UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
| [X] | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED December 31 2013 |
Commission file number 000-54665
WESTERN GRAPHITE INC.
(Exact name of registrant as specified in its charter)
Nevada
(State or other jurisdiction of incorporation or organization)
Hudson Bay Centre
2 Bloor Street East, Suite 3500
Toronto, Ontario M4W 1A8
(Address of principal executive offices, including zip code.)
416 915 1661
(Telephone number, including area code)
Lauren Notar
Hudson Bay Centre, 2 Bloor Street East, Suite 3500
Toronto, Ontario M4W 1A8
(Name and Address of Agent for Service)
4100 W. Flamingo Road, Suite 2750, Las Vegas, NV 89103
(Former Address of principal executive offices, including zip code.)
Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the last 90 days. YES [X] NO [ ]
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§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 [ X ] NO [ ]
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," "non-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 [X] |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES [ ] NO [X]
State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 71,666,667 shares as of December 31 2013
ITEM 1. FINANCIAL STATEMENTS
GEORGE STEWART, CPA
316 17TH AVENUE SOUTH
SEATTLE, WASHINGTON 98144
(206) 328-8554 FAX(206) 328-0383
To the Board of Directors
Western Graphite Inc
I have audited the accompanying balance sheets of Western Graphite Inc (An Exploration Stage Company) as of December 31, 2013 and 2012, and the related statements of operations, stockholders' equity and cash flows for the years ended December 31, 2013 and 2012 and for the period from December 15, 2006 (inception), to December 31, 2013. These financial statements are the responsibility of the Company’s management. My responsibility is to express an opinion on these financial statements based on my audit.
I conducted my audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Western Graphite Inc, (An Exploration Stage Company) as of December 31, 2013 and 2012, and the results of its operations and cash flows for the years ended December 31, 2013 and 2012 and the period from December 15, 2006 (inception), to December 31, 2013 in conformity with generally accepted accounting principles in the United States of America.
The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note # 2 to the financial statements, the Company has had no operations and has no established source of revenue. This raises substantial doubt about its ability to continue as a going concern. Management’s plan in regard to these matters is also described in Note # 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ George Stewart
Seattle, Washington
March 13, 2014
2
WESTERN GRAPHITE INC.
(An Exploration Stage Company)
Balance Sheets
| ASSETS | |||||
|
|
| As of |
|
| As of |
|
|
| December 31 |
|
| December 31 |
|
|
| 2013 |
|
| 2012 |
|
|
|
|
|
|
|
| Current Assets |
|
|
|
|
|
| Cash | $ | 27,781 |
| $ | 73 |
| Deposit |
| 1,209 |
|
| 3,937 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Current Assets |
| 28,990 |
|
| 4,010 |
|
|
|
|
|
|
|
| Fixed Assets |
|
|
|
|
|
| Mining Properties |
| 1,513,000 |
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Fixed Assets |
| 1,513,000 |
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Assets | $ | 1,541,990 |
| $ | 4,010 |
|
|
|
|
|
|
|
| LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT) | |||||
|
|
|
|
|
|
|
| Current Liabilities |
|
|
|
|
|
| Accounts Payable | $ | 116 |
| $ | 60 |
| Loan Payable - Related Party |
| 37,325 |
|
| 31,325 |
| Accrued Interest |
| 7,819 |
|
| - |
| Note Payable |
| 150,000 |
|
| - |
| Property Payments Due |
| 1,500,000 |
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Current Liabilities |
| 1,695,260 |
|
| 31,385 |
|
|
|
|
|
|
|
| Total Liabilities |
| 1,695,260 |
|
| 31,385 |
|
|
|
|
|
|
|
| Stockholders' Equity (Deficit) |
|
|
|
|
|
| Common stock, ($0.001 par value, 750,000,000 shares |
|
|
|
|
|
| authorized; 71,666,667 shares and 58,000,000 shares issued and |
|
|
|
|
|
| outstanding as of June 30, 2013 and December 31, 2012 respectively) |
| 71,667 |
|
| 58,000 |
| Additional paid-in capital |
| 120,333 |
|
| 16,000 |
| Deficit accumulated during exploration stage |
| (345,270) |
|
| (101,375) |
|
|
|
|
|
|
|
|
|
| (153,270) |
|
| (27,375) |
|
|
|
|
|
|
|
| TOTAL LIABILITIES & |
|
|
|
|
|
| STOCKHOLDERS' EQUITY (DEFICIT) | $ | 1,541,990 |
| $ | 4,010 |
See Accompanying Notes and Accountant's Report
3
WESTERN GRAPHITE INC.
