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

                                   FORM 10-QSB

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

                  For the quarterly period ended March 31, 2008

                                       or

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

         For the transition period from ____________ to ________________

                        Commission file number: 000-28277

                            HERITAGE WORLDWIDE, INC.
                            ------------------------
        (Exact name of small business issuer as specified in its charter)

                 Delaware                                 13-4196258
                 --------                                 ----------
     (State or other jurisdiction of                  (I.R.S. Employer
     incorporation or organization)                  Identification No.)


             337 Avenue de Bruxelles La Seyne-Sur-Mer (France) 83507
             -------------------------------------------------------
               (Address of principal executive offices) (Zip Code)

                              (011) (33) 494-109810
                              ---------------------
                (Issuer's telephone number, including area code)


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

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

The total number of shares of the issuers' common stock, $.001 par value,
outstanding at May 15, 2008 was 17,410,299.

Transitional Small Business Disclosure Format: Yes [ ] No [X]


                                       1
<PAGE>

                SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS


     To the extent that the information presented in this Quarterly Report on
Form 10-QSB for the quarter ended March 31, 2008 discusses financial
projections, information or expectations about our products or markets, or
otherwise makes statements about future events, such statements are
forward-looking. We are making these forward-looking statements in reliance on
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995. Although we believe that the expectations reflected in these
forward-looking statements are based on reasonable assumptions, there are a
number of risks and uncertainties that could cause actual results to differ
materially from such forward-looking statements. These risks and uncertainties
are described, among other places in our 2007 Annual Report of Form 10-KSB, in
"Management's Discussion and Analysis or Plan of Operation."

     In addition, we disclaim any obligations to update any forward-looking
statements to reflect events or circumstances after the date of this Quarterly
Report. When considering such forward-looking statements, you should keep in
mind the risks referenced above and the other cautionary statements in this
Quarterly Report.



                                       2
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                           HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                                  CONSOLIDATED BALANCE SHEET
                                        March 31, 2008
                                          (UNAUDITED)

                                            ASSETS

Current Assets:
  Cash                                                                           $    151,208
  Accounts receivable, net of an allowance for doubtful accounts of $489,924
    and allowance for product returns of $631,326                                   8,267,094
  Inventories, net of allowance for obsolescence of $610,788                        5,171,162
  Prepaid expenses and other current assets                                         1,059,715
                                                                                 ------------

     Total current assets                                                          14,649,179

Property and equipment, net of accumulated depreciation of $5,093,188               1,799,509
Goodwill                                                                            1,380,996
Investment in SCI Lucas                                                               799,174
Other assets                                                                          165,768
                                                                                 ------------

     Total assets                                                                $ 18,794,626
                                                                                 ============

                             LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
  Lines of credit                                                                $  2,623,442
  Accounts payable and accrued expenses                                             7,091,670
  Current portion of capitalized lease obligations                                    224,772
  Current portion of long term debt                                                   415,662
  Convertible debentures and related accrued interest payable,
    net of discount of $14,002-related party                                        1,029,573
  Convertible debentures, net of debt discount of $419,367                          2,580,633
  Reserve for product replacements                                                    178,926
                                                                                 ------------

     Total current liabilities                                                     14,144,678


Capitalized lease obligations, net of current portion                                 245,817
Long term debt, net of current portion                                              1,060,182
                                                                                 ------------

     Total liabilities                                                             15,450,677
                                                                                 ------------

Minority interest                                                                     826,593
                                                                                 ------------

Stockholders' Equity:
  Common stock; $.001 par value, 50,000,000 shares authorized,
    18,160,299 issued and 17,410,299 outstanding                                       17,411
  Additional paid-in capital                                                        6,254,721
  Accumulated other comprehensive income                                            3,510,037
  Accumulated deficit                                                              (7,264,813)
                                                                                 ------------

     Total stockholders' equity                                                     2,517,356
                                                                                 ------------

     Total liabilities and stockholders' equity                                  $ 18,794,626
                                                                                 ============


                   See Notes to Unaudited Consolidated Financial Statements.


                                              3
<PAGE>

                                     HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                                       CONSOLIDATED STATEMENTS OF OPERATIONS
                                                    (UNAUDITED)

                                                        For the three-month period      For the nine-month period
                                                              ended March 31,                ended March 31,
                                                       ----------------------------    ----------------------------
                                                           2008            2007            2008            2007
                                                       ------------    ------------    ------------    ------------

Revenues                                               $  3,652,235    $  3,188,873    $ 13,056,383    $ 10,958,343

Cost of revenues                                          1,957,182       1,767,474       6,098,886       5,277,126
                                                       ------------    ------------    ------------    ------------

     Gross profit                                         1,695,053       1,421,399       6,957,497       5,681,217
                                                       ------------    ------------    ------------    ------------

Operating expenses:
  Selling, general and administrative                     2,221,098       1,085,130       7,197,233       5,121,221
  Research and development                                  215,813         199,114         886,429         919,017
                                                       ------------    ------------    ------------    ------------

     Total operating expenses                             2,436,911       1,284,244       8,083,662       6,040,238
                                                       ------------    ------------    ------------    ------------

Operating loss                                             (741,858)        137,155      (1,126,165)       (359,021)
                                                       ------------    ------------    ------------    ------------

Other expenses:
  Gain in equity investment                                  29,823          42,749          39,287          50,894
  Interest expense-related party                            (17,130)        (61,432)        (66,988)       (147,700)
  Interest expense                                         (132,438)        (88,201)       (393,591)       (274,464)
                                                       ------------    ------------    ------------    ------------

     Total other expenses                                  (119,745)       (106,884)       (421,292)       (371,270)
                                                       ------------    ------------    ------------    ------------

Loss before minority interest                              (861,603)         30,271      (1,547,457)       (730,291)

Minority interest                                            43,735         (26,957)         42,886         (13,595)
                                                       ------------    ------------    ------------    ------------

Net loss                                                   (817,868)          3,314      (1,504,571)       (743,886)

Other comprehensive income, net of taxes
  Foreign currency translation adjustment                    81,237         117,998       1,007,084         509,889
                                                       ------------    ------------    ------------    ------------

     Comprehensive income (loss)                       $   (736,631)   $    121,312    $   (497,487)   $   (233,997)
                                                       ============    ============    ============    ============

Basic net loss per common share                        $      (0.05)   $       0.00    $      (0.09)   $      (0.04)
                                                       ============    ============    ============    ============

Basic weighted average common
shares outstanding                                       17,410,299      17,410,299      17,410,299      17,410,299
                                                       ============    ============    ============    ============

Diluted net loss per share                             $      (0.05)   $       0.00    $      (0.09)   $      (0.04)
                                                       ============    ============    ============    ============

Diluted weighted average common shares outstanding       17,410,299      17,423,774      17,410,299      17,410,299
                                                       ============    ============    ============    ============

                             See Notes to Unaudited Consolidated Financial Statements.


                                                         4
<PAGE>

                      HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (UNAUDITED)

                                                          For the nine-month period
                                                               ended March 31,
                                                        ----------------------------
                                                            2008            2007
                                                        ------------    ------------
Cash flows from operating activities:
Net loss                                                $ (1,504,571)   $   (743,886)
Adjustments to reconcile net loss to net cash
used in operating activities:
   Interest expense related to debenture discount            335,041         365,952
   Depreciation and amortization                             602,785         498,059
   Fair value of options                                      69,486         323,999
   Provision for doubtful accounts                           175,217         (91,743)
   Provision for returns                                     (49,819)       (101,688)
   Provision for obsolescence- inventory                     (12,044)              -
   Gain on equity investment                                 (39,287)        (50,894)
   Minority interest                                         (42,886)         13,595
Change in operating assets and liabilities:
   Accounts receivable                                       321,881         126,387
   Inventories                                              (200,863)       (483,443)
   Prepaid expenses and other current assets                (221,429)        (78,976)
   Other assets                                              (47,380)        194,963
   Provision for product replacements                              -          12,519
   Accrued interest on convertible debentures                  7,534           4,987
   Accounts payable and accrued expenses                     286,464        (763,921)
                                                        ------------    ------------

Net cash used in operating activities                       (319,871)       (774,090)
                                                        ------------    ------------

Cash flows from investing activity:

   Purchases of property and equipment                      (164,529)       (258,957)
                                                        ------------    ------------

Net cash used in investing activity                         (164,529)       (258,957)
                                                        ------------    ------------

Cash flows from financing activities:
   Increase in lines of credit                                97,688         735,488
   Proceeds from long term debt                              801,332         183,089
   Repayment of long term debt                              (226,878)       (254,135)
   Repayment of capitalized lease obligations               (198,889)        (70,076)
   Increase in due to related parties                              -          80,003
                                                        ------------    ------------

Net cash provided by financing activities                    473,253         674,369
                                                        ------------    ------------

Effect of exchange rate changes on cash                      (37,703)        (53,786)
                                                        ------------    ------------

Decrease in cash                                             (48,850)       (412,464)

Cash, beginning of period                                    200,058         695,509
                                                        ------------    ------------

Cash, end of period                                     $    151,208    $    283,045
                                                        ============    ============

Supplemental disclosures of cash flow information:
     Cash paid during the period for interest           $     74,292    $     37,583
                                                        ============    ============

     Cash paid during the period for taxes              $          -    $          -
                                                        ============    ============

              See Notes to Unaudited Consolidated Financial Statements.


