UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10 - Q

(Mark One)

/X/    QUARTERLY  REPORT  PURSUANT  TO  SECTION  13 OR 15(D)  OF THE  SECURITIES
       EXCHANGE ACT OF 1934
       For the quarterly period ended September 30, 2005

/ /    TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR 15(D) OF THE  SECURITIES
       EXCHANGE ACT OF 1934
       For the transition period from ___________ to _________

            Commission File Number:   0-25918
                                      -------

                             EVERLAST WORLDWIDE INC.
                             -----------------------
             (Exact name of Registrant as specified in its charter)

          DELAWARE                                           13-3672716
(State or other jurisdiction of                           (IRS Employer
incorporation or organization)                            Identification No.)

                            1350 BROADWAY, SUITE 2300
                               NEW YORK, NY 10018
                    (Address of Principal Executive Offices)

                                 (212) 239-0990
              (Registrant's telephone number, including area code)
                                 Not Applicable
                     (Former name, former address and former
                    fiscal year if changed since last report)

            Indicate by check 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 past 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

                 Yes  /X/                No / /

            Indicate by check whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange act)

                 Yes  / /                No /X/

            Indicate by check  whether  the  Registrant  is a shell  company (as
defined in Rule 12b-2 of the Exchange act)

                 Yes  / /                No /X/

            The number of common  equity  shares  outstanding  as of November 7,
2005 was 3,303,869  shares of Common Stock,  $.002 par value, and 100,000 shares
of Class A Common Stock, $.01 par value.







                                      INDEX



PART I.  FINANCIAL INFORMATION                                             PAGE
                                                                           ----

  Item 1.  Consolidated Financial Statements

           Consolidated Balance Sheets -
             September 30, 2005 (Unaudited) and December 31, 2004          3

           Consolidated Statements of Operations -
             Three and Nine Months ended September 30, 2005 and 2004
             (Unaudited)                                                   4

           Consolidated Statements of Cash Flows -
             Nine Months ended September 30, 2005 and 2004 (Unaudited)     5

           Notes to Consolidated Financial Statements -
             Nine Months ended September 30, 2005 - (Unaudited)            6-11

  Item 2.  Management's Discussion and Analysis of Financial Condition
             and Results of Operations                                     12-17

  Item 3.  Quantitative and Qualitative Disclosure About Market Risk       17

  Item 4.  Controls and Procedures                                         17

PART II.   OTHER INFORMATION

   Items 1 through 5 not applicable

   Item 6. Exhibits                                                        17

SIGNATURES                                                                 18

                                       2





                                              EVERLAST WORLDWIDE INC.
                                            CONSOLIDATED BALANCE SHEETS

                                                                                    SEPTEMBER 30,     DECEMBER 31,
                                                                                        2005            2004
                                                                                    -------------    ------------
                                                                                    (Unaudited)       (Note)
     ASSETS
     Current assets:
     Cash and cash equivalents                                                      $    111,000    $    649,000
     Accounts receivable - net                                                         8,748,000       9,781,000
     Inventories                                                                      13,143,000      11,762,000
     Inventories of discontinued component                                                  --         1,020,000
     Prepaid expenses and other current assets                                         2,508,000         921,000
                                                                                    ------------    ------------
                   Total current assets                                               24,510,000      24,133,000

     Restricted cash                                                                   1,050,000       1,028,000
     Property and equipment, net                                                       6,107,000       6,182,000
     Goodwill                                                                          6,718,000       6,718,000
     Trademarks, net                                                                  22,892,000      23,576,000
     Other assets                                                                      2,972,000       3,119,000
                                                                                    ------------    ------------
                                                                                    $ 64,249,000    $ 64,756,000
                                                                                    ============    ============

   LIABILITIES, REDEEMABLE PARTICIPATING PREFERRED STOCK AND STOCKHOLDERS' EQUITY

   Current liabilities:
     Current maturities of Series A redeemable participating preferred stock        $  3,000,000    $  3,000,000
     Due to factor                                                                    11,452,000      11,316,000
     Current maturities of long term debt                                                235,000         249,000
     Accounts payable                                                                  4,109,000       6,530,000
     Accrued expenses and other current liabilities                                    2,490,000       1,062,000
     Deferred licensing revenues                                                         756,000            --
                                                                                    ------------    ------------
                   Total current liabilities                                          22,042,000      22,157,000

   License deposits payable                                                              453,000         440,000
   Series A Redeemable participating preferred stock                                  22,000,000      22,000,000
   Notes payable                                                                       4,000,000       4,000,000
   Other liabilities                                                                        --           190,000
   Long term debt, net of current maturities                                           2,509,000       2,643,000
                                                                                    ------------    ------------
                   Total liabilities                                                  51,004,000      51,430,000
                                                                                    ------------    ------------

   Stockholders' equity:
     Common stock,  par value $.002;  19,000,000 shares
        authorized;  3,468,236 issued (3,244,359 in 2004), 3,294,236
        outstanding, (3,070,359 in 2004)                                                   8,000           7,000
     Class A common stock, par value $.01; 100,000 shares
        authorized; 100,000 shares issued and outstanding                                  1,000           1,000
     Paid-in capital                                                                  12,254,000      11,821,000
     Retained earnings                                                                 1,709,000       2,224,000
                                                                                    ------------    ------------
                                                                                      13,972,000      14,053,000
     Less treasury stock, at cost (174,000 common shares)                               (727,000)       (727,000)
                                                                                    ------------    ------------
                                                                                      13,245,000      13,326,000
                                                                                    ------------    ------------
                                                                                    $ 64,249,000    $ 64,756,000
                                                                                    ============    ============

See accompanying notes to the financial statements

Note: The balance sheet at December 31, 2004 has been derived from the audited financial statements at that date.

