Global Gate Property Corp. - FORM 10-K/A

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EX-32.1 - EXHIBIT 32.1 - Global Gate Property Corp.	globalby10ka1123109x32_12111.htm
EX-31.1 - EXHIBIT 31.1 - Global Gate Property Corp.	globalby10ka1123109x31_12111.htm

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 1 to

FORM 10-K

[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2009

[] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Commission File No. 000-52330

BY DESIGN, INC.

(Exact Name of Small Business Issuer as specified in its charter)

Nevada	20-3305472
(State or other jurisdiction	(IRS Employer File Number)
of incorporation)


2519 East Kentucky Ave.
Denver, CO	80209
(Address of principal executive offices)	(zip code)

(303) 660-6964

(Registrant's telephone number, including area code)

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 per share par value

Indicate by check mark if registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [] No [X].

Indicate by check mark if registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act.

Yes [] No [X].

Indicate by check mark whether the registrant (1) has filed all Reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes: [X] No: [ ]

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

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-K is contained in this form and no disclosure will 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. [X]

Indicate by check mark whether the registrant is a large accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “small reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer []	Accelerated filer []
Non-accelerated filer [] (Do not check if a smaller reporting company)	Smaller reporting company [X]

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

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter: approximately $79,000.

EXPLANATORY NOTE

This Amendment No.1 to our Annual Report on Form 10-K includes restated audited consolidated financial statements for the years ended December 31, 2008 and 2009, which includes changes to the Company’s Balance Sheet at December 31, 2008 and 2009, its Statement of Operations for the years ended December 31, 2008 and 2009 and its Statements of Stockholders Equity for the period from January 1, 2008 to December 31, 2009 with respect to the correct accounting for the Company’s noncontrolling interest in its 51% owned subsidiary. This Amendment speaks as of the original filing date of our Annual Report on Form 10-K and has not been updated to reflect events occurring subsequent to the original filing date.

FORM 10-K/A

By Design, Inc.

INDEX

PART I	Page

Item 1. Description of Business	3

Item 1A. Risk Factors	6

Item 2. Description of Property	12

Item 3. Legal Proceedings	12

Item 4. Submission of Matters to a Vote of Security Holders	12

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	12

Item 6. Selected Financial Data	14

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations	15

Item 7A. Quantitative and Qualitative Disclosures About Market Risk	18

Item 8. Financial Statements and Supplementary Data	18

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures	19

Item 9A(T). Controls and Procedures	19

Item 9B. Other Information	20

PART III

Item 10. Directors, Executive Officers and Corporate Governance	20

Item 11. Executive Compensation	21

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	21

Item 13. Certain Relationships and Related Transactions, and Director Independence	22

Item 14. Principal Accountant Fees and Services	22

Item 15. Exhibits Financial Statement Schedules	23

Financial Statements pages	F-1 to F-15

Signatures	24

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For purposes of this document, unless otherwise indicated or the context otherwise requires, all references herein to “BYDE,” “By Design,” “we,” “us,” and “our,” refer to By Design, Inc., a Nevada corporation and our wholly-owned subsidiaries. Except as we might otherwise specifically indicate, all references to us include our subsidiaries.

Forward-Looking Statements

The following discussion contains forward-looking statements regarding us, our business, prospects and results of operations that are subject to certain risks and uncertainties posed by many factors and events that could cause our actual business, prospects and results of operations to differ materially from those that may be anticipated by such forward-looking statements. Factors that may affect such forward-looking statements include, without limitation: our ability to successfully develop new products and services for new markets; the impact of competition on our revenues, changes in law or regulatory requirements that adversely affect or preclude clients from using us for certain applications; delays our introduction of new products or services; and our failure to keep pace with our competitors.

When used in this discussion, words such as "believes", "anticipates", "expects", "intends" and similar expressions are intended to identify forward-looking statements, but are not the exclusive means of identifying forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. We undertake no obligation to revise any forward-looking statements in order to reflect events or circumstances that may subsequently arise. Readers are urged to carefully review and consider the various disclosures made by us in this report and other reports filed with the Securities and Exchange Commission that attempt to advise interested parties of the risks and factors that may affect our business.

PART I

Item 1. DESCRIPTION OF BUSINESS.

General

We are a Nevada corporation. Our principal business address is 2519 East Kentucky Ave., Denver, Colorado 80209. Our telephone number is (303) 660-6964. We were incorporated under the laws of the State of Nevada on February 23, 2005. We have active operations. We market interior and exterior design consulting services to real estate developers and builders for their real estate projects. The sale of these consulting services includes our recommendations for the purchase of accessories and architectural elements to be included or placed in the residential and commercial spaces, as built or retrofitted. These consulting services and associated products will be sold through By Design, Inc. We currently have no active projects in By Design, Inc.

We have a subsidiary known as Stone Select, LLC which markets hand-carved interior and exterior natural stone ornamentation and architectural elements Stone Select, LLC’s principal products consist of fireplace surrounds, kitchen range hoods, flooring, base and case trim materials, exterior ornamentation, fountains, planters, , and exterior window and door surrounds. At the present time, most of the sales of Stone Select, LLC come from natural stone fireplace surrounds, kitchen range hoods, and trim materials. At the present time, all of our revenues are generated through our subsidiary, Stone Select, LLC. We currently operate exclusively in the Denver, Colorado Metropolitan area. We market and sell all of our products and services to commercial and residential builders and interior designers. Our target market is a custom home in the three to twenty million dollar price range. We have no website but Stone Select, LLC operates a website at www.stoneselect,us.

We were incorporated as a successor to an operation which began in 1996. The predecessor company was a sole proprietorship owned by Ms. Deanie Underwood also known as “By Design.” This company provided interior design and refurbishment work similar to the present company and averaged two to three clients per year but had no activity in the two years prior to be being acquired by us. It was marginally profitable in most years it was operational. This company has been absorbed into us and is no longer in existence. We acquired the assets of this sole proprietorship in a tax-free exchange under the Internal Revenue Code in February, 2005.

In July, 2005, we completed a registered offering of our common shares under the provisions of the Colorado securities laws and under an exemption from the federal securities laws. We sold a total of 197,802 common shares at a price of $0.50 per share to a total of forty investors. We raised a total of $98,901 in this offering.

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We have not been subject to any bankruptcy, receivership or similar proceeding.

Organization

As of December 31, 2009, we are comprised of one corporation with one majority-owned subsidiary, Stone Select, LLC., and a wholly-owned subsidiary, Stone Select Imports, Inc. Unaffiliated third parties, Craig and Susie Bush, collectively own 49% of Stone Select, LLC. We have ownership and voting control of 51% of Stone Select, LLC. All of our operations are conducted through Stone Select, LLC. Stone Select Imports, Inc. currently has no operations, and we have no plans to conduct any operations in the future.

Operations

Our original focus is in the Denver, Colorado metropolitan area, but we plan to expand throughout the State of Colorado. We focus in the broad area of interior design for homes, including the wholesale and in retail sales of imported stone, decorative iron, and carved wood furniture. Our activities include both working with remodeling projects by contractors and new construction by real estate developers. We can act as a fee-based consultant to our clients in their various projects. We can market interior design consulting services to real estate developers for their real estate projects. The sale of these consulting services includes our recommendations for the purchase of accessories to be placed in the spaces where we may assemble the interiors. These consulting services and associated products will be sold through By Design, Inc. We plan to charge a fixed hourly fee to be negotiated on a case-by-case basis. We would also mark up the cost of any products which we would sell in connection with our interior design consulting services. We currently have no active projects and generate no revenue in By Design, Inc.

We have a subsidiary known as Stone Select, LLC which markets hand-carved interior and exterior natural stone ornamentation and architectural elements. Stone Select, LLC’s principal products consist of fireplace surrounds, kitchen range hoods, flooring, including base and case, and window and door surrounds. At the present time, most of the sales of Stone Select, LLC come from fireplace surrounds and kitchen range hoods and trim materials. At the present time, all of our revenues are generated through our subsidiary, Stone Select, LLC. We currently operate exclusively in the Denver, Colorado Metropolitan area. We market and sell all of our products and services to commercial and residential builders and interior designers. We sell our products between the manufacturer and customer and carry limited inventories, for direct sale and as sample products for order. Our target market is a custom home in the three to twelve million dollar price range. We have no website, but Stone Select, LLC operates a website at www.stoneselect,us.

We market and sell all of our products and services to commercial and residential builders and interior designers. Our target market is a custom home in the three to twenty million dollar price range.

