U.S. SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





FORM 10-K/A


Amendment No. 1





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





For the fiscal year ended December 31, 2008








Commission File No.333-140305





EXCLUSIVE APPAREL, INC.


(Exact name of small business issuer as specified in its charter)





Nevada
20-5567127(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)





8860 Greenlawn Street, Riverside, California 92508


(Address of Principal Executive Offices)





(951) 902-2022


(Issuer’s telephone number)








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





Securities registered pursuant to Section 12(b) of the Act: None





Securities registered pursuant to Section 12(g) of the Act: Common Stock, $0.001 par value





Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter periods 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  [   ]





Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B not contained in this form, and no disclosure will be contained, to the best of the 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.  [   ]





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


Yes  [X]     No  [   ]





Revenues for year ended December 31, 2008:   $-0-





Aggregate market value of the voting common stock held by non-affiliates of the registrant as of November 18, 2009 was:  $-0-





Number of shares of our common stock outstanding as of November 20, 2009 is: 37,000,000





The Company has retained the services of Pacific Stock Transfer Company to facilitate the processing of the stock certificates.  Pacific Stock Transfer Company is a registrar and transfer agency located at 500 East Warm Springs Road, Suite 240, Las Vegas, Nevada 89119 having a telephone number of (702) 361-3033





State the number of shares outstanding of each of the issuer’s classes of common equity, as of November 20, 2009:  37,000,000 shares of common stock.











EXPLANATORY NOTE







On August 27, 2009, the PCAOB issued PCAOB Release No. 105-2009-006 revoking the registration of Moore & Associates, Chartered and barring Michael J. Moore, CPA, from being an associated person of a registered public accounting firm. The PCAOB imposed these sanctions on the basis of its findings concerning the alleged violations
of Moore & Associates, Chartered and Michael J. Moore of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, PCAOB rules and auditing standards in auditing the financial statements, PCAOB rules and quality controls standards, and noncooperation with a Board investigation. A copy of the PCAOB Release can be accessed at the PCAOB website at http:www.pcaobus.org.




As a result of the above action, we may not include the audit reports or consents of Moore & Associates, Chartered in any filings. Therefore, we engaged our current auditor to conduct at audit since inception through December 31, 2008.





The Company has restated its previously issued December 31, 2008, financial statements for matters related to the following previously reported item: the Company had revised the general and administrative expenses for the years ended December 31, 2008 and 2007 and for the period from Inception (September 8, 2006) through December 31, 2008
to reflect the inventory account balance that was written off on December 31, 2007, which consequently resulted in $15,771 decrease, $39,936 and $24,165 increase in net loss for the years ended December 31, 2008 and 2007 and for the period from Inception (September 8, 2006) through December 31, 2008, respectively. Cash at December 31, 2008 was corrected to reflect the use of petty cash that was no longer being replenished. This adjustment decreased cash, increased general and administrative expenses and
increased the net loss by $500.  The financial statements for the years ended December 31, 2008 and 2007 have been restated to reflect the corrections in accordance with FASB ASC 250(Prior authoritative literature: SFAS No. 154, "Accounting Change and Error Correction”).


















































2


PART I





ITEM 1.                      DESCRIPTION OF BUSINESS





GENERAL





Exclusive Apparel, Inc., (“Company”) was incorporated in the State of Nevada on September 8, 2006. Exclusive Apparel, Inc. is a developmental stage company with a principal business objective of offering premium baseball cap type headwear for women with exquisite taste and extravagant appetites as exclusive accessories to differentiate
themselves.  Exclusive Apparel, Inc is committed to producing exclusive ball-type caps that are stylish and unique that caters to a more progressive clientele.  The company will focus on baseball hat type headwear before it expands to belts, handbags and other similar accessories.





Exclusive Apparel, Inc. is a development stage company that has not significantly commenced its planned principal operations. Exclusive Apparel, Inc. operations to date have been devoted primarily to startup and development activities, which include the following:





1.
Formation of the Company;





2.
Development of the Exclusive Apparel, Inc. business plan;





3.
Conducted research on potential markets;





4.
Identified contract designer, graphic artist, sewing manufacturer, screen printer and embroider to design and manufacturer our products.





5.
Formulated multi-faceted marketing plan and marketing campaign in an effort to introduce our products to the market on a broader scope;





6.
Formulated pilot programs for prospective markets;





7.
Finalized sketches and chose fabric and materials for initial pilot production;





8.
Identified appropriate distribution channels utilizing independent sales representatives and middlemen.





Exclusive Apparel, Inc., is attempting to become operational. In order to generate revenues, Exclusive Apparel, Inc. must address the following areas:





1.
Develop and Implement a Marketing Plan:In order to penetrate our targeted market, Exclusive Apparel, Inc. will use a multi-faceted marketing plan that includes a high-end website, exclusive catalogs, and a target specific marketing campaign directed to design consultants that cater to celebrities and higher-end income clients.








