided to the Company by its Chairman and Chief Financial Officer. The fair market value of the preferred shares at the date of their issuance was determined by management to be $174,600. The fair market value the shares of preferred stock at their date of issuance was determined using the price of the most recent sale of the Company’s shares of common stock for cash. The Company did not use the quoted market price of its common shares as there has been no active trading market in the Company’s common shares and consequently the quoted price in a highly illiquid market is not indicative of the true fair value of these shares.


On June 1, 2014, the Company issued 2,931,665 shares of its common stock to settle $17,590 of its March 31, 2014 non-interest bearing advance balance with Train Travel Holdings Florida. The fair market value the shares of preferred stock at their date of issuance was determined using the price of the most recent sale of the Company’s shares of common stock for cash. The Company did not use the quoted market price of its common shares as there has been no active trading market in the Company’s common shares and consequently the quoted price in a highly illiquid market is not indicative of the true fair value of these shares.


On August 15, 2014, the Company issued 1,060,000 shares of its common stock to settle $6,360 of its June 30, 2014 non-interest bearing advance by Train Travel Holdings Florida. The fair market value the shares of common stock at their date of issuance was determined using the price of the most recent sale of the Company’s shares of common stock for cash. The Company did not use the quoted market price of its common shares as there has been no active trading market in the Company’s common shares and consequently the quoted price in a highly illiquid market is not indicative of the true fair value of these shares.


As of June 30, 2015, accounts payable - related parties and balance due to related parties totaled $284,447. These non-interest bearing balances are due to Train Travel Holdings Florida, and are repayable on demand. As of June 30, 2015, balances due to related parties totaled $230,460 and accounts payable – related parties totaled $53,987 and related to accounting services provided to the Company by Travel Train Holdings Florida.


 As of December 31, 2014, balances due to related parties totaled $196,912 of which $28,418 was for funding our ongoing operating expenses and $168,494 was advanced to Columbia Star Dinner to fund their operations during the period the Company was negotiating to purchase the entertainment train. The balance of accounts payable – related parties as of December 31, 2014 totaled $37,513 and related to accounting services provided to the Company by Train Travel Holdings Florida.


On September 7, 2012, the Director loaned $274 to the Company to pay for incorporation expenses from Inception to January 23, 2014, the former director loaned an additional $1,920 to fund the Company’s operating expenses. This loan balance is still outstanding as of June 30, 2015 and December 31, 2014. This loan is non-interest bearing, due upon demand and unsecured




10



TRAIN TRAVEL HOLDINGS, INC.

NOTES TO THE CONDENSED UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTH PERIODS ENDED JUNE 30, 2015 AND 2014



NOTE 7 – INCOME TAXES


As of June 30, 2015 the Company had a net operating loss carry-forward of approximately $528,067 that can be used to offset future taxable income and begins to expire in 2032. Should a change in ownership occur, net operating loss carry forwards can be limited as to use in future years.

 

NOTE 8 – COMMITMENTS AND CONTINGENCIES


Contractual


As of June 30, 2015, the Company had not entered into and was not subject to any contractual commitments.


Legal


The Company was not subject to any legal proceedings during three and six month periods ended June 30, 2015 or 2014 and, to the best of our knowledge, no legal proceedings are threatened or pending.


NOTE 9 – SUBSEQUENT EVENTS


On July 6, 2015, TTHX completed an agreement (“the Agreement”) with Turnkey Home Buyers USA, Inc., a Florida corporation (“Turnkey”), TBG Holdings Corporation (‘TBG’), each of the Turnkey shareholders and Train Travel Holdings, Inc., a Florida corporation. TTHX, Turnkey, TBG and Train Travel Holdings, Inc., a Florida corporation, are all under the common control of Neil Swartz and Tim Hart.


Pursuant to the terms of the Agreement, Turnkey shareholders transferred to TTHX all of the issued and outstanding shares of capital stock of Turnkey’s shareholders. In exchange for acquiring 100% of the issued and outstanding Turnkey shares, TTHX issued 14,900,000 shares of its common stock to Turnkey shareholders. Prior to closing, TBG, a principal shareholder of TTHX and Turnkey, tendered to Turnkey for cancellation 15,000,000 shares of Turnkey common stock.