                                          5
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<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 1 - NATURE OF BUSINESS

Heritage Worldwide, Inc. (the "Company") was incorporated in the State of
Delaware in 2001. The Company and its subsidiaries develop, manufacture, and
market breast and other body implants and body support products worldwide. The
Company maintains its production facility and headquarters in the Toulon
metropolitan area in Southern France. It also has a distribution facility in
Spain.

NOTE 2 - BASIS OF PRESENTATION AND CONSOLIDATION

The accompanying consolidated financial statements present the results of
operations of the Company's French ("PIP France"), Spanish ("PIP Spain"), and
United States subsidiaries for the nine-month period ended March 31, 2008 and
2007. All material inter-company accounts and transactions between the Company
and its subsidiaries have been eliminated in consolidation.

The accompanying unaudited consolidated financial statements include the results
of operations of SCI Lucas, a real estate holding company, in which the Company
holds an interest of 38.05%. SCI Lucas owns the production facility and
headquarters in which the Company operates in Southern France. The results of
operations of SCI Lucas are accounted for using the equity method of accounting.
All material inter-company accounts and transactions between the Company and SCI
Lucas have been eliminated.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Going Concern

The Company's financial statements have been presented on the basis that it is a
going concern, which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business. The Company used cash of
approximately $320,000 for its operating activities during the nine-month period
ended March 31, 2008. Furthermore, the Company has two convertible promissory
notes amounting to $4,000,000 maturing within one year. One of the noteholders
has indicated that they are not going to convert their promissory note of
$3,000,000 into shares of the Company's stock. These conditions raise
substantial doubt about its ability to continue as a going concern.

As a result, the Company's current operations are not an adequate source of cash
to fund future operations and the Company does not have sufficient unused lines
of credit to repay the convertible promissory notes. The Company's ability to
continue as a going concern is dependent upon its ability to obtain the
necessary financing to meet its obligations and repay its liabilities when they
become due and to generate profitable operations in the future. The Company
plans to continue to increase its revenues and provide for its capital
requirements through our lines of credit, however, there are no firm commitments
from any third party to provide such revenues or financing and the Company
cannot assure that it will be successful in obtaining such commitments as
needed. The Company will attempt to secure financing which would satisfy its
obligations under the convertible promissory notes and, to a lesser extent,
satisfy its obligations related to our operations. There are no assurances that
the Company will have sufficient funds to


                                       6
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

execute its business plan, pay its obligations as they become due or generate
positive operating results.

Use of estimates

In preparing financial statements in conformity with accounting principles
generally accepted in the United States, management is required to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements and revenues and expenses during the reporting
period. Actual results will differ from those estimates. Significant estimates
during the periods include the allowance for doubtful accounts, allowance for
product returns, evaluation of obsolete inventory, the useful life of long-term
assets, such as property, plant and equipment and goodwill, and the accrual of
product replacement reserve.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of
three months or less to be cash equivalents.

Accounts receivable

Accounts receivable are reported at net realizable value. The Company has
established an allowance for doubtful accounts based upon factors pertaining to
the credit risk of specific customers, historical trends, and other information.
Delinquent accounts are written-off when it is determined that the amounts are
uncollectible. At March 31, 2008, the allowance for doubtful accounts was
approximately $490,000. Additionally, the Company has established an allowance
for product returns based upon factors pertaining to historical trends,
including, among other things, recent and historical return rates for both
specific products and distributors, the impact of any new product releases in a
new jurisdiction and projected economic conditions. At March 31, 2008, the
allowance for product returns was approximately $630,000.

Revenue recognition

The Company recognizes product revenue, net of estimated sales discounts and
provisions for returns, in accordance with Staff Accounting Bulletin No. 104,
"Revenue Recognition in Financial Statements" and SFAS No. 48 "Revenue
Recognition When Right of Return Exists." These statements established that
revenue can be recognized when persuasive evidence of an arrangement exists, the
product has been shipped, all significant contractual obligations have been
satisfied, the fee is fixed or determinable and collection is reasonably
assured.

Prior to July 1, 2006, the Company entered in bill and hold arrangements. No
bill and hold arrangements were outstanding at March 31, 2008. Bill and hold
arrangements would have to meet the following criteria for revenue recognition:


                                       7
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

     o    The risks of ownership passed to the buyer;
     o    The customer made a fixed commitment to purchase the breast implants,
          in writing;
     o    The buyer, not the Company, requested that the transaction be on a
          bill and hold basis. The buyer had a substantial business purpose for
          ordering the goods on a bill and hold basis-primarily its on lack of
          warehousing space;
     o    There is a fixed schedule for delivery of the goods. The dates for
          delivery are reasonable and are consistent with the buyer's business
          purpose;
     o    The Company did not retain any specific performance obligations such
          that the earning process is not complete;
     o    The ordered breast implants were segregated from the Company's
          inventory and were not subject to being used to fill other orders;
     o    The breast implants were complete and ready for shipment.
     o    The date by which the Company expect payment was not modified and the
          Company has not modified its normal billing and credit terms for this
          buyer;
     o    The Company's past experiences with and pattern of bill and hold
          transactions;
     o    The buyer has the expected risk of loss in the event of a decline in
          the market value of the breast implants;
     o    The Company's custodial risks are insurable and insured; and
     o    The business reasons for the bill and hold have not introduced a
          contingency to the buyer's commitment.

Stock options

Effective January 1, 2006, the Company adopted the fair value recognition
provisions of SFAS No. 123R, Share-Based Payment, and related interpretations
using the modified-prospective transition method. Under that method,
compensation cost recognized in the first quarter of 2006 includes (a)
compensation cost for all stock-based awards granted prior to, but not yet
vested as of January 1, 2006 based on the grant date fair value estimated in
accordance with the original provisions of SFAS No. 123 and (b) compensation
cost for all stock-based awards granted on or subsequent to January 1, 2006,
based on the grant-date fair value estimated in accordance with the provisions
of SFAS No. 123R. Results for prior periods have not been restated. Prior to the
adoption of SFAS No. 123R, the Company never recognized tax benefits from
deductions resulting from the exercise of stock options because no options have
ever been recognized.


                                       8
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Foreign currency translation

For foreign operations with the local currency as the functional currency,
assets and liabilities are translated from the local currencies into U.S.
dollars at the exchange rate prevailing at the balance sheet date. Revenues,
expenses and cash flows are translated at the average exchange rate for the
period to approximate translation at the exchange rate prevailing at the dates
those elements are recognized in the financial statements. Translation
adjustments resulting from the process of translating the local currency
financial statements into U.S. dollars are included in determining comprehensive
loss. As of March 31, 2008, the exchange rate for the Euros (EUR) was $1.58 U.S.
for 1.00 EUR.

The functional currency of the Company's French and Spanish subsidiaries is the
local currency. The financial statements of the subsidiary are translated to
U.S. dollars using period-end rates of exchange for assets and liabilities, and
the average rate of exchange for the period for revenues, costs, and expenses.
Net gains and losses resulting from foreign exchange transactions are included
in the consolidated statements of operations.

Inventories

Inventories are stated at the lower of cost or market, cost determined by the
first-in, first-out (FIFO) method. The Company writes down its inventory for
estimated obsolescence or unmarketable inventory equal to the difference between
the cost of inventory and the estimated market value based upon assumptions
about future demand and market conditions. The Company writes down inventory
during the period in which such products are no longer marketable in any of
their markets due to governmental regulations as well as inventory which matures
within the next three months of the measurement date.

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation and
amortization. Depreciation is recorded on the straight-line basis over the
estimated useful lives of the assets, which range from three to ten years.
Amortization of leasehold improvements and capital leases is recorded over the
shorter of the straight-line basis over the estimated useful life or the lease
term of the asset. Normal maintenance and repairs of property and equipment are
expensed as incurred while renewals, betterments and major repairs that
materially extend the useful life of property and equipment are capitalized.
Upon retirement or disposition of property and equipment, the asset and related
accumulated depreciation or amortization is removed from the accounts and any
resulting gain or loss is charged to operations.


                                       9
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                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Goodwill

Goodwill represents the excess of costs over fair value of assets of businesses
acquired. In June 2001, the Financial Accounting Standards Board ("FASB")
approved the issuance of Statement of Financial Accounting Standards ("SFAS")
No. 141, "Business Combinations" and SFAS No. 142, "Goodwill and Other
Intangible Assets." These standards require that all business combinations
initiated after December 31, 2001 be accounted for using the purchase method. In
addition, all intangible assets acquired that are obtained through contractual
or legal right, or are capable of being separately sold, transferred, licensed,
rented or exchanged shall be recognized as an asset apart from goodwill.
Goodwill and intangibles with indefinite lives will no longer be subject to
amortization, but will be subject to at least an annual assessment for
impairment by applying a fair value based test.

The Company's goodwill at June 30, 2007 results from its 2002 acquisition of its
Spanish subsidiary. Management has established that based on future cash flows
generated from its Spanish operations, the Company's goodwill at March 31, 2008
is not impaired.

Impairment of Long-Lived Assets

The Company reviews long-lived assets for impairment whenever circumstances and
situations change such that there is an indication that the carrying amounts may
not be recovered. In such circumstances, the Company will estimate the future
cash flows expected to result from the use of the asset and its eventual
disposition. Future cash flows are the future cash inflows expected to be
generated by an asset less the future outflows expected to be necessary to
obtain those inflows. If the sum of the expected future cash flows (undiscounted
and without interest charges) is less than the carrying amount of the asset, the
Company will recognize an impairment loss to adjust to the fair value of the
asset. At March 31, 2008, the Company believes that there has been no impairment
of its long-lived assets.

