10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

 FORM 10-Q

☑ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended November 30, 2012

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934

For the transition period from ______ to _______

Commission File Number 333-161868

USA GRAPHITE INC.

(Exact name of registrant as specified in its charter)

Nevada	26-2940624
(State of incorporation)	(I.R.S. Employer Identification No.)

848 N. Rainbow Blvd. #3550

Las Vegas, Nevada 89107

(Address of principal executive offices)

(603) 525-3380

(Registrant’s telephone number)

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     ☐ 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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☐Yes     ☐ No (Not required)

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

 Large Accelerated Filer ☐ Accelerated Filer ☐

Non-Accelerated Filer ☐ Smaller Reporting Company ☑

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

☐ Yes  ☑ No

As of November 30, 2012, there were 169,400,000shares of the registrant’s $0.001 par value common stock issued and outstanding.

USA GRAPHITE INC.

TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS	3
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	12
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	13
ITEM 4.	CONTROLS AND PROCEDURES	13
PART II. OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	14
ITEM 1A.	RISK FACTORS	14
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	14
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	15
ITEM 4.	MINE SAFETY DISCLOSURES	15
ITEM 5.	OTHER INFORMATION	15
ITEM 6.	EXHIBITS	16

Special Note Regarding Forward-Looking Statements

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of USA Graphite Inc. (the “Company”), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

*Please note that throughout this Quarterly Report, and unless otherwise noted, the words "we," "our," "us," the "Company," or "USGT" refers to USA Graphite Inc.

 PART I - FINANCIAL INFORMATION

ITEM 1.  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

USA GRAPHITE INC.
(Formerly MAGNUM OIL, INC.)
(A Development Stage Company)
CONSOLIDATED FINANCIAL STATEMENTS
November 30, 2012
Unaudited
CONSOLIDATED BALANCE SHEETS	F-1
CONSOLIDATED STATEMENTS OF OPERATIONS	F-2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)	F-3
CONSOLIDATED STATEMENTS OF CASH FLOWS	F-4
NOTES TO FINANCIAL STATEMENTS	F-5

3

USA GRAPHITE INC.
(Formerly MAGNUM OIL, INC.)
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
		November 30, 2012		February 29, 2012
		Unaudited		Audited
ASSETS
CURRENT ASSETS
Cash	$	12	$	2,935
Prepaid Expenses		2,200		5,912
TOTAL ASSETS	$	2,212	$	8,847
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	30,607	$	15,880
Note Payable		42,232		40,808
Loans from Related Party		109,544		91,931
TOTAL CURRENT LIABILITIES	$	182,383	$	148,619
STOCKHOLDERS' DEFICIT
Capital stock
Authorized
10,000,000 preferred shares, par value $0.001 par value
800,000,000 shares of common stock, $0.001 par value
Issued and outstanding
169,400,000 shares of common stock	$	169,400	$	169,400
Additional Paid in Capital		(104,400)		(104,400)
Deficit accumulated during the development stage		(245,171)		(204,772)
TOTAL STOCKHOLDERS' DEFICIT	$	(180,171)	$	(139,772)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	2,212	$	8,847
The accompanying notes are an integral part of these financial statements

F-1

USA GRAPHITE INC.
(Formerly MAGNUM OIL, INC.)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited
										Inception date
		Three months		Three months		Nine months		Nine months		(December 13, 2005)
		ended		ended		ended		ended		to
		November 30, 2012		November 30, 2011		November 30, 2012		November 30, 2011		November 30, 2012
EXPENSES
Office and general	$	6,448	$	3,650	$	11,040	$	18,841	$	71,262
Professional Fees		5,044		8,970		27,934		22,757		101,150
Total Expenses	$	11,492	$	12,620	$	38,974	$	41,598	$	172,412
Operating Loss		(11,492)		(12,620)		(38,974)		(41,598)		(172,412)
Other losses
Interest expense		(475)		(470)		(1,425)		(1,420)		(4,549)
Foreign Currency transaction loss		-		-		-				(120)
Net loss		(475)		(470)		(1,425)		(1,420)		(4,669)
Net Loss from continued operations		(11,967)		(13,089)		(40,399)		(43,017)		(177,081)
Discontinued Business		-		-		-		-		(151,510)
Forgiveness of Debt		-		-		-		-		83,420
Total other Expenditure		-		-		-		-		(68,090)
NET LOSS	$	(11,967)	$	(13,089)	$	(40,399)	$	(43,017)	$	(245,171)
BASIC AND DILUTED LOSS PER COMMON SHARE - DISCONTINUED OPERATION
	$	-	$	-	$	-	$	-
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
	$	169,400,000	$	169,400,000		169,400,000		169,400,000
The accompanying notes are an integral part of these financial statements

F-2

USA GRAPHITE INC.
(Formerly MAGNUM OIL, INC.)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
From inception (December 13, 2005) to November 30, 2012
Unaudited
							Deficit
	Common Stock						accumulated		Accumulated
					Additional		during the		Other
	Number of				Paid-in		development		Comprehensive
	shares		Amount		Capital		stage		Income(loss)		Total
Common stock issued for cash at $0.000065
per share on December 14, 2005	77,000,000	$	77,000	$	(72,000)	$	-	$	-	$	5,000
Net loss, February 28, 2006							(983)				(983)
Foreign currency translation adjustments									34		34
Balance, February 28, 2006	77,000,000	$	77,000	$	(72,000)	$	(983)	$	34	$	4,051
Stock issued for cash during the quarter
August 31, 2006 @$0.00065 per share	92,400,000		92,400		(32,400)						60,000
Net loss, February 28, 2007							-				-
Foreign currency translation adjustments									2,683		2,683
Balance, February 28, 2007	169,400,000	$	169,400	$	(104,400)	$	(983)	$	2,717	$	66,734
Net loss, February 28, 2008							(52,058)				(52,058)
Foreign currency translation adjustments									350		350
Balance, February 28, 2008	169,400,000	$	169,400	$	(104,400)	$	(53,041)	$	3,067	$	15,026
Net loss, February 28, 2009							(75,309)				(75,309)
Foreign currency translation adjustments									5,988		5,988
Balance, February 28, 2009	169,400,000	$	169,400	$	(104,400)	$	(128,350)	$	9,055	$	(54,295)
Net loss, February 28, 2010							(45,238)				(45,238)
Foreign currency translation adjustments									(6,360)		(6,360)
Balance, February 28, 2010	169,400,000	$	169,400	$	(104,400)	$	(173,588)	$	2,695	$	(105,893)
Net loss, February 28, 2011							23,538				23,538
Foreign currency translation adjustments									(2,695)		(2,695)
Balance, February 28, 2011	169,400,000	$	169,400	$	(104,400)	$	(150,050)	$	-	$	(85,050)
Net loss, February 29, 2012							(54,722)				(54,722)
Balance, February 29, 2012	169,400,000	$	169,400	$	(104,400)	$	(204,772)	$	-	$	(139,772)
Net Loss, November 30, 2012							(40,399)				(40,399)
Balance, November 30, 2012	169,400,000	$	169,400	$	(104,400)	$	(245,171)	$		$	(180,171)

