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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

[X]      Quarterly  Report Under Section 13 or 15(d) of the Securities  Exchange
         Act of 1934

                  For the quarterly period ended June 30, 2005

[_]      Transition Report Under Section 13 or 15(d) of the Securities  Exchange
         Act of 1934

  For the transition period from __________________ to ______________________.

                        Commission file number 000-13895

                               SEALIFE CORPORATION
        (Exact Name of Small Business Issuer as Specified in its Charter)

          DELAWARE                                              90-0224435
(State or other jurisdiction of                              (I.R.S. Employer
 incorporation or organization)                              Identification No.)

              5601 W. SLAUSON AVENUE, CULVER CITY, CALIFORNIA 90230
                    (Address of principal executive offices)

                                 (310) 338-9757
                          (Issuer's telephone number)

         Check whether the issuer (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 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 [_]


         As of August 4, 2005, the issuer had 19,581,013 shares of common stock,
par value $.0001 per share, issued and outstanding.

         Transitional Small Business Disclosure Format (check one):

                                  Yes [_]    No [X]


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<PAGE>


                               SEALIFE CORPORATION

                              INDEX TO FORM 10-QSB

                                                                            PAGE
                                                                            ----

PART I   FINANCIAL INFORMATION.................................................3

Item 1.  Financial Statements (unaudited)......................................3

         Condensed Consolidated Balance Sheet (unaudited)
         as of June 30, 2005...................................................3

         Condensed Consolidated Statement of Income (unaudited)
         for the three months and six months ended June 30, 2005
         and June 30, 2004.....................................................4

         Condensed Consolidated Statements of Cash Flows
         (unaudited) for the three and six months ended
         June 30, 2005 and June 30, 2004.......................................5

         Notes to Condensed Consolidated Financial Statements..................6

Item 2.  Management's Discussion and Analysis or Plan of Operation............14

Item 3.  Controls and Procedures..............................................30

PART II  OTHER INFORMATION....................................................31

Item 1.  Legal Proceedings....................................................31

Item 2.  Unregistered Sales of Securities and Use of Proceeds.................32

Item 6.  Exhibits.............................................................33


                                       2
<PAGE>


                                     PART I
                              FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

<TABLE>
                      SEALIFE CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                             June 30, 2005 and 2004

<CAPTION>
                                                            June 30,          June 30,
                                                             2005               2004
                                                          -----------       -----------
<S>                                                       <C>               <C>
                      ASSETS
Current Assets
   Cash ............................................      $    17,255       $    32,556
   Cash in escrow ..................................           25,000              --
   Inventory .......................................           96,885             6,000
   Accounts Receivable .............................            3,248              --
   Prepaid expenses ................................           67,928           366,665
                                                          -----------       -----------
        Total Current Assets .......................          210,316           405,221
Other Assets
   Technology ......................................        1,735,309         1,735,309
   Less: accumulated amortization ..................         (314,845)         (199,153)
                                                          -----------       -----------
                                                            1,420,464         1,536,156
                                                          -----------       -----------

        Total Assets ...............................      $ 1,630,780       $ 1,941,377
                                                          ===========       ===========

       LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
   Notes payable ...................................      $   179,595       $   130,000
   Accounts payable ................................           99,099            57,666
   Accounts payable - shareholders .................          127,944            61,130
   Accrued expenses ................................          202,483              --
   Accrued wages ...................................          542,297           130,810
   Accrued interest ................................           25,340             7,083
   Accrued payroll taxes ...........................            8,382             8,382
   Sales deposits ..................................            6,000              --
   Current portion of long-term debt ...............           11,119             3,291
   Other Current Liabilities .......................           23,000              --
        Total Current Liabilties ...................        1,225,259           398,362
Long-Term Debt
   Notes payable ...................................          307,197           315,025

Stockholders' Equity
   Common stock
   Additional paid in capital ......................            1,939             1,454
   Deficit accumulated during the development stage         5,773,491         3,855,368
        Total Stockholders' Equity .................       (5,677,105)       (2,628,832)
                                                          -----------       -----------
                                                               98,324         1,227,990
                                                          -----------       -----------
          Total Liabilities and Stockholders' Equity
                                                          $ 1,630,780       $ 1,941,377
                                                          ===========       ===========
</TABLE>

See accompanying notes and accountants report.


                                       3
<PAGE>


<TABLE>
                      SEALIFE CORPORATION AND SUBSIDIARIES
                        CONSOLIDATED STATEMENT OF INCOME
           For the Three and Six Months Ended June 30, 2005 and 2004

<CAPTION>
                                              THREE MONTHS                          THREE MONTHS
                                                  ENDED         JUNE 30, 2005           ENDED         JUNE 30, 2004
                                             JUNE 30, 2005       YEAR TO DATE      JUNE 30, 2004       YEAR TO DATE
                                              ------------       ------------       ------------       ------------
<S>                                           <C>                <C>                <C>                <C>
Sales ..................................      $     41,279       $     77,331       $     11,926       $     24,742

Cost of sales ..........................            25,564             45,613              7,411             16,599
                                              ------------       ------------       ------------       ------------

     Gross Profit ......................            15,716             31,718              4,515              8,143

Sales and marketing ....................           103,178            230,630             17,343             21,430
General and administrative .............           327,270          1,005,908            134,199            215,726
                                              ------------       ------------       ------------       ------------
                                                   430,448          1,236,538            151,542            237,156
                                              ------------       ------------       ------------       ------------

Net Loss ...............................      $   (414,732)      $ (1,204,820)      $   (147,027)      $   (229,013)
                                              ============       ============       ============       ============

Loss per share
     Weighted average shares outstanding        18,288,484         18,926,633
     Loss per share ....................             (0.02)             (0.06)
</TABLE>

See accompanying notes and accountants report.


                                       4
<PAGE>


<TABLE>
                      SEALIFE CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
            For the Six Months Ended June 30, 2005 and June 30, 2004

<CAPTION>
                                                            THREE MONTHS                       THREE MONTHS
                                                               ENDED        JUNE 30, 2005          ENDED        JUNE 30, 2004
                                                          JUNE 30, 2005      YEAR TO DATE     JUNE 30, 2004      YEAR TO DATE
                                                            -----------       -----------       -----------       -----------
<S>                                                         <C>               <C>               <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES
       Net Loss ......................................      $  (414,732)      $(1,204,820)      $  (147,027)      $  (229,013)
       Adjustments to reconcile net loss to net
         cash provided used in operating activities
            Amortization .............................           28,923            57,846            28,923            57,846
            Stock issued for services ................          154,229           613,246              --                --
         Changes in Current Assets and liabilities:
            (Increase) Decrease in Accounts receivable           13,149            (3,247)             --                --
            (Increase) in Inventories ................          (57,247)          (72,580)             --                --
            Decrease in Prepaid expenses .............           87,443            34,737            73,335            73,335
            Increase in Accounts payable .............           26,295            76,867             3,135             3,644
            Increase in Accrued expenses .............            8,273           202,483              --                --
            Increase in Accrued wages ................          105,000           195,237            66,250            66,250
            Increase in Accrued interest .............            7,496            12,892             2,499             2,499
            Increase in Accrued payroll taxes ........             --                --                --               8,382
            Increase in Sales deposits ...............            6,000             6,000              --                --
                                                            -----------       -----------       -----------       -----------
            NET CASH (USED) BY
                 OPERATING ACTIVITIES ................          (35,173)          (81,341)           27,115           (17,057)


CASH FLOWS FROM FINANCING ACTIVITIES
       Sale of Common stock ..........................             --              60,000              --              27,000
       Increase (decrease) in Notes payable ..........           27,095            10,245              --              14,500
       (Decrease) Increase in Accounts payable SH ....           36,189            32,414              --                --
                                                            -----------       -----------       -----------       -----------
            NET CASH PROVIDED BY
                 FINANCING ACTIVITIES ................           63,284           102,659              --              41,500
                                                            -----------       -----------       -----------       -----------
NET INCREASE (DECREASE) IN CASH ......................           28,111            21,318            27,115            24,443
CASH AT BEGINNING OF PERIOD ..........................           14,144            20,937             5,441             8,113
                                                            -----------       -----------       -----------       -----------
CASH AT END OF PERIOD ................................      $    42,255       $    42,255       $    32,556       $    32,556
                                                            ===========       ===========       ===========       ===========
</TABLE>

See accompanying notes and accountant's report.


                                       5
<PAGE>


                               SEALIFE CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                                  JUNE 30, 2005


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

HISTORY:

Sealife Corp., a Nevada  corporation  ("Sealife  Nevada"),  was  incorporated in
2002. Also in 2002 Sealife Nevada became the sole  shareholder of SeaLife Marine
Products,  Inc.,  a  California  corporation.   The  subsidiary  was  formed  to
concentrate on certain marine product applications of its technology.

On June 30, 2002 SeaLife Nevada entered into an agreement with the  shareholders
of Division G, Inc. to exchange 100% of the stock of Division G, Inc. for shares
of SeaLife  Nevada's common stock.  The agreement became effective July 1, 2002.
At the time of acquisition  Division G, Inc.'s assets  consisted of ownership of
all rights in  perpetuity  to ProTerra  AG, a soil  conditioner,  Grease Bust, a
grease  treatment  and cleaner,  Soil Rescue,  a soil  Bio-remediation  product,
OilEx,  a soil  detoxification  and  rebuilding  product,  and  Muni-Mix a sewer
clean-up and  detoxification  product.  All products were in the early stages of
development. Division G, Inc. had no liabilities at the time of acquisition.

On July 31, 2002  Sealife  Nevada  formed a  wholly-owned  subsidiary,  ProTerra
Technologies,  Inc.,  a California  corporation.  The  subsidiary  was formed to
concentrate on the agricultural product applications.

On December 20, 2002,  SeaLife  Nevada was  acquired by SeaLife  Corporation,  a
Delaware corporation (the "Company"),  formerly Integrated Enterprises,  Inc., a
public,  reporting  corporation,  pursuant  to the  terms  of a  Share  Exchange
Agreement.  The Company was a shell at the time of the acquisition and therefore
the acquisition was treated as a reverse merger whereby the acquired  company is
treated as the acquiring  company for accounting  purposes.  At the same time as
the share exchange, the Company effected a 15 to 1 reverse stock split.

A history of the Company is as follows:

Sealife  Corporation,  formerly  Integrated  Enterprises,  Inc.,  formerly  Vast
Technologies  Holding Company,  Inc., formerly Fraser Realty Group, Inc., is the
successor  to  Fraser  Mortgage   Investments  (the  Trust),  an  unincorporated
association  in the  form  of a  business  trust  organized  in Ohio  under  the
Declaration of Trust dated May 7, 1969. At a special meeting of the shareholders
of the Trust  held on August  28,  1984 a plan of  reorganization  was  approved
pursuant to which:

         1.       All of the assets of the Trust were sold to FRG;
         2.       FRG assumed all of the Trust's liabilities and obligations;
         3.       Each issued and  outstanding  share of the Trust was converted
                  into one share of FRG common stock; and
         4.       The Trust was terminated.

The  purpose  of the  proposed  reorganization  was to  convert  the  Trust to a
business  organization  taxable as an  ordinary  corporation,  instead of a real
estate  investment  trust,  under  Federal  income tax laws.  Unless the context
otherwise requires, the term FRG includes its predecessor, the Trust.


                                       6
<PAGE>


                               SEALIFE CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

FRG  invested in real estate and  mortgage  loans.  FRG was  organized as a real
estate trust,  primarily for the purpose of making  passive  investments in real
estate and passing  through the income  realized  from such  investments  to its
shareholders.  From its  inception,  FRG  financed  its real  estate  investment
operations  principally  through  sale of  common  stock,  and  short-term  debt
financing,  including both bank borrowings and the issuance of commercial paper.
FRG  saw  its  real  estate  investments  evolve  from  principally   short-term
construction loans to a mix of variable and fixed-rate mortgage loans of which a
significant  portion  consists of mortgage  positions on improved and unimproved
land held by investors for development purposes.  Accordingly, FRG's investments
in  mortgage  loans  represent  long-term  assets  with  the  realization  dates
dependent upon the equity holder's ability to complete  development  projects or
obtain refinancing from other sources.  At the same time, bank notes payable and
commercial  paper  outstanding were all short-term  borrowings  renewable at the
option of the note  holders.  FRG  relied on these  short-term  borrowings,  the
intermittent  repayment  of  loans  and the  refinancing  or  sale of  portfolio
investments in order to meet its current  obligations.  During fiscal 1989, cash
provided from these sources was wholly  inadequate to provide working capital to
fund operations.  Management was unable to secure  additional  financing or find
other  means of  obtaining  needed cash in fiscal 1990 to permit FRG to meet its
current obligations. Accordingly, management determined that there was no reason
to continue operating and, thus, incurring further losses. FRG has been inactive
since 1990 and has not conducted any business since that time.

