UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

——————— ________________

FORM 10-K

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

For the fiscal year ended December 31, 2017:2019

Global Boatworks Holdings, Inc.

(Exact name of registrant as specified in its charter)

Global Boatworks Holdings, Inc.

2637 Atlantic Blvd.#134

Pompano Beach, FL 33062

(Address of Principal Executive Office) (Zip Code)

954-934-9400

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: Common Stock

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [  ] No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes [  ] No [X]

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 [X] 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 [X] No [  ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes [  ] No [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer [  ]    Accelerated filer [  ]    Non-accelerated filer [  ]    Smaller reporting company [X]   Emerging Growth Company [X]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

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

As of March 31, 2018June 19, 2020 we had 1,581,494,0042,901,311 shares of common stock $.0001 par value outstanding.

The aggregate market value of Common Stock held by non-affiliates of the Registrant on March 31, 2020, was $313,203 based on a $0.1333 average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed fiscal quarter.

TABLE OF CONTENTS

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PART I

Throughout this Annual Report, we refer to Global Boatworks Holdings, Inc. as “we,” “us,” “our,” or “the Company.”

THIS ANNUAL REPORT ON FORM 10-K CONTAINS FORWARD-LOOKING STATEMENTS. THESE STATEMENTS RELATE TO FUTURE EVENTS OR OUR FUTURE FINANCIAL PERFORMANCE. IN SOME CASES, YOU CAN IDENTIFY FORWARD-LOOKING STATEMENTS BY STATEMENTS SUCH AS “MAY,” “WILL,” “SHOULD,” “EXPECT,” “PLAN,” “INTEND,” “ANTICIPATE,” “BELIEVE,” “ESTIMATE,” “PROJECT,” “PREDICT,” “POTENTIAL,” OR “CONTINUE,” (INCLUDING THE NEGATIVE OF SUCH TERMS), OR OTHER SIMILAR STATEMENTS. THESE STATEMENTS ARE ONLY ESTIMATIONS AND ARE BASED UPON VARIOUS ASSUMPTIONS THAT MAY NOT BE REALIZED. ACTUAL EVENTS OR RESULTS MAY DIFFER MATERIALLY. IN EVALUATING THESE STATEMENTS, YOU SHOULD SPECIFICALLY CONSIDER VARIOUS FACTORS, INCLUDING, BUT NOT LIMITED TO, THE RISKS OUTLINED BELOW UNDER THE HEADING ITEM 1A CAPTIONED “RISK FACTORS.” THESE FACTORS MAY CAUSE OUR ACTUAL RESULTS TO DIFFER MATERIALLY FROM ANY FORWARD-LOOKING STATEMENT.

ALTHOUGH WE BELIEVE THAT THE ESTIMATIONS REFLECTED IN THE FORWARD-LOOKING STATEMENTS ARE REASONABLE, WE CANNOT GUARANTEE FUTURE RESULTS, LEVELS OF ACTIVITY, PERFORMANCE OR ACHIEVEMENTS. MOREOVER, NEITHER WE NOR ANY OTHER PERSON ASSUMES RESPONSIBILITY FOR THE ACCURACY AND COMPLETENESS OF THE FORWARD-LOOKING STATEMENTS. WE DO NOT INTEND TO UPDATE ANY OF THE FORWARD-LOOKING STATEMENTS AFTER THE DATE OF THIS ANNUAL REPORT TO CONFORM SUCH STATEMENTS TO ACTUAL RESULTS OR TO CHANGES IN OUR EXPECTATIONS, UNLESS REQUIRED BY LAW.

ITEM 1. BUSINESS

Overview

We are incorporated in the state of Florida on May 11, 2015, to acquire our wholly owned subsidiary Global Boatworks, LLC, a Florida limited liability company formed on June 16, 2014, to commercialize upscale stationary vessels built on a barge bottom. We owned two (2) vessels, the Miss Leah, which we acquired from a related party on September 25, 2014, as a prototype and to operate as a short-term rental in Boston Harbor, Massachusetts which we sold in September 2017, and Luxuria I, which was completed in June 2017and is being held for rental and sale.

On May 11, 2015, we issued an aggregate of 6,130,0006,130 shares of our common stock to the owners of Global Boatworks, LLC for one hundred (100%) of its outstanding membership interests.

As a result of our acquisition of Global Boatworks, LLC:

On December 14, 2018 we effected a 1 for 1,000 reverse split of our common stock, which is reflected throughout this filing.

·

Global Boatworks, LLC became our wholly owned subsidiary,

·

The officers and directors of Global Boatworks, LLC became our officers and directors,

·

The shareholders of Global Boatworks, LLC became our shareholders, and

·

The operations of Global Boatworks, LLC became our operations.

Our principal executive office is located at 2637 Atlantic Blvd, #134, Pompano Beach, Florida 33062. Our telephone number is 954-934-9400. Our website is www.globalboatworks.com.

Our auditors have included a “going concern” explanatory paragraph in their audit opinion and we have included a going concern discussion in our financial statement footnotes, meaning that we face uncertainties that our business will not succeed or be viable. Additionally, it is likely that we will need additional capital or additional financing in the future, and if such financing is not available to us on acceptable terms our business may suffer or fail as a result.

Operations

We plan to generate revenues from the rental and sale of our vessels. We currently have one vessel docked in South Florida that is for sale and is also available for rental. During the fiscal year 2017, the Company sold a company-owned vessel known as the Miss Leah that was located in Boston Harbor, Massachusetts. That vessel had been previously available for rental as well.rental. In 2019, we sold the first Luxuria-class vessel, the Luxuria I. The Luxuria had also been available for rental.

For the years ended December 31, 2016,2019, and December 31, 2017,2018, we had a net loss of $1,281,483$34,886 and $ 3,042,629$1,305,925 respectively. For the years ended December 31, 2016,2019, and December 31, 2017,2018, we had revenues of $37,072$750,000 and $256,992$15,550 respectively. Revenues in 20162019 were from sale of the Luxuria I, and in 2018 revenues were from short term rentals of our vessel in Boston Harbor, Massachusetts, and in 2017 included rentals of both vessels and the sale of the Miss Leah.Luxuria I.

Our operations to date and those of Global Boatworks, LLC, our wholly owned subsidiary include:

·

development of our business plan;

·

acquisition of our company owned vessel, the Miss Leah;

·

locating designers for our Luxuria models;

·

completing the design of our Luxuria models;

·

identifying amenities to be offered with the Luxuria models;

·

construction of the Luxuria I vessel;

·

developing and implementing marketing strategies;

·

marketing the short-term rental of the Miss Leah and Luxuria I on Home Away and Vacation Rentals By Owner (VRBO); and

·

renting the Miss Leah and Luxuria I on a short-term basis as a vacation rental.

Our Company Owned Vessels

On September 25, 2014, we purchased the Miss Leah from a related party. We use dused the Miss Leah as a short-term rental property to generate revenue and demonstrate the upscale vessels we plan to offer.

The Miss Leah was built in 2004 and fully renovated in 2011. The Miss Leah is a two (2) story vessel which is one thousand five hundred (1,500) square feet under air, two (2) bedrooms, two (2) bathrooms, wood floors throughout, granite countertops, contemporary stainless steel appliances and a fireplace. Until the time of its sale The Miss Leah was docked at Marina Bay in Boston, Massachusetts. Until the sale of the Miss Leah in September 2017, it was available for rent on a short-term basis for between $200 and $400 per night.

Luxuria Model

We plan to sell an upscale floating vessel known as the Luxuria model. We own the design but were assisted in our design of the Luxuria model by Carlos Vilaca & Associates and Double P Construction, Inc., who have decades of experience in South Florida design and construction.

Our Luxuria model takes between five (5) to seven (7) months to build and is approximately one thousand six hundred and fifty (1,650) square feet under air. The Luxuria model is designed to reflect South Florida’s modern style. Luxuria can be equipped with either single or twin outboard motors and areis intended to be docked. The Luxuria model will featurefeatures wood floors, marble countertops, modern stainless steel appliances and other upscale amenities.

We expect the Luxuria class vessel will retail for approximately from $1,200,000 to $1,500,000 depending upon the amenities and specifications selected.

We have constructed the first of the Luxuria class, the Luxuria I, that iswhich was currently docked in South Florida and iswas available for short term rental and for sale.until its sale in April 2019.

Distribution

We plan to distributesell the Luxuria vessels through direct company sales to customers, boat dealerships, yacht brokers and real estate brokers.