3





Phase II of the marketing effort will commence once we have gained recognition among celebrities and the more affluent fashionable consumer.  The phase II plan will consist of exploiting the appropriate distribution channels using independent representatives who are experienced in accessory sales to high-end boutiques and upscale
department stores. These independent representatives work as middlemen between Exclusive Apparel and the retailer.  They are aggressive in that they will go directly to the retailers, work applicable trade shows, send samples and CAD sheets, and work directly with other accessory representatives to penetrate their desired retail accounts.  Independent Representatives are paid a commission that is typically 15% plus expenses.  Sales representatives will have a set monthly budget for
samples and supplies provided by Exclusive Apparel.





2.
Tailoring our website: Exclusive Apparel, Inc. has secured a web site domain located at www\\exclusiveapparel.biz.  The site is currently under construction and upon securing additional funding, the Company has plans to enhance the web site.





Since our inception on September 8, 2006 to December 31, 2008, the Company did not generate any significant revenues and has incurred a cumulative net loss of $209,436. The Company believes that raising $150,000 through the sale of common equity is sufficient for the company to become operational and sustain operations through the next twelve
(12) months. The capital raised has been budgeted to establish our infrastructure and to become a fully reporting company. We believe that the recurring revenues from sales of services eventually will be sufficient to support ongoing operations. Unfortunately, there can be no assurance that the actual expenses incurred will not materially exceed our estimates or that cash flow from sales will be adequate to maintain our business. As a result, our independent auditors have expressed substantial doubt about our
ability to continue as a going concern in the independent auditors’ report to the financial statements included in the registration statement.





Exclusive Apparel, Inc. currently has one officer and one director. This individual allocates time and personal resources to Exclusive Apparel, Inc. on a part-time basis.





As of the date of this report, Exclusive Apparel, Inc. has 37,000,000 shares of $0.001 par value common stock issued and outstanding.





Exclusive Apparel, Inc. has administrative offices located at 6555 W. Gary Avenue, Las Vegas, Nevada 89139.





Exclusive Apparel, Inc.’s fiscal year end is December 31.





EMPLOYEES





We have no full time employees.  Sharon M. Lynch, our President, Secretary and Treasurer has agreed to allocate a portion of her time to our activities without compensation.





ITEM 2.                      DESCRIPTION OF PROPERTY





Exclusive Apparel, Inc. uses an administrative office located at 6555 W. Gary Avenue, Las Vegas, Nevada 89139. The office space is free of charge and no lease exists. There are currently no proposed programs for the renovation, improvement or development of the facilities currently use.





Exclusive Apparel, Inc. management does not currently have policies regarding the acquisition or sale of real estate assets primarily for possible capital gain or primarily for income. Exclusive Apparel, Inc. does not presently hold any investments or interests in real estate, investments in real estate mortgages or securities of or interests
in persons primarily engaged in real estate activities.


4


ITEM 3.                      LEGAL PROCEEDINGS





There is no litigation pending or threatened by or against us.





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





None.





PART II





ITEM 5.                      MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS





On December 31, 2008, there were 29 shareholders of record of our common stock.  Our shares of common stock have never been traded on any recognized stock exchange.





DIVIDENDS





We intend to retain future earnings to support our growth.  Any payment of cash dividends in the future will be dependent upon: the amount of funds legally available therefore; our earnings; financial condition; capital requirements; and other factors which our Board of Directors deems relevant.





ITEM 7.                      MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS





Plan of Operation





On February 27, 2007 we received approval from the Securities and Exchange Commission of our Registration Statement on Form SB-2 wherein we registered 15,000,000 shares of our $.001 common stock in order to raise $150,000.00 as our initial capital prior to filing an application with the NASD on Form 211 to be listed on a public exchange.  To
date we have raised the $147,000.00 and are working on completing and submitting the Form 211 to the NASD.





Results of Operation





We did not have any operating income from inception (September 8, 2006) through December 31, 2008.  For the year ended December 31, 2008, we recognized a net loss of $21,547.  Some general and administrative expenses during the year were accrued.  Expenses for the year were comprised of costs mainly associated
with legal, accounting, and office.





Liquidity and Capital Resources





At December 31, 2008, we had no capital resources and will rely upon the issuance of common stock and additional capital contributions from shareholders to fund administrative expenses.














5





ITEM 8.                      FINANCIAL STATEMENTS





Our financial statements, together with the report of auditors, are as follows:





EXCLUSIVE APPAREL, INC.





FINANCIAL STATEMENTS





AS OF DECEMBER 31, 2008





Exclusive Apparel, Inc.