(An Exploration Stage Company)
Statements of Operations
|
|
|
|
|
|
|
|
| December 15, 2006 |
|
|
|
|
|
|
|
|
| (inception) |
|
|
| Year Ended |
|
| Year Ended |
|
| through |
|
|
| December 31 |
|
| December 31 |
|
| December 31 |
|
|
| 2013 |
|
| 2012 |
|
| 2013 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenues | $ | - |
| $ | - |
| $ | - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total Revenues |
| - |
|
| - |
|
| - |
|
|
|
|
|
|
|
|
|
|
| Operating Costs |
|
|
|
|
|
|
|
|
| Mineral Property Expenditures |
| 10,711 |
|
| - |
|
| 27,039 |
| Administrative Expenses |
| 207,348 |
|
| 20,669 |
|
| 245,867 |
| Professional Fees |
| 18,017 |
|
| 9,463 |
|
| 64,545 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net Operating Loss |
| 236,076 |
|
| 30,132 |
|
| 337,451 |
|
|
|
|
|
|
|
|
|
|
| Other Expenses |
|
|
|
|
|
|
|
|
| Interest Expense |
| 7,819 |
|
|
|
|
| 7,819 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net Loss | $ | (243,895) |
| $ | (30,132) |
| $ | (345,270) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic earnings (loss) per share | $ | (0.00) |
| $ | 0.01 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted average number of |
|
|
|
|
|
|
|
|
| common shares outstanding |
| 71,666,667 |
|
| 5,800,000 |
|
|
|
See Accompanying Notes and Accountant's Report
4
WESTERN GRAPHITE INC.
(An Exploration Stage Company)
Statements of Cash Flows (Unaudited)
|
|
|
|
|
|
|
|
| December 15, 2006 |
|
|
| Twelve Months |
|
| Twelve Months |
|
| (inception) |
|
|
| Ended |
|
| Ended |
|
| through |
|
|
| Dec 31, |
|
| Dec 31, |
|
| December 31, |
|
|
| 2013 |
|
| 2012 |
|
| 2013 |
| CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
| Net income (loss) | $ | (243,895) |
| $ | (30,132) |
| $ | (345,270) |
| Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
| (Increase) decrease in Deposit |
| 2,728 |
|
| 463 |
|
| (1,209) |
| Increase (Decrease) in Accounts Payable and Accrued Liabilities |
| 7,875 |
|
| (1,600) |
|
| 7,935 |
|
|
|
|
|
|
|
|
|
|
| Net cash provided by (used in) operating activities |
| (233,292) |
|
| (31,269) |
|
| (338,544) |
|
|
|
|
|
|
|
|
|
|
| CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net cash provided by (used in) investing activities |
| - |
|
| - |
|
| - |
|
|
|
|
|
|
|
|
|
|
| CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Note Payable |
| 150,000 |
|
| - |
|
| 150,000 |
| Loan Payable - Related Party |
| 6,000 |
|
| 31,325 |
|
| 37,325 |
| Issuance of common stock |
| 105,000 |
|
| - |
|
| 179,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net cash provided by (used in) financing activities |
| 261,000 |
|
| 31,325 |
|
| 366,325 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net increase (decrease) in cash |
| 27,708 |
|
| 56 |
|
| 27,781 |
|
|
|
|
|
|
|
|
|
|
| Cash at beginning of period |
| 73 |
|
| 17 |
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cash at end of period | $ | 27,781 |
| $ | 73 |
| $ | 27,781 |
|
|
|
|
|
|
|
|
|
|
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION |
|
|
|
|
|
|
|
|
| Cash paid during year for : |
|
|
|
|
|
|
|
|
| Interest | $ | - |
| $ | - |
| $ | - |
| Income Taxes | $ | - |
| $ | - |
| $ | - |
|
|
|
|
|
|
|
|
|
|
| NON CASH TRANSACTIONS |
|
|
|
|
|
|
|
|
| Increase (Decrease) in Property Payments Due |
| 1,500,000 |
|
|
|
|
| 1,500,000 |
| Acquisition of Mining Properties |
| (1,513,000) |
|
|
|
|
| (1,513,000) |
| Issuance of Common Stock |
| 13,000 |
|
|
|
|
| 13,000 |
See Accompanying Notes and Accountant's Report
5
WESTERN GRAPHITE INC.