Manufacturing

We do not have a written agreement with any manufacturer obligating them to manufacture our vessels. In the process of constructing Luxuria I we have found that there are suitable manufacturers who will be available on commercially reasonable terms as subcontractors to us.

Upon completion of manufacturing, we plan to dock our vessels in Fort Lauderdale, Florida. We believe there are numerous marinas with dockage available on commercially reasonable terms.

Revenues

We generated revenue from the rental of Miss Leah until it was sold and will generate revenues from the rental and sale of completedthe Luxuria model vessels.I. Upon completion of a Luxuria-class vessel, it has beenmay be used as a short-term vacation rental until sold. We plan to dock the completed

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vessels at Bahia Mar Marina in Fort Lauderdale, Florida, where the vessel can be viewed and rented at a rate of approximately $1,000 per night, until sold.

The Company has pledged the Miss Leah and Luxuria I and future Luxuria II vessels as security for the repayment of certain notes. Therefore, the proceeds of such sales will first go to the repayment of the secured indebtedness.

Target Customers

Our target customers are owners of marinas and other businesses and individuals seeking unique rental properties for their customers, corporations seeking a unique venue for company events and functions, persons seeking a vacation or second home on the water and individuals seeking to live on a floating vessel with the amenities commonly found in a home.

Marketing

We have implemented a marketing strategy. Primarily, partPart of our sales and marketing efforts will be to participate in boat shows and sales events at South Florida boating locations, typically held in January, February and March of each year. These shows and events are normally held at convention centers or marinas, with area boat distributors and dealers renting space and displaying product information for consumers. Boat shows and other offsite promotions will be an important venue for generating sales.

We believe that a marketing strategy focused on boat shows and related events, social media, print advertising and internet advertising will provide potential customers with the opportunity to view our information about our vessels, which is an optimal strategy to increase sales.

We market our rentals through Homeaway, and Vacation Rentals By Owner (VRBO). and AirBnB. The Luxuria I is currentlyhad been listed with a South Florida yacht brokerage and with a South Florida real property brokerage.

Property

The Company occupiesformerly occupied dockage space for the Luxuria I pursuant to an agreement with Bahia Mar Marina Bay, LLC dated May 1, 2017.2018. We paypaid annual rents of approximately $55,000. This agreement was mutually terminated in October 2018. After the sale of the Luxuria I we do not have a need to for dock space until we build another vessel.

We occupy approximately four hundred (400) square feet of office space without charge at the residence of Robert Rowe our Chief Executive Officer, President, Treasurer and Director, and Leah Rowe, our Secretary.

Research and Development

We have not spent any amounts on research and development in the prior two (2) years.

Government Regulation

Our business involves the use, handling, storage, and contracting for recycling or disposal of hazardous or toxic substances or wastes, including environmentally sensitive materials, such as motor oil, waste motor oil and filters, transmission fluid, antifreeze, freon, waste paint and lacquer thinner, batteries, solvents, lubricants, degreasing agents, gasoline, and diesel fuels. Accordingly, we are subject to regulation by federal, state, and local authorities establishing requirements for the use, management, handling, and disposal of these materials and health and environmental quality standards, and liability related thereto, and providing penalties for violations of those standards.

We do not believe we have any material environmental liabilities or that compliance with environmental laws, ordinances, and regulations will, individually or in the aggregate, have a material adverse effect on our business, financial condition, or results of operations.

Employees

As of December 31, 2017,2019, we have the following employees:

·

Robert Rowe, our President, Chief Executive Officer, Treasurer and Director who spends all his time on our business; and

·

Leah Rowe, Robert Rowe’s wife, our Secretary who spends between ten (10) to fifteen (15) hours per week on our business.

We use the services of independent contractors on an as needed basis.

None of our employees are represented by a collective bargaining agreement, nor have we experienced any work stoppages. We maintain good relationships with our employees.

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Material Agreements

On February 2, 2016, we entered into an agreement with Carter, Terry and Company (“Carter Terry)Terry”), a FINRA registered broker-dealer for the purposes of securing financing. Pursuant thereto we were obligated to pay Carter Terry a fee upon the Company receiving financing based upon their introduction of a funding source. The fee consists a percentage of money raised, and the issuance of common stock based upon the amount funded to the Company. The Company has entered into a termination agreement with Carter Terry as of March 22, 2017.

Effective February 16, 2016, we entered into an agreement with StockVest, Inc., a Florida corporation that provides investor relations and public relations services. The agreement was amended on March 1, 2016. As amended StockVest agreed to provide us with services from March 12, 2016 until June 12, 2016, in exchange for $500 and one hundred fifty thousand (150,000)(150) shares of our restricted common stock.

On August 11, 2016 we entered into a Securities Purchase Agreement with Tonaquint Inc., which provided for up to $610,000 in debt financing to the Company (inclusive of an original issue discount of $100,000). This agreement was amended on February 4, 2017 to extend the maturity date to May 11, 2017. In May 2017, the lender bifurcated the original note, which had a then remaining balance of $598,300, into two new notes, Note 1 with a principal balance of $200,000 and Note 2 with a principal balance of $416,249, which included a maturity extension fee of $17,949. Note 1 was collateralized with the Miss Leah and Note 2 with all Company’s assets including the Luxuria I. On September 14, 2017, the Company paid off the balance of Note 1 in the amount of $176,986 from the proceeds of the sale of the Miss Leah. On March 19, 2019 we entered into a Settlement Agreement with Tonaquint and St. George settling the outstanding notes with a $600,000 payment upon the sale of the Luxuria I and a payment of $70,000 six months thereafter. Both payments have been made and the notes have been satisfied.

On December 9, 2016, we entered into an agreement (the Agreement) with Oceanside Equities, Inc., (Oceanside), a Florida corporation that provides consulting services. Oceanside agreed to provide us with services from December 9, 2016 until December 8, 2019, in exchange for a one-time fee of $20,000 in cash; $16,000 per month accrued and payable in either cash or shares of restricted common stock at the Company’s election and three millionthousand one hundred thousand (3,100,000)(3,100) shares of our restricted common stock, to be issued 1,100,0001,100 on January 1, 2017, 1,000,0001,000 issued on July 1, 2017 and 1,000,0001,000 issued on January 1, 2018.

On January 5, 2017 we entered into a Securities Purchase Agreement with StSt. George Investments, LLC, which provided for up to $830,000 in debt funding to the Company (inclusive of an original issue discount of $75,000)., of which draws occurred in 2017 and 2018.

On April 15, 2017, the Company entered into a six-month 10% convertible promissory note in the amount of $15,000. In event of default the note carries an interest rate of 18%.

On April 19, 2017, the Company entered into an eight-month financing of the $14,500 Luxuria I annual insurance premium. On June 15, 2017, the Company entered into a six-month financing of the $3,211 Miss Leah 10-month insurance premium. Both of these notes were paid in full at December 31, 2017.

On June 8, 2017, pursuant to a securities purchase agreement and a one yearone-year convertible promissory note for $63,000 the Company received $60,000. In addition, the Company is required to pay $2,500 of the lender’s legal fees and $500 of due diligence fees which were withheld from the funds provided. This note carries a 12% interest rate, with all interest due at maturity.

On July 17, 2017, the company entered into a loan agreement in the amount of $50,000 with a shareholder. The company issued 1,000,0001,000 common shares to the shareholder as consideration for providing us the loan. The shares were valued at $15,000, or $0.015$15 per share based on the quoted market price and was recorded as a debt discount. The note bears interest at the rate of 12%, payable monthly. Total principal and interest is $52,217 at December 31, 2017.

On August 31, 2017, the Company entered into a six-month 10% convertible promissory note in the amount of $30,000. In

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event of default the note carries an interest rate of 18%.

On October 18, 2017, pursuant to a securities purchase agreement and a one-year convertible promissory note for $43,000 the Company received $40,000, net of $2,500 of the lender’s legal fees and $500 of due diligence fees which were withheld from the funds provided. This note carries a 12% interest rate, with all interest due at maturity.

On March 20, 2018, the Company entered into a nine-month 14% convertible promissory note in the amount of $16,500. In event of default the note carries an interest rate of 18%.

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On March 25, 2019, the Company entered into a seven-month 10% promissory note in the amount of $105,000. In event of default the note carries an interest rate of 18%.

Dependence on a Few Customers

We are not dependent on one (1) or a few customers and we do not expect to be so in the future.