On August 4,  1998,  the  Chairman  of the Board and  President  and with  first
receiving the consent,  approval and  authorization of FRG's Board of Directors,
filed  with  the  Secretary  of State  of  Delaware  for  renewal,  revival  and
restoration of the Company's Certificate of Incorporation.

On October 27, 1999 the Company  entered into an  Acquisition  Merger  agreement
with a private  company,  Motorsports USA, Inc. The Company also effected a name
change at that time to  Motorsports  USA,  Inc.  With this  transaction  certain
assets became the property of the Company.  However,  the custody and control of
such  assets  were not  perfected  and the  management  of the  private  company
evidenced tentative compliance with SEC reporting  requirements.  This condition
was considered  intolerable to the Company's  Board of Directors and accordingly
on August 1, 2000 the  transaction  was rescinded.  The Company also changed its
name on June 1,  2000 to Vast  Technologies  Holding  Company.  Accordingly  the
enclosed  financial  statements were prepared as if the merger with  Motorsports
USA, Inc. had not taken place.

On June 11, 2001 the Company changed its name to Integrated  Enterprises,  Inc.,
issued  12,000,000  shares of Common Stock for  services  and reverse  split its
Common  Shares,  one new common share for each ten old common  shares with a par
value of $ 0.0001 per share.

On December 20, 2002 the Company acquired SeaLife Nevada.

Basis of Consolidation:

The accompanying  consolidated  financial statements include the accounts of the
Company,  SeaLife Nevada, a wholly-owned  subsidiary of the Company, and SeaLife
Marine Products, Inc., ProTerra Technologies, Inc. and Division G, Inc., SeaLife
Nevada's  three  subsidiaries.   All  significant   inter-company  accounts  and
transactions, if any, have been eliminated in consolidation.

Cash and Cash Equivalents:

For the  purposes of the  Statement  of Cash Flows,  the Company  considers  all
short-term debt securities to be cash equivalents.


                                       7
<PAGE>


                               SEALIFE CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

Income Taxes:

The Company  accounts for income taxes under a method,  which requires a company
to recognize  deferred tax assets and  liabilities  for the expected  future tax
consequences  of events  that  have been  recognized  in a  company's  financial
statements  or  tax  returns.  Under  this  method,   deferred  tax  assets  and
liabilities  are  determined  based  on the  difference  between  the  financial
statements  carrying  amounts  and tax basis of  assets  and  liabilities  using
enacted tax rates.  The Company  presently  prepares  its tax return on the cash
basis and its financial  statements on the accrual basis. No deferred tax assets
or liabilities  have been  recognized at this time,  since the Company has shown
losses for both tax and financial  reporting.  The Company's net operating  loss
carry forward at June 30, 2005 is approximately $5,677,000.

Amortization:

The Company  provides for  amortization of the Marine Product  Technologies  and
ProTerra  Technologies  (each as defined in Note 2) utilizing the  straight-line
method to apportion costs over a 15 year estimated life.

Use of Estimates:

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect certain  reported amounts and  disclosures.  Accordingly,  actual results
could differ from those estimates.

Development Stage:

Until  January 1, 2005,  the  Company,  together  with its  subsidiaries,  was a
development  stage company as defined under  Statements of Financial  Accounting
Standards No. 7.

NOTE 2 - TECHNOLOGIES

SeaLife  Marine  Products,  Inc.  entered  into an asset  purchase  agreement to
acquire  certain  technologies  (the "Marine  Product  Technologies")  from Gael
Himmah  effective  June 30,  2002.  The  purchase  price for the Marine  Product
Technologies was $1,335,309.  Under this purchase agreement the Company acquired
the following:

     1.  Parents,  patent application rights for EPA registration number 70214-1
         and all modifications, enhancements and improvements thereon.
     2.  All rights in  perpetuity,  including  but not limited to SeaLife 1000,
         SeaLife 2000 (now known as SeaLife 1000 OutDrive(TM)), and SeaLife 3000
         (now known as SeaLife 100 XP(TM)),  present and future  marine  coating
         and  all  modifications,   variations,  enhancements  and  improvements
         thereon.
     3.  Full power to enforce its ownership interests.

SeaLife 1000 is a  solvent-based,  anti-fouling  coating for underwater  use. It
provides a unique  anti-shell,  anti-algae,  anti-fungus and anti-rust  coating,
with competitive results.

SeaLife 1000 OutDrive(TM) is a solvent-based, anti-fouling coating for submerged
marine use.


                                       8
<PAGE>


                               SEALIFE CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

SeaLife 1000 XP(TM) is a solvent-based coating with advanced anti-rust additives
for above water applications.

The Marine Product  Technologies are being amortized on the straight-line  basis
over a 15-year  life.  It is  management's  opinion  that 15 years  represents a
reasonable estimate of product life at this time.

On September 17, 2003 the Company  entered into an agreement with Gael Himmah to
purchase all proprietary  rights and interests in four  additional  products and
technologies  (the  "ProTerra  Technologies").  Two  of  the  products  are  for
agricultural  applications  and the other two appeal to a broader market and are
for soil  recovery.  The  purchase  price was $400,000 and was paid with 400,000
shares of the Company's common stock. These proprietary rights and interests are
being amortized on a straight-line basis over a 15-year life. It is management's
opinion that 15 years  represents  a reasonable  estimate of the product life at
this time.

Amortization  expense  for the  Marine  Product  Technologies  and the  ProTerra
Technologies for the periods is as follows:

                                    THREE MONTH PERIOD ENDED:
                               JUNE 30, 2005         JUNE 30, 2004
                               -------------         -------------
         Amortization              $28,923               $28,923


Future amortization expense for the next five years is as follows:

                  2005              $115,688
                  2006              $115,688
                  2007              $115,688
                  2008              $115,688
                  2009              $115,688

NOTE 3 - NOTES PAYABLE

Current Notes Payable:

On January 9, 2004,  the Company,  in  connection  with a  consulting  contract,
issued a $100,000  note to one of its  consultants.  The note was due in full on
January  9, 2005,  and is  unsecured.  The  interest  rate is 7% per annum.  The
balance  of the note at June 30,  2005 and 2004 was  $110,300.  The  Company  is
currently in default under this note.

On June 14, 2004,  the Company  entered into a $30,000 note with an  individual.
The note was due June 14, 2005, is unsecured, and does not call for any payments
until  maturity.  The interest rate is 7% per annum.  The balance of the note at
June 30, 2005 and 2004 was $32,160.  The Company is  currently in default  under
this note.

On August 4, 2004,  the Company  entered into a $35,000 note with an individual.
The  note  was due  September  15,  2004,  is  unsecured,  and does not call for
payments  until  maturity.  The interest  rate is 36% per annum.  The Company is
currently in default under this note. The balance of the note including interest
at June 30, 2005 and 2004 was $49,595 and $0 respectively.

During  the three  month  period  ended  June 30,  2005,  the  Company  issued a
five-year note for $14,500 at a 5% annual  interest rate to its director,  chief
executive office and chief financial officer,


                                       9
<PAGE>


                               SEALIFE CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

Robert McCaslin, as evidence of prior loans made to the Company.

Long - Term Debt - Notes Payable:

In connection  with the purchase of the Marine Product  Technologies on June 30,
2002,  SeaLife Nevada issued a ten-year note for  $1,335,309.  The note is to be
repaid  based on the  Company's  sales,  i.e. at 5% of the first  $3,000,000  of
sales,  and at 2.5% on the sales in excess of that  amount,  until paid in full.
The note payments are to be made monthly and the note bears interest at the rate
of 7% per annum.  The note may be  converted  at the  option of the holder  into
common stock of the company at a conversion  price which is equivalent to 80% of
the market price,  based on the average bid price of the Company's  common stock
over the  previous  thirty  (30) days.  On January 2, 2003 the holder  converted
$1,000,000  of the note into  1,000,000  shares of  SeaLife  Corporation  common
stock.  The  balance  of the note at both  June 30,  2005 and June 30,  2004 was
$303,816.  At June 30, 2005,  there remained $11,119 of past due interest on the
note.  The note has certain  default  provisions  and stated  period of times to
correct the default.  The note holder has not  formally  notified the Company of
default.  Because of the  repayment  schedule  of the note and an  inability  to
accurately forecast future sales,  maturities on long-term debt annually can not
be computed.

NOTE 4 - COMMON STOCK

The Company has 100,000,000  shares of $.0001 par value Common Stock authorized.
At June 30, 2005 and June 30, 2004 the Company had  19,385,076,  and  14,536,155
shares outstanding respectively.

During the  quarter  ended June 30, 2005 the Company  issued  643,283  shares of
Common Stock for services. The shares issued and value assigned for these shares
are as follows:

SERVICE                                                SHARES             VALUE
--------------------------------------------          --------          --------
Business Consulting ........................           444,768          $108,184
Legal Services .............................                 0                 0
Officer Salaries ...........................            34,286             7,845
Product Consulting .........................           164,229            38,200
                                                      --------          --------
Total Stock for Services ...................           643,283          $154,229
                                                      ========          ========

NOTE 5- PREFERRED STOCK

The Company had 2,000,000 shares of convertible  preferred stock  outstanding at
December 20,  2002,  the date the Company  acquired  SeaLife  Nevada.  These had
conversion  rights of 10 shares of common for each  shares of  preferred.  In an
agreement  signed  June 24,  2003 the  owners of these  shares  agreed to cancel
1,840,000 shares of preferred stock. The remaining 160,000 shares were converted
into  1,600,000  shares of common stock of the Company of which  300,000  shares
were  conveyed to the original  shareholders  of SeaLife  Nevada,  including the
current Directors of the Company

NOTE 6 - CONSULTING AGREEMENT

On June  30,  2002,  in  connection  with the  purchase  of the  Marine  Product
Technologies,  SeaLife  Nevada  entered  into a  consulting  agreement  with the
developer of the Marine Product Technologies, Gael Himmah, for his advice in the
use and  improvement of such assets.  This agreement was assigned to the Company
and amended in January 2003.  Mr. Himmah is to provide all necessary  support in
complying


                                       10
<PAGE>


                               SEALIFE CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

with government  regulations,  in solving specific  marketing and  environmental
problems,  in product  improvement,  in  developing  operational  protocols,  in
advising and support on the operation of the Company's business and to assist in
the purchase or manufacture of the Company's  products.  The agreement calls for
the consultant to receive  $10,000 per month from September 1, 2002 to April 15,
2004,  and $12,000 per month  thereafter  until  September  1, 2007.  During the
quarter ended November 30, 2003 the Company entered into an additional agreement
with this  consultant  to provide  services  through  December  31,  2003 for an
additional  300,000  shares  of the  Company's  common  stock.  During  2004 the
consultant agreed to accept 100,000 shares of the Company's common stock in lieu
of  compensation  owed to him pursuant to the consulting  agreement.  During the
three and six months ended June 30,  2005,  Mr.  Himmah  accepted  164,229,  and
202,802,  shares of common stock,  respectively in lieu of compensation  owed to
him pursuant to the consulting agreement.

NOTE 7 - GOING CONCERN

The  Company has not  generated  significant  revenues or profits to date.  This
factor  among  others may  indicate  the Company will be unable to continue as a
going concern.  The Company's  continuation  as a going concern depends upon its
ability to  generate  sufficient  cash flow to conduct  its  operations  and its
ability to obtain additional sources of capital and financing.  The accompanying
consolidated  financial  statements  do not include any  adjustments  that might
result from the outcome of this uncertainty.

