U.S.
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549  FORM 10-K  (Mark One) [X]
ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 For
Fiscal Year Ended: September 30, 2008 OR [
 ]
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________ to _______________ Commission file number:  333-138927 EL PALENQUE VIVERO, INC.(Exact name of registrant as specified in its
charter)Nevada

20-5277531(State or other jurisdiction of incorporation or
organization)

(IRS Employer Identification No.)Privada de Tabasco #27, Colonia MaravillasCuernavaca, Morelos  Mexico

62320(Address of principal executive offices)

(Postal Code) Issuer's telephone number:
 (305) 394-9730 Securities registered under
Section 12(b) of the Act:  None Securities registered under
Section 12(g) of the Act:  None Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [
 ]  No [X] Indicate by
check mark if the registrant is not required to file reports pursuant to Section
13 or 15(d) of the Exchange Act.  Yes [X]  No [  ] Indicate by
check mark whether the registrant (1) has 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 [  ] Indicate by
check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation
S-K is not contained herein, and will not be contained, to the best of
registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  [X] Indicate by check mark whether
the registrant is a large accelerated filer, an accelerated filer, or a smaller
reporting company.  See the definitions of the large accelerated filer,
accelerate filer, and smaller reporting company in Rule 12b-2 of the
Exchange Act.   (Check one): Large
Accelerated Filer [  ] Accelerated
Filer [  ] Non-Accelerated
Filer [  ] Smaller reporting company [X] (Do
not check if a smaller reporting company) Indicate by check mark whether the registrant is a shell
company (as defined in Rule 12b-2 of the Exchange Act). Yes  [X]
   No [  ] As of December 15, 2008, there
were 4,550,000 shares of the registrant's common stock, par value $0.001, issued
and outstanding.  Of these, 2,050,000 shares are held by non-affiliates of
the registrant.  The market value of securities held by non-affiliates is
approximately $0.00 as our common stock does not presently trade.        DOCUMENTS INCORPORATED BY REFERENCE  If the following documents are incorporated by reference,
briefly describe them and identify the part of the Form 10-K (e.g., Part I,
Part II, etc.) into which the document is incorporated:  (1) any
annual report to security holders; (2) any proxy or information statement;
and (3) any prospectus filed pursuant to Rule 424(b) or (c) of the
Securities Act of 1933, as amended (Securities Act).Not Applicable.        2     TABLE
OF CONTENTS Item
Number and Caption Page Cautionary
Statements Regarding Forward-Looking Information 5 Description
Of Business 5 Item
1A. Risk Factors. 11 Item
1B. Unresolved
Staff Comments. 11 Item
2. Properties. 11 Item
3. Legal
Proceedings. 11 Item
4. Submission
Of Matters To A Vote Of Security Holders. 11 Part
II 11 Item
5. Market
For Registrants Common Equity, Related Stockholder Matters And Issuer Purchases
Of Equity Securities.11 Item
6. Selected
Financial Data. 12 Item
7. Managements
Discussion And Analysis Of Financial Condition And Results Of
Operations.12 Item
8  Financial Statements And Supplementary Data. 15 Item
9. Changes
In And Disagreements With Accountants On Accounting And Financial
Disclosure28 Item
9A.[T] Controls
And Procedures 28 Item
9B. Other
Information 29 Part
III 29 Item
10. Directors,
Executive Officers, And Corporate Governance 29 Item
11. Executive
Compensation 31 Item
12. Security
Ownership Of Certain Beneficial Owners And Management And Related Stockholder
Matters33 Item
13. Certain
Relationships And Related Transactions, And Director Independence 34 Item
14. Principal
Accountant Fees And Services 34 Part
IV 35 Item
15. Exhibits
And Financial Statement Schedules 35 Signatures 36           CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING
INFORMATION Except for historical information, this report contains
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934.  Such forward-looking statements involve risks and
uncertainties, including, among other things, statements regarding our business
strategy, future revenues and anticipated costs and expenses.  Such
forward-looking statements include, among others, those statements including the
words expect, anticipate, intend, believe and similar language.
 Our actual results may differ significantly from those projected in the
forward-looking statements.  Factors that might cause or contribute to such
differences include, but are not limited to, those discussed in the sections
Plan of Operation and Business.  You are cautioned not to place undue
reliance on the forward-looking statements, which speak only as of the date of
this report.  We undertake no obligation to publicly release any revisions
to the forward-looking statements or reflect events or circumstances taking
place after the date of this document. 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.  All references in
this Form 10-K to the Company, El Palenque, we, us or our are to El
Palenque Vivero, Inc.     Description
of Business General
Information  El Palenque Vivero,
Inc. (El Palenque or the Company) was incorporated in the State of Nevada on
June 21, 2006 as El Palenque Nercery, Inc.  On June 30, 2006 the Company
changed the name to El Palenque Vivero, Inc.  We were incorporated to open
and operate a plant nursery in the city of Cuernavaca, in the state of Morelos,
Mexico.  Francisco Mendez was named as President, Treasurer, CFO, CEO and
Director of the Company.  Yosbani Mendez was named Secretary and Director
of the Company.  At that time the board of directors voted to seek capital
and begin development of our business plan.  We received our initial
funding of $20,000 through the sale of common stock to Francisco Mendez who
purchased 1,000,000 shares of common stock at $0.005 on June 30, 2006, 500,000
shares of common stock at $0.01 on August 1, 2006, and Yosbani Mendez who
purchase 1,000,000 shares of common stock at $0.01 on August 1, 2006.  In
October 2006 we received $37,000 from 18 individuals who purchased 925,000
shares of our common stock at $0.04 per share.  During December, 2006 
June, 2007, we received $45,000 from 19 individuals from our public offering for
1,125,000 shares at $0.04 per share.  As of September 30,
2008 we had generated no revenues.  We have been issued an opinion by our
auditor that raises substantial doubt about our ability to continue as a going
concern based on our current financial position.  Please refer to note 5 of
our financial statements.  We have a total of
100,000,000 authorized common shares and 100,000,000 authorized preferred
shares, both with a par value of $0.001 per share, and have 4,550,000 common
shares issued and outstanding as of September 30, 2008.  We have
completed a form SB-2 Registration Statement under the Securities Act of 1933
with the U.S. Securities and Exchange Commission registering 2,750,000 shares of
our common stock in connection with an offering of the 2,750,000 shares at a
price of $0.04 per share.  Of the shares being registered, 925,000 were
registered for sale by the selling shareholders, and 1,825,000 were registered
for sale by the Company.  As of September 30, 2008, we had completed the
offering and raised a total of $45,000 on the issuance of 1,125,000 shares.
 We closed the offering on June 1, 2007, and the remaining 700,000 shares
went unsold by the Company.         Our
principal offices are located at Privada de Tabasco # 27, Colonia Maravillas,
Cuernavaca, Morelos, México 62320, and our telephone number is (305) 394-9730.
 Francisco Mendez, our President and director, supplies this office space
on a rent free basis. Business
Development  El Palenque has no
revenues and limited operations.  We have sustained losses since inception,
June 21, 2006, to September 30, 2008 of $18,199 and rely solely upon the sale of
securities and loans from our corporate officers and directors for funding.  El Palenque has never
declared bankruptcy, been in receivership, or involved in any kind of legal
proceeding.  The Company, its directors, officers, affiliates and promoters
have not and do not have any present intentions to enter into negotiations or
discussions with representatives or owners of any other businesses or companies
regarding the possibility of an acquisition or merger.  Business of
Issuer  Principal
Products  It is our intention
to incorporate a Mexican company in which we will own 100% of the shares, to be
used for the purpose of leasing land and purchasing the equipment and supplies
required for the nursery.  El Palenque intends
to open and operate a plant nursery in the city of Cuernavaca, in the state of
Morelos, Mexico. We intend to accomplish this goal by leasing land for our
nursery in Cuernavaca which we will then do leasehold improvements upon and
cultivate plants to offer to businesses and the public.  We feel we have
raised sufficient cash, in order to lease land, purchase the necessary