F-3

USA GRAPHITE INC.
(Formerly MAGNUM OIL, INC.)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
Unaudited
			Nine months		Nine months		December 13, 2005
			ended		ended		(date of inception) to
			November 30, 2012		November 30, 2011		November 30, 2012
OPERATING ACTIVITIES
	Net loss	$	(40,399)	$	(43,017)	$	(245,171)
	Adjustment to reconcile net loss to net cash
	used in operating activities
	Forgiveness of debt						(83,420)
	Depreciation		-		-		2,825
	Loss on Disposition of Assets		-		-		4,607
	Increase in Prepaid Expenses		3,712		(3,746)		(2,200)
	Foreign Transaction loss		-		-		696
	Increase (decrease) in accrued expenses		14,727		(6,961)		114,029
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
		$	(21,960)	$	(53,724)	$	(208,634)
INVESTING ACTIVITIES
	Purchase of fixed assets		-		-		(11,468)
	Disposition of fixed assets		-		-		3,337
NET CASH PROVIDED BY INVESTING ACTIVITIES
		$	-	$	-	$	(8,131)
FINANCING ACTIVITIES
	Proceeds from sale of common stock		-		-		2,200
	Additional paid-in capital		-		-		62,800
	Note Payable		1,425		1,420		42,233
	Loan from related party		17,612		58,950		109,544
NET CASH PROVIDED BY FINANCING ACTIVITIES
		$	19,037	$	60,370	$	216,777
NET INCREASE (DECREASE) IN CASH		$	(2,923)	$	6,645	$	12
CASH, BEGINNING OF PERIOD		$	2,935	$	2,819	$	-
CASH, END OF PERIOD		$	12	$	9,464	$	12
Supplemental cash flow information and noncash financing activities:
Cash paid for:
	Interest	$	-	$	-	$	-
	Income taxes	$	-	$	-	$	-

F-4

USA GRAPHITE INC.

(A Development Stage Enterprise)

NOTES TO THE UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

November 30, 2012

NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION

USA GRAPHITE, INC. (Formerly MAGNUM OIL, INC.) (the “Company”) was incorporated under the laws of the State of Nevada on December 13, 2005. The Company is in the development stage. Its activities to date have included capital formation, organization and development of its business plan. The Company has commenced operations. On April 12, 2012 the company changed its name to USA Graphite, Inc.

The Company operated through its lone subsidiary: PTM Publications Sdn Bhd, a Malaysian Corporation.

The Company decided to cease the operation of subsidiary in January 2011.

USA GRAPHITE, INC. (the parent company) is now a holding company.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting

The Company’s financial statements are prepared using the accrual method of accounting. The Company has elected a February year-end.

Cash Equivalents

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

Use of Estimates and Assumptions

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

Stock-Based Compensation

The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Based Compensation, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.

Recent Accounting Pronouncements

The company has evaluated all the recent accounting pronouncements and believes that none of them will have a material effect on the company’s financial statement.

F-5

NOTE 3 – GOING CONCERN

The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company has a working capital deficit of $180,171, an accumulated deficit of $245,171 and net loss from operations since inception of $245,171. The Company does not have a source of revenue sufficient to cover its operation costs giving substantial doubt for it to continue as a going concern. The Company will be dependent upon the raising of additional capital through placement of our common stock in order to implement its business plan, or merge with an operating company. There can be no assurance that the Company will be successful in either situation in order to continue as a going concern. The Company is funding its initial operations by way of issuing Founder’s shares.

The officers and directors have committed to advancing certain operating costs of the Company, including Legal, Audit, Transfer Agency and Edgarizing costs

NOTE 4 - FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company has determined the estimated fair value of financial instruments using available market information and appropriate valuation methodologies. The fair value of financial instruments classified as current assets or liabilities approximate their carrying value due to the short-term maturity of the instruments.

NOTE 5 - WARRANTS AND OPTIONS

There are no warrants or options outstanding to acquire any additional shares of common.

NOTE 6 - DIRECTOR'S FEES

Fees of $500 per month have been recorded for the remuneration of the previous director and $2,000 per month for the current director from November 2012.

NOTE 7 - RELATED PARTY TRANSACTIONS

As of November 30, 2012, there is a total of $109,544 that has been forwarded by officers of the Company; no specific repayment terms have been established. 

NOTE 8 - INCOME TAXES

We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating losses since inception. Accounting for Uncertainty in Income Taxes when it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit.  We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carry forwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carry forward period.

The components of the Company’s deferred tax asset and reconciliation of income taxes computed at the statutory rate to the income tax amount recorded as of are as follows:

	November 30, 2012
Net operating loss carryforwards	$ 245,171
Gross deferred tax assets	$ 85,810
Valuation allowance	$ (85,810)
Net deferred tax assets	$ 0

Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carryforwards are expected to be available to reduce taxable income. As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance.

F-6

NOTE 9 - NET OPERATING LOSSES

As of November 30, 2012, the Company has a net operating loss carryforwards of approximately $245,171. Net operating loss carryforward expires twenty years from the date the loss was incurred.

NOTE 10 - STOCK TRANSACTIONS

Transactions, other than employees’ stock issuance, are in accordance with ASC 505. Thus issuances shall be accounted for based on the fair value of the consideration received. Transactions with employees’ stock issuance are in accordance with ASC 718. These issuances shall be accounted for based on the fair value of the consideration received or the fair value of the equity instruments issued, or whichever is more readily determinable.