NOTE 8 - RELATED PARTIES

At June 30, 2005 and 2004, the Company owed Robert McCasin and J.P. Heyes,  each
directors,  executive officers, and major shareholders of the Company,  $127,944
and $61,130 respectively for monies advanced to the Company. The amounts due are
non-interest bearing and have no priority in liquidation.

The Company owed Mr. McCaslin and Ms. Heyes an aggregate of $487,291 and $72,893
for wages at June 30, 2005 and 2004, respectively.

On January 1, 2004 the Company  entered into a 5-year  employment  contract with
Mr. McCaslin, the President of the Company. The agreement defines the duties and
responsibilities of the position,  provides an annual compensation of $300,000 a
year,  with certain  vacation and sick days. The Company is required to maintain
an office and certain death benefits during the term of the contract. On October
29, 2004 the contract was amended to provide for annual compensation of $200,000
per year.

On January 1, 2004 the Company  entered into a 4-year  employment  contract with
Ms. Heyes, the  Vice-President of the Company.  The agreement defines the duties
and  responsibilities  of the  position,  provides  an  annual  compensation  of
$300,000, with annual reviews and the participation in an incentive program when
adopted.  On October  29,  2004 the  contract  was amended to provide for annual
compensation of $100,000 per year.


                                       11
<PAGE>


                               SEALIFE CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

On June 14, 2004 the Company  entered  into an  employment  contract  with Barre
Rorabaugh,  the President of the Company's  subsidiary,  Sealife Marine, for the
period extending through December 31, 2008. The agreement defines the duties and
responsibilities  of the position,  provides an annual  compensation of $150,000
with annual reviews and the  participation in an incentive program when adopted.
During the period ended June 30, 2005 the Company issued 34,286 shares of common
stock to the President of SeaLife Marine as  compensation  pursuant to the terms
of his employment agreement.

On June  30,  2002,  in  connection  with the  purchase  of the  Marine  Product
Technologies,  SeaLife  Nevada  entered  into a  consulting  agreement  with the
developer of the Marine Product Technologies, Gael Himmah, for his advice in the
use and  improvement of such assets.  This agreement was assigned to the Company
and amended in January 2003.  Mr. Himmah is to provide all necessary  support in
complying  with  government  regulations,  in  solving  specific  marketing  and
environmental  problems,  in  product  improvement,  in  developing  operational
protocols,  in advising and support on the operation of the  Company's  business
and to assist in the purchase or  manufacture  of the  Company's  products.  The
agreement  calls for the consultant to receive  $10,000 per month from September
1, 2002 to April 15, 2004, and $12,000 per month  thereafter  until September 1,
2007.  During the quarter  ended  November 30, 2003 the Company  entered into an
additional  agreement with this consultant to provide  services through December
31, 2003 for an additional 300,000 shares of the Company's common stock.  During
2004 the  consultant  agreed to accept  100,000  shares of the Company's  common
stock in lieu of compensation owed to him pursuant to the consulting  agreement.
During  the three and six  months  ended  June 30,  2005,  Mr.  Himmah  accepted
164,229,  and  202,802,  shares  of  common  stock,   respectively  in  lieu  of
compensation owed to him pursuant to the consulting agreement.

The Company  also owed Mr.  Himmah,  $11,119  past due  interest on a note,  and
$303,816, the principal balance of such note at June 30, 2005.

NOTE 9 - SECURITIES AND EXCHANGE COMMISSION INVESTIGATION

On April 5, 2005,  the United States  Securities  and Exchange  Commission  (the
"SEC")  filed a civil  complaint  in the United  States  District  Court for the
District of Colorado  against the Company,  Robert McCaslin (our Chief Executive
Officer and Chief  Financial  Officer),  and several third parties not currently
affiliated with the Company,  alleging  violations of the Securities Act of 1933
and the Securities  Exchange Act of 1934 in connection with events that occurred
in 2002 and 2003.

The complaint  alleges that the Company,  Mr. McCaslin and six other individuals
and  entities  engaged in a "scheme" to defraud the  investing  public by "using
materially false and misleading public statements and manipulative stock trading
to create an artificial  market for, and to sell,  stock in the Company  without
registration or a valid exemption under the federal securities laws."

Specifically,  the complaint  alleges that, Mr. McCaslin  retained Roland Thomas
("Thomas")  to  raise  capital  for the  Company  and  promote  the  company  to
investors,  and to  raise  $400,000  to pay the  principal  shareholders  of the
Company and complete the acquisition  SeaLife Nevada,  and that Thomas devised a
plan with Douglas A. Glaser  ("Glaser")  to meet those  goals.  To carry out the
plan,  the complaint  alleges,  the Company issued one million shares to Thomas,
Glaser,  and an employee of ERT Technology  Corporation (a Delaware  corporation
owned by Thomas, Douglas A. Glaser and Barry S. Griffin ("Griffin"),  Jeffrey A.
Hayden ("Hayden"), and Morgan J. Wilbur III ("Wilbur"), and registered the stock
with the SEC on Form S-8, which registers stock issued to a company's  employees
and  consultants.  However,  the complaint  alleges that Form S-8 was improperly
used because  Thomas and Glaser were  retained to raise  capital for the Company
and to promote and maintain the market for the


                                       12
<PAGE>


                               SEALIFE CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

Company's stock.

The complaint  further  alleges that Thomas and Glaser  transferred  portions of
their  stock to  Griffin,  Hayden,  and Wilbur for  ultimate  sale to the public
through brokerage  transactions.  Between January and March 2003,  Thomas,  ERT,
Glaser,  Griffin,  Hayden,  and Wilbur sold close to one  million  shares of the
Company's common stock. During this time, the Company was engaged in a publicity
campaign using press releases,  a corporate fact sheet, and a business plan. The
latter two documents were  disseminated to brokers and investors and also placed
on the Company's  web site for public  review.  The  complaint  alleges that the
publicity included materially false and misleading  information,  which included
claims (a) that the Company's  products were ready to be marketed,  when in fact
the Company needed capital to conduct  further  testing;  (b) that the Company's
intellectual  property was worth more than $60 million, when in fact the Company
carried  the  property  on its  books at less than  $1.5  million;  and (c) that
projected over $5 million sales during the Company's  first year and significant
profits based on a 70% gross  margin,  when in fact the Company had no basis for
figuring our sales margin and could not meet its projections  without additional
product  testing and  capital.  In  addition,  the  complaint  alleges  that the
Company's  publicity  campaign did not  disclose the $400,000  owed to the prior
principal  shareholders of the Company or the fact that the Company had retained
Thomas  and  Glaser  to sell the  Company's  stock to pay  that  debt and  raise
capital.  Filings made with the Commission on Form 8-K allegedly  compounded the
false and misleading impact of the publicity campaign.

The complaint further alleges that Thomas,  ERT, Glaser,  Griffin,  Hayden,  and
Wilbur used manipulative techniques to distribute our common stock. According to
the complaint, they engaged in wash sales or matched trades, and purchased small
amounts of the stock that they were  distributing to create  artificial  trading
volume and maintain the price for the  distribution.  The complaint also alleges
that the Company made false and  misleading  statements  in an August 2003 press
release  about a  renegotiation  with the prior  principal  shareholders  of the
shell, which helped conceal the earlier fraudulent activities described above.

All  defendants  are charged with  violating  the  securities  registration  and
antifraud  provisions of the federal securities laws,  Sections 5(a) and (c) and
17(a) of the Securities  Act of 1933  ("Securities  Act"),  Section 10(b) of the
Securities  Exchange Act of 1934 ("Exchange  Act"),  and Rule 10b-5  thereunder.
Thomas, ERT, Glaser, Griffin, Hayden, and Wilbur are also charged with violating
Rule 101 of Regulation M, an anti-manipulation  rule that prohibits participants
in a stock  distribution from purchasing stock that they are  distributing.  The
complaint  also  charges that Mr.  McCaslin,  Thomas,  ERT, and Glaser  violated
ownership  reporting  provisions in Sections  13(d)(1) and 16(a) of the Exchange
Act and Rules 13d-1 and 16a-3, and that Thomas, ERT, and Glaser violated Section
13(d)(2) and Rule 13d-2.  Finally,  the complaint  charges that SeaLife violated
the filings  provisions,  Section  13(a) of the Exchange  Act and Rules  13a-11,
13a-13, and 12b-20, and that Mr. McCaslin aided and abetted those violations.

The Commission  seeks permanent  injunctions  against all  defendants,  an order
requiring Thomas, ERT, Glaser,  Griffin, and Wilbur to provide an accounting and
disgorgement,  civil penalties against all defendants,  an  officer-and-director
bar against Mr.  McCaslin,  and penny stock bars against  Thomas,  ERT,  Glaser,
Griffin, Hayden, and Wilbur.

Based on an initial review of the complaint,  the Company and Mr.  McCaslin deny
the  allegations  made by the SEC,  and intend to  continue to  investigate  the
allegations  and vigorously  defend the suit. The Company and Mr.  McCaslin have
been served with the complaint, and no further proceedings are scheduled at this
time.


                                       13
<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

         The information contained in this Form 10-QSB is intended to update the
information  contained  in our Annual  Report on Form  10-KSB for the year ended
December 31, 2004 and presumes  that readers have access to, and will have read,
the  "Management's  Discussion  and  Analysis  or Plan of  Operation"  and other
information contained in such Form 10-KSB and 2005 Form 10-QSB previously filed.
The  following  discussion  and analysis  also should be read  together with our
condensed  consolidated  financial  statements  and the  notes to the  condensed
consolidated financial statements included elsewhere in this Form 10-QSB.

         THIS  DISCUSSION  SUMMARIZES  THE  SIGNIFICANT  FACTORS  AFFECTING  THE
CONSOLIDATED OPERATING RESULTS, FINANCIAL CONDITION AND LIQUIDITY AND CASH FLOWS
OF SEALIFE CORPORATION. FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2005 AND THE
THREE AND SIX MONTHS ENDED JUNE 30, 2004. EXCEPT FOR HISTORICAL INFORMATION, THE
MATTERS  DISCUSSED  IN THIS  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OR PLAN OF
OPERATION ARE  FORWARD-LOOKING  STATEMENTS THAT INVOLVE RISKS AND  UNCERTAINTIES
AND ARE BASED UPON  JUDGMENTS  CONCERNING  VARIOUS  FACTORS  THAT ARE BEYOND OUR
CONTROL.  ACTUAL  RESULTS COULD DIFFER  MATERIALLY  FROM THOSE  PROJECTED IN THE
FORWARD-LOOKING  STATEMENTS  AS A RESULT OF,  AMONG  OTHER  THINGS,  THE FACTORS
DESCRIBED BELOW UNDER THE CAPTION "CAUTIONARY STATEMENTS AND RISK FACTORS."

OVERVIEW

         SeaLife Corporation was formed as a Delaware  corporation in 1984 under
the name Fraser  Realty  Group.  We operated as a real estate  investment  trust
until 1990,  when management was unable to secure  additional  financing or find
other means of obtaining needed cash to permit us to meet our obligations.  As a
result, we ceased operations and remained inactive until December, 2002.

         On December 17, 2002,  pursuant to an Exchange Agreement dated June 30,
2002, we acquired all of the issued and  outstanding  shares of SeaLife Corp., a
Nevada Corporation ("SeaLife Nevada"), in exchange for a substantial majority of
the shares of our common stock (the  "Acquisition").  Our stockholders  retained
their 274,554 shares of common stock which were issued and outstanding  prior to
the consummation of the Acquisition. Concurrent with the Acquisition, we changed
our name from Integrated  Enterprises,  Inc. to SeaLife Corporation,  our former
directors  and  officers  resigned,  and the  directors  and officers of SeaLife
Nevada. became our directors and officers. Also concurrent with the acquisition,
we effected a 15-to-1 reverse stock split.

         The  Acquisition  resulted  in a change of control  of, with the former
stockholders  of SeaLife Nevada  acquiring a substantial  majority of our common
stock  immediately  following  the closing of the  Acquisition.  Therefore,  the
Acquisition  was  accounted  for as a  reverse  merger,  pursuant  to which  the
accounting  basis  of  SeaLife  Nevada  continued  unchanged  subsequent  to the
transaction  date.  Accordingly,  the  pre-transaction  financial  statements of
SeaLife Nevada are now our historical financial statements.

