U.S. Securities and Exchange Commission
                             Washington, D.C. 20549

                                   Form 10-QSB

                                   (Mark One)
             [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 2001.

            [ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
                                  EXCHANGE ACT

                       For the transition period from to

                        Commission file number 000-31779

                               Hipstyle.com, Inc.
                      (Exact name of small business issuer
                          as specified in its charter)

                                    Florida
                        (State or other jurisdiction of
                         incorporation or organization)


                                   65-0928369
                        (IRS Employer Identification No.)

                1221 Brickell Avenue, Suite 900, Miami, FL 33131
                    (Address of principal executive offices)

                                 (305) 539-0900
                           (Issuer's telephone number)

                                 Not Applicable

              (Former name, former address and former fiscal year,
                          if changed since last report)

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

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                   PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes   No

The number of shares of common stock $.0001 par value, of the Registrant issued
and outstanding as of November 15, 2001 was 4,600,000.

                                       1
<PAGE>

                               HIPSTYLE.COM, INC.

                                   FORM 10QSB

                         PERIOD ENDED SEPTEMBER 30, 2001

                         Index to Financial Statements
                               Hipstyle.com, Inc.

<TABLE>
<S>                                                 <C>
Accountant's Report                                 1

Balance sheets                                      2

Statements of operations                            3

Statements of changes in stockholders' equity       4

Statements of cash flows                            5 - 6

Notes to financial statements                       7 - 16

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

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

Item 2.  Changes in Securities.

Item 3.  Defaults Upon Senior Securities.

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

Item 5.  Other Information

Item 6. Exhibits and Reports of Form 8-K. None

Signatures
</TABLE>

<PAGE>

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements:

BASIS OF PRESENTATION

The accompanying unaudited financial statements are presented in accordance with
generally accepted accounting principles for interim financial information and
the instructions to Form 10-QSB and item 310 under subpart A of Regulation S-B.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
The accompanying statements should be read in conjunction with the audited
financial statements for the year ended June 30, 2001. In the opinion of
management, all adjustments (consisting only of normal occurring accruals)
considered necessary in order to make the financial statements not misleading,
have been included. Operating results for the three months ended September 30,
2001 are not necessarily indicative of results that may be expected for the year
ending June 30, 2001. The financial statements are presented on the accrual
basis.

<PAGE>

                       HIPSTYLE.COM, INC. AND SUBSIDIARY

                         (A DEVELOPMENT STAGE COMPANY)

                              FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2001 AND JUNE 30, 2001 AND FOR THE THREE MONTH PERIOS ENDED
 SEPTEMBEPER 30, 2001 AND 2000, AND FOR THE PERIOD FROM JUNE 22, 1999 (DATE OF
                     INCEPTION) THROUGH SEPTEMBER 30, 2001


<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
<TABLE>
<CAPTION>
TABLE OF CONTENTS                                                                   Page
<S>                                                                                 <C>
INDEPENDENT AUDITORS' REPORT                                                          1

FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 2001 AND JUNE 30, 2001 AND FOR THE
THREE MONTH PERIODS SEPTEMBER 30, 2001 AND 2000, AND FOR THE PERIOD JUNE 22,
1999 (DATE OF INCEPTION) THROUGH SEPTEMBER 30, 2001

Balance sheets                                                                        2

Statements of operations                                                              3

Statements of changes in stockholders' equity                                         4

Statements of cash flows                                                            5 - 6

Notes to financial statements                                                       7 - 16
</TABLE>


<PAGE>

                          INDEPENDENT AUDITORS REPORT

To the Stockholders and
Board of Directors

Hipstyle.com, Inc. and subsidiary
(A Development Stage Company)
Miami, Florida

We have audited the accompanying balance sheets of Hipstyle.com, Inc. (a
development stage company) as of June 30, 2001 and the related statement of
operations, change in stockholders' equity and cash flow for the year ended June
30, 2001. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit. The financial statements of Hipstyle.com, Inc. as
of June 30, 2000 were audited by other auditors whose report dated September 5,
2000, expressed an unqualified opinion on those statements.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe the audit provides a reasonable
basis for our opinion.

In our opinion, the financial statement referred to above present fairly, in all
material respects, the financial position of Hipstyle.com, Inc. as of June 30,
2001 and the result of its operation and its cash flow for the year ended June
30, 2001 in conformity with accounting principles generally accepted in the
United States of America.