                                       3





                                              EVERLAST WORLDWIDE INC.
                                       CONSOLIDATED STATEMENTS OF OPERATIONS


                                                                      Three months ended                Nine months ended
                                                                          September 30,                   September 30,
                                                                -------------------------------------------------------------
                                                                    2005              2004          2005            2004
                                                                -------------------------------------------------------------
                                                                           (Unaudited)                  (Unaudited)


Net sales                                                       $  9,780,000    $  8,627,000    $ 28,440,000    $ 23,256,000
Net license revenues                                               2,807,000       2,475,000       8,845,000       6,952,000
                                                                ------------    ------------    ------------    ------------
Net revenues                                                      12,587,000      11,102,000      37,285,000      30,208,000
                                                                ------------    ------------    ------------    ------------

Cost of goods sold                                                 7,841,000       6,958,000      23,616,000      17,155,000
                                                                ------------    ------------    ------------    ------------
Gross profit                                                       4,746,000       4,144,000      13,669,000      13,053,000

Operating expenses:
  Selling and shipping                                             1,877,000       2,528,000       6,095,000       6,664,000
  General and administrative                                       1,444,000       1,737,000       4,711,000       5,031,000
  Restructuring and non-recurring charges                               --              --           273,000            --
  Costs in connection with warrant issuance                             --              --           182,000            --
  Amortization                                                       228,000         228,000         684,000         684,000
                                                                ------------    ------------    ------------    ------------
                                                                   3,549,000       4,493,000      11,945,000      12,379,000
                                                                ------------    ------------    ------------    ------------

Income (loss) from continuing operations                           1,197,000        (349,000)      1,724,000         674,000
                                                                ------------    ------------    ------------    ------------

Other income (expense):
  Interest expense and financing costs                              (555,000)       (336,000)     (1,632,000)       (960,000)
  Interest (income) expense on redeemable participating
    preferred stock                                                     --           200,000            --           (14,000)
  Investment income                                                    6,000           4,000          17,000          13,000
                                                                ------------    ------------    ------------    ------------
                                                                    (549,000)       (132,000)     (1,615,000)       (961,000)
                                                                ------------    ------------    ------------    ------------

Income (loss) before provision (benefit) for income taxes
  from continuing operations                                         648,000        (481,000)        109,000        (287,000)

Provision (benefit) for income taxes                                 257,000        (347,000)         90,000        (110,000)
                                                                ------------    ------------    ------------    ------------

Net income (loss) from continuing operations                         391,000        (134,000)         19,000        (177,000)
                                                                ============    ============    ============    ============

Income (loss) from discontinued component, net of tax               (216,000)       (115,000)       (534,000)        195,000
                                                                ------------    ------------    ------------    ------------
Net income (loss) available to common shareholders              $    175,000    ($   249,000)   ($   515,000)   $     18,000
                                                                ============    ============    ============    ============

Basic earnings (loss) per share from continuing operations      $       0.12    ($      0.04)   $       0.01    ($      0.06)
                                                                ============    ============    ============    ============

Diluted earnings (loss) per share from continuing operations    $       0.09    ($      0.04)   $       0.00    ($      0.06)
                                                                ============    ============    ============    ============

Basic (loss) earnings per share from discontinued component     ($      0.06)   ($      0.04)   ($      0.16)   $       0.06
                                                                ============    ============    ============    ============
Diluted (loss) earnings per share from discontinued component   ($      0.05)   ($      0.04)   ($      0.14)   $       0.06
                                                                ============    ============    ============    ============
Net basic earnings (loss) per share                             $       0.05    ($      0.08)   ($      0.15)   $       0.01
                                                                ============    ============    ============    ============
Net diluted earnings (loss) per share                           $       0.04    ($      0.08)   ($      0.14)   $       0.01
                                                                ============    ============    ============    ============

See accompanying notes to financial statements.

                                                        4





                                                                            EVERLAST WORLDWIDE INC.
                                                                     CONSOLIDATED STATEMENTS OF CASH FLOWS



                                                                                 NINE MONTHS ENDED
                                                                                    SEPTEMBER 30,
                                                                             ---------------------------
                                                                                  2005         2004
                                                                             ---------------------------

                                                                                      (Unaudited)

Cash flows from operating activities:
  Net income (loss)                                                          ($  515,000)   $    18,000
  Adjustments to reconcile net income (loss) to net
    cash provided by operating activities:
       Depreciation and amortization                                             378,000        375,000
       Amortization                                                            1,101,000      1,042,000
       Non-cash cost in connection with warrant issuance                         182,000           --
       Interest income on restricted cash                                        (22,000)        (8,000)
Changes in assets (increase) decrease:
       Accounts receivable                                                     6,575,000      2,285,000
       Inventories                                                              (361,000)    (4,235,000)
       Prepaid expenses and other current assets                              (1,586,000)      (634,000)
       Other assets                                                             (270,000)       110,000
Changes in liabilities increase (decrease):
       Accounts payable, accrued expenses
         and other current liabilities                                        (1,183,000)     2,051,000
       Deferred licensing revenues                                               756,000           --
       License deposits payable                                                   13,000        (36,000)
                                                                             -----------    -----------
             Net cash provided by operating activities                         5,068,000        968,000
                                                                             -----------    -----------

Cash flows used by investing activities:
       Purchases of property and equipment                                      (303,000)      (483,000)
                                                                             -----------    -----------

Cash flows from financing activities:
       Repayments to factor                                                   (5,407,000)    (1,552,000)
       Proceeds from exercises of stock options                                  252,000          2,000
       Payment of financing costs                                                   --         (100,000)
       Repayments of debt instruments                                           (148,000)      (239,000)
                                                                             -----------    -----------
             Net cash used by financing activities:                           (5,303,000)    (1,889,000)
                                                                             -----------    -----------

Net decrease in cash and cash equivalents                                       (538,000)    (1,404,000)
Cash and cash equivalents, beginning of period                                   649,000      1,937,000
                                                                             -----------    -----------

Cash and cash equivalents, end of period                                     $   111,000    $   533,000
                                                                             ===========    ===========

Supplemental disclosures of cash flow information:
  Cash paid during the period for:
    Interest                                                                 $   899,000    $   699,000
    Income taxes                                                                  10,000          4,000


See accompanying notes to financial statements.