We currently work with four main clients: Trillium Homes; Landmark Homes; Bond General Contractors; and Casey Jones, home contractor. All are private companies doing construction in the Denver, Colorado market. Each of these four developers builds custom homes in the three to twenty million dollar price range. In addition, to a lesser degree, we also work with Mesa Properties and Alexander Homes, who are also private companies doing construction in the Denver, Colorado market. We continuously look for referrals from builders and architects who work in this target market. One of the architects with whom we work is Mr. Craig Bush, who, with his wife, own 49% of Stone Select, LLC. We have no website, but Stone Select, LLC operates a website at www.stoneselect,us.

We import all of our products from China. We have one supplier in China. All of the products are sold on a custom design basis. As a result, we do not carry a substantial inventory of products.

At the present time, we have no plans to raise any additional funds within the next twelve months. Any working capital will be expected to be generated from internal operations. In the event that we need additional capital, Ms. Underwood has agreed to loan such funds as may be necessary through December 31, 2010 for working capital purposes. However, we reserve the right to examine possible additional sources of funds, including, but not limited to, equity or debt offerings, borrowings, or joint ventures. Limited market surveys have never been conducted to determine demand for our products and services. Therefore, there can be no assurance that any of its objectives will be achieved.

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In addition we plan to expand through acquisition. We will not only look at our present industry but will reserve the right to investigate and, if warranted, merge with or acquire the assets or common stock of an entity actively engaged in business which generates revenues. We will seek opportunities for long-term growth potential as opposed to short-term earnings. As of the date hereof, we have no business opportunities under investigation. None of our officers, directors, or affiliates have engaged in any preliminary contact or discussions with any representative of any other company regarding the possibility of an acquisition or merger between us and such other company.

Markets

Our marketing plan is focused completely on developing our customer base and individual projects. We utilize the expertise of our officers to develop our business. In addition, we continually identify commercial - light industrial real estate space adequate for displaying stone, iron, and carved wood products for use by the interior design and construction trades.

Each Officer and Director utilizes his or her previous contacts in business to develop potential opportunities.

Raw Materials

We do not use raw materials in our business. We acquire finished products from our two suppliers. However, the use of and ability to acquire raw materials could be a material factor in our operations if our suppliers cannot obtain sufficient raw materials to provide us with finished products. However, we have found raw materials to be readily available and not a material factor at the present time.

Clients and Competition

We currently work with four main clients, who are custom builders: Trillium Homes; Landmark Homes; Bond General Contractors; and Casey Jones, home contractor. All are private companies doing construction in the Denver, Colorado market. Each of these four developers builds custom homes in the three to twenty million dollar price range. In addition, to a lesser degree, we also work with Mesa Properties and Alexander Homes, who are also private companies doing construction in the Denver, Colorado market.

With respect to our four main clients, we rely upon them collectively for a majority of our revenues. In 2009, sales to Stone Select, LLC.’s four largest customer were approximately 55% of its total net sales, with the largest customer accounting for approximately 20% of sales, and the others between 10% and 13%. In 2008, sales to Stone Select, LLC.’s four largest customer were also approximately 55% of its total net sales, with the largest customer accounting for approximately 20% of sales, and the others between 10% and 13%. Each of these four developers builds custom homes in the three to twelve million dollar price range and are affected by market trends in that segment of the real estate industry. We believe that we have a good relationship with each of them. Mr. Craig Bush, who, with his wife, own 49% of Stone Select, LLC., provides architectural services to our clients from time to time. However, their use of our products remains dependent upon their ability to market homes. We also receive referrals from contractors for remodeling and new construction.

Backlog

At December 31, 2009, we had no backlogs.

Employees

We have two full-time employees, our President, Ms. Deanie Underwood, President and Mr. Bradley Underwood, Secretary-Treasurer. None of our employees draws a salary. We reimburse our employees for all necessary and customary business related expenses.

We have no plans or agreements which provide health care, insurance or compensation on the event of termination of employment or change in our control.

We do not pay our Directors separately for any Board meeting they attend.

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Proprietary Information

We own no proprietary information.

Government Regulation

Since we are associated with the real estate industry, all of our projects have and will require local governmental approval with respect to zoning and construction code compliance. We will only require government approval on a project-by-project basis and only when we have projects pending. The extent of the approval varies with the project and the jurisdiction and cannot be quantified except as it relates to specific projects.

We believe the effect of complying with existing or probable governmental regulations is a managed cost of our business operations but could be significant. Each real estate project requires prior government approval. However, the cost cannot be quantified except as it relates to specific projects.

We believe that the cost of compliance with federal, state and local environmental laws will not be significant because we do not plan to choose projects which are subject to significant environmental costs or regulations. In any case, we plan to choose our projects to minimize the effects of governmental regulations. At the present time, we are not awaiting any governmental approvals.

Research and Development

We have never spent any amount in research and development activities.

Environmental Compliance

We believe that we are not subject to any material costs for compliance with any environmental laws.

How to Obtain Our SEC Filings

We file annual, quarterly, and special reports, proxy statements, and other information with the Securities Exchange Commission (SEC). Reports, proxy statements and other information filed with the SEC can be inspected and copied at the public reference facilities of the SEC at 100 F Street N.E., Washington, DC 20549. Such material may also be accessed electronically by means of the SEC's website at www.sec.gov.

Our investor relations department can be contacted at our principal executive office located at our principal office, located at 2519 East Kentucky Ave., Denver, Colorado 80209. Our telephone number is (303) 660-6964.

Item 1A. RISK FACTORS.

You should carefully consider the risks and uncertainties described below and the other information in this document before deciding to invest in shares of our common stock.

The occurrence of any of the following risks could materially and adversely affect our business, financial condition and operating result. In this case, the trading price of our common stock could decline and you might lose all or part of your investment.

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We have had a history of losses. Although we are profitable in our most recent two fiscal years, our losses may continue in the future. We have a large working capital deficit and a negative stockholders equity, which increased from the previous year. We may never sustain profitability on a consistent basis. As a result, we could go out of business.

Our revenues for the fiscal year ended December 31, 2009 were $283,881. We had a net profit of $6,423 for this period. Our revenues for the fiscal year ended December 31, 2008 were $610,992. We had a net profit of $61,217 for this period. We have had a history of losses because we were unable to generate sufficient revenues to be profitable. At December 31, 2009 we had a working capital deficit and a negative stockholders equity of $334,206. At December 31, 2008 we had negative stockholders equity of $211,043. We have been profitable in our most recent two fiscal years. We cannot guarantee that we will continue to be a profitable company. We may never become profitable on a consistent basis, and, as a result, we could go out of business.

Because we have a large working capital deficit, our accountants have expressed doubts about our ability to continue as a going concern.

For the fiscal years ended December 31, 2009 and 2008, our accountants have expressed doubt about our ability to continue as a going concern as a result of our working capital deficit. Our ability to achieve and maintain profitability and positive cash flow is dependent upon:

●	our ability to locate clients who will purchase our products and use our services; and

●	our ability to generate significant revenues.

Based upon current plans, we may incur operating losses in future periods because we may, from time to time, be incurring expenses but not generating sufficient revenues. We expect approximately $135,000 in operating costs over the next twelve months. We cannot guarantee that we will be successful in generating sufficient revenues or other funds in the future to cover these operating costs. Failure to generate sufficient revenues will cause us to go out of business.

We are only minimally capitalized. Because we are only minimally capitalized, we expect to experience a lack of liquidity for the foreseeable future in our ongoing operations. We will adjust our expenses as necessary to prevent cash flow or liquidity problems. However, we expect we will need additional financing of some type, which we do not now possess, to fully develop our operations. We expect to rely principally upon our ability to raise additional financing, the success of which cannot be guaranteed. We will look at both equity and debt financing, including loans from our principal shareholder. However, at the present time, we have no definitive plans for financing in place, other than the funds which have previously been loaned to us by Ms. Underwood. In the event that we need additional capital, Ms. Underwood has agreed to loan such funds as may be necessary through December 31, 2010 for working capital purposes. To the extent that we experience a substantial lack of liquidity, our development in accordance with our proposed plan may be delayed or indefinitely postponed, our operations could be impaired, we may never become profitable, fail as an organization, and our investors could lose some or all of their investment.

Our limited operating history makes it difficult for us to evaluate our future business prospects and make decisions based on those estimates of our future performance. As a result, an investor could lose his entire investment.