Liability

The short termshort-term rental of vessels may expose us to potential liabilities for personal injury or property damage claims. We could be included as a defendant in product liability claims relating to defects in manufacture or design of our vessels. We plan to require manufacturers of our vessels to carry and provide proof of product liability insurance. We also maintain third-party product liability insurance in the amount of $300,000 per occurrence, which may not be sufficient for claims against us. Additionally, we carry $300,000 of coverage, per occurrence, for damage to our company owed vessel. There can be no assurance that we will not experience legal claims in excess of our insurance coverage or claims that are ultimately not covered by our insurance policy. If significant claims are made against us, our business, financial condition and results of operations may be adversely affected.

Competition

We operate in a highly competitive environment. In addition to facing competition generally from businesses seeking to attract discretionary spending dollars, the recreational boat industry itself is highly fragmented, resulting in intense competition. We completecompete with single location boat dealers and, to a lesser degree, with national specialty marine stores, catalog retailers, sporting goods stores and mass merchants. Competition is based on the quality of available products, the price and value of the products and attention to customer service. There is significant competition in the markets which we plan to enter.

Our competitors are large national or regional chains that have substantially greater financial, marketing and other resources than us. There can be no assurance that we will be able to compete successfully against current or future competitors or that competitive pressure will not have a material adverse effect on our business, operating results and financial condition.

Seasonality

Our business, as well as the entire recreational boating industry, is highly seasonal. Generally, boat sales increase starting in January with the onset of the public boat and recreation shows in South Florida and continue through March.

Our business will be affected by weather patterns which may adversely impact our future operating results. For example, hurricanes in the South Florida area or reduced rainfall levels, as well as excessive rain, may render boating dangerous or inconvenient, thereby curtailing customer demand for our products. In addition, unseasonably cool weather and prolonged winter conditions may lead to a shorter selling season in certain locations. The overall impact on our business from adverse weather conditions in any one (1) market area will continue to represent potential, material adverse risks to our financial performance.

Intellectual Property

We have not registered or patented any intellectual property. Trademarks and trade names distinguish companies from each other. If customers are unable to distinguish our products from those of other companies, we could lose sales to our competitors. We do not have any registered trademarks and trade names, so we only have common law rights with respect to infractions or infringements on its products. Many subtleties exist in product descriptions, offering and names that can easily confuse customers. The name of our principal products may be found in numerous variations of the name and descriptions in various media and product labels. This presents a risk of losing potential customers looking for our products and buying someone else’s because they cannot differentiate between them.

Legal Proceedings

We are not a party to any legal proceedings.

ITEM 1A.RISK FACTORS.

In addition to the information discussed elsewhere in this Annual Report, the following are important risks which could adversely affect our future results. If any of the risks we describe below materialize, or if any unforeseen riskdevelops, our operating results may suffer, our financial condition may deteriorate, the trading price of our common stock may decline, and our investors could lose all or part of their investment.

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Risks Related to Our Financial Condition

There is substantial doubt about our ability to continue as a going concern as a result of our limited operating history and financial resources, and if we are unable to generate significant revenue or secure financing we may be required to cease or curtail our operations.

We incurred net losses of $1,281,483$34,886 and $3,042,629$1,305,925 for the fiscal years ended December 31, 2016,2019, and December 31, 2017,2018, respectively. As a result, our independent registered public accounting firm hasfirms have included an explanatory paragraphparagraphs in itstheir audit opinionopinions and management has included a footnote regarding our going concern risk that we may be unable to continue as a going concern. Our limited operating history and financial resources raises substantial doubt about our ability to continue as a going concern and our consolidated financial statements contain a going concern qualification. Our consolidated financial statements do not include adjustments that might result from the outcome of this uncertainty and if we are unable to generate significant revenue or secure financing, we may be required to cease or curtail our operations.

We are an early stage company with little or no historical performance for you to base an investment decision upon, and we may never become profitable.

We are a recently formed company. For the fiscal years ended December 31, 2016,2018, and December 31, 2017,2019, we had revenues of $37,072$15,550 and $256,992$750,000, respectively. For the fiscal years ended December 31, 2016,2018, and December 31, 2017,2019, we have a net loss of $1,281,483$1,305,925 and $3,042,629$34,886, respectively. Accordingly, we have limited historical performance upon which you may evaluate our prospects for achieving our business objectives and becoming profitable in light of the risks, difficulties and uncertainties frequently encountered by early stage companies such as us. Accordingly, before investing in our common stock, you should consider the challenges, expenses and difficulties that we will face as an early stage company, and whether we will ever become profitable.

We are dependent on the sale of our securities to fund our operations.

We are dependent on the sale of our securities to fund our operations and will remain so until we generate sufficient revenues to pay for our operating costs. Our officers and directors have made no written commitments with respect to providing a source of liquidity in the form of cash advances, loans and/or financial guarantees.

If we are unable to generate sufficient revenues for our operating expenses we will need financing, which we may be unable to obtain; should we fail to obtain sufficient financing, our revenues will be negatively impacted.

Because we have limited revenues and lack historical financial data, including revenue data, our future revenues are unpredictable. Our operating expenses are approximately $12,500$10,000 per month or $150,000$120,000 annually. We will require $12,500$10,000 per month or $150,000$120,000 over the next twelve (12) months to meet our operational costs, which consist of rent, advertising, salaries and other general, administrative expenses to comply with the costs of being an SEC reporting company.

We are obligated to repay outstanding indebtedness of approximately $1,600,000$372,000 during the next 12 months.

There is no assurance we will have sufficient funds available to implement our plan of operations which could cause you to lose your investment.

Until we generate material operating revenues, we require additional debt or equity funding to continue our operations and implement our plan of operations. We intend to raise additional funds from an offering of our stock in the future; however, this offering may never occur, or if it occurs, we may be unable to raise the required funding. We do not have any plans or specific agreements for new sources of funding and we have no agreements for financing in place.

Expenses required to operate as a public company will reduce funds available to develop our business and could negatively affect our stock price and adversely affect our results of operations, cash flow and financial condition.

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We recently became a publicly traded company.

Operating as a public company is more expensive than operating as a private company, including additional funds required to obtain outside assistance for legal, accounting, investor relations, or other professionals that could be costlier than planned. We may also be required to hire additional staff to comply with additional SEC reporting requirements. We anticipate that the cost of SEC reporting will be approximately $60,000$70,000 annually. Our failure to comply with reporting requirements and other provisions of securities laws could negatively affect our stock price and adversely affect our results of operations, cash flow and financial condition. If we fail to meet these obligations and consequently fail to satisfy our SEC reporting obligations, investors will then own stock in a company that does not provide the disclosure available in quarterly, annual reports and

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other required SEC reports that would be otherwise publicly available leading to increased difficulty in selling their stock due to our becoming a non-reporting issuer.

Risks Related to Our Business

Our business is subject to significant regulations which increase our operating costs; if we fail to comply with these regulations our operations will be negatively impacted.

Our business involves the use, handling, storage, and contracting for recycling or disposal of hazardous or toxic substances or wastes, including environmentally sensitive materials, such as motor oil, waste motor oil and filters, transmission fluid, antifreeze, freon, waste paint and lacquer thinner, batteries, solvents, lubricants, degreasing agents, gasoline, and diesel fuels. Accordingly, we are subject to regulation by federal, state, and local authorities establishing requirements for the use, management, handling, and disposal of these materials and health and environmental quality standards, and liability related thereto, and providing penalties for violations of those standards.

Regulatory approval processes may be expensive, time-consuming and uncertain, and our failure to obtain or comply with these approvals or clearances could harm our business, financial condition and operating results.

Our industry is highly competitive, and our failure to compete effectively could adversely affect our market share, financial condition and future growth.

We operate in a highly competitive environment. In addition to facing competition generally from businesses seeking to attract discretionary spending dollars, the recreational boat industry itself is highly fragmented, resulting in intense competition. We compete with single location boat and yacht dealers and, to a lesser degree, with national specialty marine stores. Dealer competition is based on the quality of available products, the price and value of the products and attention to customer service. There is significant competition in the markets which we plan to enter.

Our competitors are large national or regional chains that have substantially greater financial, marketing and other resources than us. There can be no assurance that we will be able to compete successfully against current or future competitors or that competitive pressure will not have a material adverse effect on our business, operating results and financial condition.

Because Luxuria I, our company owned vessel is pledged as security for loans, if we default on the loans we would lose our primary asset and might not be able to continue our business plan which could cause you to lose your entire investment.

On August 4, 2016 we entered into a Securities Purchase Agreement and Note with Tonaquint Inc., pursuant to which we pledged the Miss Leah as security for the Note. We are obligated to pay the entire principal and interest on May 11, 2018. The loan is secured by the Luxuria I, our company owned vessel. Because Luxuria I is our primary asset and is pledged as security for a loan, you could lose your investment if we default on the loan. Because of our limited revenues and weak financial condition, we may not be able to make the loan payment when due on May 11, 2018. This would cause us to lose our primary asset and we might not be able to implement our business plan which could cause you to lose your entire investment.