equipment, produce our products, and operate for the next 12 months.  We do
not expect to start cultivating our products until the last 2 months of the
coming year, thus, we do not expect to be generating significant revenues from
our nursery in the first year of operations.  Our primary focus is
to lease a suitable piece of land for our nursery, construct a green house,
construct irrigation and prepare the land that will enable us to make our
products available to the public, with a goal of generating a plant base for
supermarkets, contractors, hotels and the public to generate revenues.  El Palenques nursery will produce popular herbs, ornamental and
garden plants, and will work to produce flowers and plants that are seasonal,
like poinsettias for the Christmas season.We will concentrate on
certain product categories that are conducive to the growing climate in
south-central Mexico.  The temperatures in Cuernavaca average 20oC (68oF)
from September to February and 22oC - 24oC (71oF to 75oF) from March to August
with the rainy season being from May to October and the dry season from November
to April.  Our primary marketing
approach is to provide products to established stores in the surrounding area,
such as Cuernavaca, Acapulco, Taxco, Pueblo, and Mexico City, hotels,
landscapers, construction companies, and individuals.  The development of
large vacation centers and tourist spots has required the production of a wide
variety of plants and flowers, as well as plants for the art of landscape
gardening.  We will be able to
offer personalized services, quality plants and fast service.  We will be
able to guarantee a large portion of plants and herbs as organic.
 Additionally, with the climate of Cuernavaca we will be able to offer most
of our products year round.  Cuernavaca is known as la ciudad de la eterna
primavera (the city of eternal spring).   5       The types of plants
we plan to grow include:  Short-term Plants · These
are plants that will grow in a period of 1-4 months. · These
consist of the edible organic herbs, plants such as roses, orchids, passion
flowers, gardenia, tulips etc. · Seasonal
plants such as poinsettias.  Mid-term Plants · These
are plants that are grown in a period of 5-12 months. · Types
of plants are decorative malanga (a tuber similar to a sweet potato), decorative
yucca, iris, and bougainvillea.  Long-term Plants · These
are plants that are grown in a period of one year or more. · Ficus,
palms and oleanders. · Fruit
trees including orange, mandarin, avocado, grapefruit, guava, cacao and
lime.  We plan to establish
water and fertilizer recycling systems to minimize the costs of these elements
and maximize water conservation.  Selecting the
Nursery Site  Site selection and
layout are very important to the success of a nursery.  Our choice will
directly affect our success in growing and selling plants as a poor choice could
lead to greater cost, reduced plant quality, increased product losses and
reduced profit.  There are at least
six factors that we will consider when evaluating our potential nursery
site:  1. Quantity
and quality of irrigation water 2. Access
to transportation and markets 3. Topography
and soil type 4. Access
to, and type of, utilities 5. Favorable
climactic conditions 6. Access
to steady labor supply  The history of the
site is extremely important and specific questions we will address are:  1. If
crop land, what crop was grown? 2. If
non-crop land, what was the land used for previously? 3. Has
the land been contaminated by pesticide or other toxins? 4. If
so, what reclamation efforts were made? 5. Are
there underground structures on the property (utility lines, storage tanks,
irrigation lines or drainage tile)? 6. If
so, where are they located and what are their sizes? 7. Does
the land drain poorly or flood?  Another consideration
is the soil type and characteristics.  General characteristics for a good
nursery soil include a tillable, well-drained soil with high water-holding
capacity.  The land should have less than 5% slope to insure good air flow
and surface drainage.  While a majority of our production will be container
based, the type of soil is still important for our limited field production.   6       Of all the needs of
plant production, the availability of ample, high-quality water is most
important.   Potential water sources include lakes and ponds, streams,
wells, and municipal water supplies.  Each must be tested and it is very
important for us to determine the water source and limitations prior to leasing
the property.  We will also give
thought to long-term development of the property.  In general this would
include issues that provide the least movement of plants and people and basic
issues like location for loading trucks, turning radius of equipment, width of
equipment and weight restrictions on access roads.  Production
Systems  The three main types
of nursery production systems are field, container and pot-in-pot.
 Selection of a production system is not exclusive, and at this time we
estimate our production will consist of 85% container and 15% field production.  Field production has
three major advantages.  First, it is often less demanding that container
production in terms of water and fertilizer requirements.  In addition, the
labor required is less intensive during production than container production.
 There are several disadvantages associated with field production which
include,  but are not limited to the harvesting or digging of the
field-grown products is limited to specific windows during the year, typically
fall and spring and is very labor intensive.  Field production also offers
a challenge in space allocation due to random harvesting or random plant death.
 In contrast, as plants are harvested for shipment in container
production, the container block can be re-sorted, moved or tightened-up.  A recent innovation
in field nursery production is the use of in-ground fabric containers, sometimes
called root control bags or field grow bags.  In theory, they combine the
best qualities of container and field production.  The advantages of field
grow bags are numerous: they enhance rooting; fewer roots are lost at
transplanting (80% of the roots are left intact); harvesting is easier; they
save labor and time; and no special machinery is needed at harvest.  Container production
makes possible almost year-round harvesting and availability of plants.
 Containers are usually watered with drip or trickle irrigation systems
which use 60% to 70% less water than overhead systems which are typically used
in field production.  There are high-density capabilities and the ability
to use land unsuited to field production.  Containers provide handling
convenience and increased flexibility for plant spacing not offered by field
production.  Handling advantages also translate into handling efficiencies
when stacking or loading trucks.  The use of container production also
means we could customize the growing media.  The potential to modify
chemical and physical properties in a container is much greater than for field
soil.  Container production also allows for growing transplant sensitive
plants.  While container production has many advantages, the system is not
without challenges.  The disadvantages include:  small containers need
frequent water, nutrients are rapidly depleted, plants may require winter
protection, plants become easily root-bound, trees are knocked over by wind and
containers can be costly.  Container grown plants cannot be held as long as
field plants.  Unsold field plants can simply stay in the soil; however
container plants will likely require moving up to a larger container which adds
to the cost of the final product.  To produce annual
bedding plants, we will either buy or germinate seeds to produce small plants,
called "plugs," or purchase plugs from specialized plug producers. The plugs
will then be transplanted to bedding packs, gallon hanging baskets and
containers of various sizes. The growth cycle of color plants is typically less
than one year, with many color plants having a growing season as short as eight
to 16 weeks, allowing approximately three to four inventory turns per year. As
with ornamental plants, we will apply controlled watering and fertilizing in
order to ensure high quality.   7       Distribution
Methods  Our services will be
offered to the public via word of mouth, newspaper advertising, and direct sales
to supermarkets, stores, landscapers, construction companies, and individuals.  Status of Publicly
Announced New Products or Services  We currently have no
new publicly announced products or services.  Competitive
Business Conditions and Strategy; El Palenque Viveros Position in the
Industry  We intend to
establish El Palenque Vivero as a competitive company in an already existing
market.  There is currently a need for our services, as there is a high
demand for quality organic edible herbs, ornamental plants and outdoor plants
and trees.  Having our nursery in this location provides us with ideal