         Sealife  Nevada was organized in April of 2002 to acquire,  develop and
market certain proprietary  products invented by Gael Himmah. At the time of the
Acquisition,  Sealife Nevada owned all of the  outstanding  stock of Division G,
Inc., a Nevada  corporation  ("Division G"),  Sealife Marine  Products,  Inc., a
California  corporation ("Sealife Marine"),  and ProTerra  Technologies,  Inc. a
California corporation ("ProTerra").  As a result of the Acquisition,  we became
the parent and sole shareholder of Sealife Nevada,  which, in turn, was the sole
shareholder of Division G, Sealife Marine and ProTerra.


                                       14
<PAGE>


         Our vision is to develop,  market and supply eco-friendly products that
can  solve  complex  environmental   problems  with  simple  natural  solutions,
establishing  the  environmentally  safe choice as the right  choice in specific
markets.

         Our goal is to establish  ourself as the global  leader in  "probiotic"
technologies.  Probiotic  technologies  refer to technologies  and products that
work in  "partnership  with  nature"  without  harming  the  environment  in its
targeted  markets.  We believe that worldwide demand for development of products
that are not  only  safe  for the  environment  but will  also  help  clean  the
environmental  damage caused by decades of use and disposal of deadly toxins and
the overuse of  pesticides  and  fertilizers,  is growing,  and will continue to
grow.  We believe that a large  percentage  of the products in use today can and
will be replaced by effective, environmentally safe equivalents.

         We developed a line of products utilizing such "probiotic" technologies
for the marine, agricultural and remediation markets. We began substantial sales
and  marketing  efforts in the first  quarter of 2005.  In  anticipation  of our
intended growth and the introduction of additional products to the market in the
future, we have implemented a corporate  structure whereby each market is served
by a separately operated subsidiary or division. Our marine products business is
operated  by  our  indirect   wholly-owned   subsidiary,   SeaLife  Marine.  Our
agricultural  products  business is operated  by the our  indirect  wholly-owned
subsidiary, ProTerra. Our remediation product business is operated as a. We also
plan on establishing a research and development  division that will focus on the
testing  and   development  of  existing  and  new  products  for  each  of  our
subsidiaries and divisions  provided  sufficient capital can be obtained to fund
such division. We have structured our operations in this manner to accommodate a
range of products for  specific  markets that have been and will be developed by
us.

CRITICAL ACCOUNTING POLICIES, JUDGMENTS AND ESTIMATES

         Our discussion and analysis of our financial  conditions and results of
operations are based upon our consolidated financial statements, which have been
prepared in accordance  with  generally  accepted  accounting  principles in the
United States.  The preparation of financial  statements  require  management to
make  estimates  and  judgments  that affect the reported  amounts of assets and
liabilities,  revenues and expenses and disclosures on the date of the financial
statements. On an on-going basis, we evaluate our estimates,  including, but not
limited  to,  those  related  to  revenue  recognition.   We  use  authoritative
pronouncements,  historical  experience  and other  assumptions as the basis for
making judgments.  Actual results could differ from those estimates.  We believe
that the following  critical  accounting  policies  affect our more  significant
judgments  and  estimates  in  the  preparation  of our  consolidated  financial
statements.

         IMPAIRMENT  OF  GOODWILL.  We adopted SFAS No. 142 for all goodwill and
other intangible assets recognized in our statement of financial  position as of
May 31,  2004.  This  standard  changes  the  accounting  for  goodwill  from an
amortization method to an impairment-only  approach.  Our technologies are being
amortized over 15 years. This is management's best estimate of the technologies'
life at this time.

         REVENUE  RECOGNITION.  Revenue  is  recognized  on the day a product is
shipped and invoiced.

         ACCOUNTS  RECEIVABLE.  Accounts  receivable balances are evaluated on a
continual   basis  and   allowances,   if  any,  are  provided  for  potentially
uncollectible  accounts based on management's estimate of our ability to collect
such accounts. If the financial condition of a customer deteriorates,  resulting
in an impairment of its ability to make payments, an additional allowance may be
required. Allowance adjustments, if any, are charged to operations in the period
in which the facts that give rise to the  adjustments  become known. To date, we
have not had any customer whose payment was considered


                                       15
<PAGE>


past  due,   and  as  such,   have  not   recorded  any  reserves  for  doubtful
collectibility.

         STOCK-BASED COMPENSATION. We account for stock-based compensation using
Accounting Principles Board ("APB") Opinion No. 25, "ACCOUNTING FOR STOCK ISSUED
TO EMPLOYEE."

RECENT ACCOUNTING PRONOUNCEMENTS

         In December 2004, the Financial  Accounting  Standards  Board, or FASB,
issued SFAS No. 123R "SHARE-BASED PAYMENT," a revision to FASB No. 123. SFAS No.
123R replaces existing  requirements  under SFAS No. 123 and APB Opinion No. 25,
and  requires  public  companies  to  recognize  the cost of  employee  services
received in exchange for equity instruments,  based on the grant-date fair value
of those instruments,  with limited  exceptions.  SFAS No. 123R also affects the
pattern in which  compensation  cost is recognized,  the accounting for employee
share purchase  plans,  and the accounting for income tax effects of share-based
payment transactions. For small-business filers, SFAS No. 123R will be effective
for  interim  periods  beginning  after  December  15,  2005.  We are  currently
determining  what  impact the  proposed  statement  would have on our results of
operations and financial position.

         The  FASB  has  proposed  FASB  Staff  Position  No.  SFAS  No.  109 a,
"APPLICATION OF FASB STATEMENT NO. 109, ACCOUNTING FOR INCOME TAXES, FOR THE TAX
DEDUCTION PROVIDED TO U.S. BASED MANUFACTURERS BY THE AMERICAN JOBS CREATION ACT
OF 2004." On October 22,  2004,  the  AMERICAN  JOBS  CREATION  ACT OF 2004 (the
"ACT") was signed into law by the  President.  This Act  includes tax relief for
domestic  manufacturers by providing a tax deduction up to 9 percent (when fully
phased-in) of the lesser of (a)  "qualified  production  activities  income," as
defined  in the  Act,  or (b)  taxable  income  (after  the  deduction  for  the
utilization of any net operating loss carry forwards).  As a result of this Act,
an issue has arisen as to whether this  deduction  should be accounted  for as a
special  deduction or a tax rate reduction  under  Statement 109. The FASB staff
believes that the domestic manufacturing deduction's characteristics are similar
to special deductions because the domestic  manufacturing  deduction is based on
the future  performance  of specific  activities,  including the level of wages.
Accordingly,  the FASB staff believes that the deduction  provided for under the
Act should be accounted for as a special  deduction in accordance with Statement
109 and not as a tax rate  reduction.  This provision of the Act is not expected
to have an impact on our financial statements.

         In November 2004, the FASB issued FASB Statement No. 151, which revised
ARB No.43,  relating  to  inventory  costs.  This  revision  is to  clarify  the
accounting  for abnormal  amounts of idle facility  expense,  freight,  handling
costs and wasted material  (spoilage).  This Statement requires that these items
be  recognized as a current  period  charge  regardless of whether they meet the
criterion  specified  in ARB  43.  In  addition,  this  Statement  requires  the
allocation of fixed production  overheads to the costs of conversion be based on
normal  capacity of the production  facilities.  This Statement is effective for
financial  statements for fiscal years  beginning  after June 15, 2005.  Earlier
application  is permitted  for  inventory  costs  incurred  during  fiscal years
beginning  after the date this  Statement is issued.  Management  believes  this
Statement will have no impact on our financial statements once adopted.

         In December  2004, the FASB issued FASB Statement No. 152, which amends
FASB  Statement No. 66,  Accounting  for Sales of Real Estate,  to reference the
financial  accounting  and  reporting  guidance  for  real  estate  time-sharing
transactions  that is provided in AICPA  Statement  of  Position  ("SOP")  04-2,
ACCOUNTING FOR REAL ESTATE TIME-SHARING TRANSACTIONS. This Statement also amends
FASB Statement No. 67,  ACCOUNTING  FOR COSTS AND INITIAL  RENTAL  OPERATIONS OF
REAL ESTATE PROJECTS,  to state that the guidance for (a) incidental  operations
and (b)  costs  incurred  to  sell  real  estate  projects  does  not  apply  to
real-estate time-sharing  transactions.  The accounting for those operations and
costs is


                                       16
<PAGE>


subject to the guidance in SOP 04-2.  This  Statement is effective for financial
statements for fiscal years beginning after June 15, 2005.  Management  believes
this Statement will have no impact on our financial statements once adopted.

         In  December  2004,  the FASB  issued  FASB  Statement  No.  153.  This
Statement  addresses the  measurement  of exchanges of nonmonetary  assets.  The
guidance in APB Opinion No. 29,  ACCOUNTING  FOR  NONMONETARY  TRANSACTIONS,  is
based on the principle that  exchanges of nonmonetary  assets should be measured
based on the fair value of the assets  exchanged.  The guidance in that Opinion,
however,  included certain  exceptions to that principle.  This Statement amends
Opinion 29 to  eliminate  the  exception  for  nonmonetary  exchanges of similar
productive  assets and  replaces it with a general  exception  for  exchanges of
nonmonetary assets that do not have commercial substance. A nonmonetary exchange
has commercial  substance if the future cash flows of the entity are expected to
change  significantly  as a result of the exchange.  This Statement is effective
for financial statements for fiscal years beginning after June 15, 2005. Earlier
application is permitted for nonmonetary asset exchanges  incurred during fiscal
years beginning after the date of this Statement is issued.  Management believes
this Statement will have no impact on our financial statements once adopted.

COMPARISON  OF THREE  MONTHS  ENDED JUNE 30, 2004 VERSUS THREE MONTHS ENDED JUNE
30, 2005

RESULTS OF OPERATIONS

         REVENUES

         We had revenues of $41,279 for the three months ended June 30, 2005 and
revenues of $11,926 for the same period ending in 2004.  All of the revenues for
the three  months ended June 30, 2005 are  attributable  to sales of our SeaLife
Marine coating products to four (4)  distributors.  Sales are expected to become
more  significant  over the  balance  of fiscal  2005 as our  marketing  efforts
continue,  we enter into  relationships  with additional  distributors,  and our
SeaLife  Marine  coating  and  other  product  lines  are  approved  for sale in
additional  territories.  However,  the rate of this increase will depend on the
success of our marketing efforts, regulatory acceptance of our products, and our
ability to raise additional capital to support continued operations.

         OPERATING EXPENSES

         Our Cost of Sales for the three  months ended June 30, 2005 and for the
same period ending in 2004, was $25,564 and $7,411, respectively.  Cost of sales
over these  periods  consisted of direct  costs for goods and services  directly
used in the production of our SeaLife Marine coating  products.  The increase in
Cost of Sales is directly  attributable  to our  increase in products  and sales
over the 2005 period. Our goal is to lower costs as a percentage of revenues, in
part, by increasing volume to achieve bulk discounts.

           Beginning  with its financial  statements  for the three month period
ended  February  28,  2004,  the Company  accounted  for  products  delivered by
suppliers,  royalty fees and California  Environmental  Protection Agency tax on
sales as "Cost of Sales" and accounted for sample costs as an expense charged to
Marketing  and Sales.  Sample costs are our costs for products that are provided
at no  cost to our  customers  who  are  testing  such  products.  Prior  to the
financial  statements  for the three month period ended  February 28, 2004,  the
royalty fees and California  Environmental  Protection  Agency tax on sales were
treated as a General/Administrative  Expense and sample costs were accounted for
as a "Cost  of  Sales."  This  difference  in  accounting  does not  affect  our
comparisons  of our three and six month  periods ended June 30, 2005 against our
three and six month  periods  June 30,  2004,  since  royalty  fees,  California
Environmental  Protection  Agency tax on sales and sample  costs were  similarly
accounted for



                                       17
<PAGE>


during such periods.

         We incurred a net loss of $414,732  for the three months ended June 30,
2005 as compared to a net loss of $147,027  for the three  months ended June 30,
2004. This loss solely represents a loss from operations. Our net loss increased
primarily due to a marked increase in sales/marketing and general/administrative
expenses, as described below.