On January 5, 2017 we entered into a Securities Purchase Agreement and Note with St George Investments, LLC, pursuant to which we pledged the Luxuria I and the future Luxuria II as security for the Note. We are obligated to pay the entire principal and interest on July 6, 2017. Because the Luxuria I and the future Luxuria II are our primary assets and are pledged as security for a loan, you could lose your investment if we default on the loan. Because of our limited revenues and weak financial condition, we may not be able to make the loan payment when due on July 6, 2018. This would cause us to lose our primary assets and we might not be able to continue our business plan which could cause you to lose your entire investment.

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The purchase of our products is discretionary and may be negatively impacted by adverse trends in the general economy and make it more difficult for us to generate revenues.

Our business is affected by general economic conditions since our products are discretionary and we depend, to a significant extent, upon a number of factors relating to discretionary consumer spending. These factors include economic conditions and perceptions of such conditions by consumers, employment rates, the level of consumers’ disposable income, business conditions, interest rates, consumer debt levels and availability of credit. Consumer spending on our products may be adversely affected by negative trends and changes in general economic conditions.

The success of our business depends on our ability to market our Luxuria vessels effectively.

Our ability to establish effective marketing and advertising campaigns is the key to our success. Our advertisements must effectively promote our corporate image, our Luxuria vessels and the pricing of such products. If we are unable to create awareness of our products, we may not be able to attract customers. Our marketing activities may not be successful in promoting the products we sell or pricing strategies or in retaining and increasing our customer base. We cannot assure you that our marketing programs will be adequate to create a demand for our products support our future growth, which may result in a material adverse effect on our results of operations.

We may be subject to product liability claims and we do not have insurance coverage for such claims which could negatively impact our financial condition.

By selling boats, we will face an inherent business risk of exposure to product liability claims in the event that the use of our products results in personal injury or death. Also, in the event that any of the components of our vessels is defective, we may be required to recall or replace such components. We maintain product liability insurance coverage in the amount of $300,000 to protect us from such claims, which may not be sufficient coverage for claims against us. A successful product liability claim or series of claims brought against us would negatively impact our business and cause you to lose your investment.

We are unable to predict the impact of COVID-19 on our company.

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The Luxuria series of floating homes is constructed in marine facilities and appeals to those that seek a lifestyle that incorporates being on the water. Our product is more expensive than a traditional home built on land. Because of COVID-19 and the uncertainty surrounding economic conditions moving forward we cannot predict the willingness of buyers to absorb the additional cost of a luxury floating home as compared to a traditional home. Additionally, due to the cancelation of large public events we don’t know if the cities of Miami and Fort Lauderdale will continue to host boat shows which are an important marketing tool for the Company.

We may be subject to intellectual property rights claims, which are costly to defend, could require us to pay damages and could limit our ability to sell some of our products.

We have no secured intellectual property protection of the Global Boatworks or Luxuria names. Our industry is characterized by vigorous pursuit and protection of intellectual property rights, which has resulted in protracted and expensive litigation for several companies. Third parties may assert claims of misappropriation of trade secrets or infringement of intellectual property rights against us for which we may be liable.

If our business expands, the number of products and competitors in our markets increases and product overlaps occur, infringement claims may increase in number and significance. Intellectual property lawsuits are subject to inherent uncertainties due to the complexity of the technical issues involved, and we cannot be certain that we would be successful in defending ourselves against intellectual property claims. Further, many potential litigants have the capability to dedicate substantially greater resources than we can to enforce their intellectual property rights and to defend claims that may be brought against them. Furthermore, a successful claimant could secure a judgment that requires us to pay substantial damages or prevents us from distributing our products.

If we fail to develop the Global Boatworks and Luxuria brand, cost-effectively, our business may be adversely affected.

The success of our products marketed under the Global Boatworks and Luxuria brands will depend upon the effectiveness of our marketing efforts. Brand promotion activities may not yield increased revenue, and even if they do, any increased revenue may not offset the expenses incurred in building the brands. If we fail to successfully promote and maintain our brands or incur substantial expenses in an unsuccessful attempt to promote and maintain our brands, we may fail to attract enough new customers or retain our existing customers to the extent necessary to realize a sufficient return on our brand-building efforts, and our business and results of operations could suffer.

Risks Related To Our Management

Should we lose the services of Robert Rowe, our Chief Executive Officer, President, Treasurer and Director, our financial condition and proposed expansion may be negatively impacted.

Our future depends on the continued contributions of Robert Rowe, our Chief Executive Officer, President, Treasurer and Director, who would be difficult to replace. Mr. Rowe is our only fulltime employee. Mr. Rowe’s services are critical to the

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management of our business and operations. We do not maintain key man life insurance on Mr. Rowe. Should we lose the services of Mr. Rowe, we may be unable to replace his services with equally competent and experienced personnel and our operational goals and strategies may be adversely affected, which will negatively affect our potential revenues.

Certain officers and directors devote limited time to our business, which may negatively impact upon our plan of operations, implementation of our business plan and our potential profitability.

Our Chief Executive Officer, President, Treasurer and Director, Robert Rowe is our only full-time employee. Leah Rowe, our Secretary spends approximately fifteen (15) hours per week on our business. The limited amountnumber of full-time employees we employ may be inadequate to implement our plan of operations and develop a profitable business.

Our officers and directors have no experience managing a public company which is required to establish and maintain disclosure controls and procedures and internal control over financial reporting.

We have never operated as a public company and our management has no experience managing a public company which is required to establish and maintain disclosure controls and procedures and internal control over financial reporting. As a result, we may not be able to operate successfully as a public company, even if our operations are successful. We plan to comply with all of the various rules and regulations, which are required for a public company that is reporting company with the Securities and Exchange Commission. However, if we cannot operate successfully as a public company, your investment may be materially adversely affected.

We incur additional costs and management time related expenses pertaining to SEC reporting obligations and SEC compliance matter and our management has no experience in such matters.

Robert Rowe, our Chief Executive Officer, President, Treasurer and Director is responsible for managing us, including compliance with SEC reporting obligations and maintaining disclosure controls and procedures and internal control over financial reporting. These public reporting requirements and controls are new to these individuals and at times will require us to obtain outside assistance from legal, accounting or other professionals that will increase our costs of doing business. Should we fail to comply with SEC reporting and internal controls and procedures, we may be subject to securities law violations that may result in additional compliance costs or costs associated with SEC judgments or fines, each of which would increase our costs and negatively affect our potential profitability and our ability to conduct our business.

Because we do not have an audit or compensation committee, shareholders will be required to rely on the members of our Board of Directors, who are not independent, to perform these functions.

We do not have an audit or compensation committee or Board of Directors as a whole that is composed of independent directors. Because our directors are also our officers and controlling shareholders, they are not independent. There is a potential conflict between their or our interests and our shareholders’ interests, since our directors are also our officers who will participate in discussions concerning management compensation and audit issues that may affect management decisions. Until we have an audit or compensation committee or independent directors, there may be less oversight of management decisions and activities and little ability for minority shareholders to challenge or reverse those activities and decisions, even if they are not in the best interests of minority shareholders.

We are an "emerging“emerging growth company,"” and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies will make our common stock less attractive to investors.

We are an "emerging“emerging growth company,"” as defined in the JOBS Act. For as long as we continue to be an emerging growth company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments, not previously approved. We could be an emerging growth company for up to five (5) years, although we could lose that status sooner if our revenues exceed $1,000,000,000, if we issue more than $1,000,000,000 in non-convertible debt in a three (3) year period, or if the market value of our common stock held by non-affiliates exceeds $100,000,000 as of any April 30th date before that time, in which case we would no longer be an emerging growth company as of the following April 30th We cannot predict whether investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

We have elected to use the extended transition period for complying with new or revised accounting standards under

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Section 102(b)(2) of the JOBS Act, that allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.

Risks Related to Our Common Stock

Our officers and directors have voting control over all matters submitted to a vote of our common stockholders, which will prevent our minority shareholders from having the ability to control any of our corporate actions.