Investment

The Company's investment is reported on the equity method of accounting. Under
this method the initial investment is recorded at cost. Subsequently, the
investment is increased or decreased to reflect the Company's share of income,
losses and dividends paid.

Income Taxes

The Company uses the liability method for income taxes as required by SFAS No.
109 "Accounting for Income Taxes." Under this method, deferred tax assets and
liabilities are determined based on differences between financial reporting and
tax basis of assets and liabilities. Deferred tax assets and liabilities are
measured using enacted tax rates and laws that will be in effect when the
differences are expected to reverse. Valuation allowances are established when
it is more likely than not that the deferred tax assets will not be realized.


                                       10
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                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Shipping and Handling Costs

Shipping and handling costs are included in cost of revenues in accordance with
guidance established by the Emerging Issues Task Force, issue No. 00-10,
"Accounting for Shipping and Handling Costs."

Research and Development

Research and development costs are charged to operations as incurred and
consists primarily of salaries and related benefits, raw materials and supplies.

Income (Loss) per Share

The Company presents basic income (loss) per share and, if appropriate, diluted
earnings per share in accordance with the provisions of SFAS No. 128 "Earnings
per Share" ("SFAS 128").

Under SFAS 128, basic net income (loss) per share is computed by dividing the
net income (loss) for the year by the weighted average number of common shares
outstanding during the year. Diluted net income per share is computed by
dividing the net income for the year by the weighted average number of common
shares and common share equivalents outstanding during the year. The Company has
1,215,000 options outstanding at March 31, 2008. Additionally, the Company may
have to issue up to 2,220,512 shares upon conversion of certain convertible
debentures. All common stock equivalents outstanding during the nine-month
period ended March 31, 2008 are antidilutive.

                                                     2008            2007
                                                     ----            ----
Numerator:
Net loss                                         $(1,504,571)    ($  743,886)
                                                 ===========     ===========

Denominator:
Denominator for basic earnings per share-
Weighted average shares outstanding               17,410,299      17,410,299
Effect of dilutive employee stock options                  -               -
Denominator for diluted earnings per share-
Weighted average shares outstanding               17,410,299      17,410,299

Basic earnings per share                              ($0.09)         ($0.04)
                                                      ======          ======
Diluted earnings per share                            ($0.09)         ($0.04)
                                                      ======          ======


                                       11
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Fair Value of Financial Instruments

The carrying amounts of financial instruments, including cash, accounts
receivable, lines of credit and accounts payable and accrued expenses
approximate fair value at March 31, 2008 because of the relatively short
maturity of the instruments. The carrying value of capitalized lease
obligations, long-term debt, and convertible debentures approximate fair value
at March 31, 2008 based upon terms available for companies under similar
arrangements.

New Accounting Pronouncements

In March 2008, the FASB issued Statement of Financial Accounting Standards
("SFAS") No. 161, Disclosures about Derivative Instruments and Hedging
Activities, an amendment of FASB Statement No. 133, which requires additional
disclosures about the objectives of the derivative instruments and hedging
activities, the method of accounting for such instruments under SFAS No. 133 and
its related interpretations, and a tabular disclosure of the effects of such
instruments and related hedged items on our financial position, financial
performance, and cash flows. SFAS No. 161 is effective for the Company beginning
January 1, 2009. Management believes that, for the foreseeable future, this
Statement will have no impact on the financial statements of the Company once
adopted.

In December 2007, the FASB issued FASB Statement No. 160 - Noncontrolling
Interests in Consolidated Financial Statements - an amendment of ARB No. 51.
This Statement applies to all entities that prepare consolidated financial
statements, except not-for-profit organizations, but will affect only those
entities that have an outstanding noncontrolling interest in one or more
subsidiaries or that deconsolidate a subsidiary. Not-for-profit organizations
should continue to apply the guidance in Accounting Research Bulletin No. 51,
Consolidated Financial Statements, before the amendments made by this Statement,
and any other applicable standards, until the Board issues interpretative
guidance.

This Statement amends ARB 51 to establish accounting and reporting standards for
the noncontrolling interest in a subsidiary and for the deconsolidation of a
subsidiary. It clarifies that a noncontrolling interest in a subsidiary is an
ownership interest in the consolidated entity that should be reported as equity
in the consolidated financial statements. Before this Statement was issued,
limited guidance existed for reporting noncontrolling interests. As a result,
considerable diversity in practice existed. So-called minority interests were
reported in the consolidated statement of financial position as liabilities or
in the mezzanine section between liabilities and equity. This Statement improves
comparability by eliminating that diversity.

A noncontrolling interest, sometimes called a minority interest, is the portion
of equity in a subsidiary not attributable, directly or indirectly, to a parent.
The objective of this Statement is to improve the relevance, comparability, and
transparency of the financial information that a reporting entity provides in
its consolidated financial statements by establishing accounting and reporting
standards that require: (a) The ownership interests in subsidiaries held by
parties other than the parent be clearly identified, labeled, and presented in
the consolidated statement of


                                       12
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

financial position within equity, but separate from the parent's equity, (b) The
amount of consolidated net income attributable to the parent and to the
noncontrolling interest be clearly identified and presented on the face of the
consolidated statement of income, (c) Changes in a parent's ownership interest
while the parent retains its controlling financial interest in its subsidiary be
accounted for consistently. A parent's ownership interest in a subsidiary
changes if the parent purchases additional ownership interests in its subsidiary
or if the parent sells some of its ownership interests in its subsidiary. It
also changes if the subsidiary reacquires some of its ownership interests or the
subsidiary issues additional ownership interests. All of those transactions are
economically similar, and this Statement requires that they be accounted for
similarly, as equity transactions, (d) When a subsidiary is deconsolidated, any
retained noncontrolling equity investment in the former subsidiary be initially
measured at fair value. The gain or loss on the deconsolidation of the
subsidiary is measured using the fair value of any noncontrolling equity
investment rather than the carrying amount of that retained investment, (e)
Entities provide sufficient disclosures that clearly identify and distinguish
between the interests of the parent and the interests of the noncontrolling
owners.

This Statement is effective for fiscal years, and interim periods within those
fiscal years, beginning on or after December 15, 2008 (that is, January 1, 2009,
for entities with calendar year-ends). Earlier adoption is prohibited. This
Statement shall be applied prospectively as of the beginning of the fiscal year
in which this Statement is initially applied, except for the presentation and
disclosure requirements. The presentation and disclosure requirements shall be
applied retrospectively for all periods presented. Management believes this
Statement will have no impact on the financial statements of the Company once
adopted.

In December 2007, the FASB issued FASB Statement No. 141 (revised 2007),
Business Combinations. This Statement replaces FASB Statement No. 141, Business
Combinations. This Statement retains the fundamental requirements in Statement
141 that the acquisition method of accounting (which Statement 141 called the
purchase method) be used for all business combinations and for an acquirer to be
identified for each business combination. This Statement defines the acquirer as
the entity that obtains control of one or more businesses in the business
combination and establishes the acquisition date as the date that the acquirer
achieves control. This Statement's scope is broader than that of Statement 141,
which applied only to business combinations in which control was obtained by
transferring consideration. By applying the same method of accounting--the
acquisition method--to all transactions and other events in which one entity
obtains control over one or more other businesses, this Statement improves the
comparability of the information about business combinations provided in
financial reports.

This Statement requires an acquirer to recognize the assets acquired, the
liabilities assumed, and any noncontrolling interest in the acquiree at the
acquisition date, measured at their fair values as of that date, with limited
exceptions specified in the Statement. That replaces Statement 141's
cost-allocation process, which required the cost of an acquisition to be
allocated to the individual assets acquired and liabilities assumed based on
their estimated fair values.


                                       13
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

This Statement applies to all transactions or other events in which an entity
(the acquirer) obtains control of one or more businesses (the acquirer),
including those sometimes referred to as "true mergers" or "mergers of equals"
and combinations achieved without the transfer of consideration, for example, by
contract alone or through the lapse of minority veto rights. This Statement
applies to all business entities, including mutual entities that previously used
the pooling-of-interests method of accounting for some business combinations. It
does not apply to: (a) The formation of a joint venture, (b) The acquisition of
an asset or a group of assets that does not constitute a business, (c) A
combination between entities or businesses under common control, (d) A
combination between not-for-profit organizations or the acquisition of a
for-profit business by a not-for-profit organization.

This Statement 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. An entity may not apply it
before that date. Management believes this Statement will have no impact on the
financial statements of the Company once adopted.



                                       14
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued).

In September 2006, the FASB issued FASB Statement No. 157. This Statement
defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles (GAAP), and expands disclosures about
fair value measurements. This Statement applies under other accounting
pronouncements that require or permit fair value measurements, the Board having
previously concluded in those accounting pronouncements that fair value is a
relevant measurement attribute. Accordingly, this Statement does not require any
new fair value measurements. However, for some entities, the application of this
Statement will change current practices. This Statement is effective for
financial statements for fiscal years beginning after November 15, 2007. Earlier
application is permitted provided that the reporting entity has not yet issued
financial statements for that fiscal year. Management believes that, for the
foreseeable future, this Statement will have no impact on the financial
statements of the Company once adopted.