         Total operating expenses consist of general  administrative,  sales and
marketing  expenses.  For the three months ended June 30, 2005,  total operating
expenses were $430,448.  This represents a 284% increase over the same period in
the prior year, in which our total operating expenses were $151,542.

         The major  increase  in general and  administrative  expenses is due to
compensation  for  marketing  and  sales   executives,   implementation  of  our
distribution system, business consulting,  research and development,  industrial
relations  consulting  and our executive  officers'  wages.  The majority of our
expenses  are  recorded  as paid-in  capital,  since the large  majority  of our
administrative  expenses  were paid in the form of common stock instead of cash.
We expect that these expenses will continue to increase.

COMPARISON  OF SIX MONTHS  ENDED JUNE 30, 2004 VERSUS SIX MONTHS  ENDED JUNE 30,
2005

RESULTS OF OPERATIONS

         REVENUES

         We had  revenues of $77,331 for the six months  ended June 30, 2005 and
revenues of $24,742 for the same period ending in 2004.  All of the revenues for
the six months  ended June 30,  2005 are  attributable  to sales of our  SeaLife
marine costing products to four (4)  distributors.  Sales are expected to become
more  significant  over the  balance  of fiscal  2005 as our  marketing  efforts
continue,  we enter into  relationships  with additional  distributors,  and our
SeaLife  marine  coating other product lines are approved for sale in additional
territories.  However,  the rate of this  increase will depend on the success of
our marketing efforts, regulatory acceptance of our products, and our ability to
raise additional capital to support continued operations.

         Our Cost of Sales for the six months  ended  June 30,  2005 and for the
same period  ending in 2004,  was $45,613,  and $16,559,  respectively.  Cost of
sales  over  these  periods  consisted  of direct  costs for goods and  services
directly used in the  production of our SeaLife  Marine  coating  products.  The
increase in Cost of Sales is directly  attributable  to our increase in products
and sales over the 2005 period.  Our gross margin % increased from 32.9% for the
6 month period  ending June 30, 2004 to 41.0% for the 6 month period ending June
30, 2005.  The gross  margin % is expected to increase as our volume  increases.
Our goal is to lower costs as a percentage  of revenues,  in part, by increasing
volume to achieve bulk discounts.

         We incurred a net loss of $1,204,820  for the six months ended June 30,
2005 as  compared to a net loss of  $229,013  for the six months  ended June 30,
2004. This loss solely represents a loss from operations. Our net loss increased
primarily due to a marked increase in sales/marketing and general/administrative
expenses, as described below.

         Total operating expenses consist of general  administrative,  sales and
marketing  expenses.  For the six months  ended June 30, 2005,  total  operating
expenses were  $1,236,538.  This represents a 521% increase over the same period
in the prior year, in which our total operating expenses were $237,156.


                                       18
<PAGE>


         The major  increase  in general and  administrative  expenses is due to
compensation for legal,  marketing and sales  executives,  implementation of our
distribution system, business consulting,  research and development,  industrial
relations  consulting  and our executive  officers'  wages.  The majority of our
expenses  are  recorded  as paid-in  capital,  since the large  majority  of our
administrative  expenses  were paid in the form of common stock instead of cash.
We expect that these expenses to continue to be higher then the 2004 comparative
periods.  However,  expenses of $806,090 in first quarter  ending March 31, 2005
have been reduced in this second quarter ending June 30, 2005 to $430,448 due to
reduced  legal  and  outside  consulting  fees.  However,   the  company  cannot
guaranteed   that  this  level  of  spending  will  not   increase.   As  market
opportunities arise, the company will invest in these opportunities as cash from
operations and outside investment allows.

LIQUIDITY AND CAPITAL RESOURCES

         As of June 30, 2005, we had cash and cash  equivalents of approximately
$42,255 and negative  working capital of approximately  $1,011,137.  We expect a
significant  use of cash  during the  balance of fiscal  2005 as we  continue to
develop our sales and marketing  efforts.  We  anticipate  that our current cash
reserves plus cash we expect to generate from  operations will not be sufficient
to fund our  operational  expenditures  for the balance of 2005. We anticipate a
need to raise  additional  funds by issuing  additional  equity,  the amount and
timing of which will depend on sales volume and increased investment spending in
the areas of  sales/marketing  and  expenses  in the  legal  and  administration
categories.

         If  additional   funds  are  raised  through  the  issuance  of  equity
securities, the current stockholders may experience dilution. Furthermore, there
can be no assurance that additional  financings will be available when needed or
that  if  available,  such  financings  will  include  terms  favorable  to  our
stockholders.  If such  financings  are not  available  when required or are not
available on acceptable  terms,  we may be unable to take  advantage of business
opportunities  or respond to  competitive  pressures,  any of which could have a
material  adverse  effect on our  business,  financial  condition and results of
operations.

         CASH FLOWS

         We currently satisfy our working capital requirements primarily through
sales of equity securities. For the six months ended June 30, 2005, we had a net
increase  in cash of  approximately  $21,318.  Cash  flows from  operating,  and
financing  activities  for the six months ended June 30, 2004 and the six months
ended June 30, 2005 are summarized in the following table:

                                                   SIX MONTHS        SIX MONTHS
                                                     ENDED              ENDED
ACTIVITY:                                        JUNE 30, 2004     JUNE 30, 2005
------------------------------------------         ---------          ---------

Operating activities .....................           (17,057)           (81,341)
Financing activities .....................            41,500            102,659
  Net increase (decrease) in cash ........         $  24,443          $  21,318


         OPERATING ACTIVITIES

         The net cash used in  operating  activities  of  approximately  $81,341
during the six months  ended June 30, 2005 was  primarily  the result of the net
loss of  approximately  $1,204,820;  increase in  receivables  of  approximately
$3,247, decrease in prepaid expenses of approximately $34,737; increases


                                       19
<PAGE>


in  inventory  of  approximately  $72,580,  accounts  payable  of  approximately
$76,867,  sales deposits of $6,000 and accrued expenses totaling  $410,612.  The
non-cash expenses recorded during the period included $57,846 of technology cost
amortization and approximately  $613,246 of non-cash expense for the issuance of
common  stock in  consideration  of  salary  expense  and  consulting  and legal
services..

         The net cash used in  operating  activities  of  approximately  $17,057
during the six months  ended June 30, 2004 was  primarily  the result of the net
loss of  approximately  $229,013,  an increase  in accounts  payable and accrued
expenses  of  approximately   $80,775,  and  decrease  in  prepaid  expenses  of
approximately $73,335. The non-cash expenses recorded during the period included
$57,846 of technology cost amortization.

         FINANCING ACTIVITIES

         Net cash from  financing  activities  was  $102,659  for the six months
ended June 30, 2005, as compared to $41,500 for the six month period ending June
30, 2004.  The  principal use of cash for the six months ended June 30, 2005 was
to fund the net loss from operations for the period.

         On the balance sheet, paid in capital increased from $5,100,452 for the
period ending  December 31, 2004 to $5,773,491  for the three months ending June
30, 2005.  This paid in capital was used to fund services  from our  consultants
and executives.  We anticipate that these services will continue to be funded by
paid in  capital  until  we  reach a sales  level  that  can  support  continued
operations  with cash, or our service  providers are no longer willing to accept
equity in lieu of compensation.

GOING CONCERN

         Our independent  auditor expressed  substantial doubt as to our ability
to  continue  as a going  concern,  in its  report  for the seven  months  ended
December 31, 2004,  based on significant  operating  losses that we incurred and
the fact that we do not have adequate  working capital to finance our day-to-day
operations.

         We currently  plan to raise  additional  capital  through the public or
private  placement  of our common  stock  and/or  private  placement  of debt or
convertible  debentures  in order to meet our ongoing cash needs.  However,  the
additional funding we require may not be available on acceptable terms or at all
and, if obtained, could result in significant dilution. Management also hopes to
begin generating commercial orders for its SeaLife 1000(TM) marine paint product
which would generate additional cash flow.

         To date we have financed  approximately  90% of our expenses by issuing
shares  of  common   stock  in  exchange   for   services  of  legal  and  other
professionals.  The remaining 10% was financed  through private  placement stock
offerings.  In  order  to  expand,  we will be  required  to  obtain  additional
financing either in the form of debt or equity.

         If we cannot obtain adequate  funding or achieve revenues from the sale
of its products,  it could be required to significantly curtail or even shutdown
its operations.

CAUTIONARY STATEMENTS AND RISK FACTORS

         Several   of  the   matters   discussed   in  this   document   contain
forward-looking  statements  that  involve  risks  and  uncertainties.   Factors
associated with the  forward-looking  statements that could cause actual results
to differ  materially  from those  projected  or  forecast  are  included in the
statements  below.  In addition to other  information  contained in this report,
readers should carefully consider the following cautionary statements.


                                       20
<PAGE>


                                  RISK FACTORS

YOU  SHOULD  CAREFULLY  CONSIDER  THE  FOLLOWING  RISK  FACTORS  AND  ALL  OTHER
INFORMATION  CONTAINED  IN THIS REPORT  BEFORE  PURCHASING  SHARES OF OUR COMMON
STOCK.  INVESTING IN OUR COMMON STOCK  INVOLVES A HIGH DEGREE OF RISK. IF ANY OF
THE  FOLLOWING  EVENTS OR OUTCOMES  ACTUALLY  OCCURS,  OUR  BUSINESS,  OPERATING
RESULTS AND FINANCIAL  CONDITION WOULD LIKELY SUFFER.  AS A RESULT,  THE TRADING
PRICE OF OUR COMMON  STOCK  COULD  DECLINE,  AND YOU MAY LOSE ALL OR PART OF THE
MONEY YOU PAID TO PURCHASE OUR COMMON STOCK.


                          RISKS RELATED TO OUR BUSINESS

OUR AUDITORS HAVE A GOING CONCERN  QUALIFICATION  IN THEIR OPINION  CONTAINED IN
OUR AUDITED  CONSOLIDATED  FINANCIAL  STATEMENTS WHICH RAISES  SUBSTANTIAL DOUBT
ABOUT OUR ABILITY TO CONTINUE AS A GOING CONCERN.

         As a result of our substantial  historical  operating  losses,  limited
revenues and working  capital and our capital needs,  our auditors added a going
concern qualification  (explanatory  paragraph) in their report contained in our
audited  consolidated  financial  statements for the seven months ended December
31, 2004 which raises substantial doubt about our ability to continue as a going
concern.  While we have relied principally in the past on external financing and
the payment of equity as direct  compensation for services to provide  liquidity
and capital resources for our operations, we can provide no assurances that cash
generated  from  operations  together  with cash  received  in the  future  from
external  financing  will be  sufficient  to  enable us to  continue  as a going
concern.

         Additionally, we can provide no assurances that service providers, such
as our lawyers and other  consultants,  previously  willing to accept our common
stock as direct compensation for their services, will continue to find that form
of  compensation  acceptable.  If these service  providers  refuse to accept our
equity as compensation,  and we are unable to generate  adequate cash to sustain
operations or to obtain enough cash from future  financing,  we will not be able
to continue as a going concern.

WE HAVE INCURRED  SUBSTANTIAL  LOSSES FROM  INCEPTION  WHILE  REALIZING  LIMITED
REVENUES AND WE MAY NEVER GENERATE  SUBSTANTIAL REVENUES OR BE PROFITABLE IN THE
FUTURE.

         For each fiscal year since our  acquisition  of SeaLife Nevada in 2002,
we  have  generated  net  losses  and  we  have   accumulated   losses  totaling
approximately $5,164,732 as of June 30, 2005. We have only recently emerged from
our  development  stage  operations  and  have  historically  generated  limited
revenues.  We can  provide  no  assurances  that our  operations  will  generate
substantial  revenues  or be  profitable  in the future.  We have just  recently
introduced  some of our products  into the  marketplace  and have shipped  small
quantities to our distributors.

WE WILL NEED TO RAISE  ADDITIONAL  CAPITAL AND IT MAY NOT BE  AVAILABLE TO US ON
FAVORABLE TERMS OR AT ALL;  INABILITY TO OBTAIN ANY NEEDED ADDITIONAL CAPITAL ON
FAVORABLE TERMS COULD ADVERSELY  AFFECT OUR BUSINESS,  RESULTS OF OPERATIONS AND
FINANCIAL CONDITION.