As of March 31, 2018,June 12, 2020, we had 1,581,494,0042,901,311 shares of common stock outstanding, each entitled to one vote per common share. Our Chief Executive Officer, President, Treasurer and Director, Robert Rowe, beneficially owns 18.4%9.7% of the common shares and 1,000,000 preferred shares which represents approximately Fifty point five percent (50.5%)that have voting power equal to 1,000 shares of the total voting power.common stock for each preferred share. This entitles Mr. Rowe to control all matters submitted to a vote of our common stockholders. As a result, our management has the ability to determine the outcome of all matters submitted to our stockholders for approval, including the election of directors. Our management’s control of our voting securities may make it impossible to complete some corporate transactions without its support and may prevent a change in our control. In addition, this ownership could discourage the acquisition of our common stock by potential investors and could have an anti-takeover effect, possibly depressing the trading price of our common stock.

We will be subject to penny stock regulations and restrictions and you may have difficulty selling shares of our common stock.

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The SEC has adopted regulations which generally define so-called “penny stocks” to be an equity security that has a market price of less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exemptions. We anticipate that our common stock will be a “penny stock”, and we will become subject to Rule 15g-9 under the Exchange Act, or the “Penny Stock Rule”. This rule imposes additional sales practice requirements on broker-dealers that sell such securities to persons other than established customers. For transactions covered by Rule 15g-9, a broker-dealer must make a special suitability determination for the purchaser and have received the purchaser’s written consent to the transaction prior to sale. As a result, this rule may affect the ability of broker-dealers to sell our common shares and may affect the ability of purchasers to sell any of our common shares in the secondary market.

For any transaction (other than an exempt transaction) involving a penny stock, the rules require delivery, prior to such transaction, of a disclosure schedule prepared by the SEC relating to the penny stock market. Disclosure is also required to be made regarding sales commissions payable to both the broker-dealer and the registered representative, and current quotations for the securities.

Finally, monthly statements are required to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stock.

We do not anticipate that our common stock will qualify for exemption from the Penny Stock Rule. In any event, even if our common stock is exempt from the Penny Stock Rule, we would remain subject to Section 15(b)(6) of the Exchange Act, which gives the SEC the authority to restrict any person from participating in a distribution of penny stock, if the SEC finds that such a restriction would be in the public interest.

Sales of our common stock under Rule 144 could reduce the price of our stock.

In general, persons holding restricted securities in a SEC reporting company, including affiliates, must hold their shares for a period of at least six months, may not sell more than one percent (1%) of the total issued and outstanding shares in any ninety (90) day period, and must resell the shares in an unsolicited brokerage transaction at the market price. If substantial amounts of our common stock become available for resale under Rule 144, prevailing market prices for our common stock will be reduced.

We may, in the future, issue additional securities, which would reduce investors’ percent of ownership and may dilute our share value.

Our Articles of Incorporation authorize us to issue 5,000,000,000 shares of common stock and 10,000,000 shares of blank check preferred stock. As of the issuance date of this Form 10-K,June 12, 2020, we had 1,581,494,0042,901,311 shares of common stock and 1,000,000 shares of Series A redeemable preferred shares outstanding. Accordingly, we may issue up to an additional 3,443,873,0934,997,098,689 shares of common stock and 9,000,000 shares of blank check preferred stock. The future issuance of common stock may result in substantial dilution in the percentage of our common stock held by our then existing

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shareholders. We may value any common stock issued in the future on an arbitrary basis including for acquisitions or other corporate actions and on a fair value basis for shares issued for services that may have the effect of diluting the value of the shares held by our stockholders and may have an adverse effect on any trading market for our common stock. Our Board of Directors may designate the rights, terms and preferences of our authorized but unissued preferred shares at its discretion including conversion and voting preferences without notice to our shareholders.

Because we do not expect to pay dividends for the foreseeable future, investors seeking cash dividends should not purchase our common stock.

We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future. Our payment of any future dividends will be at the sole discretion of our Board of Directors after considering whether we have generated sufficient revenues, our financial condition, operating results, cash needs, growth plans and other factors. Accordingly, investors that are seeking cash dividends should not purchase our common stock.

As an issuer of “penny stock” the protection provided by the federal securities laws relating to forward looking statements does not apply to us.

Although the federal securities law provides a safe harbor for forward-looking statements made by a public company that files reports under the federal securities laws, this safe harbor is not available to issuers of penny stocks. As a result, if we are a penny stock we will not have the benefit of this safe harbor protection in the event of any claim that the material provided by us contained a material misstatement of fact or was misleading in any material respect because of our failure to include any statements necessary to make the statements not misleading.

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ITEM 1B. UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 2. PROPERTIES

The Company occupiespreviouly occupied dockage space for the Luxuria I at the Bahia Mar Marina in Fort Lauderdale, Florida. Following the sale of the Luxuria we no longer require dock space. We occupy approximately four hundred (400) square feet of office space without charge at the residence of Robert Rowe our Chief Executive Officer, President, Treasurer and Director, and Leah Rowe, our Secretary.

ITEM 3.LEGAL PROCEEDINGS

We are not aware of any pending or threatened legal proceedings in which we are involved.

ITEM 4.MINE SAFETY DISCLOSURES

The disclosure required by this item is not applicable.

PART II

ITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Trading Market for Securities

The Company’s securities trade on OTC Markets under symbol GBBT.

The following table sets forth the low and high closing prices for the company’s stock during each quarter of 20172018, after given effect to the Company’s reverse split effective December 14, 2018:

Security Holders

As of December 31, 2017,2019, we had thirty-four (34)fifty-four (54) record holders of our common stock.

Dividends

Since inception we have not paid any dividends on our common or preferred stock. We currently do not anticipate paying any cash dividends in the foreseeable future on our common or preferred stock. Although we intend to retain our earnings, if any, to finance the exploration and growth of our business, our Board of Directors will have the discretion to declare and pay dividends in the future. Payment of dividends in the future will depend upon our earnings, capital requirements, and other factors, which our Board of Directors may deem relevant.

Issuer Purchases of Equity Securities

None

Recent Sales of Unregistered Equity Securities

In addition to unregistered securities previously disclosed in reports filed with the SEC, we have sold the following securities set foth below without registration under the Securities Act of 1933 (the “Securities Act”). None of the issuances involved underwriters, underwriting discounts or commissions, unless otherwise noted. We relied upon Sections 4(2) of the Securities Act, and Rule 506 of the Securities Act of 1933, as amended for the offer and sale of the securities.

Shares Issued for Cash Consideration

On October 19, 2016 the Company entered into a subscription with an existing shareholder and issued the shareholder 600,000 shares priced at $.06 per share.

On December 12, 2016 the Company entered into a subscription with an existing shareholder and issued the shareholder 41,667 shares priced at $.06 per share.

Shares Issued for Services Rendered and Non-Cash Consideration

On January 2, 2017, we issued 1,100,000 common shares to Oceanside Equities, Inc. a Florida corporation controlled by Vince Beatty for consulting services to be rendered under a consulting agreement entered into on December 1, 2016. Pursuant to that agreement we additionally became obligated to issue 1,000,000 shares on July 1, 2017 and 1,000,000 shares on January 2, 2018.

In January 2017,29, 2018, the Company issued 100,00025,378 shares of common stock underupon conversion of a December 5, 2016, promissory note amendment, valued at $0.15 per share based on quoted trading price, or a totalprincipal in the amount of $15,000.$9,390.

InOn January 2017,30, 2018, the Company issued 200,00041,667 shares of common stock underupon conversion of a note principal in the amount of $15,000. On January 18, 2017, consulting agreement, valued at $0.08 per share based on quoted trading price on agreement date, or a total of $16,000.

In January 2017,30, 2018, the Company issued 250,00025,378 shares of common stock underupon conversion of a January 23, 2017, consulting agreement, valued at $0.14 per share based on quoted trading price on agreement date, or a totalnote principal in the amount of $33,750. Pursuant to this agreement we additionally issued 250,000 shares on March 9, 2017.$9,390.

On May 4, 2017,January 31, 2018, the Company issued 75,00025,378 shares of common stock upon conversion of a note principal in the amount of $9,390.

On February 5, 2018, the Company issued 25,392 shares of common stock upon conversion of a note principal in the amount of $9,395.

On February 6, 2018, the Company issued 50,000 shares of common stock upon conversion of a note principal in the amount of $18,000. On February 6, 2018, the Company issued 25,387 shares of common stock upon conversion of a note principal in the amount of $7,870.

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On February 12, 2018, the Company issued 50,750 shares of common stock upon conversion of a note principal in the amount of $15,225. On February 12, 2018, the Company issued 25,339 shares of common stock upon conversion of a note principal in the amount of $6,955.

On February 19, 2018, the Company issued 95,000 shares of common stock upon conversion of a note principal in the amount of $17,100.

