HPIL Holding 10Q 2009 Q0 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

o QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2008

o TRANSITION REPORT UNDER SECTION 13 or 15(d) OF THE EXCHANGE ACT

For the transition period from ___________ to _____________

Commission file number 000-29449

TNT DESIGNS, INC.

(Exact name of registrant as specified in its charter)

	Delaware		20-0937462
	(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

305 Madison Avenue

Suite 449

New York, NY 10165

(Address of principal executive offices)

	(917) 215-1222
	(Issuer's telephone number)

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

Indicate by check mark whether the registrant is a larger 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 ¨

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934) (check one): Yes oNo o

The numbers of shares outstanding of each of the issuer's classes of common equity, as of February 18, 2009, are as follows:

Class of Securities		Shares Outstanding
Common Stock, $0.001 par value		2,292,500

Transitional Small Business Disclosure Format (check one): Yes ¨ No ¨

TNT DESIGNS, INC.

	Page
ITEM 1 – Financial Information

Balance Sheets as of December 31, 2008 (Unaudited) and September 30, 2008	3

Statements of Operations for the Three Months Ended December 31, 2008 and 2007 and For the Period from February 17, 2004 (Inception) through December 31, 2008 (Unaudited)	4

Statement of Stockholders’ Equity (Deficit) For the Period from February 17, 2004 (Inception) through December 31, 2008 (Unaudited)	5

Statements of Cash Flows for the Three Months Ended December 31, 2008 and 2007 and For the Period from February 17, 2004 (Inception) through December 31, 2008 (Unaudited)	6

Notes to the Financial Statements (Unaudited)	7

Item 2 - Management’s Discussion and Analysis or Plan of Operation	10

Item 3 - Quantitative and Qualitative Disclosers about Market Risks.	12

Item 4T - Controls and Procedures	12

PART II - Other Information (Items 1-6)	12

SIGNATURES	14

ITEM 1 Financial Information

TNT DESIGNS, INC.

(A DEVELOPMENT STAGE COMPANY)

Balance Sheets

	December 31, 2008			September 30, 2008
	(Unaudited)
ASSETS

CURRENT ASSETS:
Cash	$	843		$	4,015
TOTAL CURRENT ASSETS	$	843		$	4,015

LIABILITIES AND STOCKHOLDERS’ DEFICIT

CURRENT LIABILITIES:
Accounts payable and accrued expenses	$	17,003		$	16,873
Due to stockholder/officer		70,481			70,481
Total Current Liabilities		87,484			87.354

STOCKHOLDERS’ DEFICIT:

Common stock at $0.0001 par value; 30,000,000 shares authorized; 2,292,500 shares issued and outstanding		229			229
Additional paid-in capital		29,221			29,221
Deficit accumulated during the development stage		(116,091	)		(112,789	)

Stockholders’ Deficit		(86,641	)		(83,339	)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	843		$	4,015

See accompanying notes to the financial statements.

TNT DESIGNS, INC.

(A DEVELOPMENT STAGE COMPANY)

Statements of Operations

(Unaudited)

	Three Months Ended December 31, 2008			Three Months Ended December 31, 2007			For the Period from February 17, 2004 (Inception) through December 31, 2008

Sales	$	-		$	-		$	42,021

Cost of sales		-			-			36,419

Gross profit		-			-			5,602

Operating expenses:
General and administrative		3,302			17,859			121,693

Total operating expenses		3,302			17,859			121,693

Loss before income taxes		(3,302	)		(17,859	)		(116,091	)

Income tax provision		-			-			-

Net loss	$	(3,302	)	$	(17,859	)	$	(116,091	)

Net loss per common share – basic and diluted	$	(0.00	)	$	(0.01	)	$	(0.05	)
Weighted average number of common shares outstanding – basic and diluted		2,292,500			2,292,500		$	2,252,137

See accompanying notes to the financial statements.

TNT DESIGNS, INC.

(A DEVELOPMENT STAGE COMPANY)

Statement of Stockholders’ Equity (Deficit)

For the Period from February 17, 2004 (Inception) through December 31, 2008

(Unaudited)

	Common Shares		Amount		Additional Paid-in Capital		Deficit Accumulated During the Development Stage			Total Stockholders’ Equity (Deficit)

Sale of common stock to officer, February 17, 2004 (Inception), at $0.0001 per share		2,000,000	$	200	$	-	$	-		$	200
Sale of common stock under private placement at $.10 per share, March to May 2004		100,000		10		9,990					10,000
Net loss								(2,407	)		(2,407	)
Balance, September 30, 2004		2,100,000		210		9,990		(2,407	)		7,793

Stock issued for services at $.10 per share, December 2004		100,000		10		9,990					10,000
Sale of common stock under private placement at $.10 per share, March 2005		92,500		9		9,241					9,250
Net loss								(25,365	)		(25,365	)
Balance, September 30, 2005		2,292,500		229		29,221		(27,772	)		1,678