On December 14, 2005, the company issued a total of 22,000,000 shares of $0.000455 par value common stock as founder's shares to Jasmin Bin Omar Jayaseelan, Jefferi Bin Omar Jayaseelan and Cheryl Lim Phaik Suan, all of whom are officers and directors of the company. Mr. Jasmin Jayaseelan and Mr. Jefferi Jayaseelan received 8,800,000 shares each, and Ms. Lim received 4,400,000 shares. The shares were issued in exchange for cash in the aggregate amount of $5,000.

In August 2006, the company completed an offering of shares of common stock in accordance with an SB-2 registration statement declared effective by the Securities and Exchange Commission on May 4, 2006. The company sold 26,400,000 shares of common stock, par value $0.001, at a price of $0.0227 per share to approximately 32 investors. The aggregate offering price for the offering closed in August 2006 was $60,000, all of which was collected from the offering.

On May 23, 2010 the company received approval from FINRA for a forward split of common share of 22:1.

On April 17, 2012 the company received approval from FINRA for a forward slit of 3.5:1. All share amounts have been retroactively adjusted for all periods presented.

On August 28, 2012 the company amended the authorized common shares from 175,000,000 to 800,000,000 common shares of $0.001 per share. On the same day the company authorized 10,000,000 preferred shares, par value $0.001 per share. None were previously authorized.

As of November 30, 2012, the Company had 169,400,000 shares of common stock issued and outstanding.

NOTE 11 - STOCKHOLDERS’ EQUITY

The stockholders’ equity section of the Company contains the following classes of capital stock as at November 30, 2012:
Common stock, $ 0.001 par value: 175,000,000 shares authorized; 169,400,000 shares issued and outstanding.

No preferred shares have been authorized or issued.

F-7

NOTE 12 - SUBSEQUENT EVENTS

On November 19, 2012, the Company entered into a Property Option Agreement with Nevada Minerals Holdings, Inc. Pursuant to the terms and conditions of the Option Agreement, NV Minerals shall grant the Company with the right and option to acquire 100% of the mining interests in that certain Property known as the Blue Wing Mountains Graphite Project which is comprised of a total 1,985 acres and is located in Pershing County of the State of Nevada. In order to exercise the Option, the Company shall be required to: (i) pay an initial cash payment of $50,000 to NV Minerals; (ii) issue an aggregate 5,000,000 restricted shares of the Company’s common stock to NV Minerals; (iii) pay an additional aggregate payment of $450,000 over a three (3) year period; and (iv) pay a Royalty to NV Minerals equal to 2% of the net smelter returns, per the terms and conditions of the Option Agreement. The Company will also provide funds for the conduct of a program of work to be undertaken by NV Minerals for the benefit of the Property of not less than $1,000,000 over four years. The Option Agreement also provides that the Company shall have a one-time right to purchase 50% of the Royalty in the Property for $500,000. Pursuant to the Option Agreement, NV Minerals has agreed to enter into an 18 month voluntary lock up agreement for all of the shares it will receive upon execution of the Option Agreement.

On December 7, 2012, the Company entered into an Option Agreement with Nevada Minerals Holdings, Inc. Pursuant to the terms and conditions of the Agreement, NV Minerals shall grant the Company with the right and option to acquire 100% of the mining interests in that certain Property known as the Gordon Creek Graphite Property which is comprised of a total of 206 acres and is located in Elko County of the State of Nevada. In exchange, the Company is required to: (i) pay an aggregate payment of 200,000 over a 4 year period to NV Minerals; (ii) issue an aggregate of 2,000,000 restricted shares of the Company’s common stock to NV Minerals; and (iii) pay a production royalty to NV Minerals equal to 2% of the net smelter returns, per the terms and conditions of the Agreement.

On December 10, 2012, the Company entered into an Employment Agreement with Wayne Yamamoto. Pursuant to the Agreement, Mr. Smith agreed to serve as Chief Executive Officer of the Company. In exchange, the Company has agreed to: (i) pay Mr. Yamamoto $2,000 per month; and (ii) issue 30,000,000 shares of the Company’s common stock to Mr. Yamamoto. This Agreement is at-will and can be terminated at any time by either the Company or Mr. Yamamoto. On December 5, 2012 the company issued the 30,000,000 common shares for compensation.

On January 14, 2013,Company entered into a Letter of Intent with Nevada Minerals Holdings, Inc. Pursuant to the terms and conditions of the LOI, NV Minerals shall grant the Company with the right and option to acquire 100% of the mining interests in that certain Property known as the Ruby Mountains Graphite Property which is comprised of a total of approximately 785 acres and is located in Elko County of the State of Nevada. In exchange, the Company is required to: (i) pay an initial cash payment of $25,000 to NV Minerals; (ii) issue an aggregate 4,615,000 restricted shares of the Company’s common stock to NV Minerals; (iii) pay an additional payment of $175,000 over a three (3) year period; and (iv) pay a production royalty to NV Minerals equal to 2% of the net smelter returns, per the terms and conditions of the LOI.

On December 5, the company issued 7,000,000 shares to Nevada Minerals holdings Inc., for which the company has received full consideration.

F-8

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

FORWARD-LOOKING STATEMENTS

This Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) contains forward-looking statements that involve known and unknown risks, significant uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, or implied, by those forward-looking statements.  You can identify forward-looking statements by the use of the words may, will, should, could, expects, plans, anticipates, believes, estimates, predicts, intends, potential, proposed, or continue or the negative of those terms.  These statements are only predictions. In evaluating these statements, you should consider various factors which may cause our actual results to differ materially from any forward-looking statements.  Although we believe that the exceptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.  Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements.  We undertake no obligation to revise or update publicly any forward-looking statements for any reason.

Results of Operations

Our financial statements and information for the three and nine months ended November 30, 2012 have been prepared by our Management on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business.  We generated no revenues during the three and nine months ended November 30, 2012 and have incurred total net losses of $245,171 from inception to November 30, 2012.  

Three months Ended November 30, 2012 compared to the Three months Ended November 30, 2011

We incurred net losses of $11,967, or $0.00 per share, for the three-month period ended November 30, 2012, as compared to a net loss of $13,089, or $0.00 per share, for the three-month period ended November 30, 2011.  The decrease was mainly attributed to reduced professional fees ($5,044 - 2012 compared to $8,970 – 2011).  Our other expenses for the three-month period ended November 30, 2012 consisted of office and general expenses of $6,448 ($3,650 - 2011) and interest expense of $475 ($470 - 2011). 