                                                        5





                             EVERLAST WORLDWIDE INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.    THE COMPANY AND BASIS OF PRESENTATION:

      Everlast Worldwide, Inc. (herein referred to as "the Company", "we", "us",
      and "our") is a manufacturer,  marketer and licensor of sporting goods and
      apparel  under  the  Everlast  brand  name.  The  consolidated   financial
      statements  of the Company are  presented  herein as of September 30, 2005
      and for the three and nine months  ended  September  30, 2005 and 2004 are
      unaudited  and, in the  opinion of  management,  include  all  adjustments
      (consisting only of normal and recurring adjustments) necessary for a fair
      presentation  of  financial  position  and  results  of  operations.  Such
      financial  statements do not include all of the  information  and footnote
      disclosures  normally included in audited financial statements prepared in
      accordance with generally accepted accounting principles. The accompanying
      unaudited   consolidated   financial  statements  have  been  prepared  in
      accordance  with the  instructions to Form 10-Q. The results of operations
      for the three and nine month  periods  ended  September  30,  2005 are not
      necessarily  indicative  of the results that may be expected for any other
      interim periods or the full year ending December 31, 2005. The Company has
      reviewed the status of its legal contingencies and has disclosed an update
      below from that  disclosed  on Form 10-K for the year ended  December  31,
      2004.


2.    EARNINGS PER SHARE:

      We report  basic and diluted  earnings per share in  accordance  with SFAS
      Statement No. 128 "Earnings  Per Share" ("SFAS No. 128").  Basic  earnings
      per share  amounts are computed  based on the weighted  average  number of
      shares actually outstanding during the period.  Diluted earnings per share
      amounts  are  based  on an  increased  number  of  shares  that  would  be
      outstanding assuming the exercise of dilutive stock options,  warrants and
      contingent  consideration  pursuant to the Merger  Agreement dated October
      24, 2000. On October 24, 2005,  the Company  issued  approximately  70,000
      common shares to certain preferred  stockholders as part of the make-whole
      contingent  consideration  as  stipulated  in the Merger  Agreement  dated
      October 24, 2000.

      The  following  table  sets  forth the  computation  of basic and  diluted
      earnings per share pursuant to SFAS No. 128:







                                                                        Three Months Ended          Nine Months Ended
                                                                            September 30,             September 30,
                                                                ----------------------------------------------------------
                                                                       2005          2004          2005             2004
                                                                ----------------------------------------------------------
Numerator:
Numerator for basic and diluted
            earnings per common share --

    Net income (loss)  available to common
     stockholders                                               $   175,000    ($  249,000)   ($  515,000)      $   18,000
                                                                -----------    -----------    -----------    -------------

Denominator:
Denominator for basic earnings per
   common share --
     Weighted average shares
     outstanding during the period                                3,385,858      3,129,904      3,282,294        3,129,322
                                                                -----------    -----------    -----------    -------------
Effect of diluted securities:
Stock options and warrants                                          147,167           --          228,440             --

Contingent stock consideration related to the
 Merger                                                             581,538           --          337,548             --
                                                                -----------    -----------    -----------    -------------
                                                                    728,705           --          565,988             --

Denominator for diluted earnings per
   common share --
     adjusted weighted average shares and assumed
     conversions                                                  4,114,563      3,129,322      3,848,282        3,129,904
                                                                -----------    -----------    -----------    -------------

     Basic net income (loss) per common share                   $      0.05    ($     0.08)   ($     0.15)   $        0.01
                                                                ===========    ===========    ===========    =============
     Diluted net income (loss) per common share                 $      0.04    ($     0.08)   ($     0.14)   $        0.01
                                                                ===========    ===========    ===========    =============

         As a result of the loss from continuing  operations in the three months
         ended and year to date results of fiscal 2004,  the dilutive  effect of
         options, warrants and contingent consideration (aggregating 566,000 and
         1,321,000 equivalent shares, respectively) are not shown as the results
         would be anti-dilutive.

         Due to the  discontinued  component  requirements  of SFAS No. 128, the
         diluted loss per share for the three and nine months ended September 30
         2005, does not have an anti-dilutive impact on the computation.


3.       DISPOSAL OF A COMPONENT:

         On December 17, 2004, we announced  the signing of the largest  license
         agreement in our history  whereby we licensed our United States women's
         apparel category to Jacques Moret, Inc.,  effective January 1, 2005. We
         believe that it was in our best interest to license our women's apparel
         business  as a result  of the  licensees'  ability  to  source  product
         cheaper, due to its buying power, along with its expanded  distribution
         available from its presence in certain channels of distribution.

         The  following  results  of our  women's  apparel  component  have been
         presented as income from a discontinued  component in the  accompanying
         consolidated  statements  of  operations  for the three and nine months
         ended September 30, 2004:

                                      -7-





                                           Three Months     Nine Months
                                                Ended          Ended
                                            September 30,   September 30,
                                                 2004           2004
                                           --------------  --------------
Net sales                                    $ 4,703,000    $16,264,000
Costs and expenses                             4,901,000     15,926,000
                                           -------------    -----------

Income (loss) before income taxes               (198,000)       338,000
Provision (benefit) for income taxes             (83,000)       143,000
                                           -------------    -----------

Income(loss)from discontinued component     ($  115,000)   $   195,000
                                           =============    ===========

         During the three and nine months ended  September 30, 2005, the Company
         incurred inventory write-downs,  duplicative  warehousing and logistics
         costs and other costs aggregating $216,000 and $534,000,  respectively,
         net of tax, associated with this discontinued component.

4.       RESTRUCTURING AND NON-RECURRING CHARGES:

         Commencing  July 2003, we decided to pursue and execute a plan to close
         the Bronx,  New York facility.  Our decision to close this facility was
         largely the result of significant  lease  escalation  costs expected at
         the end of the term of the then  existing  lease in April  2004 and our
         inability to reach practical  capacity at both the Bronx,  New York and
         Moberly, Missouri facilities. Accordingly, during the fourth quarter of
         fiscal 2003,  we completed  the  relocation  and  consolidation  of the
         facilities.  In the fourth  quarter of fiscal 2004, we were notified by
         the former union representing employees of the Bronx, New York facility
         that a potential minimum  withdrawal pension liability existed on these
         former   employees   that  were   covered   under  a  defined   benefit
         multi-employer  pension plan. In the second  quarter of fiscal 2005 the
         Company and the union  agreed on a  settlement  for  $273,000  for this
         minimum withdrawal  liability resulting in a charge for the nine months
         ended September 30, 2005.  Through  September 30, 2005, the Company has
         paid $69,000  towards this  settlement and is required to pay quarterly
         installments of $12,000 commencing July 1, 2005 through July 2009.