The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 4 to the financial
statements, the Company is a development stage company. The realization of a
major portion of its assets is dependent upon its ability to meet its future
financing requirements, and the success of future operations. These factors
raise substantial doubt about the Company's ability to continue as a going
concern. The financial statements do not include any adjustments that might
result from this uncertainty.

Salibello & Broder LLP
New York, NY

August 23, 2001

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                              (UNAUDITED)
ASSETS                                                                     SEPTEMBER 30, 2001    JUNE 30, 2001
                                                                         --------------------    --------------
<S>                                                                            <C>                    <C>
CURRENT ASSETS:
Cash                                                                               $ 14                  $ 275
                                                                         ---------------         --------------
                 Total current assets                                                14                    275

TOTAL ASSETS                                                                       $ 14                  $ 275
                                                                         ===============         ==============

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:

Accounts payable & accrued expenses                                            $ 40,302               $ 21,474
Loans and advances payable - related party                                          500                    500
Notes payable - related party                                                     7,000                  6,000
                                                                         ---------------         --------------
                 Total current liabilities                                       47,802                 27,974

STOCKHOLDERS' EQUITY:

Common stock, par value $.0001 per share; 100,000,000 shares authorized
  4,600,000 and 4,050,000 shares issued and

  outstanding at September 30, 2001 and June 30, 2001, respectively                 460                    460
Additional paid-in capital                                                      119,740                119,740
Deficit accumulated during the development stage                               (167,988)              (147,899)
                                                                         ---------------         --------------

                 Total Stockholders' equity                                     (47,788)               (27,699)
                                                                         ---------------         --------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)                               $ 14                  $ 275
                                                                         ===============         ==============
</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                      -2-

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                                                                  (UNAUDITED)
                                                            (UNAUDITED)                         FOR THE PERIOD
                                                          THREE MONTHS ENDED                    JUNE 22, 1999
                                                            SEPTEMBER 30,                    (DATE OF INCEPTION) TO
                                                    2001                     2000              SEPTEMBER 30, 2001
                                                    ----                     ----              ------------------
<S>                                             <C>                    <C>                        <C>
DEVELOPMENT STAGE REVENUES                      $            0         $             0            $          0
                                                --------------         ---------------            ------------

DEVELOPMENT STAGE EXPENSES:

       Amortization                                         0                    1,357                   1,807
       Accounting                                       8,020                    4,000                  33,523
       Bank charges                                        82                       90                     377
       Consulting fees                                      0                        0                  10,200
       Dues & subscription                                 75                       55                     368
       Licenses and taxes                                   0                        0                   1,673
       Office expenses                                  6,000                    6,000                  30,000
       On-line services                                   135                       90                     630
       Legal fees                                       4,395                      737                  29,551
       Postage                                              0                       81                     267
       Printing                                             0                        0                     315
       Website development fees                             0                   25,328                  52,485
       Shareholder related services                     1,217                        0                   3,538
       Travel                                               0                      281                   2,988
                                                --------------           --------------           -------------

TOTAL DEVELOPMENT STAGE EXPENSES                       19,924                   38,019                 167,722
                                                --------------           --------------           -------------

       LOSS FROM OPERATIONS                           (19,924)                 (38,019)               (167,722)

INTEREST EXPENSE                                         (165)                       0                    (266)
                                                --------------           --------------           -------------

NET LOSS                                            $ (20,089)               $ (38,019)              $(167,988)
                                                ==============           ==============           =============

LOSS PER COMMON SHARE
       Basic & diluted                                $ (0.00)                 $ (0.01)
                                                ==============           ==============

Weighted-average common shares outstanding          4,600,000                4,460,489
                                                ==============           ==============
</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                      -3-

<PAGE>

HIPSTYLE.COM, INC
(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>
                                                                                                                DEFICIT
                                                                                                                ACCUMULATED
                                                                                                 ADDITIONAL     DURING THE
                                                                       COMMON STOCK              PAID-IN-       DEVELOPMENT
                                                                   SHARES        AMOUNT          CAPITAL        STAGE        TOTAL
                                                                   ------        ------          -------        -----        -----
<S>                                                                <C>             <C>          <C>         <C>           <C>
Balance, June 22, 1999 (date of inception)                                 0     $   0        $       0    $       0    $       0

Restricted common stock issued to related parties
 for consulting fees                                               4,000,000       400             (200)           0          200

Deficit accumulated during the development stage for the
  period June 22, 1999 (date of inception) through June 30, 1999           0         0                0         (200)        (200)
                                                                   ---------     -----        ---------    ---------    ---------

