UNITED
STATES
 SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
 
 ________________________
 
 FORM
10-K
 ______________
 
 (Mark
One)
 o
              ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934
  
  x
              TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934
  For
the transition period from May 1, 2008 to December 31, 2008
 
 Commission
File Number 000-29461









SEAFARER
EXPLORATION CORP.
 
 (Exact
name of registrant as specified in its charter)
 
  Delaware
              73-1556428(State
      or other jurisdiction ofincorporation
      or organization)
              (I.R.S.
      Employer Identification No.)
 
 14497
N. Dale Mabry Highway, Suite 209N, Tampa, 33618
 
 (Address
of principal executive offices)(Zip code)
 
 
 (Formerly
Organetix, Inc., c/o Sichenzia Ross Friedman Ference LLP,)
 
 (61
Broadway, Fl. 32, New York, NY 10006)
 
 Registrant’s
telephone number: (813) 448-3577
 
 Securities
registered pursuant to Section 12(g) of the Act:
  Common
Stock, par value $0.001 per share
    1
  Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.  Yes  o     No x
  Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act.  Yes o     No x
  Indicate
by check mark whether the registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.  Yes x      No o
  Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the
best of registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.  o
 
 Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check
one):
 
 Large
      accelerated filer
              
              Accelerated
      filer
              
              Non-accelerated
      filer  
              
              Smaller
      reporting companyx(Do
      not check if a smaller reporting company)
  Indicate
by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Act).  Yes o     No x
  The
aggregate market value of the common stock, par value $0.001 per share, held by
non-affiliates of the Registrant, computed by reference to the closing price of
such stock on May 5, 2009 was $5,186,769.72
 .
 As of May
5, 2009, there were 282,946,225 shares of the Registrant’s Common Stock issued
and outstanding.
 
 
                
 2
 
 SEAFARER
EXPLORATION CORP.
 ANNUAL
REPORT ON FORM 10-K
 TABLE OF CONTENTS
 
 PagePART IITEM 1.
                      BUSINESS
                      5ITEM 1A.
                      RISK
    FACTORS
                      6ITEM
      1B.
                      UNRESOLVED
      STAFF COMMENTS
                      7ITEM 2.
                      PROPERTIES
                      7ITEM 3.
                      LEGAL
      PROCEEDINGS
                      7ITEM 4.
                      SUBMISSION OF MATTERS TO A VOTE
      OF SECURITY HOLDERS
                      7PART IIITEM 5.
                      MARKET FOR REGISTRANT’S COMMON
      EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
      SECURITIES
                      8ITEM
      6.
                      SELECTED
      FINANCIAL DATA
                      9ITEM 7.
                      MANAGEMENT’S DISCUSSION AND
      ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS
                      9ITEM
      7A.
                      QUANITIATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
                      13ITEM 8.
                      FINANCIAL STATEMENTS AND
      SUPPLEMENTARY DATA
                      14ITEM 9.
                      CHANGES IN AND DISAGREEMENTS WITH
      ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
                      29ITEM 9A.
                      CONTROLS AND
      PROCEDURES
                      29ITEM 9B.
                      OTHER
      INFORMATION
                      31PART
IIIITEM 10.
                      DIRECTORS, EXECUTIVE OFFICERS AND
      CORPORATE GOVERNANCE
                      32ITEM 11.
                      EXECUTIVE
      COMPENSATION
                      33ITEM 12.
                      SECURITY OWNERSHIP OF CERTAIN
      BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERS
      MATTERS
                      34ITEM 13.
                      CERTAIN RELATIONSHIPS AND RELATED
      TRANSACTIONS
                      35ITEM 14.
                      PRINCIPAL ACCOUNTING FEES AND
      SERVICES
                      35PART IVITEM 15.
                      EXHIBITS, FINANCIAL STATEMENTS
      SCHEDULES
                      36SIGNATURES
                      37













3











SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS AND ASSOCIATED RISKS





Statements
in this Form 10-K under "Item 1. Business", "Item 2. Properties", "Item 3. Legal
Proceedings", and "Item 7. Management's Discussions and Analysis of Financial
Condition and Results of Operations" and elsewhere constitute "forward-looking
statements" Such forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results, performance
or achievements of Seafarer Exploration Corp., a company organized under the
laws of Delaware, to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. Such factors include, among others, the following: our ability to
continue as a going concern, general economic and business conditions;
competition; success of operating initiatives; our ability to raise capital and
the terms thereof; changes in business strategy or development plans; future
revenues; the continuity, experience and quality of our management; changes in
or failure to comply with government regulations or the lack of government
authorization to continue our projects; and other factors referenced in the Form
10-K.





The
use in this Form 10-K of such words as "believes", "plans", "anticipates",
"expects", "intends", and similar expressions are intended to identify
forward-looking statements, but are not the exclusive means of identifying such
statements. The success of the Company is dependent on our efforts and many
other factors including, primarily, our ability to raise additional
capital.





We
caution readers not to place undue reliance on any such forward-looking
statements, which speak only as of the date made.  Such
forward-looking statements are based on the beliefs and estimates of our
management as well as on assumptions made by and information currently available
to us at the time such statements were made. Forward looking statements are
subject to a variety of risks and uncertainties which could cause actual events
or results to differ from those reflected in the forward looking statements,
including, without limitation, the failure to successfully locate cargo and
artifacts from the Juno Beach shipwreck site and a number of other risks and
uncertainties. Actual results could differ materially from those projected in
the forward-looking statements, either as a result of the matters set forth or
incorporated in this Report generally and certain economic and business factors,
some of which may be beyond our control.





We
disclaim any obligation subsequently to revise any forward-looking statements to
reflect events or circumstances after the date of such statements or to reflect
the occurrence of anticipated or unanticipated events.





As used
in this Form 10-K, the terms “we,” “us,” “our,” “Seafarer,” and the “Company”
mean Seafarer Exploration Corp. and any of its subsidiaries, unless otherwise
indicated.





4





PART
I




Item
1. Business.




Summary




Seafarer
Exploration Corp. ("the Company" or "Seafarer"), a Delaware Corporation, was
incorporated on May 28, 2003. The Company formerly operated under the name
Organetix, Inc. (“Organetix”). The Company's principal business plan is to
engage in the archaeologically-sensitive exploration and recovery of a shipwreck
located off of Juno Beach, Florida. The exploration and recovery of historic
shipwrecks is extremely speculative and there is a very high degree of risk
inherent in this type of business venture.





Although
the Company believes that it is possible that the Juno Beach shipwreck may
potentially be a sunken Spanish galleon, the Company does not have any
definitive proof as to the country of origin of the shipwreck and it is very
possible that the cargo the ship was originally carrying, if any, had little or
no value and thus would be worthless. It is also entirely possible that the
Company will never successfully locate and recover any cargo or artifacts that
have any significant value from the shipwreck site. The Company has not yet
generated revenues, and is therefore considered a development stage
company.





Change
of Control





On June
4, 2008, Organetix entered into a Share Exchange Agreement with Seafarer
Exploration, Inc. (“Seafarer, Inc.), a private company formed under the laws of
Florida, and the shareholders of Seafarer Inc. pursuant to which Organetix
agreed to acquire all of the outstanding shares of common stock of Seafarer Inc.
from its Shareholders. As consideration for the acquisition of the 18,905,083
shares of Seafarer Inc., Organetix agreed to issue an aggregate of 131,243,235
shares of Common stock, $0.0001 par value to the Seafarer, Inc. Shareholders.
Following this transaction, the stockholders of Seafarer, Inc. controlled the
majority of the Organetix common stock and Seafarer Inc.’s management assumed
operational, management and governance control of Organetix. As a result, this
reverse merger transaction was treated retroactively as a recapitalization with
Seafarer, Inc. being treated as the acquirer for accounting
purposes.





On July
17, 2008, the Company filed a Certificate of Ownership to merge Seafarer
Exploration Corp., a wholly-owned subsidiary of the Company into the Company
with the Secretary of State of the State of Delaware.  Pursuant to the
Certificate of Ownership, the Company’s Articles of Incorporation were amended
to change its name from Organetix, Inc. to Seafarer Exploration
Corp.





Development
Stage Company





Previously,
the Company devoted its time towards establishing its business and no revenues
have been generated to date. As such, the Company is considered as being in the
development stage, since its inception, in accordance with Statement of
Financial Accounting Standards No. 7, and its year-end is December
31.





The
Company expects to continue to incur significant operating losses and to
generate negative cash flow from operating activities while exploring and
attempting to recover artifacts from the Juno Beach shipwreck and
establishing itself in the marketplace.





The
Company’s ability to eliminate operating losses and to generate positive cash
flow from operations in the future will depend upon a variety of factors, many
of which it is unable to control. The Company expects to expend its
available cash in less than one month from May 5, 2009 based on our historical
rate of expenditures. If the Company is unable to implement its business
plan successfully, it may not be able to eliminate operating losses, generate
positive cash flow, or achieve or sustain profitability, which would materially
adversely affect its business, operations, and financial results, as well as its
ability to make payments on its debt obligations and the Company may be forced
to cease its operations.





5





Item 1. Business - continued




General





The
Company’s primary objective is to locate and recover artifacts and cargo from a
shipwreck located off of the coast of Juno Beach, Florida (the “Shipwreck”). The
Company does not currently have sufficient data to positively identify the
Shipwreck or its country of origin and therefore it is not possible to discern
whether or not the ship was originally carrying cargo of any significant value.
There is a very strong possibility that the Company may never recover any
artifacts or cargo of any significant value from the Shipwreck.





Operations





The
diving season for the shipwreck exploration and recovery business in Florida is
generally considered to be the summer months, from approximately the middle of
May through Labor Day. Inclement weather and hazardous ocean conditions
generally hamper year round historical shipwreck salvage and recovery efforts in
Florida waters. The Company does believe that it may be possible to perform
limited recovery efforts on the Shipwreck during the non summer months, possibly
one or two days per month, assuming that there are favorable weather and ocean
conditions and also assuming that the Company is able to secure the necessary
financing to conduct year round operations.





The
Company spent limited time exploring the Shipwreck during the summer of 2008
diving season.


From
approximately the end of August 2008 until the end of December 2008 the Company
did not conduct any recovery efforts on the Shipwreck site. No exploration and
recovery operations were conducted during this time frame mainly due to the fact
that the Company was in the process of renewing the agreement regarding the
recovery of historic shipwrecks artifacts with the State of Florida, Department
of State, Division of Historical Resources (“DHR”).





After the
agreement with the DHR was finalized in November 2008 the Company then had to
wait for environmental permits to be issued. The Company did not conduct
recovery efforts on the Shipwreck prior to the finalization of the agreement
with the DHR or while waiting to receive the environmental permits. Lack of
funding and inclement weather conditions were also factors that impacted the
Company’s ability to conduct recovery operations during 2008.





Since
January 1, 2009 the Company has spent very minimal time, only one or two days,
exploring the Shipwreck. Pending the receipt of financing and assuming that
weather and ocean conditions are favorable, the Company will potentially be able
to commence limited exploration and recovery efforts prior to the start of the
summer 2009 diving season. Furthermore, the Company must secure private
financing order to be able to commence full time exploration and recovery
efforts during the summer 2009 diving season.





Governmental
Regulation





The laws
and regulations regarding the exploration and recovery of historic shipwrecks in
waters controlled by the State of Florida are complex. A large amount of time
and expense is required in terms of Company resources in order to attempt to
fully comply with the existing laws and regulations. Furthermore the DHR has
recently proposed new rules and regulations regarding the exploration and
recovery of shipwrecks in Florida waters.


The
Company believes that if these new rules and regulations are implemented into
law then the burden of compliance may increase significantly. The State of
Florida may potentially enact additional laws that ultimately make it impossible
to conduct a profitable business as a commercial shipwreck exploration and
recovery firm. It is also entirely possible that the State of Florida may
eventually attempt to ban altogether the commercial exploration and recovery of
historic shipwrecks in State controlled waters.





Item
1A. Risk Factors.





Not
required for smaller reporting companies.





6





Item
1B. Unresolved Staff Comments.





Not
required for smaller reporting companies.





Item
2. Properties.




The
Company leases 823 square feet of office space located at 14497 North Dale Mabry
Highway, Suite 209-N, Tampa, FL 33618. The base rental rate including taxes is
$1,284.21 per month plus additional monthly charges for any services used by the
Company. The term of the lease agreement commenced on October 1, 2008 and
expires on March 31, 2010.





The
Company rents a boat slip for its vessel, the Iron Maiden, at Blowing Rocks
Marina, LLC located at 18487 SE Federal Highway, Tequesta, Florida 33469. The
agreement with Blowing Rocks Marina, LLC is on a month-to-month basis and the
base monthly rental rate for the boat slip is $1,091.84 which includes utilities
and taxes. The marina may charge additional fees if it provides other services
to the Company.