The TTHX shares issued to the Turnkey shareholders were not registered and were issued in a transaction which was exempt from the registration requirements pursuant to Section 4(a)(2) of the Securities Act of 1933. Each of the Turnkey shareholders were accredited investors and no underwriters or placement agents were involved.


As a result of the Agreement, the Turnkey shareholders will own approximately 39% of TTHX common stock.


Effective July 6, 2015, the Board of Directors of TTHX appointed Robert Blair, a principal of Turnkey and formerly a TBG shareholder, as a director of TTHX.


The Company has evaluated all other subsequent events from June 30, 2015 to the date the financial statements were issued and has determined that, other than disclosed above, it does not have any further material subsequent events to disclose in these financial statements.






11



 


ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.


This report on Form 10-Q and other reports filed by Train Travel from time to time with the U.S. Securities and Exchange Commission (collectively, the “Filings”) contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, the Company’s management as well as estimates and assumptions made by Company’s management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the filings, the words “anticipate,” “believe,” “estimate,” “expect,” “future,” “intend,” “plan,” or the negative of these terms and similar expressions as they relate to the Company or the Company’s management identify forward-looking statements. Such statements reflect the current view of the Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors, including the risks contained in elsewhere in this report, relating to the Company’s industry, the Company’s operations and results of operations, and any businesses that the Company may acquire. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned.


OVERVIEW


From inception in 2012 through December 2013 our business operations were limited primarily to the development of a business plan to provide consulting services to commercial growers of coffee in El Salvador, the completion of private placements for the offer and sale of our common stock, discussing the offers of consulting services with potential customers, and the signing of the service agreement with Finca La Esmeralda, a private El-Salvadorian company. We discontinued our coffee business on January 23, 2014.


Commencing January 23, 2014, our business plan changed to the acquisition and operation of entertainment train companies, as well as managing and providing consulting services to entertainment train companies. Since January 2014 our management has spent all of its time and effort on developing our business plan, including identifying specific entertainment railroad acquisition targets, engaging in discussions with these potential targets to ascertain the potential level of interest, negotiating general terms with targets, and undertaking early stage due diligence of potential targets. As a result, we entered into non-binding letters of intent with two acquisition candidates and subsequently performed initial stage due diligence. In one case, the railroad was in such disrepair we determined the acquisition to not be feasible at the price being sought by the target. In another case, we determined the price was too high based on our due diligence and could not reach an agreement with the potential seller. We also entered into a series of agreements to operate a dinner train in Missouri which were subsequently unwound. In light of the forgoing, our management has looked to potential new lines of business in addition to pursuing our current line of business.


On July 6, 2015, TTHX completed an agreement (“the Agreement”) with Turnkey Home Buyers USA, Inc., a Florida corporation (“Turnkey”), TBG Holdings Corporation (‘TBG’), each of the Turnkey shareholders and Train Travel Holdings, Inc., a Florida corporation. TTHX, Turnkey, TBG and Train Travel Holdings, Inc., a Florida corporation, are all under the common control of Neil Swartz and Tim Hart.


Pursuant to the terms of the Agreement, Turnkey shareholders transferred to TTHX all of the issued and outstanding shares of capital stock of Turnkey’s shareholders. In exchange for the acquisition of all of the issued and outstanding shares of Turnkey, TTHX issued 14,900,000 shares of its common stock to Turnkey shareholders. Prior to closing, TBG, a principal shareholder of TTHX and Turnkey, tendered to Turnkey for cancellation 15,000,000 shares of Turnkey common stock.


 The TTHX shares issued to the Turnkey shareholders were not registered and were issued in a transaction which was exempt from the registration requirements pursuant to Section 4(a)(2) of the Securities Act of 1933. Each of the Turnkey shareholders were accredited investors and no underwriters or placement agents were involved.


As a result of the Agreement, the Turnkey shareholders will own approximately 39% of TTHX common stock.


Effective July 6, 2015, the Board of Directors of TTHX appointed Robert Blair, a principal of Turnkey and formerly a TBG shareholder, as a director of TTHX.  