In February 2007, the FASB issued FASB Statement 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. The objective is to
improve financial reporting by providing entities with the opportunity to
mitigate volatility in reported earnings caused by measuring related assets and
liabilities differently without having to apply complex hedge accounting
provisions. This Statement is expected to expand the use of fair value
measurement, which is consistent with the FASB's long-term measurement
objectives for accounting for financial instruments. This Statement applies to
all entities, including not-for-profit organizations. Most of the provisions of
this Statement apply only to entities that elect the fair value option.



                                       15
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

However, the amendment to FASB Statement No. 115, "Accounting for Certain
Investments in Debt and Equity Securities," applies to all entities with
available-for-sale and trading securities. Some requirements apply differently
to entities that do not report net income. The following are eligible items for
the measurement option established by this Statement:

     1.   Recognized financial assets and financial liabilities except:
          a)   An investment in a subsidiary that the entity is required to
               consolidate;
          b)   An interest in a variable interest entity that the entity is
               required to consolidate;
          c)   Employers' and plans' obligations (or assets representing net
               overfunded positions) for pension benefits, other postretirement
               benefits (including health care and life insurance benefits),
               postemployment benefits, employee stock option and stock purchase
               plans, and other forms of deferred compensation arrangements, as
               defined in FASB Statements No. 35, "Accounting and Reporting by
               Defined Benefit Pension Plans", No. 87, "Employers' Accounting
               for Pensions", No. 106, "Employers' Accounting for Postretirement
               Benefits Other Than Pensions", No. 112, "Employers' Accounting
               for Postemployment Benefits", No. 123 (revised December 2004),
               "Share-Based Payment", No. 43, "Accounting for Compensated
               Absences", No. 146, "Accounting for Costs Associated with Exit or
               Disposal Activities", and No. 158, "Employers' Accounting for
               Defined Benefit Pension and Other Postretirement Plans", and APB
               Opinion No. 12, "Omnibus Opinion--1967";
          d)   Financial assets and financial liabilities recognized under
               leases as defined in FASB Statement No. 13, "Accounting for
               Leases" (This exception does not apply to a guarantee of a
               third-party lease obligation or a contingent obligation arising
               from a cancelled lease.);
          e)   Deposit liabilities, withdrawable on demand, of banks, savings
               and loan associations, credit unions, and other similar
               depository institutions;
          f)   Financial instruments that are, in whole or in part, classified
               by the issuer as a component of shareholder's equity (including
               "temporary equity"). An example is a convertible debt security
               with a noncontingent beneficial conversion feature.
     2.   Firm commitments that would otherwise not be recognized at inception
          and that involve only financial instruments;
     3.   Nonfinancial insurance contracts and warranties that the insurer can
          settle by paying a third party to provide those goods or services; and
     4.   Host financial instruments resulting from separation of an embedded
          nonfinancial derivative instrument from a nonfinancial hybrid
          instrument.

The fair value option established by this Statement permits all entities to
choose to measure eligible items at fair value at specified election dates. A
business entity shall report unrealized gains and losses on items for which the
fair value option has been elected in earnings (or another performance indicator
if the business entity does not report earnings) at each subsequent reporting
date. A not-for-profit organization shall report unrealized gains and losses in
its statement of activities or similar statement.


                                       16
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The fair value option:

     o    May be applied instrument by instrument, with a few exceptions, such
          as investments otherwise accounted for by the equity method
     o    Is irrevocable (unless a new election date occurs)
     o    Is applied only to entire instruments and not to portions of
          instruments.

This Statement is effective as of the beginning of an entity's first fiscal year
that begins after November 15, 2007. Early adoption is permitted as of the
beginning of a fiscal year that begins on or before November 15, 2007, provided
the entity also elects to apply the provisions of FASB Statement No. 157, "Fair
Value Measurements". No entity is permitted to apply this Statement
retrospectively to fiscal years preceding the effective date unless the entity
chooses early adoption. The choice to adopt early should be made after issuance
of this Statement but within 120 days of the beginning of the fiscal year of
adoption, provided the entity has not yet issued financial statements, including
required notes to those financial statements, for any interim period of the
fiscal year of adoption. This Statement permits application to eligible items
existing at the effective date (or early adoption date).

Other accounting standards that have been issued or proposed by the FASB or
other standards-setting bodies that do not require adoption until a future date
are not expected to have a material impact on the consolidated financial
statements upon adoption.

Allowance for Product Returns

In the normal course of business, the Company does not provide stock-balancing
or price protection rights to its distributors; however, on a non-recurring
basis, it has historically accepted product returns. The Company estimates its
allowance for product returns to amount to approximately $630,000 at March 31,
2008. Management establishes provisions for estimated returns concurrently with
the recognition of revenue. The provisions are established based upon
consideration of a variety of factors, including, among other things, recent and
historical return rates for both specific distributors and projected economic
conditions.

Allowance for Product Replacements

The Company provides a product replacement program on its products. The Company
provides an accrual for the estimated cost of product replacement and product
liability claims at the time revenue is recognized. Such accruals are based on
estimates, which are based on relevant factors such as historical experience,
the warranty period, estimated replacement costs, identified product quality
issues and are discounted to a current value. Management estimated the amount of
potential future product replacement claims based on statistical analysis.
Changes to actual claims and interest rates could have a material impact on the
statistical calculation which could materially impact the Company's reported
expenses and results of operations.


                                       17
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Concentration of Credit Risks

The Company is subject to concentrations of credit risk primarily from cash and
cash equivalents and accounts receivable. The Company maintains accounts with
French financial institutions, which at times exceeds the insured French
statutory limit of approximately $150,000. The Company minimizes its credit
risks associated with cash by periodically evaluating the credit quality of its
primary financial institutions. The Company's accounts receivables are due from
surgeons in France and from distributors in all other countries in which it
markets its products. The Company does not require collateral to secure its
accounts receivables. However, the Company regularly insures a proportion of its
accounts receivable through a financial institution.

At March 31, 2008, the financial institution insured approximately $4.2 million
of the Company's accounts receivables. One of the Company's customers accounted
for 14% of its net accounts receivables at March 31, 2008.

Product Concentration Risk

Substantially all of the Company's revenues derive from the sale of breast
implants.

Supplier Concentration Risk

One of the Company's suppliers procures titanium which is used as coating in
certain of the Company's breast implants. The agreement with this supplier
terminates in 2009. The Company cannot guarantee that it will be able to renew
such agreement on acceptable terms, or if unable to renew the agreement, that it
will secure the procurement of such titanium from other suppliers on similar
terms, if at all.

Customers Concentration Risk

One of the Company's customers accounted for 14% of its revenues during the
nine-month period ended March 31, 2008. Two of the Company's customers accounted
for 15% and 10%, respectively, of its revenues during the nine-month period
ended March 31, 2007.

NOTE 4 - INVENTORIES

Inventories at March 31, 2008 consist of the following:

Finished goods                    $  4,484,986
Work-in-process                        804,987
Raw materials                          491,977
                                  ------------
                                     5,781,950
Provision for obsolescence            (610,788)
                                  ------------
                                  $  5,171,162
                                  ============


                                       18
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 5 - PROPERTY AND EQUIPMENT

Property and equipment and related accumulated depreciation at March 31, 2008
consist of the following:

Tenant improvements                $    143,419
Machinery and equipment               4,892,607
Office equipment                        293,029
Transportation equipment                214,786
Capitalized lease                     1,080,344
Software                                268,509
                                   ------------
                                      6,892,694
Accumulated depreciation             (5,093,188)
                                   ------------
Property and equipment, net        $  1,799,509
                                   ============

Depreciation expense amounted to approximately $603,000 and $498,000 during the
nine-month period ended March 31, 2008 and 2007, respectively.

NOTE 6 - INVESTMENTS

At March 31, 2008, the Company has a 38.05% investment in SCI Lucas, a related
French real estate company. The equity in income of the investee amounted to
approximately $39,000 and $51,000 during the nine-month period ended March 31,
2008 and 2007, respectively. SCI Lucas leases its facilities to the Company,
which is the sole tenant. The leases expire in November 2009. The leases are
renewable automatically unless the Company cancels the leases nine months prior
to the renewal date. The Company incurred rental expense and paid rent to SCI
Lucas in amounts aggregating approximately $367,000 and $410,000 during the
nine-month period ended March 31, 2008 and 2007, respectively.


                                       19
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 7 - LONG TERM DEBT

The Company's long term debt consists of various notes payable with outstanding
principal amounts ranging from approximately $6,300 to $552,000, with variable
interest rates, based on the EURIBOR plus 1.6% to 2.5%, ranging from 6.3% to
7.2% per year at March 31, 2008, with due dates between April 2010 and December
2012. In addition, the Company has received non-interest bearing advances from
ANVAR, an agency of the French government, which finances or subsidizes certain
research and development projects. If the research does not result in a
commercially feasible product and certain other conditions are met, the Company
will not have to repay some or all of the advances. The Company is currently
unable to determine whether the research associated with the advance will result
in a commercially feasible product and does not anticipate knowing the outcome
of such research efforts in the foreseeable future. Accordingly, the Company
includes the advances in the long-term portion of its debt.

One of the notes payable issued in March 2008 and amounting to $202,000 is
secured by certain equipment with a carrying value of $202,000 at March 31,
2008.