Financial Statements Table of Contents








PageINDEPENDENT AUDITORS REPORT
F-1BALANCE SHEETS
F-2STATEMENTS OF OPERATIONS
F-3STATEMENT OF STOCKHOLDERS' EQUITY
F-4STATEMENT OF CASH FLOWS
F-5FOOTNOTES TO THE FINANCIAL STATEMENTS
F-6























6





REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM




To the Board of Directors and Stockholders of Exclusive Apparel, Inc.




We have audited the accompanying balance sheets of Exclusive Apparel, Inc. as of December 31, 2008, and 2007, and the related statements of operations, stockholders' equity, and cash flows for each of the years in the two-year period ended December 31, 2008 and for the period from Inception (September 8, 2006) through December 31, 2008. Exclusive
Apparel, Inc.'s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audit.




We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged
to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit 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 Exclusive Apparel, Inc. as of December 31, 2008 and 2007, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2008 and for the period from Inception
(September 8, 2006) through December 31, 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 1 to the financial statements, the Company's significant operating losses raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.




/s/ EFP Rotenberg, LLP




EFP Rotenberg, LLP Rochester, New York November 13, 2009












































F-1





EXCLUSIVE APPAREL, INC.


(A Development Stage Company)





BALANCE SHEETS








ASSETS


December 31, 2008
(Restated)


December 31, 2007
(Restated)Current assets:Cash


$
75


$
4,611Total current assets


75



4,611$
75


$
4,611LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)Current liabilities:Accounts payable and accrued expenses

$
61


$
-Advance from shareholder


16,950



-Total current liabilities


17,011



-Stockholders' equityPreferred stock; $.001 par value, 5,000,000 sharesauthorized, zero shares issued and outstanding


-



-Common stock; $.001 par value, 70,000,000 sharesauthorized, 37,000,000 shares issued and outstanding


37,000



37,000Additional paid in capital


155,500



155,500Accumulated (deficit) during development stage


(209,436
)


(187,889
)Total stockholders' equity (deficit)


(16,936
)


4,611$
75


$
4,611














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





F-2





EXCLUSIVE APPAREL, INC.


(A Development Stage Company)





STATEMENTS OF OPERATIONS








September 8, 2006(date of inception)For the year ended


For the year ended


throughDecember 31, 2008
(Restated)


December 31, 2007
(Restated)


December 31, 2008
(Restated)Revenues

$
-


$
-


$
-Operating expenses:General and administrative expenses


21,547



163,401



209,436Total operating expenses


21,547



163,401



209,436(Loss) from operations


(21,547
)


(163,401
)


(209,436
)Other income (expenses):Interest (expense)


-



-



-Other (expense)


-



-



-Total other income (expenses)


-



-



-(Loss) before provision for income taxes


(21,547
)


(163,401
)


(209,436
)Provision for income taxes


-



-



-Net (loss)

$
(21,547
)

$
(163,401
)

$
(209,436
)Basic and diluted loss per common share

$
(0.01
)

$
(0.01
)

$
(0.01
)Basic and diluted weighted averagecommon shares outstanding


37,000,000



32,224,164



30,177,092














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





F-3





EXCLUSIVE APPAREL, INC.


(A Development Stage Company)





STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)


Accumulated(Deficit)Additional


during


TotalPreferred Stock


Common Stock


Paid-in


development


Stockholders'Shares


Amount


Shares


Amount


Capital


Stage
(Restated)


Equity (Deficit)
(Restated)Balance at September 8, 2006(Date of Inception)


-



-



-



-



-



-



-Common shares issued for service at $0.002 per share


-



-



2,000,000



2,000



2,000



-



4,000Net (loss) for the period September 8, 2006 (inception) to December 31, 2006


-



-



-



-



-



(24,488
)


(24,488
)Balance, December 31, 2006


-



-



2,000,000



2,000



2,000



(24,488
)


(20,488
)Common shares issued for service at $0.002 per share


-



-



20,000,000



20,000



20,000



-



40,000Common shares issued relating to private placement, at $0.01 per share, net of $1,500 of offering costs


-



-



15,000,000



15,000



133,500



-



148,500Net (loss) for the year ended December 31, 2007


-



-



-



-



-



(163,401
)


(163,401
)Balance, December 31, 2007


-



-



37,000,000



37,000



155,500



(187,889
)


4,611Net (loss) for the year ended December 31, 2008


-



-



-



-



-



(21,547
)


(21,547
)Balance December 31, 2008


-



-



37,000,000



37,000



155,500



(209,436
)


(16,936
)


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


F-4





EXCLUSIVE APPAREL, INC.