The concept for our business was developed in 1996. However, we had no revenues from 2003 until 2006. Even though we have operated as a corporation since 2005, we have a limited operating history. This factor makes it difficult to evaluate our business on the basis of historical operations. As a consequence, our past results may not be indicative of future results. Although this is true for any business, it is particularly true for us because of our limited operating history. Reliance on historical results may hinder our ability to anticipate and timely adapt to increases or decreases in sales, revenues or expenses. For example, if we overestimate our future sales for a particular period or periods based on our historical growth rate, we may increase our overhead and other operating expenses to a greater degree than we would have if we correctly anticipated the lower sales level for that period and reduced our controllable expenses accordingly. If we make poor budgetary decisions as a result of unreliable historical data, we could continue to incur losses, which may result in a decline in our stock price.

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Our operations are subject to our ability to successfully market our services and products. We have no substantial history of being able to successfully market our services and products. If we cannot successfully market our services and products, we may never become profitable and an investor could lose his entire investment.

Our operations will depend, among other things, upon our ability to develop and to market our services and products to the residential and commercial builders. We market interior and exterior design consulting services to real estate developers and builders for their real estate projects. The sale of these consulting services includes our recommendations for the purchase of accessories and architectural elements to be included or placed in the residential and commercial spaces, as built or retrofitted. These consulting services and associated products will be sold through By Design, Inc. Our subsidiary, known as Stone Select, LLC, markets hand-carved interior and exterior natural stone ornamentation and architectural elements. Stone Select, LLC’s principal products consist of fireplace surrounds, kitchen range hoods, flooring, base and case trim materials, exterior ornamentation, fountains, planters, , and exterior window and door surrounds. At the present time, most of the sales of Stone Select, LLC come from natural stone fireplace surrounds, kitchen range hoods, and trim materials. At the present time, most of the sales of Stone Select, LLC come from fireplace surrounds, kitchen range hoods, and trim materials. If we cannot find a combination of sufficient customers for our consulting services and purchasers of the hand-carved interior and exterior natural stone ornamentation and architectural elements sold through Stone Select, LLC, we may have difficulty maintaining profitability. An investor could lose his entire investment.

We have limited experience as a public company.

We have limited experience as a public company. We have limited experience in complying with the various rules and regulations which are required of a public company. As a result, we may not be able to operate successfully as a public company, even if our operations are successful. We plan to comply with all of the various rules and regulations which are required of a public company. However, if we cannot operate successfully as a public company, your investment may be materially adversely affected. Our inability to operate as a public company could be the basis of your losing your entire investment in us.

There are factors beyond our control which may adversely affect us. Any, all, or a combination of general market conditions and changing consumer tastes could cause an investor could lose his entire investment

Our operations may also be affected by factors which are beyond our control, principally general market conditions and changing consumer tastes. Any of these problems, or a combination thereof, could have affect on our viability as an entity. We may not maintain profitability, fail as an organization, and our investors could lose some or all of their investment.

Intense competition in our market could prevent us from developing revenue and prevent us from achieving annual profitability. In either situation, we may not maintain profitability, fail as an organization, and our investors could lose some or all of their investment.

We are organized to provide defined interior design services to our clients through By Design, Inc. and sell stone products through our subsidiary, Stone Select, LLC. The barriers to entry are not significant. All aspects of our business are highly competitive. We face strong competitors in all areas of our business. Our services and products could be rendered noncompetitive or obsolete. Any increase in competition may cause us to lose market share or compel us to reduce prices to remain competitive, which could result in reduced margins for our products. Competitive pressures may not only impair our margins but may also impact our revenues and our growth. Almost all of our competitors are larger than us and have greater financial resources than we do. Many of them have substantially greater experience in interior design. Increased competition with these companies could curtail price increases or could require price reductions or increased spending on marketing and sales, any of which could adversely affect our results of operations. Competition from larger and more established companies is a significant threat and is expected to increase.

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We currently have only one main supplier. The loss it would have a negative effect on our business.

We currently purchase finished products from only one supplier. This supplier provides us with essentially the same inventory which we sell through Stone Select, LLC., which are hand-carved interior and exterior natural stone ornamentation and architectural elements. These are fireplace surrounds, kitchen range hoods, flooring, including base and case, and window surrounds. The loss of our supplier would have a negative effect on our business because we would not have sufficient inventory to sell. If we cannot replace the lost supplier, we would see a severe decline in revenue from the sale of products. As a result, we may never become profitable, fail as an organization, and our investors could lose some or all of their investment.

Fluctuations in the supply and prices of raw materials could negatively impact our financial results.

Under normal market conditions, these materials are generally available on the open market. From time to time, however, the prices and availability of these raw materials may fluctuate significantly, which could impair our ability to procure necessary products, or increase the cost of our products. If material costs increase, and we are unable to pass along, or are delayed in passing along, those increases to our customers, we will experience reductions to our profit margins and our ability to generate a profit will be reduced or eliminated completely.

Many of our customers are in cyclical industries, which may affect the demand for our products.

Many of our customers, especially for our commercial products, are in businesses and industries that are cyclical in nature and sensitive to changes in general economic conditions. As a result, the demand for our products by these customers depends, in part, upon general economic conditions. Downward economic cycles affecting the industries of our customers will reduce sales of our products. If general economic conditions deteriorate, we may suffer reductions in our sales and profitability. To date, we have not seen the slowdown in the housing market affect us, but it could. A general slowdown in the housing market may affect everyone, including us, which would reduce our ability to generate a profit.

The industry in which we operate are highly competitive. Our principal competitor is larger and has greater financial resources than we do.

We operate in a very competitive industry. Our principal competitor, Materials Marketing, Inc., of Denver, Colorado, is larger and has greater financial resources than we do. However, we potentially compete with a diverse group of competitors ranging from internet businesses to traditional brick-and-mortar companies, many of which have greater resources than we do. We believe that barriers to entry in this business are not significant and start-up costs are relatively low, so our competition may increase in the future. Our belief that there are minimal barriers to entry is based on our observation that operations such as ours do not require the ownership of warehouses, showrooms or factories to operate, which we think is because (i) our direct ship business can be operated with minimal warehousing needs and costs, which are significantly less than traditional models, (ii) wholesale product orders can be placed after receipt of client orders, in order to further reduce warehousing needs, (iii) samples can be shown to clients at little or no cost, without the necessity of showroom space for actual product, (iv) if a competitor wants showroom space, it is typically available for lease at competitive rates in most United States markets, and (v) all manufacturing can be done by third party suppliers, so there is no need to own or lease a manufacturing facility. New competitors may be able to launch new businesses similar to ours, and current competitors may replicate our business model, at a relatively low cost. If competitors with significantly greater resources than ours decide to replicate our business model, they may be able to quickly gain recognition and acceptance of their business methods, products and services through marketing and promotion. We may not have the resources to compete effectively with current or future competitors. If we are unable to effectively compete, we will lose sales to our competitors and our revenues will decline.

We import all of our products from China. As a result, all of our current revenues come from products imported from outside the United States.

We expect imports from international markets to continue to represent a significant portion of our products. Accordingly, our business is subject to risks related to the differing legal, political, social and regulatory requirements and economic conditions of many jurisdictions. Risks inherent in international operations include the following:

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	●	agreements may be difficult to enforce and receivables owed to us difficult to collect;

	●	foreign customers may have longer payment cycles;

	●	foreign countries may impose additional withholding taxes or otherwise tax our foreign income, or adopt other restrictions on foreign trade or investment, including currency exchange controls;

	●	foreign operations may experience staffing difficulties and labor disputes;

	●	transportation and other shipping costs may increase;

	●	foreign governments may nationalize private enterprises;

	●	unexpected adverse changes in export duties, quotas and tariffs and difficulties in obtaining export licenses;

	●	intellectual property rights may be more difficult to enforce;

	●	fluctuations in exchange rates may affect product demand and may adversely affect the profitability in U.S. dollars of products we import where payment for our products is made in the local currency;

	●	general economic conditions in the countries in which we operate could have an adverse effect on operations in those countries;

	●	our business and profitability in a particular country could be affected by political or economic repercussions on a domestic, country specific or global level from terrorist activities and the response to such activities;

	●	unexpected adverse changes in foreign laws or regulatory requirements may occur; and

	●	compliance with a variety of foreign laws and regulations may be burdensome.

We have certain key customers.