5.       CONTINGENCIES:

         On December 20, 2000,  a lawsuit was brought  against the Company,  its
         subsidiary (EWBH),  and two officers of the Company.  The complaint was
         initiated by EWBH's licensing  representative  (the "plaintiff") in the
         Supreme  Court of the State of New York (the  "Court").  The  plaintiff
         alleged  breach of contract,  tortuous  interference  with  contractual
         relations,  tortuous  interference with prospective  business relations
         and unjust enrichment stemming from the merger of the Company completed
         on October 24, 2000.

         On November 30, 2001, the claims against the officers were dismissed by
         the Supreme  Court.  On September  27, 2002,  the  Appellate  Divisions
         unanimously affirmed the order dismissing those claims.

         On December  23, 2002,  the balance of the lawsuit  against the Company
         was  dismissed  by summary  judgment.  Plaintiff  subsequently  filed a

                                      -8-





         motion seeking  permission to further appeal its claims to the Court of
         Appeals  as well as  reasserting  its  breach of  contract  claims in a
         separate demand for arbitration. The Plaintiff's appeal of that portion
         of the  decision  dismissing  its claim for a breach  of  contract  was
         unanimously  affirmed by the  Appellate  Division on December 16, 2003.
         Hearings in the arbitration commenced November 2004. In April 2005, the
         Company was notified that the  arbitrator's  award held that Everlast's
         termination  of  Plantiff's   representation  agreement  was  void  and
         declared  not to be  terminated.  The  arbitrator's  award  may  not be
         enforced  until it is confirmed by the Supreme  Court upon  application
         made within one year. As of November 3, 2005, the Supreme Court had not
         confirmed  the award.  The  Company  has filed a motion in the  Supreme
         Court, New York County seeking an order to vacate the award. Management
         and corporate  counsel  believe that the award should be vacated on the
         grounds of  arbitrator  misconduct  and that the  arbitrators  exceeded
         their  authority in rendering their award. A hearing on that motion was
         held on September 15, 2005. If the Company's motion to vacate the award
         is not  granted,  it  would be  required  to pay  Hansen  approximately
         $575,000 in back commissions. The Company believes it has a good chance
         in  prevailing  on its motion and thus has not recorded a liability for
         this possible contingency.


6.       REDEEMABLE PARTICIPATING PREFERRED STOCK AND NOTES PAYABLE:

        The  percentage of net income,  as defined in the Company's  October 24,
        2000 Merger Agreement,  to be paid to holders of the Preferred Stock for
        the annual dividend on after tax profits is as follows:

              Twelve months ending December 31, 2005           37.0%
                                                2006           29.6%
                                                2007           22.2%
                                                2008           14.8%
                                                2009            7.4%

        On January 13, 2004 we  announced  that we had entered into an Agreement
        on December 14, 2003 with the Principal Preferred Stockholder, modifying
        its annual minimum  redemptions.  Under the terms of the  Agreement,  in
        lieu of a cash payment for the redemption of a portion of their Series A
        Preferred  Stock,  $2,000,000  for  each of the  four  years  commencing
        December 14, 2003,  through  December 14, 2006,  will be converted  into
        four term loans ("Notes"), which $4,000,000 have been so-converted as of
        September  30, 2005.  The Notes are evidenced by four  promissory  notes
        from the  Company  which shall  provide for the payment of interest  and
        deferred  finance costs.  Interest and deferred  finance costs are to be
        paid at the combined  annual rate of 9.5% per annum on the  aggregate $8
        million of notes  during each of the years 2004  through  2007,  and 10%
        during 2008 payable each  December  14th until  maturity on December 14,
        2008. The Company shall have the right to pre-pay the  promissory  notes
        in full,  with no prepayment  fees,  prior to December 14, 2008 together
        with all unpaid interest and deferred financing costs due at the time of
        pre-payment.  There are no changes to the  existing  preferred  dividend
        formula currently being used on the outstanding redeemable percentage of
        the Series A Preferred Stock, mentioned above.

        The  minimum  redemption  amounts,  as  amended  for the  aforementioned
        refinance, including the repayment of the notes payable requirements are
        as follows:

                                      -9-





                                   December 2005           3,000,000
                                            2006           3,000,000
                                            2007           5,000,000
                                            2008          13,000,000
                                            2009           5,000,000

7.       INVENTORIES:

         Inventories are stated at the lower of cost  (determined on a first-in,
         first-out basis) or market.

                                      SEPTEMBER 30, 2005       DECEMBER 31, 2004
                                      ------------------       -----------------

               Raw materials             $ 1,659,000            $  2,657,000
               Work-in-process               788,000                 688,000
               Finished goods             10,696,000               8,417,000
                                         -----------            ------------
                                         $13,143,000            $ 11,762,000
                                         ===========            ============

8.       ACCOUNTING FOR STOCK BASED COMPENSATION:

         The Company accounts for its stock-based  compensation  plans using the
         intrinsic value method under APB Opinion No. 25,  "Accounting for Stock
         Issued to Employees" ("APB 25") and related Interpretations.  Under APB
         25, when the exercise  price of our employee stock options are at least
         equal to the market price of the underlying stock on the date of grant,
         no compensation expense is recognized.

         As of December 2002, the Company adopted SFAS No. 148,  "Accounting for
         Stock-Based  Compensation-Transition  and  Disclosure,  an Amendment of
         FASB No.  123." SFAS No. 148 revises the methods  permitted by SFAS No.
         123  of  measuring   compensation   expense  for  stock-based  employee
         compensation  plans.  The  Company  uses  the  intrinsic  value  method
         prescribed in Accounting  Principles Board Opinion No. 25, as permitted
         under  SFAS No.  123.  Therefore,  this  change did not have a material
         effect on the financial  statements.  SFAS No. 148 requires the Company
         to disclose pro forma information related to stock-based  compensation,
         in  accordance  with SFAS No. 123, on a quarterly  basis in addition to
         the annual disclosure.