Item
3. Legal Proceedings.




The
Company is not the subject of any pending legal proceedings; and to the
knowledge of management, no proceedings are presently contemplated against the
Company by any federal, state or local governmental agency.





Item
4. Submission of Matters to a Vote of Security Holders.




We have
not submitted a matter to a vote of our stockholders during the fourth quarter
of our fiscal year ended December 31, 2008






































7





PART II




Item 5. Market for Registrant’s Common
Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities.





Market
Information




Our
common stock is presently quoted on the OTC Bulletin Board under the symbol
“SFRX” as reflected below, though the current trading volume is small. No
assurance can be given that any market for our common stock will continue in the
future or be maintained. If an “established trading market” ever develops in the
future, the sale of “restricted securities” (common stock) pursuant to Rule 144
of the Securities and Exchange Commission by members of management or others may
have a substantial adverse impact on any such market.





The range
of high and low bid quotations for our common stock during each quarter for
2007, 2008 and the first quarter of 2009 is shown below. The over-the-counter
quotations reflect inter-dealer prices, with retail mark-up, mark-down or
commission and may not necessarily represent actual transactions. Such prices
were determined from information derived from www.bigcharts.com and
do not necessarily reflect transactions, retail markups, mark downs or
commissions.





Quarter
      Ended
                  High
      Price
                  Low
      PriceMarch
      31, 2007
                  0.12
                  0.06June
      30, 2007
                  0.13
                  0.03September,
      2007
                  0.20
                  0.05December,
      2007
                  0.128
                  0.045March
      31, 2008
                  0.114
                  0.05June
      30, 2008
                  0.157
                  0.075September
      30, 2008
                  0.125
                  0.015December
      31, 2008
                  0.04
                  0.011March
      31, 2009
                  0.045
                  0.015





Holders





As of May
5, 2009 there were 1,675 shareholders holding certificated securities and
approximately 54,449,241 shares being held in “street name” in brokerage
accounts by an indeterminate number of shareholders.





Transfer
Agent




Our
transfer agent is Island Stock Transfer.




Dividend
Policy





No cash
dividends were declared by the Company during the fiscal year ended December 31,
2008. It is not anticipated that cash dividends will be paid at any time in the
foreseeable future as the Company intends to retain earnings, if any, for use in
the development of its business. The payment of dividends is contingent upon the
Company's future earnings, if any, the Company's financial condition and its
capital requirements, general business conditions and other
factors.





Equity
Compensation Plans




The
Company has not established any equity compensation plans as of the date of this
Annual Report on Form 10-K, however the Company reserves the right to do so at a
later date.





8








Item
5. Market for Registrant’s
Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities - continued




Recent
Sales of Unregistered Securities





The
following table sets forth information about our unregistered sales of common
stock during the three month period ended December 31, 2008:




Name
      of Purchaser
              
              Number
      of Shares of Common Stock
              
              
              Price
              
              RelationshipPelle
      Ojasu (1)
              
              
              12,000,0000
              
              
              $
              240,000
              
              Board
      MemberDavid
      Fiedler (2)
              
              
              1,000,000
              
              
              $
              15,000
              
              ShareholderHoward
      Rubin (3)
              
              
              1,000,000
              
              
              $
              15,000
              
              ShareholderJordan
      Erber (4)
              
              
              300,000
              
              
              $
              4,500
              
              Shareholder




1.
            Mr.
      Ojasu provided services in payment for these shares issued to
      him.2.
            Mr.
      Fiedler provided cash in payment for these shares issued to
      him.3.
            Mr.
      Rubin provided cash in payment for these shares issued to
him.4.
            Mr.
      Erber provided cash in payment for these shares issued to
    him.




Exemptions
from Registration for Sales of Restricted Securities.





These
securities were issued to persons who were either “accredited investors,” or
“sophisticated investors” who, by reason of education, business acumen,
experience or other factors, were fully capable of evaluating the risks and
merits of an investment in us; and each had prior access to all material
information about us. We believe that the offer and sale of these securities was
exempt from the registration requirements of the Securities Act pursuant to
Sections 4(2) under the Securities Act of 1933 (the “Act”) thereof, and/or Rule
506 of Regulation D of the Act. Section 18 of the Act preempts state
registration requirements for sales to these classes of persons.





Repurchase
of Securities




During
the fiscal year ended December 31, 2008, the Company did not purchase any of its
common stock shares and the Company is not likely to purchase any shares in the
foreseeable future.





Stock
Option Grants





The
Company does not have any compensatory stock option grants outstanding at this
time.




Item
6. Selected Financial Data.




As a
smaller reporting company, we are not required to provide risk
factors.




Item 7. Management’s Discussion and
Analysis of Financial Condition and Results of
Operations.





The
following discussion contains certain forward-looking statements that are
subject to business and economic risks and uncertainties, and which speak only
as of the date of this annual report. No one should place strong or undue
reliance on any forward-looking statements.  The Company’s actual
results or actions may differ materially from these forward-looking statements
for many reasons. This Item should be read in conjunction with the financial
statements and related notes and with the understanding that the Company’s
actual future results may be materially different from what is currently
expected or projected by the Company.





9





Item 7. Management’s Discussion and
Analysis of Financial Condition and Results of Operations -continued




The
following discussion and analysis should be read in conjunction with the audited
financial statements and notes thereto appearing elsewhere in this annual report
on Form 10-K.





Plan
of Operation





During
the year ended December 31, 2008, the Company has taken the following steps to
implement its business plan:




·
            To
      date the Company has devoted its time towards establishing its business in
      the exploration and salvage of artifacts and cargo from a shipwreck
      located off of Juno Beach,
Florida.





·
            Although
      the Company has not generated revenues to date our development activities
      continue to evolve. We have been a development stage company since
      inception, in accordance with Statement of Financial Accounting Standards
      No. 7.





·
            The
      Company completed the acquisition of Seafarer, and as a result we are no
      longer a shell company as defined in Rule 144(i) under the Securities Act
      of 1933.  As discussed in Note 1 to our consolidated financial
      statements, the acquisition of Seafarer was characterized as a
      reverse-acquisition. Accordingly, the results of operations discussed in
      this Item 7, relate to the consolidated financial assets and liabilities
      and operations of Seafarer, Inc., as if it had been Organetix during the
      periods being discussed.





If we are
unable to effectively locate and recover artifacts that have significant value
from the Juno Beach shipwreck site then we may have to suspend or cease our
efforts. The Company is also interested in locating other shipwreck sites
performing exploration and recovery efforts on other historic shipwreck sites.
Furthermore the Company has also entered into an agreement to obtain information
regarding the theoretical location and details of a deepwater shipwreck, however
the Company does not have the capital to meet its obligations under the
agreement and therefore has not obtained the information regarding the deepwater
shipwreck. Even if the Company is able to obtain the information regarding the
deepwater shipwreck there will be significant amounts of additional capital
required to actually pinpoint the exact location of the wreck and/or to conduct
recovery operations. At this time the Company does not have any formal plans to
raise the capital that will be necessary locate, explore and recover the
deepwater shipwreck. If the Company ceases its previously stated efforts there
are not any plans to pursue other business opportunities.





Limited
Operating History





Previously,
the Company devoted its time towards establishing its business and no revenues
have been generated to date. As such, the Company is considered as being in the
development stage, since its inception, in accordance with Statement of
Financial Accounting Standards No. 7, and its year-end is December 31. The
Company has not currently generated any revenue from operations and does not
expect to report any significant revenue from operations for the foreseeable
future.





The
Company is a development stage company. In a development stage company,
management devotes most of its activities to establishing a new business. As of
December 31, 2008, the Company had a working capital deficit of $88,020. The
Company is in immediate need of further working capital and is seeking options
with respect to financing in the form of debt, equity or a combination thereof.
Since inception, the Company has funded its operations through common stock
issuances and loans in order to meet its strategic
objectives.  However, there can be no assurance that the Company will
be able to obtain further funds to continue with its efforts to establish a new
business.










10





Item 7. Management’s Discussion and
Analysis of Financial Condition and Results of Operations - continued




Limited Operating History - continued




The
Company expects to continue to incur significant operating losses and to
generate negative cash flow from operating activities while exploring and
attempting to salvage artifacts from the Juno Beach shipwreck and establishing
itself in the marketplace. We expect to expend our available cash in less
than one month from May 5, 2009 based on our historical rate of
expenditures. The Company’s ability to eliminate operating losses and to
generate positive cash flow from operations in the future will depend upon a
variety of factors, many of which it is unable to control. If the Company is
unable to implement the Company’s business plan successfully, it may not be able
to eliminate operating losses, generate positive cash flow, or achieve or
sustain profitability, which have a material adverse effect on the Company’s
business, operations, and financial results, as well as its ability to make
payments on its debt obligations and the Company may be forced to cease its
operations.





Results
of Operations





Since
February 5, 2007, our inception, we have generated no revenues.  Our
operating and other expenses from inception through December 31, 2008 are
$1,260,847 of which $971,928 was incurred during the eight months ended December
31, 2008 and $283,625 was incurred during the twelve months ended April 30,
2008. Our major expenses were for consulting and independent contractor expenses
mostly related to fees for corporate development, management, accounting, and
corporate communications services as well as for the personnel involved in the
exploration and recovery efforts at the Juno Beach shipwreck site including the
divers and archeologist. Since inception, we incurred $130,599 in vessel
expenses related to repair, maintenance and operation of our vessel, the Iron
Maiden. Since inception we have incurred $108,266 in professional fees related
to legal, accounting, and auditing services.





Liquidity
and Capital Resources




As of
December 31, 2008, we had cash on hand of $474.00.  As of May 5, 2009,
we had cash on hand of $6,654.60.  During the eight months ended
December 31, 2008, and the period from inception on February 5, 2007 to December
31, 2008, we incurred net losses of ($972,078) and ($1,259,736) respectively. We
had $200,995 in current assets and $289,015 in current liabilities at December
31, 2008, leaving us a working capital deficit of ($88,020).





Subsequent
to December 31, 2008 Seafarer has funded operations through the receipt of
$120,000 from Blue Water Ventures of Key West, Inc. in partial repayment of the
money owed to the Company by Blue Water Ventures of Key West, Inc. The Company
has received $47,500 from the issuance of common stock under subscription
agreements, and Seafarer has received $46,500 in proceeds from convertible
promissory notes and loans.




The
Company is presently seeking additional financing. We expect to expend our
available cash in less than one month from May 5, 2009 based on our historical
rate of expenditures. The Company depends upon activities such as subsequent
offerings of our common stock or debt financing in order to operate and grow the
business. The Company has no specific plans for selling its common stock and no
arrangements for debt financing.  There can be no assurance the
Company will be successful in raising additional capital. There are may be other
risks and circumstances that management may be unable to predict.




The
Company’s ability to obtain additional financing will be subject to a variety of
uncertainties. These conditions raise substantial doubt about our ability to
continue as a going concern. The inability to raise additional funds on terms
favorable to the Company, or at all, could have a material adverse effect on the
Company’s business, financial condition and results of operations. If the
Company is unable to obtain additional capital, it will be forced to scale back
planned expenditures, which would adversely affect its business and financial
condition.





Promissory
Notes - Default





At
December 31, 2008, the Company had $105,000 in convertible promissory notes
outstanding. The notes pay interest at 6% and are convertible at the option of
the lenders into common stock at $0.10 per share.  The notes are
payable between September 1, 2008 through June 1, 2009 and are secured by the
equipment, fixtures, inventory, accounts receivable and intellectual property of
the Company.  All of these notes were issued prior to the June 2008
merger discussed in Note 1. These convertible promissory notes are currently in
default due to non-payment of principal and interest.





11





Item 7. Management’s Discussion and
Analysis of Financial Condition and Results of Operations - continued
  Promissory Notes - Default - continued





At
December 31, 2008, the Company has three promissory notes outstanding totaling
$36,500. These notes have a maturity of one year, carry an annual interest rate
of 8% and pay interest on a quarterly basis. These notes are unsecured and are
not convertible. These notes are currently in default due to non-payment
principal and interest.





The
Company does not have additional sources of debt financing to refinance its
promissory notes that are currently in default.  If the Company is
unable to obtain additional capital, such lenders may file suit, including suit
to foreclose on the assets held as collateral for obligations arising under the
secured notes.





Critical
Accounting Policies





Our
discussion and analysis of our financial condition and results of operations are
based upon our financial statements, which have been prepared in accordance with
accounting principles generally accepted in the United States of
America.  The preparation of these consolidated financial statements
requires us to make estimates and judgments which affect the reported amounts of
assets, liabilities, revenues and expenses, and related disclosures of
contingent assets and liabilities.  For a description of those
estimates, see Note 3, Summary of Significant Accounting Policies, contained in
the explanatory notes to the Company’s financial statements for the transition
period ended December 31, 2008, contained in this filing.  On an
ongoing basis, we evaluate our estimates.  We base our estimates on
historical experience and on various other assumptions which we believe to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying value of assets and liabilities which are
not readily apparent from other sources.  Actual results may differ
from these estimates under different assumptions or
conditions.  However, we believe that our estimates, including those
for the above-described items, are reasonable.