NOTE 8 - CONVERTIBLE DEBENTURES

On October 9, 2003, OSMXM "OS", Inc., one of the Company's subsidiaries, entered
into a convertible debentures purchase agreement (the "Agreement") with HEM
Mutual Assurance, LLC ("HEM") to sell $1,000,000 of 1% convertible debentures
due on October 9, 2008. Interest accrues from the date of the transaction and is
payable in cash or common stock, at the option of the debenture holder. In the
event of default, as defined in the Agreement, interest shall accrue at 15% per
annum. The conversion price for one convertible debenture amounting to $498,750
shall be the lesser of (a) $1.25 or (b) 100% of the average three lowest closing
bid prices during the last forty trading days immediately preceding the
conversion. The conversion price for one convertible debenture amounting to
$500,000 shall be the lesser of (a) $1.56 or (b) 100% of the average three
lowest closing bid prices during the last forty trading days immediately
preceding the conversion. The conversion price for one convertible debenture
amounting to $1,250 is $0.001. As part of the Agreement, OS is required to
maintain a common stock escrow account with 10,000,000 unrestricted,
free-trading shares of common stock. As part of the Company's merger with OS on
October 9, 2003, the Company assumed all the obligations and responsibilities of
the Agreement. In return for issuing the debentures to HEM, the Company received
$500,000 in December 2003 and the remaining $500,000 on January 9, 2004.

On September 9, 2005, Eurofortune Holding, S.A. ("Eurofortune"), an entity
affiliated with the Company's former chief executive officer purchased three
convertible debentures from HEM. Simultaneously, Eurofortune exchanged the three
debentures for two convertible debentures issued by the Company each having an
aggregate principal amount of $500,000. The outstanding principal amount and
accrued interest at the rate of 1% per annum of the debentures is due and
payable on October 9, 2008. The conversion prices of the debentures are fixed at
$1.25 and $1.56. Additionally, the 10 million unrestricted free-trading shares
of the Company's common stock held in escrow were returned to the treasury.


                                       20
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 8 - CONVERTIBLE DEBENTURES (continued)

The convertible debentures initially issued to HEM contain an imbedded
beneficial conversion feature since the fair market value of the common stock
exceeds the most beneficial exercise price on the debenture issuance date. The
value was computed as $1,000,000, which will be amortized over the respective
term of the debentures. During the nine-month period ended March 31, 2008 and
2007, the amortization of the debt discount amounted to approximately $59,000
and $86,000, respectively, and has been included in interest expense in the
accompanying consolidated financial statements. Accrued interest associated with
the convertible debentures amounted to approximately $44,000 at March 31, 2008.

In April 2004, the Company sold its Senior Convertible Debenture (the
"Debenture") in the face amount of $3,000,000 to Armadillo Investments, PLC. In
consideration for the Debenture, the Company received 1,595,745 ordinary shares
of Armadillo Investments. The Company immediately sold these shares for
approximately $1,420,000. The Debenture does not bear interest. In the event of
default, as defined under the Debenture. The Debenture accrues interest at the
rate of 10% per annum. The Debenture matures on March 25, 2009. The Debenture is
convertible into our common stock at a conversion price per share of (a) four
dollars ($4.00) (the "Fixed Conversion Price") or (b) eighty percent (80%) of
the lowest closing bid price for the Common Stock in the ten (10) business days
preceding the date of conversion, but in no event less than fifty percent (50%)
of the Fixed Conversion Price (the "Floating Conversion Price").

For purposes of determining the closing bid price on any day, reference shall be
the closing bid price for a share of Common Stock on such date on the OTC
Bulletin Board, as reported on Bloomberg, L.P. (or similar organization or
agency succeeding to its functions of reporting prices). The Company granted
piggyback registration rights with respect to the common stock into which the
Debenture is convertible. The Company is required to maintain in escrow 750,000
shares of common stock upon conversion of the Debenture.

The difference between the face amount of the Debenture and the proceeds
generated from the shares received in exchange of the Debentures amounted to
approximately $1,580,000 and has been recorded as a debt discount. Such debt
discount is amortized over the term of the Debenture. During the nine-month
period ended March 31, 2008 and 2007, the amortization of the debt discount
amounted to approximately $394,000 and $237,000, respectively, and has been
included in interest expense in the accompanying financial statements.


                                       21
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 9 - LINES OF CREDIT

The Company entered into lines of credit agreements with two financial
institutions up to the aggregate amount of approximately $5.0 million. The
Company has used approximately $2.6 million under such lines of credit at March
31, 2008. The lines of credit bear interest at the URIBOR rate plus 2.0% to 3.7%
at March 31, 2008. The outstanding principal balance plus any interest is
payable on demand and is secured by accounts receivables of approximately $4.2
million and inventories of approximately $5.2 million.

Effective March 31, 2004, concurrent with an amended distribution agreement, the
Company issued to a distributor a revolving promissory note for certain sums to
come due to Medicor based on Medicor's and the manufacturer's administration of
product replacement claims. The note bears interest at the rate of 6.75% per
annum. The principal amount under the note as of March 31, 2008 was $0. The
distributor is presently under bankruptcy proceedings. During August 2007, the
distributior claimed that the Company owes $4.8 million under the promissory
note. The Company disputes that it presently owes the distributor the $4.8
million claimed to be due under the amended distribution agreement and has
sought substantiation for such amount by requesting information from the
distributor. To date, the distributor has not provided the information
requested. The Company has notified the distributor that it is in default under
the amended distribution agreement and terminated the agreement in May 2007.

Based on the review of certain information supplied by an agent for the
distributor to the Company's consultant on U.S. Food & Drug Administration
matters, the Company believes that the distributor did not comply with its
obligations under the amended distribution agreement. As a result of the
distributor's breach of its obligations to the Company, the Company believes
that it has incurred significant damages in excess of the $4.8 million claimed
to be due to the distributor because of the distributor's breach of its
obligations under the amended distribution agreement. During November 2007, the
Company filed proof of a claim in excess of $28.7 million against Medicor. The
Company has provided for a provision for such claims aggregating $1.8 million at
March 31, 2008, as reflected in accounts payable and accrued expenses in the
accompanying balance sheet.

NOTE 10 - STOCK OPTIONS

In July 2004, the Board of Directors adopted the Heritage Worldwide, Inc. 2004
Stock Option Plan (the "2004 Plan"). The Company intends to attract and retain
employees and valuable contractors by allowing them an additional incentive to
promote the financial success of the Company.

The 2004 Plan allows for the grant of both incentive stock options and
nonstatutory stock options.


                                       22
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

The 2004 Plan may be administered, interpreted and constructed by the Board of
Directors or a compensation committee. The maximum number of shares of common
stock which may be issued pursuant to options granted under the 2004 Plan may
not exceed 2,000,000 shares. During July 2004, the Company issued 1,175,000
options. If any options granted under the 2004 Plan expires or terminates
without having been exercised or ceased to be exercisable, such options will be
available again under the 2004 Plan. All employees of the Company and its
subsidiaries are eligible to receive incentive stock options and nonstatutory
stock options. Non-employee directors and outside consultants who provided
bona-fide services not in connection with the offer or sale of securities in a
capital raising transaction are eligible to receive nonstatutory stock options.
Incentive stock options may not be granted below their fair market value at the
time of grant or, if to an individual who beneficially owns more than 10% of the
total combined voting power of all stock classes of the Company or a subsidiary,
the option price may not be less than 110% of the fair value of the common stock
at the time of grant. The expiration date of an incentive stock option may not
be longer than ten years from the date of grant. Option holders, or their
representatives, may exercise their vested options up to three months after
their employment termination or one year after their death or permanent and
total disability. The 2004 Plan provides for adjustments upon changes in
capitalization.

During the nine-month periods ended March 31, 2008 and 2007, the Company
recorded share-based payment expenses amounting to approximately $69,000 and
$324,000, respectively, in connection with all options outstanding at the
respective measurement dates. The amortization of share-based payment were
recorded in cost of revenues.

As of March 31, 2008, the unrecognized compensation costs related to non-vested
awards amounted to approximately $34,000, which will be recognized over the next
12 months.

NOTE 11 - SEGMENT AND GEOGRAPHIC INFORMATION

The Company operates in one single segment, breast implants and analyzes its
revenues as derived from two geographic locations: France and the rest of the
world. The Company did not have revenues from the U.S. during the nine-month
periods ended March 31, 2008 and 2007. Information about the Company's sales in
different geographic locations for the nine-month periods ended March 31, 2008
and 2007, respectively is shown below pursuant to the provisions of SFAS No.
131, "Disclosures about segments of an Enterprise and Related Information."

                           Nine-month period ended
                                  March 31,
                             2008            2007
                             ----            ----
France                   $  2,118,919   $  2,039,403
Outside of France          10,937,464      8,918,940
                         ------------   ------------
                         $ 13,056,383   $ 10,958,343
                         ============   ============

Substantially all of the identifiable operating assets and liabilities of the
Company are within France.


                                       23
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 12 - LEGAL CONTINGENCIES

In October 1999, June 2000 and July 2003, separate but related complaints were
filed by Saul Kwartin, Ruth Kwartin, Steven M. Kwartin, Robert Kwartin and Nina
Kwartin against our subsidiary Poly Implant Protheses, S.A. ("PIP"), III
Acquisition Corp. d/b/a PIP .America, PIP/USA, Inc., Jean-Claude Mas, our former
CEO, personally, and others, in the Circuit Court of Miami-Dade County, Florida.
Plaintiffs are all members of one family who purport to be shareholders of
PIP/USA, Inc., a distributor of PIP, suing derivatively on its behalf, and
individually, and seeking to rescind various transactions between PIP .America
and PIP, and seeking to impose liability against PIP and its co-defendants for
unspecified monetary damages arising out of alleged tortious and other purported
wrongful acts concerning alleged relationships between plaintiffs, PIP and the
other defendants.