year-round climate for growing our products as well as the area having good
access to a steady water supply.  Additionally, Cuernavaca is situated in
the middle of Mexico, being close to the heart of the country, Mexico City.
 Cuernavaca is a small city with wealth and is a preferred location for
people to live away from the city, plus it is close to the highest consumption
areas of the country, being 72 km from Mexico City, 260 km from Acapulco and 110
km from Pueblo.  The Company believes
that because we will be able to provide quality organic products, have modern
amenities, and be located in a highly populated part of Mexico with excellent
year-round climate, that we will have a distinct advantage over other nurseries
located in other parts of the country.  To date, we have not
entered into any negotiations with any supermarkets, stores, landscapers, or
construction companies to sell our products.  Additionally, we have not
started to look for a suitable piece of land.  Sources and
Availability of Raw Materials and Names of Principal Suppliers  The land that the
Company will lease for the nursery will be sourced from listings in newspapers,
via word of mouth, from canvassing the neighborhood looking for a suitable
location or from a real estate agent.  Because of the recent (and current)
construction boom in Cuernavaca for both residential and commercial properties,
we will be looking for our land in agricultural zones that surround the
city.  Also, there are many
sources of soil, seedlings, seeds, fertilizers, and other planting supplies in
Mexico and the market place for these products are highly competitive.
  The success of our business plan relies heavily on acquiring the
land and making the necessary improvements for irrigation, and having quality
organic supplies of soil. This will be achieved by taking time to find the right
piece of land with access to all available amenities, such as electricity, water
and telephone and signing a long-term lease.  We will be able to have
access to good quality organic soils at very reasonable prices, as there are
many suppliers surrounding Cuernavaca.   Our president, Francisco
Mendez, will determine where he will lease the land, purchase the necessary
equipment, soil and supplies by comparing prices between the different
suppliers.  We will also need to
hire two (2) day-time employees, one (1) office manager, and one (1) night time
security guard at the time the Company leases its land and has secured the
necessary business permits.  The day-time employees will be responsible for
the land renovations as well as the day to day operations of the business, the
office manager will be responsible for sourcing materials, keeping track of
inventory levels and maintaining detailed accounting reports.  To date, we have not
entered into any formal or preliminary negotiations with any nursery suppliers
or equipment vendors, realtor, property leasing agent, or potential employees.
 We will begin to source land,  8       purchase the
necessary equipment and supplies, and find employees to carry out the
implementation phase of our business plan at the time we have sufficient funding
to proceed.  Dependence on one
or a few major customers  Our business plan is
dependent upon finding a suitable piece of land to lease, so as to produce the
best possible products.  We intend to market our services to both local
residents and businesses. Since landscaping, herbs for cooking and ornamental
plants are in high demand by many individuals and businesses in our area we do
not anticipate having difficulties finding clients.  We also, do not
anticipate being dependent on a few major customers for our products.  Patents,
Trademarks, Licenses, Agreements or Contracts  There is no aspect of
our business plan that requires a patent, trademark, or product license, and we
have not entered into any vendor agreements or contracts that give rise to any
obligations or concessions.  Governmental
Controls, Approval and Licensing Requirements Before
El Palenque is able to lease land to start the nursery business, we will
incorporate a wholly owned Mexican corporation.  This corporation will be
required to obtain a Licencia de Formento Hortila y Ornamental. This permit is
issued by the Ministry of Agriculture provided that, upon inspection, the land
has met a certain set of standards in relation to its ability to be used as a
plant nursery.  These standards are to determine that the land is zoned for
agriculture and is able to sustain the requirements of a nursery.  We will also be
required to have our Mexican corporation enroll all their employees in the
Mexican Social Security system.  We will be responsible for submitting
these payments to the government on behalf of the employees.  Research and
Development Activities and Costs  We have spent no time
on specialized research and development activities, and have no plans to
undertake any research or development in the future.  Compliance with
Environmental Laws  There are no special
environmental laws for owning and operating a nursery in Mexico.  However,
certain procedures mandated by the Ministry of the Environment in relation to
the disposal and use of fertilizers and/or chemicals must be adhered to or you
may lose your business licenses for failure to comply.  Number of
Employees  At this time we have
no employees.   The officers and directors are donating their time to
thedevelopment of the Company and intend to
do whatever work is necessary in order to bring us to the point of being able to
implement our business plan. During the
implementation phase of our business plan, El Palenque will hire two (2)
day-time employees, one (1) day-time office manager, and one (1) night-time
security guard.  At this time the officers and directors of the Company
will continue to donate their time to the development of the Company in order to
bring it to the point of generating revenues.     9       Bankruptcy or
Similar Proceedings  There has been no
bankruptcy, receivership or similar proceeding.  Reorganizations,
Purchases or Sales of Assets  There have been no
material reclassifications, mergers, consolidations, or purchase or sale of a
significant amount of assets not in the ordinary course of business.   ITEM 1A. RISK
FACTORS.  Not Applicable.   ITEM
1B. UNRESOLVED
STAFF COMMENTS.  Not Applicable.   ITEM
2. PROPERTIES.  The
Company uses the home office premises of Francisco Mendez, the President of the
Company, on a rent-free basis.  The premises are located at Privada de
Tabasco # 27, Colonia Maravillas, Cuernavaca, Morelos, México  62320.
 The Company intends to use these premises until we are able to lease the
property for the nursery at which time we will utilize an onsite office. The
mailing address for the Company is 8567 Coral Way, Suite 198, Miami, FL 33155.  We
currently have no investment policies as they pertain to real estate, real
estate interests or real estate mortgages.   ITEM
3. LEGAL
PROCEEDINGS.  Legal
Proceedings  In the ordinary
course of our business, we may from time to time become subject to routine
litigation or administrative proceedings which are incidental to our business.
 We are not a party to nor are we aware of any existing, pending or
threatened lawsuits or other legal actions involving us.   ITEM
4. SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS.  No matters were
submitted to a vote of security holders, through the solicitation of proxies or
otherwise, during the fourth quarter of the fiscal year covered by this
report.        PART
II   ITEM
5. MARKET
FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES
OF EQUITY SECURITIES.  Market
Information  Bid and ask
prices for our common stock have been quoted on the Over-The-Counter Bulletin
Board (the OTCBB) under the symbol ELQV.OB since August 30, 2007. However,
our stock has never traded.  10         As of December 15,
2008, we had 39 shareholders of record of our common stock.  Dividends  We have never
declared any cash dividends with respect to our common stock.  Future
payment of dividends is within the discretion of our board of directors and will
depend on our earnings, capital requirements, financial condition and other
relevant factors.  Although there are no material restrictions limiting, or
that are likely to limit, our ability to pay dividends on our common stock, we
presently intend to retain future earnings, if any, for use in our business and
have no present intention to pay cash dividends on our common stock.  Recent Sales of
Unregistered Securities  During the fiscal
year ended September 30, 2008, we did not issued any securities without
registration under the Securities Act of 1933:   ITEM
6. SELECTED
FINANCIAL DATA.  Not applicable.   ITEM
7. MANAGEMENTS
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.  Results of
Operations  We
have generated no revenues since inception (June 21, 2006) and have incurred
$37,790 in expenses through September 30, 2008. The
following table provides selected financial data about our company as of and for
the year ended September 30, 2008 and 2007.  Balance Sheet Data:


September 30, 2008


September 30, 2007Cash

$
67,302

$
84,009Total assets

$
67,302

$
84,009Total liabilities

$
3,092

$
1,600Stockholders' Equity

$
64,210

$
82,409  Net
cash provided by financing activities since inception through September 30,
2008, was $102,000, consisting of $82,000 raised from the sale of common stock,
$82,000 from independent investors and $20,000 from directors and/or officers of
the Company. Plan of
Operation  Our auditors have
issued a going concern opinion on our September 30, 2008 audited financial
statements, refer to note 5. This means that there is substantial doubt that we
can continue as an ongoing business for the next twelve months unless we obtain
additional capital to pay for our expenses. This is because we have not
generated any revenues and there is no assurance we will ever reach this point.
Accordingly, we must raise sufficient capital from other sources. Our only other
source for cash at this  11       time is investments
by others. We must raise cash to stay in business. We raised $82,000 from our
private and public offerings. Under these offerings we sold 2,050,000 shares at
$0.04 per share to 37 shareholders. These shares, together with 2,500,000 shares
sold to two directors upon inception for $20,000, brings the total proceeds
received from stock sales to $102,000, the total number of shares issued to
4,550,000 shares, and the total number of shareholders to 39.  El Palenque is a
development stage company that has no operations, no revenue, no financial
backing and limited assets.  Our plan is to open a plant nursery in
Cuernavaca, Mexico and market our products to local residents and businesses via
advertising and word of mouth.  We had planned to
start operations by leasing approximately two (2) hectares (approx. 5 acres) of
land for our plant nursery in the city of Cuernavaca in the state of Morelos,
Mexico.  However, the Company has postponed its plans to proceed with the
nursery due to unexpected complications in working in Mexico.  The Company
continues to work towards that goal.  The Company is also seeking
additional business opportunities, but has yet to identify any viable options.
 We have not undertaken any research and development as of the date of this
report, or identified any real property to lease for its nursery.  Once property has
been identified and leased, the Company will proceed with its business plan by
incorporating a Mexican subsidiary and hire employees to work the nursery 6-10
months following the incorporation of the subsidiary.  Employees would
begin the development of the nursery buildings and land improvements.  The
Company does not expect to be able to generate revenue from the nursery with the
next 12 months of development.  We estimate that we
will be able to satisfy our cash requirements for the next 12 months. Limited
Operating History; Need for Additional Capital There
is no historical financial information about us upon which to base an evaluation
of our performance.  We are a development stage corporation and have not
generated any revenues from business operations.  We cannot guarantee we
will be successful in our business operations.  Our business is subject to
risks inherent in the establishment of a new business enterprise, including
limited capital resources and possible cost overruns due to price and cost
increases in services and products. We
have no assurance that future financing will be available to us on acceptable
terms.  If financing is not available on satisfactory terms, we may be
unable to continue, develop or expand our operations.  Equity financing
could result in additional dilution to existing shareholders. Currently,
we have no financing plans. Liquidity
and Capital Resources As
of the date of this report, we have yet to generate any revenues from our
business operations. Since
inception our main source for cash has been the sale of our equity securities.
 Upon inception, we issued 2,500,000 shares of common stock to two
directors for $20,000.  In June 2006, we completed a private offering of
925,000 shares of common stock to 18 persons in consideration of $37,000.
 This offering was made pursuant to the exemption from registration
contained in Rule 504 of Regulation D under the Securities Act.  During
December 2006 to June 2007, we issued 1,125,000 shares of common stock to 19
persons in consideration of $45,000.  These shares were issued pursuant to
our Prospectus filed as part of our registration statement on Form SB2 and
declared effective on December 11, 2006.  We raised a total of $102,000
from the sale of our common stock.  12       As of the date of
this filing, we have yet to begin operations and therefore have not generated
any revenues.  As
of September 30, 2008, our cash and total assets were $67,302 and our total
liabilities were $3,092.   13        ITEM 8  FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA.            EL
PALENQUE VIVERO, INC. (A
Development Stage Company)  AUDITED FINANCIAL STATEMENTS  SEPTEMBER 30, 2008 and 2007         14     EL
PALENQUE VIVERO, INC. (An Development Stage Company)  INDEX
TO AUDITED FINANCIAL STATEMENTS  FOR
THE PERIOD OF JUNE 21, 2006 (INCEPTION) TO SEPTEMBER 30, 2008   Page(s)  Report
of Independent Registered Public Accounting Firm 16  Balance
Sheets as of September 30, 2008 and 2007 17  Statements
of Operations for the year ended September 30, 2008 and 2007and from June
21, 2006 (Inception) to September 30, 2008 18  Statement of Changes
in Stockholders Equity for the period of June
21, 2006 (Inception) to September 30, 2008 19  Statements
of Cash Flows for the year ended September 30, 2008 and 2007and from June
21, 2006 (Inception) to September 30, 2008 20  Notes
to Financial Statements 21-26    15      MOORE &
ASSOCIATES, CHARTERED ACCOUNTANTS
AND ADVISORS PCAOB
REGISTERED   REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM   To
the Board of Directors El
Palenque Vivero, Inc. (A
Development Stage Company)  We have
audited the accompanying balance sheets of El Palenque Vivero, Inc. (A
Development Stage Company) as of September 30, 2008 and September 30, 2007, and
the related statements of operations, stockholders equity and cash flows for
the years ended September 30, 2008, 2007 and since inception on June 21, 2006
through September 30, 2008. These financial statements are the responsibility of
the Companys management.  Our responsibility is to express an opinion on
these financial statements based on our audits.  We
conduct our audits in accordance with standards of the Public Company Accounting
Oversight Board (United States).  Those standards require that we plan and
perform the audits 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 that
our audits provide a reasonable basis for our opinion.  In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of El Palenque Vivero, Inc. (A
Development Stage Company) as of September 30, 2008 and September 30, 2007, and
the related statements of operations, stockholders equity and cash flows for
the years ended September 30, 2008, 2007 and since inception on June 21, 2006
through September 30, 2008, in conformity with accounting principles generally
accepted in the United States of America.  The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern.  As discussed in Note 5 to the financial
statements, the Company had a net loss from operations of $18,199, an
accumulated deficit of $37,790 and working capital of $64,210, which raises
substantial doubt about its ability to continue as a going concern.
 Managements plans concerning these matters are also described in Note 5.
 The financial statements do not include any adjustments that might result
from the outcome of this uncertainty.  /s/ Moore & Associates, Chartered  Moore
& Associates, Chartered Las
Vegas, Nevada November 17, 2008  6490 West Desert Inn Rd, Las Vegas, NV 89146 (702) 253-7499
Fax (702) 253-7501  16    El Palenque Vivero, Inc. (A Development Stage Company) Balance Sheets As of September 30,    ASSETS2008

2007CURRENT ASSETSCash and cash
equivalents
$
67,302
$
84,009Prepaid expenses

-

-TOTAL ASSETS
$
67,302
$
84,009LIABILITIES
AND STOCKHOLDERS' EQUITYCURRENT
LIABILITIESAccounts payable and accrued
liabilities
$
3,092
$
1,600TOTAL LIABILITIES

3,092

1,600STOCKHOLDERS
EQUITYCapital
Stock (Note 3)Authorized:100,000,000
preferred shares, $0.001 par value100,000,000
common shares, $0.001 par valueIssued and outstanding
shares:4,550,000 common
shares

4,550

4,550Additional
paid-in capital

97,450

97,450Deficit accumulated during the
development stage

(37,790)

(19,591)Total Stockholders
Equity

64,210

82,409TOTAL LIABILITIES AND
STOCKHOLDERS EQUITY
$
67,302
$
84,009    -The accompanying notes
are an integral part of these financial statements -  17   El Palenque Vivero, Inc. (A Development Stage Company) Statements of Operations    Cumulative
fromInception(June 21, 2006)
toYear Ended
September 30,

September
30,2008


2007

2008REVENUES







$
-

$
-

$
-OPERATING
EXPENSESProfessional fees








12,717


15,636


30,924General and
administrative








6,312


1,324


7,696Total Operating
Expenses








19,029


16,960


38,620Other Income
(Expense)








830


-


830Net (Loss) before Income
Taxes








(18,199)


(16,960)


(37,790)Provision
for Income Taxes(Note
4)








-


-


-Net (Loss)







$
(18,199)

$
(16,960)

$
(37,790)PER SHARE DATA:Basic and diluted loss percommon share







$
(0.00)

$
(0.00)Weighted average number
ofcommon shares
outstanding








4,550,000


3,856,696                  -The accompanying notes
are an integral part of these financial statements -  18


El Palenque Vivero, Inc. (A Development Stage Company) Statement of Changes in Stockholders Equity For the period of June 21, 2006 (Inception) to September 30,
2008    DeficitAccumulatedAdditional

During theCommon
Stock

Paid-in

DevelopmentShares

Amount

Capital

Stage


TotalInception - June 21,
2006


-

$
-

$
-

$
-

$
-Common shares issued to a founderat
$0.005 cash per share, June 30, 2006

1,000,000


1,000


4,000


-


5,000Common shares issued to foundersat
$0.01 cash per share, August 1, 2006

1,500,000


1,500


13,500


-


15,000Loss for the period


-


-


-


(2,631)


(2,631)Balance - September 30, 2006


2,500,000

$
2,500

$
17,500

$
(2,631)

$
17,369Common shares
issued for cashat
$0.04 per share, June 1, 2007


2,050,000


2,050


79,950


-


82,000Loss for the
year


-


-


-


(16,960)


(16,960)Balance - September 30, 2007


4,550,000


4,550


97,450


(19,591)


82,409Loss for the
year


-


-


-


(18,199)


(18,199)Balance  September 30, 2008


4,550,000

$
4,550

$
97,450

$
(37,790)

$
64,210     -The accompanying notes
are an integral part of these financial statements -


19


El Palenque Vivero, Inc. (A Development Stage Company) Statements of Cash Flows    Cumulative
fromInception(June 21, 2006)
toYear Ended
September 30,

September
30,2008


2007

2008OPERATING
ACTIVITIESNet loss
$
(18,199)