(An Exploration Stage Company)
Statements of Changes in Stockholders' Equity
From December 15, 2006 (Inception) through December 31, 2013
|
|
|
|
|
|
|
| Deficit |
|
|
|
|
|
|
|
|
|
| Accumulated |
|
|
|
|
|
| Common |
| Additional |
| During |
|
|
|
| Common |
| Stock |
| Paid-In |
| Exploration |
|
|
|
| Stock |
| Amount |
| Capital |
| Stage |
| Total |
| BALANCE, DECEMBER 15, 2006 | - |
| - |
| - |
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Stock issued for cash on December 15, 2006 |
|
|
|
|
|
|
|
|
|
| @ $0.005 per share | 2,000,000 |
| 2,000 |
| 8,000 |
|
|
| 10,000 |
|
|
|
|
|
|
|
|
|
|
|
| Net loss, December 31 2006 |
|
|
|
|
|
| (590) |
| (590) |
|
|
|
|
|
|
|
|
|
|
|
| BALANCE, DECEMBER 31, 2006 | 2,000,000 |
| 2,000 |
| 8,000 |
| (590) |
| 9,410 |
|
|
|
|
|
|
|
|
|
|
|
| Stock issued for cash on February 23, 2007 |
|
|
|
|
|
|
|
|
|
| @ $0.005 per share | 800,000 |
| 800 |
| 3,200 |
|
|
| 4,000 |
|
|
|
|
|
|
|
|
|
|
|
| Stock issued for cash on April 5, 2007 |
|
|
|
|
|
|
|
|
|
| @ $0.02 per share | 3,000,000 |
| 3,000 |
| 57,000 |
|
|
| 60,000 |
|
|
|
|
|
|
|
|
|
|
|
| Net loss, December 31, 2007 |
|
|
|
|
|
| (19,635) |
| (19,635) |
|
|
|
|
|
|
|
|
|
|
|
| BALANCE, DECEMBER 31, 2007 | 5,800,000 |
| 5,800 |
| 68,200 |
| (20,225) |
| 53,775 |
|
|
|
|
|
|
|
|
|
|
|
| Net Loss, December 31, 2008 |
|
|
|
|
|
| (18,350) |
| (18,350) |
|
|
|
|
|
|
|
|
|
|
|
| BALANCE, DECEMBER 31, 2008 | 5,800,000 |
| 5,800 |
| 68,200 |
| (38,575) |
| 35,425 |
|
|
|
|
|
|
|
|
|
|
|
| Net loss, December 31, 2009 |
|
|
|
|
|
| (10,025) |
| (10,025) |
|
|
|
|
|
|
|
|
|
|
|
| BALANCE, DECEMBER 31, 2009 | 5,800,000 |
| 5,800 |
| 68,200 |
| (48,600) |
| 25,400 |
|
|
|
|
|
|
|
|
|
|
|
| Net loss, December 31, 2010 |
|
|
|
|
|
| (11,373) |
| (11,373) |
|
|
|
|
|
|
|
|
|
|
|
| BALANCE, DECEMBER 31, 2010 | 5,800,000 |
| 5,800 |
| 68,200 |
| (59,973) |
| 14,027 |
|
|
|
|
|
|
|
|
|
|
|
| Net loss, December 31, 2011 |
|
|
|
|
|
| (11,270) |
| (11,270) |
|
|
|
|
|
|
|
|
|
|
|
| BALANCE, DECEMBER 31, 2011 | 5,800,000 |
| 5,800 |
| 68,200 |
| (71,243) |
| 2,757 |
|
|
|
|
|
|
|
|
|
|
|
| Net loss December 31, 2012 |
|
|
|
|
|
| (30,132) |
| (30,132) |
|
|
|
|
|
|
|
|
|
|
|
| BALANCE, DECEMBER 31, 2012 | 5,800,000 |
| 5,800 |
| 68,200 |
| (101,375) |
| (27,375) |
|
|
|
|
|
|
|
|
|
|
|
| 10 for 1 Forward Split on February 27, 2013 | 52,200,000 |
| 52,200 |
| (52,200) |
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
| Stock issued on February 27, 2013 |
|
|
|
|
|
|
|
|
|
| @ $0.001 per share | 3,000,000 |
| 3,000 |
|
|
|
|
| 3,000 |
| Stock issued on March 4, 2013 |
|
|
|
|
|
|
|
|
|
| @ $0.001 per share | 10,000,000 |
| 10,000 |
|
|
|
|
| 10,000 |
| Stock issued on October 18, 2013 |
|
|
|
|
|
|
|
|
|
| @ $0.16 per share | 500,000 |
| 500 |
| 79,500 |
|
|
| 80,000 |
| Stock issued on November 25, 2013 |
|
|
|
|
|
|
|
|
|
| @ $0.15 per share | 166,667 |
| 167 |
| 24,833 |
|
|
| 25,000 |
| Net loss December 31, 2013 |
|
|
|
|
|
| (243,895) |
| (243,895) |
|
|
|
|
|
|
|
|
|
|
|
| BALANCE, DECEMBER 31, 2013 | 71,666,667 |
| 71,667 |
| 120,333 |
| (345,270) |
| (153,270) |
See Accompanying Notes and Accountant's Report
6
WESTERN GRAPHITE INC.