Critical
Accounting Estimates





Management
is aware that certain changes in accounting estimates employed in generating
financial statements can have the effect of making the Company look more or less
profitable than it actually is.  Management does not believe that
either the Company or its auditors have made any such changes in accounting
estimates.





Recent
Accounting Pronouncements





We have
reviewed accounting pronouncements and interpretations thereof that have
effectiveness dates during the periods reported and in future periods. We
believe that the following impending standards may have an impact on our future
filings.  The applicability of any standard is subject to the formal
review of our financial management and certain standards are under
consideration.





In
December 2007, the FASB issued Statement No. 141(R), “Business Combinations”
(SFAS 141(R)), which applies to all transactions or other events in which an
entity obtains control of one or more businesses, including those sometimes
referred to as “true mergers” or “mergers of equals” and combinations achieved
without the transfer of consideration. This statement replaces FASB Statement
No. 141 and applies to all business entities, including mutual entities that
previously used the pooling-of-interests method of accounting for some business
combinations. SFAS 141(R) is effective for fiscal years beginning after December
15, 2008, with early adoption prohibited. The Company believes that adoption of
SFAS 141(R) will have an effect on our operating results with respect to future
acquisitions, if any.










12





Item 7. Management’s Discussion and
Analysis of Financial Condition and Results of Operations - continued




Recent Accounting Pronouncements
-continued




In
February 2008, the FASB issued FASB Staff Position No. 157-1, “Application of
FASB Statement No. 157 to FASB Statement No. 13 and Other Accounting
Pronouncements That Address Fair Value Measurements for Purposes of Lease
Classification or Measurement under Statement 13” (FSP 157-1). FSP 157-1 amends
SFAS 157 to remove certain leasing transactions from its scope. In addition, on
February 12, 2008, the FASB issued FASB Staff Position No. 157-2, “Effective
Date of FASB Statement No. 157” (FSP 157-2), which amends SFA 157 by
delaying its effective date by one year for non-financial assets and
non-financial liabilities, except for items that are recognized or disclosed at
fair value in the financial statements on a recurring basis. This pronouncement
was effective upon issuance. The Company has deferred the adoption of SFAS 157
with respect to all non-financial assets and liabilities in accordance with the
provisions of this pronouncement. On January 1, 2009, SFAS 157 will be applied
to all other fair value measurements for which the application was deferred
under FSP 157-2. The Company is currently assessing the impact SFAS 157 will
have in relation to non-financial assets and liabilities on the consolidated
financial statements.





In March
2008, the FASB issued Statement No. 161, “Disclosures about Derivative
Instruments and Hedging Activities” (SFAS 161). SFAS 161 amends and expands the
disclosure requirements of Statement No. 133, “Accounting for Derivative
Instruments and Hedging Activities.” It requires qualitative disclosures about
objectives and strategies for using derivatives, quantitative disclosures about
credit-risk-related contingent features in derivative agreements. SFAS 161 is
effective for financial statements issued for fiscal years and interim periods
beginning after November 15, 2008. The Company does not anticipate the adoption
of SFAS 161 will have a material impact on its results of operations, cash flows
or financial condition.





In June
2008, the FASB’s Emerging Issues Task Force reached a consensus regarding EITF
Issue No. 07-5, “Determining Whether an Instrument (or Embedded Feature) Is
Indexed to an Entity’s Own Stock” (EITF 07-5). EITF 07-5 outlines a two-step
approach to evaluate the instrument’s contingent exercise provisions, if any,
and to evaluate the instrument’s settlement provisions when determining whether
an equity-linked financial instrument (or embedded feature) is indexed to an
entity’s own stock. EITF 07-5 is effective for fiscal years beginning after
December 15, 2008 and must be applied to outstanding instruments as of the
beginning of the fiscal year of adoption as a cumulative-effect adjustment to
the opening balance of retained earnings. Early adoption is not permitted. The
Company is currently evaluating the impact of the adoption of EITF
07-5.





Off-balance
Sheet Arrangements




None.





Item
7A. Quantitative and Qualitative Disclosures About Market Risk.





Not
required for smaller reporting companies.













13




Item
8. Financial Statements and Supplementary Data.




Financial
Statements of Seafarer Exploration Corp


Index to Financial
Statements











PageReport
      of Independent Registered Public Accounting Firm
                  F-1Consolidated
      Balance Sheets
                  F-2Consolidated
      Statements of Operations
                  F-3Consolidated
      Statements of Stockholders’ Equity
                  F-4Consolidated
      Statements of Cash Flows
                  F-5Note
      of Consolidated Financial Statements
                  F-6





14








REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM














Board of
Directors and Stockholders


Seafarer
Exploration Corp.




We have
audited the accompanying consolidated balance sheets of Seafarer Exploration
Corp. (“the Company”) as of December 31, 2008 and April 30, 2008, and the
related consolidated statements of operations, stockholders’ equity, and cash
flows for the periods then ended. These financial statements are the
responsibility of the Company’s management. Our responsibility is to express an
opinion on these financial statements based on our audits.




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




In our
opinion, the consolidated financial statements referred to above present fairly,
in all material respects, the financial position of Seafarer Exploration Corp.
as of December 31, 2008 and April 30, 2008, and the results of its
operations and its cash flows for the periods then ended, in conformity with
accounting principles generally accepted in the United States.





The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern.  As discussed in Note 2, the Company
incurred net losses and negative cash flows from operations since
inception.  These factors, and the need for additional financing in
order for the Company to meet its business plans, raise substantial doubt about
the Company's ability to continue as a going concern. Management's plans in
regard to these matters are also described in Note 2.  The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.





/s/
CROSS, FERNANDEZ & RILEY, LLP





Tampa,
Florida


May 8,
2009








15





SEAFARER
EXPLORATION CORP.


(A
Development Stage Company)


Consolidated Balance Sheets





December
      31,
                                                                                                                                                      2008
                                                                                                                                                    
                                                                                                                                                    April
      30,
                                                                                                                                                      2008ASSETSCurrentCash
                                                                                                                                                    
                                                                                                                                                    $
                                                                                                                                                    474
                                                                                                                                                    
                                                                                                                                                    $
                                                                                                                                                    108,280Notes
      receivable
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    180,521
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    75,000Deposits
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    21,284
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    --Total
      Current Assets
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    202,279
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    183,280Fixed
      assets, net of accumulated depreciation of $37,917 and
    $16,250
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    287,085
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    308,750Total
      Assets
                                                                                                                                                    
                                                                                                                                                    $
                                                                                                                                                    489,364
                                                                                                                                                    
                                                                                                                                                    $
                                                                                                                                                    492,030LIABILITIES
      AND STOCKHOLDERS' DEFICITCurrentAccounts
      payable and accrued liabilities
                                                                                                                                                    
                                                                                                                                                    $
                                                                                                                                                    147,415
                                                                                                                                                    
                                                                                                                                                    $
                                                                                                                                                    895Due
      to Organetix, Inc.
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    --
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    91,500Convertible
      notes payable, in default
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    90,000
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    64,000Convertible
      notes payable - related parties, in default
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    15,000
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    --Notes
      Payable – related parties, in default
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    56,500
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    --Due
      to shareholder
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    100
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    100Total
      Current Liabilities
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    309,015
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    156,495Total
      Liabilities
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    309,015
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    156,495Mezzanine
      equity - common stock, 3,966,668 shares par value $0.0001
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    64,500
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    --Commitments
      and contingencies
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    --
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    --Stockholders'
      EquityPreferred
      Stock, Authorized 50,000,000 shares; par value $0.0001, None issued and
      outstanding
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    --
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    -Common
      stockAuthorized:500,000,000
      common shares, par value $0.0001 per shareIssued
      and outstanding:276,609,557
      common shares (April 30, 2008 – 17,533,333,000)
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    27,661
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    1,753Additional
      paid-in capital
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    1,346,640
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    621,440Deficit
      accumulated during the development stage
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    (1,258,452
                                                                                                                                                    )
                                                                                                                                                    
                                                                                                                                                    (287,658
                                                                                                                                                    )Total
      Stockholders’ Equity
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    115,849
                                                                                                                                                    
                                                                                                                                                    
                                                                                                                                                    335,535Total
      Liabilities & Stockholders’ Equity
                                                                                                                                                    
                                                                                                                                                    $
                                                                                                                                                    489,364
                                                                                                                                                    
                                                                                                                                                    $
                                                                                                                                                    492,030


The
Accompanying Notes Are an Integral Part of these Financial
Statements





16


SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 Consolidated Statements of Operations


Eight
      Months Ended
                                                      December
      31,2008
                                                    
                                                    
                                                    Year
      Months ended April 30, 2008
                                                    
                                                    
                                                    February
      15,
                                                      2007
                                                      (Inception)
                                                      to
      December 31,2008REVENUES
                                                    
                                                    $
                                                    --
                                                    
                                                    
                                                    $
                                                    --
                                                    
                                                    
                                                    $
                                                    --EXPENSESConsulting
      & contractor expenses
                                                    
                                                    
                                                    615,887
                                                    
                                                    
                                                    
                                                    157,594
                                                    
                                                    
                                                    
                                                    776,482Vessel
      expenses
                                                    
                                                    
                                                    83,439
                                                    
                                                    
                                                    
                                                    46,836
                                                    
                                                    
                                                    
                                                    130,276Professional
      fees
                                                    
                                                    
                                                    97,689
                                                    
                                                    
                                                    
                                                    27,577
                                                    
                                                    
                                                    
                                                    127,266Travel
      & entertainment
                                                    
                                                    
                                                    74,048
                                                    
                                                    
                                                    
                                                    28,062
                                                    
                                                    
                                                    
                                                    102,110General
      and administrative expenses
                                                    
                                                    
                                                    53,110
                                                    
                                                    
                                                    
                                                    6,879
                                                    
                                                    
                                                    
                                                    60,284Rent
      expense
                                                    
                                                    
                                                    21,800
                                                    
                                                    
                                                    
                                                    425
                                                    
                                                    
                                                    
                                                    22,225Depreciation
                                                    
                                                    
                                                    21,665
                                                    
                                                    
                                                    
                                                    16,250
                                                    
                                                    
                                                    
                                                    37,915Other
      operating expenses
                                                    
                                                    
                                                    3,006
                                                    
                                                    
                                                    
                                                    2
                                                    
                                                    
                                                    
                                                    3,005Total
      Expenses
                                                    
                                                    
                                                    970,644
                                                    
                                                    
                                                    
                                                    283,625
                                                    
                                                    
                                                    
                                                    1,259,563Loss
      from Operations
                                                    
                                                    
                                                    (970,644
                                                    )
                                                    
                                                    
                                                    (283,625
                                                    )
                                                    
                                                    
                                                    (1,259,563
                                                    )OTHER
      (EXPENSE) INCOMEInterest
      expense
                                                    
                                                    
                                                    (5,690
                                                    )
                                                    
                                                    
                                                    (1,150
                                                    )
                                                    
                                                    
                                                    (6,840
                                                    )Interest
      income
                                                    
                                                    
                                                    5,540
                                                    
                                                    
                                                    
                                                    2,411
                                                    
                                                    
                                                    
                                                    7,951Total
      Other (Expense) Income
                                                    
                                                    
                                                    (150
                                                    )
                                                    
                                                    
                                                    1,261
                                                    
                                                    
                                                    
                                                    1,111NET
      LOSS
                                                    
                                                    $
                                                    (970,794
                                                    )
                                                    
                                                    $
                                                    (282,364
                                                    )
                                                    
                                                    $
                                                    (1,258,452
                                                    )NET
      LOSS PER SHARE - BASIC AND DILUTED
                                                    
                                                    $
                                                    (0.00
                                                    )
                                                    
                                                    $
                                                    (0.00
                                                    )WEIGHTED
      AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - BASIC AND
      DILUTED
                                                    
                                                    
                                                    262,970,299
                                                    
                                                    
                                                    
                                                    174,643,542


The
Accompanying Notes Are an Integral Part of these Financial
Statements











17







SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 Consolidated Statements of Cash Flows


8
      months ended December 31,2008
                                                          
                                                          
                                                          Year
      ended April 30, 2008
                                                          
                                                          
                                                          February
      15, 2007 (Inception) to December 31,2008CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      loss
                                                          
                                                          $
                                                          (970,794
                                                          )
                                                          
                                                          $
                                                          (282,364
                                                          )
                                                          
                                                          $
                                                          (1,258,452
                                                          )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Stock
      issued for services
                                                          
                                                          
                                                          323,333
                                                          
                                                          
                                                          