         If compensation cost for the Company's  stock-based  compensation plans
         had  been  determined  based  on the  fair  value  at the date of grant
         consistent  with  the  method  prescribed  by  Statement  of  Financial
         Accounting Standard No. 123, "Accounting For Stock-Based Compensation",
         net  earnings  and  earnings  per share  for the  three and nine  month
         periods ended September 30, 2005 and 2004 would have been the pro forma
         amounts that follow:

                                      -10-






                                              Three Months Ended        Nine Months Ended
                                                 September 30,             September 30
                                       --------------------------------------------------------
                                            2005         2004          2005           2004
                                       --------------------------------------------------------

Net income (loss), as reported         $   175,000    ($  249,000)   ($515,000)      $  18,000

Stock-based employee compensation
expense determined under fair value
method, net of related tax effects         (28,000)       (19,000)     (83,000)        (36,000)
                                       -----------     ----------    ---------      -----------

Pro-forma net income (loss)            $   147,000    ($  268,000)   ($598,000)     ($  18,000)
                                       ===========     ==========    =========      ===========

Basic net income per common share:
     As reported                       $      0.05    ($     0.08)   ($    .15)      $    0.01
                                       ===========     ==========    =========      ===========
     Pro-forma                         $      0.04    ($     0.09)   ($   0.18)     ($    0.01)
                                       ===========     ==========    =========      ===========

Diluted net income per common share:
     As reported                       $      0.04    ($     0.08)   ($   0.14)      $    0.01
                                       ===========     ==========    =========      ===========
     Pro-forma                         $      0.04    ($     0.08)   ($   0.16)     ($    0.01)
                                       ===========     ==========    =========      ===========

            On  December  16,  2004,  the FASB  issued  FASB  Statement  No. 123
            (revised  2004),  Share-Based  Payment,  which is a revision of FASB
            Statement  No.  123,   Accounting  for   Stock-Based   Compensation.
            Statement 123(R) supersedes APB Opinion No. 25, Accounting for Stock
            Issued to Employees,  and amends FASB Statement No. 95, Statement of
            Cash Flows.  Generally,  the approach in Statement 123(R) is similar
            to the  approach  described  in Statement  123.  However,  Statement
            123(R)  requires all  share-based  payments to employees,  including
            grants of employee  stock  options,  to be  recognized in the income
            statement  based on their fair values.  Pro forma  disclosure  is no
            longer an alternative. In April 2005, the SEC amended the compliance
            dates for Statement 123(R) from fiscal periods  beginning after June
            15, 2005 to fiscal years beginning after June 15, 2005. We expect to
            adopt  Statement  123 (R) in our fiscal year  commencing  January 1,
            2006.

9.       RECENT ACCOUNTING PRONOUNCEMENTS:

         In November 2004, the FASB issued SFAS No. 151,  "Inventory  Costs,  an
         amendment  of ARB No.43,  Chapter 4." SFAS amends  Accounting  Research
         Bulletin ("ARB") No.43,  Chapter 4, to clarify that abnormal amounts of
         idle facility  expense,  freight,  handling costs and wasted  materials
         (spoilage) should be recognized as current-period charges. In addition,
         SFAS No.151  requires that allocation of fixed  production  overhead to
         inventory be based on the normal capacity of the production facilities.
         SFAS No.151 is effective for inventory costs incurred during the fiscal
         years  beginning  after  September  15, 2005.  The Company is currently
         assessing   the  impact  SFAS  No.151  will  have  on  the  results  of
         operations, financial position or cash flows.

                                      -11-





ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

        Certain  statements   contained  in  this  quarterly  report  constitute
"forward-looking statements" within the meaning of Section 27A of the Securities
Act and  Sections  21E of the  Exchange  Act.  Such  forward-looking  statements
involve known and unknown risks,  uncertainties and other factors that may cause
our actual results, levels of activity, performance or achievements, or industry
results, to be materially different from any future results, levels of activity,
performance  or  achievements  expressed  or  implied  by  such  forward-looking
statements. Such factors include, among others, the following:  general economic
and business  conditions,  our ability to implement our business  strategy;  our
ability  to  obtain  financing  for  general  corporate  purposes;  competition;
availability  of key  personnel,  and changes in, or the failure to comply with,
government's  regulations.  As a result of the foregoing and other  factors,  no
assurance  can be  given  as to the  future  results,  levels  of  activity  and
achievements  and  neither  us nor any  person  assumes  responsibility  for the
accuracy and completeness of these statements.

GENERAL

            Everlast Worldwide Inc. is a Delaware corporation  organized on July
6, 1992. We are engaged in the design, manufacture,  marketing and sale of men's
activewear, sportswear and outerwear (the "Apparel Products") each featuring the
widely-recognized  Everlast(R)  trademark.  We also  manufacture  sporting goods
related to the sport of boxing such as boxing  gloves,  heavy bags,  speed bags,
boxing trunks,  and  miscellaneous  gym equipment that are sold through sporting
goods stores, mass merchandisers,  catalog operations,  gymnasiums,  and martial
arts  studios.  In addition,  we license the  Everlast(R)  trademark to numerous
companies  that  source and  manufacture  products  such as men's,  women's  and
children's  apparel,   footwear,   cardiovascular   equipment,  back  to  school
stationery,  eyewear,  sports bags,  hats,  fragrances,  batteries,  nutritional
products and other accessories.

        Our  financial   statements  and  the  notes  thereto  contain  detailed
information that should be referred to in conjunction with this discussion.

CRITICAL ACCOUNTING POLICIES, ESTIMATES AND JUDGEMENTS

        Our  financial  statements  are prepared in accordance  with  accounting
principles generally accepted in the United States. The accounting principles we
use  require us to make  estimates  and  assumptions  that  affect the  reported
amounts of assets and  liabilities  at the date of the financial  statements and
amounts of income  and  expenses  during the  reporting  periods  presented.  We
believe in the quality and reasonableness of our critical  accounting  policies,
however it is likely that materially  different  amounts would be reported under
different  conditions or using different  assumptions that we have  consistently
applied. We believe our critical  accounting policies are as follows,  including
our methodology for estimates made and assumptions used.