(An Exploration Stage Company)
Notes to Financial Statements
December 31, 2013
NOTE 1. BASIS OF PRESENTATION
The accompany unaudited interim financial statements of Western Graphite Inc. (f/k/a Lucky Strike Explorations Inc.) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with the audited financial statements and notes thereto contained in Lucky Strike’s Form 10-K filed with SEC. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial statements which would substantially duplicate the disclosure contained in the audited financial statements for fiscal 2012 as reported in the Form 10-K have been omitted.
NOTE 2. GOING CONCERN
As of December 31, 2013 Western Graphite has no generated revenues and has accumulated losses since inception. The continuation of Western Graphite as a going concern is dependent upon the continued financial support from its shareholders, its ability to obtain necessary equity financing to continue operations, and the attainment of profitable operations. These factors raise substantial doubt regarding Western Graphite’s ability to continue as a going concern.
NOTE 3. NOTE PAYABLE RELATED PARTY
As of December 31, 2013 $37,325 is owed to an ex-officer and director of the Company and is non-interest bearing with no specific repayment terms.
NOTE 4. NOTES PAYABLE
Note payable as of December 31 2013 is:
Unsecured promissory note payable, dated May 10 2013 bearing interest at 10% per annum. $50,000. Interest expense incurred under this debt obligation amounted to $2,538 and $0 for the twelve months ended December 31, 2013 and 2012 respectively. Accrued interest was $2,538 and $0 as of December 31, 2013 and 2012 respectively.
Unsecured promissory note payable, for $100,000 dated July 18, 2013 bearing interest at 10% per annum. Interest expense incurred under this debt obligation amounted to $4,582 and $0 for the twelve months ended December 31, 2013 and 2012 respectively. Accrued interest was $4,582 and $0 as of December 31, 2013 and 2012 respectively.
Total accrued interest was $7,819 and $0 as of December 31, 2013 and 2012 respectively.
NOTE 5. ACQUISITION OF MINES
On February 27, 2013, the Company acquired all the rights, title and interest in certain lands covering approximately 495 hectares and known as the Amorf Graphite property a d located in the district of Bozyazi, in the village of Cabukkoyaoi, Mersin Province, Turkey. The Company acquired the property pursuant to an agreement with Dr. Ahment Unsai in exchange for 3,000,000 (three million) shares of the Company’s restricted common stock along with 2 future payments totalling $1,500,000.
7
On March 4, 2013, the Company entered into an agreement of purchase and sale with Seyit Kucuk for the acquisition of five (5) claims located in the Omineca Mining Division of the Province of British Columbia. The claims, which cover approximately 2,524 hectares, are known as the Pure Flake Graphite property and are subject to a 2% net milling royalty. In consideration for the acquisition of these claims, the company issued 10,000,000 (ten million) shares of the company’s restricted common stock. The Company has determined that the fair market value of the shares issued by the Company for the property acquisitions cannot be reliably determined and therefore it has deemed it appropriate to value the shares issued based on the fair market value of the securities in the underlying transaction. The Company has further determined that the period end price of its common stock as quoted at www.otcbb.com cannot be used to determine fair market value as the stock had never traded. Furthermore, as the Company has not issued any shares for cash in the past 2 years it has determined that a reasonable value at the time for the shares being issued is $.001, the par value of the common stock.