Nine Months Ended November 30, 2012 compared to the Nine Months Ended November 30, 2011

We incurred net losses of $40,399, or $0.00 per share, for the nine-month period ended November 30, 2012, as compared to a net loss of $43,017, or $0.00 per share, for the nine-month period ended November 30, 2011.  The decrease was mainly attributed to reduced office and general expenses ($11,040 - 2012 compared to $18,841 – 2011).  Our other expenses for the nine-month period ended November 30, 2012 consisted of professional fees in the amount of $27,934 ($22,757 - 2011), and interest expense of $1,425 ($1,420 - 2011).

Liquidity and Capital Resources

At November 30, 2012, we had total assets of $2,212 consisting of cash in the bank in the amount of $12 and prepaid expenses of $2,200.

Our accounts payable and accrued liabilities at November 30, 2012 were $30,607.

There are currently no options, warrants, rights or other securities conversion rights issued and/or outstanding.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

Inflation

The amounts presented in the financial statements do not provide for the effect of inflation on our operations or financial position.  The net operating losses shown would be greater than reported if the effects of inflation were reflected either by charging operations with amounts that represent replacement costs or by using other inflation adjustments.

12

 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a non-accelerated filer and a smaller reporting company, as defined in Rule 12b-2 of the of the Securities Exchange Act of 1934, and as such, are not required to provide the information under this item.

 ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934 (the "Exchange Act"), that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that such information is accumulated and communicated to our sole officer, as appropriate to allow timely decisions regarding required disclosure. We carried out an evaluation, under the supervision and with the participation of our sole officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of November 30, 2012.  Based on the evaluation of these disclosure controls and procedures, and in light of the material weaknesses in our internal control over financial reporting identified in our Annual Report on Form 10-K for the year ended February 29, 2012, the sole officer concluded that our disclosure controls and procedures are ineffective.

Changes in internal controls

We have not yet implemented any of the recommended changes to internal control over financial reporting listed in our Annual Report on Form 10-K for the year ended February 29, 2012.  As such, there were no changes in our internal control over financial reporting, as defined in Rule 13a-15(f) promulgated under the Exchange Act, during the quarter ended November 30, 2012 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

13

PART II - OTHER INFORMATION

 ITEM 1. LEGAL PROCEEDINGS

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which our director, officer or any affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

 ITEM 1A. RISK FACTORS

Our Annual Report on Form 10-K for the fiscal year ended February 29, 2012 includes a detailed discussion of our risk factors.

 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

1. Quarterly Issuances:

During the quarter, we did not issue any unregistered securities other than as previously disclosed.

2. Subsequent Issuances:

Subsequent to the quarter, we issued the following unregistered securities:

On December 5, 2012, we issued 5,000,000 restricted shares of the Company’s common stock to Nevada Minerals Holdings, Inc. pursuant to the Property Option Agreement entered into by the Company and Nevada Minerals Holdings, Inc. regarding the option to acquire the Blue Wings Mountain Graphite Property.

On December 5, 2012, we issued 30,000,000 restricted shares of the Company’s common stock to Mr. Wayne Yamamoto.

On December 6, 2012, we issued 2,000,000 restricted shares of the Company’s common stock to Nevada Minerals Holdings, Inc. pursuant to the Property Option Agreement between USA Graphite, Inc. and Nevada Minerals Holdings, Inc. regarding the option to acquire the Gordon Creek Graphite Property.

14

 ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None. 

ITEM 4.	MINE SAFETY DISCLOSURES
The information concerning mine safety violations and other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K (17 CFR 229.104) is not included in this quarterly report because it is not applicable.

ITEM 5. OTHER INFORMATION

None.

15

ITEM 6. EXHIBITS

Exhibit Number	Description	Filed
3.1 (a)	Articles of Incorporation filed with the Nevada Secretary of State on December 13, 2005.	Incorporated by reference as Exhibits to the Form SB-2 filed on April 27, 2006.
3.1 (b)	Amendment to Articles of Incorporation filed with the Nevada Secretary of State on June 17, 2010.	Incorporated by reference as Exhibit to the Form 8-K filed on July 16, 2010.
3.1 (c)	Amendment to Articles of Incorporation filed with the Nevada Secretary of State on April 11, 2012.	Incorporated by reference as Exhibit to the Form 8-K filed on April 18, 2012.
3.1 (d)	Amendment to Articles of Incorporation filed with the Nevada Secretary of State on August 28, 2012.	Incorporated by reference as Exhibit to the Form 8-K filed on August 29, 2012.
3.2	Bylaws.	Incorporated by reference as Exhibits to the Form SB-2 filed on April 27, 2006.
10.01 (a)	Letter of Intent Between USA Graphite, Inc. and Nevada Minerals Holdings, Inc. Regarding the Option to Acquire the Ruby Mountains Graphite Property.	Incorporated by reference as Exhibits to the Form 8-K filed on January 15, 2013.
10.01 (b)	Employment Agreement Between USA Graphite, Inc. and Wayne Yamamoto.	Incorporated by reference as Exhibits to the Form 8-K filed on December 11, 2012.
10.01 (c)	Option Agreement Between USA Graphite, Inc. and Nevada Minerals Holdings, Inc. Regarding the Option to Acquire the Gordon Creek Graphite Property.	Incorporated by reference as Exhibits to the Form 8-K filed on December 10, 2012.
10.01(d)	Property Option Agreement Between USA Graphite, Inc. and Nevada Minerals Holdings, Inc. Regarding the Option to Acquire the Blue Wings Mountain Graphite Property.	Incorporated by reference as Exhibits to the Form 8-K filed on November 20, 2012.
31.1	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	Filed herewith.
31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.	Filed herewith.
32.1	Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	Filed herewith.
32.2	Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.	Filed herewith.
101.INS*	XBRL Instance Document.	Filed herewith.
101.SCH*	XBRL Taxonomy Extension Schema Document.	Filed herewith.
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document.	Filed herewith.
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document.	Filed herewith.
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document.	Filed herewith.
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document.	Filed herewith.