Net loss								(31,416	)		(31,416	)
Balance, September 30, 2006		2,292,500		229		29,221		(59,188	)		(29,738	)

Net loss								(25,016	)		(25,016	)
Balance, September 30, 2007		2,292,500		229		29,221		(84,204	)		(54,754	)

Net loss								(28,585	)		(28,585	)
Balance, September 30, 2008		2,292,500		229		29,221		(112,789	)		(83,339	)

Net loss								(3,302	)		(3,302	)
Balance, December 31, 2008		2,292,500	$	229	$	29,221	$	(116,091	)	$	(86,641	)

See accompanying notes to the financial statements.

TNT DESIGNS, INC.

(A DEVELOPMENT STAGE COMPANY)

Statements of Cash Flows

(Unaudited)

	Three Months Ended December 31, 2008			Three Months Ended December 31, 2007			For the Period from February 17, 2004 (inception) through December 31, 2008

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(3,302	)	$	(17,859	)	$	(116,091	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Common stock issued for services								10,000
Changes in operating assets and liabilities:
Decrease in accounts receivable		-			21,804			-
Increase in accounts payable and accrued expenses		130			13,604			17,003
Net Cash Provided by (Used in) Operating Activities		(3,172	)		17,549			(89,088	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Sale of common stock		-			-			19,450
Increase in due to stockholder/officer		-			-			70,481
CASH FLOWS FROM FINANCING ACTIVITIES:		-			-			89,931

NET INCREASE (DECREASE) IN NET CASH		(3,172	)		17,549			843

CASH AT BEGINNING OF PERIOD		4,015			845			-
CASH AT END OF PERIOD	$	843		$	18,394		$	843

See accompanying notes to the financial statements.

TNT DESIGNS, INC.

(A DEVELOPMENT STAGE COMPANY)

FOR THE PERIOD FROM FEBRUARY 17, 2004 (INCEPTION) THROUGH DECEMBER 31, 2008

NOTES TO THE FINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1 - NATURE OF OPERATIONS

TNT Designs, Inc. (a development stage company) (“TNT” or the “Company”) was incorporated on February 17, 2004 under the laws of the State of Delaware. A substantial portion of the Company’s activities has involved developing a business plan and establishing contacts and visibility in the marketplace and the Company has generated minimal revenue to date. TNT markets and distributes scarves, handbags and other products from India.

NOTE 2 - SUMMARY OF ACCOUNTING POLICIES

Basis of Presentation

The accompanying interim financial statements for the three month period ended December 31, 2008 and 2007 and for the period February 17, 2004 (Inception) through December 31, 2008 are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results of operations realized during an interim period are not necessarily indicative of results to be expected for a full year. These financial statements should be read in conjunction with the information filed as part of the Company’s Annual Report on Form 10-K which was filed on February 5, 2009.

Development stage company

The Company is a development stage company as defined by Statement of Financial Accounting Standards No. 7“Accountingand Reporting by Development Stage Enterprises” (“SFAS No. 7”). The Company is still devoting substantially all of its efforts on establishing the business and its planned principal operations have not commenced. All losses accumulated since inception have been considered as part of the Company’s development stage activities.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported amount of revenues and expenses during the reporting period. Actual results could differ from these estimates.

Cash Equivalents

The Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents.

Fair value of financial instruments

The fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties. The carrying amounts of financial assets and liabilities, such as cash, accounts payable and accrued expenses, approximate their fair values because of the short maturity of these instruments.

Revenue recognition

The Company’s revenues will be derived principally from the marketing and distribution scarves, handbags and other products from India. The Company follows the guidance of the Securities and Exchange Commission’s Staff Accounting Bulletin 104 (“SAB No. 104”) for revenue recognition. The Company recognize revenues when it is realized or realizable and earned less estimated future doubtful accounts. The Company considers revenue realized or realizable and earned when it has persuasive evidence of an arrangement that the product has been shipped, the sales price is fixed or determinable, and collectability is reasonably assured.

Net loss per common share

Net loss per common share is computed pursuant to Statement of Financial Accounting Standards No. 128. "Earnings per Share" ("SFAS No. 128"). Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during each period. There were no potentially dilutive shares outstanding as of December 31, 2008 or 2007.

Recently Issued Accounting Pronouncements

In June 2003, the Securities and Exchange Commission (“SEC”) adopted final rules under Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”), as amended by SEC Release No. 33-8934 on June 26, 2008. Commencing with its annual report for the fiscal year ending September 30, 2010, the Company will be required to include a report of management on its internal control over financial reporting. The internal control report must include a statement

·	of management’s responsibility for establishing and maintaining adequate internal control over its financial reporting;

·	of management’s assessment of the effectiveness of its internal control over financial reporting as of year end; and

·	of the framework used by management to evaluate the effectiveness of the Company’s internal control over financial reporting.