NOTE 6. STOCK TRANSACTIONS
Transactions, other than employee’s stock issuance, are in accordance with ASC No. 505. Thus issuances shall be accounted for based on the fair value of the consideration received. Transactions with employee’s stock issuance are in accordance with ASC No. 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 15, 2006, the Company issued a total of 2,000,000 shares of common stock to Michael Noble for cash in the amount of $0.005 per share for a total of $10,000.
On February 23, 2007, the Company issued a total of 800,000 shares of common stock to Michael Noble for cash in the amount of $0.005 per share for the total of $4,000.
On April 5, 2007, the Company issued a total of 3,000,000 shares of common stock from its registered SB-2 offering to 27 shareholders at $0.02 per share for a total of $60,000.
On February 27, 2013 the Company effected a 10 for 1 forward split of its issued and outstanding share capital such that everyone’s share of common stock issued and outstanding prior to the split was exchanged for ten post-split shares of common stock. The number of shares referred to in the previous paragraphs is post-split number of shares. The Company’s post-split authorized capital has increased to 750,000,000 shares of common stock with a par value of $0.001 per share. All share amounts have been retroactively adjusted for all periods presented.
On February 27, 2013 the Company issued a total of 3,000,000 shares of common stock to one individual as part of the payment for the acquisition of the Amorf Graphite property valued at $0.001 per share for a total of $3,000. On March 4, 2013 the Graphite property valued at $0.001 per share for a total of $10,000.
On June 19, 2013 in a private transaction, Lauren Notar purchased 14,000,000 shares of common stock held by Michael Noble, a former officer and director, for $2,000 or $0.000143 per share.
On July 1, 2013, the company issued a total of 250,000 shares of common stock to Harry Bygdnes as compensation as a member of the Western Graphite Board.
On July 31, 2013, the company issued a total of 250,000 shares of common stock to Alex Burton as compensation for becoming an Advisor to the company and for joining the company as Vice President of Exploration.
On November 25 2013, the company issued a total of 166,667 shares of common stock to Noram Ventures Inc. as partial payment towards the Western Graphite/Noram Ventures potential Joint Venture agreement.
As of December 31 2013 the Company had 71,666,667 shares of common stock issued and outstanding.
NOTE 7. STOCKHOLDERS EQUITY
The stockholders equity section of the Company contains the following classes of capital stock as of December 31, 2013: Common Stock, $0.001 par value: shares issued and outstanding: 750,000,000.
8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
Forward Looking Statements
This report contains forward-looking statements that involve risk and uncertainties. We use words such as “anticipate”, “believe”, “plan”, “expect”, “future”, “intend”, and similar expressions to identify such forward-looking statements. Investors should be aware that all forward-looking statements contained within this report are good faith estimates of management as of the date of this report and actual results may differ materially from historical results or our predictions of future results.
Results of Operations
We are still in our exploration stage and have generated no revenues to date. Our net loss from inception (December 15, 2006) through September 30, 2013 was $179,909.76
We incurred operating expenses of $36,670.07 for the three months ended September 30, 2013. These expenses consisted of general operating expenses and professional fees incurred in connection with the day to day operation of our business and the preparation and filing of our required reports with the U.S. Securities and Exchange Commission. Operating expenses for the same period ending September 30, 2012 were $2,096.
We incurred operating expenses of $77,796 for the nine months ended September 30, 2013. These expenses consisted of general operating expenses and professional fees incurred in connection with the day to day operation of our business and the preparation and filing of our required reports with the U.S. Securities and Exchange Commission. Operating expenses for the same period ending September 30, 2012 were $25,609.
We have sold $74,000 in equity securities since inception, $14,000 from the sale of 2,800,000 shares of stock to our officer and director and $60,000 from the sale of 3,000,000 shares registered pursuant to our SB-2 Registration Statement which became effective on March 12, 2007.
On February 27, 2013 the Company affected a 10 for 1 forward split of its issued and outstanding share capital such that every one share of common stock issued and outstanding prior to the split was exchanged for ten post-split shares of common stock. The number of shares referred to in the previous paragraphs is post-split number of shares. The Company’s post-split authorized capital has increased to 750,000,000 shares of common stock with a par value of $0.001 per share. All share amounts have been retroactively adjusted for all periods presented.
On February 27, 2013 the Company issued a total of 3,000,000 shares of common stock to one individual as part of the payment for the acquisition of the Amorf Graphite property valued at $.001 per share for a total of $3,000.