Initially, two cases were filed: one in October of 1999 by Saul and Ruth Kwartin
and assigned Case No. 99-25227-CA-01 and one in June of 2000 by Steven Kwartin
and assigned Case No. 00-14665-CA-01. Case No. 99-25227 was voluntarily
dismissed by the Plaintiffs, who then unsuccessfully tried to withdraw their
dismissal. The Plaintiffs then appealed. In May of 2004, the appellate court
affirmed the trial court's Order approving the voluntary dismissal. A motion by
PIP/USA and Mr. Mas to recover their attorneys' fees is pending in the trial
court, as is a motion to disqualify the Plaintiffs' counsel in that lawsuit.
Case No. 00-14665-CA-01 by Steven Kwartin remains pending. In June of 2003,
Robert and Nina Kwartin commenced a lawsuit assigned Case No. 03-15006. That
lawsuit remains pending. In September of 2003, Saul and Ruth Kwartin filed
another lawsuit assigned Case No. 03-22537-CA-27, alleging similar claims to
those included in the dismissed case. Within a day or two of that lawsuit,
Steven Kwartin filed his second lawsuit assigned Case No. 03-22399-CA-15,
against Mr. Mas and Donald McGhan only. On December 22, 2005 four of the five
lawsuits were consolidated for pre-trial purposes. They are cases No.:
00-14665-CA-31, 03-15006-CA-31, 03-22399-CA-31 and 03-22537-CA-31, of those four
cases three were transferred to the Complex Business Litigation Section 40 by
Order dated December 29, 2006. The cases transferred were cases No.:
03-15006-CA-31, 03-22399-CA-31 and 0322537-CA-31.. A hearing on Defendants PIP
and Jean-Claude Mas' motion to disqualify Plaintiff's counsel was held on
September 11. The Court has not ruled yet.

In November of 2003, Jessica Fischer Schnebel and fifteen other women filed a
Second Amended Consolidated Class Action Complaint against PIP, PIP/USA, Inc.
and III Acquisition Corp. d/b/a PIP America in the Circuit Court of Cook County,
Illinois. The Second Amended Consolidated Class Action Complaint contains counts
alleging product liability, breach of the implied warranties of merchantability
and fitness for a particular purpose, violation of the Illinois Consumer Fraud
Act and a contract claim alleging third-party beneficiary status. On July 31,
2007, a Fourth Amended Complaint was filed by twelve women with Mary Rondoni as
the lead plaintiff. The plaintiffs are no longer seeking class action status.
PIP has denied all material allegations. Unspecified monetary damages, exemplary
damages and attorneys fees and costs are sought. Motions to dismiss filed by PIP
and PIP .America remains pending and discovery is on-going. No trial date has
been scheduled.


                                       24
<PAGE>

                    HERITAGE WORLDWIDE, INC. AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                 March 31, 2008

NOTE 12 - LEGAL CONTINGENCIES (continued)

Our U.S. distributor has tendered this case to PIP, for defense and indemnity
pursuant to the distributor agreement.

In May 2006, the Company was sued in the Nottingham County Court by 28
plaintiffs under the "The Consumer Protection Act" of the United Kingdom. The
plaintiffs alleged that the envelope surrounding their implants, obtained by
their respective surgeons from PIP France, SA, were not resistant enough and
could cause pain and inflammation when they leak. The plaintiffs allege they
should be reimbursed approximately $700,000 in costs and damages. The Company is
expecting to present expert reports to the Notthingham County Court judge in
October 2008.

In February of 2008, PIP was served with a Complaint filed in federal court in
Houston, Texas by seven women alleging product liability related claims. The
lead plaintiff is named Nancy Ewert. PIP has responded to the complaint and
asserted defenses and has filed a motion to dismiss..

Though it is not yet possible to predict the outcome of any of the cases
described above, the Company and its subsidiaries, as applicable, have denied
plaintiffs' allegations and are vigorously defending themselves upon the merits
of each lawsuit and against certification of any class in the Illinois Schnebel
lawsuit, which is the only remaining putative class action.

III Acquisition Corp. d/b/a PIP. America claims indemnification from PIP/USA,
Inc., Poly Implants Protheses, S.A., and Jean-Claude Mas, personally, from
allclaims, including those asserted above. The Company believes the costs
associated with these matters will not have a material adverse impact on the
Company's business, results of operations or financial position. The Company has
recorded a provision of approximately $777,000 at March 31, 2008 in connection
with these matters.


                                       25
<PAGE>

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

Overview

Heritage Worldwide, Inc. (the "Company" or "we") and its subsidiaries develop,
manufacture, and market breast implants worldwide. We ceased making sales in the
U.S. market in May 2000, as a result of changes in FDA regulations. At that
time, the U.S. market represented approximately $4 million, or 40% of our
revenues.

We are in the process of developing new products. We expect to introduce a new
product line of breast implants which is based on titanium coating. We are
completing the planning phase of our European clinical trials and anticipate
that we will market such breast implants in the European Union within 24 months,
although this date may be extended subject to the results of our clinical
trials. We believe that the costs of monitoring the clinical trials will be
approximately $500,000 over this period. We will continue to invest in research
and development to enhance and introduce new and existing products. To meet
these operational costs, we depend upon equity financings, collaborations, and
proceeds from short and long-term debt.

A summary of significant accounting policies is provided in Note 3 to our
consolidated financial statements included in this Form 10-KSB. Management
believes that the application of these policies on a consistent basis enables
the Company to provide useful and reliable financial information about the
Company's operating results and financial condition.

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

Stock-Based Compensation. Prior to January 1, 2006, the Company accounted for
its stock-based compensation plans under the recognition and measurement
provisions of Accounting Principles Board ("APB") Opinion No. 25, Accounting for
Stock Issued to Employees, and related Interpretations, as permitted by SFAS No.
123, Accounting for Stock-Based Compensation. The Company did not recognize
compensation cost related to stock options granted to its employees and
non-employee directors that had an exercise price equal to or above the market
value of the underlying common stock on the date of grant in its condensed
consolidated statement of income prior to January 1, 2006. Effective January 1,
2006, the Company adopted the fair value recognition provisions of SFAS No.
123R, Share-Based Payment, and related interpretations using the
modified-prospective transition method. Under that method, compensation cost
recognized in the third quarter of 2006 includes (a) compensation cost for all
stock-based awards granted prior to, but not yet vested as of January 1, 2006
based on the grant date fair value estimated in accordance with the original
provisions of SFAS No. 123 and (b) compensation cost for all stock-based awards
granted on or subsequent to January 1, 2006, based on the grant-date fair value
estimated in accordance with the provisions of SFAS No. 123R. Results for prior
periods have not been restated. Prior to the adoption of SFAS No. 123R, the
Company did not recognize any tax benefits from deductions resulting from the
exercise of stock options as operating cash flows in its statement of cash
flows, because no options have ever been exercised. SFAS No. 123R requires that
the portion of benefits resulting from tax deductions in excess of recognized
compensation (the "excess tax benefits") be presented as financing cash flows.

Revenues. We recognize product revenue, net of estimated sales discounts and
returns and allowances, in accordance with Staff Accounting Bulletin No. 104,
"Revenue Recognition in Financial Statements" and SFAS No. 48 "Revenue
Recognition When Right of Return Exists." These statements established that
revenue can be recognized when persuasive evidence of an arrangement exists, the
product has been shipped, all significant contractual obligations have been
satisfied, the fee is fixed or determinable and collection is reasonably
assured.

As of March 31, 2008, we did not have any outstanding bill and hold
arrangements. From time to time, we entered into such bill and hold arrangements
if they meet the following criteria for revenue recognition:


                                       26
<PAGE>

     o    The risks of ownership passed to the buyer;
     o    The customer made a fixed commitment to purchase the breast implants,
          in writing;
     o    The buyer, not us, requested that the transaction be on a bill and
          hold basis. The buyer had a substantial business purpose for ordering
          the goods on a bill and hold basis-primarily its on lack of
          warehousing space;
     o    There is a fixed schedule for delivery of the goods. The date for
          delivery are reasonable and are consistent with the buyer's business
          purpose;
     o    We did not retain any specific performance obligations such that the
          earning process is not complete;
     o    The ordered breast implants were segregated from our inventory and
          were not subject to being used to fill other orders;
     o    The breast implants were complete and ready for shipment;
     o    The date by which we expect payment was not modified and we have not
          modified our normal billing and credit terms for this buyer;
     o    Our past experiences with and pattern of bill and hold transactions;
     o    The buyer has the expected risk of loss in the event of a decline in
          the market value of the breast implants;
     o    Our custodial risks are insurable and insured; and
     o    The business reasons for the bill and hold have not introduced a
          contingency to the buyer's commitment.

Accounts receivables and related allowance for doubtful accounts. Accounts
receivable are reported at net realizable value. We have established an
allowance for doubtful accounts based upon factors pertaining to the credit risk
of specific customers, historical trends, and other information. Delinquent
accounts are written-off when it is determined that the amounts are
uncollectible.