Balance, June 30, 1999                                             4,000,000       400             (200)        (200)           0

Restricted common stock issued to related party for
 consulting services                                                  50,000         5            9,995            0       10,000

Deficit accumulated during development stage
 for the year ended June 30, 2000                                          0         0                0      (56,397)     (56,397)
                                                                   ---------     -----        ---------    ---------    ---------

Balance, June 30, 2000                                             4,050,000       405            9,795      (56,597)     (46,397)

Common stock issued to third parties in private offering             550,000        55          109,945            0      110,000

Deficit accumulated during the development stage
 for the year ended June 30, 2001                                          0         0                0      (91,302)     (91,302)
                                                                   ---------     -----        ---------    ---------    ---------

Balance, June 30, 2001                                             4,600,000     $ 460        $ 119,740    $(147,899)   $ (27,699)

Deficit accumulated during the development stage
for the three months ended September 30, 2001                              0         0                0      (20,089)     (20,089)
                                                                   ---------     -----        ---------    ---------    ---------

Balance, September 30, 2001                                        4,600,000       460          119,740     (167,988)     (47,788)
                                                                   =========     =====        =========    =========    =========
</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                      -4-

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                       (UNAUDITED)                              (UNAUDITED)
                                                                    THREE MONTHS ENDED                        FOR THE PERIOD
                                                                       SEPTEMBER 30,                          JUNE 22, 1999
                                                                       -------------                      (DATE OF INCEPTION) TO
                                                                2001                   2000                  SEPTEMBER 30, 2001
                                                          -----------------       ----------------      --------------------------
CASH FLOWS FROM OPERATING ACTIVITES:
<S>                                                                <C>                    <C>                  <C>
Net loss                                                           (20,089)               (38,019)             (167,988)

Adjustments to reconcile net loss to net cash used by operations:

 Amortization/ Depreciation                                              0                  1,357                 1,807
 Write off of website                                                    0                 25,328                25,328
 Stock based expense                                                     0                      0                10,200
 Changes in assets and liabilities:
  Increase (Decrease) in accounts payable

  and accrued expenses                                              18,828                (63,230)               40,302
  Increase (Decrease) in loans and advances -
  related party                                                          0                      0                   500
                                                          -----------------       ----------------      ----------------

              Net cash used by operating activities                 (1,261)               (74,564)              (89,851)

CASH FLOWS FROM INVESTING ACTIVITES:
 Purchase of website                                                     0                      0               (27,135)
                                                          -----------------       ----------------      ----------------

              Net cash used by investing activities                      0                      0               (27,135)

CASH FLOWS FROM FINANCING ACTIVITIES:
 Proceeds from the issuance of common stock                              0                110,000               110,000
 Notes payable -  related party                                      1,000                      0                 7,000
                                                          -----------------       ----------------      ----------------

              Net cash provided by financing activities              1,000                110,000               117,000

INCREASE (DECREASE) IN CASH                                         $ (261)              $ 35,436                  $ 14
                                                          =================       ================      ================

CASH, BEGINNING OF PERIOD                                            $ 275                   $ 55                  $  0
                                                          =================       ================      ================

CASH, END OF PERIOD                                                   $ 14               $ 35,491                  $ 14
                                                          =================       ================      ================
</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                      -5-

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

STATEMENT OF CASH FLOWS

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

During the three months ended September 30, 2001 and 2000, and for the
cumulative periods June 22, 1999 (date of inception) through September 30, 2001,
the Company did not pay any interest.

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVIITES

The Company entered into the following non-cash transactions:

On June 22, 1999 (date of inception) the Company issued 4,000,000 post-split
(see note 8) restricted shares of common stock in consideration for consulting
services provided by Intelilabs.com, Inc. formerly known as Quentin Road
Productions, Inc., the founder of the Company (see note 1). This transaction was
valued at $200.

On May 30, 2000 the Company issued 50,000 restricted shares of the Company's
common stock in exchange for consulting services to the Vice President of the
Company. This transaction was valued at $10,000 (see note 8).

On September 30, 2000 the Company decided to write off the capitalized portion
of the website (See note 5). The assets' net value at the time of impairment was
$25,328.