*Pursuant to Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

16

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	USA GRAPHITE INC.
Date: January 22, 2013	/s/ Wayne Yamamoto
	By: Wayne Yamamoto
	Its: Chief Executive Officer Chief Financial Officer Treasurer, Secretary and Director

Pursuant to the requirement of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:

EX-31.01

Exhibit 31.01

CERTIFICATION OF THE PRINCIPAL EXECUTIVE OFFICER PURSUANT TO RULE 13a-14

I, Wayne Yamamoto, certify that:

  1. I have reviewed this quarterly report on Form 10-Q of USA Graphite Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)         Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)         Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)         Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)         Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)         All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)         Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: January 22, 2013	USA GRAPHITE INC.
	/s/ Wayne Yamamoto
	By: Wayne Yamamoto
	Its: Principal Executive Officer

EX-31.02

Exhibit 31.02

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO RULE 13a-14

I, Wayne Yamamoto, certify that:

  1. I have reviewed this quarterly report on Form 10-Q of USA Graphite Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)         Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)         Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)         Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)         Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)         All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)         Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: January 22, 2013	USA GRAPHITE INC.
	/s/ Wayne Yamamoto
	By: Wayne Yamamoto
	Its: Principal Financial Officer

EX-32.01

Exhibit 32.01

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of USA Graphite Inc (the “Company”) on Form 10-Q for the period ending November 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Wayne Yamamoto certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief:

(1)        The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 

(2)        The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: January 22, 2013	USA GRAPHITE INC.
	/s/ Wayne Yamamoto
	By: Wayne Yamamoto
	Its: Chief Executive Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.02

Exhibit 32.02

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of USA Graphite Inc (the “Company”) on Form 10-Q for the period ending November 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Wayne Yamamoto certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief:

(1)        The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)        The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

Date: January 22, 2013	USA GRAPHITE INC.
	/s/ Wayne Yamamoto
	By: Wayne Yamamoto
	Its: Principal Financial Officer

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

INCOME TAXES - Deferred tax asset and reconciliation of income taxes (Details) (USD $)	Nov. 30, 2012
Income Tax Disclosure [Abstract]
Net operating loss carryforwards	$ 245,171
Gross deferred tax assets	85,110
Valuation allowance	(85,110)
Net deferred tax assets	$ 0

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Nov. 30, 2012

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting

The Company’s financial statements are prepared using the accrual method of accounting. The Company has elected a February year-end.

Cash Equivalents

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

Use of Estimates and Assumptions

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

Stock-Based Compensation

The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Based Compensation, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.

Recent Accounting Pronouncements

The company has evaluated all the recent accounting pronouncements and believes that none of them will have a material effect on the company’s financial statement.

XML

SUBSEQUENT EVENTS (Details Narrative) (USD $)	Jan. 14, 2013	Dec. 10, 2012	Dec. 07, 2012	Dec. 05, 2012	Nov. 19, 2012
Subsequent Events [Abstract]
Option percentage to acquire Blue Wing Mountains Graphite Project					100.00%
Initial cash payment to NV Minerals		$ 25,000			$ 50,000
Aggregate restricted shares issued to NV Minerals		4,615,000	2,000,000		5,000,000
Additional aggregate payment over three years to NV Minerals		175,000			450,000
Additional aggregate payment over four years to NV Minerals			200,000
Royalty to NV Minerals equal to percentage of net smelter returns		2.00%	2.00%		2.00%
Funds provided to conduct program of work to be undertaken by NV Minerals					1,000,000
One-time right to purchase fifty percent pf Royalty in the Property					500,000
Option percentage to acquire Gordon Creek Graphite Property			100.00%
Employment agreement with CEO, payment per month		2,000
Employment agreement with CEO, common stock issued		30,000,000
Option percentage to acquire Ruby Mountains Graphite Property	100.00%
Common shares issued for compensation				$ 30,000,000
Issued shares to NV Minerals, full consideration received				7,000,000

XML

STOCKHOLDERS’ EQUITY (Details Narrative) (USD $)	Nov. 30, 2012	Aug. 28, 2012	Feb. 29, 2012	Aug. 31, 2006
Equity [Abstract]
Common stock par value	$ 0.001		$ 0.001	$ 0.001
Common stock, shares authorized	800,000,000		800,000,000
Common stock, shares issued	169,400,000		169,400,000
Common stock, shares outstanding	169,400,000		169,400,000
Preferred stock, par value	$ 0.001		$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000	10,000,000
Preferred stock, shares issued	0
Preferred stock, shares outstanding	0

XML

NATURE OF OPERATIONS AND BASIS OF PRESENTATION

3 Months Ended

Nov. 30, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

NATURE OF OPERATIONS AND BASIS OF PRESENTATION

NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION 

USA GRAPHITE, INC. (Formerly MAGNUM OIL, INC.) (the “Company”) was incorporated under the laws of the State of Nevada on December 13, 2005. The Company is in the development stage. Its activities to date have included capital formation, organization and development of its business plan. The Company has commenced operations. On April 12, 2012 the company changed its name to USA Graphite, Inc.

The Company operated through its lone subsidiary: PTM Publications Sdn Bhd, a Malaysian Corporation.

The Company decided to cease the operation of subsidiary in January 2011.

USA GRAPHITE, INC. (the parent company) is now a holding company.

XML

CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $)	Nov. 30, 2012	Feb. 29, 2012
CURRENT ASSETS
Cash	$ 12	$ 2,935
Prepaid Expenses	2,200	5,912
TOTAL ASSETS	2,212	8,847
CURRENT LIABILITIES
Accounts payable and accrued liabilities	30,607	15,880
Note Payable	42,232	40,808
Loans from Related Party	109,544	91,931
TOTAL CURRENT LIABILITIES	182,383	148,619
STOCKHOLDERS' DEFICIT
Capital stock Authorized 10,000,000 preferred shares, par value $0.001 par value 800,000,000 shares of common stock, $0.001 par value Issued and outstanding 169,400,000 shares of common stock	169,400	169,400
Additional Paid in Capital	(104,400)	(104,400)
Deficit accumulated during the development stage	(245,171)	(204,772)
TOTAL STOCKHOLDERS' DEFICIT	(180,171)	(139,772)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 2,212	$ 8,847

XML

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) (Parenthetical) (USD $)	Aug. 31, 2006	Dec. 15, 2005	Dec. 12, 2005
Statement of Stockholders' Equity [Abstract]
Common stock issued for cash, per share	$ 0.00065	$ 0.00065	$ 0.00065