Our relationships with certain key residential building customers are important to us and our subsidiary, Stone Select, LLC. Stone Select, LLC. has four major customers. In 2008, sales to Stone Select, LLC.’s four largest customer were approximately 55% of its total net sales, with the largest customer accounting for approximately 20% of sales, and the others between 10% and 13%. In 2007, sales to Stone Select, LLC.’s four largest customer were also approximately 55% of its total net sales, with the largest customer accounting for approximately 20% of sales, and the others between 10% and 13%. Although Stone Select, LLC. sells various types of products through various channels of distribution, we believe that the loss of a substantial portion of Stone Select, LLC.’s sales to residential builders could have a significant affect impact on our ability to be profitable.

Our success will be dependent upon our management’s efforts. We cannot sustain profitability without the efforts of our management.

Our success will be dependent upon the decision making of our directors and executive officers. These individuals intend to commit as much time as necessary to our business, but this commitment is no assurance of success. The loss of any or all of these individuals, particularly Ms. Deanie Underwood, our President, could have a material, adverse impact on our operations. We have no written employment agreements with any officers and directors, including Ms. Underwood. We have not obtained key man life insurance on the lives of any of our officers or directors.

Our stock price may be volatile, and you may not be able to resell your shares at or above the public sale price.

There has been, and continues to be, a limited public market for our common stock. Although our common stock is quoted on the Over-the-Counter Bulletin Board, an active trading market for our shares has not, and may never develop or be sustained. If you purchase shares of common stock, you may not be able to resell those shares at or above the initial price you paid. The market price of our common stock may fluctuate significantly in response to numerous factors, some of which are beyond our control, including the following:

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*	actual or anticipated fluctuations in our operating results;

*	changes in financial estimates by securities analysts or our failure to perform in line with such estimates;

*	changes in market valuations of other interior design oriented companies, particularly those that market services such as ours;

*	announcements by us or our competitors of significant innovations, acquisitions, strategic partnerships, joint ventures or capital commitments;

*	introduction of product enhancements that reduce the need for our products or services;

*	the loss of one or more key clients; and

*	departures of key personnel.

Of our total outstanding shares as of March 25, 2010, a total of 9,000,000, or approximately 98%, will be restricted from immediate resale but may be sold into the market in the near future. This could cause the market price of our common stock to drop significantly, even if our business is doing well.

As restrictions on resale end, the market price of our stock could drop significantly if the holders of restricted shares sell them or are perceived by the market as intending to sell them.

Because our stock is traded on the Over-the-Counter Bulletin Board, it has a limited public trading market. As a result, it may be difficult or impossible for you to liquidate your investment.

While our common stock currently is listed for trading, we have had only a few trades. We are quoted on the Over-the-Counter Bulletin Board under the trading symbol BYDE. We cannot assure that such a market will improve in the future, even if our securities are listed on the NASD Bulletin Board. The NASD Bulletin Board requires that we be a reporting company under the Securities Exchange Act of 1934. However, we cannot guarantee that we will be accepted for listing on the NASD Bulletin Board. Further, we cannot assure that an investor will be able to liquidate his investment without considerable delay, if at all. If a more active market does develop, the price may be highly volatile. Our limited operating history, lack of profitability, negligible stock liquidity, potential extreme price and volume fluctuations, and regulatory burdens may have a significant impact on the market price of the common stock. It is also possible that the relatively low price of our common stock may keep many brokerage firms from engaging in transactions in our common stock.

Applicable SEC rules governing the trading of “Penny Stocks” limit the liquidity of our common stock, which may affect the trading price of our common stock.

Our common stock is currently quoted on the Over-the-Counter Bulletin Board. Since our common stock continues to trade well below $5.00 per share, our common stock is considered a “penny stock” and is subject to SEC rules and regulations that impose limitations upon the manner in which our shares can be publicly traded. These regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock and the associated risks. Under these regulations, certain brokers who recommend such securities to persons other than established customers or certain accredited investors must make a special written suitability determination for the purchaser and receive the written purchaser’s agreement to a transaction prior to purchase. These regulations have the effect of limiting the trading activity of our common stock and reducing the liquidity of an investment in our common stock.

- 11 -

Buying low-priced penny stocks is very risky and speculative.

The shares being offered are defined as a penny stock under the Securities and Exchange Act of 1934, and rules of the Commission. The Exchange Act and such penny stock rules generally impose additional sales practice and disclosure requirements on broker-dealers who sell our securities to persons other than certain accredited investors who are, generally, institutions with assets in excess of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000, or $300,000 jointly with spouse, or in transactions not recommended by the broker-dealer. For transactions covered by the penny stock rules, a broker-dealer must make a suitability determination for each purchaser and receive the purchaser's written agreement prior to the sale. In addition, the broker-dealer must make certain mandated disclosures in penny stock transactions, including the actual sale or purchase price and actual bid and offer quotations, the compensation to be received by the broker-dealer and certain associated persons, and deliver certain disclosures required by the Commission. Consequently, the penny stock rules may affect the ability of broker-dealers to make a market in or trade our common stock and may also affect your ability to resell any shares you may purchase in the public markets.

We do not expect to pay dividends on common stock.

We have not paid any cash dividends with respect to our common stock, and it is unlikely that we will pay any dividends on our common stock in the foreseeable future. Earnings, if any, that we may realize will be retained in the business for further development and expansion.

ITEM 2. DESCRIPTION OF PROPERTY.

We rent office space at $1,500 per month under a verbal lease, and yard and warehouse space at approximately $2,100 per month plus costs under a non-cancellable lease with an unaffiliated third party, and no stated renewal option expiring in March 2012. We own office equipment to furnish our offices. We own a truck and a forklift which we use in our business. All of our management activities are performed in Colorado.

ITEM 3. LEGAL PROCEEDINGS.

We are not a party to any material legal proceedings, nor is our property the subject of any material legal proceeding.

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

We held no shareholders meeting in the fourth quarter of our fiscal year.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Holders

As of March 1, 2010, there were 83 record holders of our common stock and there were 9,197,802 shares of our common stock outstanding.

Market Information

Our shares of common stock are quoted on the Over-the-Counter Bulletin Board under the trading symbol BYDE. The shares became trading on July 25, 2006 but there is no extensive history of trading. The bid and asked price has been $ 0.25 and $1.10 during the entire time the shares have been quoted. The quotations reflect interdealer prices, without retail mark-up, mark-down or commission, and may not represent actual transactions.

- 12 -

Equity Compensation Plan Information

We have no outstanding stock options or other equity compensation plans.

The Securities Enforcement and Penny Stock Reform Act of 1990

The Securities Enforcement and Penny Stock Reform Act of 1990 require additional disclosure and documentation related to the market for penny stock and for trades in any stock defined as a penny stock. Unless we can acquire substantial assets and trade at over $5.00 per share on the bid, it is more likely than not that our securities, for some period of time, would be defined under that Act as a "penny stock." As a result, those who trade in our securities may be required to provide additional information related to their fitness to trade our shares. These requirements present a substantial burden on any person or brokerage firm who plans to trade our securities and would thereby make it unlikely that any liquid trading market would ever result in our securities while the provisions of this Act might be applicable to those securities.

Any broker-dealer engaged by the purchaser for the purpose of selling his or her shares in us will be subject to Rules 15g-1 through 15g-10 of the Securities and Exchange Act. Rather than creating a need to comply with those rules, some broker-dealers will refuse to attempt to sell penny stock.

The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the Commission, which:

·	contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading;

·	contains a description of the broker's or dealer's duties to the customer and of the rights and remedies available to the customer with respect to a violation to such duties or other requirements of the Securities Act of 1934, as amended;

·	contains a brief, clear, narrative description of a dealer market, including "bid" and "ask" prices for penny stocks and the significance of the spread between the bid and ask price;

·	contains a toll-free telephone number for inquiries on disciplinary actions;

·	defines significant terms in the disclosure document or in the conduct of trading penny stocks; and

·	contains such other information and is in such form (including language, type, size and format) as the Securities and Exchange Commission shall require by rule or regulation;

The broker-dealer also must provide, prior to effecting any transaction in a penny stock, to the customer:

·	the bid and offer quotations for the penny stock;

·	the compensation of the broker-dealer and its salesperson in the transaction;

·	the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and

·	monthly account statements showing the market value of each penny stock held in the customer's account.

In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitability statement. These disclosure requirements will have the effect of reducing the trading activity in the secondary market for our stock because it will be subject to these penny stock rules. Therefore, stockholders may have difficulty selling their securities.

- 13 -

Stock Transfer Agent

The stock transfer agent for our securities is Corporate Stock Transfer of Denver, Colorado. Their address is 3200 Cherry Creek Drive South, Suite 430, Denver, Colorado 80209. Their phone number is (303)282-4800.