                REVENUE  RECOGNITION  POLICY.  Revenues from royalty and finders
                agreements  are recognized  when earned by applying  contractual
                royalty  rates to  quarterly  point of sale  data,  among  other
                criteria,  received from our licensees.  Our royalty recognition
                policy  provides  for  recognition  of  royalties in the quarter
                earned,  although a large  portion of such royalty  payments are
                actually  received  during  the  month  following  the  end of a
                quarter.  Revenues are not recognized  unless  collectibility is
                reasonably   assured.   Product  revenues  are  recognized  upon
                shipment of inventory to customers.

                 TRADE  RECEIVABLES.  We perform  ongoing credit  evaluations on
                 existing  and  new  customers  daily.  We  apply  reserves  for
                 delinquent  or  uncollectible  trade  receivables  based  on  a
                 specific  identification  methodology  and also apply a general
                 reserve based on our trade receivables aging categories. Credit
                 losses have been within our estimates over the last few years.

                 INVENTORIES. Our inventories are valued at the lower of cost or
                 market.  Cost has been derived principally on the standard cost
                 methodology,  where we utilize a first-in-first-out  method. We

                                      -12-





                 provide  for   reserve   allowances   on  finished   goods  and
                 specifically  identify  and reserve for slow moving or obsolete
                 raw materials and packaging.

                 DEFERRED  TAXES.  Deferred  taxes are  determined  based on the
                 differences  between the  financial  statement and tax bases of
                 assets and  liabilities,  using enacted tax rates in effect for
                 the year in which the  differences  are  expected  to  reverse.
                 Valuation  allowances are established  when necessary to reduce
                 deferred tax assets to the amounts expected to be realized.  In
                 assessing  the  need  for  a  valuation  allowance   management
                 considers  estimates  of  future  taxable  income  and  ongoing
                 prudent and  feasible tax planning  strategies.  In  accordance
                 with APB Opinion  23,  "Accounting  for Income  Taxes - Special
                 Areas,"  we do not  accrue  income  taxes on the  undistributed
                 earnings of a subsidiary  which is a "DISC" since the repayment
                 of the earnings of the DISC is not expected in the  foreseeable
                 future.  If  circumstances  change and it becomes apparent that
                 some or all of the  undistributed  earnings of the DISC will be
                 remitted in the foreseeable future, then taxes will be accrued.

                 VALUATION OF GOODWILL, LONG-LIVED ASSETS AND INTANGIBLE ASSETS.
                 We  periodically  evaluate  goodwill,   long-lived  assets  and
                 intangible   assets  for   potential   impairment   indicators.
                 Judgements regarding the existence of impairment indicators are
                 based on estimated future cash flows,  market  conditions,  and
                 legal factors. Future events could cause management to conclude
                 that impairment indicators exist and that the net book value of
                 goodwill,  long-lived assets and intangible assets is impaired.
                 Any  resulting  impairment  loss could have a material  adverse
                 impact on our financial condition and results of operations.

                 CONTINGENCIES   AND   LITIGATION.    We   evaluate   contingent
                 liabilities  including  threatened  or  pending  litigation  in
                 accordance with SFAS No. 5, "Accounting for  Contingencies" and
                 record  accruals  when the  outcome of these  matters is deemed
                 probable  and the  liability  could  be  reasonably  estimated.
                 Management  makes  these  assessments  based on the  facts  and
                 circumstances and in some instances based in part on the advice
                 of outside legal counsel.

RESULTS OF OPERATIONS

2004 DISPOSAL OF BUSINESS COMPONENT

            On  December  17,  2004,  we  entered  into  our  largest  licensing
agreement in our history,  whereby we licensed our United States women's apparel
business to Jacques Moret,  Inc.  effective January 1, 2005. We believe that our
decision to license our women's apparel  business was in our best interests as a
result  of  the  licensee's  ability  to  source  product  cheaper,  due  to the
licensee's  buying  power,  along  with  the  licensee's  expanded  distribution
available from its presence in certain channels of distribution. Accordingly, we
have  reported our results of  operations  on a GAAP basis,  which  includes the
application of SFAS No. 144 "Accounting  for the Disposal of Long-Lived  Assets"
which  requires us to report our results of  operations  of our women's  apparel
business  as  a  discontinued  component  for  all  current  and  prior  periods
presented.

THREE MONTHS ENDED SEPTEMBER 30, 2005

            Net revenues  increased to $12.6  million for the three months ended
September 30, 2005 from $11.1  million for the three months ended  September 30,
2004,  an  increase  of $1.5  million,  or 13%.  This  increase  was a result of
increases in sales of apparel and sporting goods  equipment of $1.2 million (13%
increase), and licensing revenues of $0.3 million (13% increase) compared to the
same period last year.  The increase in  licensing  revenues was a result of the
aforementioned  Jacques Moret, Inc. license, which accounted for $0.6 million of
the increase offset by terminated licenses within the third quarter of 2004 that
accounted  for $0.3  million.  The average  revenue for  license  agreements  in
existence for the past two fiscal  periods is  approximately  $120,000 per year.
There were 85 existing licensing  arrangements as of September 30, 2005 compared
to 73 at September 30, 2004.

                                      -13-





        Gross  profit  increased  to $4.7  million  for the three  months  ended
September  30, 2005 from $4.1 million for the three months ended  September  30,
2004.  Gross profit slightly  increased as a percentage of net revenues to 37.7%
from 37.3%.  The increase in gross profit dollars was due to the  aforementioned
increase in net revenues.

        Selling and shipping  expenses  decreased to $1.9 million  (14.9% of net
revenues) for the three months ended September 30, 2005 from  approximately $2.5
million  (22.8% of net revenues) for the three months ended  September 30, 2004.
The  decrease in dollars and as a percentage  of net  revenues  was  primarily a
result of decreased  personnel costs,  marketing and selling  programs,  reduced
freight-out and logistics costs and other fixed selling costs.

        General and  administrative  expenses  decreased to $1.4 million for the
three  months  ended  September  30, 2005 from $1.7 million for the three months
ended  September  30, 2004.  The $0.3  million  decrease was a result of reduced
general operating  expenses,  primarily  personnel and other corporate  overhead
costs.

        Amortization expense remained  approximately $0.2 million for both three
month periods ended September 30, 2005 and 2004.