On February 23, 2018, the Company issued 93,750 shares of common stock upon conversion of a note principal in the amount of $11,250.

On March 2, 2018, the Company issued 95,000 shares of common stock upon conversion of a note principal in the amount of $11,400.

On March 7, 2018, the Company issued 1,000 shares of common stock under a consulting agreement.

On May 19, 2017,March 12, 2018, the Company issued 5,000,000 shares of common stock to each of the Company’s two officers in exchange for services rendered, and 5,000,000 shares to a related party consultant, who is the nephew of the CEO, in exchange for services rendered.  

On May 25, 2017, the Company issued 4,800,000 shares of common stock to settle $48,000 of expenses accrued under a consulting agreement.

On September 5, 2017, the Company issued 446,000,00094,500 shares of common stock upon conversion of $223,000a note principal in the amount of accrued liabilities to three related parties.
$11,400.

On December 18, 2017,March 16, 2018, the Company issued 166,153,84612,000 shares of common stock upon conversion of a note principal in the amount of $2,880.

On March 20, 2018, the Company issued 95,000 shares of common stock upon conversion of a note principal in the amount of $11,400.

On March 28, 2018, the Company issued 94,000 shares of common stock upon conversion of a Note principal in the amount of $11,280.

On April 16, 2018, the Company issued 158,000 shares of common stock upon conversion of a note principal in the amount of $9,480.

On May 1, 2018, the Company issued 78,833 shares of common stock upon conversion of a note principal in the amount of $4,730. On May 1, 2018, the Company issued 49,833 shares of common stock upon conversion of a note principal in the amount of $2,990.

On May 3, 2018, the Company issued 53,833 shares of common stock upon conversion of a note principal in the amount of $3,230.

On May 8, 2018, the Company issued 58,667 shares of common stock upon conversion of a note principal in the amount of $3,520.

On May 11, 2018, the Company issued 53,833 shares of common stock upon conversion of a note principal in the amount of $6,460.

On May 22, 2018, the Company issued 88,500 shares of common stock upon conversion of a note principal in the amount of $10,620.

On May 25, 2018, the Company issued 71,000 shares of common stock upon conversion of a note principal in the amount of $8,520.

On June 11, 2018, the Company issued 60,000 shares of common stock upon conversion of a note principal in the amount of $3,600.

On June 12, 2018, the Company issued 41,500 shares of common stock upon conversion of a note principal in the amount of $2,490, which was $870 greater than the then remaining note and accrued interest balance, therefore 14,500 shares were issued in excess.

On June 13, 2018, the Company issued 60,000 shares of common stock upon conversion of a note principal in the amount of $3,600, which was $3,600 greater than the then remaining note and accrued interest balance, therefore 60,000 shares were issued in excess.

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On June 14, 2018, the Company issued 41,445 shares of common stock upon conversion of a note principal in the amount of $2,487, which was $2,487 greater than the then remaining note and accrued interest balance, therefore 41,445 shares were issued in excess.

On June 18, 2018, the Company issued 5,167 shares of common stock upon conversion of a note accrued interest in the amount of $310, which was $310 greater than the then remaining note and accrued interest balance, therefore 5,167 shares were issued in excess. The Company has instructed the lender to convert $108,000either return the 133,611 excess shares or remit $7,267 in cash to the Company. The lender refused and the Company wrote this off as a bad debt.

On January 15, 2019, the Company issued 238,000 shares of accrued expenses.common stock upon conversion of a note principal in the amount of $705.

On March 1, 2019, the Company issued 260,000 shares of common stock upon conversion of a note principal in the amount of $910.

At December 31, 2019 the Company is obligated to issue 1,000 shares, valued at $300, to a consultant under an agreement entered into May 22, 2018.

ITEM 6. SELECTED FINANCIAL DATA

Not required.

ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

We were founded in September of 2014 to commercialize luxury living floating vessels. We plan to generate revenues from the sale of and rental of the vessels initially in South Florida. Our newly developed Luxuria model features a South Florida modern style and is approximately one thousand six hundred (1,600) square feet under air. The vessel offers amenities typically found in a luxury home.

Years Ended December 31, 20172019 and 20162018

We had vessel sale revenues of $222,187$750,000 and $0 for the years ended December 31, 20172019 and 2016.2018.

We had rental revenues of $34,805$0 and $37,072$15,550 for the years ended December 31, 20172019 and 2016,2018, respectively, or a 6.1%100% decrease. We sold the Miss Leah in September 2017 and placed the Luxuria I into service on July 1, but were limited in our rental ability because we showed the Luxuria in the Ft Lauderdale International Boat Show.

Cost of revenues, excluding depreciation, was $43,042$662,457 compared to $16,729$63,855 for the years ended December 31, 20172019 and 2016,2018, respectively, or a 157.2%937.4% increase. This increase was primarily due to the Luxuria I becoming availablebeing sold. The Luxuria I was depreciated for rent12 months in 2018 and sale on July 1, 2017 and all relevant costs are higher for the Luxuria.only 4 months in 2019.

Gross margin was $213,960

General and $20,343administrative expenses were $313,233 compared to $320,197 for the years ended December 31, 20172019 and 2016, respectively.

General and administrative expenses were $1,701,915 compared to $282,363 for the years ended December 31, 2017 and 2016,2018, respectively, an increasea decrease of 502.7%2.17%. General and administrative expenses are principally composed of public company expenses, insurance, maintenance, officer pay and travel. The primary increase was in stock based compensation

Our depreciation expense on all depreciable assets for the officers of approximately $1.2 million.years ended December 31, 2019 and 2018 was $23,932 and $71,640, respectively. The Luxuria was depreciated for four months the year in 2019 and the whole year in 2018.

Our professional fees - related party were $1,191,455$208,000 compared to $0$264,000 for the years ended December 31, 20172019 and 2016,2018, respectively. These fees were accruedThe decrease is due to the contracts expiring during the year and converted to common stock with $0 paid in cash, and includes stock issued for services valued at $145,000.not being renewed.

Our professional fees were $247,192$128,721 compared to $217,695$95,205 for the years ended December 31, 20172019 and 2016,2018, respectively, an increase of 13.6%35.2%. This was primarily due to our engagement of a consultant utilized during the marketing of the Luxuria I for sale.

Our interest expense was $460,451$43,316 compared to $479,218$236,405 for the years ended December 31, 20172019 and 2016,2018, respectively, a decrease of 3.9%81.7%. This decrease is due to the payoff of certain debt with the sale of the Luxuria I and conversions of our convertible debt.

Our gain (loss) on debt extinguishment was $1,275,814 and ($258,809) for the years ended December 31, 2019 and 2018, respectively.

Our derivative income (expense) and change in fair value of derivative expense was $233,243$681,163 and ($321,185)$4,097 for the years ended December 31, 20172019 and 2016,2018, respectively.

We recorded a net loss of ($3,042,629)34,886) compared to ($1,281,483)1,305,925) for the years ended December 31, 20172019 and 2016,2018, respectively.

Liquidity and Capital Resources Cash Flow Activities

Cash Flow Activities

Our cash decreased $9,404$841 for the year ended December 31, 2017.2019. We used $382,583$91,746 of cash in operating activities during the year. Our operating activities consisted primarily of marketing and selling the Miss Leah, completing the construction ofmaintaining the Luxuria I and showing the Luxuria in the Ft. Lauderdale International Boat Show in November.subsequently marketing for custom design and build floating vessels.

Our cash decreased $36,968$146 for the year ended December 31, 2016.2018. We used $579,668$208,484 of cash in operating activities during the year.  Our operating activities consisted primarily of rentingmarketing and marketing the Miss Leah as well as beginning the construction ofmaintaining the Luxuria I.

Investing Activities

During the year ended December 31, 2017,2019, we purchased $6,296 in fixed assets and received a $20,000 repaymenthad investing activities of a loan to a stockholder made in 2016.the receipt of $625,107 for the sale of the Luxuria I.

During the year ended December 31, 2016,2018, we loaned $50,000 to a stockholder.had no investing activities.

Financing Activities

During the year ended December 31, 2017,2019, we funded our working capital requirements principally through the proceeds of thirdrelated party loans in the amount of $563,000.$182,500. During the year ended December 31, 2019, we received $26,029 and repaid $21,534 on officer advances. We paid $721,198 on third party loans.

During the year ended December 31, 2016,2018, we funded our working capital requirements principally through the proceeds of third partythird-party loans in the amount of $492,000$236,500. During the year ended December 31, 2018, we received $20,581 and the sale of common stock in the amount of $119,500.repaid $29,643 on officer advances. We paid $19,100 on third party loans.  