12



 


Founded in September 2014, Turnkey offers clients a full suite of services for residential and commercial real estate transactions. As part of the acquisition, the Company will acquire Turnkey’s subsidiary, a real estate brokerage firm, to handle the sales transactions. Turnkey generates revenue in three primary ways: coaching and mentoring real estate investors to improve their returns, leasing and sales of quality turnkey rental properties, and brokerage of residential and commercial transactions.


In September 2014, Turnkey acquired the intellectual properties of Robert Blair Real Estate, which included videos, instructional books, and an established real estate investor education program. In the first two quarters of 2015, Turnkey has acquired a real estate rental portfolio with over 20% equity and generating a double-digit cash-on-cash annual return on investment. Prior to September 2014, Turnkey’s current management team has been mentoring real estate investors for over 20 years, generating millions of dollars in educational revenue, while providing quality wholesale properties for sale or rent.


Turnkey and its existing subsidiary will be run as subsidiary companies of TTHX and are planning to execute aggressive marketing campaigns and live seminars that will drive traffic to both the education and coaching programs, as well as the wholesale turnkey properties that Turnkey offers to its clients.


The Company now has two operating divisions:  (1) the new Turnkey Home Buyers real estate operations and (2) the Train Travel railroad operations, which is actively pursuing acquisitions in the excursion railroad industry.


Turnkey’s Single-Family Rental home division has developed an acquisition platform that is capable of acquiring large numbers of properties across many acquisition channels in multiple markets. When identifying desirable markets, the company focuses on steady population growth, strong rental demand and a desirable level of distressed sales of homes that can be acquired below replacement cost, providing for attractive potential rental yields and capital appreciation. More specifically, the company looks to acquire single-family homes in select submarkets that are appealing to middle income families, based on its disciplined market selection criteria, such as above-average median household incomes, well-regarded school districts, proximity to employment centers and lifestyle amenities, access to transportation routes and public transit and low crime levels. Turnkey believes that homes in these areas will attract tenants with strong credit profiles, produce high occupancy/rental rates, providing for long-term property appreciation potential.


Initially, Turnkey is purchasing properties in the single-family rental home market in Florida, due to the favorable environment for investment and high rental demand, as well as yield potential. As the Company grows its portfolio, it will be better positioned to acquire properties on a much larger scale. Turnkey intends to continually evaluate potential new markets where it could invest and establish operations as opportunities emerge. As of this date Turnkey owns three single-family rental properties.


Turnkey’s educational program provides clients’ access to an all-inclusive Real Estate investing educational company.  The educational and consulting company utilizes its expertise and experience to work with clients and entrepreneurs that seek to enter the real estate industry, in order to provide them with a high quality turnkey investment solution.


The Turnkey educational program offers clients direct relationships with a team of experts in different niches of real estate, allowing them to gain a competitive advantage in their real estate investing careers. Each client is assigned a personal mentor, based on their specific real estate investing goals, who will provide support through phone and email to address their most time sensitive real estate questions. The personal mentor will work with clients to analyze deals, helping to mitigate risk and maximize profitability of each potential real estate investment. Management believes three of the primary factors in real estate investing success are experience, time-tested strategies, and proven techniques - which is why Turnkey’s educational program creates a collaborative environment.  By joining Turnkey educational program, clients will gain access to a fulfillment platform that allows clients to collaborate, share experiences and benefit from Turnkey’s national buying power.



13



 


Turnkey’s educational program offers clients an affordable specialized educational curriculum based on their specific goals, experience levels and time commitments. This includes creating a weekly action plan to organize and prioritize what each client needs to execute on a day to day basis as well as providing the essential documents and resources needed to complete the action plan, including training modules, step-by-step videos and downloadable implementation checklists. Clients will have access to on demand weekly training webinars, where mentors review the elements of closing deals, from fundamental lead-generation marketing campaigns, deal analysis, to available financing options, writing risk-free contracts and submitting profitable offers. These webinars are designed to help clients develop their entrepreneurial skills and master the implementation of the crucial aspects of their real estate careers. Management believes that one of the best ways for entrepreneurs to grow professionally is through case studies not only from coaches, but also from students. To foster educational growth, clients who recently completed deals will also conduct live case studies, allowing members to have a comprehensive view of the deal including, the obstacles they encountered and how challenges were overcome in the process.  


