Amended Current Report Filing (8-k/a)

 

  

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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FORM 8-K/A

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CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  July 7, 2015

^{______________}

Train Travel Holdings, Inc.

(Exact name of registrant as specified in its charter)

^{______________}

Nevada	333-186282	33-1225521
(State or Other Jurisdiction	(Commission	(I.R.S. Employer
of Incorporation)	File Number)	Identification No.)

2929 E. Commercial Blvd., PH-D, Ft. Lauderdale, FL 33308

(Address of Principal Executive Office) (Zip Code)

954-202-9770

(Registrant’s telephone number, including area code)

Not Applicable

 (Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

  

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Explanatory Note

On July 7, 2015, Train Travel Holdings, Inc. (the “Company”) filed a Current Report on Form 8-K (the “Original Report”) disclosing the completion of the Share Exchange Agreement with Turnkey Home Buyers USA, Inc. (“Turnkey”). By this Amendment No. 1 to the Original Report, the Company is providing the required financial statements and pro forma financial information. This Current Report on Form 8-K does not amend or modify the Original Report, except as to Item 9.01.

Item 9.01 – Financial Statements and Exhibits

(a)

Financial Statements of Business Acquired.

The audited balance sheets, statements of operations, statements of changes in stockholders’ equity, statements of cash flows, and the notes thereto of Turnkey as of and for the period from September 12, 2014 (Inception) through December 31, 2014 and the related independent auditors report of Baum & Company, P.A. are filed as Exhibit 99.1 to this Current Report on Form 8-K/A and are incorporated herein by reference.

The interim balance sheets, statements of operations, statements of cash flows, and the notes thereto of Turnkey as of and for the three and six months ended June 30, 2015 and 2014 are filed as Exhibit 99.2 to this Current Report on Form 8-K/A and are incorporated herein by reference.

(b)

Pro forma Financial Information.

The required unaudited pro forma condensed consolidated financial statements as of and for the six months ended June 30, 2015 and year ended December 31, 2014 are filed as Exhibit 99.3 to this Current Report on Form 8-K/A and are incorporated herein by reference.

(d)  

Exhibits

Exhibit

Number

Description

23.1*

Consent of Independent Registered Public Accounting Firm

99.1*

Audited financial statements and notes for Turnkey Home Buyers USA, Inc.

99.2*

Interim financial statements and notes for Turnkey Home Buyers USA, Inc.

99.3*

Pro forma financial information

* Filed herewith

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

Date:  November 16, 2015	Train Travel Holdings, Inc.
	By:	/s/ Neil Swartz
		Neil Swartz President and Chief Executive Officer

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Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

Train Travel Holdings, Inc.

2929 East Commercial Blvd, Suite Ph-D

Fort Lauderdale, FL

We hereby consent to the incorporation by reference in Form 8-K/A of Train Travel Holdings, Inc. of our report dated November 9, 2015, relating to the financial statements which appear in this Form 8-K/A.

/s/ Baum & Company, P.A.

Baum & Company, P.A.

November 9, 2015

 

Exhibit 99.1

TURNKEY HOME BUYERS USA, INC.

AUDITED FINANCIAL STATEMENTS

FOR THE PERIOD FROM

SEPTEMBER 12 (INCEPTION)

TO DECEMBER 31, 2014

CONTENTS

	PAGE
Report of Independent Registered Public Accounting Firm	1
Balance Sheets	2
Statements of Operations	3
Statement of Stockholders’ Equity	4
Statements of Cash Flows	5
Notes to the Financial Statements	6

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BAUM & COMPANY, P.A.

Certified Public Accountants

1688 Meridian Avenue, Suite 504

Miami Beach, Florida 33139

( 954 ) 752-1712

Report of Independent Registered Public Accounting Firm

 

To the Board of Directors of

Turnkey Home Buyers USA, Inc.

Fort Lauderdale, Florida 33139

We have audited the accompanying balance sheet of Turnkey Home Buyers USA, Inc. (A Nevada Corporation) (the “Company”) as of December 31, 2014, and the related statements of operations, stockholders’ equity, and cash flows for the period from September 12, 2014 (Inception) through December 31, 2014. Management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.

 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

 

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Turnkey Home Buyers USA, Inc. as of December 31, 2014, and the results of its operations and its cash flows for the period from September 12, 2014 (Inception) through December 31, 2014 in conformity with accounting principles generally accepted in the United States of America.

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has suffered recurring losses from operations and has a significant amount of accumulated deficit that raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

/s/ Baum & Company PA

Miami Beach, FL

November 9, 2015

1

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Turnkey Home Buyers USA, Inc.