On March 4, 2013 the Company issued a total of 10,000,000 shares of common stock to one individual as payment for the acquisition of the Pure Flake Graphite property valued at $.001 per share for a total of $10,000.
On June 19, 2013, in a private transaction, Lauren Notar purchased the 14,000,000 shares of common stock held by Michael Noble, a former officer and director, for $2,000 or $.000143 per share.
On July 1, 2013, the company issued a total of 250,000 shares of common stock to Harry Bygdnes as compensation as a member of the Western Graphite Board.
On July 31, 2013, the company issued a total of 250,000 shares of common stock to Alex Burton as compensation for becoming an Advisor to the company and for joining the company as Vice President of Exploration.
On November 25 2013, the company issued a total of 166,667 shares of common stock to Noram Ventures Inc. as partial payment towards the Western Graphite/Noram Ventures Joint Venture Agreement.
In October 2013, Western Graphite entered into a funding arrangement with Erik Williams of IBK Capital Corp. in Toronto Ontario. Western Graphite also entered into an agreement with a New York firm that is working closely with Western Graphite on funding and building Western Graphite.
9
The following table provides selected financial data about our company for the quarter ended September 30, 2013.
| Balance Sheet Data: | 12/31.2013 |
Cash | $27,781 |
| Total assets | $1,541,990 |
Total liabilities | $1,695,260 |
| Shareholders' equity | $4,010 |
Liquidity and Capital Resources
Our cash in the bank at Dec 31 2013 was $27,781 with $1,695,260 in outstanding liabilities. Management does not believe our current cash is sufficient to fund our operations over the next twelve months.
Plan of Operation
On October 21, 2013, Western Graphite and Noram Ventures, report that, further to the news release of August 15, 2013, the terms and conditions of the Letter of Intent regarding the Kokanee flake graphite property have been extended until November 29, 2013.
August 2013, Western Graphite signed a Letter of Intent with Noram Ventures Inc. (NRM on the TSX:V exchange) to enter into a sub option and joint venture agreement on the Kokanee flake graphite property located approximately 31 miles northeast of the city of Nelson in the Slocan Mining Division of British Columbia.
Subject to Western Graphite and Noram Ventures completing their respective due diligence and receiving board and regulatory approvals, the Parties will complete each of the following earn-in stages:
Grant of Earn-in Option:
Noram has an exclusive option to earn a 100% interest in the Property and will grant to Western a sub-option (the "Earn-in Option") to earn a 50% interest in the Property. In order to exercise the Earn-in Option and acquire a 50% interest in the Property, Western will be required to complete each of the following earn-in stages (each, an "Earn-in Stage"):
a. Pay to Noram, on or before the 5th business day following receipt of the TSX Venture Exchange approval, the sum of $75,000 payable through the issuance of such number of common shares of Western (the "Western Shares") at a deemed price per Western Share to be mutually agreed upon by the Parties;
b. Fund all costs associated with metallurgical testing on the Property 2012 drill core and surface samples to be completed by SGS Lakefield;
c. Fund the next phase of resource definition drilling to be completed on the Property, and the sample analysis and metallurgical work to be carried out by SGS Lakefield in connection therewith;
d. Fund the preparation of a National Instrument 43-101 compliant resource estimate and technical report in respect of the Property, to be completed by a geological consultant who is independent of the Parties; and
e. Upon completion of the last of the Earn-in Stages set forth in paragraphs (a) through (d) above, pay to Noram the sum of $30,000 as a reimbursement of one-half of the cash payments made by Noram under the Option Agreement between Noram and Bruce Doyle dated June 8, 2012 (the "Kokanee Option Agreement").
10
Formation of Joint Venture:
Upon completion of all of the Earn-in Stages and provided that Noram has been vested with a 100% right, title and interest in and to the Property pursuant to the terms of the Kokanee Option Agreement, Western will:
a. be deemed to have exercised the Earn-in Option and to have earned a 50% right, title and interest in and to the Property; and
b. form a joint venture with Noram pursuant to the terms of a 50/50 joint venture agreement to be entered into at the relevant time. Such joint venture agreement will provide that the cost of all future exploration expenditures to be undertaken on the Property will be borne equally by the Parties.
In the event that this LOI is not superseded by the Agreement on or before October 21, 2013, or such other date the Parties may agree to, the LOI will terminate.