$
(16,960)

$
(37,790)Changes in Operating Assets and
Liabilities:Decrease in
prepaid expenses

-


5,429


-Increase
(decrease) in accounts payable and accrued liabilities

1,492


100


3,092Net Cash Used in Operating
Activities

(16,707)


(11,431)


(34,698)INVESTING
ACTIVITIESNet Cash Provided by (Used in)
Investing Activities

-


-


-FINANCING
ACTIVITIESCommon stock issued for
cash

-


82,000


102,000Net Cash Provided by Financing
Activities

-


82,000


102,000NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS

(16,707)


70,569


67,302CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD

84,009


13,440


-CASH AND CASH EQUIVALENTS AT
END OF PERIOD
$
67,302

$
84,009

$
67,302Supplemental Cash Flow
Disclosures:Cash paid for Interest
$
-

$
-

$
-Cash paid for Income
Taxes
$
-

$
-

$
- -The accompanying notes
are an integral part of these financial statements -


20


El Palenque Vivero, Inc. (A Development Stage Company) Notes to Financial Statements September 30, 2008 and 2007    NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS  El Palenque Vivero, Inc. (the Company) was incorporated in the
State of Nevada on June 21, 2006.  The Company was originally incorporated
as El Palenque Nercery, Inc. and changed its name to El Palenque Vivero, Inc. on
June 30, 2006.  It is based in Cuernavaca, Morelos Mexico.  The
accounting and reporting policies of the Company conform to accounting
principles generally accepted in the United States of America, and the Companys
fiscal year end is September 30. The Company is a development stage company that intends to open
and operate a plant nursery in the state of Morelos, Mexico.  To date, the
Companys activities have been limited to its formation and the raising of
equity capital.  NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  Use of Estimates  The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
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 amount of
revenues and expenses during the reporting period.  Actual results could
differ from those estimates. The Companys periodic filings with the Securities
and Exchange Commission include, where applicable, disclosures of estimates,
assumptions, uncertainties and markets that could affect the financial
statements and future operations of the Company. Cash and Cash Equivalents  Cash and cash equivalents include cash in banks, money market
funds, and certificates of term deposits with maturities of less than three
months from inception, which are readily convertible to known amounts of cash
and which, in the opinion of management, are subject to an insignificant risk of
loss in value.  The Company had $67,302 and $84,009 in cash and cash
equivalents at September 30, 2008 and 2007, respectively.  The
Company maintains its cash in institutions insured by the Federal Deposit
Insurance Corporation (FDIC).  This government corporation insured balances
up to $100,000 through October 13, 2008.  As of October 14, 2008 all
non-interest bearing transaction deposit accounts at an FDIC-insured
institution, including all personal and business checking deposit accounts that
do not earn interest, are fully insured for the entire amount in the deposit
account.  This unlimited insurance coverage is temporary and will remain in
effect for participating institutions until December 31, 2009.  All
other deposit accounts at FDIC-insured institutions are insured up to at least
$250,000 per depositor until December 31, 2009.  On January 1, 2010, FDIC
deposit insurance for all deposit accounts, except for certain retirement
accounts, will return to at least $100,000 per depositor.         21    El Palenque Vivero, Inc. (A Development Stage Company) Notes to Financial Statements September 30, 2008 and 2007    NOTE
2 - SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (continued)  Start-Up Costs  In accordance with the American Institute of Certified Public
Accountants Statement of Position 98-5, Reporting on the Costs of Start-up
Activities, the Company expenses all costs incurred in connection with the
start-up and organization of the Company.  Earnings (Loss) per Share of Common Stock  The Company has adopted Financial Accounting Standards Board
(FASB) Statement Number 128, Earnings per Share, (EPS) which
requires presentation of basic and diluted EPS on the face of the income
statement for all entities with complex capital structures and requires a
reconciliation of the numerator and denominator of the basic EPS computation to
the numerator and denominator of the diluted EPS computation.  In the
accompanying financial statements, basic earnings (loss) per share is computed
by dividing net income (loss) by the weighted average number of shares of common
stock outstanding during the period.  Segmented Reporting  SFAS Number 131, Disclosure About Segments of an Enterprise
and Related Information, changed the way public companies report
information about segments of their business in their quarterly reports issued
to shareholders.  It also requires entity-wide disclosures about the
products and services an entity provides, the material countries in which it
holds assets and reports revenues and its major customers.  The company
presently operates only in Mexico.  Foreign Currency Transactions  The Companys functional currency is the Mexican Peso.  The
Companys reporting currency is the U.S. Dollar.  All transactions
initiated in Mexican Pesos are translated to U.S. Dollars in accordance with
SFAS No. 52 Foreign Currency Translation as follows:  (i) Monetary assets and liabilities at the rate of exchange in effect
at the balance sheet date; (ii) Equity at historical rates; and (iii) Revenue and expense items at the average rate of exchange
prevailing during the period.  Adjustments arising from such translations are deferred until
realization and are included as a separate component of stockholders equity as
a component of comprehensive income or loss.  Therefore, translation
adjustments are not included in determining net income (loss) but reported as
other comprehensive income.  For foreign currency transactions, the Company translates these
amounts to the Companys functional currency at the exchange rate effective on
the invoice date.  If the exchange rate changes between the time of
purchase and the time actual payment is made, a foreign exchange transaction
gain or loss results which is included in determining net income for the
period.  No significant realized exchange gains or losses were recorded
from inception (June 21, 2006) to September 30, 2008.    22    El Palenque Vivero, Inc. (A Development Stage Company) Notes to Financial Statements September 30, 2008 and 2007    NOTE
2 - SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (continued)  Stock-Based Compensation  The Company adopted the provisions of Statement of Financial
Accounting Standards (SFAS) No. 123(R), Share-Based Payment, which
establishes accounting for equity instruments exchanged for employee services.
 Under the provisions of SFAS 123(R), stock-based compensation cost is
measured at the grant date, based on the calculated fair value of the award, and
is recognized as an expense over the employees requisite service period
(generally the vesting period of the equity grant).  The Company accounts
for share-based payments to non-employees, in accordance with SFAS 123 (as
originally issued) and Emerging Issues Task force Issue No 96-18, Accounting
for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or
in Conjunction with Selling, Goods or Services.  Comprehensive Income (Loss)  SFAS No. 130, Reporting Comprehensive Income, establishes
standards for reporting and display of comprehensive income and its components
in a full set of general-purpose financial statements.  From inception
(June 21, 2006) to September 30, 2008, the Company had no items of other
comprehensive income.  Therefore, net loss equals comprehensive loss from
inception (June 21, 2006) to September 30, 2008.  Revenue Recognition  The Company recognizes revenue from the sale of products and
services in accordance with the Securities and Exchange Commission Staff
Accounting Bulletin No. 104 (SAB 104), Revenue Recognition in Financial
Statements.  Revenue will consist of plant sales and will be
recognized only when all of the following criteria have been met:  (i) Persuasive evidence for an agreement exists; (ii) Delivery has occurred; (iii) The fee is fixed or determinable; and (iv) Revenue is reasonably assured.  Recent Accounting Pronouncements  None of the following new pronouncements has current application
to the Company, but will be implemented in the Companys future financial
reporting when applicable.  In June 2008, the FASB issued FASB Staff Position EITF
03-6-1, Determining Whether Instruments Granted in Share-Based Payment
Transactions Are Participating Securities, (FSP EITF 03-6-1). FSP EITF
03-6-1 addresses whether instruments granted in share-based payment transactions
are participating securities prior to vesting, and therefore need to be included
in the computation of earnings per share under the two-class method as described
in FASB Statement of Financial Accounting Standards No. 128, Earnings per
Share. FSP EITF 03-6-1 is effective for financial statements issued for fiscal
years beginning on or after December 15, 2008 and earlier adoption is
prohibited. We are not required to adopt FSP EITF 03-6-1; neither do we believe
that FSP EITF 03-6-1 would have material effect on our financial positionand results of operations if adopted.    23    El Palenque Vivero, Inc. (A Development Stage Company) Notes to Financial Statements September 30, 2008 and 2007    NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)  Recent Accounting Pronouncements (continued)  In May 2008, FASB issued Financial Accounting Standards No. 163,
Accounting for Financial Guarantee Insurance Contracts - an interpretation
of FASB Statement No. 60. Diversity exists in practice in accounting for