XML

GOING CONCERN (Details Narrative) (USD $)	Nov. 30, 2012
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Working capital deficit	$ 180,171
Accumulated deficit	$ 245,171

XML

RELATED PARTY TRANSACTIONS (Details Narrative) (USD $)	Nov. 30, 2012
Related Party Transactions [Abstract]
Forwarded by officers of the Company	$ 109,544

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)	9 Months Ended		84 Months Ended
	Nov. 30, 2012	Nov. 30, 2011	Nov. 30, 2012
OPERATING ACTIVITIES
Net loss	$ (40,399)	$ (43,017)	$ (245,171)
Adjustment to reconcile net loss to net cash used in operating activities
Forgiveness of debt			(83,420)
Depreciation			2,825
Loss on Disposition of Assets			4,607
Increase in Prepaid Expenses	3,712	(3,746)	(2,200)
Foreign Transaction loss			696
Increase (decrease) in Accounts payable and accrued expenses	14,727	(6,961)	114,029
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES	(21,960)	(53,724)	(208,634)
INVESTING ACTIVITIES
Purchase of fixed assets			(11,468)
Disposition of fixed assets			3,337
NET CASH PROVIDED BY INVESTING ACTIVITIES			(8,131)
FINANCING ACTIVITIES
Proceeds from sale of common stock			2,200
Additional paid-in capital			62,800
Note Payable	1,425	1,420	42,233
Loan from related party	17,612	58,950	109,544
NET CASH PROVIDED BY FINANCING ACTIVITIES	19,037	60,370	216,777
NET INCREASE (DECREASE) IN CASH	(2,923)	6,645	12
CASH, BEGINNING OF PERIOD	2,935	2,819
CASH, END OF PERIOD	12	9,464	12
Cash paid for:
Interest
Income taxes

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Nov. 30, 2012	Aug. 28, 2012	Feb. 29, 2012	Aug. 31, 2006
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.001		$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000	10,000,000
Preferred stock, shares issued	0
Preferred stock, shares outstanding	0
Common stock par value	$ 0.001		$ 0.001	$ 0.001
Common stock, shares authorized	800,000,000		800,000,000
Common stock, shares issued	169,400,000		169,400,000
Common stock, shares outstanding	169,400,000		169,400,000

XML

STOCK TRANSACTIONS

3 Months Ended

Nov. 30, 2012

Notes to Financial Statements

STOCK TRANSACTIONS

NOTE 10 - STOCK TRANSACTIONS

Transactions, other than employees’ stock issuance, are in accordance with ASC 505. Thus issuances shall be accounted for based on the fair value of the consideration received. Transactions with employees’ stock issuance are in accordance with ASC 718. These issuances shall be accounted for based on the fair value of the consideration received or the fair value of the equity instruments issued, or whichever is more readily determinable.

On December 14, 2005, the company issued a total of 22,000,000 shares of $0.000455 par value common stock as founder's shares to Jasmin Bin Omar Jayaseelan, Jefferi Bin Omar Jayaseelan and Cheryl Lim Phaik Suan, all of whom are officers and directors of the company. Mr. Jasmin Jayaseelan and Mr. Jefferi Jayaseelan received 8,800,000 shares each, and Ms. Lim received 4,400,000 shares. The shares were issued in exchangefor cash in the aggregate amount of $5,000.

In August 2006, the company completed an offering of shares of common stock in accordance with an SB-2 registration statement declared effective by the Securities and Exchange Commission on May 4, 2006. The company sold 26,400,000 shares of common stock, par value $0.001, at a price of $0.0227 per share to approximately 32 investors. The aggregate offering price for the offering closed in August 2006 was $60,000, all of which was collected from the offering.

On May 23, 2010 the company received approval from FINRA for a forward split of common share of 22:1.

On April 17, 2012 the company received approval from FINRA for a forward slit of 3.5:1. All share amounts have been retroactively adjusted for all periods presented.  

On August 28, 2012 the company amended the authorized common shares from 175,000,000 to 800,000,000 common shares of $0.001 per share. On the same day the company authorized 10,000,000 preferred shares, par value $0.001 per share. None were previously authorized.

As of November 30, 2012, the Company had 169,400,000 shares of common stock issued and outstanding.

XML

Document and Entity Information	3 Months Ended
	Nov. 30, 2012
Document And Entity Information
Entity Registrant Name	USA Graphite Inc.
Entity Central Index Key	0001355420
Document Type	10-Q
Document Period End Date	Nov. 30, 2012
Amendment Flag	false
Current Fiscal Year End Date	--02-28
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding	169,400,000
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2012

XML

STOCKHOLDERS’ EQUITY

3 Months Ended

Nov. 30, 2012

Equity [Abstract]

STOCKHOLDERS’ EQUITY

NOTE 11 - STOCKHOLDERS’ EQUITY

The stockholders’ equity section of the Company contains the following classes of capital stock as at November 30, 2012:

Common stock, $ 0.001 par value: 800,000,000 shares authorized; 169,400,000 shares issued and outstanding.

Preferred shares, $0.001 par value: 10,000,000 shares authorized; no shares issued and outstanding.

XML

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $)	3 Months Ended		9 Months Ended		84 Months Ended
	Nov. 30, 2012	Nov. 30, 2011	Nov. 30, 2012	Nov. 30, 2011	Nov. 30, 2012
EXPENSES
Office and general	$ 6,448	$ 3,650	$ 11,040	$ 18,841	$ 71,262
Professional Fees	5,044	8,970	27,934	22,757	101,150
Total Expenses	11,492	12,620	38,974	41,598	172,412
Operating Loss	(11,492)	(12,620)	(38,974)	(41,598)	(172,412)
Other losses
Interest expense	(475)	(470)	(1,425)	(1,420)	(4,549)
Foreign Currency transaction loss					(120)
Net loss	(475)	(470)	(1,425)	(1,420)	(4,669)
Net Loss from continued operations	(11,967)	(13,089)	(40,399)	(43,017)	(177,081)
Discontinued Business					(151,510)
Forgiveness of debt					83,420
Total other Expenditure					(68,090)
NET LOSS	$ (11,967)	$ (13,089)	$ (40,399)	$ (43,017)	$ (245,171)
BASIC AND DILUTED LOSS PER COMMON SHARE - DISCONTINUED OPERATION
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING	169,400,000	169,400,000	169,400,000	169,400,000

XML

WARRANTS AND OPTIONS

3 Months Ended

Nov. 30, 2012

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

WARRANTS AND OPTIONS

NOTE 5 - WARRANTS AND OPTIONS

There are no warrants or options outstanding to acquire any additional shares of common.

