UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

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 FORM 10-Q

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

 

For the quarterly period ended March 31, 2015

 

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934

 

For the transition period from _____to _____

 

Commission File Number 000-53976

HW HOLDINGS, INC. (F.K.A. HORIYOSHI WORLDWIDE, INC.)
(Exact name of registrant as specified in its charter)

Nevada	98-0513655
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)
506 S. Spring Street #13575	90013
(Address of principal executive offices)	(Zip Code)

 

(213) 741-1920
(Registrant’s telephone number, including area code)

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     ☐ No

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☒Yes     ☐ No

 

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.

 

Large accelerated filer ☐		Accelerated  filer ☐
Non-accelerated filer ☐  (Do not check if a smaller reporting company)		Smaller reporting company ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  

☐ Yes  ☒ No

As of May 19, 2015, there were 58,202,278 shares of the registrant’s $0.001 par value common stock issued and outstanding.

 

HW HOLDINGS, INC. (F.K.A. HORIYOSHI WORLDWIDE, INC.)

TABLE OF CONTENTS

PART 1 - FINANCIAL INFORMATION
Item 1.	Condensed Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	6
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	9
Item 4.	Controls and Procedures	9
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	10
Item 1A.	Risk Factors	10
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	10
Item 3.	Defaults Upon Senior Securities	10
Item 4.	Mine Safety Disclosures	10
Item 5.	Other Information	10
Item 6.	Exhibits	10

  

Special Note Regarding Forward-Looking Statements

 

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of HW Holdings, Inc.,(the “Company”), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

 

*Please note that throughout this Quarterly Report, and unless otherwise noted, the words "we," "our," "us," the "Company," or "HHWW" refers to HW Holdings, Inc.

 

PART I- FINANCIAL INFORMATION

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the audited financial statements as of December 31, 2014 and notes thereto contained in our Company's Form 10-K filed with the SEC on April 8, 2015. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year ending December 31, 2014.

ITEM 1.

CONDENSED FINANCIAL STATEMENTS

 

INDEX	F-1
Condensed Consolidated Balance Sheet (unaudited) as of March 31, 2015 and December 31, 2014.	F-2
Condensed Consolidated Statement of Operations and Comprehensive Loss (Unaudited) for the Three Months Ended March 31, 2015 and 2014.	F-3
Condensed Consolidated Statement of Cash Flows (unaudited) for the Three Months Ended March 31, 2015 and 2014.	F-4
Notes  to Condensed Consolidated Financial Statements Unaudited	F-5

 

 

HW HOLDINGS INC. (F.K.A. HORIYOSHI WORLDWIDE, INC.)

CONDENSED CONSOLIDATED BALANCE SHEET

(UNAUDITED)

		March 31,				December 31,
		2015				2014
ASSETS
Current assets:
Cash and cash equivalents		$	3,169			$	7,140
Accounts receivable (net)			933				946
Prepaid expenses and other assets			6,858				29,848
Inventory			59,247				61,060
Total current assets			70,207				98,994
Property and equipment, net			30,568				33,351
Total assets		$	100,775			$	132,345
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable		$	292,127			$	321,867
Deferred Revenue			9,024				8,980
Accrued expenses			923,333				916,156
Due to shareholders			105,138				93,138
Demand loan			150,000				150,000
Related party, demand loan			1,634,478				1,626,978
Total current liabilities			3,114,100				3,117,119
Total liabilities		$	3,114,100			$	3,117,119
Stockholders’ Deficit:
Preferred stock, par value $0.001, 100,000,000 shares authorized, none issued and outstanding
Common stock, par value $0.001, 1,081,100,000 shares authorized, 56,202,278 shares issued and outstanding as of March 31, 2015 and December 31, 2014			56,202				51,202
Additional Paid-in Capital			6,742,480				6,697,480
Accumulated other comprehensive income			69,502				19,334
Accumulated deficit			(9,881,509	)			(9,752,790	)
Total stockholders' deficit			(3,013,325	)			(2,984,774	)
Total liabilities and stockholders' deficit		$	100,775			$	132,345

  

The accompanying notes are an integral part of the condensed consolidated unaudited financial statements.