financial guarantee insurance contracts by insurance enterprises under FASB
Statement No. 60, Accounting and Reporting by Insurance Enterprises. That
diversity results in inconsistencies in the recognition and measurement of claim
liabilities because of differing views about when a loss has been incurred under
FASB Statement No. 5, Accounting for Contingencies. This Statement requires that
an insurance enterprise recognize a claim liability prior to an event of default
(insured event) when there is evidence that credit deterioration has occurred in
an insured financial obligation. This Statement also clarifies how Statement 60
applies to financial guarantee insurance contracts, including the recognition
and measurement to be used to account for premium revenue and claim liabilities.
Those clarifications will increase comparability in financial reporting of
financial guarantee insurance contracts by insurance enterprises. This Statement
requires expanded disclosures about financial guarantee insurance contracts. The
accounting and disclosure requirements of the Statement will improve the quality
of information provided to users of financial statements. This Statement is
effective for financial statements issued for fiscal years beginning after
December 15, 2008, and all interim periods within those fiscal years.  In May 2008, FASB issued Financial Accounting Standards No. 162,
The Hierarchy of Generally Accepted Accounting Principles. This
Statement identifies the sources of accounting principles and the framework for
selecting the principles to be used in the preparation of financial statements
of nongovernmental entities that are presented in conformity with generally
accepted accounting principles (GAAP) in the United States (the GAAP hierarchy).
This Statement is effective 60 days following the SEC's approval of the Public
Company Accounting Oversight Board amendments to AU Section 411, The Meaning of
Present Fairly in Conformity With Generally Accepted Accounting Principles.  In
March 2008, FASB issued Financial Accounting Standards No. 161, Disclosure
about Derivative Instruments and Hedging Activities  an amendment to FASB
Statement No. 133. The use and complexity of derivative instruments and
hedging activities have increased significantly over the past several years.
Constituents have expressed concerns that the existing disclosure requirements
in FASB Statement No. 133, Accounting for Derivative Instruments and Hedging
Activities, do not provide adequate information about how derivative and
hedging activities affect an entitys financial position, financial performance,
and cash flows. Accordingly, this Statement requires enhanced disclosures about
an entitys derivative and hedging activities and thereby improves the
transparency of financial reporting. This Statement is effective for financial
statements issued for fiscal years and interim periods beginning after November
15, 2008.  In
December 2007, FASB issued Financial Accounting Standards No. 160,
Noncontrolling Interests in Consolidated Financial Statements  an amendment
of ARB No. 51. This statement amends ARB No. 51 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 of the portion of equity in a subsidiary not
attributable, directly or indirectly, to a parent.  SFAS 160 is effective
for fiscal years, and interim periods with those fiscal years, beginning on or
after December 15, 2008 (that is, January 1, 2009, for entities with calendar
year-ends).   24    El Palenque Vivero, Inc. (A Development Stage Company) Notes to Financial Statements September 30, 2008 and 2007    NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)  Recent Accounting Pronouncements (continued)  In
December 2007, FASB issued a revision to Financial Accounting Standards No. 141
(revised 2007), Business Combinations. The objective of this
Statement is to improve the relevance, representational faithfulness, and
comparability of the information that a reporting entity provides in its
financial reports about a business combination and its effects. 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.  In February 2007, FASB issued Financial Accounting Standards 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 Boards long-term measurement objectives for accounting for financial
instruments.  SFAS 159 is effective as of the beginning of an entitys
first fiscal year that begins after November 15, 2007.  In September 2006, FASB issued Financial Accounting Standards No.
157, Fair Value Measurements.   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 the 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 practice.  SFAS 157 is effective in the first fiscal year
that begins after November 15, 2007.  NOTE 3 -   CAPITAL STOCK  Authorized
Stock  The Company has authorized 100,000,000 common shares and
100,000,000 preferred shares, both with a par value of $0.001 per share.
 Each common share entitles the holder to one vote, in person or proxy, on
any matter on which action of the stockholders of the corporation is sought.  Share Issuance  From inception of the Company (June 21, 2006) to September 30,
2008, the Company has issued 1,000,000 common shares at $0.005 per share,
1,500,000 common shares at $0.01 per share, and 2,050,000 common shares at $0.04
per share, resulting in total proceeds of $102,000 and 4,550,000 common shares
issued and outstanding at September 30, 2008 and 2007. Of these shares,
2,500,000 were issued to directors and officers of the Company and 2,050,000
were issued to independent investors.  There are no preferred shares outstanding.  The Company has
issued no authorized preferred shares.The Company has no
stock option plan, warrants or other dilutive securities.  25    El Palenque Vivero, Inc. (A Development Stage Company) Notes to Financial Statements September 30, 2008 and 2007    NOTE 4 - INCOME TAXES  The Company recognizes the tax effects of transactions in the year
in which such transactions enter into the determination of net income,
regardless of when reported for tax purposes. Deferred taxes are provided in the
financial statements under SFAS No. 109 to give effect to the resulting
temporary differences which may arise from differences in the bases of fixed
assets, depreciation methods, allowances, and start-up costs based on the income
taxes expected to be payable in future years. Minimal development stage deferred
tax assets arising as a result of net operating loss carryforwards have been
offset completely by a valuation allowance due to the uncertainty of their
utilization in future periods. Operating loss carryforwards generated during the
period from June 21, 2006 (date of inception) through September 30, 2008 of
$37,790 will begin to expire in 2026. Accordingly, deferred tax assets of
approximately $13,000 were offset by the valuation allowance, which increased by
approximately $6,500 and $5,600 during the year ended September 30, 2008 and
2007, respectively.  NOTE 5 - GOING CONCERN AND LIQUIDITY CONSIDERATIONS  The accompanying financial statements have been prepared assuming
that the Company will continue as a going concern, which contemplates the
realization of assets and the liquidation of liabilities in the normal course of
business.  As at September 30, 2008, the Company had a loss from operations
of $18,199, an accumulated deficit of $37,790, and working capital of $64,210
and has earned no revenues since inception.  The Company intends to fund
operations through equity financing arrangements, which may be insufficient to
fund its capital expenditures, working capital and other cash requirements for
the year ending September 30, 2009.  The ability of the Company to emerge from the development stage is
dependent upon, among other things, obtaining additional financing to continue
operations, and development of its business plan.  In response to these problems, management intends to raise
additional funds through public or private placement offerings.  These factors, among others, raise substantial doubt about the
Companys ability to continue as a going concern.  The accompanying
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.           26      ITEM
9. CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE  Not applicable.   ITEM
9A.[T] CONTROLS
AND PROCEDURES  Evaluation of Our
Disclosure Controls and Internal Controls  Under the supervision
and with the participation of our senior management, including our chief
executive officer and chief financial officer, Francisco Mendez, we conducted an
evaluation of the effectiveness of the design and operation 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 (the Exchange Act), as of the end
of the period covered by this annual report (the Evaluation Date).  Based
on this evaluation, our chief executive officer and chief financial officer
concluded as of the Evaluation Date that our disclosure controls and procedures
were effective such that the information relating to us, including our
consolidated subsidiaries, required to be disclosed in our Securities and
Exchange Commission (SEC) reports (i) is recorded, processed, summarized and
reported within the time periods specified in SEC rules and forms, and (ii) is
accumulated and communicated to our management, including our chief executive
officer and chief financial officer, as appropriate to allow timely decisions
regarding required disclosure.  Managements
Annual Report on Internal Control Over Financial Reporting  The
management of the Company is responsible for establishing and maintaining
adequate internal control over financial reporting.  The internal control
process has been designed, under our supervision, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of the Companys financial statements for external reporting purposes in
accordance with the accounting principles generally accepted in the United
States of America.  Management conducted an assessment of the effectiveness of the