XML

FAIR VALUE OF FINANCIAL INSTRUMENTS

3 Months Ended

Nov. 30, 2012

Accounting Policies [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENTS

NOTE 4 - FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company has determined the estimated fair value of financial instruments using available market information and appropriate valuation methodologies. The fair value of financial instruments classified as current assets or liabilities approximate their carrying value due to the short-term maturity of the instruments.

XML

DIRECTOR'S FEES (Details Narrative) (USD $)	1 Months Ended
	Nov. 30, 2012
Accounting Policies [Abstract]
Remuneration of the previous director, per month	$ 500
Current director fees, per month	$ 2,000

XML

SUBSEQUENT EVENTS

3 Months Ended

Nov. 30, 2012

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

NOTE 12 - SUBSEQUENT EVENTS

On November 19, 2012, the Company entered into a Property Option Agreement with Nevada Minerals Holdings, Inc. Pursuant to the terms and conditions of the Option Agreement, NV Minerals shall grant the Company with the right and option to acquire one hundred percent (100%) of the mining interests in that certain Property known as the Blue Wing Mountains Graphite Project which is comprised of a total 1,985 acres and is located in Pershing County of the State of Nevada. In order to exercise the Option, the Company shall be required to: (i) pay an initial cash payment of $50,000 to NV Minerals; (ii) issue an aggregate of five million (5,000,000) restricted shares of the Company’s common stock to NV Minerals; (iii) pay an additional aggregate payment of four hundred fifty thousand dollars ($450,000) over a three (3) year period; and (iv) pay a Royalty to NV Minerals equal to 2% of the net smelter returns, per the terms and conditions of the Option Agreement. The Company will also provide funds for the conduct of a program of work to be undertaken by NV Minerals for the benefit of the Property of not less than $1,000,000 over four years. The Option Agreement also provides that the Company shall have a one-time right to purchase 50% of the Royalty in the Property for $500,000. Pursuant to the Option Agreement, NV Minerals has agreed to enter into an 18 month voluntary lock up agreement for all of the shares it will receive upon execution of the Option Agreement.

On December 7, 2012, the Company entered into an Option Agreement with Nevada Minerals Holdings, Inc. Pursuant to the terms and conditions of the Agreement, NV Minerals shall grant the Company with the right and option to acquire 100% of the mining interests in that certain Property known as the Gordon Creek Graphite Property which is comprised of a total of 206 acres and is located in Elko County of the State of Nevada. In exchange, the Company is required to: (i) pay an aggregate payment of 200,000 over a 4 year period to NV Minerals; (ii) issue an aggregate of 2,000,000 restricted shares of the Company’s common stock to NV Minerals; and (iii) pay a production royalty to NV Minerals equal to 2% of the net smelter returns, per the terms and conditions of the Agreement.

On December 10, 2012, the Company entered into an Employment Agreement with Wayne Yamamoto. Pursuant to the Agreement, Mr. Smith agreed to serve as Chief Executive Officer of the Company. In exchange, the Company has agreed to: (i) pay Mr. Yamamoto $2,000 per month; and (ii) issue 30,000,000 shares of the Company’s common stock to Mr. Yamamoto. This Agreement is at-will and can be terminated at any time by either the Company or Mr. Yamamoto. On December 5, 2012 the company issued the 30,000,000 common shares for compensation.

On January 14, 2013, the Company entered into a Letter of Intent with Nevada Minerals Holdings, Inc. Pursuant to the terms and conditions of the LOI, NV Minerals shall grant the Company with the right and option to acquire 100% of the mining interests in that certain Property known as the Ruby Mountains Graphite Property which is comprised of a total of approximately 785 acres and is located in Elko County of the State of Nevada. In exchange, the Company is required to: (i) pay an initial cash payment of $25,000 to NV Minerals; (ii) issue an aggregate 4,615,000 restricted shares of the Company’s common stock to NV Minerals; (iii) pay an additional payment of $175,000 over a three (3) year period; and (iv) pay a production royalty to NV Minerals equal to 2% of the net smelter returns, per the terms and conditions of the LOI.  

On December 5 the company issued 7,000,000 shares to Nevada Minerals holdings Inc., for which the Company has received full consideration.

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INCOME TAXES

3 Months Ended

Nov. 30, 2012

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 8 - INCOME TAXES

We did not provide any current or deferred U.S. federal income tax provision or benefit for any of the periods presented because we have experienced operating losses since inception. Accounting for Uncertainty in Income Taxes when it is more likely than not that a tax asset cannot be realized through future income the Company must allow for this future tax benefit.  We provided a full valuation allowance on the net deferred tax asset, consisting of net operating loss carry forwards, because management has determined that it is more likely than not that we will not earn income sufficient to realize the deferred tax assets during the carry forward period.

The components of the Company’s deferred tax asset and reconciliation of income taxes computed at the statutory rate to the income tax amount recorded as of are as follows:

	November 30, 2012
Net operating loss carryforwards	$ 245,171
Gross deferred tax assets	$ 85,810
Valuation allowance	$ (85,810)
Net deferred tax assets	$ 0

Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carryforwards are expected to be available to reduce taxable income. As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance.

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DIRECTOR'S FEES

3 Months Ended

Nov. 30, 2012

Accounting Policies [Abstract]

DIRECTOR'S FEES

NOTE 6 - DIRECTOR'S FEES

Fees of $500 per month have been recorded for the remuneration of the previous director and $2,000 per month for the current director from November 2012.

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RELATED PARTY TRANSACTIONS

3 Months Ended

Nov. 30, 2012

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 7 - RELATED PARTY TRANSACTIONS

As of November 30, 2012, there is a total of $109,544 that has been forwarded by officers of the Company; no specific repayment terms have been established. 

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NET OPERATING LOSSES

3 Months Ended

Nov. 30, 2012

Other Income and Expenses [Abstract]

NET OPERATING LOSSES

NOTE 9 - NET OPERATING LOSSES

As of November 30, 2012, the Company has a net operating loss carryforwards of approximately $245,171. Net operating loss carryforward expires twenty years from the date the loss was incurred.