Inventories. Inventories are stated at the lower of cost or market, cost
determined by the first-in, first-out (FIFO) method. The Company writes down its
inventory for estimated obsolescence or unmarketable inventory equal to the
difference between the cost of inventory and the estimated market value based
upon assumptions about future demand and market conditions

Goodwill. At March 31, 2008, we had approximately $1.2 million in indefinite
lived goodwill related to our acquisition of our subsidiary in Spain. We
evaluate goodwill based on the future contributing margins of such subsidiary.
We use judgment in assessing goodwill for impairment. Goodwill is reviewed for
impairment annually, or sooner if events or changes in circumstances indicate
that the carrying amount could exceed fair value. Fair values are based on
discounted cash flows using a discount rate determined by our management to be
consistent with industry discount rates and the risks inherent in our current
business model. In accordance with SFAS No. 142, we completed the required
impairment tests of goodwill at the date of adoption and annually as required.
There were no impairment charges recorded as a result of the adoption of SFAS
No. 142 or annual impairment tests. Due to uncertain market conditions and
potential changes in our strategy and product portfolio, it is possible that the
forecasts we use to support our goodwill could change in the future, which could
result in non-cash charges that would adversely affect our results of operations
and financial condition.

Deferred Tax Assets. We are required to estimate our income taxes in each of the
jurisdictions in which we operate as part of the process of preparing our
consolidated financial statements. At March 31, 2008, the Company has no net
deferred tax assets. SFAS No. 109, Accounting for Income Taxes, requires a
valuation allowance to reduce the deferred tax assets reported if, based on the
weight of the evidence, it is not more likely than not that some portion or all
of the deferred tax assets will be realized. Management reviews deferred tax
assets periodically for recoverability and makes estimates and judgments
regarding the expected geographic sources of taxable income, gains from
investments, as well as tax planning strategies in assessing the need for a
valuation allowance. We determined that a valuation allowance of approximately
$1,640,000 relating to foreign tax net operating loss carryovers was necessary
to reduce our deferred tax assets to the amount that will more likely than not
be realized. If the estimates and assumptions used in our determination change
in the future, we could be required to revise our estimates of the valuation
allowances against our deferred tax assets and adjust our provisions for
additional income taxes. In the ordinary course of global business, there are
transactions for which the ultimate tax outcome is uncertain, thus judgment is


                                       27
<PAGE>

required in determining the worldwide provision for income taxes. We provide for
income taxes on transactions based on our estimate of the probable liability. We
adjust our provision as appropriate for changes that impact our underlying
judgments. Changes that impact provision estimates include such items as
jurisdictional interpretations on tax filing positions based on the results of
tax audits and general tax authority rulings. Due to the evolving nature of tax
rules combined with the large number of jurisdictions in which we operate, it is
possible that our estimates of our tax liability and the realization of our
deferred tax assets could change in the future, which may result in additional
tax liabilities and adversely affect our results of operations, financial
condition and cash flows.

Product replacements. We provide a product replacement program on our products.
Management estimated the amount of potential future product replacement claims
based on statistical analysis. Expected future obligations are determined based
on the history of product shipments and claims and are discounted to a current
value. Changes to actual claims and interest rates could have a material impact
on the statistical calculation which could materially impact the Company's
reported expenses and results of operations.

RESULTS OF OPERATIONS

<TABLE>
<S>     <C>
                                CONSOLIDATED STATEMENTS OF OPERATIONS

                                           For the nine-month period      Increase/       Increase/
                                                ended March 31,           (Decrease)      (Decrease)
                                         ----------------------------    2008 vs 2007    2008 vs 2007
                                             2008            2007             $                %
                                         ------------    ------------    ------------    ------------
                                          (Unaudited)     (Unaudited)

Revenues                                 $ 13,056,383    $ 10,958,343    $  2,098,040            19.1%

Cost of revenues                            6,098,886       5,277,126         821,760            15.6%
                                         ------------    ------------    ------------    ------------

     Gross margin                           6,957,497       5,681,217       1,276,280            22.5%
                                         ------------    ------------    ------------    ------------

Operating expenses:
  Selling, general and administrative       7,197,233       5,121,221       2,076,012            40.5%
  Research and development                    886,429         919,017         (32,588)           -3.5%
                                         ------------    ------------    ------------    ------------

     Total operating expenses               8,083,662       6,040,238       2,043,424            33.8%
                                         ------------    ------------    ------------    ------------

Loss before other expenses and
Operating (loss) income                    (1,126,165)       (359,021)       (767,144)          213.7%
                                         ------------    ------------    ------------    ------------

Other expenses:
  Gain in equity investment                    39,287          50,894         (11,607)          -22.8%
  Interest expense-related party              (66,988)       (147,700)        (80,712)          -54.6%
  Interest expense                           (393,591)       (274,464)        119,127            43.4%
                                         ------------    ------------    ------------    ------------

     Total other expenses                    (421,292)       (371,270)         50,022            13.5%
                                         ------------    ------------    ------------    ------------

(Loss) income before minority interest     (1,547,457)       (730,291)        817,166           111.9%
                                         ------------    ------------    ------------    ------------

Minority interest                              42,886         (13,595)         56,481              NM
                                         ------------    ------------    ------------    ------------

Net (loss) income                        $ (1,504,571)   $   (743,886)   $    760,685           102.3%
                                         ============    ============    ============    ============

NM: not meaningful
</TABLE>

                                       28
<PAGE>

Nine months Ended March 31, 2008 Compared with Nine months Ended March 31, 2007

   Revenues

Revenues consist primarily of the sale of breast implants and other body support
products. The increase in revenues during the nine-month period ended March 31,
2008 when compared to the prior year period is primarily attributable to
increased volume of breast implants sold to distributors in Latin America and in
Europe.

   Cost of Revenues

Cost of revenues consists primarily of materials and direct labor expenses
associated with the production of breast implants. The increase in costs of
revenues during the nine-month period ended March 31, 2008 is primarily
attributable to an increase in volume of product sold.

   Selling and General Administrative Expenses

Selling, general and administrative expenses consist primarily of compensation
and related benefits of sales representatives which market our products, general
and administrative staff used to support our operations, as well as
facilities-related expenses, professional fees and provision for bad debts. The
increase in selling, general and administrative expenses during the nine-month
period ended March 31, 2008 when compared to the prior year comparable period is
primarily attributable to the following factors:

     o    Increased professional and legal fees related to certain corporate
          activities as well as legal fees incurred in connection with legal
          proceedings in the United Kingdom during the nine-month period ended
          March 31, 2008. Such corporate activities and legal proceedings did
          not occur during the nine-month period ended March 31, 2007.
     o    Increased sales and marketing expenses associated with the development
          of new distribution channels outside of France.
     o    Higher local currency rate. A substantial portion of our sales,
          general, and administrative expenses are incurred in Euros, which
          appreciated by approximately 14% during the nine-month period ended
          March 31, 2008 when compared to the nine-month period ended March 31,
          2007.

   Research and Development

Research and development expenses primarily consist of compensation and related
benefits of personnel associated with the development and introduction of
existing and future product lines. The decrease in research and development
expenses during the nine-month period ended March 31, 2008 is primarily due to a
reduction of personnel used in connection with the development of new products
and the enhancement of existing products.

   Interest Expense

Interest expense consists primarily of amortization of debt discount associated
with the issuance of convertible debentures and interest expense associated with
our lines of credit and other long-term debt. The interest expense during the
nine-month period ended March 31, 2008 is at comparable level to those incurred
during the prior year period.


                                       29
<PAGE>

Liquidity and Capital Resources

At March 31, 2008, our cash amounted to approximately $151,000 and our working
capital amounted to approximately $505,000.

During the nine-month period ended March 31, 2008, we used cash from our
operating activities amounting to approximately $433,000. Our cash used in
operating activities was comprised of our net loss of approximately $1,552,000
adjusted for the following:

     o    Debt discount of approximately $335,000;
     o    Depreciation and amortization of approximately $602,000;
     o    Fair value of options of approximately $69,000;
     o    Provision for doubtful accounts of approximately $175,000; and
     o    Provision for returns of approximately $50,000;

Additionally, the following variations in operating assets and liabilities
impacted our cash used in operating activity:

     o    Decrease in accounts receivable of approximately $322,000 due to
          larger collection efforts implemented in the second quarter of fiscal
          2008; and
     o    Increase in inventory of approximately $201,000 to meet the
          anticipated increase in demand of our products; Increase in prepaid
          assets and other current assets of $221,000, resulting from increased
          research tax credit receivable Increase in accounts payable and
          accrued expenses of approximately $286,000;

During the nine-month period ended March 31, 2008 we purchased property and
equipment of approximately $165,000.

During the nine-month period ended March 31, 2008, we financed our operations,
investing activities and the principal repayment of long-term debt of $227,000
and capitalized lease obligations of $199,000 by securing financing of
approximately $801,000 in long-term debt and by increasing the use of our lines
of credit by approximately $98,000.

During the nine-month period ended March 31, 2007, we used cash in operating
activities amounting to approximately $774,000. Our cash used in operating
activities was comprised of our net loss of approximately $744,000 adjusted for
the following:

     o    Debt discount of approximately $365,000;
     o    Depreciation and amortization of approximately $499,000;
     o    Fair value of options of approximately $324,000;
          Provision for obsolescence of $102,000
     o    Provision for returns of approximately $92,000;

Additionally, the following variations in operating assets and liabilities
impacted our cash used in operating activitiees:

     o    Decrease in accounts receivable of approximately $127,000 due to
          higher rate of collection during the nine-month period ended March 31,
          2007;
     o    Increase in inventories of approximately $483,000 due to increased
          production to meet anticipated demand;
     o    Decrease in current other assets of approximately $195,000;
     o    Decrease in accounts payable and accrued expenses of approximately
          $764,000;


                                       30
<PAGE>

During the nine-month period ended March 31, 2007, we purchased property and
equipment of approximately $259,000.