Companys internal control over financial reporting as of September 30, 2008,
including (i) the control environment, (ii) risk assessment, (iii) control
activities, (iv) information and communication, and (v) monitoring.  Based
on this assessment, management has determined that the Companys internal
control over financial reporting as of September 30, 2008 was effective.  Our
internal control over financial reporting is a process designed to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes of accounting
principles generally accepted in the United States.  Because of its
inherent limitations, internal control over financial reporting may not prevent
or detect misstatements.  Therefore, even those systems determined to be
effective can provide only reasonable assurance of achieving their control
objectives.  In evaluating the effectiveness of our internal control over
financial reporting, our management used the criteria set forth by the Committee
of Sponsoring Organizations of the Treadway Commission (COSO) in Internal
Control  Integrated Framework.  This
annual report does not include an attestation report of our registered public
accounting firm regarding internal control over financial reporting.
 Managements report was not subject to attestation by our registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit us to provide only managements report in this
annual report.     27      Officers Certifications  Appearing as exhibits
to this Annual Report are Certifications of our Chief Executive Officer and
Chief Financial Officer.  The Certifications are required pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002 (the Section 302
Certifications).  This section of the Annual Report contains information
concerning the Controls Evaluation referred to in the Section 302 Certification.
 This information should be read in conjunction with the Section 302
Certifications for a more complete understanding of the topics presented.  Changes in Internal Control Over Financial Reporting  There have been no
changes in our internal control over financial reporting that occurred during
the quarter ended September 30, 2008 that have materially affected or are
reasonably likely to materially affect our internal control over financial
reporting.   ITEM
9B. OTHER
INFORMATION  Not
applicable.     PART
III   ITEM
10. DIRECTORS,
EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE  Executive
Officers, Directors and Key Employees  Directors serve until
the next annual meeting of the stockholders; until their successors are elected
or appointed and qualified, or until their prior resignation or removal.
 Officers serve for such terms as determined by our board of directors.
 Each officer holds office until such officers successor is elected or
appointed and qualified or until such officers earlier resignation or removal.  The following table
sets forth certain information, as of December 15, 2008, with respect to our
directors and executive officers.  Name
Positions Held
AgeFrancisco
Mendez
Privada de
Tabasco #27
Colonia
Maravillas
Cuernavaca,
Morelos México 62320
Chief Executive
and Financial Officer, President, Treasurer and Director
52Yosbani
Mendez
8567 Coral Way,
Ste 198
Miami, FL
 33155
Secretary and
member of the Board of Directors
37  Francisco Mendez has
held the positions of President, CEO, CFO, Treasurer and a director and Yosbani
Mendez the positions of Secretary and director since inception.  They are
expected to hold said offices/positions until the next annual meeting of our
stockholders.  Messrs. Mendez our
cousins and are our only officers, directors, promoters, and control
persons.  Certain
biographical information of our directors and officers is set forth
below.   28      Francisco
Mendez Mr.
Mendez has a Masters of Sports Training, which he obtained in 1986 from the
Instituto Superior de Cultura Fisica Manuel Fajardo, in Havana, Cuba. Mr.
Mendez was a weight lifter in the heavy weight class, where he joined the Cuban
national team in 1973 and competed until 1981. He had a distinguished amateur
career representing Cuba in many competitions culminating in being the Junior
World Champion in 1978, placing eighth in the heavy weight class in the 1976
Olympics in Montreal as a junior age competitor, and finishing fourth in the
1980 Moscow Olympics. Since
2000, Mr. Mendez has been self-employed businessman, specializing in the
residential housing construction market, where he undertakes construction,
remodeling, design, and professional landscaping services.  In 2005, he
incorporated a Mexican company called Constructora Colibrica S.A. and is the
President and sole owner of the company.  This company has two main areas
of business, the management and administration of estates and construction.
 Through this company, he manages 8 employees for the management and
administration; these employees provide maintenance, landscaping and ongoing
gardening services for the estates of wealthy individuals. Mr. Mendez, through
this company, also does residential speculation construction and remodeling
projects.  He has been focused buying residential lots and constructing
houses for resale to the middle to upper-middle class in Cuernavaca, Morelos
Mexico. Mr.
Mendez will devote 30% of his time to us, or approximately 12 hours per week to
our operations. Currently, the remaining 70% of Mr. Mendez's time is devoted to
his running Constructora Colibrica S.A. Yosbani
Mendez Mr.
Mendez graduated with a Bachelor of Science Degree in Physical Education in
1995, from the Instituto Superior de Educacion Fisica Manuel Fajardo, in Pinar
del Rio, Cuba. Mr. Mendez had his Bachelor of Science Degree validated from the
University of Central Florida in 1998. Since
2000 - present, Mr. Mendez has been working for the city of Miami Beach Fire
Department, in their Ocean Rescue Division. His responsibility is as a Lifeguard
on Miami Beach. Mr. Mendez is the President and sole owner of Hercules One Pool
Service Inc., incorporated in Florida. This company provides pool services to
clients in the Miami-Dade County. Mr.
Mendez will devote up to 20% of his time to us, or approximately 8 hours per
week to our operation. Currently, the remaining 80% of Mr. Mendez's time is
devoted to his work with the Miami Beach Fire Department and with running
Hercules One Pool Services, Inc. Employment
Agreements  Our officers are our
only employees and we do not have any employment agreements with them.  Term of
Office  Our directors are
appointed for a period of one year or until such time as their replacements have
been elected by our shareholders.  The officers of the Company are
appointed by our board of directors and hold office until their resignation or
removal.   29      Audit
Committee  We do not have a
standing audit committee, an audit committee financial expert, or any committee
or person performing a similar function.  We currently have limited working
capital and no revenues.  Management does not believe that it would be in
our best interests at this time to retain independent directors to sit on an
audit committee.  If we are able to raise sufficient financing in the
future, then we will likely seek out and retain independent directors and form
an audit, compensation committee and other applicable committees.  Board of Directors  Our two directors are
our corporate officers.  We do not have an independent director.  We
do not pay them for attending board meetings.  They are reimbursed,
however, for his expenses, if any, for attendance at meetings of the Board of
Directors.  Our Board of Directors may designate from among its members an
executive committee and one or more other committees but has not done so to
date.  We do not have a nominating committee or a nominating committee
charter.  Further, we do not have a policy with regard to the consideration
of any director candidates recommended by security holders.  To date this
has not been a problem as no security holders have made any such
recommendations.  Our two directors perform all functions that would
otherwise be performed by committees.  Given the present size of our board
it is not practical for us to have committees.  If we are able to grow our
business and increase our operations we intend to expand the size of our board
and allocate responsibilities accordingly.    Compliance with
Section 16(a) of the Exchange Act  Our common stock is
not registered pursuant to Section 12 of the Securities Exchange Act of 1934, as
amended (the Exchange Act).  Accordingly, our officers, directors and
principal shareholders are not subject to the beneficial ownership reporting
requirements of Section 16(a) of the Exchange Act.  Code of Ethics  In 2007 we adopted a
Code of Ethics that applies to all of our employees.  A copy of our Code of
Ethics was filed as an exhibit to the 10KSB filed December 12, 2007, and will be
provided to any person requesting same without charge.  To request a copy
of our Code of Ethics, please make written request to our President c/o
Touchstone Mining Limited at 11923 SW 37 Terrace, Miami, FL 33175.   ITEM
11. EXECUTIVE
COMPENSATION  The following table
sets forth information concerning the total compensation paid or accrued by us
during the two fiscal years ended September 30, 2008 and 2007 to (i) all
individuals that served as our principal executive officer or acted in a similar
capacity for us at any time during the fiscal year ended September 30, 2008;
(ii) all individuals that served as our principal financial officer or acted in
a similar capacity for us at any time during the fiscal year ended September 30,
2008; and (iii) all individuals that served as executive officers of ours at any
time during the fiscal year ended September 30, 2008 that received annual
compensation during the fiscal year ended September 30, 2008 in excess of
$100,000.         30      Summary Compensation Table  Name and Principal Position