HW HOLDINGS, INC. (F.K.A. HORIYOSHI WORLDWIDE, INC.)

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

(UNAUDITED)

		For the three months ended
		March 31,				March 31,
		2015				2014
Revenue, net		$	3.456			$	106,795
Cost of sales			1,813				56,599
Gross profit		$	1,643			$	50,196
Operating Expenses
Selling expenses			330				10,487
General and administrative expenses			72,362				276,066
Depreciation			2.784				6,729
Total operating expenses		$	75,476			$	293,282
Loss from operations			(73,833	)			(243,086	)
Non-operating income (expenses)
Other income			150
Loss on early lease termination			(6,605	)
Foreign currency transaction gain/(loss)			(46,325	)			9,822
Net loss before interest and taxes			(126,613	)			(233,264	)
Interest expense			2,106				15,994
Net loss before income taxes			(128,719	)			(249,258	)
Income taxes			—				—
Net loss		$	(128,719	)		$	(249,258	)
Foreign currency translation adjustment			50,168				(8,601	)
Comprehensive loss		$	(78,551	)		$	(257,859	)
Earnings (loss) per share of common stock		$	(0.00	)		$	(0.32	)
Weighted average shares of common  stock outstanding			52,898,945				810,180

  

The accompanying notes are an integral part of the condensed consolidated unaudited financial statements.

HW HOLDINGS, INC. (F.K.A. HORIYOSHI WORLDWIDE, INC.)

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(UNAUDITED)

		For the three months ended
		March 31,				March 31,
		2015				2014
Cash flows from operating activities
Net loss		$	(128,719	)		$	(249,258	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation			2,784				6,729
Allowance for doubtful accounts			—				(501	)
Changes in operating assets and liabilities:
Accounts receivable			—				12,307
Prepaid expenses and other assets			22,477				(14,574	)
Inventory			1,813				34,775
Accounts payable			(29,126	)			(31,493	)
Deferred revenue			44				632
Accrued expenses			11,154				116,212
Net cash used in operating activities			(119,573	)			(125,171	)
Cash flows from financing activities
Proceeds from loans from shareholders			12,000				—
Repayment of loans from shareholders			—				(500	)
Proceeds from related party demand loans			7,500				152,090
Repayment of related party demand loans			—				(17,000	)
Proceeds from the sale of common stock			50,000				—
Net cash provided by financing activities:			69,500				134,590
Effect of foreign currency translation on cash and cash equivalents			46,102				42
Net increase (decrease) in cash			(3,971	)			9,461
Cash - beginning of period			7,140				11,728
Cash - end of period		$	3,169			$	21,189

 

The accompanying notes are an integral part of the condensed consolidated unaudited financial statements.

 

HW HOLDINGS, INC. (F.K.A. HORIYOSHI WORLDWIDE, INC.)

NOTES TO CONDENSED CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS

Note 1. Organization and Business

HW Holdings, Inc. (HHWW) owns and operates “HTT Clothing”, a luxury contemporary clothing brand engaged in the design, distribution, and retailing of apparel based on the creative inspiration of sophisticated tattoo art.

The business was established on September 1, 2008 to capitalize on the legacy of the tattoo master Horiyoshi III, by offering consumers a unique collection of knitwear, t-shirts and accessory items based on his designs. The Company began selling its products from the “Horiyoshi” collection in 2009 and later developed the “Heroes & Demons” collection in 2011 and “The Thiiird” collection in 2012. The rights to the design catalogue were exclusively licensed to Horiyoshi the Third Limited, a wholly owned subsidiary of HHWW (“the Company”). Horiyoshi Worldwide [U.K.] Limited, another subsidiary wholly owned by HHWW, was created in 2011 to operate the Company’s first branded retail outlet in London.