                                      -6-

<PAGE>

HIPSTYLE.COM, INC
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------


1.   ORGANIZATION

     Hipstyle.com, Inc. ("the Company") was incorporated on June 22, 1999 under
     the laws of the State of Florida and was licensed to do business in the
     state of New York. The Company is in the process of designing a website
     dedicated to bringing together designers of high fashion and beauty
     products with a targeted client base. The Company's goal is to provide
     links to established e-commerce and catalog retail sites featuring designer
     apparel and accessories, as well as fashion related services and content to
     its viewers.

     The Company was a wholly owned subsidiary of Intellilabs.com, Inc.
     ("Intellilabs"), formerly known as Quentin Road productions, Inc., a
     publicly traded company listed on the OTC Electronic Bulletin Board
     (OTCBB:QRPI) from inception until March 1, 2000. It was spun-off by
     Intellilabs on March 1, 2000. Upon such spin-off, shareholders of
     Intellilabs received 1.31 shares of the Company for each share of
     Intellilabs owned as of March 1, 2000. As a result of the spin-off, Atlas
     Equity Group, Inc., a related party, beneficial owner of which is Michael
     D. Farkas, became a majority shareholder in the company owning
     approximately 57% of the outstanding shares. Its principal office is
     located at 1221 Brickell Avenue, Suite 900, Miami, FL 33131.

     On May 24, 2000, the Company formed Hipstyle.com, Inc. ("Hipstyle
     Delaware") under the laws of the state of Delaware. Hipstyle Delaware did
     not have any significant activity as of September 30, 2001.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     MANAGEMENT DECISION NOT TO CONSOLIDATE

     Statement of Financial Accounting Standards ("SFAS") No. 94, "Consolidation
     of All Majority Owned Subsidiaries," encourages the use of consolidated
     financial statements between a parent company and its subsidiaries unless:

          a)   Control is likely to be temporary,
          b)   Control does not rest with the majority owner(s), or
          c)   Minority stockholders have certain approval or veto rights that
               allow them to exercise significant control over major management
               decisions in the ordinary course of business.

                                       -7-

<PAGE>

HIPSTYLE.COM, INC
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------

     The management of Atlas Equity Group, Inc., a related party, in which
     Michael D. Farkas is a beneficial owner, believes that its control is
     temporary. Therefore, management believes that separate financial
     statements are appropriate and properly reflect the Company's current
     operating results.

     USE OF ESTIMATES

     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
     disclosures of contingent assets and liabilities as of the date of the
     financial statements. Accordingly, actual results could differ from those
     estimates.

     CASH AND CASH EQUIVALENTS

     For purposes of reporting cash flows, the company considers all highly
     liquid investments purchased with an original maturity of three months or
     less to be cash equivalents.

     INTANGIBLE ASSET - WEBSITE

     Website costs have been capitalized pursuant to EITF 00-2. The website was
     being amortized on the straight-line basis over a period of 60 months. The
     planning and maintenance costs associated with the website were expensed as
     incurred.

     The Company reviews assets for impairment whenever events or changes in
     circumstances indicate the carrying value of the asset may not be
     recoverable. A determination of impairment, if any, is made based on
     estimates of undiscounted future cash flows. On September 30, 2000 the
     Company decided to impair their Website because undiscounted future cash
     flows are uncertain at this time. The assets net value was $25,328 at the
     time of impairment (see note 4).

                                       -8-

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------

     INCOME TAXES

     The Company utilizes Statement of Financial Standards ("SFAS") No. 109,
     "Accounting for Income Taxes", which requires the recognition of deferred
     tax assets and liabilities for the expected future tax consequences of
     events that have been included in financial statements or tax returns.
     Under this method, deferred income taxes are recognized for the tax
     consequences in future years of differences between the tax basis of assets
     and liabilities and their financial reporting amounts at each period end
     based on enacted tax laws and statutory tax rates applicable to the periods
     in which the differences are expected to affect taxable income. Valuation
     allowances are established when necessary to reduce deferred tax assets to
     the amount expected to be realized. The accompanying financial statements
     have no provisions for deferred tax assets or liabilities because the
     deferred tax allowance offsets deferred tax assets in their entirety.

     STOCK COMPENSATION

     Stock-based compensation is recognized using the intrinsic value method
     prescribed in Accounting Principles Board ("APB") Opinion No. 25,
     Accounting for Stock Issued to Employees, and related interpretations.
     Accordingly, compensation expense for stock options is measured as the
     excess, if any, of the fair value of the Company's stock at the date of the
     grant over the amount an employee must pay to acquire the stock and is
     amortized over the vesting period. The Company has adopted the disclosure
     provisions of SFAS No. 123, Accounting for Stock-Based Compensation, which
     requires the Company to disclose the pro forma effects on earnings and
     earnings per share as if SFAS No. 123 had been adopted. This adoption has
     no effect on the Company.