Balance Sheets

		December 31, 2014
Assets
Cash		$	103,324
Real estate owned			51,363
Due from related parties			227,100
Prepaid insurance			1,328
Total assets		$	383,115
Liabilities and Stockholders' Equity
Total liabilities			-
Stockholders' Equity
Preferred stock, no par value, 5,000,000 shares authorized; issued and outstanding, none at December 31, 2014.
Common stock, no par value 40,000,000 shares authorized; issued and outstanding, 5,002,500 at December 31, 2014.			500,250
Accumulated deficit			(117,135	)
Total stockholders' equity			383,115
Total liabilities and stockholders' equity		$	383,115

(The accompanying notes are an integral part of these financial statements)

2

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Turnkey Home Buyers USA, Inc.

Statement of Operations

For the Period From September 12, 2014 (Inception) through December 31, 2014

		September 12, 2014 (Inception) through December 31, 2014
Income
Revenue		$	-
Expenses
General and administrative			53,135
Management fees - related party			64,000
Total operating expenses			117,135
Income before (provision) benefit from income taxes			(117,135	)
(Provision) benefit from income taxes			-
Net loss		$	(117,135	)
Basic and diluted loss per common share		$	(0.19	)
Weighted average common shares outstanding			617,357

(The accompanying notes are an integral part of these financial statements)

3

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Turnkey Home Buyers USA, Inc.

Statement of Stockholders' Equity

For the Period From September 12, 2014 (Inception) through December 31, 2014

														Total
		Common Stock								Accumulated				Stockholders'
		Shares				Amount				Deficit				Equity
Balance, December 31, 2013			-			$	-			$	-			$	-
Sale of common stock			5,002,500				500,250				-				500,250
Net Income (Loss)			-				-				(117,135	)			(117,135	)
Balance, December 31, 2014			5,002,500			$	500,250			$	(117,135	)		$	383,115

(The accompanying notes are an integral part of these financial statements)

4

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Turnkey Home Buyers USA, Inc.

Statements of Cash Flows

For the Period From September 12, 2014 (Inception) through December 31, 2014

		September 12, 2014 (Inception) through December 31, 2014
Cash flows from operating activities:
Net loss		$	(117,135	)
Adjustments to reconcile net loss to net cash provided (used in) operating activities:
Changes in assets and liabilities:
(Increase) decrease in prepaid management fees - related party			(227,100	)
(Increase) decrease in prepaid expenses			(1,328	)
Net cash provided by (used) in operating activities			(345,563	)
Cash flows from investing activities:
Additions to real estate			(51,363	)
Net cash provided by (used) in investing activities			(51,363	)
Cash flows from financing activities:
Proceeds from the sale of common stock			500,250
Net cash provided by (used) in financing activities			500,250
Increase (decrease) in cash			103,324
Cash and cash equivalents at beginning of period			-
Cash and cash equivalents at end of period		$	103,324
Supplemental disclosures of cash flow information
Cash paid during the year for:
Taxes paid		$	-
Interest paid		$	-

(The accompanying notes are an integral part of these financial statements)

5

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TURNKEY HOME BUYERS USA, INC.

NOTES TO AUDITED FINANCIAL STATEMENTS

FOR THE PERIOD FROM SEPTEMBER 12, 2014 (INCEPTION)

THROUGH DECEMBER 31, 2014

Note 1 - Organization and Nature of Operations

Turnkey Home Buyers USA, Inc. (“Turnkey”, the “Company”) was incorporated on September 12, 2014 in Nevada. Turnkey offers clients a full suite of services for residential and commercial real estate transactions including, 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.

Note 2 – Going Concern

 

As reflected in the accompanying financial statements, from the period September 12, 2014 (Inception) through December 31, 2014, the Company had a net loss of $117,135, used $345,563 of cash in operations and had a stockholders’ deficit of $117,135.

The Company has yet to generate revenue. Since inception, the Company has funded its short falls through related party advances and sales of common stock. The Company's future operations are dependent upon its ability to increase revenues along with additional external funding as needed.

There can be no assurance that the Company will be successful in its efforts and this raises substantial doubt about the Company’s future. Should the Company be unable to obtain adequate financing or generate sufficient revenue in the future, the Company’s business, results of operations, liquidity and financial condition would be materially and adversely harmed, and may not be able to continue as a going concern.

Note 3 - Summary of Significant Accounting Policies

The financial statements of Turnkey have been prepared in accordance with the generally accepted accounting principles (GAAP) in the United States of America. The financial statements have, in management’s opinion been properly prepared within reasonable limits of materiality and within the framework of the significant accounting policies summarized below:

Basis of presentation

Turnkey’s financial statements are prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

 

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate could change in the near term due to one or more future non-conforming events. Accordingly, the actual results could differ significantly from estimates.