         Income from  continuing  operations  increased  to $1.2 million for the
three months ended September 30, 2005 from a loss from continuing  operations of
$349,000 for the September 30, 2004 comparable period. The increase in operating
income for the 2005 period was primarily a result of an increase in gross margin
dollars along with a reduction in selling,  general and administrative  expenses
as more fully explained above.

        Interest expense and finance costs, net of interest income, increased to
 $0.5  million  in the  three  month  period  ending  September  30,  2005  from
 approximately $0.1 million during the September 30, 2004 period. $.2 million of
 the  increase was due to higher  borrowing  costs  associated  with our average
 outstanding  factor  balance as compared to the prior  period,  and  borrowings
 associated  with our  outstanding $4 million notes payable and  amortization of
 deferred finance costs associated with our preferred stock refinance  completed
 in January 2004.  During the three months ended  September 30, 2005, we did not
 incur  any  interest  expense  associated  with  our  redeemable  participating
 preferred  stock due to our  cumulative net loss for the year. In the September
 2004 period,  our after tax loss  required us to reverse an interest  charge of
 $200,000  recorded  during the six months ended June 30, 2004,  pursuant to our
 agreement with the holders of our preferred  stock whom we pay a dividend based
 upon an agreed upon percentage of our after tax profits.

        Income  before  income taxes from  continuing  operations  for the three
months ended September 30, 2005 was $648,000  compared to a loss of $481,000 for
the three month period ended  September  30, 2004.  The increase was a result of
higher operating income offset by higher interest costs, as explained above.

        We  recognized  a tax  provision  of $257,000 for the three months ended
September  30, 2005 as compared to a tax benefit of  approximately  $347,000 for
the three months ended September 30, 2004.

         Net income from continuing  operations was $391,000 in 2005 as compared
to a net loss of  $134,000  in 2004.  Loss,  net of tax,  from the  discontinued
component was approximately $115,000 during the three months ended September 30,
2004 as  compared  to a loss  from  our  discontinued  component,  net of tax of
$216,000  in 2005.  Accordingly,  our net  income  for the  three  months  ended
September 30, 2005 from continuing and  discontinued  operations was $175,000 as
compared to a net loss in the three months ended September 30, 2004 of $249,000.

NINE MONTHS ENDED SEPTEMBER 30, 2005

            Net revenues  increased  to $37.3  million for the nine months ended
September  30, 2005 from $30.2  million for the nine months ended  September 30,
2004,  an  increase  of $7.1  million,  or 23%.  This  increase  was a result of
increases in sales of apparel and sporting goods  equipment of $5.2 million (22%
increase), and licensing revenues of $1.9 million (27% increase) compared to the

                                      -14-





same period last year.  The increase in  licensing  revenues was a result of the
aforementioned Jacques Moret, Inc. license, which accounted for $1.87 million of
this increase.  The average revenue for license  agreements in existence for the
past two  fiscal  periods is  approximately  $120,000.  There  were 85  existing
licensing  arrangements as of September 30, 2005 compared to 73 at September 30,
2004.

        Gross profit  increased to $13.7 million for the nine month period ended
September 30, 2005 from $13.1 million for the nine month period ended  September
30, 2004.  Gross profit  decreased as a percentage of net revenues to 36.7% from
43.2%.  The  increase  in gross  profit  dollars  was due to the  aforementioned
increase in net revenues.  The decrease in gross profit  percentage  was due to:
higher  commodity costs  primarily due to fuel surcharges  which are expected to
continue in the near term; an unfavorable  change in sales mix, which may or may
not continue in the foreseeable  future;  and  specifically,  $100,000 of higher
freight costs associated with the United States imposing tariff and import quota
restrictions on products manufactured in China causing us to ship the product by
air before quota restrictions went into affect; $230,000 in higher promotion and
marketing  development  funds to our  customers  for products sold in connection
with "The Contender"  reality television show, which funds were used to markdown
out of season apparel due to programming delays the show experienced.

        Selling and shipping expenses was  approximately  $6.1 million (16.3% of
net  revenues)  for the nine months ended  September 30, 2005 compared with $6.7
million  (22.1% of net revenues)  for the nine months ended  September 30, 2004.
The  decrease in dollars and as a percentage  of net  revenues  was  primarily a
result of decreased  marketing and selling  programs,  reduced  freight-out  and
logistics costs and other fixed selling costs, including personnel. In addition,
during the nine month period ended  September  30, 2005,  we incurred a non-cash
charge in connection with the issuance of warrants to purchase 149,000 shares of
our common stock,  $0.02 par value (the  "Warrants") to Contender  Partners LLC,
aggregating  $182,000.  The issuance of the warrants were valued using the Black
Scholes  option  pricing  model,  and were in exchange for product  placement of
men's apparel and sporting goods appearing on The Contender.

        General and  administrative  expenses  decreased to $4.7 million for the
nine month period ended September 30, 2005 from $5.0 million for the nine months
ended  September  30, 2004.  The $0.3  million  decrease was a result of reduced
general operating  expenses,  primarily  personnel and other corporate  overhead
costs.  During the nine month period  ended  September  30, 2005,  we incurred a
restructuring  charge of $273,000  for a minimum  withdrawal  pension  liability
settlement with the former union  representing  employees of the Bronx, New York
facility which was closed in December 2003.

        Amortization  expense remained  approximately $0.7 million for both nine
month periods ended September 30, 2005 and 2004.

        Operating  income  increased  to $1.7  million for the nine months ended
September  30, 2005 from $0.7  million  for the  September  30, 2004  comparable
period.  The  increase in operating  income for the 2005 period was  primarily a
result of higher gross profit dollars and a decrease in operating  expenses,  as
explained above.

        Interest expense and finance costs, net of interest income, increased to
$1.6  million  in  the  nine  month  period  ending   September  30,  2005  from
approximately  $1.0 million  during the September 30, 2004 period.  The increase
was due to higher borrowing costs associated with our average outstanding factor
balance as compared to the prior  period,  and  borrowings  associated  with our
outstanding $4 million notes payable and  amortization of deferred finance costs
associated with our preferred stock refinance  completed in January 2004. During
the nine months ended September 30, 2005, we did not incur any interest  expense
associated with our redeemable participating preferred stock due to our net loss

                                      -15-





for the nine month period.  In the September 2004 period,  our after tax profits
required  us to incur a recorded  interest  charge of  $14,000,  pursuant to our
agreement with the holders of our preferred stock.