(A Development Stage Company)





STATEMENTS OF CASH FLOW








September 8, 2006(date of inception)For the year ended


For the year ended


throughDecember 31, 2008
(Restated)


December 31, 2007
(Restated)


December 31, 2008
(Restated)Operating activities:Net loss

$
(21,547
)

$
(163,401
)

$
(209,436
)Adjustments to reconcile net loss tonet cash used in operating activities:Stock issued for services


-



40,000



44,000Changes in operating assets and liabilities:Increase in accounts payable


61



-



61(Decrease) in accrued expenses


-



(2,800
)


-Net cash (used in) operating activities


(21,486
)


(126,201
)


(165,375
)Financing activities:Advance to/ from shareholder


16,950



(18,033
)


16,950Proceeds from issuance of common stock


-



148,500



148,500Net cash provided by financing activities


16,950



130,467



165,450Net change in cash


(4,536
)


4,266



75Cash, beginning of period


4,611



345



-Cash, end of period

$
75


$
4,611


$
75Non Cash Investing and Financing Activities:Issuance of Common Stock for Services

$
-


$
40,000


$
44,000











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








F-5


EXCLUSIVE APPAREL, INC.


(A DEVELOPMENT STAGE COMPANY)


NOTES TO FINANCIAL STATEMENTS







Note 1.  Nature of Business and Summary of Significant Accounting Policies




The summary of significant accounting policies is presented to assist in the understanding of the financial statements.  The financial statements and notes are representations of management.  These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently
applied in the preparation of the financial statements.




Nature of business and organization


Exclusive Apparel, Inc., a Nevada corporation, (hereinafter referred to as the “Company”) was incorporated in the State of Nevada on September 8, 2006.  The Company is high end clothing and apparel business that is dedicated to produce stylish and unique ball type headwear for women. The goal of Exclusive Apparel, Inc.
is to expand to belts, handbags, and other accessories. The Company's operation has been limited to general administrative operations and is considered a development stage company in accordance with Statement of Financial Accounting Standards No. 7.




Management of Company




The Company filed its articles of incorporation with the Nevada Secretary of State on September 8, 2006, indicating Sharon M. Lynch as the incorporator.  The company filed its initial list of officers and directors with the Nevada Secretary of State on September 8, 2006, indicating it’s President as Sharon M. Lynch.




Estimates


The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make certain estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.  The Company is subject to uncertainty of future events, economic, environmental
and political factors and changes in the Company's business environment; therefore, actual results could differ from these estimates.  Accordingly, accounting estimates used in the preparation of the Company's financial statements will change as new events occur, more experience is acquired, as additional information is obtained and as the Company's operating environment changes.  Changes are made in estimates as circumstances warrant.  Such changes in estimates and refinement of
estimation methodologies are reflected in the statements.




Going Concern


The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company has incurred recurring losses through December 31, 2008 and has not commenced its operations,
rather, still in the development stages, raising substantial doubt about the Company’s ability to continue as a going concern.  The Company will seek additional sources of capital through the issuance of debt or equity financing, but there can be no assurance the Company will be successful in accomplishing its objectives.




The ability of the Company to continue as a going concern is dependent on additional sources of capital and the success of the Company’s plan.  The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.




Cash and cash equivalents


Cash and cash equivalents include interest bearing and non-interest bearing bank deposits, money market accounts, and short-term instruments with a liquidation provision of three month or less.




F-6







Note 1.  Nature of Business and Summary of Significant Accounting Policies -continued




Revenue recognition


The Company has no revenues to date from its operations.  Once revenues are generated, management will establish a revenue recognition policy.




Advertising costs


Advertising costs are generally expensed as incurred and are included in selling and marketing expenses in the accompanying statement of operations.





As of December 31, 2008 and 2007, there was no advertising cost incurred.





Fair value of financial instruments


The Financial Accounting Standards Board’s Statement 107, “Disclosures about Fair Value of Financial Instruments”, requires the determination of fair value of the Company’s financial assets and liabilities.  The estimated fair values of financial instruments were determined by management using available market
information and appropriate valuation methodologies.  The carrying amounts of financial instruments including cash and advance from shareholder approximate their fair value because of their short maturities.




Income taxes


The Company accounts for its income taxes in accordance with Statement of Financial Accounting Standards No. 109, which requires recognition of deferred tax assets and liabilities for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective
tax bases and tax credit carry forwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in operations in the period that includes the enactment date.




Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial statement purposes and the amounts used for income tax purposes.  Significant components of the Company’s deferred tax liabilities and assets as of December 31, 2008 are as follows:


Deferred tax assets:Net operating loss

$
209,436Income tax rate


34
%71,208Less valuation allowance


(71,208
)$
-





Through December 31, 2008, a valuation allowance has been recorded to offset the deferred tax assets, including those related to the net operating losses.  At December 31, 2008, the Company had approximately $209,000 of federal and state net operating losses.  The net operating loss carry forwards, if not utilized
will begin to expire in 2025.