Fair Value Measurement

The Company measures fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The Company utilizes a three-tier hierarchy which prioritizes the inputs used in the valuation methodologies in measuring fair value:

Level 1. Valuations based on quoted prices in active markets for identical assets or liabilities that an entity has the ability to access. The Company has no assets or liabilities valued with Level 1 inputs.

6

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Level 2. Valuations based on quoted prices for similar assets or liabilities, quoted prices for identical assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. The Company has no assets or liabilities valued with Level 2 inputs.

Level 3. Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company has no assets or liabilities valued with Level 3 inputs.

Fair Value of Financial Instruments

The carrying value of cash and cash equivalents, accounts payable and accrued liabilities approximate their fair value because of the short-term nature of these instruments and their liquidity. It is not practical to determine the fair value of our notes payable due to the complex terms. Management is of the opinion that the Company is not exposed to significant interest or credit risks arising from these financial instruments.

Segment Reporting

The Company’s business is considered to be operating in one segment based upon the Company’s organizational structure, the way in which the operations are managed and evaluated, the availability of separate financial results and materiality considerations.

Cash and Cash Equivalents

 

The Company considers all highly liquid instruments purchased with an original maturity of three months or less and money market accounts to be cash equivalents.

Real Estate Owned and Held-For-Sale

Real estate owned, shown net of accumulated depreciation and impairment charges, is comprised of real property acquired for cash or through partial or full settlement of mortgage debt. Real estate acquired is recorded at its estimated fair value at the time of acquisition.

We allocate the purchase price of our operating properties to land and building and to any other identified intangible assets or liabilities. We finalize our purchase price allocation on these assets within one year of the acquisition date.

Real estate assets are depreciated using the straight-line method over their estimated useful lives. Ordinary repairs and maintenance which are not reimbursed by the tenants are expensed as incurred. Major replacements and betterments which improve or extend the life of the asset are capitalized and depreciated over their estimated useful life.

Our properties are individually reviewed for impairment each quarter, if events or circumstances change indicating that the carrying amount of the assets may not be recoverable. We recognize impairment if the undiscounted estimated cash flows to be generated by the assets are less than the carrying amount of those assets. Measurement of impairment is based upon the estimated fair value of the asset. In the evaluation of a property for impairment, many factors are considered, including estimated current and expected operating cash flows from the property during the projected holding period, costs necessary to extend the life or improve the asset, expected capitalization rates, projected stabilized net operating income, selling costs, and the ability to hold and dispose of such real estate owned in the ordinary course of business. Impairment charges may be necessary in the event discount rates, capitalization rates, lease-up periods, future economic conditions, and other relevant factors vary significantly from those assumed in valuing the property.

Real estate is classified as held-for-sale when management commits to a plan of sale, the asset is available for immediate sale, there is an active program to locate a buyer, and it is probable the sale will be completed within one year. Real estate assets that are expected to be disposed of are valued, on an individual asset basis, at the lower of their carrying amount or their fair value less costs to sell.

We recognize sales of real estate properties upon closing. Payments received from purchasers prior to closing are recorded as deposits. Gain on real estate sold is recognized using the full accrual method when the collectability of the sale price is reasonably assured and we are not obligated to perform significant activities after the sale. Gain may be deferred in whole or in part until collectability of the sales price is reasonably assured and the earnings process is complete.

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Income Taxes

The Company accounts for income taxes using the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributed to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credits and loss carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and carry-forwards are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established when necessary to reduce deferred tax assets to amounts expected to be realized. The Company reports a liability for unrecognized tax benefits resulting from uncertain income tax positions, if any, taken or expected to be taken in an income tax return. Estimated interest and penalties are recorded as a component of interest expense or other expense, respectively.

Revenue Recognition

We anticipate earning income from the operations of residential real estate properties classified as real estate owned. We recognize revenue for these activities when the fees are fixed or determinable, or are evidenced by an arrangement, collection is reasonably assured and the services under the arrangement have been provided.

Advertising and Marketing

The Company's policy is to expense advertising and marketing costs as incurred. The Company did not recognize any advertising expense during the period September 12, 2014 (Inception) through December 31, 2014.

Recent Accounting Pronouncements

In September 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-16, Business Combinations (Topic 805). This ASU eliminates the requirement for retrospective application of measurement period adjustments relating to provisional amounts recorded in a business combination as of the acquisition date. The amendments in this update require an entity to present separately on the face of the income statement or disclose in the notes the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. For public business entities, the amendments will be effective for fiscal years beginning after December 15, 2015. Early adoption is permitted. The Company does not expect this accounting update to have a material effect on its consolidated financial statements in future periods, although that could change.