RESULTS OF OPERATION


Three Months Ended June 30, 2015 Compared to the Three Month Period Ended June 30, 2014


Revenue


During the three month period ended June 30, 2015 and 2014, we generated revenues of $0, respectively as we had no revenue generating activities in the period.


Operating expenses


During the three month period ended June 30, 2015, we incurred operating expenses of $35,598 compared to $265,127 incurred for the three months ended June 30, 2014.


Throughout 2014 the Company 1) put in place an operating structure for the identification and evaluation of entertainment train assets. This structure included management and operation specialists in the entertainment train industry, 2) continued developing a centralized reservation system for uniform reservation for all current and future entertainment train assets and 3) continued to set up a centralized marketing team.


During the three month period ended June 30, 2015, we incurred general and administrative expenses of $5,573 compared to $3,891 incurred for the three months ended June 30, 2014.


General and administrative and professional fee related party expenses incurred during the two periods were generally related to corporate overhead, financial and administrative contracted services, such developmental costs associated with the acquisition and operation of entertainment trains, and marketing expenses.


During the three month period ended June 30, 2015, we incurred professional fees related party of $16,758 compared to $247,337 incurred for the three months ended June 30, 2014.


During the three months ended June 30, 2014, we incurred $247,337 in legal and professional fees with Train Travel Holdings Florida, who provided us with the following services in the year:


·

put in place an operating structure for the identification and evaluation of entertainment train assets. This structure included management and operation specialists in the entertainment train industry,


·

set up a centralized reservation system for uniform reservation for all current and future entertainment train assets. The completion and implementation of the reservation system is on hold until the Company has closed on its first entertainment dinner train,


·

set up a centralized marketing team,


·

negotiated an agreement for the purchase of the Columbia Star Dinner Train, located in Columbia although subsequently this agreement was terminated during the 4 th Quarter 2014,




14



 


·

negotiated a letter of intent to purchase the Dinner Trains of New England and this has since been canceled, and


·

arranged discussions with Napa Valley Dinner Train ( NVDT ) as to a possible acquisition although subsequently this agreement was terminated during the 2nd Quarter 2015.


Subsequent to June 30, 2014, but prior to December 31, 2014, we received a credit from Train Travel Holdings Florida, for substantially all professional fees related party charged to us during the three months ended June 30, 2014.


During the three month period ended June 30, 2015, we incurred legal and professional fees of $13,267, broadly compared to $13,899 incurred for the three months ended June 30, 2014.


Net Losses


Our net loss for the three month period ended June 30, 2015 was $35,598 compared to a net loss of $265,127 for the three months ended June 30, 2015 due to the factors discussed above.


Six Months Ended June 30, 2015 Compared to the Six Month Period Ended June 30, 2014


Revenue


During the six month period ended June 30, 2015 and 2014, we generated revenues of $0, respectively, as we had no revenue generating activities during these periods.


Operating expenses


Throughout 2014 the Company 1) put in place an operating structure for the identification and evaluation of entertainment train assets. This structure included management and operation specialists in the entertainment train industry, 2) continued developing a centralized reservation system for uniform reservation for all current and future entertainment train assets and 3) continued to set up a centralized marketing team


During the six month period ended June 30, 2015, we incurred operating expenses of $52,817 compared to $841,919 incurred for the six months ended June 30, 2014.


During the six month period ended June 30, 2015, we incurred general and administrative expenses of $8,779 compared to $7,480 incurred for the six months ended June 30, 2014.


General and administrative and professional fee related party expenses incurred during the two periods were generally related to corporate overhead, financial and administrative contracted services, such as developmental costs associated with the acquisition and operation of entertainment trains, and marketing expenses.


During the six month period ended June 30, 2015, we incurred professional fees related party of $29,671 compared to $813,337 incurred for the six months ended June 30, 2014.


During the six months ended June 30, 2014, we incurred $813,337 in legal and professional fees with Train Travel Holdings Florida, who provided us with the following services in the year:


·

put in place an operating structure for the identification and evaluation of entertainment train assets. This structure included management and operation specialists in the entertainment train industry,


·

set up a centralized reservation system for uniform reservation for all current and future entertainment train assets. The completion and implementation of the reservation system is on hold until the Company has closed on its first entertainment dinner train,


·

set up a centralized marketing team,



15



 


·

negotiated an agreement for the purchase of the Columbia Star Dinner Train, located in Columbia although subsequently this agreement was terminated during the 4 th Quarter 2014,


·

negotiated a letter of intent to purchase the Dinner Trains of New England and this has since been canceled, and


·

arranged discussions with Napa Valley Dinner Train ( NVDT ) as to a possible acquisition. although subsequently this agreement was terminated during the 2nd Quarter 2015.