In order to broaden its scale and scope, the Company established the brand “HTT Clothing” in 2014. The “HTT Clothing” collection infuses its designs with artwork and themes from various renowned tattoo artists to create a broad and varied style while maintaining the Company’s dedication to craftsmanship and quality goods.

Going Concern, Liquidity and Management's Plan

As of March 31, 2015 our Company has accumulated losses of $9,881,509 since inception and has earned no net income since inception. Our Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the year ending December 31, 2015. In response to these problems, management intends to raise additional funds through public or private placement offerings. These factors, among others, raise substantial doubt about our company’s ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Note 2. Summary of Significant Accounting Policies

Principles of Consolidation and Basis of Presentation

The unaudited consolidated financial statements include the accounts of HW Holdings, Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated upon consolidation.

The accompanying unaudited HW Holdings, Inc. consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and are presented in accordance with the requirements of Form 10-Q and Article 8 of Regulation S-X. Accordingly, these unaudited consolidated financial statements do not include all of the information and notes required by GAAP for complete financial statements and should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended December 31, 2014 included in the Company's Annual Report on Form 10-K. In the opinion of management, the interim unaudited consolidated financial statements included herein contain all adjustments, including normal recurring adjustments, considered necessary to present fairly the Company's financial position, the results of operations and cash flows for the periods presented.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. The most significant estimates include: revenue recognition; sales returns and other allowances; allowance for doubtful accounts; valuation of inventory; valuation and recoverability of long-lived assets; property and equipment; contingencies; and income taxes.

On a regular basis, management reviews its estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such reviews, and if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates.

Fair Value of Financial Instruments

The carrying amount reported in the accompanying consolidated balance sheets for cash, accounts receivable, inventory, accounts payable and accrued expenses approximates fair value because of the short-term maturity of those instruments. It was not practicable to estimate the fair value of notes payable to related parties.

Segment reporting

The Company considers its operations to constitute a single segment which is the design and distribution of clothes and accessories. The Company does not operate under a multiple segment reporting model.

Note 3. Related Party Transactions

As of March 31, 2015 and December 31, 2014, our Company was obligated to Steve Suk, a Director of Horiyoshi the Third Limited, for a non-interest bearing demand loan with a balance of $105,138 and $93,138, respectively. This amount is included on the balance sheet under “Due to shareholders”.

As of March 31, 2015 and December 31, 2014, our Company was obligated to Lone Star Capital Limited, for a non-interest bearing demand loan with a balance of $1,634,478 and $1,626,978, respectively. This amount is included on the balance sheet under “Related party, demand loan”.

On August 30, 2012, our Company entered into a credit facility agreement with AMS Holdings Limited. The credit facility has an aggregate principal amount of $300,000 and can be drawn on at any time. Any amounts outstanding are due on the demand of the lender and are non-interest bearing. As of March 31, 2015 and December 31, 2014, our Company was obligated to AMS Holdings Limited for $150,000. This amount is included on the balance sheet under “Demand loans”.

Note 4. Capital Transactions

On April 5, 2015 the Company entered into subscription agreements with two investors for the issuance of 5,000,000 shares of common stock at a price of $0.01 per share. This transaction increased the number of shares issued and outstanding to 56,202,278.

 

Note 5. Subsequent Events

On May 19, 2015 the Company entered into a subscription agreement with Capital Rely Limited for the issuance of 2,000,000 shares of common stock at a price of $0.01 per share. This transaction increased the number of shares issued and outstanding to 58,202,278.

 

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our consolidated financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward looking statements. Factors that could cause or contribute to such differences include, but are not limited to those discussed below and elsewhere in this quarterly report.

Our consolidated financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.

Overview

HW Holdings, Inc. (HHWW) owns and operates “HTT Clothing”, a luxury contemporary clothing brand engaged in the design, distribution, and retailing of apparel based on the creative inspiration of sophisticated tattoo art.