Dividend Policy

We have not previously declared or paid any dividends on our common stock and do not anticipate declaring any dividends in the foreseeable future. The payment of dividends on our common stock is within the discretion of our board of directors. We intend to retain any earnings for use in our operations and the expansion of our business. Payment of dividends in the future will depend on our future earnings, future capital needs and our operating and financial condition, among other factors that our board of directors may deem relevant. We are not under any contractual restriction as to our present or future ability to pay dividends.

ITEM 6. SELECTED FINANCIAL DATA

A smaller reporting company is not required to provide the information in this Item.

- 14 -

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

This Management’s Discussion and Analysis contains forward-looking statements that involve future events, our future performance and our expected future operations and actions. In some cases, you can identify forward-looking statements by the use of words such as “may”, “will”, “should”, “anticipate”, “believe”, “expect”, “plan”, “future”, “intend”, “could”, “estimate”, “predict”, “hope”, “potential”, “continue”, or the negative of these terms or other similar expressions. These forward-looking statements are only our predictions and involve numerous assumptions, risks and uncertainties. Our actual results or actions may differ materially from these forward-looking statements for many reasons, including, but not limited to, the matters discussed in this report under the caption “Risk Factors”. We urge you not to place undue reliance on these forward-looking statements, which speak only as of the date of this prospectus. We undertake no obligation to publicly update any forward looking-statements, whether as a result of new information, future events or otherwise.

The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes included in this report.

The following table provides selected financial data about us for the years ended December 31, 2009 and 2008. For detailed financial information, see the audited Financial Statements included in this document.

Balance Sheet Data: 12/31/09

Cash	$	15,960
Total assets	$	93,722
Total liabilities	$	427,928
Shareholders' equity	$	(334,206)

Operating Data: 12/31/09

Revenue	$	283,881
Operating Expenses	$	133,014
Net Income	$	6,423

- 15 -

Balance Sheet Data: 12/31/08

Cash	$	39,979
Total assets	$	196,481
Total liabilities	$	407,524
Shareholders' equity	$	(211,043)

Operating Data: 12/31/08

Revenue	$	610,992
Operating Expenses	$	138,604
Net Income	$	61,217

Results of Operations

Our accountants have expressed doubt about our ability to continue as a going concern as a result of our continued net losses. Our ability to achieve and maintain profitability and positive cash flow is dependent upon our ability to locate clients who will purchase our products and use our services and our ability to generate revenues.

The revenues for all of the relevant periods in this discussion came from sales of products in our subsidiary, Stone Select, LLC. We had no revenues from our interior design consulting operated through By Design, Inc. We currently have no active projects and generate no revenue in By Design, Inc. but continue to look for potential projects.

For the twelve months ended December 31, 2009, sales were $283,881. For the twelve months ended December 31, 2008, sales were $610,992. We were involved in fewer projects in 2008 compared to 2008 and generated less revenue.

Our revenues decreased from 2008 to 2009 primarily because of the general decline in construction projects in the Denver area. We had no revenues from our interior design consulting operated through By Design, Inc. We currently have no active projects and generate no revenue in our By Design, Inc. but continue to look for potential projects. Our ability to attract new clients is related to our marketing efforts, including the use of referrals.

For the twelve months ended December 31, 2009, cost of goods sold were $173,156, as compared to $390,760 for the twelve months ended December 31, 2008. Costs of goods sold include all direct costs incurred in selling products. In addition, in 2009, we wrote off a substantial portion of our inventory, which is shown as a separate line item. We do not separate sales of different product lines into operating segments. Our cost of goods decreased in 2009 compared to 2008 principally because of fewer projects.

The difference between sales and cost of goods sold is gross profit. Our gross profit for the twelve months ended December 31, 2009, was $110,725, as compared to gross profit for the twelve months ended December 31, 2008 of $220,232.

- 16 -

Operating expenses, which include depreciation and general and administrative expenses for the twelve months ended December 31, 2009 were $133,014. Our operating expenses for the twelve months ended December 31, 2008 were $138,604. The major components of operating expenses include rent, marketing costs, professional fees, which consist of legal and accounting costs, and telephone expenses. In 2008, we had significantly lower general and administrative expenses than previous years, which was a result of better cost controls for marketing and professional fees. We maintained the trend in 2009. However, we took a write-down of inventory in 2009 in the amount of $31,523. We sold the inventory on a liquidation basis. We have no other material inventory write-offs which we anticipate in the future.

Each at December 31, 2009 and December 31, 2008, we had one payable due to Ms. Underwood for $358,686 and $341,747, respectively, for working capital advances made to us. This payable is due on demand, is an oral agreement and unsecured. In 2007 we agreed to accrue interest on the advances at 6% per annum. Interest expense under this agreement at December 31, 2008 and 2009 was $40,481 and $61,176, respectively. We have no ability at the current time to repay related party advances. In the event that we need additional capital, Ms. Underwood has agreed to loan such funds as may be necessary through December 31, 2010 for working capital purposes. We also recorded compensation expense of $500 per month in 2008 for administrative and management services donated to us by officers, and $250 per month for office space donated by an officer. Total donated services expense for 2008 was $9,000.

As a result of the foregoing, we had net income of $6,423 for the twelve months ended December 31, 2009 compared to a net income of $61,217 for the twelve months ended December 31, 2008.

We believe that the potential sales for 2010 does not look better than 2009 because the current construction market. As a result, our potential sales could be closer to our 2009 numbers than those of 2008. However, it is too early to predict with certainty. We currently have a policy of acquiring inventory for specific projects, as opposed to ordering the inventory and attempting to market it. Also, we feel that we have implemented better controls over our operating expenses. Because we do not pay salaries, operating expenses are expected to remain fairly constant with respect to sales except for costs associated with marketing. Hence each additional sale and correspondingly the gross profit of such sale have minimal offsetting operating expense. Thus, additional sales should become a profit at a higher return on sales rates as a result of not needing to expand our operational expenses at the same pace. We plan to continue to focus our marketing on the Denver Metropolitan area through referrals for 2010, so we do not believe that our marketing costs will increase substantially through the second quarter of 2010.

To try to operate at a break-even level based upon our current level of anticipated business activity, we believe that we must generate approximately $300,000 in revenue per year. However, if our forecasts are inaccurate, we will need to raise additional funds. In the event that we need additional capital, Ms. Underwood has agreed to loan such funds as may be necessary through December 31, 2010 for working capital purposes.

On the other hand, we may choose to scale back our operations to operate at break-even with a smaller level of business activity, while adjusting our overhead to meet the revenue from current operations. In addition, we expect that we will need to raise additional funds if we decide to pursue more rapid expansion, the development of new or enhanced services and products, appropriate responses to competitive pressures, or the acquisition of complementary businesses or technologies, or if we must respond to unanticipated events that require us to make additional investments. We cannot assure that additional financing will be available when needed on favorable terms, or at all.

We expect to incur operating losses in future periods because we will be incurring expenses and not generating sufficient revenues. We expect approximately $135,000 in operating costs over the next twelve months. We cannot guarantee that we will be successful in generating sufficient revenues or other funds in the future to cover these operating costs. Failure to generate sufficient revenues or additional financing when needed could cause us to go out of business.

Liquidity and Capital Resources

As of December 31, 2009, we had cash or cash equivalents of $15,690, compared to $39,979 in cash or cash equivalents as of December 31, 2008.

- 17 -

Net cash provided by operating activities was $100,567 for the twelve months ended December 31, 2009, compared to net cash used for operating activities of $44,245 for the twelve months ended December 31, 2008.

Cash flows used for investing activities were $-0- for the twelve months ended December 31, 2009 compared to $-0- for the twelve months ended December 31, 2008.

Cash flows used for financing activities were $124,586 for the twelve months ended December 31, 2009 compared to cash flows provided by financing activities of $32,700 for the twelve months ended December 31, 2008. These cash flows were all related to borrowings from related parties.

We believe that we have sufficient capital in the short term for our current level of operations. This is because we believe that we can attract sufficient product sales and services within our present organizational structure and resources to become profitable in our operations. Additional resources would be needed to expand into additional locations, which we have no plans to do at this time. We do not anticipate needing to raise additional capital resources in the next twelve months. In the event that we need additional capital, Ms. Underwood has agreed to loan such funds as may be necessary through December 31, 2010 for working capital purposes.