Reconciliations of the U.S. federal statutory rate to the actual tax rate for the year ended December 31, 2008 is as follows:





2008U.S. federal statutory income tax rate


34.0
%State tax - net of federal benefit


0.0
%34.0
%Increase in valuation allowance


(34.0
%)Effective tax rate


0.0
%





F-7


Note 1.  Nature of Business and Summary of Significant Accounting Policies –continued





Net loss per common share


The Company computes net loss per share in accordance with SFAS No. 128, Earnings per Share (SFAS 128) and SEC Staff Accounting Bulletin No. 98 (SAB 98).  Under the provisions of SFAS 128 and SAB 98, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average
number of shares of common stock outstanding during the period.  The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is antidilutive.




Comprehensive income


The Company accounts for comprehensive income (loss) in accordance with SFAS No. 130 "Reporting Comprehensive income" which requires comprehensive income (loss) and its components to be reported when a company has items of comprehensive income (loss).  Comprehensive income (loss) includes net income (loss) plus other comprehensive
income (loss). There are no differences or reconciling items between net income and comprehensive income for the years ended December 31, 2008 and 2007.




Note 2. Concentration of credit risk





A significant amount of the Company’s assets and resources are dependent on the financial support of the shareholders, should the shareholders determine to no longer finance the operations of the company, it may be unlikely for the company to continue.




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.  Insurance coverage for certain
retirement accounts, which include all IRA deposit accounts, will remain at $250,000 per depositor.





Note 3. Property and equipment





As of December 31, 2008 the Company does not own any property and/or equipment.




Note 4. Stockholders’ equity





The Company has 70,000,000 shares authorized and 37,000,000 shares issued and outstanding as of December 31, 2008.  The issued and outstanding shares were as follows:




On September 9, 2006 the Company issued 2,000,000 common shares at $0.002 par value to Sharon M. Lynch, the Company’s president/ shareholder for services provided.




On January 12, 2007 the Company issued 20,000,000 common shares at $0.002 par value to Sharon M. Lynch, the Company’s president/ shareholder for services provided.




The Company initiated a Private Placement in March 2007 for the sale of 15,000,000 shares of common stock to investors at $0.01 per share.  As of April 30, 2007, all subscriptions have been received from 28 investors, raising $148,500 in proceeds, net of $1,500 of offering costs. There were no common stocks issued during 2008.




F-8


Note 5.  Related party transactions




On January 12, 2007, the Company issued 20,000,000 shares of common stock to its president/ shareholder for service provided valued at approximately $40,000.




During the year ended December 31, 2008 and 2007 the Company paid consulting fee of $650 and $9,500, respectively, to an individual related to a stockholder of the Company.





During the year ended December 31, 2008, the Company paid officer’s compensation of $2,500 to its president/ shareholder for services provided.





During the year ended December 31, 2008, advance from shareholders was approximately $16,950.





Note 6. Newly issued pronouncements





In June 2009, the Financial Accounting Standards Board issued Statement of Financial Accounting Standard (“SFAS”) No. 168, "The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles”.  SFAS 168 replaces SFAS 162
and establishes the FASB Accounting Standards Codification as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with GAAP.  SFAS 168 is effective for financial statements issued for interim and annual periods ending after September 15, 2009.  The Company will adopt this standard beginning July 1, 2009. It is not believed
that this will have an impact on the Company’s financial position, results of operations or cash flows.





In June 2009, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 167 “Amendments to FASB Interpretation No. 46(R)” (“SFAS 167”). SFAS 167 improves financial reporting by enterprises involved with variable interest entities and to address (1) the effects on certain provisions of FASB Interpretation
No. 46 (revised December 2003), “Consolidation of Variable Interest Entities”, as a result of the elimination of the qualifying special-purpose entity concept in SFAS 166 and (2) constituent concerns about the application of certain key provisions of Interpretation 46(R), including those in which the accounting and disclosures under the Interpretation do not always provide timely and useful information about an enterprise’s involvement in a variable interest entity. SFAS 167 is effective as
of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. As such, the Company is required to adopt this standard beginning January 1, 2010. It is not believed that this will have an impact on the Company’s financial position, results of operations or cash flows.





In June 2009, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 166 “Accounting for Transfers of Financial Assets—an amendment of FASB Statement No. 140” (“SFAS 166”). SFAS 166 improves the relevance, representational faithfulness, and comparability of the information that a reporting
entity provides in its financial statements about a transfer of financial assets; the effects of a transfer on its financial position, financial performance, and cash flows; and a transferor’s continuing involvement, if any, in transferred financial assets. SFAS 166 is effective as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009, for interim periods within that first annual reporting period and for interim and annual reporting periods thereafter.
As such, the Company is required to adopt this standard beginning January 1, 2010.  It is not believed that this will have an impact on the Company’s financial position, results of operations or cash flows.





In May 2009, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standard (“SFAS”) No. 165, "Subsequent Events" (“SFAS 165”).  SFAS 165 establishes principles and requirements for subsequent events.  SFAS
165 is effective for interim or annual financial periods ending after June 15, 2009.  As such, the Company is required to adopt this standard beginning April 1, 2009. It is not believed that this will have an impact on the Company’s financial position, results of operations or cash flows.