     NET LOSS PER SHARE

     The Company has adopted SFAS No. 128 "Earnings Per Share". Basic loss per
     share is computed by dividing the loss available to common shareholders by
     the weighted-average number of common shares outstanding. Diluted loss per
     share is computed in a manner similar to the basic loss per share, except
     that the weighted-average number of shares outstanding is increased to
     include all common shares, including those with the potential to be issued
     by virtue of warrants, options, convertible debt and other such convertible
     instruments. Diluted earnings per share contemplates a complete conversion
     to common shares of all convertible instruments only if they are dilutive
     in nature with regards to earnings per share. Since the Company has
     incurred losses for all periods, and since there are no convertible
     instruments, basic loss per share and diluted loss per share are the same.

                                       -9-

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------

     FAIR VALUE OF FINANCIAL INSTRUMENTS

     SFAS No. 107 "Disclosures about Fair Value of Financial Instruments"
     requires the disclosure of the fair value of financial instruments. The
     Company's management, using available market information and other
     valuation methods, has determined the estimated fair value amounts.
     However, considerable judgment is required to interpret market data in
     developing estimates of fair value. Accordingly, the estimates presented
     herein are not necessarily indicative of the amounts the Company could
     realize in a current market exchange.

     SEGMENTS

     The Company has adopted the provisions of SFAS No. 131, Disclosures about
     Segments of an Enterprise and Related Information. SFAS No. 131 establishes
     standards for companies to report information about operating segments in
     annual financial statements. It also establishes standards for related
     disclosures about products and services, geographic areas and major
     customers. Since the Company did not have any revenues and or segments
     during the three months ended September 30, 2001 and year ended June 30,
     2001 the provisions of SFAS No. 131 does not have a material effect on
     these financial statements.

3.   RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

     In March, 2000 the FASB issued Interpretation No. 44, "Accounting for
     Certain Transactions Involving Stock Compensation, Interpretation of APB
     Opinion No. 25." Interpretation No. 44 clarifies the application of
     Accounting Principle Board Opinion No. 25 to certain issues including: (1)
     the definition of employee for purposes of applying APB No. 25, (2) the
     criteria for determining whether a plan qualifies as a non-compensatory
     plan, (3) the accounting consequences of various modifications to the terms
     of a previously fixed stock option or award, and (4) the accounting for an
     exchange of stock compensation awards in business combinations. Management
     adopted the application of the fair value method under FASB Statement 123
     and, therefore, this Interpretation does not have a material effect on the
     financial statements.

     In June 2000, the Financial Accounting Standards Board issued SFAS No. 138,
     "Accounting for Derivative Instruments and Hedging Activities - An
     Amendment of FASB Statement No. 133." SFAS 138 amends the accounting and
     reporting standards for certain derivatives and hedging activities such as
     net settlement contracts, foreign currency transactions and inter company
     derivatives. The Company does not currently hold derivative instruments or
     engage in hedging activities. The requirements of SFAS 138 does not have a
     material effect on our financial statements and related disclosures.

                                      -10-

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------

4.   DEVELOPMENT STAGE OPERATIONS AND GOING CONCERN MATTERS

     The Company's initial activities have been devoted to developing a business
     plan, negotiating contracts and raising capital for future operations and
     administrative functions.

     The accompanying financial statements have been prepared on a going concern
     basis, which contemplates the realization of assets and the satisfaction of
     liabilities in the normal course of business. As shown in the financial
     statements, development stage losses from June 22, 1999 (date of inception)
     to September 30, 2001, were $167,988. The Company's cash flow requirements
     have been met by contributions of capital and accounts payable.

     The possibility exists that these sources of financing will not continue to
     be available. If the company is unable to generate profits, or unable to
     obtain additional funds for its working capital needs, it may have to cease
     operations.

     The Company intends to meet its long-term liquidity needs through available
     cash as well as through additional financing from outside sources.
     Management believes that the existing working capital in combination with
     additional paid-in capital will be sufficient to fund operations at least
     through October 1, 2001 (see note 8).