Our principal source of liquidity will be our operations. We expect variation in revenues to account for the difference between a profit and a loss. Also business activity is closely tied to the economy of Denver and the U.S. economy. Because we currently only sell stone products, a slow down in purchases of construction materials have had a negative impact to our business in the latter half of 2009. We have no idea to what extent this may affect us in 2010, but do not expect construction activity to increase. In any case, we try to operate with minimal overhead. Our primary activity will be to seek to develop clients and, consequently, our sales. If we succeed in expanding our client base and generating sufficient sales, we will become profitable. We cannot guarantee that this will ever occur. Our plan is to build our company in any manner which will be successful.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements with any party.

Recently Issued Accounting Pronouncements

We do not expect the adoption of any recently issued accounting pronouncements to have a significant impact on our net results of operations, financial position, or cash flows.

Seasonality

We do not expect our sales to be impacted by seasonal demands for our products and services.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.

A smaller reporting company is not required to provide the information in this Item.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

Our consolidated financial statements of commencing on page F-1 are included with this prospectus. These financial statements have been prepared on the basis of accounting principles generally accepted in the United States and are expressed in US dollars.

- 18 -

BY DESIGN, INC.

CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2008 and 2009

F - 1

TABLE OF CONTENTS

	Page

REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM	F-3


CONSOLIDATED FINANCIAL STATEMENTS

Consolidated balance sheets	F-4
Consolidated statements of operations	F-5
Consolidated statements of stockholders’ equity	F-6
Consolidated statements of cash flows	F-7
Notes to consolidated financial statements	F-9

F - 2

RONALD R. CHADWICK, P.C.

Certified Public Accountant

2851 South Parker Road, Suite 720

Aurora, Colorado 80014

Telephone (303)306-1967

Fax (303)306-1944

Email: rcpc35@hotmail.com

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors

By Design, Inc.

Denver, Colorado

I have audited the accompanying consolidated balance sheets of By Design, Inc. as of December 31, 2008 and 2009, and the related consolidated statements of operations, stockholders' equity and cash flows for the years then ended. These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these financial statements based on my audit.

I conducted my audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated 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. I believe that my audit provides a reasonable basis for my opinion.

In my opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of By Design, Inc. as of December 31, 2008 and 2009, and the consolidated results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note 7 to the financial statements, the Company determined in 2010 that the 2008 and 2009 financial statements should have reported noncontrolling interest pursuant to ASC 810-10-65. Accordingly, the 2008 and 2009 financial statements have been restated.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 6 to the financial statements the Company has a working capital deficit that raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to this matters is also described in Note 6. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Aurora, Colorado	/s/ Ronald R. Chadwick, P.C.
November 15, 2010	RONALD R. CHADWICK, P.C.

F - 3

BY DESIGN, INC.
CONSOLIDATED BALANCE SHEETS



	Dec. 31, 2008			Dec. 31, 2009
	(as Restated)			(as Restated)

ASSETS

Current assets
Cash	$	39,979		$	15,960
Accounts receivable		49,153			-
Inventory		41,109			21,315
Total current assets		130,241			37,275

Fixed assets		88,828			88,828
Less accumulated depreciation		(26,688	)		(36,481	)
Other assets		4,100			4,100
		66,240			56,447

Total Assets	$	196,481		$	93,722


LIABILITIES & STOCKHOLDERS' EQUITY

Current liabilities
Accounts payable	$	4,495		$	-
Related party payables		11,939			-
Related party advances		341,747			358,686
Accrued interest payable		40,481			61,176
Other liabilities		8,862			8,066
Total current liabilties		407,524			427,928

Total Liabilities		407,524			427,928

Stockholders' Equity (Deficit)
By Design, Inc. stockholders' equity (deficit)
Preferred stock, $.01 par value;
1,000,000 shares authorized;
No shares issued & outstanding		-			-
Common stock, $.001 par value;
50,000,000 shares authorized;
9,197,802 shares issued
& outstanding		9,198			9,198
Additional paid in capital		90,803			9,691
Accumulated deficit		(205,355	)		(219,499	)
Total By Design, Inc. stockholders' equity (deficit)		(105,354	)		(200,610	)
Noncontrolling interest		(105,689	)		(133,596	)

Total Stockholders' Equity (Deficit)		(211,043	)		(334,206	)

Total Liabilities and Stockholders' Equity (Deficit)	$	196,481		$	93,722

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

F - 4

BY DESIGN, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)


	Year Ended			Year Ended
	Dec. 31, 2008			Dec. 31, 2009
	(as Restated)			(as Restated)


Sales	$	610,992		$	283,881
Cost of goods sold		390,760			173,156

Gross profit		220,232			110,725

Operating expenses:
Amortization & depreciation		9,793			9,793
General and administrative		128,811			91,698
Write offs - inventory					31,523
		138,604			133,014
Other operating items:
Collection of previously written off receivables		-			49,407
					49,407

Income from operations		81,628			27,118

Other income (expense):
Interest expense		(20,411	)		(20,695	)
		(20,411	)		(20,695	)

Income before
provision for income taxes		61,217			6,423

Provision for income tax		-			-

Net income		61,217			6,423
Less: Net (income) loss attributable to
noncontrolling interest		(53,583	)		(20,567	)
Net income (loss) attributable
to common stockholders	$	7,634		$	(14,144	)

Net income (loss) per share (By Design, Inc.)
(Basic and fully diluted)	$	0.00		$	(0.00	)

Weighted average number of
common shares outstanding		9,197,802			9,197,802

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

F - 5

BY DESIGN, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

	Common Stock
			Amount		Paid in			Accumulated			Stockholders' Equity (Deficit)-			Non- controlling			Total Stockholders'
	Shares		($.001 Par)		Capital			Deficit			By Design, Inc.			Interest			Equity (Deficit)
					(As Restated)			(As Restated)			(As Restated)			(As Restated)


Balances at December 31, 2007		9,197,802	$	9,198	$	110,803		$	(212,989	)	$	(92,988	)	$	(139,272	)	$	(232,260	)

Distributions						(20,000	)					(20,000	)		(20,000	)		(40,000	)

Net income (loss) for the year									7,634			7,634			53,583			61,217

Balances at December 31, 2008		9,197,802	$	9,198	$	90,803		$	(205,355	)	$	(105,354	)	$	(105,689	)	$	(211,043	)

Distributions						(81,112	)					(81,112	)		(48,474	)		(129,586	)

Net income (loss) for the year									(14,144	)		(14,144	)		20,567			6,423

Balances at December 31, 2009		9,197,802	$	9,198	$	9,691		$	(219,499	)	$	(200,610	)	$	(133,596	)	$	(334,206	)

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

F - 6

BY DESIGN, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS



	Year Ended			Year Ended
	Dec. 31, 2008			Dec. 31, 2009

Cash Flows From Operating Activities:
Net income (loss)	$	61,217		$	6,423

Adjustments to reconcile net loss to
net cash used for
operating activities:
Amortization & depreciation		9,793			9,793
Accounts receivable		(32,658	)		49,153
Inventory					(11,729	)
Accrued payables		24,081			15,404
Write offs					31,523
Other liabilities		(18,188	)
Net cash provided by (used for)
operating activities		44,245			100,567


Cash Flows From Investing Activities:

Net cash provided by (used for)
investing activities		-			-

(Continued On Following Page)

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

F - 7

BY DESIGN, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS


(Continued From Previous Page)

	Year Ended			Year Ended
	Dec. 31, 2008			Dec. 31, 2009

Cash Flows From Financing Activities:
Related party advances - borrowings		7,300			5,000
Paid in capital - distributions		(40,000	)		(129,586	)
Net cash provided by
financing activities		(32,700	)		(124,586	)

Net Increase (Decrease) In Cash		11,545			(24,019	)

Cash At The Beginning Of The Period		28,434			39,979

Cash At The End Of The Period	$	39,979		$	15,960


Schedule Of Non-Cash Investing And Financing Activities

None


Supplemental Disclosure

Cash paid for interest	$	-		$	-
Cash paid for income taxes	$	-		$	-

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

F - 8

BY DESIGN, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2008 and 2009

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

By Design, Inc. (the “Company”), was incorporated in the State of Nevada on February 23, 2006. The Company was formed to market and supply home design products to residential and commercial builders and developers. The Company may also engage in any other business permitted by law, as designated by the Board of Directors of the Company.

Principles of consolidation

The accompanying consolidated financial statements include the accounts of By Design, Inc. and its 51% owned subsidiary. All intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents.

Accounts receivable

The Company reviews accounts receivable periodically for collectability and establishes an allowance for doubtful accounts and records bad debt expense when deemed necessary. At December 31, 2008 and 2009 the Company had no balance in its allowance for doubtful accounts.