In April 2015, the FASB issued ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This ASU requires retrospective adoption and will be effective for fiscal years beginning after December 15, 2015 and for interim periods within those fiscal years. We expect the adoption of this guidance will not have a material impact on our financial statements.

In February 2015, the FASB issued ASU 2015-02, “Amendments to the Consolidation Analysis”, which amends the consolidation requirements in ASC 810 and significantly changes the consolidation analysis required under U.S. GAAP relating to whether or not to consolidate certain legal entities. Early adoption is permitted. The Company’s effective date for adoption is January 1, 2016. The Company does not expect this accounting update to have a material effect on its consolidated financial statements in future periods, although that could change.

 

In January 2015, the FASB issued ASU 2015-01, “Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items”, which eliminates the concept from U.S. GAAP the concept of an extraordinary item. Under the ASU, an entity will no longer (1) segregate an extraordinary item from the results of ordinary operations; (2) separately present an extraordinary item on its income statement, net of tax, after income from continuing operations; or (3) disclose income taxes and earnings-per-share data applicable to an extraordinary item. Early adoption is permitted. The Company’s effective date for adoption is January 1, 2016. The Company does not expect this accounting update to have a material effect on its consolidated financial statements in future periods, although that could change.

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In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205 40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which is intended to define management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. Specifically, ASU 2014-15 provides a definition of the term substantial doubt and requires an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). It also requires certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans and requires an express statement and other disclosures when substantial doubt is not alleviated. The new standard will be effective for reporting periods beginning after December 15, 2016, with early adoption permitted. Management does not expect the adoption of ASU 2014-15 to have a material impact on our financial statements and disclosures.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (ASU 2014-09), which supersedes most existing revenue recognition guidance under US GAAP. The core principle of ASU 2014-09 is to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. ASU 2014-09 defines a five step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. The standard is effective for annual periods beginning after December 15, 2016, and interim periods therein, using either of the following transition methods: (i) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of initially adopting ASU 2014-09 recognized at the date of adoption (which includes additional footnote disclosures). On July 9, 2015, the FASB voted to defer the effective date of the new revenue recognition standard by one year. Based on the Board's decision, public organizations would apply the new revenue standard to annual reporting periods beginning after December 15, 2017. We are currently evaluating the impact of the pending adoption of ASU 2014-09 on our consolidated financial statements and have not yet determined the method by which we will adopt the standard.

We review new accounting standards as issued. Although some of these accounting standards issued or effective after the end of our previous fiscal year may be applicable to us, we have not identified any standards that we believe merit further discussion. We believe that none of the new standards will have a significant impact on our financial statements.

Note 4 – Due From Related Parties

Due from related parties represents noninterest bearing advances to certain related parties primarily related to the advance payment of management fees.

Note 7 – Related Party Transactions

During the period from September 12, 2014 through December 31, 2014, the Company recognized related party management fees totaling $64,000.

Note 8 – Subsequent Events

On July 6, 2015, Train Travel Holdings, Inc., a Nevada corporation (“TTHX”) completed a Share Exchange Agreement (the “Agreement”) with Turnkey Home Buyers USA, Inc., a Florida corporation (“Turnkey”), TBG Holdings Corporation, a Florida corporation (“TBG”), each of the Turnkey shareholders (the “Shareholders”), and Train Travel Holdings, Inc., a Florida corporation (“TTH”).

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 Turnkey shares, TTHX transferred 15,337,500 shares of 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. Robert Blair, a principal of Turnkey, was a TBG shareholder.

In January 2015, the Company purchased a residential property for $36,000. From January 2015 through August 2015, the Company made improvements to the property totaling approximately $27,011. On October 9, 2015, the Company sold the property for net proceeds of $63,279 resulting in a gain on the disposition of the property of $286.

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Exhibit 99.2

TURNKEY HOME BUYERS USA, INC.

INTERIM FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTHS ENDED

JUNE 30, 2015

CONTENTS

	PAGE
Balance Sheets	1
Statements of Operations	2
Statement of Stockholders’ Equity	3
Statements of Cash Flows	4
Notes to the Financial Statements	5

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Turnkey Home Buyers USA, Inc.

Balance Sheets

		June 30, 2015				December 31, 2014
Assets
Cash		$	29,347			$	103,324
Real estate owned			114,169				51,363
Due from related parties			231,000				227,100
Prepaid insurance			-				1,328
Total assets		$	374,516			$	383,115
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable & accrued expenses		$	7,673			$	-
Total Current Liabilities			7,673				-
Total liabilities			7,673				-
Stockholders' Equity
Preferred stock, no par value, 5,000,000 shares authorized; issued and outstanding, none at December 31, 2014.
Common stock, no par value 40,000,000 shares authorized; issued and outstanding, 8,960,000 and 5,002,500 at June 30, 2015 and December 31, 2014, respectively.			800,600				500,250
Accumulated deficit			(433,757	)			(117,135	)
Total stockholders' equity			366,843				383,115
Total liabilities and stockholders' Equity		$	374,516			$	383,115

(The accompanying notes are an integral part of these financial statements)

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Turnkey Home Buyers USA, Inc.