During the nine-month period ended March 31, 2007, we generated cash from
financing activities of approximately $674,000, which primarily consisted of the
proceeds from issuance of long-term debt amounting to approximately $183,000 and
a higher usage of our lines of credit of approximately $735,000, offset by the
repayment of long-term debt, and capitalized lease obligations of approximately
$254,000 and $70,000.

New Accounting Pronouncements

In September 2006, the FASB issued FASB Statement No. 157. This Statement
defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles (GAAP), and expands disclosures about
fair value measurements. This Statement applies under other accounting
pronouncements that require or permit fair value measurements, the Board having
previously concluded in those accounting pronouncements that fair value is a
relevant measurement attribute. Accordingly, this Statement does not require any
new fair value measurements. However, for some entities, the application of this
Statement will change current practices. This Statement is effective for
financial statements for fiscal years beginning after November 15, 2007. Earlier
application is permitted provided that the reporting entity has not yet issued
financial statements for that fiscal year. Management believes that, for the
foreseeable future, this Statement will have no impact on the financial
statements of the Company once adopted.

In February 2007, the FASB issued FASB Statement 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. The objective is to
improve financial reporting by providing entities with the opportunity to
mitigate volatility in reported earnings caused by measuring related assets and
liabilities differently without having to apply complex hedge accounting
provisions. This Statement is expected to expand the use of fair value
measurement, which is consistent with the FASB's long-term measurement
objectives for accounting for financial instruments. This Statement applies to
all entities, including not-for-profit organizations. Most of the provisions of
this Statement apply only to entities that elect the fair value option.

However, the amendment to FASB Statement No. 115, "Accounting for Certain
Investments in Debt and Equity Securities," applies to all entities with
available-for-sale and trading securities. Some requirements apply differently
to entities that do not report net income. The following are eligible items for
the measurement option established by this Statement:

     1.   Recognized financial assets and financial liabilities except:

          a)   An investment in a subsidiary that the entity is required to
               consolidate;
          b)   An interest in a variable interest entity that the entity is
               required to consolidate;
          c)   Employers' and plans' obligations (or assets representing net
               overfunded positions) for pension benefits, other postretirement
               benefits (including health care and life insurance benefits),
               postemployment benefits, employee stock option and stock purchase
               plans, and other forms of deferred compensation arrangements, as
               defined in FASB Statements No. 35, "Accounting and Reporting by
               Defined Benefit Pension Plans", No. 87, "Employers' Accounting
               for Pensions", No. 106, "Employers' Accounting for Postretirement
               Benefits Other Than Pensions", No. 112, "Employers' Accounting
               for Postemployment Benefits", No. 123 (revised December 2004),
               "Share-Based Payment", No. 43, "Accounting for Compensated
               Absences", No. 146, "Accounting for Costs Associated with Exit or
               Disposal Activities", and No. 158, "Employers' Accounting for
               Defined Benefit Pension and Other Postretirement Plans", and APB
               Opinion No. 12, "Omnibus Opinion--1967";


                                       31
<PAGE>

          d)   Financial assets and financial liabilities recognized under
               leases as defined in FASB Statement No. 13, "Accounting for
               Leases" (This exception does not apply to a guarantee of a
               third-party lease obligation or a contingent obligation arising
               from a cancelled lease.);
          e)   Deposit liabilities, withdrawable on demand, of banks, savings
               and loan associations, credit unions, and other similar
               depository institutions;
          f)   Financial instruments that are, in whole or in part, classified
               by the issuer as a component of shareholder's equity (including
               "temporary equity"). An example is a convertible debt security
               with a noncontingent beneficial conversion feature.
     2.   Firm commitments that would otherwise not be recognized at inception
          and that involve only financial instruments;
     3.   Nonfinancial insurance contracts and warranties that the insurer can
          settle by paying a third party to provide those goods or services; and
     4.   Host financial instruments resulting from separation of an embedded
          nonfinancial derivative instrument from a nonfinancial hybrid
          instrument.

The fair value option established by this Statement permits all entities to
choose to measure eligible items at fair value at specified election dates. A
business entity shall report unrealized gains and losses on items for which the
fair value option has been elected in earnings (or another performance indicator
if the business entity does not report earnings) at each subsequent reporting
date. A not-for-profit organization shall report unrealized gains and losses in
its statement of activities or similar statement.

The fair value option:

     o    May be applied instrument by instrument, with a few exceptions, such
          as investments otherwise accounted for by the equity method
     o    Is irrevocable (unless a new election date occurs)
     o    Is applied only to entire instruments and not to portions of
          instruments.

This Statement is effective as of the beginning of an entity's first fiscal year
that begins after November 15, 2007. Early adoption is permitted as of the
beginning of a fiscal year that begins on or before November 15, 2007, provided
the entity also elects to apply the provisions of FASB Statement No. 157, "Fair
Value Measurements". No entity is permitted to apply this Statement
retrospectively to fiscal years preceding the effective date unless the entity
chooses early adoption. The choice to adopt early should be made after issuance
of this Statement but within 120 days of the beginning of the fiscal year of
adoption, provided the entity has not yet issued financial statements, including
required notes to those financial statements, for any interim period of the
fiscal year of adoption. This Statement permits application to eligible items
existing at the effective date (or early adoption date).

The FASB issued FASB Statement No. 141 (revised 2007), Business Combinations,
and No. 160, Noncontrolling Interests in Consolidated Financial Statements.
Statement 141(R requires the acquiring entity in a business combination to
recognize all (and only) the assets acquired and liabilities assumed in the
transaction; establishes the acquisition-date fair value as the measurement
objective for all assets acquired and liabilities assumed; and requires the
acquirer to disclose to investors and other users all of the information they
need to evaluate and understand the nature and financial effect of the business
combination. FASB No.141 R is effective for fiscal years beginning after
December 15, 2008. The Company does not believe that FAS No. 141 R will have any
impact on its financial statements.


                                       32
<PAGE>

The FASB issued FASB Statement No. 160, Noncontrolling Interests in Consolidated
Financial Statements Statement No.160 requires all entities to report
noncontrolling (minority) interests in subsidiaries in the same way--as equity
in the consolidated financial statements. Moreover, Statement 160 eliminates the
diversity that currently exists in accounting for transactions between an entity
and noncontrolling interests by requiring they be treated as equity
transactions. FASB No.160 is effective for fiscal years beginning after December
15, 2008. The Company does not believe that FAS No. 160 will have any impact on
its financial statements.

In March 2008, the FASB FASB No. 161, Disclosures about Derivative Instruments
and Hedging Activities, an amendment of FASB Statement No. 133, which requires
additional disclosures about the objectives of the derivative instruments and
hedging activities, the method of accounting for such instruments under SFAS No.
133 and its related interpretations, and a tabular disclosure of the effects of
such instruments and related hedged items on our financial position, financial
performance, and cash flows. SFAS No. 161 is effective for the Company beginning
January 1, 2009. Management believes that, for the foreseeable future, this
Statement will have no impact on the financial statements of the Company once
adopted.

Other accounting standards that have been issued or proposed by the FASB or
other standards-setting bodies that do not require adoption until a future date
are not expected to have a material impact on the consolidated financial
statements upon adoption.

ITEM 3. CONTROLS AND PROCEDURES

     Our principal executive officer and our principal financial officer
evaluated the effectiveness of our disclosure controls and procedures (as
defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of
1934, as amended) as of the end of the period covered by this report
("Evaluation Date"). Based on this evaluation, our principal executive officer
and our principal financial officer have concluded that, as of the Evaluation
Date, our controls and procedures are effective in providing reasonable
assurance that the information required to be disclosed in this report has been
recorded, processed, summarized and reported as of the period covered by this
report.

     There was no change in our internal control over financial reporting (as
defined in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act of
1934, as amended) identified in connection with the evaluation of our internal
controls that occurred during our last fiscal quarter that has materially
affected, or is reasonably likely to materially affect, such controls.


                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

In February of 2008, PIP was served with a Complaint filed in federal court in
Houston, Texas by seven women alleging product liability related claims. The
lead plaintiff is named Nancy Ewert. PIP has responded to the Complaint and has
filed a motion to dismiss. No ruling has been received to date.

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

None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None


                                       33
<PAGE>

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS

     (a)  Exhibits

     Exhibit No.    Description
     -----------    -----------

     31.1           Certification of Chief Executive Officer pursuant to Section
                    302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
     31.2           Certification of Chief Financial Officer pursuant to Section
                    302 of the Sarbanes-Oxley Act of 2002. Filed herewith.
     32.1           Certification of Chief Executive Officer pursuant to 18
                    U.S.C Section 1350. Filed Herewith
     32.2           Certification of Chief Financial Officer pursuant to 18
                    U.S.C Section 1350. Filed Herewith.




                                       34
<PAGE>

                                   SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                        HERITAGE WORLDWIDE, INC.
                                            (Registrant)

Date:  May 20, 2008                     By: /s/ Jean Claude Mas
                                            -----------------------
                                                Jean Claude Mas
                                                Chairman of the Board and Chief
                                                Executive Officer
                                                (Principal Executive Officer)

                                        By: /s/ Claude Couty
                                            -----------------------
                                                Claude Couty
                                                Chief Financial Officer and
                                                General Manager
                                                (Principal Financial and
                                                Accounting Officer)


                                       35