Property and equipment

Property and equipment are recorded at cost and depreciated under the straight line method over each item's estimated useful life.

Minority Interest (Noncontrolling interest)

The Company’s subsidiary has minority members, representing ownership interests of 49% at December 31, 2008 and 2009. The Company accounts for these minority, or noncontrolling interests pursuant to ASC 810-10-65 whereby gains or losses in a subsidiary with a noncontrolling interest are allocated to the noncontrolling interest based on the ownership percentage of the noncontrolling interest, even if that allocation results in a deficit noncontrolling interest balance.

F - 9

BY DESIGN, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2008 and 2009

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

Inventories

Inventories, consisting of building materials, are stated at the lower of cost or market (first-in, first-out method). Costs capitalized to inventory include the purchase price, transportation costs, and any other expenditures incurred in bringing the goods to the point of sale and putting them in saleable condition. Costs of good sold include those expenditures capitalized to inventory.

Revenue recognition

Revenue is recognized on an accrual basis as earned under contract terms. Specifically, revenue from product sales is recognized subsequent to a customer ordering a product at an agreed upon price, delivery has occurred, and collectability is reasonably assured.

Advertising costs

Advertising costs are expensed as incurred. The Company recorded no advertising costs in 2008 and $4,000 in 2009.

Income tax

The Company accounts for income taxes pursuant to ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

F - 10

BY DESIGN, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2008 and 2009

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

Net income (loss) per share

The net income (loss) per common share is computed by dividing the net income (loss) attributable to common stockholders by the weighted average number of shares of common outstanding. Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any), are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per common share.

Financial Instruments

The carrying value of the Company’s financial instruments, as reported in the accompanying balance sheets, approximates fair value.

Long-Lived Assets

In accordance with ASC 350, the Company regularly reviews the carrying value of intangible and other long-lived assets for the existence of facts or circumstances, both internally and externally, that may suggest impairment. If impairment testing indicates a lack of recoverability, an impairment loss is recognized by the Company if the carrying amount of a long-lived asset exceeds its fair value.

Products and services, geographic areas and major customers

The Company earns revenue from the sale of building materials, but does not separate sales of different product lines into operating segments. All sales each year were domestic and to external customers.

NOTE 2. RELATED PARTY TRANSACTIONS

The Company at December 31, 2008 and 2009 had a payable due to a Company officer of $341,747 and $358,686 for due on demand, unsecured, working capital advances made to the Company. Prior to 2008 the advances were non-interest bearing. In 2008 the Company agreed to accrue interest on the advances at 6% per annum. Interest expense under this agreement in 2008 and 2009 was $20,411 and $20,695 with accrued interest payable at December 31, 2008 and 2009 of $40,481 and $61,176. The Company also recorded compensation expense of $500 per month in 2008 for administrative and management services donated to the Company by officers, and $250 per month for office space donated by an officer. Total donated services expense for 2008 was $9,000.

F - 11

BY DESIGN, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2008 and 2009

NOTE 3. INCOME TAXES

Deferred income taxes arise from the temporary differences between financial statement and income tax recognition of net operating losses. These loss carryovers are limited under the Internal Revenue Code should a significant change in ownership occur.

At December 31, 2008 and 2009 the Company had net operating loss carryforwards of approximately $107,000 and $131,000 which begin to expire in 2025. The deferred tax asset of $42,000 and $51,000 created by the net operating losses has been offset by a 100% valuation allowance. The change in the valuation allowance in 2008 and 2009 was $(7,081) and $9,257.

NOTE 4. FIXED ASSETS

Fixed asset values recorded at cost are as follows:

	2008			2009

Furniture & fixtures	$	9,927		$	9,927
Shop equipment		6,420			6,420
Computer equipment		4,928			4,928
Leasehold improvements		67,553			67,553
		88,828			88,828
Less accumulated depreciation		(26,688	)		(36,481	)
Total	$	62,140		$	52,347

Depreciation expense in 2008 and 2009 was $9,793 each year.

NOTE 5. LEASE COMMITMENT

The Company rents office space at $1,500 per month under a verbal lease, and yard and warehouse space at approximately $2,100 per month plus costs under a non-cancellable lease with no stated renewal option expiring in March 2012. Rent expense under all leases for 2008 and 2009 was $47,473 and $53,462. Minimum future rent expenses by year from December 31, 2009 forward under the leases are: 2010 $25,536, 2011 $25,536, and 2012 $6,384 ($57,456 total).

F - 12

BY DESIGN, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2008 and 2009

NOTE 6. GOING CONCERN

The Company has a large working capital deficit. This condition raises substantial doubt about the Company’s ability to continue as a going concern. The Company may raise additional capital through the sale of its equity securities, through offerings of debt securities, or through borrowings from financial institutions. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern.

NOTE 7. RESTATEMENT OF FINANCIAL STATEMENTS

The Company has reviewed the accounting treatment as it relates to the noncontrolling interest in its 51% owned subsidiary’s earnings. As a result of this review, management has determined that the accounting for noncontrolling interest as it related to its subsidiary was incorrect and not in accordance with the provisions of Statement of Financial Accounting Standard No. 160, Noncontrolling interest in Consolidated Financial Statements – an amendment of ARB No. 51, superseded by ASC 810-10-65 (the “Standard”), adopted by the Company on January 1, 2009. The Standard provides that losses allocable to noncontrolling interest in a subsidiary may exceed the noncontrolling member’s interest in the subsidiary’s equity. The excess, and any further losses allocable to the noncontrolling interest, shall be allocated to the noncontrolling member’s interest even if that allocation results in a deficit noncontrolling interest balance. Prior to the adoption of the Standard, ARB 51 prohibited the allocation of losses to a noncontrolling interest if that allocation resulted in a deficit noncontrolling interest balance.

This change in accounting treatment resulted in a restatement of accumulated deficit, additional paid in capital and noncontrolling interest on the Company’s balance sheets as of December 31, 2008 and 2009, and noncontrolling interest and net income (loss) attributable to common stockholders on the Company’s statements of operations for the years then ended.

F - 13

BY DESIGN, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2008 and 2009

NOTE 7. RESTATEMENT OF FINANCIAL STATEMENTS (Continued):

The restatement had no impact on total assets, liabilities or cash flows. A summary of the effects of the restatement as of December 31, 2008 and 2009, and for the years then ended are as follows:

	As Previously
	Reported			Restatement			As Restated

Balance Sheets

December 31, 2008

Additional paid in capital	$	48,903		$	41,900		$	90,803
Accumulated deficit		(269,144	)		63,789			(205,355	)
Noncontrolling interest		-			(105,689	)		(105,689	)

December 31, 2009

Additional paid in capital	$	(80,683	)	$	90,374		$	9,691
Accumulated deficit		(262,721	)		43,222			(219,499	)
Noncontrolling interest		-			(133,596	)		(133,596	)

Statements of Operations

Year ended December 31, 2008

Net income	$	61,217		$	-		$	61,217
Less: Net (income) loss attributable to
noncontrolling interest		-			(53,583	)		(53,583	)
Net income attributable to
common stockholders		-			7,634			7,634
Basic and diluted income per
common share		0.01			(0.01	)		0.00

Year ended December 31, 2009

Net income	$	6,423		$	-		$	6,423
Less: Net (income) loss attributable to
noncontrolling interest		-			(20,567	)		(20,567	)
Net loss attributable to
common stockholders		-			(14,144	)		(14,144	)
Basic and diluted income (loss) per
common share		0.00			-			(0.00	)

F - 14

BY DESIGN, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2008 and 2009

NOTE 7. RESTATEMENT OF FINANCIAL STATEMENTS (Continued):

	As Previously
	Reported			Restatement			As Restated

Statements of Stockholders’ Equity

Year ended December 31, 2008

Paid in capital	$	48,903		$	41,900		$	90,803
Accumulated deficit		(269,144	)		63,789			(205,355	)
Noncontrolling interest		-			(105,689	)		(105,689	)

Year ended December 31, 2009

Additional paid in capital	$	(80,683	)	$	90,374		$	9,691
Accumulated deficit		(262,721	)		43,222			(219,499	)
Noncontrolling interest		-			(133,596	)		(133,596	)

F - 15

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

We did not have any disagreements on accounting and financial disclosures with our present accounting firm during the reporting period.

ITEM 9A(T). CONTROLS AND PROCEDURES.