The business was established on September 1, 2008 to capitalize on the legacy of the tattoo master Horiyoshi III, by offering consumers a unique collection of knitwear, t-shirts and accessory items based on his designs. The Company began selling its products from the “Horiyoshi” collection in 2009 and later developed the “Heroes & Demons” collection in 2011 and “The Thiiird” collection in 2012. The rights to the design catalogue were exclusively licensed to Horiyoshi the Third Limited, a wholly owned subsidiary of HHWW (“the Company”). Horiyoshi Worldwide [U.K.] Limited, another subsidiary wholly owned by HHWW, was created in 2011 to operate the Company’s first branded retail outlet in London.

In order to broaden its scale and scope, the Company established the brand “HTT Clothing” in 2014. The “HTT Clothing” collection infuses its designs with artwork and themes from various renowned tattoo artists to create a broad and varied style while maintaining the Company’s dedication to craftsmanship and quality goods.

The Company is passionate about the art work of each collaborative tattoo artist and takes great care integrating imagery into each of its garments. HHWW’s management feels that it is positioning the Company to take advantage of the increasing inflection of design, art and culture in today’s fashion world. By introducing quality clothes that infuse the internationally recognized art work of renowned tattoo artists, the Company believes it is at the vanguard of a growing interest in unique aspects of the art and cultural imagery. Our goal is to build a brand that is recognized throughout the world for creating quality products with universal appeal.

Results of Operations

The following summary of our results of operations should be read in conjunction with our consolidated financial statements for the three months ended March 31, 2015 and 2014.

Operating results for the three months ended March 31, 2015 and 2014 are summarized below:

		Three Months Ended March 31, 2015				Three Months Ended March 31, 2014
Revenue		$	3,456			$	106,795
Cost of sales			1,813				56,599
Gross Profit			1,643				50,196
Expenses			75,476				293,282
Other income (expense)			(52,780	)			9,822
Interest expense			2,106				15,994
Net Loss		$	(128,719	)		$	(249,258	)

Revenue

We earned revenues of $3,456 for the three months ended March 31, 2015 compared to revenues of $106,795 for the three months March 31, 2014. Revenues decreased as a result of reduced web sales as well as the closure of our branded retail outlet.

 

Cost of Goods Sold

 

Cost of goods sold for the three months ended March 31, 2015 were $1,813 compared to $56,599 for the three months ended March 31, 2014. Cost of goods sold represented 52% of sales for the three months ended March 31, 2015 as compared to 53% for the three months ended March 31, 2014. The slight decrease in cost of goods sold as a percentage of sales for the three month period ended March 31, 2015 can be attributed to the sale of old season inventory where reserves had already been accounted for in prior quarters.

 

Expenses

Our total expenses for the three months ended March 31, 2015 and 2014 are outlined in the table below:

		Three Months Ended March 31, 2015				Three Months Ended March 31, 2014
Selling		$	330			$	10,487
General and administrative			72,362				276,066
Depreciation			2,784				6,729
Total expenses		$	75,476			$	293,282

 

For the three months ended March 31, 2015 expenses decreased $217,806, or 74%, to $75,476 as compared to $293,282 for the corresponding period in 2014. This decrease can be attributed to the closure of our branded retail store which led to significant decreases in rent, salaries, and office expenses.

Liquidity and Financial Condition

Working Capital
		At March 31, 2015				At December 31, 2014				Change
Current Assets		$	70,207			$	98,994			$	(28,787	)
Current Liabilities		$	3,114,100			$	3,117,119			$	3,019
Working Capital		$	(3,043,893	)		$	(3,018,125	)		$	(25,768	)

 

 

Cash Flows
		Three Months Ended March 31, 2015				Three Months Ended March 31, 2014
Net Cash Used in Operating Activities		$	(119,573	)		$	(125,171	)
Net Cash Provided by Investing Activities		$	—			$	—
Net Cash Provided by Financing Activities		$	69,500			$	134,590
Net Effect of Foreign Currency Translation		$	46,102			$	42
Net Increase (Decrease) in Cash During the Period		$	(3,971	)		$	9,461

For the three months ended March 31, 2015, net cash used in operating activities was $119,573 as a result of changes in our working capital and a three month net loss of $128,719.