Statements of Operations

For the Three and Six Months Ended June 30, 2015

		Three Months Ended June 30, 2015				Six Months Ended June 30, 2015
Income
Revenue		$	-			$	2,698
Expenses
General and administrative			95,153				228,884
Management fees - related party			57,540				90,436
Total operating expenses			152,693				319,320
Income before (provision) benefit from income taxes			(152,693	)			(316,622	)
(Provision) benefit from income taxes			-				-
Net loss		$	(152,693	)		$	(316,622	)
Basic and diluted loss per common share		$	(0.02	)		$	(0.04	)
Weighted average common shares outstanding			8,470,102				7,622,268

(The accompanying notes are an integral part of these financial statements)

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Turnkey Home Buyers USA, Inc.

Statement of Stockholders' Equity

For the Six Months Ended June 30, 2015 and the Period From September 12, 2014 (Inception) through December 31, 2014

														Total
		Common Stock								Accumulated				Stockholders'
		Shares				Amount				Deficit				Equity
Balance, December 31, 2013			-			$	-			$	-			$	-
Sale of common stock			5,002,500				500,250				-				500,250
Net Income (Loss)			-				-				(117,135	)			(117,135	)
Balance, December 31, 2014			5,002,500				500,250				(117,135	)			383,115
Sale of common stock			3,170,000				300,350				-				300,350
Net Income (Loss)			-				-				(316,622	)			(316,622	)
Balance, June 30, 2015			8,172,500			$	800,600			$	(433,757	)		$	366,843

(The accompanying notes are an integral part of these financial statements)

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Turnkey Home Buyers USA, Inc.

Statements of Cash Flows

For the Six Months Ended June 30, 2015

Cash flows from operating activities:
Net loss		$	(316,622	)
Adjustments to reconcile net loss to net cash provided (used in) operating activities:
Changes in assets and liabilities:
(Increase) decrease in prepaid management fees - related party			(3,900	)
(Increase) decrease in prepaid expenses			1,328
Increase (decrease) in accounts payable and accrued expenses			7,673
Net cash provided by (used) in operating activities			(311,521	)
Cash flows from investing activities:
Additions to real estate			(62,806	)
Net cash provided by (used) in investing activities			(62,806	)
Cash flows from financing activities:
Proceeds from the sale of common stock			300,350
Net cash provided by (used) in financing activities			300,350
Increase (decrease) in cash			(73,977	)
Cash and cash equivalents at beginning of period			103,324
Cash and cash equivalents at end of period		$	29,347
Supplemental disclosures of cash flow information
Cash paid during the year for:
Taxes paid		$	-
Interest paid		$	-

(The accompanying notes are an integral part of these financial statements)

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TURNKEY HOME BUYERS USA, INC.

NOTES TO UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2015

Note 1 - Organization and Nature of Operations

Turnkey Home Buyers USA, Inc. (“Turnkey”, the “Company”) was incorporated on September 12, 2014 in Nevada. Turnkey offers clients a full suite of services for residential and commercial real estate transactions including, 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.

Note 2 – Going Concern

 

As reflected in the accompanying financial statements, during the six months ended June 30, 2015, the Company had a net loss of $316,622 and used $311,521 of cash in operations and had a stockholders’ deficit of $433,757.

The Company has yet to generate revenue. Since inception, the Company has funded its short falls through related party advances and sales of common stock. The Company's future operations are dependent upon its ability to increase revenues along with additional external funding as needed.

There can be no assurance that the Company will be successful in its efforts and this raises substantial doubt about the Company’s future. Should the Company be unable to obtain adequate financing or generate sufficient revenue in the future, the Company’s business, results of operations, liquidity and financial condition would be materially and adversely harmed, and may not be able to continue as a going concern.

Note 3 – Real Estate Owned

During the six months ended June 30, 2015, the Company purchased a residential property and made improvements resulting in a $62,806 increase in the carry value of real estate owned and bringing the total properties owned to two.

Note 4 – Due From Related Parties

Due from related parties represents noninterest bearing advances to certain related parties primarily related to the advance payment of management fees.

Note 5 – Related Party Transactions

During the three and six months ended June 30, 2015, the Company paid $57,540 and $90,436, respectively, in fees for accounting and other consulting work to related parties. During the period from September 12, 2014 through December 31, 2014, the Company recognized related party fees totaling $64,000.