                                                          --
                                                          
                                                          
                                                          
                                                          323,333Depreciation
                                                          
                                                          
                                                          21,665
                                                          
                                                          
                                                          
                                                          16,250
                                                          
                                                          
                                                          
                                                          37,915Changes
      in operating assets and liabilities:DeDeposits
                                                          
                                                          
                                                          (21,284
                                                          )
                                                          
                                                          
                                                          --
                                                          
                                                          
                                                          
                                                          (21,284
                                                          )Accounts
      payable and accrued liabilities
                                                          
                                                          
                                                          146,520
                                                          
                                                          
                                                          
                                                          (1,105
                                                          )
                                                          
                                                          
                                                          238,915Due
      to Organetix, Inc.
                                                          
                                                          
                                                          --
                                                          
                                                          
                                                          
                                                          91,500Net
      cash used in operating activities
                                                          
                                                          
                                                          (500,560
                                                          )
                                                          
                                                          
                                                          (175,719
                                                          )
                                                          
                                                          
                                                          (679,573
                                                          )
      )CASH
      FLOWS FROM INVESTING ACTIVITIESNotes
      receivable
                                                          
                                                          
                                                          (105,521
                                                          )
                                                          
                                                          
                                                          (75,000
                                                          )
                                                          
                                                          
                                                          (180,521
                                                          )Acquisition
      of equipment
                                                          
                                                          
                                                          --
                                                          
                                                          
                                                          
                                                          (325,000
                                                          )
                                                          
                                                          
                                                          (325,000
                                                          )Net
      cash used in investing activities
                                                          
                                                          
                                                          (105,521
                                                          )
                                                          
                                                          
                                                          (400,000
                                                          )
                                                          
                                                          
                                                          (505,521
                                                          )CASH
      FLOWS FROM FINANCING ACTIVITIESIssuance
      of convertible notes
                                                          
                                                          
                                                          60,000
                                                          
                                                          
                                                          
                                                          64,000
                                                          
                                                          
                                                          
                                                          124,000Issuance
      of notes
                                                          
                                                          
                                                          56,500
                                                          
                                                          
                                                          
                                                          --
                                                          
                                                          
                                                          
                                                          56,500Issuance
      of common shares
                                                          
                                                          
                                                          381,775
                                                          
                                                          
                                                          
                                                          618,100
                                                          
                                                          
                                                          
                                                          1,005,068Net
      cash provided by financing activities
                                                          
                                                          
                                                          498275
                                                          
                                                          
                                                          
                                                          682,100
                                                          
                                                          
                                                          
                                                          1,166,568INCREASE
      (DECREASE) IN CASH
                                                          
                                                          
                                                          (107,806
                                                          )
                                                          
                                                          
                                                          106,381
                                                          
                                                          
                                                          
                                                          474CASH,
      BEGINNING
                                                          
                                                          
                                                          108,280
                                                          
                                                          
                                                          
                                                          1,899
                                                          
                                                          
                                                          
                                                          --CASH,
      ENDING
                                                          
                                                          $
                                                          474
                                                          
                                                          
                                                          $
                                                          108,280
                                                          
                                                          
                                                          $
                                                          474NONCASH
      OPERATING AND FINANCING ACTIVITIES:Due
      to Organetix, Inc. reclassified to additional paid-in
    capital
                                                          
                                                          $
                                                          91,500
                                                          
                                                          
                                                          $
                                                          -
                                                          
                                                          
                                                          $
                                                          91,500Convertible
      debt converted to common stock
                                                          
                                                          $
                                                          19,000
                                                          
                                                          
                                                          $
                                                          -
                                                          
                                                          
                                                          $
                                                          19,000SUPPLEMENTAL
      DISCLOSURE OF CASH FLOW INFORMATION:Cash
      paid for:Interest
                                                          
                                                          $
                                                          3,660
                                                          
                                                          
                                                          $
                                                          -
                                                          
                                                          
                                                          $
                                                          3,660Income
      taxes
                                                          
                                                          $
                                                          -
                                                          
                                                          
                                                          $
                                                          -
                                                          
                                                          
                                                          $
                                                          -


The
Accompanying Notes Are an Integral Part of these Financial
Statements





18





SEAFARER
EXPLORATION CORP.


(A
Development Stage Company)


Consolidated Statements of Stockholders’ Equity








Common
      Stock shares
                            
                            
                            Common
      Stock value
                            
                            
                            Additional
      Paid-in Capital
                            
                            
                            Deficit
      Accumulated During the Development Stage
                            
                            
                            TotalBalance,
      February -15, 2007 (Inception)
                            
                            
                            —
                            
                            
                            $
                            —
                            
                            
                            $
                            —
                            
                            
                            $
                            —
                            
                            
                            $
                            —Common
      stock issued for cash – February 20, 2007
                            
                            
                            5,000,000
                            
                            
                            
                            500
                            
                            
                            
                            4,693
                            
                            
                            
                            —
                            
                            
                            
                            5,193Net
      loss for the period from inception to April 30, 2007
                            
                            
                            —
                            
                            
                            
                            —
                            
                            
                            
                            —
                            
                            
                            
                            (5,294
                            )
                            
                            
                            (5,294
                            )Balance April 30,
      2007
                            
                            
                            5,000,000
                            
                            
                            
                            500
                            
                            
                            
                            4,693
                            
                            
                            
                            (5,294
                            )
                            
                            
                            (101
                            )Common
      stock issued for cash – June 15, 2007
                            
                            
                            5,000,000
                            
                            
                            
                            500
                            
                            
                            
                            4,500
                            
                            
                            
                            —
                            
                            
                            
                            5,000Common
      stock issued for subscription agreements – various dates
                            
                            
                            7,533,333
                            
                            
                            
                            753
                            
                            
                            
                            612,247
                            
                            
                            
                            —
                            
                            
                            
                            613,000Net
      loss
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            
                            (282,364
                            )
                            
                            
                            (282,364
                            )Balance
      April 30, 2008
                            
                            
                            17,533,333
                            
                            
                            
                            1,753
                            
                            
                            
                            621,440
                            
                            
                            
                            (287,658
                            )
                            
                            
                            335,535Recapitalization
      at reverse merger – June 4, 2008
                            
                            
                            233,522,002
                            
                            
                            
                            23,352
                            
                            
                            
                            68,148
                            
                            
                            
                            
                            
                            
                            
                            91,500Common
      stock issued for services – May 21, 2008
                            
                            
                            5,783,332
                            
                            
                            
                            578
                            
                            
                            
                            82,755
                            
                            
                            
                            —
                            
                            
                            
                            83,333Common
      stock issued for services – October 23, 2008
                            
                            
                            12,000,000
                            
                            
                            
                            1,200
                            
                            
                            
                            238,800
                            
                            
                            
                            —
                            
                            
                            
                            240,000Common
      stock issued on conversion of promissory note – November 1,
      2008
                            
                            
                            1,344,972
                            
                            
                            
                            134
                            
                            
                            
                            18,866
                            
                            
                            
                            —
                            
                            
                            
                            19,000Common
      stock issued for subscription agreements – various dates
                            
                            
                            6,425,918
                            
                            
                            
                            644
                            
                            
                            
                            356,131
                            
                            
                            
                            —
                            
                            
                            
                            356,775Reclassification
      to mezzanine equity
                            
                            
                            —
                            
                            
                            
                            —
                            
                            
                            
                            (64,500
                            )
                            
                            
                            —
                            
                            
                            
                            (64,500
                            )Funds
      received no shares issued – December 3, 2008
                            
                            
                            —
                            
                            
                            
                            —
                            
                            
                            
                            25,000
                            
                            
                            
                            —
                            
                            
                            
                            25,000Net
      loss
                            
                            
                            —
                            
                            
                            
                            —
                            
                            
                            
                            —
                            
                            
                            
                            (970,794
                            )
                            
                            
                            (970,794
                            )Balance,
      December 31,2008
                            
                            
                            276,609,557
                            
                            
                            $
                            27,661
                            
                            
                            $
                            1,346,640
                            
                            
                            $
                            (1,258,452
                            )
                            
                            $
                            115,849


The
Accompanying Notes Are an Integral Part of these Financial
Statements




















19
 
 SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 NOTES TO FINANCIAL STATEMENTS
 for
the fiscal year ended December 31, 2008







NOTE
1 – DESCRIPTION OF BUSINESS





Seafarer
Exploration Corp. (the “Company”) was incorporated on May 28, 2003 in the State
of Delaware.





The
principal business of the Company is the exploration and recovery of an
underwater shipwreck. The Company’s year-end is December 31.




The
Company is in the development stage and the Company’s activities during the
development stage include developing a business plan and raising
capital.





On June
4, 2008, Seafarer Exploration, Inc (“Seafarer Inc.”) merged with Organetix, Inc.
(“Organetix”) pursuant to a Share Exchange Agreement (the “Exchange Agreement”).
The Exchange Agreement provided for the exchange of all of Seafarer Inc.’s
common shares for 131,243,235 of Organetix post-merger common shares.
Considering that Seafarer Inc.’s former stockholders now control the majority of
Organetix’ outstanding voting common stock, Seafarer Inc.’s management has
actual operational control of Organetix and Organetix has effectively succeeded
its otherwise minimal operations to Seafarer Inc.’s operations, Seafarer Inc. is
considered the accounting acquirer in this reverse-merger transaction. A
reverse-merger transaction with a non-operating public shell company is
considered, and accounted for as a capital transaction in substance; it is
equivalent to the issuance of Seafarer Inc.’s common stock for the net monetary
assets of Organetix, accompanied by a recapitalization. Accordingly, the
accounting does not contemplate the recognition of unrecorded assets of the
accounting acquiree, such as goodwill. However, on the date of the merger,
Organetix was a blank-check public shell company and had no assets and no
liabilities. Consolidated financial statements presented herein and subsequent
to the merger reflect the consolidated financial assets and liabilities and
operations of Seafarer Inc., at their historical costs, giving effect to the
recapitalization, as if it had been Organetix during the periods
presented.





On July
17, 2008, we changed our name from Organetix, Inc. to Seafarer Exploration Corp.
During 2008, we changed our year end from April 30 to December 31.





NOTE
2 - GOING CONCERN





These
financial statements have been prepared on a going concern basis which assumes
the Company will be able to realize its assets and discharge its liabilities in
the normal course of business for the foreseeable future. As shown in the
accompanying financial statements, the Company has incurred net losses of
$1,259,736 since inception. We expect to expend our available cash in less than
one month from May 5, 2009 based on our historical rate of expenditures.
Management's plans include raising capital through the equity markets to fund
operations, and the generating of revenue through its business.





20
 
 SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 NOTES TO FINANCIAL STATEMENTS
 for
the fiscal year ended December 31, 2008





NOTE 2 - GOING CONCERN - continued




Failure
to raise adequate capital and generate adequate revenues could result in the
Company having to curtail or cease operations. The Company’s ability to raise
additional capital through the future issuances of the common stock is unknown.
Additionally, even if the Company does raise sufficient capital to support its
operating expenses and generate adequate revenues, there can be no assurances
that the revenue will be sufficient to enable it to develop to a level where it
will generate profits and cash flows from operations. These matters raise
substantial doubt about the Company's ability to continue as a going concern.
However, the accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and satisfaction of
liabilities in the normal course of business. These financial statements do not
include any adjustments relating to the recovery of the recorded assets or the
classifications of the liabilities that might be necessary should the Company be
unable to continue as a going concern.







NOTE
3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES




This
summary of significant accounting policies of Seafarer Exploration Corp. is
presented to assist in understanding the Company’s financial
statements.  The financial statements and notes are representations of
the Company’s management, who are responsible for their integrity and
objectivity.  These accounting policies conform to accounting
principles generally accepted in the United States of America, and have been
consistently applied in the preparation of the financial
statements.





Accounting
Method


The
Company’s financial statements are prepared using the accrual basis of
accounting in accordance with accounting principles generally accepted in the
United States of America.





Cash and Cash
Equivalents


For
purposes of the statement of cash flows, the Company considers all highly liquid
investments and short-term debt instruments with original maturities of three
months or less to be cash equivalents.





Revenue
Recognition


The
Company recognizes revenue on arrangements in accordance with Securities and
Exchange Commission Staff Accounting Bulletin No. 101, “Revenue Recognition in
Financial Statements” and No. 104, “Revenue Recognition”. In all cases, revenue
is recognized only when the price is fixed or determinable, persuasive evidence
of an arrangement exists, the service is performed and collectability is
reasonably assured. For the fiscal years ended December 31, 2008 and April 30,
2008, the Company did not report any revenues.