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires our management to make assumptions, estimates and judgments that affect the amounts reported in the financial statements, including the notes thereto, and related disclosures of commitments and contingencies, if any. We consider our critical accounting policies to be those that require the more significant judgments and estimates in the preparation of consolidated financial statements, including the following:

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Fair Value of Financial Instruments

Our financial instruments consist of cash and cash equivalents, prepaid expenses, payables and accrued expenses. Fair value estimates are made at a specific point in time, based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. We consider the carrying values of our financial instruments in the consolidated financial statements to approximate fair value, due to their short-term nature.

Revenue Recognition

Rental Revenue Revenue is recognized when earned, generally starting when the rental customer takes temporary possession of the floating vessel and through their contracted stay. Revenue is recognized on a gross basis in accordance with ASC 606.

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accordance with ASC 605-45. Cost of Revenue includes the marina dockage fees and fees charged by the web sitesites Homeaway and AirBnB, where the floating vessel is advertised for rent.

Sale Revenue Revenue is recognized when earned, generally at closing of the sale of a vessel. Revenue is recognized on a gross basis in accordance with ASC 605-45.606. Cost of Revenue includes the capitalized cost of constructing a vessel.vessel and any selling costs such as sales commissions.

Construction in progress

Costs to construct vessels are capitalized during the construction phase. Upon completion of a vessel the Company will either sell the vessel or place in it service as a rental property. If the vessel is to be leased the construction costs are transferred to property and equipment held for sale and depreciated over its useful life.

Property and Equipment

Property and equipment are recorded at cost, less accumulated depreciation. Depreciation is provided for using straight-line methods over the estimated useful lives of the respective assets.

Valuation of Long-Lived Assets

We periodically evaluate long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. If the estimated future cash flows (undiscounted and without interest charges) from the use of an asset were less than the carrying value, a write-down would be recorded to reduce the related asset to its estimated fair value.

Derivatives

The Company evaluates its convertible debt, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for. The result of this accounting treatment is that under certain circumstances the fair value of the derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statement of operations as other income or expense. Upon conversion or exercise of a convertible note containing an embedded derivative instrument, the instrument is marked to fair value at the conversion date and the debt and derivatives are removed from the balance sheet. The shares issued upon conversion of the note are recorded at their fair value with extinguishment gain or loss recognition as applicable.

Equity instruments that are initially classified as equity that become subject to reclassification under this accounting standard are reclassified to liability at the fair value of the instrument on the reclassification date.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements as defined in Regulation S-K Item 303(a)(4).

Recent Accounting Pronouncements

(See “Recently Issued Accounting Pronouncements” in Note 3 m) of Notes to the consolidated Financial Statements.)

Plan of Operations

Historically, we generated revenue from the short-term vacation rental of the Miss Leah, a company owned vessel located in Boston Harbor, Massachusetts. We sold the Miss Leah in September 2017. As of June 30, 2017, we transferred the Luxuria I from construction in process to fixed assets held for rental and sale. We haveThe Luxuria I was sold on April 24, 2019.

Once the Luxuria I listed bothwas sold, we began negotiating with several parties for salecustom design and build floating vessels. Some of these negotiations are for rental.smaller versions of the Luxuria I. One party that we have been negotiating with is for a super size floating vessel that would be used as a combination sales office and model for a condominium project. Generally these projects are cost plus type projects which will require significant deposits and progress payments during the design and build, which will make each project self-sustaining. We are also seeking funding for our ongoing operations beyond these projects.

As of December 31, 2017,2019, we had cash on hand of $1,107$120 for our operational needs. Currently, our operating expenses are approximately $12,500$10,000 per month.

We were obligated to repay an outstanding loan in one lump payment in the amount of $40,000$106,500 (including accrued interest) on July 15, 2017,2019, which is past due as of the date of this filing and is under negotiations for an extension. in default.

We arewere obligated to repay an outstanding loan in the amount of $417,368$632,782 on MayNovember 11, 2018. We arewere obligated to repay an outstanding loan in one lump payment in the amount of $345,050$315,056 on July 5,November 11, 2018. Both of these notes are in

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default. In March 2019, we negotiated a combined settlement for these notes which consists of a $600,000 payment upon the closing of the sale of the Luxuria I and $70,000 six months thereafter. These amounts have been paid.

We arewere obligated to repay an outstanding loan in one lump payment in the amount of $15,000 on October 15, 2017, which is past due as of the date of this filing but is expected to be converted to common stock.filing. We arewere obligated to repay threetwo outstanding loans in one lump payment, each in the amountsamount of $10,000;

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$10,000 and $15,500$10,000 on May 16, 2018.17, 2018, which are past due as of the date of this filing. We arewere obligated to repay an outstanding loan in one lump payment in the amount of $47,004$30,000 on June 7, 2018,October 15, 2017, which has been converted in its entiretyis past due as of the date of this filing. We are obligated to repay an outstanding loan in one lump payment in the amount of $43,000 on October 6, 2018. We arewere obligated to repay an outstanding loan in one lump payment in the amount of $16,500 on December 30, 2018. As2018, which was repaid in March 2019.

We were obligated to repay a result of not filing our Annual Report on Form 10-K timely, we have received notification that these last two convertible notesnote in one lump payment in the amountsamount of $43,000 and $16,500 are in default,$80,000 on October 15, 2019, which requires ushas been amended to pay a default penalty of $29,750, or 50% of the then outstanding loan balances.be due on demand.

We are obligated to repay a note in one lump payment in the amount of $77,500 on demand.

If we fail to generate sufficient revenues or raise additional funds to meet our monthly operating costs, we would have available cash for our operating needs for approximately zero (0) months.

We are focusing our efforts on commercializing luxury stationary vessels designed in a South Florida modern style. We completed the design of the Luxuria model in the first quarter of 2015 and began construction in March 2016. It was completed as of June 30, 2017. Luxuria I is approximately 1,9001,600 square feet, with two (2) bedrooms and bathrooms, and sleeps up to six (6) people. We are also marketing the concept of custom designed and built smaller versions of the Luxuria that would cost less to build and have a lower selling price.

We currently have the Luxuria listed with two brokers as a short-term vacation rental property in South Florida and also have it listed for outright sale. We believe that using the Luxuria as a short-term vacation rental in South Florida could provide a year round source of cash flow.

While rental of the Luxuria is expected to provide a relatively steady revenue stream to us, the construction and sale of custom designed and built luxury floating vessels are expected to generate significantly greater revenues and potential profits.

We anticipate that each non-custom vessel will cost approximately $650,000 to construct. Construction will take between three (3)five (5) to four (4)seven (7) months, per vessel. We will require additional funds to develop and carry out our future plans including construction of our second Luxuria class vessel which has not yet commenced. We plan to begin marketing each vessel when manufacturing commences.

Our first Luxuria barge bottom was delivered to us in late February 2016. We issued 425,000 shares of our common stock as payment for this barge bottom, valued at $70,000, or $0.16 per share, under an agreement dated August 11, 2016, at which time the market price of the stock was $0.23 per share. This party has not accepted the stock certificate and recently informed the Company that they want to renegotiate since the market price of the common stock has fallen below the negotiated signed contractual price per share.

The retail price of the Luxuria is between $1,200,000 and $1,500,000. The subsequent sale of the Luxuria vessel would provide sufficient capital to repay the remaining balance of the Company’s debt.

We are currently marketing the Luxuria models to yacht brokers, real estate brokers and boat dealerships.

Our cash balance at December 31, 20172019 was approximately $1,100,$119 , which is approximately zero (0) months of net cash outflow.

We have an accumulated deficit of $4,647,540$5,988,352 from inception to December 31, 2017.2019. A significant portion of this accumulated deficit is the result of a non-cash expenses such as the issuance of common stock for services rendered, amortization of beneficial conversion feature discounts and amortization of embedded derivative value discounts on convertible debt.

Our future plans to build a second Luxuria class vessel are contingent upon the receipt of capital of at least $700,000. This may be from a future offering of the Company’s securities or from the sale of the Luxuriasecurities.

Until such time as the Luxuria I is sold, we will continue to rent the vessel on a vacation rental basis. We arehad been marketing the Luxuria models to yacht brokers, real estate brokers and boat dealerships and have showed it in the FtFt. Lauderdale boat show in November 2017. The Luxuria I was sold on April 24, 2019.