     The financial statements do not include any adjustments relating to the
     recoverability and classification of liabilities that might be necessary
     should the Company be unable to continue as a going concern. The Company's
     continuation as a going concern is dependent upon its ability to generate
     sufficient cash flow to meet its obligations on a timely basis, to retain
     additional paid-in capital and to ultimately attain profitability.

5.   INTANGIBLE ASSET - WEBSITE

     The website and related amortization consisted of the following as of
     September 30, 2001 and June 30, 2001:

                                      -11-

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                           September 30, 2001          June 30, 2001
                                                           ------------------          -------------
<S>                                                          <C>                      <C>
         Website                                             $      27,135            $      27,135

         Less:  accumulated amortization                            (1,807)                  (1,807)
                                                             -------------            -------------
                                                                    25,328                   25,328
                                                             -------------            -------------
                          Impairment                               (25,328)                 (25,328)
                                                             -------------            -------------
         Website                                             $           -            $           -
                                                             =============            =============
</TABLE>

     Amortization expense for the three months ended September 30, 2001 and year
     ended June 30, 2000 was $0 and $1,357, respectively. As of September 30,
     2000 Management decided to capitalize the Website based on the Company's
     belief that there will be a future benefit derived from the Website. Also,
     the Company felt that there will be an adequate future inflow of cash
     resulting from common stock being issued to third parties in a private
     offering and future revenue derived from operations of the Website. On
     September 30, 2000 the Company decided to impair the Website due to the
     uncertainty of undiscounted future cash flows and the realization that
     there will not be any future benefit resulting from the development of the
     Website.

6.   INCOME TAXES

     No provisions for income taxes have been made because the Company has
     sustained cumulative losses since the commencement of operations. As of
     September 30, 2001 and June 30, 2001, the Company had net operating loss
     carryforwards ("NOL's") of $167,988 and $147,899, respectively, which will
     be available to reduce future taxable income and expense in the year ending
     December 31 and June 30, 2020 respectively.

     In accordance with SFAS No. 109 the Company has computed the components or
     deferred income taxes as follows.
<TABLE>
<CAPTION>
                                                                 September 30, 2001     June 30, 2001
                                                                 ------------------     -------------
<S>                                                            <C>                      <C>
                Deferred tax assets                            $          66,355        $     58,420
                Valuation allowance                                      (66,355)            (58,420)
                                                               -----------------        ------------
                Deferred tax asset, net                        $               -        $          -
                                                               =================        ============
</TABLE>

     At September 30, 2001 and June 30, 2001, a valuation allowance has been
     provided and realization of the deferred tax benefit is not likely.

                                      -12-

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------

     The effective tax rate varies from the U.S. Federal statutory tax rate for
     both September 30, 2001 and June 30, 2001 respectively, principally due to
     the following:

                 U.S. statutory tax rate                34%
                 State and local taxes                  5.5
                 Valuation                            (39.5)
                                                      -----
                 Effective rate                         - %
                                                      =====

7.   ACCOUNTS PAYABLE & ACCRUED EXPENSES

     Accounts payable and accrued expenses at September 30, 2001 & June 30, 2001
     respectively consisted of the following:
<TABLE>
<CAPTION>
                                                          September 30, 2001       June 30, 2001
                                                          ------------------       -------------
<S>                                                       <C>                      <C>
                  Accounts payable                        $         32,125         $      16,798
                  Accrued interest                                     266                   101
                  Accrued expenses                                   7,911                 4,575
                                                          ----------------         -------------
                                                          $         40,302         $      21,474
                                                          ================         =============
</TABLE>

8.   STOCKHOLDERS' EQUITY

     The Company issued 4,000,000 post-split common shares upon incorporation to
     Intellilabs in exchange for consulting services pertaining to the formation
     of the Company valued at $200. This investor is deemed to be a founder and
     affiliate of the Company. These shares have been adjusted to give
     retroactive effect to a 2,000 to 1 stock split that occurred on January 15,
     2000.

     On January 4, 2000, the Board of Directors amended the Articles of
     Incorporation. The number of authorized shares of common stock was
     increased to 100,000,000. The par value was changed to $0.0001 per share of
     common stock. The financial statements have been retroactively adjusted to
     reflect the effect of this change.

     On January 15, 2000, the Board of Directors authorized a 2,000 to 1 forward
     split of the Company's common stock, par value $0.0001. Subsequent to the
     split there were 4,000,000 issued and outstanding. This transaction has
     been given retroactive effect as if it occurred on June 22, 1999 (date of
     inception).