Earnings Per
Share


The
Company has adopted Statement of Financial Accounting Standards No. 128, which
provides for calculation of "basic" and "diluted" earnings per
share.  Basic earnings per share includes no dilution and is computed
by dividing net income (loss) available to common shareholders by the weighted
average common shares outstanding for the period.  Diluted earnings
per share reflect the potential dilution of securities that could share in the
earnings of an entity similar to fully diluted earnings per
share.  Basic and diluted losses per share were the same at the
reporting dates as there were no common stock equivalents outstanding during the
fiscal years ended December 31, 2008 and April 30, 2008.





Fair Value of Financial
Instruments





Effective
January 1, 2008, the Company adopted Statement of Financial Accounting Standards
(SFAS) No. 157 “Fair Value Measurements” (SFAS 157) which defines fair value,
establishes a framework for measuring fair value and expands required disclosure
about fair value measurements of assets and liabilities. The impact of adopting
SFAS 157 as of January 1, 2008 was not significant to the Company’s financial
statements. SFAS 157 defines fair value as the exchange price that would be
received for an asset or paid to transfer a liability (an exit price) in the
principal or most advantageous market for the asset or liability in an orderly
transaction between market participants on the measurement date. SFAS 157 also
establishes a fair value hierarchy, which requires an entity to maximize the use
of observable inputs and minimize the use of unobservable inputs when measuring
fair value. The standard describes three levels of inputs that may be used to
measure fair value:





21
 
 SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 NOTES TO FINANCIAL STATEMENTS
 for
the fiscal year ended December 31, 2008







NOTE 3 – SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES - continued




Fair Value of Financial
Instruments - continued




Level 1 –
Valuation based on quoted market prices in active markets for identical assets
or liabilities.





Level 2 –
Valuation based on quoted market prices for similar assets and liabilities in
active markets.





Level 3 –
Valuation based on unobservable inputs that are supported by little or no market
activity, therefore requiring management’s best estimate of what market
participants would use as fair value.





Fair
value estimates discussed herein are based upon certain market assumptions and
pertinent information available to management as of December 31,
2008.  The respective carrying value of certain on-balance-sheet financial
instruments approximated their fair values due to the short-term nature of these
instruments.  These financial instruments include cash, notes
receivable, accounts payable and accrued expenses. The fair value of the
Company’s long-term debt is estimated based on current rates that would be
available for debt of similar terms which is not significantly different from
its stated value.





Income
Taxes


The
Company provides for federal and state income taxes payable, as well as for
those deferred because of the timing differences between reporting income and
expenses for financial statement purposes versus tax purposes. Deferred tax
assets and liabilities are recognized for the future tax consequences
attributable to differences between the carrying amount of assets and
liabilities for financial reporting purposes and the amounts used for income tax
purposes. Deferred tax assets and liabilities are measured using the enacted tax
rates expected to apply to taxable income in the years in which those temporary
differences are expected to be recoverable or settled. The effect of a change in
tax rates is recognized as income or expense in the period of the change. A
valuation allowance is established, when necessary, to reduce deferred income
tax assets to the amount that is more likely than not to be
realized.





The
Company adopted the provisions of FASB Interpretation No. 48, “Accounting for
Uncertainty in Income Taxes”, on January 1, 2007. The Company has not recognized
a liability as a result of the implementation of Interpretation 48. A
reconciliation of the beginning and ending amount of unrecognized tax benefits
has not been provided since there is no unrecognized benefit as of the date of
adoption. The Company has not recognized interest expense or penalties as a
result of the implementation of Interpretation 48. If there were an unrecognized
tax benefit, the Company would recognize interest accrued related to
unrecognized tax benefits in interest expense and penalties in operating
expenses.





Fixed Assets and
Depreciation


Fixed
assets are recorded at historical cost. Depreciation is computed on the
straight-line method over estimated useful lives of the respective assets.
Currently our only asset is a diving vessel, which we purchased for $325,000
during 2008 and is being depreciated over a 10 year useful life.





Impairment of Long-Lived
Assets


In
accordance with Statement of Financial Accounting Standards ("SFAS") No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets," the Company
reviews the carrying amount of long-lived assets on a regular basis for the
existence of facts or circumstances, both internally and externally, that
suggest impairment. The Company determines if the carrying amount of a
long-lived asset is impaired based on anticipated undiscounted cash flows before
interest from the use of the asset. In the event of impairment, a loss is
recognized based on the amount by which the carrying amount exceeds the fair
value of the asset. Fair value is determined based on appraised value of the
assets or the anticipated cash flows from the use of the asset, discounted at a
rate commensurate with the risk involved. There was no impairment charges
recorded during each of the years ended December 31, 2008 and April 30,
2008.





22
 
 SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 NOTES TO FINANCIAL STATEMENTS
 for
the fiscal year ended December 31, 2008
  NOTE 3 – SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES - continued


Stock-Based
Compensation
 In
December 2004, the FASB issued SFAS No.123 (revised 2004), "Share-Based
Payment". SFAS 123(R) will provide investors and other users of financial
statements with more complete and neutral financial information by
requiring that the compensation cost relating to share-based payment
transactions be recognized in financial statements. That cost will be measured
based on the fair value of the equity or liability instruments issued. SFAS
123(R) covers a wide range of share-based compensation arrangements including
share options, restricted share plans, performance-based awards, share
appreciation rights, and employee share purchase plans. SFAS 123(R) replaces
FASB Statement No. 123, "Accounting for Stock-Based Compensation", and
supersedes APB Opinion No. 25, "Accounting for Stock Issued to Employees". SFAS
123, as originally issued in 1995, established as preferable a fair-value-based
method of accounting for share-based payment transactions with employees.
However, that statement permitted entities the option of continuing to apply the
guidance in Opinion 25, as long as the footnotes to financial statements
disclosed what net income would have been had the preferable fair-value-based
method been used. Public entities (other than those filing as small business
issuers) were required to apply SFAS 123(R) as of the first interim or annual
reporting period that begins after June 15, 2005. For public entities that file
as small business issuers, SFAS 123(R) was applicable as of the beginning of the
first interim or annual reporting period that begins after December 15, 2005. As
of December 31, 2008, the Company has not implemented a stock based compensation
plan.





Non-Employee Stock Based
Compensation


The
Company accounts for stock based compensation awards issued to non-employees for
services, as prescribed by SFAS No. 123R, at either the fair value of the
services rendered or the instruments issued in exchange for such services,
whichever is more readily determinable, using the measurement date guidelines
enumerated in EITF 96-18, "Accounting for Equity Instruments That Are Issued to
Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or
Services."





Use of
Estimates


The
process of preparing financial statements in conformity with accounting
principles generally accepted in the United States of America requires the use
of estimates and assumptions regarding certain types of assets, liabilities,
revenues, and expenses.  Such estimates primarily relate to unsettled
transactions and events as of the date of the financial
statements.  Accordingly, upon settlement, actual results may differ
from estimated amounts.




Convertible Notes
Payable


The
Company accounts for conversion options embedded in convertible notes in
accordance with SFAS No. 133 "Accounting for Derivative Instruments and Hedging
Activities" ("SFAS 133") and Emerging Issues Task Force EITF 00-19, "Accounting
for Derivative Financial Instruments Indexed to, and Potentially Settled in, a
Company's Own Stock" ("EITF 00-19"). SFAS 133 generally requires companies to
bifurcate conversion options embedded in convertible notes from their host
instruments and to account for them as free standing derivative financial
instruments in accordance with EITF 00-19. SFAS 133 provides for an exception to
this rule when convertible notes, as host instruments, are deemed to be
conventional as that term is described in the implementation guidance under
Appendix A to SFAS 133 and further clarified in EITF 05-2 "The Meaning of
"Conventional Convertible Debt Instrument" in Issue No. 00-19.”  As of
December 31, 2008 all of the Company’s convertible notes payable were classified
as conventional instruments.





The
Company accounts for convertible notes deemed conventional and conversion
options embedded in non-conventional convertible notes which qualify as equity
under EITF 00-19, in accordance with the provisions of Emerging Issues Task
Force Issue ("EITF") 98-5 "Accounting for Convertible Securities with Beneficial
Conversion Features," and EITF 00-27 "Application of EITF 98-5 to Certain
Convertible Instruments". Accordingly, the Company records, as a discount to
convertible notes, the intrinsic value of such conversion options based upon the
differences between the fair value of the underlying common stock at the
commitment date of the note transaction and the effective conversion price
embedded in the note. Debt discounts under these arrangements are amortized over
the term of the related debt.  As of December 31, 2008, none of the
Company’s convertible notes payable included a beneficial conversion
option.





Recent Accounting
Pronouncements





23
 
 SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 NOTES TO FINANCIAL STATEMENTS
 for
the fiscal year ended December 31, 2008





NOTE 3 – SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES - continued




Recent
Accounting Pronouncements -
continued




In June
2006, the FASB issued Interpretation No. 48, "Accounting for Uncertainty in
-Income Taxes-an interpretation of FASB Statement No. 109" ("FIN 48"), which
clarifies the accounting for uncertainty in income taxes. FIN 48 prescribes a
recognition threshold and measurement attribute for the financial statement
recognition and measurement of a tax position taken or expected to be taken in a
tax return. The Interpretation requires that the Company recognize in the
financial statements the impact of tax position, if that position is more likely
than not of being sustained on audit, based on the technical merits of the
position. FIN 48 also provides guidance on derecognition, classification,
interest and penalties, accounting in interim periods and disclosure. The
provisions of FIN 48 are effective for fiscal years beginning after December 15,
2006 with the cumulative effect of the change in accounting principle recorded
as an adjustment to beginning retained earnings. The adoption of this statement
did not have a material impact on the Company's consolidated financial position
or results of operations.





In
September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements". This
standard defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles, and expands disclosures about fair
value measurements. This statement is effective for financial statements issued
for fiscal years beginning after November 15, 2007. The adoption of this
accounting pronouncement did not have a material effect on the Company’s
consolidated financial statements.





In
February 2007, the Financial Accounting Standards Board (FASB) issued SFAS No.
159, “The Fair Value Option
for Financial Assets and Financial Liabilities – Including an Amendment of FASB
Statement No. 115”.  This statement permits entities to choose
to measure many financial instruments and certain other items at fair value.
Most of the provisions of SFAS No. 159 apply only to entities that elect the
fair value option. However, the amendment to SFAS No. 115 “Accounting for Certain Investments
in Debt and Equity Securities” applies to all entities with
available-for-sale and trading securities. SFAS No. 159 is effective as of the
beginning of an entity’s first fiscal year that begins after November 15, 2007.
The adoption of this statement did not have a material effect on the Company's
financial statements.





In
December 2007, the FASB issued Statement No. 141(R), “Business Combinations”
(SFAS 141(R)), which applies to all transactions or other events in which an
entity obtains control of one or more businesses, including those sometimes
referred to as “true mergers” or “mergers of equals” and combinations achieved
without the transfer of consideration. This statement replaces FASB Statement
No. 141 and applies to all business entities, including mutual entities that
previously used the pooling-of-interests method of accounting for some business
combinations. SFAS 141(R) is effective for fiscal years beginning after December
15, 2008, with early adoption prohibited. The Company believes that adoption of
SFAS 141(R) will have an effect on our operating results with respect to future
acquisitions, if any.





In
February 2008, the FASB issued FASB Staff Position No. 157-1, “Application of
FASB Statement No. 157 to FASB Statement No. 13 and Other Accounting
Pronouncements That Address Fair Value Measurements for Purposes of Lease
Classification or Measurement under Statement 13” (FSP 157-1). FSP 157-1 amends
SFAS 157 to remove certain leasing transactions from its scope. In addition, on
February 12, 2008, the FASB issued FASB Staff Position No. 157-2, “Effective
Date of FASB Statement No. 157” (FSP 157-2), which amends SFA 157 by delaying
its effective date by one year for non-financial assets and non-financial
liabilities, except for items that are recognized or disclosed at fair value in
the financial statements on a recurring basis. This pronouncement was effective
upon issuance. The Company has deferred the adoption of SFAS 157 with respect to
all non-financial assets and liabilities in accordance with the provisions of
this pronouncement. On January 1, 2009, SFAS 157 will be applied to all other
fair value measurements for which the application was deferred under FSP 157-2.
The Company is currently assessing the impact SFAS 157 will have in relation to
non-financial assets and liabilities on the consolidated financial
statements.





In March
2008, the FASB issued Statement No. 161, “Disclosures about Derivative
Instruments and Hedging Activities” (SFAS 161). SFAS 161 amends and expands the
disclosure requirements of Statement No. 133, “Accounting for Derivative
Instruments and Hedging Activities.” It requires qualitative disclosures about
objectives and strategies for using derivatives, quantitative disclosures about
credit-risk-related contingent features in derivative agreements. SFAS 161 is
effective for financial statements issued for fiscal years and interim periods
beginning after November 15, 2008. The Company does not anticipate the adoption
of SFAS 161 will have a material impact on its results of operations, cash flows
or financial condition.