Furthermore, in the following fiscal year, it is required to file the auditor’s attestation report separately on the Company’s internal control over financial reporting on whether it believes that the Company has maintained, in all material respects, effective internal control over financial reporting.

In December 2007, the FASB issued FASB Statement No. 141 (Revised 2007) “Business Combinations” (“SFAS No. 141(R)”), which requires the Company to record fair value estimates of contingent consideration and certain other potential liabilities during the original purchase price allocation, expense acquisition costs as incurred and does not permit certain restructuring activities previously allowed under Emerging Issues Task Force Issue No. 95-3 to be recorded as a component of purchase accounting. SFAS No. 141(R) applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008, except for the presentation and disclosure requirements, which shall be applied retrospectively for all periods presented. The Company has not determined the effect that the adoption of SFAS No. 141(R) will have on the financial results of the Company.

In December 2007, the FASB issued FASB Statement No. 160 “Noncontrolling Interests in Consolidated Financial Statements - an amendment of ARB No. 51” (“SFAS No. 160”), which causes noncontrolling interests in subsidiaries to be included in the equity section of the balance sheet. SFAS No. 160 applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008, except for the presentation and disclosure requirements, which shall be applied retrospectively for all periods presented. The Company will adopt this standard at the beginning of the Company’s fiscal year ending December 31, 2008 for all prospective business acquisitions. The Company has not determined the effect that the adoption of SFAS No. 160 will have on the financial results of the Company.

In March 2008, the FASB issued FASB Statement No. 161 “Disclosures about Derivative Instruments and Hedging Activities an amendment of FASB Statement No. 133” (“SFAS No. 161”), which changes the disclosure requirements for derivative instruments and hedging activities. Pursuant to SFAS No.161, Entities are required to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. SFAS No. 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008 with early application encouraged. SFAS No. 161 encourages but does not require disclosures for earlier periods presented for comparative purposes at initial adoption. In years after initial adoption, this Statement requires comparative disclosures only for periods subsequent to initial adoption. The Company does not expect the adoption of SFAS No. 161 to have a material impact on the financial results of the Company.

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements.

NOTE 3 - GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As reflected in the accompanying financial statements, the Company had a deficit accumulated during the development stage of $116,091 and a net loss of $3,302 for the three months ended December 31, 2008. These conditions raise substantial doubt about its ability to continue as a going concern.

While the Company is attempting to produce sufficient sales, the Company’s cash position may not be sufficient to support the Company’s daily operations. While the Company believes in the viability of its strategy to produce sales volume and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and generate sufficient revenues. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern.

ITEM 2

MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Information set forth herein contains "forward-looking statements" which can be identified by the use of forward-looking terminology such as "believes," "expects," "may,” “should" or "anticipates" or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy. No assurance can be given that the future results covered by the forward-looking statements will be achieved. The Company cautions readers that important factors may affect the Company’s actual results and could cause such results to differ materially from forward-looking statements made by or on behalf of the Company. These factors include the Company’s lack of historically profitable operations, dependence on key personnel, the success of the Company’s business, ability to manage anticipated growth and other factors identified in the Company's filings with the Securities and Exchange Commission, press releases and/or other public communications.

Plan of Operations

TNT Designs, Inc. (“TNT” or the “Company”) was incorporated pursuant to the laws of Delaware on February 17, 2004. TNT entered into its first strategic alliance and distribution agreement with Radico Export Import, Ltd., a corporation formed under the laws of India. This agreement provides TNT with an exclusive right to market and distribute Radico’s products in New York State. TNT intends to negotiate an expansion of the geographic scope of this agreement with Radico such that the exclusivity extends throughout the United States, or worldwide. However, TNT's current agreement with Radico makes no provision for expanding TNT's exclusivity, nor has any agreement with Radico, written or oral, been reached and no assurance can be given that any such agreement will be reached. TNT also intends to enter into additional exclusive distribution arrangements with other similarly situated companies located in India. The company continues to be in the process of negotiating such an agreement with a manufacturer of goods located in India.

TNTs’ plan of operation for the next twelve (12) months is to market and distribute the products supplied by Radico and other manufacturers and wholesalers to the potential customers on our mailing lists and databases and by the use of the web site, which is expected to be completed in the near future. If TNT is unable to raise necessary funds for working capital, TNT will be unable to effectively market its products. TNT intends to market its products via its website and its Ebay store as well as, if funding or revenues permit, direct selling to retail and wholesale customers through tradeshows, trunk shows and TNT’s network of contacts. TNT will commence a web site marketing program in the near future, which will attempt to steer customers to its web site. It is anticipated that the average cost to conduct a trunk show for our products will be approximately $5,000, which includes the costs for transportation, rental space, inventory, staffing and marketing and printing costs. It is anticipated that the average cost to participate in an industry tradeshow will be $15,000, which includes the costs for transportation, booth rental, inventory, staffing and marketing and printing costs. There can be no assurance that TNT will have raised sufficient funds or generate sufficient revenues for either trunk shows or trade-shows.