August 14, 2013, Western Graphite welcomed Alex Burton as Vice President of Exploration and his appointment to our Advisory Board. Alex is a geologist and is licensed as both a Professional Engineer and Professional Geologist with over 50 years of experience in mining exploration, development, and consulting. Alex brings to Western Graphite his years of work experience including mine development and production; management positions for Noranda, Copper Range Exploration Co. Inc., Phelps Dodge Corporation of Canada Ltd., and starting a large parastatal exploration company for the country of Zambia.
Alex has extensive experience setting up major exploration programs and in bringing metallic and industrial deposits to production. Western Graphite looks forward to Alex bringing this experience and expertise to the development of the Western Graphite properties.
Our plan of operation over the next 12 months is to begin operations on the Amorf Graphite property and the Pure Flake property.
Western Graphite has hired Paul Gray, principal of PDGGC to manage and conduct a Phase 1 project reconnaissance; rock sampling and compilation work on our Pure Flake Mineral Claim Group in the Slocan Mining District in British Columbia, to begin the spring of 2013.
Off-Balance Sheet Arrangements
We do not have any 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 investors.
ITEM 4. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our principal executive officer and the principal financial officer, we have conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as of the end of the period covered by this report. Based on this evaluation, our principal executive officer and principal financial officer concluded as of the evaluation date that our disclosure controls and procedures were effective such that the material information required to be included in our Securities and Exchange Commission reports is accumulated and communicated to our management, including our principal executive and financial officer, recorded, processed, summarized and reported within the time periods specified in SEC rules and forms relating to our company, particularly during the period when this report was being prepared.
11
Changes in Internal Controls Over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during the last fiscal quarter ended September 30, 2013 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
ITEM 5. OTHER INFORMATION
Effective July 8, 2013, Seyit Kucuk resigned as President, Chief Executive Officer and Director of our company. Mr. Kucuk’s resignation was not the result of any disagreements with our company regarding our operations, policies, practices or otherwise.
Concurrently with the resignation of Seyit Kucuk, we appointed Lauren Notar as President and Chief Executive Officer. Ms. Notar also acts as Treasurer, Chief Financial Officer, Secretary and Director of our company. We also appointed Harry Bygdnes as a Director of our company to fill the ensuing vacancy, effective July 1, 2013.
On July 8, 2013, we agreed to provide Mr. Bygdnes with monthly compensation of $2,000 and will issue to him 100,000 shares of our common stock.
Harry Bygdnes - Director 73
Mr. Bygdnes graduated from the University of British Columbia in 1967 with a Bachelor of Science degree in physics and mathematics.
Upon completion of his formal education Mr. Bygdnes joined Texaco Canada in Calgary Alberta where he held the position of Assistant to the Chief Geophysicist for Canada. In his role as Geophysicist his responsibilities included acquisition and interpretation of seismic data, mapping and joint recommendations for well site locations in conjunction with company geological personnel, and field supervision of seismic crew operations as company representative.
Mr.Bygdnes left Texaco in 1971 and joined a small Calgary firm called Explor-Alta to become Field Supervisor of Arctic marine operations in summer and Operation Manager for land seismic operations in winter. Explor-Alta was able to provide important seismic data for companies such as Texaco, Exxon and Gulf Oil.
In 1973, Mr. Bygdnes left Explor-Alta to set up his own private company specializing in acquisition and computer processing of seismic data. In 1980 Mr. Bygdnes moved to Vancouver to form a small public company called Consort Energy Corp. The company originally participated in small joint venture oil well drilling operations in Texas, Oklahoma and Kansas. When the oil business faltered in the early nineteen-eighties Mr. Bygdnes turned the attention of the company to mineral exploration and conducted an extensive joint venture drilling program with major mining company adjacent to the Echo Bay Lupin Goldmine in the NWT.
In 1988, Mr. Bygdnes and a partner purchased the rights to a patented ice replacement product from an inventor in San Diego. The previous exploration programs had limited results so Mr. Bygdnes consolidated the company and formed Cryopak Industries Inc. Mr. Bygdnes acted as President, and Chief Executive Officer of Cryopak for 12 years at which time he retired to the position of Chairman of the Board bringing his considerable expertise into the company. During this time with the company, Mr. Bygdnes was able to raise in excess of CDN$12,000,000 largely through European investors. The company having sales in excess of $14,000,000 annually.