         We  estimate  that we may need to raise up to $5 million of  additional
capital over the next twelve months to support our operations,  meet competitive
pressures  and/or respond to unanticipated  requirements  during and beyond that
period.  While there are no definitive  arrangements  with respect to


                                       21
<PAGE>


sources of additional  financing,  management is optimistic that these funds can
be raised through public and/or private offerings of our common stock.  However,
our inability to obtain additional financing, when needed or on favorable terms,
could  materially  adversely  affect our  business,  results of  operations  and
financial condition and could cause us to curtail or cease operations.

OUR FUTURE REVENUES ARE  UNPREDICTABLE  AND OUR QUARTERLY  OPERATING RESULTS MAY
FLUCTUATE SIGNIFICANTLY.

         We have a very limited operating history,  and have very little revenue
to date. We cannot  provide any  guarantee  that any of our products or services
will ever generate  meaningful  revenue or the amount of revenue to be generated
by  any of our  products  or  services.  In  addition,  we  cannot  predict  the
consistency  of our  quarterly  operating  results.  Factors which may cause our
operating results to fluctuate significantly from quarter to quarter include:

         o        our ability to attract new and repeat customers;
         o        our ability to keep current with the evolving  requirements of
                  our target market;
         o        our ability to protect our proprietary technology;
         o        the  ability  of our  competitors  to  offer  new or  enhanced
                  products or services;
         o        our ability to sell  products  during  different  parts of the
                  calendar  year where the use of our  products by  consumers is
                  less likely; and
         o        unanticipated   delays  or  cost  increases  with  respect  to
                  research and development.

         Because  of these and other  factors,  we  believe  comparisons  of our
results of operations  for our three and six months ended June 30, 2005 and June
30, 2004, are not good  indicators of our future  performance.  If our operating
results fall below the expectations of securities analysts and investors in some
future periods, then our stock price may decline.

WE EXPECT OUR BUSINESS TO BE SEASONAL WHICH MEANS THAT WE ANTICIPATE HAVING LESS
REVENUE DURING CERTAIN PORTIONS OF THE YEAR.

         The practical application of our products,  both in the case of SeaLife
Marine paint products and ProTerra agriculture products, requires warmer weather
conditions with little to no precipitation.  As a result, management expects our
business to be seasonal,  with sales and earnings being relatively higher during
the outdoor season (such as the spring and summer  seasons) and lower during the
indoor season (such as the fall and winter  seasons).  Accordingly,  we may show
lower revenues during portions of the year which could correspondingly adversely
affect the price of our common stock.

OUR SUCCESS  DEPENDS IN PART ON OUR SUCCESSFUL  DEVELOPMENT AND SALE OF PRODUCTS
CURRENTLY IN THE RESEARCH AND DEVELOPMENT STAGE.

         Many  of  our  product   candidates  are  still  in  the  research  and
development  stage. The successful  development of new products is uncertain and
subject to a number of significant  risks.  Potential products that appear to be
promising at early states of  development  may not reach the market for a number
of reasons,  including  but not  limited  to, the cost and time of  development.
Potential products may be found to be ineffective or cause harmful side effects,
fail to receive necessary regulatory approvals, be difficult to manufacture on a
large  scale  or  be  uneconomical   or  fail  to  achieve  market   acceptance.
Additionally,  our proprietary products may not be commercially  available for a
number of years, if at all.


                                       22
<PAGE>


         There can be no assurance that any of our products in development  will
be successfully developed or that we will achieve significant revenues from such
products even if they are successfully developed.  Our success is dependent upon
our ability to develop and market our products on a timely  basis.  There can be
no  assurance  that  we will be  successful  in  developing  or  marketing  such
products,  or taking  advantage of the perceived  demand for such  products.  In
addition,  there can be no assurance that products or technologies  developed by
others will not render our products or technologies non-competitive or obsolete.

WE WILL RELY IN PART ON  INTERNATIONAL  SALES,  WHICH ARE SUBJECT TO  ADDITIONAL
RISKS.

         International  sales  may  account  for a  significant  portion  of our
revenues.  International  sales can be subject to many  inherent  risks that are
difficult or impossible for us to predict or control, including:

         o        unexpected changes in regulatory requirements and tariffs;
         o        difficulties  and costs  associated with staffing and managing
                  foreign    operations,     including    foreign    distributor
                  relationships;
         o        longer  accounts  receivable   collection  cycles  in  certain
                  foreign countries;
         o        adverse economic or political changes;
         o        unexpected changes in regulatory requirements;
         o        more  limited  protection  for  intellectual  property in some
                  countries;
         o        changes in our international  distribution  network and direct
                  sales force;
         o        potential trade restrictions, exchange controls and import and
                  export licensing requirements;
         o        potentially   adverse  tax  consequences  of  overlapping  tax
                  structure; and
         o        foreign currency fluctuations.

FAILURE TO ADEQUATELY  EXPAND TO ADDRESS  EXPANDING MARKET  OPPORTUNITIES  COULD
HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS AND RESULTS OF OPERATIONS.

         We  anticipate  that a  significant  expansion  of  operations  will be
required to address potential market  opportunities.  There can be no assurances
that we will expand our operations in a timely or  sufficiently  large manner to
capitalize on these market opportunities.  The anticipated substantial growth is
expected  to place a  significant  strain  on our  managerial,  operational  and
financial  resources and systems.  While management  believes it must implement,
improve  and  effectively  use  our   operational,   management,   research  and
development,  marketing,  financial  and  employee  training  systems  to manage
anticipated  substantial growth, there can be no assurances that these practices
will be successful.

WE MAY NOT BE ABLE TO ADEQUATELY  PROTECT OUR INTELLECTUAL  PROPERTY RIGHTS, AND
MAY BE EXPOSED TO INFRINGEMENT CLAIMS FROM THIRD PARTIES.

         The  technologies  upon which our products are based are protected only
by laws governing the  protection of trade  secrets.  Our success will depend in
part on our  ability  to  preserve  our trade  secrets  and to  operate  without
infringing on the proprietary rights of third parties. There can be no assurance
that others will not independently develop similar  technologies,  duplicate our
technologies or design around our technologies.

         The  processes  and  know-how  of  importance  to  our  technology  are
dependent upon the skills,  knowledge and experience of our technical personnel,
consultants  and advisors  and such skills,  knowledge  and  experience  are not
patentable.  To help  protect  our  rights,  we require  employees,  significant
consultants and advisors with access to  confidential  information to enter into
confidentiality


                                       23
<PAGE>


and proprietary  rights  agreements.  There can be no assurance,  however,  that
these  agreements  will  provide  adequate  protection  for our  trade  secrets,
know-how or  proprietary  information  in the event of any  unauthorized  use or
disclosure.

         We may,  from time to time,  become  involved in  litigation  regarding
intellectual  property  rights.  From time to time, we may receive  notices from
third parties of potential  infringement  and claims of potential  infringement.
Defending  these claims could be costly and time  consuming and would divert the
attention of  management  and key  personnel  from other  business  issues.  The
complexity  of the  technology  involved  and the  uncertainty  of  intellectual
property  litigation  increases  these risks.  Claims of  intellectual  property
infringement  also  might  require us to enter  into  costly  royalty or license
agreements. However, we may be unable to obtain royalty or license agreements on
terms acceptable to us, or at all.

         We do not believe  that any of our  technology  infringes on the patent
rights of third parties. However, there can be no assurance that certain aspects
of our  technology  will not be  challenged by the holders of patents or that we
will not be  required to license or  otherwise  acquire  from third  parties the
right to use additional  technology.  The failure to overcome such challenges or
obtain such licenses or rights on acceptable terms could have a material adverse
affect on us, our business, results of operations and financial condition.

IF WE BECOME INVOLVED IN LITIGATION  ARISING FROM THE FACT THAT OUR PRODUCTS ARE
FOUND TO ADVERSELY AFFECT THE ENVIRONMENT,  OR IF WE ARE REQUIRED TO PARTICIPATE
IN ANY ENVIRONMENTAL  REMEDIATION PROCESSES, THE COSTS OF SUCH ACTIVITIES MAY BE
SIGNIFICANT AND COULD MATERIALLY AND ADVERSELY HARM OUR BUSINESS.

         As a chemical  manufacturer,  certain of our products are  regulated by
the U.S.  Environmental  Protection Agency and the individual states, cities and
localities  where  marketed.  Certain  of our  products  are also  regulated  by
individual countries in the foreign markets in which we distribute, or intend to
distribute,  our  products.  While we believe  that our products do not harm the
environment,  and while our  products  currently  comply with the  environmental
regulations to which they are subject, in the event any of our products do cause
adverse affects to the  environment,  we may be involved in litigation and other
claims raised by private parties,  specialized environmental interest groups and
governmental regulatory agencies.  Additionally, we may be required to remediate
any areas that are harmed by our  products.  If we are required to pay any third
party or regulatory  agency as a result of such claims, or if we are required to
participate  in any such  remediation  processes,  the costs of such  activities
could materially and adversely affect our business.

WE FACE TECHNICAL RISKS  ASSOCIATED WITH  COMMERCIALIZING  OUR TECHNOLOGY  WHICH
COULD HAVE A MATERIAL ADVERSE IMPACT ON OUR BUSINESS RESULTS AND OPERATIONS.

         A key to our future  success is the ability to produce our  products at
lower  costs  than  our  competitors.   Although  we  are  currently   utilizing
proprietary  technology to produce such products at lower costs,  our method for
producing such products on a commercial basis has only recently begun.  Further,
although results from recent  independent tests and our early production results
have been  encouraging,  the ability of our technology to  commercially  produce
such products at  consistent  levels is still being  evaluated.  There can be no
assurance that we will continue to produce such products at lower costs than our
competitors,  nor that our technology will allow us to commercially produce such
products at consistent levels.

WE MAY BE UNABLE TO COMPETE  EFFECTIVELY WITH COMPETITORS OF PERCEIVED COMPETING
TECHNOLOGIES  OR  DIRECT   COMPETITORS  THAT  MAY  ENTER  OUR  MARKET  WITH  NEW
TECHNOLOGIES.


                                       24
<PAGE>


         The market for our products and services is relatively new. Our ability
to increase  revenues  and  generate  profitability  is directly  related to our
ability to maintain a competitive  advantage  because of our U.S.  Environmental
Protection  Agency  regulatory  registration  of our  leading  product,  SeaLife
1000(TM).  However, we face potential direct competition from companies that may
enter this market with new competing  technologies  and with greater  financial,
marketing and  distribution  resources  than us. These greater  resources  could
permit our  competitors  to  introduce  new  products  and  implement  extensive
advertising and promotional programs,  with which we may not be able to compete.
As a  result,  we can  provide  no  assurances  that we will be able to  compete
effectively in the future.

OUR PRODUCTS MAY BE SUBJECT TO TECHNOLOGICAL OBSOLESCENCE.

         Considerable  research is underway by competitors and potential  future
competitors into the causes of and solutions for marine,  agricultural and other
environmental  pollution.  Discovery of new technologies could replace or result
in lower  than  anticipated  demand for our  products,  which  would  materially
adversely  effect  our  operations  and  could  cause  us to  curtail  or  cease
operations.

OUR  INABILITY  TO ACCESS,  OR A CHANGE IN THE PRICES  OF, RAW  MATERIALS  COULD
MATERIALLY ADVERSELY IMPACT OUR RESULTS OF OPERATIONS.

         We  purchase  certain  raw  materials  such as Cuprous  Oxide and other
chemicals,  biocides,  pesticides or toxins,  under short- and long-term  supply
contracts.  The purchase  prices are  generally  determined  based on prevailing
market  conditions.  If there is a shortage  in these raw  materials,  or if our
suppliers otherwise increase the costs of such materials,  this could materially
adversely impact our results of operations.

WE HAVE LIMITED HUMAN RESOURCES.

         Our growth to date has placed, and our anticipated further expansion of
our operations  will continue to place, a significant  strain on our management,
systems  and  resources.  We will need to  continue  to develop  and improve our
financial and management  controls and our reporting systems and procedures.  We
cannot assure you that we will be able to efficiently or effectively  manage the
growth of our  operations,  and any failure to do so may limit our future growth
and  materially  and  adversely  affect our  business,  financial  condition and
results of operations.