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Under the supervision and with the participation of our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the Exchange Act). Accordingly, we concluded that our disclosure controls and procedures as defined in Rule 13a-15(e) under the Exchange Act were not effective to ensure that information required to be disclosed in reports we file or submit under the Exchange Act is recorded, processed, and summarized and reported within the time periods specified in SEC rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions as appropriate to allow timely decisions regarding required disclosure. Our Chief Executive Officer and Chief Financial Officer had previously concluded that our disclosure controls and procedures were effective as of December 31, 2009. However, in connection with the restatement of our Consolidated Financial Statements as of and for the year ended December 31, 2009 as fully described in Note 7 to the Consolidated Financial Statements included in Item 8 of this Form 10-K/A, our Chief Executive Officer and Chief Financial Officer determined that the material weakness described below existed as of December 31, 2009.

A material weakness is a control deficiency, or combination of control deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. Our Chief Executive Officer and Chief Financial Officer concluded that as of December 31, 2009, we did not maintain effective controls with respect to the correct accounting for our noncontrolling interest in our 51% owned subsidiary. This control deficiency resulted in the restatement of our Consolidated Financial Statements for the years ended December 31, 2008 and 2009. Accordingly, our Chief Executive Officer and Chief Financial Officer has determined that this control deficiency constitutes a material weakness.

Management’s Annual Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) and 15d-(f) under the Exchange Act. Our internal control over financial reporting are designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with U. S. generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:

i. pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

ii. provide reasonable assurance that transactions are recorded as necessary to permit the preparation of our consolidated financial statements in accordance with U. S. generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and

iii. provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements.

Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2009. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework.

Management has concluded that our internal control over financial reporting was not effective as December 31, 2009.

Inherent Limitations Over Internal Controls

Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations, including the possibility of human error and circumvention by collusion or overriding of controls. Accordingly, even an effective internal control system may not prevent or detect material misstatements on a timely basis. Also, 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.

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Changes in Internal Control Over Financial Reporting

We have made no change in our internal control over financial reporting during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Attestation Report of the Registered Public Accounting Firm.

This annual report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our independent registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management's report in this annual report on Form 10-K.

ITEM 9B. OTHER INFORMATION.

Nothing to report.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE

Set forth below are the names of our sole director and officer, all positions and offices held with us, the period during which she has served as such, and the business experience during at least the last five years:

Name	Age	Positions and Offices Held

Deanie J. Underwood	54	President, Chief Executive Officer, Secretary-Treasurer, Chief Financial Office and Director

Our Director will serve in such capacity until our next annual meeting of shareholders and until her successors have been elected and qualified. The officer serve at the discretion of our Director. There are no arrangements or other understandings between any of our directors or officers or any other person pursuant to which any officer or director was or is to be selected as an officer or director. None of our Directors are independent but are a part of, and are controlled by our management.

Ms. Underwood has been our President, Chief Executive and Financial Officer, Treasurer and a Director since our inception. She has been involved in this business since 1996, through our unincorporated predecessor. This has been her principal occupation during this period. She has been the Corporate Secretary since March, 2009, after the resignation of Mr. Bradley C. Underwood.

Committees of the Board of Directors

There are no committees of the Board of Directors.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 (the “34 Act”) requires our officers and directors and persons owning more than ten percent of the Common Stock, to file initial reports of ownership and changes in ownership with the Securities and Exchange Commission (“SEC”). Additionally, Item 405 of Regulation S-K under the 34 Act requires us to identify in its Form 10-K and proxy statement those individuals for whom one of the above referenced reports was not filed on a timely basis during the most recent year or prior years. We have nothing to report in this regard.

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Code of Ethics

Our Board of directors has not adopted a code of ethics but plans to do so in the future.

Options/SAR Grants and Fiscal Year End Option Exercises and Values

We have not had a stock option plan or other similar incentive compensation plan for officers, directors and employees, and no stock options, restricted stock or SAR grants were granted or were outstanding at any time.

Item 11. EXECUTIVE COMPENSATION

None of our officers or director received or was entitled to receive remuneration in excess of $100,000 for the fiscal years ended December 31, 2009, 2007 or 2006. Our officers and directors do not receive any compensation for their services rendered to us, nor have they received such compensation in the past. As of the date of this registration statement, we have no funds available to pay the officers and directors. Further, the officers and directors are not accruing any compensation pursuant to any agreement with us. We have no plans to pay any compensation to our officers or directors in the future.

None of our officers and directors will receive any finder’s fee, either directly or indirectly, as a result of their respective efforts to implement our business plan outlined herein.

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

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The following sets forth the number of shares of our $.0.001 par value common stock beneficially owned by (i) each person who, as of March 25, 2009, was known by us to own beneficially more than five percent (5%) of its common stock; (ii) our individual Directors and (iii) our Officers and Directors as a group. A total of 9,197,802 shares of common stock were issued and outstanding as of March 1, 2010.

Name and Address	Amount and Nature of	Percent of
of Beneficial Owner	Beneficial Ownership (1)(2)	Class

Deanie J. Underwood(3)	4,400,702	48%
2519 East Kentucky Ave.
Denver, Colorado 80209

Bradley C. Underwood(3)	4,400,702	48%
2519 East Kentucky Ave.
Denver, Colorado 80209

All Officers and Directors as a Group (one person)	4,400,702	48%

________________

(1) All ownership is beneficial and of record, unless indicated otherwise.

(2) Beneficial owners listed above have sole voting and investment power with respect to the shares shown. Deanie J. Underwood is the step-mother of Bradley C. Underwood. However, each person disclaims ownership of the other’s shares.

(3) Includes 702 shares owned in the name of the Underwood Family Partners, LLC. for which Deanie and Bradley Underwood are beneficiaries.

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

Formerly we occupied office space on a rent-free basis from one of our former officers, Mr. Bradley Underwood, which is also Mr. Underwood’s home.

In 2008, our subsidiary, Stone Select, LLC, had a 1,200 square foot showroom and a 3,000 square foot warehouse. We rented the showroom from an unaffiliated third party for $1,500 per month on a month-to-month lease. We rented the warehouse from an unaffiliated third party for $2,700 per month on a two year lease which expired April, 2009.

Currently, we rent office space at $1,500 per month under a verbal lease, and yard and warehouse space at approximately $2,100 per month plus costs under a non-cancellable lease with an unaffiliated third party and no stated renewal option expiring in March 2012.

We also recorded compensation expense of $500 per month in 2008 for administrative and management services donated to us by officers, and $250 per month for office space donated by an officer. Total donated services expense for 2008 was $9,000.

Unaffiliated third parties, Craig and Susie Bush, collectively own 49% of Stone Select, LLC. We have ownership and voting control of 51% of Stone Select, LLC.

ITEM 14: PRINCIPAL ACCOUNTANT FEES AND SERVICES

Our independent auditor, Ronald R. Chadwick, P.C., Certified Public Accountants, billed an aggregate of $11,000 for the year ended December 31, 2009 and for professional services rendered for the audit of the Company's annual financial statements and review of the financial statements included in its quarterly reports. The firm billed an aggregate of $10,150 for the year ended December 31, 2008 and for professional services rendered for the audit of the Company's annual financial statements and review of the financial statements included in its quarterly reports.

We do not have an audit committee and as a result our entire board of directors performs the duties of an audit committee. Our board of directors evaluates the scope and cost of the engagement of an auditor before the auditor renders audit and non-audit services.

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ITEM 15. EXHIBITS FINANCIAL STATEMENT SCHEDULES.

The following financial information is filed as part of this report:

(a) (1) FINANCIAL STATEMENTS

(2) SCHEDULES

(3) EXHIBITS. The following exhibits required by Item 601 to be filed herewith are incorporated by reference to previously filed documents:

Exhibit Number	Description

3.1.	Articles of Incorporation of By Design, Inc.*
3.2	Bylaws of By Design, Inc.*
4.1	Stock Specimen *
21.2	List of Subsidiaries*
31.1	Certification of CEO/CFO pursuant to Sec. 302
32.1	Certification of CEO/CFO pursuant to Sec. 906

* Previously filed

(b) Reports on Form 8-K. We filed no reports under cover of Form 8-K for the fourth fiscal quarter of 2009.

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SIGNATURES

In accordance with Section 12 of the Securities Exchange Act of 1934, the Registrant has duly caused this Amendment No. 1 to Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized on January 21, 2011.

	BY DESIGN, INC.

	By:	/s/ Gary S. Ohlbaum
		Gary S. Ohlbaum
		President, Chief Executive Officer and Chief Financial Officer (principal executive officer and principal financial and accounting officer)

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Attached files

Global Gate Property Corp. Reports

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