        Income  before  income  taxes from  continuing  operations  for the nine
months ended September 30, 2005 was $109,000  compared to $287,000  pre-tax loss
from  continuing  operations for the nine month period ended September 30, 2004.
The  increase in pre-tax  profits  from  continuing  operations  was a result of
higher operating profits offset by higher interest costs, as explained above.

        We  recognized  a tax  provision  of $90,000 for the nine  months  ended
September  30, 2005 as compared to a tax benefit of $110,000 for the nine months
ended September 30, 2004.

         Net income from  continuing  operations was $19,000 in 2005 as compared
to a net loss of $177,000 in 2004.  Income,  net of tax,  from the  discontinued
component  was  $195,000  during the nine  months  ended  September  30, 2004 as
compared to a loss from our  discontinued  component,  net of tax of $534,000 in
2005.  Accordingly,  our net loss for the nine months ended  September  30, 2005
from  continuing  and  discontinued  operations  was $515,000 as compared to net
income in the nine months ended September 30, 2004 of $18,000.

        We are required to pay a dividend  (presented as interest expense on our
statement of operations  in accordance  with SFAS No. 150,) equal to the product
of 2/3 of the sum of the net after tax  profits  reduced  in  proportion  to the
redeemed  preferred  stock and are payable on March of the following  year.  The
accrued  dividend  payable  for the nine  months  ended  September  30, 2004 was
$14,000 as compared to $ nil for the nine months ended  September 30, 2005.  The
2004 dividend was equal to 44.4% of net after tax profits.

LIQUIDITY AND CAPITAL RESOURCES

        We finance our operations and growth primarily with cash flows generated
from operations and from  borrowings  with our Factor ( a financing  entity that
factors  our  apparel  accounts  receivable  and  provides  us  working  capital
financing  (the  "Factor"))  from a $20  million  discretionary  demand  line of
credit.

        Net cash  provided by  operating  activities  for the nine months  ended
September  30, 2005 was $5.1 million as compared to  approximately  $1.0 million
for the nine months ended  September 30, 2004. The large increase was due to the
aforementioned  women's  apparel  component being disposed of resulting in their
respective  inventories and  receivables  being converted to cash. Net cash used
for  investing  activities  for the nine  months  ended  September  30, 2005 was
$303,000 as compared to $483,000 for the nine months ended September 30, 2004.

            During the nine months ended  September  30, 2005,  our primary need
for funds was to finance working capital and for the repayment of the borrowings
from our Factor.  Borrowings  from our Factor during the year ended December 31,
2004 were used to pay the $3  million  preferred  stock  redemption  along  with
interest  and  finance  costs of $0.8  million.  During  the nine  months  ended
September  30,  2005,  we repaid our Factor $5.4  million,  primarily  from cash
generated from our  discontinued  apparel  component,  reducing our  outstanding
obligation, net of factored receivables to $11.4 million at September 30, 2005.

        Net cash used in  financing  activities  was $5.3  million  for the nine
month period ended  September  30, 2005 as compared to $1.9 million for the nine
month period ended September 30, 2004. This increase in financing  activities is
primarily due to aforementioned  repayment of borrowings from our Factor, offset
by proceeds  from  exercises of stock  options of $0.3  million  during the nine
month period September 30, 2005.

        At  September  30,  2005,  cash and cash  equivalents  was $0.1  million
compared to $0.6 million at December 31, 2004.  Working capital was $2.5 million
at September 30, 2005 compared to $2.0 million at December 31, 2004.

                                      -16-





        Management anticipates it will generate and maintain sufficient cash and
cash  equivalent  balances,  along  with  availability  under  our  $20  million
discretionary  demand line of credit from our Factor,  although no  assurance to
that  effect  can be given,  to fund our  contractual  obligations  and  working
capital needs.  Positive cash flow, if it occurs, will create working capital to
fund our anticipated  growth over the next 12 months,  the mandatory  redemption
requirements  of our  preferred  stock and interest on the notes  payable due in
December 2005. If a positive cash flow does not occur,  there will be a decrease
in cash, and/or borrowings with the factor and/or other lenders will increase.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

        There  have been no  changes  in  financial  market  risk as  originally
discussed  in our  Annual  Report on Form 10-K for the year ended  December  31,
2004.

ITEM 4. CONTROLS AND PROCEDURES

        Based on their  evaluation,  as of the end of the period covered by this
report,  our Chief Executive  Officer and Chief Financial Officer have concluded
our  disclosure  controls and  procedures (as defined in Rules 13a-14 and 15d-14
under the  Securities  Exchange Act of 1934) are  effective.  There have been no
significant  changes  in  internal  controls  or in  other  factors  that  could
significantly  affect these controls subsequent to the date of their evaluation,
including any  corrective  actions with regard to significant  deficiencies  and
material weaknesses.

PART II.  OTHER INFORMATION

ITEM 6. EXHIBITS

        31.1          Certification of Chief Executive  Officer pursuant to Rule
                      13a-14(a) and Rule  15d-14(a) of the  Securities  Exchange
                      Act, as amended
        31.2          Certification of Chief Financial  Officer pursuant to Rule
                      13a-14(a) and Rule  15d-14(a) of the  Securities  Exchange
                      Act, as amended

        32.1          Certification  of Chief Executive  Officer  Pursuant to 18
                      U.S.C.  1350,  as adopted  pursuant  to Section 906 of the
                      Sarbanes-Oxley Act of 2002
        32.2          Certification  of Chief Financial  Officer  Pursuant to 18
                      U.S.C.  1350,  as adopted  pursuant  to Section 906 of the
                      Sarbanes-Oxley Act of 2002

                                      -17-






                                   SIGNATURES


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


                                            EVERLAST WORLDWIDE INC.


Date: November 10, 2005                     By:  /s/ George Q Horowitz
                                                 ---------------------
                                            Name:  George Q Horowitz
                                            Title: Chief Executive Officer,




                                            By:  /s/ Gary J. Dailey
                                                 ------------------------
                                            Name:  Gary J. Dailey
                                            Title: Chief Financial Officer,
                                                   Chief Accounting Officer

                                      -18-