OUR FUTURE  SUCCESS  DEPENDS,  IN PART, ON OUR KEY  PERSONNEL,  CONSULTANTS  AND
PRINCIPAL MANAGEMENT'S CONTINUED PARTICIPATION.

         Our ability to  successfully  develop our  products,  manage growth and
maintain our competitive  position will depend, in large part, on our ability to
attract  and  retain  highly  qualified  management  and  technologists.  We are
dependent  upon  our  Chief  Executive  Officer  and  Chief  Financial  Officer,
President of SeaLife  Marine,  and Gael Himmah,  an independent  contractor that
acts as our Chief Consulting Scientist,  and other members of our management and
consulting  team.  We do not  maintain  Key Man life  insurance  on any of these
employees or consultants.  Competition  for such personnel is  significant,  and
there can be no assurance that we will be able to continue to attract and retain
such personnel. Our consultants may be affiliated or employed by others and some
may have consulting or other advisory  arrangements with other entities that may
conflict or compete  with their  obligations  to us. We address  such  potential
conflicts by requiring that our consultants and independent  contractors execute
confidentiality  agreements  upon  commencement  of  relationships  with us,  by
closely  monitoring the work of such persons and by requiring  material transfer
and assignment agreements wherever possible and appropriate.


                                       25
<PAGE>


         Gael Himmah, the individual  responsible for the development of most of
the  technology  that forms the basis of our  products is  currently  party to a
consulting agreement with us. If Mr. Himmah terminates his relationship with us,
or  otherwise  is  unable to  provide  services  to us,  it may have a  material
negative  affect on our ability to continue  development  of our current and new
product  lines.  We do not carry any Key Man life insurance on Mr. Himmah and do
not have any plans to do so in the near future.

WE ARE HIGHLY DEPENDENT ON OUTSIDE CONSULTANTS.

         If our consultants or collaborative partners, including, in particular,
our Chief Consulting Scientist, Gael Himmah, do not perform, we may be unable to
develop and bring to market new products as  anticipated,  or to further develop
and commercialize existing products.

         We may in the future  enter  into  consulting  arrangements  with third
parties to develop  products.  These  arrangements  may not  produce  successful
products.  If we fail to establish  these  arrangements,  the number of products
from which we could receive future revenues will be limited.

         Our dependence on consulting  arrangements  with third parties subjects
us to a number of risks. These arrangements may not be on terms favorable to us.
We cannot absolutely  control the amount and timing of resources our consultants
may  devote  to our  products,  and these  third  parties  may  choose to pursue
alternative products. These third parties also may not perform their obligations
as  expected.  Business  combinations,  significant  changes  in their  business
strategy,  or  their  access  to  financial  resources  may  adversely  affect a
consultant's  or partner's  willingness  or ability to complete its  obligations
under the arrangement.  Moreover,  we could become involved in disputes with our
consultants  or  partners,  which  could  lead to delays or  termination  of the
arrangements and time-consuming and expensive litigation or arbitration.

WE DO NOT HAVE A SEPARATE  STANDING AUDIT COMMITTEE,  COMPENSATION  COMMITTEE OR
NOMINATING  AND  CORPORATE  GOVERNANCE  COMMITTEE,  SO  THE  DUTIES  CUSTOMARILY
DELEGATED  TO THOSE  COMMITTEES  ARE  PERFORMED  BY THE BOARD OF  DIRECTORS AS A
WHOLE,  AND NO DIRECTOR IS AN "AUDIT COMMITTEE  FINANCIAL  EXPERT" AS DEFINED BY
THE RULES AND REGULATIONS OF THE SECURITIES AND EXCHANGE COMMISSION.

         Our Board of  Directors  consists of two members,  our Chief  Executive
Officer and Chief Financial Officer,  and our Vice President and Secretary.  The
Board of Directors  as a whole  performs  the  functions of an Audit  Committee,
Compensation  Committee  and  Nominating  and  Corporate  Governance  Committee.
Neither of the directors is considered  "independent"  under Rule 4200(a)(15) of
the National  Association of Securities Dealers listing  standards,  and neither
qualifies  as an audit  committee  financial  expert as  defined  in Item 401 of
Regulation S-B. Accordingly, we will not be able to list our common stock with a
nationally  recognized  exchange until we recruit  independent  directors to the
Board and restructure our Board to comply with various requirements currently in
place  by  those  self-regulating  organizations,  and  as a  result,  it may be
difficult for you to sell our common stock.

THE  REQUIREMENTS  OF  THE  SARBANES-OXLEY   ACT,  INCLUDING  SECTION  404,  ARE
BURDENSOME,  AND OUR FAILURE TO COMPLY  WITH THEM COULD HAVE A MATERIAL  ADVERSE
AFFECT ON OUR BUSINESS AND STOCK PRICE.

         Except  with  respect  to the  adoption  of our Code of Ethics  and our
compliance  with  certain  requirements  specifically  applicable  to our Annual
Report on Form 10-KSB and our other  periodic  reports,  our  management has not
commenced  any  specific  procedures  to  comply  with the  requirements  of the
Sarbanes Oxley Act of 2002,  including  specifically,  the process  necessary to
implement the  requirements  of Section 404 of the  Sarbanes-Oxley  Act of 2002,
which requires our management to


                                       26
<PAGE>


assess the effectiveness of our internal  controls over financial  reporting and
include  an  assertion  in our  annual  report  as to the  effectiveness  of our
controls.  Beginning  with our Annual  Report on Form  10-KSB for the year ended
December 31,  2006,  unless  otherwise  amended by the  Securities  and Exchange
Commission,  our  independent  registered  accounting  firm will be  required to
attest to whether our assessment of the  effectiveness  of our internal  control
over  financial  reporting  is  fairly  stated  in  all  material  respects  and
separately  report  on  whether  it  believes  we  maintained,  in all  material
respects,  effective  internal controls over financial  reporting as of December
31,  2006.  Because  of our  management's  lack of  resources,  and our  limited
operations,  we have not  commenced  the  process  of  preparing  the system and
process  documentation,  performing  an  evaluation  of  our  internal  controls
required  for our  management  to make this  assessment  and for the auditors to
provide their attestation report, and accordingly, have not begun testing of the
effectiveness  of these  internal  controls.  We expect that this  process  will
require significant amounts of management time and resources,  as well as higher
expenses  in the form of higher  audit and review  fees,  higher  legal fees and
higher  internal  costs to document,  test and  potentially  remediate  internal
controls. Accordingly, with respect to Section 404 in particular, there exists a
significant  risk  that we will  not be able  to meet  all the  requirements  of
Section  404 by the end of fiscal year 2006,  when we are  required to report on
our internal controls and provide our auditor's  opinion thereon.  Additionally,
even in the event we  attempt  to comply  with  Section  404,  in the  course of
evaluation and testing,  management may identify  deficiencies that will need to
be addressed and remediated,  which could  potentially  have a material  adverse
effect  on  our  stock  price  and  could  result  in   significant   additional
expenditures.

                          RISKS RELATED TO OUR INDUSTRY

OUR  INDUSTRY IS VERY  COMPETITIVE,  AND WE MAY BE UNABLE TO CONTINUE TO COMPETE
EFFECTIVELY IN THIS INDUSTRY IN THE FUTURE.

         We are engaged in an industry  that is highly  competitive.  We compete
with many other  suppliers  and new  competitors  continue to enter the markets.
Many of our  competitors,  both in the United  States and  elsewhere,  are major
chemical  companies,  and  many  of  them  have  substantially  greater  capital
resources, marketing experience, research and development staffs, and facilities
than we do. Any of these companies could succeed in developing products that are
more  effective  than the  products  that we have or may develop and may also be
more successful  than us in producing and marketing  their  products.  We expect
this  competition  to continue and intensify in the future.  Competition  in our
markets is primarily driven by:

         o        product performance, features and liability;
         o        price;
         o        timing of product introductions;
         o        ability to develop,  maintain and protect proprietary products
                  and technologies;
         o        sales and distribution capabilities;
         o        technical support and service;
         o        brand loyalty;
         o        applications support; and
         o        breadth of product line.

         If  a  competitor   develops  superior   technology  or  cost-effective
alternatives to our products,  our business,  financial condition and results of
operations could be materially adversely affected.


                                       27
<PAGE>


WE ARE  SUBJECT  TO A WIDE  VARIETY  OF  LOCAL,  STATE  AND  FEDERAL  RULES  AND
REGULATIONS,  WHICH COULD RESULT IN UNINTENTIONAL VIOLATIONS OF SUCH LAWS. ALSO,
CHANGES IN SUCH LAWS COULD RESULT IN LOSS OF REVENUES.

         As a chemical manufacturer,  we are subject to a wide variety of local,
state and federal rules and  regulations.  While we believe that our  operations
are in compliance with all applicable rules and  regulations,  we can provide no
assurances  that from time to time  unintentional  violations  of such rules and
regulations  will not occur.  Certain of our products are regulated by the U. S.
Environmental  Protection  Agency  and the  individual  states  where  marketed.
Government  regulation  results in added  costs for  compliance  activities  and
increases the risk of losing revenues should regulations change. Also, from time
to time we must expend  resources to comply with newly adopted  regulations,  as
well as  changes  in  existing  regulations.  If we fail to  comply  with  these
regulations,  we could be subject  to  disciplinary  actions  or  administrative
enforcement actions. These actions could result in penalties, including fines.

                        RISKS RELATED TO OUR COMMON STOCK

WE HAVE A LIMITED  TRADING  VOLUME AND SHARES  ELIGIBLE  FOR FUTURE  SALE BY OUR
CURRENT STOCKHOLDERS MAY ADVERSELY AFFECT OUR STOCK PRICE.

         To date, we have had a very limited trading volume in our common stock.
As long as this condition continues,  the sale of a significant number of shares
of common  stock at any  particular  time could be  difficult  to achieve at the
market  prices  prevailing  immediately  before  such  shares  are  offered.  In
addition,  sales of substantial amounts of common stock, including shares issued
upon the  exercise  of  outstanding  options  and  warrants,  under  Rule 144 or
otherwise could adversely affect the prevailing market price of our common stock
and could  impair our ability to raise  capital at that time through the sale of
our  securities.  As a result of our limited cash, a number of our employees and
consultants have elected to accept a portion of their  compensation in shares of
our common  stock and a portion of these  shares  have been  issued  pursuant to
effective registration statements or registered for resale to the public.

OUR COMMON STOCK PRICE IS HIGHLY VOLATILE.

         The market price of our common stock is likely to be highly volatile as
the stock  market  in  general,  and the  market  for  technology  companies  in
particular, has been highly volatile.

         Factors  that could  cause  such  volatility  in our  common  stock may
include, among other things:

         o        actual or anticipated  fluctuations in our quarterly operating
                  results;
         o        announcements of technological innovations;
         o        changes in financial estimates by securities analysts;
         o        conditions or trends in our industry; and
         o        changes  in  the  market   valuations   of  other   comparable
                  companies.

THE SALE OF OUR  COMMON  STOCK ON THE  OVER-THE-COUNTER  BULLETIN  BOARD AND THE
POTENTIAL  DESIGNATION  OF OUR COMMON STOCK AS A "PENNY  STOCK" COULD IMPACT THE
TRADING MARKET FOR OUR COMMON STOCK.

         Our securities,  as traded on the Over-the-Counter Bulletin Board, will
be subject to Securities and Exchange Commission rules that impose special sales
practice  requirements upon  broker-dealers  who sell such securities to persons
other than established customers or accredited investors. For


                                       28
<PAGE>


purposes of the rule, the phrase "accredited investors" means, in general terms,
institutions  with assets in excess of $5,000,000,  or individuals  having a net
worth in excess of $1,000,000  or having an annual income that exceeds  $200,000
(or  that,  when  combined  with  a  spouse's  income,  exceeds  $300,000).  For
transactions  covered  by the  rule,  the  broker-dealer  must  make  a  special
suitability  determination for the purchaser and receive the purchaser's written
agreement  to the  transaction  prior to the  sale.  Consequently,  the rule may
affect the ability of  broker-dealers to sell our securities and also may affect
the  ability of  purchasers  to sell their  securities  in any market that might
develop therefor.