24
 
 SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 NOTES TO FINANCIAL STATEMENTS
 for
the fiscal year ended December 31, 2008







NOTE 3 – SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES - continued
  Recent
Accounting Pronouncements -
continued




In June
2008, the FASB’s Emerging Issues Task Force reached a consensus regarding EITF
Issue No. 07-5, “Determining Whether an Instrument (or Embedded Feature) Is
Indexed to an Entity’s Own Stock” (EITF 07-5). EITF 07-5 outlines a two-step
approach to evaluate the instrument’s contingent exercise provisions, if any,
and to evaluate the instrument’s settlement provisions when determining whether
an equity-linked financial instrument (or embedded feature) is indexed to an
entity’s own stock. EITF 07-5 is effective for fiscal years beginning after
December 15, 2008 and must be applied to outstanding instruments as of the
beginning of the fiscal year of adoption as a cumulative-effect adjustment to
the opening balance of retained earnings. Early adoption is not permitted. The
Company is currently evaluating the impact of the adoption of EITF
07-5.








NOTE
4 - LOSS PER SHARE





Components
of loss per share for the respective periods are as follows:








December
      31, 2008
                                                                                  
                                                                                  
                                                                                  April
      30, 2008Net
      income available to common shareholders
                                                                                  
                                                                                  $
                                                                                  (970,794)
                                                                                  
                                                                                  $
                                                                                  (282,364)Weighted
      average shares outstanding:Basic
      and diluted
                                                                                  
                                                                                  
                                                                                  262,970,299
                                                                                  
                                                                                  
                                                                                  174,643,542Loss
      per share:Basic
      and diluted
                                                                                  
                                                                                  $
                                                                                  (0.00)
                                                                                  
                                                                                  $
                                                                                  (0.00)











NOTE
5 – CAPITAL STOCK





Common
Stock


The
Company is authorized to issue 500,000,000 shares of $0.0001 par value common
stock.  All shares have equal voting rights, are non-assessable and
have one vote per share.  Voting rights are not cumulative and,
therefore, the holders of more than 50% of the common stock could, if they
choose to do so, elect all of the directors of the Company.





At
December 31, 2008 the Company had issued and outstanding 3,966,668 common shares
for total proceeds of $64,500 that are subject to a repricing feature
guaranteeing the shareholders a minimum value of $0.015 to $0.020 per share. The
repricing feature extends through the date upon which all registration
restrictions expire and is based upon the trading market value on that date. Due
to the fact that the number of shares required to settle this minimum value
guaranty will not be known until the registration restrictions have expired, the
Company cannot guarantee with certainty that it will have enough authorized
shares to settle these agreements. Accordingly, these shares have been accounted
for in accordance with EITF Topic No. D-98, Classification and Measurement of
Redeemable Securities. Pursuant to this guidance, the shares subject to
the anti-dilution protection require classification as mezzanine equity until
such time as the repricing feature expires.













25
 
 SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 NOTES TO FINANCIAL STATEMENTS
 for
the fiscal year ended December 31, 2008





NOTE 6 - INCOME
TAXES




The items
accounting for the difference between income taxes computed at the federal
statutory rate and the provision for income taxes are as follows:





2008
                              
                              2008Income
      tax at federal statutory rate
                              (34.00)
                              %
                              
                              (34.00)
                              %State
      tax, net of federal effect
                              (3.96)
                              %
                              
                              (3.96)
                              %37.96
                              %
                              
                              37.96
                              %Valuation
      AllowanceEffective
      rate
                              0.00
                              %
                              
                              0.00
                              %




Deferred
income taxes reflect the net tax effects of temporary differences between the
carrying amount of assets and liabilities for financial reporting purposes and
the amounts used for income tax purposes.




As of
December 31, 2008, the Company’s only significant deferred income tax asset was
an estimated net tax operating loss of ($1,258,452) that is available to offset
future taxable income if any in future periods, subject to expiration and other
limitations imposed by the Internal Revenue Service, if
any.  Management has considered the Company's operating losses
incurred to date, and believes that a full valuation allowance against its
deferred tax assets is required as of December 31, 2008 and April 30,
2008.





NOTE
7 – LEASE OBLIGATION





The
Company has an operating lease for its office space located in Tampa, Florida.
The term of the lease agreement commenced on October 1, 2008 and expires on
March 31, 2010. For the Year Ending December 31, 2008 the rental expense
including taxes was $3,853 and the Company also paid a security deposit in the
amount of $1,284.  Future minimum rental payments, including taxes,
required under the non-cancelable operating lease are as follows:





For the
Year Ending December 31,


2009 -
$15,410.64


2010 -
$3,852.66





NOTE
8 – NOTES PAYABLE





Convertible
Notes Payable





At
December 31, 2008 and April 30, 2008, respectively, the Company had $105,000 and
$64,000 in convertible promissory notes outstanding, of which $15,000 was
outstanding to related parties at December 31, 2008 and April 30, 2008. The
notes pay interest at 6% and are convertible at the option of the lenders into
common stock at $0.10 per share. The notes are payable between September 1, 2008
through June 1, 2009 and are secured by the equipment, fixtures, inventory,
accounts receivable and intellectual property of the Company. All of these notes
were issued prior to the June 2008 merger discussed in Note 1. These notes are
currently in default due to non-payment of principal and interest.





Payable
– related parties


At
December 31, 2008, the Company has three promissory notes outstanding totaling
$36,500. These notes have a maturity of one year, carry an annual interest rate
of 8% and pay interest on a quarterly basis. These notes are unsecured and are
not convertible. These notes are currently in default due to non-payment
principal and interest.





26
 
 SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 NOTES TO FINANCIAL STATEMENTS
 for
the fiscal year ended December 31, 2008








NOTE
9 - NOTES RECEIVABLE





At
December 31, 2008, the Company was owed a principal amount of $175,000 from Blue
Water Ventures of Key West, Inc., a corporation. The notes pay interest at a
rate of 4.5% per annum with interest due and payable when the notes mature. All
three of the notes matured on December 31, 2008. As of April 27, 2009 Seafarer
has received $120,000 in repayment of the money owed to the Company by Blue
Water Ventures of Key West, Inc. and the Company believes that the entire
principal amount of the notes receivable is collectible.





NOTE
10 – DIVISON OF ARTIFACTS AND TREASURE





The
Company must split any artifacts or treasure that it successfully recovers from
the Juno Beach shipwreck site with the State of Florida and Tulco Resources,
Ltd. The division of artifacts and treasure will be:





20% to
the State of Florida


40% to
Tulco Resources, Ltd.


40% to
the Company





More
specifically the State of Florida has the right to select up to 20% of the total
value of recovered artifacts and treasure for the State's museum collection.
After the State of Florida has selected those artifacts and treasure that it
feels will complement its collection then the Company and Tulco, Resources, Ltd.
will split the remaining artifacts and treasure equally.





NOTE
11 – LEGAL PROCEEDINGS





The
Company is not the subject of any pending legal proceedings and to the knowledge
of management, no proceedings are presently contemplated against the Company by
any federal, state or local governmental agency.





NOTE
12 – MATERIAL AGREEMENTS





Consulting
Agreement





On June
23, 2008 the Company entered into a consulting agreement with an individual.
Under the terms of the agreement the individual was going to provide the Company
with various business development, mergers and acquisitions and business
strategy consulting services at the direction of the Company’s Chief Executive
Officer. In consideration for performing the consulting services the Company
agreed to pay the individual 1,000,000 shares of its common stock. The agreement
states that the stock consideration was to be considered earned as of the
execution of the agreement. To the best of the Company’s knowledge the
individual never performed any services on behalf of the Company. The Company
has not issued any shares to the individual under the agreement and no expense
has been recorded through December 31, 2008.





Cancellation
of Purchase and Sale Agreement





The
purchase and sale agreement that was previously executed on July 2, 2008 by and
between Sinclair Educational Archaeological Research Expeditions, Inc. (“SeaRex,
Inc.”), James J. Sinclair, Vanessa E. Friedman, and the Company was cancelled on
December 9, 2008 by written consent of all of the parties to the
agreement.





27
 
 SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 NOTES TO FINANCIAL STATEMENTS
 for
the fiscal year ended December 31, 2008


NOTE 12 – MATERIAL AGREEMENTS - continued




New
Purchase and Sale Agreement with SeaRex, Inc.
  On
December 10, 2008, the Company entered into a new purchase and sale agreement
with Sinclair Educational Archaeological Research Expeditions, Inc. (“SeaRex,
Inc.”) to acquire the DaVinci Research Materials. The DaVinci
Research Materials purportedly contain information as to the theoretical
location of a deepwater shipwreck site which has been named the “DaVinci
Project”. As used in the agreement with SeaRex, Inc. the DaVinci Research
Materials refers to any and all of the documents, data, records, reports, maps,
compilations, computer models, writings and materials that are in any way
related to the DaVinci Project that have been accumulated by SeaRex, Inc. any
persons known to SeaRex, Inc. or any employees, contractors, consultants,
officers, directors, agents, affiliates, or associates of SeaRex, Inc. Under the
new agreement, the Company has agreed, in its sole discretion and if funds are
available, to pay SeaRex, Inc. a fee of $250,000 less any funds previously paid
to SeaRex, Inc. in exchange for the DaVinci Research Materials. SeaRex, Inc.
acknowledged that it previously received $10,000 from Seafarer towards the
purchase of the DaVinci Research Materials. According to the agreement, the
remaining fees will be paid in the following increments; $10,000 was due upon
execution of the Agreement; $30,000 was due by December 31, 2008 unless the
parties mutually agree to extend the due date; $50,000 was due by February 15,
2009 unless the parties mutually agree to extend the due date; and $150,000 was
be due by March 31, 2009 unless the parties mutually agree to extend the due
date. In addition to the fees, Seafarer agreed to pay SeaRex fourteen percent
(14%) of the net liquidated value of any items actually recovered from the
DaVinci Project less any and all expenses incurred by Seafarer relating to the
DaVinci Project (the “Contingent Fees”). The Contingent Fees will be paid to
SeaRex, Inc. at the time that Seafarer actually receives funds. The agreement
further states that Seafarer will have exclusive rights to the DaVinci Research
Materials during the term of the agreement. Additionally, if Seafarer does not
pay SeaRex, Inc. the fees by the due dates described previoulsy, then SeaRex,
Inc. in its sole discretion, may terminate the agreement by providing written
notice to Seafarer. If SeaRex, Inc. terminates the agreement then it agrees that
within five business days of providing written notice of termination it will pay
back any and all funds that it has received from Seafarer. SeaRex, Inc.
specifically acknowledges that if Seafarer does not pay the fees by any of the
due dates described previously, then Seafarer will not have any further
financial obligations whatsoever or owe any consideration or fees of any kind to
SeaRex. As of December 31, 2008 Seafarer has paid a total of $20,000 to SeaRex,
Inc. towards the purchase of the DaVinci Research Materials however the Company
has not been able to raise the capital necessary to complete the purchase of the
DaVinci Research Materials. Even if the Company is able to successfully obtain
the DaVinci Research Materials then there will be a significant amount of
additional capital required to actually to both pinpoint the exact location of
the DaVinci Project shipwreck and/or conduct recovery operations. At this
time the Company does not have any formal plans to raise the capital that will
be necessary locate, explore and recover the deepwater
shipwreck.





NOTE
12 – RELATED PARTY TRANSACTIONS





On July
23, 2007 Seafarer entered into a convertible promissory note in the amount of
$15,000 with Pelle Ojasu, a director of the Company.   The note
is convertible to common stock at $0.10 per share, is secured by substantially
all the assets of the company and bears interest at a rate of 6%.  The
note was due September 30, 2008 but remains outstanding at December 31, 2008.
The note is currently in default due to non-payment of principal and
interest.





On
September 9, 2008 Seafarer entered into a promissory note agreement in the
amount of $9,000 with a person who is related to the CEO of the Company. The
note is not secured and bears interest at the rate of 8% per annum. The note is
interest only with interest payments to be made quarterly. The note is due and
payable on September 9, 2009.





On
September 29, 2008 Seafarer entered into a promissory note agreement in the
amount of $12,500 with a corporation. Seafarer’s CEO is a Director of the
corporation. The note is not secured and bears interest at the rate of 8% per
annum. The note is interest only with interest payments to be made quarterly.
The note is due and payable on September 29, 2009.





On
October 24, 2008 Seafarer entered into a promissory note agreement in the amount
of $6,500 with a person who is related to the CEO of the Company. The note is
not secured and bears interest at the rate of 8% per annum. The note is interest
only with interest payments to be made quarterly. The note is due and payable on
October 24, 2009. The principal amount of the note was repaid in December
2008.




On
October 27, 2008 Seafarer entered into a promissory note agreement in the amount
of $15,000 with a person who is related to the CEO of the Company. The note is
not secured and bears interest at the rate of 8% per annum. The note is interest
only with interest payments to be made quarterly. The note is due and payable on
October 27, 2009.