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.”


F-9





Note 6. Newly issued pronouncements-continued





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.





In May 2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 163, “Accounting for Financial Guarantee Insurance Contracts-and interpretation of FASB Statement No. 60”.  SFAS No. 163 clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and
measurement of premium revenue and claims liabilities. This statement also requires expanded disclosures about financial guarantee insurance contracts. SFAS No. 163 is effective for fiscal years beginning on or after December 15, 2008, and interim periods within those years. SFAS No. 163 has no effect on the Company’s financial position, statements of operations, or cash flows at this time.





In March 2008, the Financial Accounting Standards Board, or FASB, issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133.  This standard requires companies to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how
derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. This Statement is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. The Company has not yet adopted the provisions of SFAS No. 161, but does not expect
it to have a material impact on its  financial position, results of operations or cash flows.





Note 7. Litigation




As of December 31, 2008, the Company is not aware of any current or pending litigation which may affect the Company’s operations.




Note 8 - Restatement




The Company has restated its previously issued December 31, 2008, financial statements for matters related to the following previously reported item: the Company had revised the general and administrative expenses for the years ended December 31, 2008 and 2007 and for the period from Inception (September 8, 2006) through December 31, 2008
to reflect the inventory account balance that was written off on December 31, 2007, which consequently resulted in $15,771 decrease, $39,936 and $24,165 increase in net loss for the years ended December 31, 2008 and 2007 and for the period from Inception (September 8, 2006) through December 31, 2008, respectively. Cash at December 31, 2008 was corrected to reflect the use of petty cash that was no longer being replenished. This adjustment decreased cash, increased general and administrative expenses and
increased the net loss by $500.  The financial statements for the years ended December 31, 2008 and 2007 have been restated to reflect the corrections in accordance with FASB ASC 250(Prior authoritative literature: SFAS No. 154, "Accounting Change and Error Correction”).


F-10





ITEM 9.                      CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE





On August 7, 2009 the Board of Directors of Exclusive Apparel dismissed Moore & Associates, Chartered, Certified Public Accountants, and engaged the services of Seale and Beers, CPA as its independent auditor.  On September 22, 2009 the Board of Directors of Exclusive Apparel dismissed Seale and Beers, CPA as its independent
auditor, and engaged the services of Rotenberg & Co., LLP as its independent auditor.  On October 1, 2009 Rotenberg and Company LLP merged with another CPA firm, EFP Group, to form a new firm.  All of the partners and employees of Rotenberg and Company LLP and EFP Group joined the new firm, EFP Rotenberg LLP.  EFP Rotenberg LLP succeeds Rotenberg and Company LLP as the independent registered public accounting firm for Exclusive Apparel, Inc. At no time have there been any disagreements
with any accountants regarding any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure.




On August 27, 2009, the PCAOB issued PCAOB Release No. 105-2009-006 revoking the registration of Moore & Associates, Chartered and barring Michael J. Moore, CPA, from being an associated person of a registered public accounting firm. The PCAOB imposed these sanctions on the basis of its findings concerning the alleged violations
of Moore & Associates, Chartered and Michael J. Moore of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, PCAOB rules and auditing standards in auditing the financial statements, PCAOB rules and quality controls standards, and noncooperation with a Board investigation. A copy of the PCAOB Release can be accessed at the PCAOB website at http:www.pcaobus.org.




As a result of the above action, we may not include the audit reports or consents of Moore & Associates, Chartered in any filings. Therefore, we engaged our current auditor to conduct at audit since inception through December 31, 2008.





ITEM 9A.                      CONTROLS AND PROCEDURES





Management’s Report On Internal Control Over Financial Reporting





Our management is responsible for establishing and maintaining adequate internal control over financial reporting.  Internal control over financial reporting is defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process designed by, or under the supervision of, the company’s principal
executive and principal financial officers and effected by the company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that:





-
Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company;


-
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and


-
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements.





Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies
or procedures may deteriorate.  All internal control systems, no matter how well designed, have inherent limitations.  Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.  Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However,
these inherent limitations are known features of the financial reporting process.  Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.





As of December 31, 2008 management assessed the effectiveness of our internal control over financial reporting based on the criteria for effective internal control over financial reporting established in Internal Control--Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") and SEC guidance
on conducting such assessments.  Based on that evaluation, they concluded that, during the period covered by this report, such internal controls and procedures were not effective to detect the inappropriate application of US GAAP rules as more fully described below.  This was due to deficiencies that existed in the design or operation of our internal controls over financial reporting that adversely affected our internal controls and that may be considered to be material weaknesses.


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The matters involving internal controls and procedures that our management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of
directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives; and (3) ineffective controls over period end financial disclosure and reporting processes.  The aforementioned material weaknesses were identified by our Chief Executive Officer in connection with the review of our financial statements as of December 31, 2008.