                                      -13-

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
-------------------------------------------------------------------------------

     On March 1, 2000, the Company entered into an agreement and plan of
     distribution ("spin-off") with Intellilabs. Upon spin-off, the shareholders
     of Intellilabs received 1.31 shares of the Company's common stock for each
     share of Intellilabs owned as of March 1, 2000, totaling 4,000,000 common
     shares. As a result of this spin-off and share distribution Atlas Equity
     Group, Inc., a related party, in which Michael D. Farkas is a beneficial
     owner, received 2,620,000 shares, representing approximately 57% of the
     Company's outstanding common stock and Rebecca J. Farkas (f/k/a Brock)
     received 655,000 shares representing approximately 16% of the Company's
     common stock.

     On May 30, 2000, the Board of Directors authorized the issuance of 50,000
     restricted shares of the Company's common stock in exchange for consulting
     services rendered by the Vice President. These shares were valued at $0.20
     per share due to their restrictive nature and are subject to Rule 144 of
     the SEC Act of 1933 as amended. This transaction was valued at $10,000.

     In June 2000, the Company entered into a private offering of securities
     pursuant to Regulation D, Rule 504, promulgated under the Securities Act of
     1933 as amended. Common shares were offered to non-accredited and
     unaffiliated investors for cash consideration of $0.20 per share. For the
     year ended September 30, 2000, 550,000 unrestricted common shares were
     issued to 22 non-accredited and unaffiliated investors for cash
     consideration totaling $110,000.

     The proceeds from the sale of these securities were received in July and
     August 2000 and have been recorded in the statement of changes in
     stockholders' equity (deficit).

9.   RELATED PARTY TRANSACTIONS

     The Company issued 4,000,000 post-split common shares upon incorporation to
     Intellilabs, the parent company, in exchange for consulting services valued
     at $200. These shares were subsequently distributed to the shareholders of
     Intellilabs. Pursuant to an agreement and plan of distribution.

     On May 30, 2000 the Company issued 50,000 restricted shares of the
     Company's common stock in exchange for consulting services to Michelle
     Brock, a related party, and Vice President of the Company. This transaction
     was valued at $10,000.

                                      -14-

<PAGE>

HIPSTYLE.COM, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
------------------------------------------------------------------------------

     Michael D. Farkas and Rebecca J. Farkas, his wife, an officer and director,
     and a related party loaned the Company $2,488 which covered the cost of the
     license fees to the State of New York and the reservation costs associated
     with reserving the desired internet address and other operating expenses.
     No interest has been charged on these loans and were paid on August 31,
     2000.

     In June 2000, the Company engaged WealthHound, Inc., a subsidiary of
     WealthHound.com, Inc. which is a related party, in which Michael Farkas is
     a 70% owner, to develop and design its website. The Company paid a total of
     $54,292 to WealthHound, Inc. in connection with these services.

     In July 2000, the Company agreed to reimburse Atlas Equity Group, Inc., a
     related party, beneficial owner of which is Michael D. Farkas, $2,000 per
     month (on a month-to-month basis) for operating and administrative
     services.

     In August 2000, the Company engaged OSRS Communications a subsidiary of
     WealthHound.com, Inc., a related party, beneficial owner which is Michael
     Farkas to provide web hosting services for $45 per month on a
     month-to-month basis.

10.  SUBSEQUENT EVENT

     Between October 2001 and November 2001,the Company issued two promissory
     notes to Atlas Equity, Inc., a related party in which Michael D. Farkas is
     a beneficial owner, aggregating $1,300 at a rate of 10% per annum. The
     promissory notes principal amount and accrued interest are due and payable
     on dates ranging from October 2002 and November 2002.

                                      -15-

<PAGE>

Item 2.  Management's Discussion and Analysis

The following plan of operation provides information which management believes
is relevant to an assessment and understanding of our results of operations and
financial condition. The discussion should be read along with our financial
statements and notes thereto. Hipstyle.com, Inc. and subsidiary is a development
- stage company. Because Hipstyle has not generated any revenue, it intends to
report its plan of operation below.

The following discussion and analysis contains forward-looking statements, which
involve risks and uncertainties. The Company's actual results may differ
significantly from the results, expectations and plans discussed in these
forward-looking statements.

The Company's operations have been devoted primarily to developing a business
plan and raising capital for future operations and administrative functions. The
Company intends to grow through internal development, strategic alliances, and
acquisitions of existing businesses. Because of uncertainties surrounding its
development, the Company anticipates incurring development stage losses in the
foreseeable future. The ability of the Company to achieve its business
objectives is contingent upon its success in raising additional capital until
adequate revenues are realized from operations.