Note 6 – Subsequent Events

On July 6, 2015, Train Travel Holdings, Inc., a Nevada corporation (“TTHX”) completed a Share Exchange Agreement (the “Agreement”) with Turnkey Home Buyers USA, Inc., a Florida corporation (“Turnkey”), TBG Holdings Corporation, a Florida corporation (“TBG”), each of the Turnkey shareholders (the “Shareholders”), and Train Travel Holdings, Inc., a Florida corporation (“TTH”).

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 Turnkey shares, TTHX transferred 15,337,500 shares of 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. Robert Blair, a principal of Turnkey, was a TBG shareholder.

In January 2015, the Company purchased a residential property for $36,000. From January 2015 through August 2015, the Company made improvements to the property totaling approximately $27,011. On October 9, 2015, the Company sold the property for net proceeds of $63,279 resulting in a gain on the disposition of the property of $286.

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Exhibit 99.3

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Description of Pro Forma Transactions

Turnkey Home Buyers USA, Inc. Acquisition

On July 6, 2015 (“Acquisition Date”), Train Travel Holdings, Inc., a Nevada corporation (“TTHX”) completed a Share Exchange Agreement (the “Agreement”) with Turnkey Home Buyers USA, Inc., a Florida corporation (“Turnkey”), TBG Holdings Corporation, a Florida corporation (“TBG”), each of the Turnkey shareholders (the “Shareholders”), and Train Travel Holdings, Inc., a Florida corporation (“TTH”).

Prior to the Agreement, Turnkey shareholders held 24,675,000 shares of common stock (the “Turnkey Shares”) of which 15,000,000, or 60.8%, was owned by TBG (the “TBG Shares”) whose officers and majority shareholders are Neil Swartz and Timothy Hart. TTHX total capital stock outstanding included 23,391,665 shares of common stock and 600,000 shares of preferred stock convertible into 29,100,000 shares of common stock. Beneficial ownership of 75.2% of the TTHX capital stock resided with Mr. Swartz and Mr. Hart through their control of TBG and individual ownership of 100% of the issued and outstanding preferred stock.

Pursuant to the terms of the Agreement, TBG tendered to Turnkey for cancellation 15,000,000 shares of Turnkey common stock resulting in Turnkey shareholders transferring to TTHX all of the issued and outstanding shares of capital stock of Turnkey’s shareholders which amounted to 9,675,000 shares (24,675,000 Turnkey Shares – 15,000,000 TBG Shares).

Pursuant to the terms of the Agreement, in exchange for the Turnkey shares, TTHX was to transfer 15,037,500 shares of common stock to Turnkey shareholders, but ultimately issued 15,337,500 shares.

As a result of the Share Exchange, the Turnkey shareholders own 38.9% of TTHX common stock issued and outstanding and 22.1% of the fully diluted common stock outstanding. TBG, Mr. Swartz and Mr. Hart combined own 27.0% of TTHX common stock issued and outstanding and beneficially own 58.5% of the fully diluted common stock as a result of their ownership of the outstanding preferred stock.

Due to the common control of Turnkey and TTHX, pursuant to ASC 805-50-25, “Transactions Between Entities Under Common Control” and other SEC guidance including for lack of economic substance, the Agreement was accounted for as a transfer of the carrying amounts of assets and liabilities under the predecessor value method of accounting.

Turnkey was founded in September 2014 by TBG and Robert and Joseph Blair and offers clients a full suite of services for residential and commercial real estate transactions. As part of the acquisition, TTHX 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. Turnkey Home Buyers USA Inc. will be run as a subsidiary of Train Travel Holdings Inc. Following the closing TTHX will have two operating divisions: (1) the new Turnkey Home Buyers real estate operations and (2) the Train Travel railroad operation, which is looking for acquisition in the excursion railroad industry.

  

The unaudited pro forma condensed consolidated financial statements do not include any adjustments regarding liabilities incurred or cost savings achieved resulting from the integration of the companies, as management is in the process of assessing what, if any, future actions are necessary. The unaudited pro forma condensed consolidated financial statements are not intended to represent or be indicative of the consolidated results of operations or financial condition of the Company that would have been reported had the Agreement been completed as of the dates presented, and should not be construed as representative of the future consolidated results of operations or financial condition of the combined entity.

The unaudited pro forma condensed consolidated financial statements should be read in conjunction with (i) the historical audited and unaudited financial statements and related notes of the Company and the sections entitled Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014, filed on April 20, 2015; (ii) the audited historical financial statements and related notes of Turnkey Home Buyers USA, Inc. as of December 31, 2014 and for the period from September 12, 2014 through December 31, 2014 and filed herewith as exhibit 99.1

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Train Travel Holdings, Inc.