Subsequent to June 30, 2014, but prior to December 31, 2014, we received a credit from our parent company, Train Travel Holdings (Florida), for substantially all professional fees related party charged to us during the six months ended June 30, 2014.


During the six month period ended June 30, 2015, we incurred legal and professional fees of $14,367 compared to $21,102 incurred for the six months ended June 30, 2014, a decrease of $6,735 arising from the normal course of operations.


Net Losses


Our net loss for the six month period ended June 30, 2015 was $52,817 compared to a net loss of $841,919 for the six months ended June 30, 2014 due to the factors discussed above.


LIQUIDITY AND CAPITAL RESOURCES


As of June 30, 2015


As of June 30, 2015 our current assets were $0 compared to $0 in current assets at December 31, 2014. As of June 30, 2015, our current liabilities were $307,317 compared to $254,500 in current liabilities at December 31, 2014. At June 30, 2015 current liabilities consisted of advances and accounts payable from related parties totaling $284,447, $2,194 advanced from the former director and accounts payable of $20,676. As of December 31, 2014, current liabilities consisted of advances and accounts payable from related parties totaling $234,425, $2,194 advanced from a former director and accounts payable of $17,881.


As at June 30, 2015 the Company had no cash on hand as it does not maintain a bank account, has incurred losses since inception of $528,067 and further losses are anticipated in the development of its business raising substantial doubt about the Company’s ability to continue as a going concern.  The ability to continue as a going concern is dependent upon the Company generating profitable operations in the future and, or, obtaining the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. There is no assurance that these events will be satisfactorily completed.


Stockholders’ deficit increased from ($254,500) as of December 31, 2014 to ($307,317) as of June 30, 2015.


Cash Flows from Operating Activities


For the six months ended June 30, 2015, net cash flows (used) in operating activities was $0 compared to $(151,585) cash flow used in operating activities for the six months ended June 30, 2014.


During the six months ended June 30, 2015, we incurred losses of $52,817 which was fully offset for cash flow purposes by an increase of $2,795 in accounts payable, $16,474 in accounts payable related party and $33,548 in advances due to related parties.


By comparison, during the six months ended June 30, 2014 we incurred losses of $841,919 which was increased for cash flow purposes by an increase on other receivables of $114,456 and then fully offset for cash flow purposes by $291,000 of non-cash expenses relating to the issuance of preferred comparison, an increase $500,000 in accounts payable related party, $11,790 in accounts payable and a decrease in prepaid expenses of $2,000.




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Cash Flows from Investing Activities


We neither generated nor used any in funds in investing activities during the six months ended June 30, 2015 or 2014.


Cash Flows from Financing Activities


During the six months ended June 30, 2015, we neither generated nor used any in funds in financing activities while by comparison during the six months ended June 30, 2014 we repaid a bank overdraft of $10 and received $151,595 from our parent company.


PLAN OF OPERATION AND FUNDING


With the acquisition of Turnkey we anticipate that Turnkey will generate cash flow for working capital requirements. In addition, and if necessary, we expect that working capital requirements may continue to be funded through further loans from Train Travel Holdings Florida and further issuances of securities for the short term until acquisitions are identified and in place generating positive cash flow. Our working capital requirements are expected to increase in line with the growth of our business.


There is no working capital or anticipated cash flow, nor do we have lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to the management of entertainment trains and to the acquisition of existing entertainment train operations. We intend to finance these expenses with further issuances of securities, and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet short-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.