28
 
 SEAFARER
EXPLORATION CORP.
 (A
Development Stage Company)
 NOTES TO FINANCIAL STATEMENTS
 for
the fiscal year ended December 31, 2008





NOTE
13 – SUBSEQUENT EVENTS





Subsequent
to December 31, 2008 the Company has received $120,000 from Blue Water Ventures
of Key West, Inc. in partial repayment of the money owed by Blue Water Ventures
of Key West, Inc. to Seafarer.





Subsequent
to December 31, 2008 the Company has received $47,500 from the issuance of
common stock under subscription agreements.




Subsequent
to December 31, 2008 the Company has received $46,500 in proceeds from
convertible promissory notes and loans.










Item
9. Changes in and Disagreements With Accountants on Accounting and Financial
Disclosure.





On March
17, 2009 we dismissed Meyler & Company, LLC (“Meyler”) as our principal
independent registered accountants and appointed Cross Fernandez & Riley,
LLP as our new principal independent registered accountants. There were no
disagreements between the Company and Meyler regarding any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure. The information required by Item 304 of Regulation S-K with respect
to the change in our independent accountants was provided in our Current Report
on Form 8-K, filed with the Securities and Exchange Commission on March 25, 2009
and Current Report on Form8-KA filed with the Securities and Exchange Commission
on April 28, 2009.





Item
9A(T). Controls and Procedures.





Management’s
responsibility for controls and procedures





The
Company’s management is responsible for establishing and maintaining adequate
internal control over the Company’s financial reporting. The Company’s controls
over financial reporting are designed to ensure that information required to be
disclosed by the Company in the reports that the Company files or submits under
the Securities Exchange Act of 1934, as amended (Exchange Act) is accumulated
and communicated to the Company’s management, including the Company’s principal
executive officer and principal financial officer, or persons performing similar
functions, as appropriate to allow timely decisions regarding required
disclosure.





Evaluation
of disclosure controls and procedures





Under the
supervision and with the participation of our principal executive officer and
principal financial officer, the Company conducted an evaluation of the
effectiveness of the design and operation of its disclosure controls and
procedures, as such term is defined under Rule 13a-15(e) promulgated under the
Exchange Act, as of December 31, 2008.  Based on this evaluation, the
Company’s principal executive officer and principal financial officer have
concluded that the Company’s disclosure controls and procedures as of the end of
such periods are not effective to ensure that information required to be
disclosed by the Company in the reports it files or submits under the Exchange
Act is recorded, processed, summarized, and reported within the time periods
specified in the Securities and Exchange Commission’s rules and
forms.










29





Item 9A(T). Controls and Procedures -
continued




Internal Control Over Financial
Reporting




Management
did not use a formal framework to conduct the required evaluation of the
effectiveness of the Company’s internal control over financial reporting since,
in the view of management, comparison with a formal framework was unwarranted
because of (i) the small size of the Company’s current operations and (ii) the
Company’s executive management structure (consisting of only the Company’s
principal executive officer and principal financial officer) which enables
management to be aware of all transactions.





The
company has limited resources and as a result, a material weakness in financial
reporting currently exists, because of our limited resources and personnel,
including those described below.





* The
Company has an insufficient quantity of dedicated resources and experienced
personnel involved in reviewing and designing internal controls. As a result, a
material misstatement of the interim and annual financial statements could occur
and not be prevented or detected on a timely basis.





* We have
not achieved the optimal level of segregation of duties relative to key
financial reporting functions.





* We do
not have an audit committee or an independent audit committee financial expert.
While not being legally obligated to have an audit committee or independent
audit committee financial expert, it is the managements view that to have audit
committee, comprised of independent board members, and an independent audit
committee financial expert is an important entity-level control over the
Company's financial statements.





* We have
not achieved an optimal segregation of duties for executive officers of the
Company.





A
material weakness is a deficiency (within the meaning of the Public Company
Accounting Oversight Board (PCAOB) auditing standard 5) or combination of
deficiencies in internal control over financial reporting such that there is a
reasonable possibility that a material misstatement of the Company's annual or
interim financial statements will not be prevented or detected on a timely
basis. Management has determined that a material weakness exists due to a lack
of segregation of duties, resulting from the Company's limited resources and
personnel.





Remediation
Efforts to Address Deficiencies in Internal Control Over Financial
Reporting





As a
result of these findings, management, upon obtaining sufficient capital and
operations, intends to take practical, cost-effective steps in implementing
internal controls, including possibly the following remedial
measures:





*Assessing
the current duties of existing personnel and consultants, assigning additional
duties to existing personnel and consultants, and, in a cost effective manner,
potentially hiring additional personnel to assist with the preparation of the
Company's financial statements to allow for proper segregation of duties, as
well as additional resources for control documentation.





*Assessing
the duties of the existing officers of the Company and, in a cost effective
manner, possibly promote or hire additional personnel to diversify duties and
responsibilities of such executive officers.





*Board to
review and make recommendations to shareholders concerning the composition of
the Board of Directors, with particular focus on issues of independence. The
Board of Directors to consider nominating an audit committee and audit committee
financial expert, which may or may not consist of independent
members.





*Interviewing
and potentially hiring outside consultants that are experts in designing
internal controls over financial reporting based on criteria established in
Internal Control Integrated Framework issued by Integrated Framework issued by
the Committee of Sponsoring Organizations of the Treadway Commission
(“COSO”).





30







Item 9A(T). Controls and Procedures -
continued




Remediation Efforts to Address
Deficiencies in Internal Control Over Financial Reporting - continued




This
annual report does not include an attestation report of our registered public
accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by our registered public
accounting firm pursuant to temporary rules of the SEC that permit us to provide
only management’s report in this annual report.





The
Company has not made any change in our internal control over financial reporting
during the transition period ended December 31, 2008.





Item
9B. Other Information.





Environmental
Permits/Agreement





In
December of 2008 Seafarer obtained environmental permits related to the
exploration and salvage of the Juno Beach shipwreck from the Department of the
Army/Corp. of Engineers and the Florida Department of Environmental Protection
(“DEP”). Seafarer also entered into an agreement with the Florida Sovereign
Submerged Land Trust (“FSSLT”). The permit from the Department of the Army/Corp.
of Engineers is conditionally effective until December 10, 2013. The permit from
the Florida DEP is conditionally effective until December 15, 2013. The
agreement with the FSSLT is conditionally in effect until December 22,
2013.





Cancellation
of Purchase and Sale Agreement





The
purchase and sale agreement that was previously executed on July 2, 2008 by and
between Sinclair Educational Archaeological Research Expeditions, Inc. (“SeaRex,
Inc.”), James J. Sinclair, Vanessa E. Friedman, and the Company was cancelled on
December 9, 2008 by written consent of all of the parties to the
agreement.





New
Purchase and Sale Agreement





On
December 10, 2008, the Company entered into a new purchase and sale agreement
with Sinclair Educational Archaeological Research Expeditions, Inc. (“SeaRex,
Inc.”) to acquire the DaVinci Research Materials. The DaVinci Research Materials
purportedly contain information as to the theoretical location of a deepwater
shipwreck site which has been named the “DaVinci Project”. As used in the
agreement with SeaRex, Inc. the DaVinci Research Materials refers to any and all
of the documents, data, records, reports, maps, compilations, computer models,
writings and materials that are in any way related to the DaVinci Project that
have been accumulated by SeaRex, Inc. any persons known to SeaRex, Inc. or any
employees, contractors, consultants, officers, directors, agents, affiliates, or
associates of SeaRex, Inc. Under the new agreement, the Company has agreed, in
its sole discretion and if funds are available, to pay SeaRex, Inc. a fee of
$250,000 less any funds previously paid to SeaRex, Inc. in exchange for the
DaVinci Research Materials. SeaRex, Inc. acknowledged that it previously
received $10,000 from Seafarer towards the purchase of the DaVinci Research
Materials. According to the agreement, the remaining fees will be paid in the
following increments; $10,000 was due upon execution of the Agreement; $30,000
was due by December 31, 2008 unless the parties mutually agree to extend the due
date; $50,000 was due by February 15, 2009 unless the parties mutually agree to
extend the due date; and $150,000 was be due by March 31, 2009 unless the
parties mutually agree to extend the due date. In addition to the fees, Seafarer
agreed to pay SeaRex fourteen percent (14%) of the net liquidated value of any
items actually recovered from the DaVinci Project less any and all expenses
incurred by Seafarer relating to the DaVinci Project (the “Contingent Fees”).
The Contingent Fees will be paid to SeaRex, Inc. at the time that Seafarer
actually receives funds. The agreement further states that Seafarer will have
exclusive rights to the DaVinci Research Materials during the term of the
agreement. Additionally, if Seafarer does not pay SeaRex, Inc. the fees by the
due dates described previously, then SeaRex, Inc. in its sole discretion, may
terminate the agreement by providing written notice to Seafarer. If SeaRex, Inc.
terminates the agreement then it agrees that within five business days of
providing written notice of termination it will pay back any and all funds that
it has received from Seafarer. SeaRex, Inc. specifically acknowledges that if
Seafarer does not pay the fees by any of the due dates described previously,
then Seafarer will not have any further financial obligations whatsoever or owe
any consideration or fees of any kind to SeaRex. As of December 31, 2008
Seafarer has paid a total of $20,000 to SeaRex, Inc. towards the purchase of the
DaVinci Research Materials however the Company has not been able to raise the
capital necessary to complete the purchase of the DaVinci Research Materials.
Even if the Company is able to successfully obtain the DaVinci Research
Materials then there will be a significant amount of additional capital required
to actually to both pinpoint the exact location of the DaVinci Project shipwreck
and/or conduct recovery operations. At this time the Company does not have any
formal plans to raise the capital that will be necessary locate, explore
and recover the deepwater shipwreck.





31





PART III





Item 10. Directors, Executive
Officers and Corporate Governance.





Name
              Age
              PositionKyle
      Kennedy
              48
              President,
      Chief Executive Officer, Chairman of the BoardChristopher
      Gilcher
              38
              Chief
      Financial OfficerPelle
      Ojasu
              39
              DirectorMary
      Pecoraro*
              43
              Corporate
      Secretary




*Subsequent
to December 31, 2008 Mary Pecoraro is no longer with the Company





Kyle
Kennedy


President,
Chief Executive Officer, Chairman of the Board





In 2001,
Mr. Kennedy co-founded Spartan Group Holdings, Inc., a group of companies
offering security sales and trading and investment banking services. In 2003,
Mr. Kennedy was also one of the founders of Island Stock Transfer, a securities
transfer and processing company with whom he is still associated. Prior
experience includes: August 1995 to Present – President of Kennedy and
Associates, Business Consultants; March 1998 to December 1998 – Vice President
Corporate Finance, Palm State Equities, Inc.; January 1999 to September 1999 –
Vice President Investment Banking, 1st American Investment Banking; September
1999 to May 2000 – President and Chief Executive Officer (“CEO”), Nowtrade Corp.
Mr. Kennedy is a senior financial executive, CEO, and President, with over 28
years experience in the brokerage business. He has held the following licenses:
Series 3,4,7,52,63, 24 and 55. He created, built and co-managed over $400
million in assets in money management with specific focus in equity analysis.
Mr. Kennedy’s public company experience includes his position as Executive Vice
President and ultimately, acting President, of a public holding company with
four diverse operations entities. He performed the day to day operations of the
company and management. He was directly responsible for the turnaround of this
complex, diverse holding company and successfully developed and implemented a
creditor workout plan negotiating with over 100 creditors, collection agencies,
and attorneys.





Christopher
Gilcher


Chief
Financial Officer





Mr.
Gilcher has worked with emerging growth companies in the areas of business and
strategic planning, corporate finance, and corporate development. Mr. Gilcher is
currently the President of Paladin Corporate Services, LLC, a company that
provides corporate financial consulting and business and strategic planning
services. Mr. Gilcher previously co-founded a technology transfer and
commercialization firm and was a director of the firm and the firm’s Chief
Financial Officer from 2005 to 2007. Mr. Gilcher holds an M.B.A. and a B.S. in
Finance from the University of South Florida





Pelle
Ojasu


Director





Pelle
Ojasu is an entrepreneur and an active investor. Mr. Ojasu has been the managing
member of Gateline, LLC since December of 2006. Gateline, LLC is a global
shipping and logistics company. Mr. Ojasu has also been the principal of
Speedwell Trade, Inc., a Swedish company, since January of 1997. Speedwell
Trade, Inc. is an export company to Europe.