Unaudited Pro Forma Condensed Consolidated Statements of Operations

For the Three and Six months Ended June 30, 2015

		Three Months Ended June 30, 2015												Six Months Ended June 30, 2015
										Total												Total
						Turnkey Home				Pro Forma								Turnkey Home				Pro Forma
		Train Travel				Buyers				Three Months				Train Travel				Buyers				Three Months
		Holdings, Inc.				USA, Inc.				Ended				Holdings, Inc.				USA, Inc.				Ended
		Actual				Actual				June 30, 2015				Actual				Actual				June 30, 2015
Income
Revenue		$	-			$	-			$	-			$	-			$	2,698			$	2,698
Expenses
General and administrative			5,573				95,153				100,726				8,779				228,884				237,663
Legal and professional - related party			16,758				57,540				74,298				29,671				90,436				120,107
Legal and professional			13,267				-				13,267				14,367				-				14,367
Total operating expenses			35,598				152,693				188,291				52,817				319,320				372,137
Income before (provision) benefit from income taxes			(35,598	)			(152,693	)			(188,291	)			(52,817	)			(316,622	)			(369,439	)
(Provision) benefit from income taxes			-				-				-				-				-				-
Net loss		$	(35,598	)		$	(152,693	)		$	(188,291	)		$	(52,817	)		$	(316,622	)		$	(369,439	)
Shares outstanding:
Common stock outstanding - basic & diluted			23,391,665								23,391,665				23,391,665								23,391,665
Common stock issued in share exchange							15,337,500				15,337,500								15,337,500				15,337,500
Total common shares outstanding - basic & diluted											38,729,165												38,729,165
Proforma net income (loss) per common share - basic & diluted										$	(0.005	)										$	(0.010	)

See notes to unaudited pro forma condensed consolidated financial statements

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Train Travel Holdings, Inc.

Unaudited Pro Forma Condensed Consolidated Statements of Operations

For the Year Ended December 31, 2014

						Turnkey Home
						Buyers
		Train Travel				USA, Inc.
		Holdings, Inc.				For the period				Total
		For the				September 12,				Pro Forma
		Year				2014 (Inception)				Year
		Ended				Through				Ended
		December 31,				December 31,				June 30, 2015
		2015				2015				December 31,
		Actual				Actual				2015
Income
Revenue		$	-			$	-			$	-
Expenses
General and administrative			5,573				53,135				58,708
Legal and professional - related party			16,758				64,000				80,758
Legal and professional			13,267				-				13,267
Total operating expenses			35,598				117,135				152,733
Income before (provision) benefit from income taxes			(35,598	)			(117,135	)			(152,733	)
(Provision) benefit from income taxes			-				-				-
Net loss		$	(35,598	)		$	(117,135	)		$	(152,733	)
Shares outstanding:
Common stock outstanding - basic & diluted			23,391,665								23,391,665
Common stock issued in share exchange							15,337,500				15,337,500
Total common shares outstanding - basic & diluted											38,729,165
Proforma net income (loss) per common share - basic & diluted										$	(0.004	)

See notes to unaudited pro forma condensed consolidated financial statements

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Train Travel Holdings, Inc.

Unaudited Pro Forma Condensed Consolidated Balance Sheet

As of June 30, 2015

						Turnkey Home
		Train Travel				Buyers				Share				June 30,
		Holdings, Inc.				USA, Inc.				Exchange				2015
		Actual				Actual				Adjustments				Proforma
Assets
Cash		$	-			$	29,347			$	-			$	29,347
Real estate owned			-				114,169				-				114,169
Due from related parties			-				231,000				-				231,000
Total assets		$	-			$	374,516			$	-			$	374,516
Liabilities and Stockholders' Equity (Deficit)
Current Liabilities
Accounts payable & accrued expenses		$	20,676			$	7,673			$	-			$	28,349
Accounts payable - related party			53,987				-				-				53,987
Advances - related party			230,460				-				-				230,460
Loan payable			2,194				-				-				2,194
Total Current Liabilities			307,317				7,673				-				314,990
Total liabilities			307,317				7,673				-				314,990
Stockholders' Equity (Deficit)
Preferred stock			600				-				-				600
Common stock			23,392				-				15,337				38,729
Additional paid-in capital			196,758				800,600				(15,337	)			982,021
Accumulated deficit			(528,067	)			(433,757	)			-				(961,824	)
Total stockholders' equity (deficit)			(307,317	)			366,843				-				59,526
Total liabilities and stockholders' equity (deficit)		$	-			$	374,516			$	-			$	374,516

 

 

 

(The accompanying notes are an integral part of these financial statements)

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Train Travel Holdings, Inc.