Management believes that the material weaknesses set forth in items (2) and (3) above did not have an effect on our financial results.  However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment
and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.





This annual report does not include an attestation report of the Corporation's registered public accounting firm regarding internal control over financial reporting.  Management's report was not subject to attestation by the Corporation's registered public accounting firm pursuant to temporary rules of the SEC that permit the Corporation
to provide only the management's report in this annual report.





Management’s Remediation Initiatives





In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:





We will create a position to segregate duties consistent with control objectives and will increase our personnel resources and technical accounting expertise within the accounting function when funds are available to us.  And, we plan to appoint one or more outside directors to our board of directors who shall be appointed to an
audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us.





Management believes that the appointment of one or more outside directors, who shall be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on our Board.





We anticipate that these initiatives will be at least partially, if not fully, implemented by September 30, 2009.  Additionally, we plan to test our updated controls and remediate our deficiencies by September 30, 2009.




ITEM 9B.  CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING





There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.





This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting.  Management’s report was not subject to attestation by the Company’s 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 on Form 10-K.





PART III





ITEM 10.                      DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS: COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT





The directors and officers as of November 20, 2009, are set forth below.  The directors hold office for their respective term and until their successors are duly elected and qualified.  Vacancies in the existing Board are filled by a majority vote of the remaining directors.  The officers serve at the will of
our Board of Directors


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Name
Age
Positions and Offices HeldGeorgette Mathers
56
President/Secretary/Director





Sharon M. Lynch served as the President, Secretary, and Director of Exclusive Apparel, Inc. through June 2009 and was still the President, Secretary and Director of the Company up to December 31, 2008.





BUSINESS EXPERIENCE





Set forth below is the name of our director and officer, all positions and offices held, the period during which he has served as such, and the business experience during at least the last five years:





Sharon M. Lynch, President, Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, Secretary, Treasurer, and Director:





Sharon Lynch is a graduate of The Fashion Institute of Design and Merchandising in Los Angeles and has 20 years of experience in sales and marketing of wholesale and retail apparel and accessories.  Ms. Lynch has worked for prestigious companies such as Nike, Inc., Ellen Tracy, Inc. and St. John Knits.  From 1987 to 1991
she held a position as an account executive for Ellen Tracy and was responsible for the Nordstrom account which consisted of working with 26 buyers to cover 70 plus retail stores nationwide.  These duties included showroom sales, merchandising seminars for groups of ten to two hundred sales associates. She also effectively maintained sell-through of goods, co-op advertising and markdown allowances for key accounts.  From 1991 to 1995, Ms. Lynch held a position as Product Developer for Nike,
Inc. in Beaverton, Oregon.  In this position, she was responsible for the following:  execution of the development of promotional apparel and accessories for the sports marketing division from initial concept to production confirmation, collaboration with R & D and marketing to establish quality products on short timelines to meet profitable price-points, negotiating price and timelines with selected vendors and contractors to stay within budget constraints and was directly responsible
for forecasting project costs and purchasing goods and services with regard to sports marketing and apparel product marketing business plans.  From 1995 to 1998, Ms. Lynch worked for World Wide Golf Events and directed turnkey golf events from conception to completion.  These duties included the design and development of marketing materials to promote start-up golf event coordination, acquiring procurement for corporate and charitable golf tournaments and securing sponsor participation from
companies such as Microsoft, Fluor Daniels, Comp USA, Cubic Balance, Cobra Golf, Ashworth, Avid and Nike.





In 1998, Ms. Lynch left the industry on a full time basis to raise a family and is now returning to launch Exclusive Apparel, Inc.





Effective June 11, 2009, the board of directors appointed Georgette Mathers to fill a vacancy on the board of directors.





In addition, Sharon M. Lynch, the Company’s President, Chief Executive Officer, Chief Financial Officer, Treasurer, Secretary and Director resigned from the board of directors and resigned as the Company’s President, Chief Executive Officer, Chief Financial Officer, Treasurer and Secretary.  Georgette Mathers was appointed
as the Company’s President, Chief Executive Officer, Chief Financial Officer and Secretary.  Ms. Lynch’s resignation as both an officer and director was not the result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices.





Georgette Mathers, 56 years of age, President, Chief Executive Officer, Chief Financial Officer, Secretary and Director.





Ms. Mathers is a corporate paralegal and has worked in the legal profession for over 20 years.





As of the date of this filing, there has not been any material plan, contract or arrangement (whether or not written) to which Ms. Mathers is a party in connection with this appointment as a director and an officer of this Company.





No transactions occurred in the last two years to which the Company was a party in which Ms. Mathers had or is to have a direct or indirect material interest.





CERTAIN LEGAL PROCEEDINGS





No director, nominee for director, or executive officer has appeared as a party in any legal proceeding material to an evaluation of his ability or integrity during the past five years.





COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT





To date, we have not filed Form 5 for the year ended December 31, 2008.


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ITEM 11.                      EXECUTIVE COMPENSATION





Since Exclusive Apparel, Inc., Inc.’s incorporation on September 8, 2006, Exclusive Apparel, Inc. has not paid any compensation to any officer, director, or employee. Upon securing minimum placement proceeds, Exclusive Apparel, Inc. has budgeted $2,000 per month as compensation for Mrs. Sharon M. Lynch.  Exclusive apparel
does not have employment agreements. The Board of Directors will determine future compensation and, as appropriate, employment agreements executed.





No retirement, pension, profit sharing, stock option or insurance programs or other similar programs have been adopted by us for the benefit of our employees.





ITEM 12.                      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT





We have issued a total of 22,000,000 shares of our common stock to the following persons for services:





Name
Number of Total Shares
% of ShareholdingsSharon M. Lynch
22,000,000
59%





The address for Ms. Lynch is 2620 Regatta Drive, Suite 102, Las Vegas, Nevada 89128.





ITEM 13.                      CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS





On September 9, 2006 Sharon M. Lynch, President, Secretary, Treasurer, and Director, received 2,000,000 shares of Exclusive Apparel, Inc., Inc. common stock, par value $0.001 per share, for services.





All shares issued to Mrs. Sharon M. Lynch were at a par price per share of $0.001. The price of the common stock issued to Mrs. Sharon M. Lynch was arbitrarily determined and bore no relationship to any objective criterion of value. At the time of the issuance, Exclusive Apparel, Inc. was recently formed or in the process of being
formed and possessed no assets.





On September 12, 2006 Sharon M. Lynch, President, Secretary, Treasurer, and Director, received 20,000,000 shares of Exclusive Apparel, Inc., Inc. common stock, par value $0.001 per share, for services.





All shares issued to Mrs. Sharon M. Lynch were at a par price per share of $0.001. The price of the common stock issued to Mrs. Sharon M. Lynch was arbitrarily determined and bore no relationship to any objective criterion of value.  At the time of the issuance, Exclusive Apparel, Inc. possessed no assets.





During the year ended December 31, 2007, the Company purchased $42,000 of inventories which was subsequently written off from LVNV Apparel, LLC, a company related by common ownership.





During the year ended December 31, 2007, the Company paid consulting fee of $9,500 to an individual related to a stockholder of the Company.





During the year ended December 31, 2008 and 2007 the Company paid consulting fee of $650 and $9,500, respectively, to an individual related to a stockholder of the Company.





During the year ended December 31, 2008, the Company paid officer’s compensation of $2,000 to its president/ shareholder for services provided.





During the year ended December 31, 2008, advance from shareholders was approximately $16,950.




Exclusive Apparel, Inc., Inc.’s principal office space is free of charge at the present time.  Please refer to the section titled “Description of Property” herein.




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PART IV





ITEM 14.                      EXHIBITS AND REPORTS ON FORM 8-K





(a)  The following documents are filed as part of this report:





1.   Financial statements; see index to financial statements and schedules in Item 8 herein.





2    Financial statement schedules; see index to financial statements and schedules in Item 8 herein.





3.   Exhibits:





The following exhibits are filed with this Form 10-K and are identified by the numbers indicated; see index to exhibits immediately following financial statements and schedules of this report.








EXHIBIT INDEX





3.1   Articles of Incorporation    (1)


3.2   By-laws    (1)





(1)
Incorporated by reference to our Form SB-2 (SEC File No. 333-140305).





ITEM 14.                      PRINCIPAL ACCOUNTANT FEES AND SERVICES





Audit Fees





For the Company's fiscal year ended December 31, 2008, we were billed $8,750 for year end 2008 for professional services rendered for the audit and review of our financial statements.





For the Company’s reaudit of fiscal year ended December 31, 2008, we were billed $4,500 for professional services rendered for the reaudit and review of our financial statements.




Tax Fees





For the Company's fiscal year ended December 31, 2008, we were billed approximately $0.00 for 2008, respectively, for professional services rendered for tax compliance, tax advice, and tax planning.





All Other Fees





The Company did not incur any other fees related to services rendered by our principal accountant for the fiscal year ended December 31, 2008.




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SIGNATURES





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








EXCLUSIVE APPAREL, INC.Date: November 23, 2009
By: /s/ Georgette MathersGeorgette MathersChief Executive Officer







Pursuant to the requirements of the Securities and 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(s)
Date/s/ Georgette Mathers
Chief Executive Officer and Director
November 23, 2009Georgette Mathers
(Principal Executive Officer)/s/ Georgette Mathers
Chief Financial Officer and Director
November 23, 2009Georgette Mathers
(Principal Financial and Accounting Officer)

















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