TNT does not plan to conduct any product research and development, purchase any significant equipment or increase the number of employees in the next twelve (12) months. TNT will focus its efforts on sales and marketing of products. In addition, TNT will attempt to expand its base of customers as well as suppliers in India. Currently, TNT relies primarily on its alliance agreement with Radico to meet all of TNT’s sales requirements. TNT intends to seek out and find additional suppliers of new and similar products to those supplied by Radico.

At December 31, 2008, TNT’s cash position was approximately $800. At its current rate of expenditures, TNT will only have cash available to maintain operations for approximately three (3) months. TNT may also seek to obtain short-term loans from its director, although no such arrangement has been made. TNT does not have any arrangements in place for any future equity financing. TNT’s current cash requirements will be met by cash on hand and, if working capital funds are not available, TNT will suspend or limit business operations. As discussed in our audited financial statements as of September 30, 2008, our auditors expressed substantial doubt about our ability to continue as a “going concern”.

Our continued operations will depend on whether we are able to raise additional funds through various potential sources, such as equity and debt financing, and strategic alliances. Such additional funds may not become available on acceptable terms, if at all, and there can be no assurance that any additional funding that we do obtain will be sufficient to meet our needs in the long term. Through December 31, 2008, virtually all of our financing has been through private placements of common stock and loans by our executive officer. We intend to continue to fund operations from cash on-hand and through the similar sources of capital previously described for the foreseeable future. We can give no assurances that any additional capital that we are able to obtain will be sufficient to meet our needs. We believe that we will continue to incur net losses and negative cash flows from operating activities for the foreseeable future. Based on the resources available to us at December 31, 2008, we will need additional equity or debt financing to sustain our operations through 2009 and we will need additional financing thereafter until we can achieve profitability, if ever. These matters raise substantial doubt about our ability to continue as a going concern.

Liquidity and Capital Resources

Based upon our current rate of expenditure, we will only have cash available to maintain purchases for approximately three (3) months. We may seek to obtain short-term financing from our sole officer and director, who has met our financing needs in the past. However, no such arrangements for funding or other future financing currently exists. The Company may seek to raise capital through an offering of our common stock. However, there can be no assurance that we will be successful in securing the capital we require or that we may obtain financing on terms that are favorable to us.

Off Balance Sheet Transactions

There are no off-balance sheet arrangements to which the Company is a party that have or are reasonably likely to have a current or future effect on the Company's financial condition, results of operations, cash flows, liquidity, capital expenditures or capital resources.

Recently Issued Accounting Pronouncements

·	of management’s responsibility for establishing and maintaining adequate internal control over its financial reporting;

·	of management’s assessment of the effectiveness of its internal control over financial reporting as of year end; and

·	of the framework used by management to evaluate the effectiveness of the Company’s internal control over financial reporting.

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements.

Critical Accounting Policies

The preparation of financial statements and related notes requires us to make judgments, estimates, and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities.

An accounting policy is considered to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the financial statements.

Financial Reporting Release No. 60 requires all companies to include a discussion of critical accounting policies or methods used in the preparation of financial statements. There are no critical policies or decisions that rely on judgments that are based on assumptions about matters that are highly uncertain at the time the estimate is made.

Seasonality

To date, we have not noted any significant seasonal impacts.

ITEM 3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Applicable.

ITEM 4T. - CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures.

We maintain disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) that are designed to assure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. As required by Exchange Act Rule 13a-15(b), as of the end of the period covered by this report, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of our disclosure controls and procedures. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of that date.

b) Changes in internal control over financial reporting.

There was no change in our internal control over financial reporting during our most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

Item 1. - Legal Proceedings

None.

Item 2. - Changes in Securities and Use of Proceeds

Not applicable.

Item 3. - Defaults Upon Senior Securities

Not applicable.

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

Not applicable.

Item 5. - Other Information

Not applicable

Item 6. - Exhibits and Reports on Form 8-K

Exhibits.

31.1		Section 302 Certification Of Chief Executive and Chief Financial Officer

32.1		Certification of Chief Executive Officer and Chief Financial Officer Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 Of The Sarbanes-Oxley Act Of 2002

Reports on Form 8-K

Not applicable

SIGNATURES

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

	TNT DESIGNS, INC.

	/s/ Anju Tandon
	Name:	Anju Tandon
	Title:	President and Chief Executive
		Officer and Director (Principal Executive, Financial and Accounting Officer)

	Date:	February 18, 2009

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HPIL Holding (HPIL) 10-Q2009 Q0 Quarterly report

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