Unaudited Pro Forma Condensed Consolidated Balance Sheet

As of December 31, 2014

						Turnkey Home
		Train Travel				Buyers				Share				December 31,
		Holdings, Inc.				USA, Inc.				Exchange				2014
		Actual				Actual				Adjustments				Proforma
Assets
Cash		$	-			$	103,324			$	-			$	103,324
Real estate owned			-				51,363				-				51,363
Due from related parties			-				227,100				-				227,100
Prepaid insurance			-				1,328				-				1,328
Total assets		$	-			$	383,115			$	-			$	383,115
Liabilities and Stockholders' Equity (Deficit)
Current Liabilities
Accounts payable & accrued expenses		$	17,881			$	-			$	-			$	17,881
Accounts payable - related party			37,513				-				-				37,513
Advances - related party			196,912				-				-				196,912
Loan payable			2,194				-				-				2,194
Total Current Liabilities			254,500				-				-				254,500
Total liabilities			254,500				-				-				254,500
Stockholders' Equity (Deficit)
Preferred stock			600				-				-				600
Common stock			23,392				-				15,337				38,729
Additional paid-in capital			196,758				500,250				(15,337	)			681,671
Accumulated deficit			(475,250	)			(117,135	)			-				(592,385	)
Total stockholders' equity (deficit)			(254,500	)			383,115				-				128,615
Total liabilities and stockholders' equity (deficit)		$	-			$	383,115			$	-			$	383,115

(The accompanying notes are an integral part of these financial statements)

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NOTES TO THE UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Basis of Pro Forma Presentation

The unaudited pro forma condensed consolidated financial statements have been prepared by Train Travel Holdings, Inc. (“Train Travel” or the “Company”) pursuant to the rules and regulations of the Securities and Exchange Commission for the purposes of inclusion in Train Travel’s amended Form 8-K prepared and filed in connection with the Share Exchange Agreement.

Certain information and certain disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. However, the Company believes that the disclosures provided herein are adequate to make the information presented not misleading.

The unaudited pro forma condensed consolidated financial statements have been prepared to give effect to the Agreement and the following related transactions: the issuance of restricted common stock.

The unaudited pro forma condensed consolidated statement of operations for the year ended December 31, 2014 and the unaudited pro forma condensed consolidated statement of operations for the six months ended June 30, 2015 gives effect to the Agreement as if it occurred on January 1, 2014. The unaudited pro forma condensed consolidated statement of operations is derived from the audited historical financial statements of TTHX and Turnkey as of and for the period ended December 31, 2014 and the unaudited historical financial statements of TTHX and Turnkey as of and for the three and six months ended June 30, 2015.

The unaudited pro forma condensed consolidated financial statements are provided for informational purposes only and do not purport to be indicative of the Company’s consolidated financial position or consolidated results of operations which would actually have been obtained had such transactions been completed as of the date or for the periods presented, or of the consolidated financial position or consolidated results of operations that may be obtained in the future.

Note 2. Predecessor Values Accounting

Due to the common control of Turnkey and TTHX, pursuant to ASC 805-50-25, “Transactions Between Entities Under Common Control” and other SEC guidance including for lack of economic substance, the Agreement was accounted for as a transfer of the carrying amounts of assets and liabilities under the predecessor value method of accounting.

Financial statement presentation under the predecessor values method of accounting as a result of a business combination between entities under common control requires the receiving entity (i.e., TTHX) to report the results of operations as if both entities had always been combined. The consolidated financial statements include both entities’ full results since the inception of Turnkey on September 12, 2014.

The carry value of Turnkey assets and liabilities as of the acquisition date is as follows:

Net tangible assets acquired and liabilities assumed on July 6, 2015:

Cash and cash equivalents		$	13,337
Due from related parties			224,272
Real estate owned			114,273
Total assets acquired			353,782
Accounts payable and accrued liabilities			7,673
Net asset value			346,109

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Note 3. Pro Forma Net Loss Per Common Share

The pro forma basic and diluted net loss per common share is based on the weighted average number of shares that were outstanding during the period, including shares of common stock that are issuable at the end of the reporting period. The computation of diluted EPS is based on the number of basic weighted-average shares outstanding plus the number of common shares that would be issued assuming the exercise of all potentially dilutive common shares outstanding using the treasury stock method. The computation of diluted net income per share does not assume conversion, exercise or contingent issuance of securities that would have an antidilutive effect on earnings per share. Therefore, when calculating EPS if the Company experienced a loss, there is no inclusion of dilutive securities as their inclusion in the EPS calculation is antidilutive.

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