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AGIN > SEC Filings for AGIN > Form 10-Q on 13-Feb-2014All Recent SEC Filings

Show all filings for AMERICAN GRAPHITE TECHNOLOGIES INC. | Request a Trial to NEW EDGAR Online Pro

Form 10-Q for AMERICAN GRAPHITE TECHNOLOGIES INC.


13-Feb-2014

Quarterly Report


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

This current report contains forward-looking statements relating to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "intends", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential", or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors which may cause our or our industry's actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or performance. You should not place undue reliance on these statements, which speak only as of the date that they were made. These cautionary statements should be considered with any written or oral forward-looking statements that we may issue in the future. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results, later events or circumstances or to reflect the occurrence of unanticipated events.

In this report unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to "common shares" refer to the common shares of our capital stock.

The management's discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP").

The following discussion of our financial condition and results of operations should be read in conjunction with our audited financial statements for the year ended June 30, 2013, along with the accompanying notes. As used in this quarterly report, the terms "we", "us", "our", and the "Company" means American Graphite Technologies Inc.

Liquidity & Capital Resources

We are an exploration stage company engaged in the exploration of mineral properties and the development of related technologies. To date, we have not generated any revenues.

Cash on hand at December 31, 2013 was $257,832 as compared to $116,588 as of June 30, 2013. We had a total of $261,762 in prepaid expenses on December 31, 2013 as compared to $170,000 in prepaid expenses as at June 30, 2013. Prepaid expenses relate to the $260,000 paid against the licensing agreement with Cheap Tubes and prepaid expenses for general and administration costs in the amount of $1,762.

Our total current liabilities at December 31, 2013 were $14,292 as compared to $8,806 as at June 30, 2013. The total long term liabilities at December 31, 2013 were $1,213,456 as compared to $Nil at June 30, 2013. This significant change is solely related to a derivative warrant liability which occurred as a result of operating funds received from a units private placement undertaken during the six months ended December 31, 2013, whereby the Company raised $600,000 to fund operations. The private placement required the issuance of warrants, which are accounted for as a derivative liability. We currently have mineral claims which potentially could have graphite deposits and two projects related to graphene or products related to graphene.

During our six month period ended December 31, 2013 and the fiscal year ended June 30, 2013, the Company was successful in raising the required funding for operations by way of private placements. During the period ended December 31, 2013 the Company completed a private placement in the amount of $600,000 (net $533,000) which the Company believes will be sufficient to meet its ongoing expenditures through to the fiscal year ended June 30, 2014. The Company has obligations in excess of the funds raised if it wishes to fund the $120,000 that is required for exploration of its mineral claims and should there be additional cash requirements for the Cheap Tubes project and the development of the 3-D project. At this time, the additional cash requirements for the Cheap Tubes project and the 3-D projects cannot be estimated. Operating costs for the Company over the next twelve months for general and administrative expenses, including contractual expenses and fees for legal, accounting, audit and filing fees are estimated to be approximately $200,000. Including the $200,000 for operating expenses and the $120,000 for exploration expenses estimated for the next twelve months, the Company as at December 31, 2013 had a short fall of approximately $62,000.


The Company believes it will need to raise an additional $250,000 for operations to ensure it can fund obligations on all of its projects. While there are warrants outstanding pursuant to prior financings undertaken by the Company, there can be no assurance that the Company will raise any funds from warrant exercises and the Company currently has no other financing agreements under which it can raise funding. The Company intends to seek additional equity financings and loans to fund the expected shortfall in funding but there can be no assurance that such funding will be available and if available it will be on favorable terms. You may face substantial dilution in your share holdings on any ongoing financings which the Company may negotiate. Should the Company not be able to raise additional funding it may not be able to fund the exploration of its mineral claims or it may have to delay or terminate its ongoing technology development. At this time, the Company cannot state with certainty that it will be able to raise sufficient funding to continue with all of its intended projects.

Results of Operations

We do not have any revenues and have not had any revenue since inception on June 1, 2010.

Three Month Period Ended December 31, 2013 Compared to Three Month Period Ended December 31, 2012

Losses remained relatively constant period over period with a net loss of $124,512 for the three months ended December 31, 2013 as compared to a net loss of $115,683 for three months ended December 31, 2012 due to an offset of $32,898 during the three months ended December 31, 2013 related to the change in the valuation of warrant liabilities which offset operating expenses of $157,410 during the three months ended December 31, 2013 as compared to operating expenses of $115,583 during the three months ended December 31, 2012. Therefore, while we had no significant increases in net losses, the Company had a significant increase in operating losses of $41,827. The increase for the three month period ended December 31, 2013 is related to an expenditure for research and development in the amount of $44,832, with no comparable expenditure for the three months ended December 31, 2012. Office and general increased to $39,072 from $17,913 (2012) due to increased fees related to reporting requirements as the Company created derivative warrant liability reporting with its financing agreements, management fees increased to $25,400 (2013) from $12,500 (2012) , consulting fees increased to $32,318 (2013) from $28,468 (2012) and professional fees increased to $15,788 (2013) from $10,002 (2012) as the Company continued to increase activities related to operations, including financing activities. The losses were offset by a decrease in stock based compensation to $Nil for the three months ended December 31, 2013 as compared to an expense of $46,800 during the three months ended December 31, 2012.

Basic and diluted losses per share for the respective three month periods ended December 31, 2013 and December 31, 2012was ($0.00).

Six Month Period ended December 31, 2013 Compared to Six Month Period Ended December 31, 2012

We have a net loss of $317,480 for the six months ended December 31, 2013 as compared to a net loss of $254,141for six months ended December 31, 2012 and operating losses of $347,479 for the six months ended December 31, 2013 as compared to operating losses of $253,375 for the six months ended December 31, 2012. Net loss for the six months ended December 31, 2013 was offset by the valuation of the change in the fair value of the warrant liability with no comparable offset during the six months ended December 31, 2012. The substantial increase in operating losses of $94,104 was mainly related to increase activities related to operations, including financing activities. Research and development expenses for the six months ended December 31, 2013 were $44,832, with no comparable expense during the six months ended December 31, 2012. office and general increased to $83,511 from $35,833 (2012) due to increased fees related to reporting requirements as the Company created derivative warrant liability reporting with its financing agreements, management fees increased to $47,900 (2013) from $12,500 (2012) due to a contractual increase in fees, consulting fees increased to $99,326 (2013) from $94,683
(2012) and professional fees increased to $29,910 (2013) from $24,859 (2012) as the Company continued to increase activities related to operations, including financing activities. The 2013 losses reflected a decrease in stock based compensation to $42,000 for the six months ended December 31, 2013 as compared to $78,000 during the six months ended December 31, 2012.


From inception we have had a net loss of $959,324 and an operating loss of $988,446 .

Basic and diluted losses per share for the respective six month periods ended December 31, 2013 and December 31, 2012 was ($0.00).

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