In 2002, Mr. Bygdnes and a partner formed B&K Productions Inc., a production company focused on entering into the television-programming field. B&K Productions produced three episodes of the TV show “Hook Line and Supper” a show that combines fishing with gourmet cooking. Mr. Bygdnes participated as host of the show as well as producer. Bygdnes introduced the show at the MIPTV festival in Cannes France in 2003. Although the show received much interest it has not sold at present.
Mr. Bygdnes presently holds the position of President of County Line Energy Corp., a start-up over-the-counter trading US company seeking opportunity in the resource sector. Mr. Bygdnes presently consults to several junior companies in the resource field.
12
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS.
The following exhibits are included with this quarterly filing:
| Exhibit No. | Description |
|
|
|
3.1 | Articles of Incorporation* |
| 3.2 | Bylaws* |
31.1 | Sec. 302 Certification of Principal Executive Officer |
| 31.2 | Sec. 302 Certification of Principal Financial Officer |
32.1 | Sec. 906 Certification of Principal Executive Officer |
| 32.2 | Sec. 906 Certification of Principal Financial Officer |
101 | Interactive data files pursuant to Rule 405 of Regulation S-T |
*Document is incorporated by reference and can be found in its entirety in our Registration Statement on Form SB-2, SEC File Number 333-140839, at the Securities and Exchange Commission website at www.sec.gov.
13
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe it meets all of the requirements for filing Form 10-K and authorized this report to be signed on its behalf by the undersigned, in the city of Toronto, province of Ontario on March 14, 2014.
Western Graphite Inc.
/s/ Lauren Notar
By: Lauren Notar
(Principal Executive Officer)
In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following person in the capacities and date stated.
| /s/ Lauren Notar |
| March 14, 2014 |
| Lauren Notar, President, Secretary, Treasurer & Director |
| Date |
| (Principal Executive Officer Principal Financial Officer & Principal Accounting Officer) |
|
|
|
|
| |
|
|
|
|
| /s/ Harry Bygdnes |
| March 14, 2014 |
| Harry Bygdnes, Director |
| Date |
14
Exhibit 31.1
Certification of Chief Executive Officer
I, Lauren Notar, certify that:
1. I have reviewed this Annual Report on Form 10-K of Western 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 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 our 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 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 controls 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.
IN WITNESS WHEREOF, the undersigned has executed this certification as of the 31st day of March, 2014.
/s/ Lauren Notar
Chief Executive Officer
Exhibit 31.2
Certification of Chief Financial Officer
I, Lauren Notar, certify that:
1. I have reviewed this Annual Report on Form 10-K of Western 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 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 our 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 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 controls 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.
IN WITNESS WHEREOF, the undersigned has executed this certification as of the 31st day of March, 2014.
/s/ Lauren Notar
Chief Financial Officer
Exhibit 32.1
CERTIFICATION
Pursuant to 18 U.S.C. 1350
(Section 906 of the Sarbanes-Oxley Act of 2002)
In connection with the Annual Report on Form 10-K of Western Graphite Inc. (the “Company”) for the year ended December 31, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Lauren Notar, as Chief Executive Officer of the Company, hereby certifies, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
|
| (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 results of operations of the Company. |
| Date: March 31, 2014 |
| By: /s/ Lauren Notar |
|
|
| Lauren Notar |
|
|
| Chief Executive Officer |
|
|
|
|
This certification accompanies each Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of §18 of the Securities Exchange Act of 1934, as amended.
A signed original of this written statement required by Section 906 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.
Exhibit 32.2
CERTIFICATION
Pursuant to 18 U.S.C. 1350
(Section 906 of the Sarbanes-Oxley Act of 2002)
In connection with the Annual Report on Form 10-K of Western Graphite, Inc.. (the “Company”) for the year ended December 31, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Lauren Notar, as Chief Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
|
| (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 results of operations of the Company. |
| Date: March 31, 2014 |
| By: /s/ Lauren Notar |
|
|
| Lauren Notar |
|
|
| Chief Financial Officer |
This certification accompanies each Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of §18 of the Securities Exchange Act of 1934, as amended.
A signed original of this written statement required by Section 906 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.
|
Note Payable Related Party
|
12 Months Ended |
|---|---|
|
Dec. 31, 2013
|
|
| Notes | |
| Note Payable Related Party | Note 3. Note Payable Related Party As of December 31, 2013, $37,325 is owed to an ex-officer and director of the Company and is non-interest bearing with no specific repayment terms. |