Convertible Notes

NOTES 1 AND 2:

On August 11, 2016, pursuant to a securities purchase agreement and a secured convertible promissory note for $610,000, the Company drew $305,000 and received $227,500 in cash under this six month secured convertible promissory note. This note was secured by all the assets of the Company, inclusive of the Miss Leah and the Luxuria 1, and the member interests of its wholly owned LLC. This note was structured in two parts, first the initial $305,000 as drawn and a subsequent $305,000 which can be drawn at the Company���s option in amount/s determined by the Company. This note does not carry a stated interest rate, but carries an Original Issue Discount (OID) that totals $100,000 and is proportional to the total amount borrowed. An OID of $50,000 was recorded as a discount to the note for the initial draw and were amortized over the six month life of the note. In addition, the Company is required to pay $10,000 of the lender’s legal fees (pro rata to the draws) and $22,500 of brokerage commission which was withheld from the initial $305,000 draw, both of which also were recorded as debt discounts and were amortized over the six month life of the note. Also, the Company was required to issue 100 shares of restricted common stock which was valued at $100 per share based on recent stock sales and recorded as a discount to the note and is being amortized over the six month life of the note. This note requires a $200,000 partial prepayment when the Company sells the Miss Leah. The note is personally guaranteed by the Company’s CEO, Robert Rowe. In event of default the note carried an interest rate equal to the lesser of 22% per annum or the maximum rate permitted under applicable law.

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On October 5, 2016, the Company drew an additional $122,000 and received $92,000 in cash under this six month secured convertible promissory note. An OID of $20,000 was recorded as a discount to the note for the second draw and was amortized over the remaining life of the note. On November 3, 2016, the Company drew an additional $183,000 and received $150,000 in cash under this six month secured convertible promissory note. An OID of $30,000 and legal costs of $3,000 were recorded as discounts to the note for the third draw and was amortized over the remaining life of the note.

The total note is convertible into common stock upon an event of default as follows:

The total note was convertible into common stock upon an event of default as follows:

Lender has the right at any time following an Event of Default, at its election, to convert (each instance of conversion is referred to herein as a “Conversion”) all or any part of the Conversion Eligible Outstanding Balance into shares (“Conversion Shares”) of fully paid and non-assessable common stock, $0.0001 par value per share (“Common Stock”), of Company as per the following conversion formula: the number of Conversion Shares equals the amount being converted (the “Conversion Amount”) divided by the Conversion Price (as defined below).

Subject to the adjustments set forth herein, the conversion price (the “Conversion Price”) for each Conversion shall be equal to 60% (the “Conversion Factor”) multiplied by the lowest Closing Bid Price in the twenty (20) Trading Days immediately preceding the applicable Conversion. Additionally, if at any time after the Effective Date, the Conversion Shares are not DTC Eligible, then the then-current Conversion Factor will automatically be reduced by 5% for all future Conversions. Finally, in addition to the Default Effect, if any Major Default occurs after the Effective Date (other than an Event of Default for failure to pay the Conversion Eligible Outstanding Balance on the Maturity Date), the Conversion Factor shall automatically be reduced for all future Conversions by an additional 5% for each of the first three (3) Major Defaults that occur after the Effective Date (for the avoidance of doubt, each occurrence of any Major Default shall be deemed to be a separate occurrence for purposes of the foregoing reductions in Conversion Factor, even if the same Major Default occurs three (3) separate times). For example, the first time the Conversion Shares are not DTC Eligible, the Conversion Factor for future Conversions thereafter will be reduced from 60% to 55% for purposes of this example. If, thereafter, there are three (3) separate occurrences of a Major Default pursuant to Section 4.1(a), then for purposes of this example the Conversion Factor would be reduced by 5% for the first such occurrence, and so on for each of the second and third occurrences of such Major Default.

Due to the variable conversion terms and certain default provisions, the embedded conversion option has been bifurcated and recorded as a derivative liability at an initial fair value of $378,624 with $217,500 recorded as a debt discount and $161,124 as a derivative expense. The October 5, 2016 draw resulted in an initial fair value of $113,616 with $92,000 recorded as a debt discount and $21,616 as a derivative expense.  The November 3, 2016 draw resulted in an initial fair value of $190,356 with $150,000 recorded as a debt discount and $40,356 as a derivative expense. The valuation method utilized during 2017 was the Black-Scholes model with the following assumptions: Expected life in years 0.10; Stock price at December 31, 2017 of $1.10 with the conversion price of $0.54; Bond equivalent yield rate 1.28%.

On February 4, 2017, the maturity date was extended to May 11, 2017. Under the terms of this extension, the Company agreed to pay an additional $18,300 in interest at maturity. The Company recorded this interest as a debt discount and was amortized to maturity. At December 31, 2019, the unamortized balance is $0.

On March 22, 2017, the Company issued 1,000 shares of common stock to settle $30,000 of this note. These shares were valued at $73 per share, or $73,000, based on the quoted trading price, and after relieving the related derivative value a gain of $3,463 was recorded. (See Note 11)

In May 2017, the lender bifurcated the original note, which had a then remaining balance of $598,300, into two new notes, Note 1 with a principal balance of $200,000 and Note 2 with a principal balance of $416,249, which included a maturity extension fee of $17,949. Note 1 is collateralized with the Miss Leah and Note 2 with all Company’s assets including the Luxuria I.

Note 1 required a mandatory partial prepayment of up to $200,000 when the Company sold the Miss Leah, upon the receipt of which the lender agreed to release the security interest in the vessel. Note 2 contains no such provision.  All other provisions of the original note are carried over to these two new notes. The maturity date of theses two notes was August 11, 2017. On August 11, 2017, the lender agreed to negotiate three month extensions for both notes which was completed August 14, 2017, and combined extension fee of $17,619 was added to the principal balance of the notes.

On July 18, 2017, the Company issued 2,308 shares of common stock upon conversion $18,000 of Note 1. On August 10, 2017, the Company issued 3,800 shares of common stock upon conversion $10,944 of Note 1. The bifurcated convertible Notes 1 and  2 in the remaining balances of $182,000 and $416,249 matured on August 11, 2017. On November 11, 2017, the lender agreed to extend Note 2 for an additional three month period and an extension fee of $12,595 was added to the principal balance of Note 2.

On September 14, 2017, the Company paid off the balance of Note 1 in the amount of $176,986 from the proceeds of the sale of the Miss Leah.

On October 13, 2017, the Company issued 6,190 shares of common stock upon conversion of Note 2 principal in the amount of $8,914. On December 27, 2017, the Company issued 25,000 shares of common stock upon conversion of Note 2 principal in the amount of $15,000. At December 31, 2017, the balance was $417,368 and the unamortized discount was $5,750.

On January 30, 2018, the Company issued 41,667 shares of common stock upon conversion of Note 2 principal in the amount of $15,000. On February 6, 2018, the Company issued 50,000 shares of common stock upon conversion of Note 2 principal in the amount of $18,000. On February 12, 2018, the Company issued 50,750 shares of common stock upon conversion of Note 2 principal in the amount of $15,225.  On February 19, 2018, the Company issued 95,000 shares of common stock upon conversion of Note 2 principal in the amount of $17,100. On February 23, 2018, the Company issued 93,750 shares of common stock upon conversion of Note 2 principal in the amount of $11,250. On March 2, 2018, the Company issued 95,000 shares of common stock upon conversion of Note 2 principal in the amount of $11,400. On March 12, 2018, the Company issued 94,500 shares of common stock upon conversion of Note 2 principal in the amount of $11,400. On March 20, 2018, the Company issued 95,000 shares of common stock upon conversion of Note 2 principal in the amount of $11,400. On March 28, 2018, the Company issued 94,000 shares of common stock upon conversion of Note 2 principal in the amount of $11,280. On April 16, 2018, the Company issued 158,000 shares of common stock upon conversion of Note 2 principal in the amount of $9,480.

On January 15, 2019, the Company issued 238,000 shares of common stock upon conversion of Note 2 principal in the amount of $704. On March 1, 2019, the Company issued 260,000 shares of common stock upon conversion of Note 2 principal in the amount of $910.

At December 31, 2018, the valuation method utilized to compute the embedded derivative liability was the Black-Scholes model with the following assumptions: Expected life in years 0.0; Stock price at December 31, 2018 $0.10; conversion price of $0.06; Bond equivalent yield rate 2.44%.

The lender of Note 2 each in Notes 7a and b (with a combined total due of $947,840) agreed to a global settlement of $600,000 upon the closing of the sale of the Luxuria I and $72,500 due December 5, 2019. The lender agreed to forgive the $273,675 balance, which was recorded as a debt extinguishment gain. This second tranche was paid on December 5, 2019.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

Not Applicable.

ITEM 8.  FINANCIAL STATEMENTS