For the three months ended March 31, 2015, net cash provided by financing activities was $69,500 as a result of proceeds of loans from shareholders and related parties, as well as proceeds from the sale of common stock.

We will require additional funds to fund our budgeted expenses in the future. These funds may be raised through equity financing, debt financing, or other sources, which may result in further dilution in the equity ownership of our shares. There is no assurance that we will be able to maintain operations at a level sufficient for an investor to obtain a return on their investment in our common stock. Further, we may continue to be unprofitable. We may need to raise additional funds in the future in order to proceed with our budgeted expenses. Additionally, there is no assurance that any party will advance additional funds to us in order to enable us to sustain our plan of operations or to repay our liabilities.

Liquidity and Capital Resources

Growth of our operations will be based on our ability to internally finance from cash flow, raise equity and/or debt to increase sales and production. Our primary sources of liquidity are: (i) cash from sales of our products; and (ii) financing activities. Our cash balance as of March 31, 2015 is $3,456.

Prior to the $5,000,000 in equity financing in December 2010, our Company funded some of its operations through debt financing with related party transactions.

As of March 31, 2015, our Company was obligated to Steve Suk, a Director of Horiyoshi the Third Limited, for a non-interest bearing demand loan with a balance of $105,138.

As of March 31, 2015, our Company was obligated to Lone Star Capital Limited, a related party, for a non-interest bearing demand loan with a balance of $1,634,478.

As of March 31, 2015, our Company was obligated to AMS Holdings Limited, for a non-interest bearing demand loan with a balance of $150,000.

Plan of Operation and Cash Requirements

Our wholly-owned subsidiary, Horiyoshi the Third Limited, began selling its products in 2009. Our wholly owned subsidiary Horiyoshi Worldwide [U.K.] Limited, began operating our first branded retail outlet in London in 2011. Our plan of action over the next twelve months is to continue to market and sell the “HTT Clothing” collection and raise additional capital financing as necessary, to grow operations.

The success of our operations will be based on our ability to grow by financing the operation through internal cash flow or to raise funds through equity and/or debt financing to invest in marketing, sales and distribution of our product line. The challenging markets for credit and for the sale of luxury apparel resulting from the recent financial crisis and current period of economic stagnation have negatively affected the markets for many luxury goods. The availability of equity and/or debt financings remains uncertain.

 

Going Concern

For the three months ended March 31, 2015, our Company incurred a loss of $128,719 and an accumulated deficit of $9,881,509. Our Company intends to fund operations through operational cash flow and equity/debt financing arrangements. These sources may be insufficient to fund its capital expenditures, working capital and other cash requirements for the future. In response to these problems, management intends to raise additional funds through public or private placement offerings. These factors, among others, raise substantial doubt about our Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

Critical Accounting Policies

Use of estimates

In preparing financial statements in conformity with US GAAP, our management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities. These estimates and assumptions also affect the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the reported periods. Actual results could differ from those estimates.

Our consolidated financial statements include some amounts that are based on our management's best estimates and judgments. The most significant estimates relate to the valuation allowance for accounts receivable, returns, inventory, deferred taxes and various contingent liabilities. It is reasonably possible that the above-mentioned estimates and others may be adjusted as more current information becomes available, and any adjustment could be significant in future reporting periods.

Revenue recognition

Our revenue recognition policy is in accordance with generally accepted accounting principles, which requires the recognition of sales when there is evidence of a sales agreement, the delivery of goods has occurred, the sales price is fixed or determinable and the collectability of revenue is reasonably assured. We record sales upon shipment of product to customers and transfer of title under standard commercial terms for wholesale and web orders, and at the point of sale for direct to consumer sales at our branded retail store.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

Item 4. Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, 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 our management, including our president and chief executive officer (our principal executive officer) and our chief financial officer (our principal financial officer and principal accounting officer), to allow for timely decisions regarding required disclosure.