PERIOD FROM JUNE 22, 1999 (DATE OF INCEPTION) THROUGH SEPTEMBER 30, 2001

Our cumulative net losses since the inception are attributable to the fact that
we have not derived any revenue from operations to offset our business
development expenses.

Operating expenses since inception have amounted to $167,988, primarily
consisting of accounting ($33,523), consulting ($10,200), office ($30,000),
legal ($29,551), and web site development fees ($52,485). Accounting,
consulting, and legal expenses are in connection with its Form 10 quarterly and
annual filings. Included in office expenses are administrative services
performed by a related party. Website expense incurred in connection with
management's decision to impair their capitalized asset because undiscounted
future cash flow is uncertain and the future benefit of the website is
undeterminable.

FOR THE YEARS ENDED JUNE 30, 2001 AND JUNE 30, 2000

Development stage expenses during the years ended June 30, 2001 were $91,302 as
compared to $51,397 for the period ended June 30, 2000.

Expenses for the year ended June 30, 2001 were primarily consisting of
accounting ($12,503), legal ($20,675), office expenses ($24,000) and website
development fees ($25,328). The accounting, consulting and legal expenses were
in connection with its Form 10 filing and in its pursuit of the Company's
objectives, as well as professional fees incurred in connection with the
Company's annual and quarterly regulatory filings. Office expenses are
administrative services performed by a related party. Website expenses resulted
from management's decision to impair their capitalized asset because
undiscounted future cash flow is uncertain and the future benefit of the website
is undeterminable.

<PAGE>

Item 2.  Management's Discussion and Analysis (cont'd)

Expenses for the year ended June 30, 2000 were $56,397 primarily consisting of
accounting ($13,000), consulting ($10,000), legal ($4,481), and web site
development fees ($27,158). The accounting, consulting, and legal expenses are
in connection with its quarterly and annual Form 10 filings.

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001 AND SEPTEMBER 30, 2000

Development stage expenses for the three months ended September 30, 2001 was
$20,089 as compared to expenses of $38,019 for the three months ended September
30, 2000.

Expenses for the three months ended September 30, 2001 were primarily accounting
($8,020), legal ($4,395) and office expenses ($6,000). These fees are related to
the Company's quarterly and annual filings along with administrative services
performed on behalf of the Company.

Expenses for the three months ended September 30, 2000 were primarily accounting
($4,000), legal ($737) and office expenses ($6,000). These fees are related to
the Company's quarterly filings along with administrative services performed on
behalf of the Company. The Company also decided to impair its capitalized
Website ($25,328).

Liquidity and Capital Resources

Despite capital contributions and both related party and third party loan
commitments, the company from time to time experienced, and continues to
experience, cash flow shortages that have slowed the Company's growth.

The Company has primarily financed its activities from sales of capital stock of
the Company and from loans from related and third parties. A significant portion
of the funds raised from the sale of capital stock has been used to cover
working capital needs such as office expenses and various consulting fees.

For the three months ended September 30, 2000, we incurred a net loss of
$20,089. Our accumulated deficit since inception is $167,988. Such accumulated
losses have resulted primarily from costs incurred in the development of our
website and various professional fees.

The Company continues to experience cash flow shortages, and anticipates this
continuing through the foreseeable future. Management believes that additional
funding will be necessary in order for it to continue as a going concern. The
Company is investigating several forms of private debt and/or equity financing,
although there can be no assurances that the Company will be successful in
procuring such financing or that it will be available on terms acceptable to the
Company.

<PAGE>

<PAGE>

PART II. - OTHER INFORMATION

Item 1.  LEGAL PROCEEDINGS
         Not applicable

Item 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS
         Not applicable

Item 3.  DEFAULTS UPON SENIOR SECURITIES
         Not applicable

Item 4.  SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS
         Not applicable

Item 5.  OTHER INFORMATION
         None

Item 6.  EXHIBITS AND REPORTS OF FORM 8K
         None

                                   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.

                    HIPSTYLE.COM, INC.

                              /s/ Rebecca Farkas
                     ----------------------------------
                                  Rebecca Farkas
                                  President, Treasurer and
                                  Secretary

Date: November 16, 2001

                               /s/ Michelle Brock
                     ----------------------------------
                                   Michelle Brock
                                   Vice President

Date: November 16, 2001