Year

Salary
($)

Bonus ($)

Stock Awards ($)

Option Awards ($)

Non-
Equity Incentive
Plan Compen-sation ($)

Change in Pension Value
and
Non-
qualified
Deferred
Compen-sation
Earnings ($)

All
Other
Compen-sation ($)

Total ($)(a)

(b)

(c)

(d)

(e)

(f)

(g)

(h)

(i)

(j)Francisco
Mendez,Chief Executive and Financial Officer

2008
2007

5,000
0

0
0

0
0

0
0

0
0

0
0

0
0

5,000
0Yosbani
Mendez
Secretary

2008
2007

0
0

0
0

0
0

0
0

0
0

0
0

0
0

0
0   We have not issued
any stock options or maintained any stock option or other incentive plans since
our inception. We have no plans in place and have never maintained any plans
that provide for the payment of retirement benefits or benefits that will be
paid primarily following retirement including, but not limited to, tax qualified
deferred benefit plans, supplemental executive retirement plans, tax-qualified
deferred contribution plans and nonqualified deferred contribution plans.
Similarly, we have no contracts, agreements, plans or arrangements, whether
written or unwritten, that provide for payments to the named executive officers
or any other persons following, or in connection with the resignation,
retirement or other termination of a named executive officer, or a change in
control of us or a change in a named executive officers responsibilities
following a change in control.  Compensation of
Directors  None of our directors
receive any compensation for serving as such, for serving on committees of the
board of directors or for special assignments. During the fiscal year ended
September 30, 2008 there were no other arrangements between us and our directors
that resulted in our making payments to any of our directors for any services
provided to us by them as directors.  Indemnification  Under our bylaws, we
may indemnify an officer or director who is made a party to any proceeding,
including a lawsuit, because of his position, if he acted in good faith and in a
manner he reasonably believed to be in our best interest.  We may advance
expenses incurred in defending a proceeding.  To the extent that the
officer or director is successful on the merits in a proceeding as to which he
is to be indemnified, we must indemnify him against all expenses incurred,
including attorneys fees.  With respect to a derivative action, indemnity
may be made only for expenses actually and reasonably incurred in defending the
proceeding, and if the officer or director is judged liable, only by a court
order.  The indemnification is intended to be to the fullest extent
permitted by the laws of the State of Nevada.  Regarding
indemnification for liabilities arising under the Securities Act, which may be
permitted to directors or officers under Nevada law, we are informed that, in
the opinion of the Securities and Exchange Commission, indemnification is
against public policy, as expressed in the Act and is, therefore,
unenforceable.    31      ITEM
12. SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED STOCKHOLDER MATTERS  The following table
sets forth information with respect to the beneficial ownership of our common
stock known by us as of December 15, 2008 by:  · each
person or entity known by us to be the beneficial owner of more than 5% of our
common stock;  · each
of our directors;  · each
of our executive officers; and  · all
of our directors and executive officers as a group.  The percentages in
the table have been calculated on the basis of treating as outstanding for a
particular person, all shares of our common stock outstanding on such date and
all shares of our common stock issuable to such holder in the event of exercise
of outstanding options, warrants, rights or conversion privileges owned by such
person at said date which are exercisable within 60 days of December 15, 2008.
 Except as otherwise indicated, the persons listed below have sole voting
and investment power with respect to all shares of our common stock owned by
them, except to the extent such power may be shared with a spouse.  Name and Address of Beneficial Owner

Title of Class

Amount and Nature of Beneficial
Ownership(1)

Percentage of Class(2)Francisco
Mendez (3)
Privada de
Tabasco #27,
Colonia
Maravillas,
Cuernavaca,
Morelos,
Mexico
 62320

Common Stock,
par value $0.001 per share

1,500,000
Shares (Direct)

33.0%Yosbani Mendez
(3)
8567 Coral Way,
# 198
Miami, FL
 33155

Common Stock,
par value $0.001 per share

1,000,000
Shares (Direct)

22.0%All officers
and directors as a group (2 people)

Common Stock,
par value $0.001 per share

2,500,000
Shares (Direct)

55.0% (1) As
used herein, the term beneficial ownership with respect to a security is defined
by Rule 13d-3 under the Securities Exchange Act of 1934 as consisting of sole or
shared voting power (including the power to vote or direct the vote) and/or sole
or shared investment power (including the power to dispose or direct the
disposition of) with respect to the security through any contract, arrangement,
understanding, relationship or otherwise, including a right to acquire such
power(s) during the next 60 days.  Unless otherwise noted, beneficial
ownership consists of sole ownership, voting and investment rights.  (2) There
were 4,550,000 shares of common stock issued and outstanding on December 15,
2008.  32       (3) Francisco
and Yosbani Mendez are cousins.  Securities
Authorized for Issuance Under Equity Compensation Plans  We have not adopted
any equity compensation plans since our inception.   ITEM
13. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
INDEPENDENCE  In June and August,
2006, we issued a total of 2,500,000 shares of restricted common stock to
Francisco and Yosbani Mendez, our then directors and officers.  This was
accounted for as an issuance of shares of common stock in the amount of $20,000.
 These shares of common stock are restricted securities, as defined in Rule
144 of the Rules and Regulations of the SEC promulgated under the Securities
Act.      ITEM
14. PRINCIPAL
ACCOUNTANT FEES AND SERVICES  Audit
Fees.  The aggregate fees
billed to us by our principal accountant for services rendered during the fiscal
years ended September 30, 2008 and 2007 are set forth in the table below:  Fee Category
Fiscal year ended
September 30, 2008
Fiscal year ended
September 30, 2007Audit fees (1)
$ 6,250
$ 3,950Audit-related fees (2)
0
0Tax fees (3)
500
0All other fees (4)
0
0Total fees
$ 6,750
$ 3,950  (1) Audit fees
consist of fees incurred for professional services rendered for the audit of
consolidated financial statements, for reviews of our interim consolidated
financial statements included in our quarterly reports on Form 10-QSB and for
services that are normally provided in connection with statutory or regulatory
filings or engagements.  (2) Audit-related
fees consist of fees billed for professional services that are reasonably
related to the performance of the audit or review of our consolidated financial
statements, but are not reported under Audit fees.  (3) Tax fees consist
of fees billed for professional services relating to tax compliance, tax
planning, and tax advice.  (4) All other fees
consist of fees billed for all other services.     33      Audit Committees
Pre-Approval Practice.  We do
not have an audit committee.  Our board of directors performs the function
of an audit committee.  Section 10A(i) of the Securities Exchange Act of
1934, as amended, prohibits our auditors from performing audit services for us
as well as any services not considered to be audit services unless such services
are pre-approved by our audit committee or, in cases where no such committee
exists, by our board of directors (in lieu of an audit committee) or unless the
services meet certain de minimis standards.    PART
IV   ITEM
15. EXHIBITS
AND FINANCIAL STATEMENT SCHEDULES  Exhibits  The following
exhibits are included as part of this report:  Exhibit
No.

SEC Report
Reference
No.

Description3.1

3.1

Articles of
Incorporation of Registrant (1)3.2

3.2

By-Laws of
Registrant (1)14.1

14.1

Code of Ethics
(2)31.1 /
31.2

*

Rule
13(a)-14(a)/15(d)-14(a) Certification of Principal Executive and Financial
Officer32.1 /
32.2

*

Rule 1350
Certification of Chief Executive and Financial
Officer  (1) Filed
with the Securities and Exchange Commission on November 22, 2006 as an exhibit,
numbered as indicated above, to the Registrants registration statement on the
Registrants Registration Statement on Form SB-2 (file no. 333-138927), which
exhibit is incorporated herein by reference.  (2) Filed
with the Securities and Exchange Commission on December 13, 2007 as an exhibit,
numbered as indicated above, to the Registrants Annual Report on Form 10-KSB
for the year ended September 30, 2007, which exhibit is incorporated herein by
reference.  * Filed
herewith.   34      SIGNATURES   Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.  Date:
 December 23, 2008 EL
PALENQUE VIVERO, INC.   By:/S/
Francisco Mendez Name: Francisco
Mendez Title: President   Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates indicated. Signature
Title
Date/s/
Francisco Mendez
Francisco
Mendez
President
(principal executive officer), Chief Financial Officer (principal
financial officer) and member of the Board of Directors
December
23, 2008/s/
Yosbani Mendez
Yosbani
Mendez
Secretary
and member of the Board of Directors
December
23, 2008  35