         In  addition,  the  Securities  and Exchange  Commission  has adopted a
number of rules to regulate  "penny  stock." Such rules  include  Rules  3a51-1,
15g-1,  15g-2, 15g-3, 15g-4, 15g-5, 15g-6, 15g-7, and 15g-9 under the Securities
and Exchange Act of 1934,  as amended.  Because our  securities  may  constitute
"penny stock"  within the meaning of the rules,  the rules would apply to us and
to our  securities.  The rules may  further  affect the ability of owners of our
common stock to sell our securities in any market that might develop for them.

         Shareholders should be aware that, according to Securities and Exchange
Commission,  the  market  for penny  stocks has  suffered  in recent  years from
patterns of fraud and abuse. Such patterns include (i) control of the market for
the  security  by one or a few  broker-dealers  that are  often  related  to the
promoter or issuer; (ii) manipulation of prices through prearranged  matching of
purchases and sales and false and misleading press releases; (iii) "boiler room"
practices   involving   high-pressure   sales  tactics  and  unrealistic   price
projections  by  inexperienced  sales persons;  (iv)  excessive and  undisclosed
bid-ask  differentials  and  markups  by  selling  broker-dealers;  and  (v) the
wholesale dumping of the same securities by promoters and  broker-dealers  after
prices have been  manipulated to a desired level,  resulting in investor losses.
Our  management  is aware of the abuses that have occurred  historically  in the
penny stock market. Although we do not expect to be in a position to dictate the
behavior  of the market or of  broker-dealers  who  participate  in the  market,
management  will strive within the confines of practical  limitations to prevent
the described patterns from being established with respect to our securities.

WE DO NOT FORESEE PAYING DIVIDENDS IN THE NEAR FUTURE.

         We have not paid  dividends on our common  stock and do not  anticipate
paying such dividends in the foreseeable future.

ANY  ISSUANCE  OF  FURTHER  STOCK MAY  RESULT IN THE LOSS OF  CONTROL BY PRESENT
MANAGEMENT AND SHAREHOLDERS.

         We may issue shares in consideration  for cash,  assets or services out
of our authorized but unissued common stock that could, upon issuance, represent
a majority of our voting power and equity.  The result of such an issuance would
be that those new  shareholders  and  management  would  control us, and unknown
persons could  replace our  management  at that time.  Such an occurrence  would
result  in a  greatly  reduced  percentage  of  ownership  of us by our  current
shareholders.

OFFICERS AND  DIRECTORS OWN A  SIGNIFICANT  PORTION OF OUR COMMON  STOCK,  WHICH
COULD  LIMIT  OUR  SHAREHOLDERS'   ABILITY  TO  INFLUENCE  THE  OUTCOME  OF  KEY
TRANSACTIONS.

         As of June 30, 2005,  our officers and directors  and their  affiliates
owned  approximately  27% of our  outstanding  voting shares.  As a result,  our
officers and directors are able to exert considerable influence over the outcome
of any matters submitted to a vote of the holders of our common stock, including
the election of our Board of Directors.  The voting power of these  shareholders
could also  discourage  others from seeking to acquire control of us through the
purchase of our common stock, which might depress the price of our common stock.


                                       29
<PAGE>


ITEM 3.  CONTROLS AND PROCEDURES.

CONTROLS AND PROCEDURES

         Members of the  company's  management,  including  our Chief  Executive
Officer,  President and Chief Financial Officer, Robert McCaslin, have evaluated
the  effectiveness  of our  disclosure  controls and  procedures,  as defined by
paragraph (e) of Exchange Act Rules 13a-15 or 15d-15,  as of June 30, 2005,  the
end of the  period  covered by this  report.  Based  upon that  evaluation,  Mr.
McCaslin concluded that our disclosure controls and procedures are effective.

INTERNAL CONTROL OVER FINANCIAL REPORTING

         There were no changes in our internal control over financial  reporting
or in other factors  identified in connection  with the  evaluation  required by
paragraph  (d) of Exchange Act Rules 13a-15 or 15d-15 that  occurred  during the
second  quarter  ended  June 30,  2005 that  have  materially  affected,  or are
reasonably  likely to materially  affect,  our internal  control over  financial
reporting.


                                       30
<PAGE>


                                     PART II

                                OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

         On April 5, 2005, the United States Securities and Exchange  Commission
(the "SEC") filed a civil  complaint in the United States District Court for the
District of Colorado  against us, Robert McCaslin (our Chief  Executive  Officer
and Chief Financial Officer), and several third parties not currently affiliated
with the Company,  alleging  violations  of the  Securities  Act of 1933 and the
Securities  Exchange Act of 1934 in connection with events that occurred in 2002
and 2003.

         The complaint  alleges that we, Mr. McCaslin and six other  individuals
and  entities  engaged in a "scheme" to defraud the  investing  public by "using
materially false and misleading public statements and manipulative stock trading
to create an  artificial  market  for,  and to sell,  our common  stock  without
registration or a valid exemption under the federal securities laws."

         Specifically,  the complaint alleges that, Mr. McCaslin retained Roland
Thomas  ("Thomas") to raise  capital for us and promote us to investors,  and to
raise $400,000 to pay our principal shareholders and complete the acquisition of
SeaLife Nevada, and that Thomas devised a plan with Douglas A. Glaser ("Glaser")
to meet those goals. To carry out the plan, the complaint alleges, we issued one
million shares to Thomas,  Glaser, and an employee of ERT Technology Corporation
(a Delaware corporation owned by Thomas,  Douglas A. Glaser and Barry S. Griffin
("Griffin"),  Jeffrey A. Hayden ("Hayden"), and Morgan J. Wilbur III ("Wilbur"),
and registered the stock with the SEC on Form S-8, which  registers stock issued
to a company's  employees and consultants.  However,  the complaint alleges that
Form S-8 was  improperly  used because  Thomas and Glaser were retained to raise
capital for us and to promote and maintain the market for our common stock.

         The  complaint  further  alleges  that  Thomas and  Glaser  transferred
portions of their stock to Griffin,  Hayden, and Wilbur for ultimate sale to the
public through brokerage  transactions.  Between January and March 2003, Thomas,
ERT, Glaser, Griffin, Hayden, and Wilbur sold close to one million shares of our
common stock.  During this time, we were engaged in a publicity  campaign  using
press  releases,  a corporate  fact sheet,  and a business  plan. The latter two
documents were  disseminated to brokers and investors and also placed on our web
site for public  review.  The  complaint  alleges  that the  publicity  included
materially false and misleading information,  which included claims (a) that our
products  were ready to be marketed,  when in fact we needed  capital to conduct
further  testing;  (b) that our  intellectual  property  was worth more than $60
million,  when in fact we carried  the  property  on its books at less than $1.5
million;  and (c) that projected over $5 million sales during our first year and
significant  profits based on a 70% gross  margin,  when in fact we had no basis
for  figuring  our  sales  margin  and could  not meet its  projections  without
additional product testing and capital. In addition,  the complaint alleges that
our  publicity  campaign did not disclose  the  $400,000  owed to the  principal
shareholders  of the shell or the fact that we had retained Thomas and Glaser to
sell our common stock to pay that debt and raise capital.  Filings made with the
Commission on Form 8-K allegedly  compounded the false and misleading  impact of
the publicity campaign.

         The  complaint  further  alleges that  Thomas,  ERT,  Glaser,  Griffin,
Hayden, and Wilbur used manipulative  techniques to distribute our common stock.
According to the complaint,  they engaged in wash sales or matched  trades,  and
purchased  small  amounts  of the stock  that they were  distributing  to create
artificial  trading volume and maintain the price for the distribution.  Through
these techniques, they were able to generate income for themselves, but they did
not send any of that money back to us or to the prior principal  shareholders of
the shell. The complaint also alleges that we made false and


                                       31
<PAGE>


misleading statements in an August 2003 press release about a renegotiation with
the prior principal  shareholders of the shell, which helped conceal the earlier
fraudulent activities described above.

         All defendants  are charged with violating the securities  registration
and antifraud  provisions of the federal securities laws,  Sections 5(a) and (c)
and 17(a) of the Securities Act of 1933 ("Securities Act"), Section 10(b) of the
Securities  Exchange Act of 1934 ("Exchange  Act"),  and Rule 10b-5  thereunder.
Thomas, ERT, Glaser, Griffin, Hayden, and Wilbur are also charged with violating
Rule 101 of Regulation M, an anti-manipulation  rule that prohibits participants
in a stock  distribution from purchasing stock that they are  distributing.  The
complaint  also  charges that Mr.  McCaslin,  Thomas,  ERT, and Glaser  violated
ownership  reporting  provisions in Sections  13(d)(1) and 16(a) of the Exchange
Act and Rules 13d-1 and 16a-3, and that Thomas, ERT, and Glaser violated Section
13(d)(2) and Rule 13d-2.  Finally,  the complaint  charges that SeaLife violated
the filings  provisions,  Section  13(a) of the Exchange  Act and Rules  13a-11,
13a-13, and 12b-20, and that Mr. McCaslin aided and abetted those violations.

         The Commission seeks permanent  injunctions against all defendants,  an
order  requiring  Thomas,  ERT,  Glaser,  Griffin,  and  Wilbur  to  provide  an
accounting  and  disgorgement,   civil  penalties  against  all  defendants,  an
officer-and-director  bar against  Mr.  McCaslin,  and penny stock bars  against
Thomas, ERT, Glaser, Griffin, Hayden, and Wilbur.

         Based on an initial review of the complaint,  we and Mr.  McCaslin deny
the  allegations  made by the SEC,  and intend to  continue to  investigate  the
allegations  and  vigorously  defend  the  suit.  We have been  served  with the
complaint, and no further proceedings are scheduled at this time.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

         During  the  three  months  ended  June 30,  2005,  we did not have any
unregistered sales of equity securities.

ITEM 6.  EXHIBITS

         THE FOLLOWING EXHIBITS ARE FILED AS PART OF THIS REPORT:

         EXHIBIT
         NUMBER                            DESCRIPTION
         -------                           -----------

         3.1      Restated  Certificate of Incorporation of SeaLife  Corporation
                  (1)

         3.2      Bylaws of SeaLife Corporation (1)

         31.1     Certification  of Principal  Executive  Officer and  Principal
                  Financial Officer pursuant to pursuant Securities Exchange Act
                  Rules  13a-14(a) and 15d-14(a) as adopted  pursuant to Section
                  302 of the Sarbanes-Oxley Act of 2002.

         32.1     Certification  of Principal  Executive  Officer and  Principal
                  Financial  Officer  pursuant  to 18 U.S.C.  Section  1350,  as
                  adopted pursuant to Section 906 of the  Sarbanes-Oxley  Act of
                  2002.

(1)      Filed as an Exhibit to our Annual  Report on Form 10-KSB for the period
         ended May 31, 2003, dated September 19, 2004.


                                       32
<PAGE>


                                   SIGNATURES

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

                                          SEALIFE CORPORATION


Date: August 18, 2005                      /s/ Robert A. McCaslin
                                           -------------------------------------
                                      By:  Robert A. McCaslin
                                      Its: Chief Financial Officer
                                           (Principal Financial and
                                           Accounting Officer)


                                       33
<PAGE>


                                  EXHIBIT INDEX

         EXHIBIT
         NUMBER                            DESCRIPTION
         -------                           -----------

         3.1      Restated  Certificate of Incorporation of SeaLife  Corporation
                  (1)

         3.2      Bylaws of SeaLife Corporation (1)

         31.1     Certification  of Principal  Executive  Officer and  Principal
                  Financial Officer pursuant to pursuant Securities Exchange Act
                  Rules  13a-14(a) and 15d-14(a) as adopted  pursuant to Section
                  302 of the Sarbanes-Oxley Act of 2002.

         32.1     Certification  of Principal  Executive  Officer and  Principal
                  Financial  Officer  pursuant  to 18 U.S.C.  Section  1350,  as
                  adopted pursuant to Section 906 of the  Sarbanes-Oxley  Act of
                  2002.

(1)      Filed as an Exhibit to our Annual  Report on Form 10-KSB for the period
         ended May 31, 2003, dated September 19, 2004.


                                       34