Mary
Pecoraro


Corporate
Secretary





Mrs.
Pecoraro was the Administrative Officer/Executive Assistant for Renewable Energy
Resources, Inc. (formerly Internal Hydro International, Inc.), an alternative
energy company, since the inception of its predecessor company Internal Command
International, Inc., in January 2001. She was appointed Secretary to the company
by the Board of Directors in January 2006. She was responsible for the record
keeping and issuances of all stock transactions within the company. Mrs.
Pecoraro managed the financials on a daily basis and assisted in the budget
planning. She played an integral role in assisting the CEO and CFO with the
public filings of the company. Mrs. Pecoraro resigned as Secretary of Internal
Hydro International, Inc. in April 2007 when she and her husband opened Regent
Machine Products, Inc., a privately owned machine shop.





32





Item 10. Directors, Executive
Officers and Corporate Governance -  continued





Family
Relationships





There are
no family relationships among our officers and directors.





Director
Positions in Other Public Companies





No
director holds any directorship in a company with a class of securities
registered pursuant to Section 12 of the Securities Exchange Act of 1934 or
subject to the requirements of Section 15(d) of such Act. No director holds any
directorship in a company registered as an investment company under the
Investment Company Act of 1940.





Code
of Conduct





As the
Board of Directors only has two directors, no Audit or Strategy Committee has
been established. The Company does not have a standing nominating committee or
any committee performing a similar function. For the above reasons, the Company
has not adopted a code of ethics.




Item
11. Executive Compensation.




Not
applicable.




Summary
Compensation Table




Name
      and Principal Position
                        
                        Year
      End
                        
                        Salary
                          ($)
                        
                        Bonus
      ($)
                        
                        Stock
                          Awards
                          ($)
                        
                        Option
                          Awards
                          ($)
                        
                        Non-Equity
                          Incentive
                          Plan
                          Compen-sation
                          ($)
                        
                        Non-qualified
                          Deferred
      Compen-sation Earnings
                          ($)
                        
                        All
      Other Compen-sation
                          ($)
                        
                        Total
                          ($)Kyle
      Kennedy(1)
                        
                        
                        12/31/08
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        0
                        
                        
                        004/30/08
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        25,000
                        
                        
                        25,000Christopher
      Gilcher(2)
                        
                        
                        12/31/08
                        
                        
                        37,000
                        
                        
                        2,000
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        0
                        
                        
                        39,00004/30/08
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        0
                        
                        
                        0Pelle
      Ojasu(3)
                        
                        
                        12/31/08
                        
                        
                        —
                        
                        
                        —
                        
                        
                        240,000
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        20,000
                        
                        
                        260,00004/30/08
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        0
                        
                        
                        0Mary
      Pecoraro(4)*
                        
                        
                        12/31/08
                        
                        
                        19,741
                        
                        
                        500
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        0
                        
                        
                        20,24104/30/08
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        —
                        
                        
                        0
                        
                        
                        0


*Subsequent
to December 31, 2008 Mary Pecoraro is no longer with the Company.





33




Item
11. Executive Compensation - continued





(1)
            Mr.
      Kennedy does not receive a salary from the Company. The Company provided
      Mr. Kennedy with a one-time payment of $25,000 during the twelve month
      period ended April 30, 2008 for his efforts in the development and growth
      of the Company since its inception. The Company provides Mr. Kennedy with
      expense advances and Mr. Kennedy is reimbursed for expenses that he incurs
      on behalf of the Company.(2)
            In
      2008 the Company agreed to pay Mr. Gilcher a minimum of $5,000 per month
      plus expenses to perform duties as the Company’s Chief Financial Officer
      and Mr. Gilcher is reimbursed for expenses that he incurs on behalf of the
      Company.(3)
            For
      the period ending December 31, 2008 the Company paid Mr. Ojasu a payment
      of $20,000 and 12,000,000 restricted shares of the Company’s common stock
      for his efforts and involvement in the development and growth of the
      Company since its inception.(4)
            In
      2008 the Company verbally agreed to pay Ms. Pecoraro a fee of $3,800 per
      month to perform duties as the Company’s Corporate Secretary as well as to
      provide administrative, accounting and secretarial consulting
      services.


Executive
Compensation





All
compensation paid to executives for the period year ending December 31, 2008 is
reflected in the Summary Compensation Table.




Director
Compensation




The
Company does not have a formal compensation plan in place for its directors. All
compensation paid to directors for the period year ending December 31, 2008 is
reflected in the Summary Compensation Table.





Employment
Agreements




None.




Item
12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters.




The
following tables set forth certain information regarding beneficial ownership of
our capital stock as of the date hereof by (i) each person whom we know to
beneficially own more than five percent (5%) of any class of our common stock,
(ii) each of our directors, (iii) each of the executive officers and (iv) all
our directors and executive officers as a group. Unless otherwise indicated,
each of the persons listed below has sole voting and investment power with
respect to the shares beneficially owned.




Our total
authorized capital stock consists of 500,000,000 shares of common stock, $0.001
par value per share. As of December 31, 2008, there were 276,609,557 shares of
our common stock outstanding, all of which were fully paid, non-assessable and
entitled to vote. Each share of our common stock entitles its holder to one vote
on each matter submitted to our stockholders. As of December 31, 2008, there
were no shares of preferred stock issued and outstanding.





This
table reflects shares that were issued and outstanding as of December 31,
2008.




Name and Address of Beneficial
      Owner(1)
                  
                  
                  Shares
      of Common Stock
                    Beneficially
      Owned
                  
                  
                  Percentage
      of Common Shares
                    Beneficially
      Owned(2)Kyle
      Kennedy
                  
                  
                  37,035,000(3)
                  
                  
                  13.39%Pelle
      Ojasu
                  
                  
                  9,940,765(4)
                  
                  
                  3.59%Christopher
      Gilcher
                  
                  
                  0
                  
                  
                  0.00%Mary
      Pecoraro*
                  
                  
                  208,200
                  
                  
                  0.08%All
      directors and officers as a group (4 persons)
                  
                  
                  47,183,965
                  
                  
                  17.06%Credo
      Argentarius, LLC
                  
                  
                  34,700,000(3)
                  
                  
                  12.54%*Subsequent
      to December 31, 2008 Mary Pecoraro is no longer with the
      Company.(1)
                  Unless
      otherwise indicated, the address of each person listed below is c/o
      Seafarer Exploration Corp.(2)
                  Percentages
      are based on 276,609,557 shares of common stock outstanding at December
      31, 2008.






34




Item
12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters - continued




(3)
            For
      the purposes of this table the share amounts being shown as beneficially
      owned by Mr. Kennedy includes 34,700,000 shares legally owned by Credo
      Argentarius, LLC (“Credo”) even though Mr. Kennedy’s wife legally owns
      100% of Credo (Credo’s mailing address is 18829 Rue Loire, Lutz, FL
      33558),1,094,000
      shares legally owned by Mr. Kennedy’s daughter, 694,000 shares legally
      owned by Mr. Kennedy’s daughter, 347,000 shares legally owned by Mr.
      Kennedy’s father, and 200,000 shares legally owned by Mr. Kennedy’s
      daughter.(4)
            Consists
      of 8,305,920 shares owned by Pelle Ojasu. For the purposes of this table
      the share amounts being shown as beneficially owned by Mr. Ojasu also
      includes 1,434,845 shares legally owned by Mr. Ojasu’s brother, and
      200,000 shares legally owned by Mr. Ojasu’s daughter.




Item
13. Certain Relationships and Related Transactions, and Director
Independence.




On July
23, 2007 Seafarer entered into a convertible promissory note in the amount of
$15,000 with Pelle Ojasu, a director of the Company.   The note
is convertible to common stock at $0.10 per share, is secured by substantially
all the assets of the company and bears interest at a rate of 6%.  The
note was due September 30, 2008 but remains outstanding at December 31,
2008.





On
September 9, 2008 Seafarer entered into a promissory note agreement in the
amount of $9,000 with a person who is related to the CEO of the Company. The
note is not secured and bears interest at the rate of 8% per annum. The note is
interest only with interest payments to be made quarterly. The note is due and
payable on September 9, 2009.





On
September 29, 2008 Seafarer entered into a promissory note agreement in the
amount of $12,500 with a corporation. Seafarer’s CEO is a Director and a
co-founder of the corporation. The note is not secured and bears interest at the
rate of 8% per annum. The note is interest only with interest payments to be
made quarterly. The note is due and payable on September 29,
2009.





On
October 24, 2008 Seafarer entered into a promissory note agreement in the amount
of $6,500 with a person who is related to the CEO of the Company. The note is
not secured and bears interest at the rate of 8% per annum. The note is interest
only with interest payments to be made quarterly. The note is due and payable on
October 24, 2009. The principal amount of the note was repaid in December
2008.





On
October 27, 2008 Seafarer entered into a promissory note agreement in the amount
of $15,000 with a person who is related to the CEO of the Company. The note is
not secured and bears interest at the rate of 8% per annum. The note is interest
only with interest payments to be made quarterly. The note is due and payable on
October 27, 2009.





We did
not enter into any transactions with our directors and executive officers in
2008 other than as disclosed above and as of December 31, 2008 none are
proposed.





Item
14. Principal Accounting Fees and Services.


Audit
Related Fees




For the
Company’s fiscal year ended December 31, 2008 the Company paid fees of $31,500
for professional services rendered for the audit and review of our financial
statements.




Tax
Fees




For the
Company’s fiscal year ended December 31, 2008 the Company was not billed for
professional services rendered for tax compliance, tax advice, and tax
planning.




All
Other Fees




The
Company did not incur any other fees related to services rendered by our
principal accountant for the fiscal year ended December 31, 2008.











35





PART IV




Item
15. Exhibits





(2)
                      Plan
      of acquisition, reorganization, arrangement, liquidation or
      succession2.1
                      Form
      of Share Exchange Agreement dated June 4, 2008 by and among
      Organetix, Inc., Seafarer Exploration, Inc. and each of the shareholders
      of Seafarer Exploration incorporated by reference to Form 8-K filed with
      the Commission on June 10, 2008.(3)
                      Articles
      of Incorporation and By-laws3.1
                      Amended
      and Restated Certificate of Incorporation of Organetix, Inc. incorporated
      by reference to Organetix, Inc.’s Schedule 14C Definitive Information
      Statement filed with the Commission on May 6, 2008.3.2
                      Certificate
      of Amendment to the Certificate of Incorporation to merge Seafarer
      Exploration Corp., a wholly-owned subsidiary of the Company into the
      Company with the Secretary of State of the State of
      Delaware.  Pursuant to the Certificate of Amendment, the
      Company’s Articles of Incorporation were amended to change its name from
      Organetix, Inc. to Seafarer Exploration Corp. dated July 17, 2008,
      incorporated by reference to Form 8-K filed with the Commission on July
      24, 2008.(10)
                      Material
      Contracts10.1
                      Agreement
      by and between Tulco Resources, Ltd., and Seafarer Exploration, Inc. dated
      February 2007, incorporated by reference to Form 8-K filed with the
      Commission on June 10, 2008.10.2
                      Consulting
      Agreement by and between Chris Davis and Organetix, Inc. dated June 23,
      2008. Filed with this Form 10-K.10.3
                      Purchase
      and Sale Agreement by and between Sinclair Educational Archaeological
      Research Expeditions, Inc., Vanessa E. Friedman, James J. Sinclair and
      Seafarer Exploration, Inc. ("Buyer") dated July 2, 2008, incorporated by
      reference to Form 10-Q for the period ending September 30, 2008 filed with
      the Commission on November 14, 2008.10.4
                      Agreement
      Regarding Research and Recovery of Archaeological Material Between Florida
      Division of Historical Resources and Tulco Resources, Ltd. and Seafarer
      Exploration Corp. dated November 4, 2008. Filed with this Form
      10-K.10.5
                      Cancellation
      Agreement by and between Sinclair Educational Archaeological Research
      Expeditions, Inc., Vanessa E. Friedman, James J. Sinclair and Seafarer
      Exploration, Inc. dated December 9, 2008.  Filed with this Form
      10-K.10.6
                      Purchase
      and Sale Agreement by and between Sinclair Educational Archaeological
      Research Expeditions, and Seafarer Exploration, Inc. dated December 10,
      2008.  Filed with this 10-K.(31)
                      Section
      302 Certification31.1*
                      Rule 13a-14(a) Certification of Principal
      Executive Officer.31.2*
                      Rule 13a-14(a) Certification of Principal
      Financial Officer and Principal Accounting Officer.(32)
                      Section
      906
Certification


32.1*
                Certification of Principal Executive Officer
      Pursuant to 18 U.S.C. Section 1350, as Pursuant to Section 906 of
      theSarbanes-Oxley Act of
      2002.32.2*
                Certification of Principal Financial Officer and
      Principal Accounting Officer Pursuant to 18 U.S.C. Section 1350, asPursuant to Section 906 of the Sarbanes-Oxley Act
      of 2002.


36






















SIGNATURES




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




Seafarer
      Exploration Corp.Date:
      May 8, 2009
            By:
            /s/
      Kyle KennedyKyle
      Kennedy
              President,
      Chief Executive Officer, Chairman of the Board









































37