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INCOME TAXES (Tables)

3 Months Ended

Nov. 30, 2012

Income Tax Disclosure [Abstract]

Deferred tax asset and reconciliation of income taxes

	November 30, 2012
Net operating loss carryforwards	$ 245,171
Gross deferred tax assets	$ 85,110
Valuation allowance	$ (85,110)
Net deferred tax assets	$ 0

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NET OPERATING LOSSES (Details Narrative) (USD $)	Nov. 30, 2012
Other Income and Expenses [Abstract]
Net operating loss carryforwards	$ 245,171

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) (Unaudited) (USD $)	Common Stock	Additional Paid-in Capital	Deficit accumulated during the development stage	Accumulated Other Comprehensive Income (loss)	Total
Beginning balance, Amount at Feb. 28, 2006	$ 77,000	$ (72,000)	$ (983)	$ 34	$ 4,051
Beginning balance, Shares at Feb. 28, 2006	77,000,000
Common stock issued for cash at $0.000065 per share, Shares	92,400,000
Common stock issued for cash at $0.000065 per share, Amount	92,400	(32,400)			60,000
Foreign currency translation adjustments				2,683	2,683
Ending balance, Amount at Feb. 28, 2007	169,400	(104,400)	(983)	2,717	66,734
Ending balance, Shares at Feb. 28, 2007	169,400,000
Net loss			(52,058)		(52,058)
Foreign currency translation adjustments				350	350
Ending balance, Amount at Feb. 28, 2008	169,400	(104,400)	(53,041)	3,067	15,026
Ending balance, Shares at Feb. 28, 2008	169,400,000
Beginning balance, Amount at Dec. 13, 2005
Common stock issued for cash at $0.000065 per share, Shares	77,000,000
Common stock issued for cash at $0.000065 per share, Amount	77,000	(72,000)			5,000
Net loss			(983)		(983)
Foreign currency translation adjustments				34	34
Ending balance, Amount at Feb. 28, 2006	77,000	(72,000)	(983)	34	4,051
Ending balance, Shares at Feb. 28, 2006	77,000,000
Beginning balance, Amount at Feb. 29, 2008	169,400	(104,400)	(53,041)	3,067	15,026
Beginning balance, Shares at Feb. 29, 2008	169,400,000
Net loss			(75,309)		(75,309)
Foreign currency translation adjustments				5,988	5,988
Ending balance, Amount at Feb. 28, 2009	169,400	(104,400)	(128,350)	9,055	(54,295)
Ending balance, Shares at Feb. 28, 2009	169,400,000
Net loss			(45,238)		(45,238)
Foreign currency translation adjustments				(6,360)	(6,360)
Ending balance, Amount at Feb. 28, 2010	169,400	(104,400)	(173,588)	2,695	(105,893)
Ending balance, Shares at Feb. 28, 2010	169,400,000
Net loss			23,538		23,538
Foreign currency translation adjustments				(2,695)	(2,695)
Ending balance, Amount at Feb. 28, 2011	169,400	(104,400)	(150,050)		(85,050)
Ending balance, Shares at Feb. 28, 2011	169,400,000
Net loss			(54,722)		(54,722)
Ending balance, Amount at Feb. 29, 2012	169,400	(104,400)	(204,772)		(139,772)
Ending balance, Shares at Feb. 29, 2012	169,400,000
Net loss			(40,399)		(40,399)
Ending balance, Amount at Nov. 30, 2012	$ 169,400	$ (104,400)	$ (245,171)		$ (180,171)
Ending balance, Shares at Nov. 30, 2012	169,400,000

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GOING CONCERN

3 Months Ended

Nov. 30, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

GOING CONCERN

NOTE 3 – GOING CONCERN

The Company’s financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern. This contemplates the realization of assets and the liquidation of liabilities in the normal course of business. Currently, the Company has a working capital deficit of $180,171, an accumulated deficit of $245,171 and net loss from operations since inception of $245,171. The Company does not have a source of revenue sufficient to cover its operation costs giving substantial doubt for it to continue as a going concern. The Company will be dependent upon the raising of additional capital through placement of our common stock in order to implement its business plan, or merge with an operating company. There can be no assurance that the Company will be successful in either situation in order to continue as a going concern. The Company is funding its initial operations by way of issuing Founder’s shares.

The officers and directors have committed to advancing certain operating costs of the Company, including Legal, Audit, Transfer Agency and Edgarizing costs

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STOCK TRANSACTIONS (Details Narrative) (USD $)	Nov. 30, 2012	Aug. 28, 2012	Feb. 29, 2012	Aug. 31, 2006	Dec. 12, 2005
Notes to Financial Statements
Common stock issued as founder's shares					22,000,000
Common stock issued as founder's shares, par value					0.000455
Common stock issued to Mr. Jasmin Jayaseelan and Mr. Jefferi Jayaseelan, Shares each					8,800,000
Common stock issued to Mrs. Cheryl Lim, Shares					4,400,000
Shares issued in exchange for cash					$ 5,000
Common stock sold to investors				26,400,000
Common stock sold to investors, par value	$ 0.001		$ 0.001	$ 0.001
Common stock sold to investors, price per share				$ 0.0227
Investors who purchased common stock				32
Aggregate offering price				$ 60,000
Authorized common shares, before amendment		175,000,000
Amended authorized common shares, price per share		0.001
Additional authorized preferred shares	10,000,000	10,000,000	10,000,000
Additional authorized preferred shares, per share		$ 0.001
Authorized common shares, after amendment		800,000,000
Common stock, shares issued	169,400,000		169,400,000
Common stock, shares outstanding	169,400,000		169,400,000

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

3 Months Ended

Nov. 30, 2012

Accounting Policies [Abstract]

Basis of Accounting

Basis of Accounting

The Company’s financial statements are prepared using the accrual method of accounting. The Company has elected a February year-end.

Cash Equivalents

Cash Equivalents

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

Use of Estimates and Assumptions

Use of Estimates and Assumptions

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

Stock-Based Compensation

Stock-Based Compensation

The Company records stock-based compensation in accordance with ASC 718, Compensation – Stock Based Compensation, using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

The company has evaluated all the recent accounting pronouncements and believes that none of them will have a material effect on the company’s financial statement.