GOING CONCERN


As a result of our net loss from operations, net cash used in operations, deficit accumulated as of June 30, 2015, our ability to continue as a going concern is in substantial doubt. Our ability to continue as a going concern is subject to the ability of the Company to generate profits from operations and/or obtaining the necessary funding from outside sources.  Management’s plan to address the Company’s ability to continue as a going concern includes (i) obtaining funding from private placement sources; (ii) obtaining additional funding from the sale of the Company’s securities; and (iii) obtaining loans from shareholders as necessary, (iv) acquiring existing businesses to generate cash flow from operations.  Although management believes that it will be able to obtain the necessary funding and acquisitions to allow the Company to remain a going concern, and to pursue its acquisition strategy through the methods discussed above, there can be no assurances that such methods will prove successful.


RECENT ACCOUNTING PRONOUNCEMENTS


The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or results of its operations as reported in its financial statements


CRITICAL ACCOUNTING POLICIES AND ESTIMATES


The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of expenses during the reported periods. We also have other key accounting policies, which involve the use of estimates, judgments and assumptions that are significant to understanding our results, which are described in Note 1 to our condensed financial statements appearing elsewhere in this report.




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OFF-BALANCE SHEET ARRANGEMENTS


As of the date of this report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.


ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.


As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.


ITEM 4.

CONTROLS AND PROCEDURES.


Evaluation of Disclosure 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 Securities Exchange Act of 1934 (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 June 30, 2015. Based on that evaluation, our management concluded that our disclosure controls and procedures were 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 Control over Financial Reporting. There have been no changes in our internal control over financial reporting during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.




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PART II - OTHER INFORMATION


ITEM 1.

LEGAL PROCEEDINGS.


Management is not aware of any legal proceedings contemplated by any governmental authority or any other party involving us or our properties. As of the date of this Quarterly Report, no director, officer or affiliate is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceedings. Management is not aware of any other legal proceedings pending or that have been threatened against us or our properties.


ITEM 1A.

RISK FACTORS.


As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.


ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.


Effective August 12, 2015, the Company issued 14,900,000 shares of its common stock to the Turnkey shareholders in connection with its acquisition of Turnkey. The shares were not registered and were issued in a transaction which was exempt from the registration requirements pursuant to Section 4(a)(2) of the Securities Act of 1933. Each of the Turnkey shareholders were accredited investors and no underwriters or placement agents were involved.


ITEM 3.

DEFAULTS UPON SENIOR SECURITIES.


None.


ITEM 4.

MINES SAFETY DISCLOSURES.


Not applicable to our Company.


ITEM 5.

OTHER INFORMATION.


On July 7, 2015, the Company filed form 8-K with the SEC disclosing an agreement between the Company, Turnkey Home Buyers USA, Inc., each of the Turnkey shareholders, TBG Holdings Corporation and Train Travel Holdings, Inc., a Florida corporation.  Pursuant to Item 1.01 of Form 8-K, the Company is including as Exhibit 10.1 to this current report the following:


(a)

Agreement dated June 19, 2015.


ITEM 6.

EXHIBITS.


Exhibits:


No.

     

Description

10.1

 

Agreement between the Company, Turnkey Home Buyers USA, Inc., TBG Holdings Corporation, each of Turnkey shareholders, and Train Travel Holdings, Inc., a Florida corporation (incorporated by reference from exhibit 10.1 to Form 8-K filed on July 7, 2015)

31.1

  

Rule 13a-14(a)/ 15d-14(a) Certification of Chief Executive Officer *

31.2

  

Rule 13a-14(a)/ 15d-14(a) Certification of Chief Financial Officer *

32.1

  

Section 1350 Certification of Chief Executive Officer and Chief Financial Officer*

101.INS

  

XBRL Instance Document *

101.PRE

  

XBRL Taxonomy Extension Presentation Linkbase *

101.LAE

  

XBRL Taxonomy Extension Label Linkbase *

101.DEF

  

XBRL Taxonomy Extension Definition Linkbase *

101.SCH

  

XBRL Taxonomy Extension Schema *

101.CAL

  

XBRL Taxonomy Extension Calculation Linkbase *

———————

* 

filed herewith

 



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SIGNATURES


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


 

Train Travel Holdings, Inc.

 

 

 

Dated: August 14, 2015

By:

/s/ Timothy S. Hart

 

 

Timothy S. Hart

 

 

Chief Financial Officer, principal financial and accounting officer

 

 

 

 

 

 

Dated: August 14, 2015

By:

/s/ Neil Swartz

 

 

Neil Swartz

 

 

Chief Executive Officer, principal executive officer










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