As of the end of the fiscal quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president and chief executive officer (our principal executive officer) and our chief financial officer (our principal financial officer and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president and chief executive officer (our principal executive officer) and our chief financial officer (our principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures were ineffective as of the end of the period covered by this quarterly report.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the three months ended March 31, 2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 1A. Risk Factors.

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

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

None.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

 

Item 6. Exhibits

  

Exhibit Number	Description
(3)	(i) Articles of Incorporation and (ii) Bylaws
3.1	Certificate of Amendment filed with the Nevada Secretary of State on June 17, 2010, effective June 21, 2010. (Incorporated by reference from our Current Report on Form 8-K filed on July 20, 2010).
3.2	Bylaws  (Incorporated by reference from exhibit 3.2 of our Registration Statement on Form SB-2 filed on April 13, 2007).
3.3	Amendment to the Articles of Incorporation of Registrant as filed with the Nevada Secretary of State on April 30, 2009 (Incorporated by reference from exhibit 3.1 of our Current Report on Form 8-K filed on May 8, 2009).
(10)	Material Contracts
10.1	License Agreement dated September 17, 2008 between Horiyoshi III Worldwide Ltd. and Stone Corporation Inc. (Incorporated by reference from our Current Report on Form 8-K filed on November 8, 2010).
10.2	Share Exchange Agreement among the company, Horiyoshi the Third Limited and the Shareholders of Horiyoshi the Third Limited dated September 1, 2010. (Incorporated by reference from our Current Report on Form 8-K filed on September 3, 2010).
10.3	Amendment to Share Exchange Agreement dated November 5, 2010 with Horiyoshi the Third Limited. (Incorporated by reference from our Current Report on Form 8-K filed on November 8, 2010).
10.4	Share Cancellation Agreement dated November 5, 2010 with Mitsuo Kojima. (Incorporated by reference from our Current Report on Form 8-K filed on November 8, 2010).
10.5	Share Issuance Agreement dated November 29, 2010 with Zyndy Trade Corp.
10.6	Consulting Agreement dated January 1, 2011 with Raymond A. Catroppa (Incorporated by reference from our Current Report on Form 8-K filed on February 28, 2011).
10.7	License Agreement dated June 1, 2011 between Horiyoshi The Third Limited and Stone Corporation Inc.
10.8	Agreement For Settlement of Prepaid Assets and Forgiveness of Debt dated June 30, 2011 between Horiyoshi The Third Limited, Lonestar Capital Limited, and Stone Corporation Inc.
(14)	Code of Ethics
14.1	Code of Ethics (Incorporate by reference from exhibit 14 of  our Annual Report on Form 10-KSB filed on March 26, 2008
(21)	Subsidiaries of the Registrant
21.1	Horiyoshi the Third Limited
(31)	Rule 13a-14(a)/15d-14(a) Certifications
31.1	Section 302 Certification under the Sarbanes-Oxley Act of 2002 of the Principal Executive Officer
31.2	Certification of Acting Chief Financial Officer
(32)	Section 1350 Certifications
32.1	Section 906 Certification under the Sarbanes-Oxley Act of 2002 of the Principal Executive Officer.
32.2	Section 906 Certification under the Sarbanes-Oxley Act of 2002 of the Principal Financial Officer and Principal Accounting Officer.

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, thereto duly authorized.

		HW HOLDINGS, INC.
		(Registrant)
Dated: May 20, 2015		/s/ Kerry Chung
		Kerry Chung
		President and Chief Executive Officer
		(Principal Executive Officer)
Dated:  May 20, 2015		/s/ Darren Takemoto
		Darren Takemoto
		Chief Financial Officer and Secretary
		(Principal Financial Officer and Principal Accounting Officer)

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.