SOUTHERN USA RESOURCES INC. - FORM 10-Q

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EX-32 - SOUTHERN USA RESOURCES INC.	v165740_ex32.htm
EX-31 - SOUTHERN USA RESOURCES INC.	v165740_ex31.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the quarterly period ended: September 30, 2009

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _________ to _________

Commission file number: 333-143352

Lodestar Mining, Incorporated

(Exact name of registrant as specified in its charter)

Delaware	20-8901634
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

400 Steeprock Drive
Toronto, Ontario, Canada	M3J 2X1
(Address of principal executive offices)	(Zip code)

Registrant’s telephone number, including area code: (416) 505-1593

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§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 ¨

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	x

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

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:

Class – Common Stock, 4,010,000 shares outstanding as of October 23, 2009.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION			1

	Item 1.	Financial Statements (Unaudited)	1

	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	10

	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	14

	Item 4.	Controls and Procedures	14

PART II - OTHER INFORMATION			15

	Item 1.	Legal Proceedings	15

	Item 1A.	Risk Factors	15

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	15

	Item 3.	Defaults Upon Senior Securities.	15

	Item 4.	Submission of Matters to a Vote of Security Holders.	15

	Item 5.	Other Information.	15

	Item 6.	Exhibits	15

Signatures			17

Exhibits			18

PART I - FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS (UNAUDITED)

The accompanying unaudited financial statements of Lodestar Mining, Incorporated (“Lodestar” or the “Company”) have been prepared in accordance with generally accepted accounting principles in the United States for interim financial reporting and pursuant to the rules and regulations of the Securities and Exchange Commission ("Commission"). While these statements reflect all normal recurring adjustments which are, in the opinion of management, necessary in order to make the financial statements not misleading and for fair presentation of the results of the interim period, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. For further information, refer to the financial statements and footnotes thereto, for the fiscal year ended December 31, 2008, previously filed with the Commission, which are included in the Company's Annual Report filed on Form 10-K.

LODESTAR MINING, INCORPORATED

(AN EXPLORATION STAGE COMPANY)

INDEX TO FINANCIAL STATEMENTS

	Page(s)
Financial Statements:

Unaudited Balance Sheets as of September 30, 2009 and December 31, 2008	3

Unaudited Statements of Operations for the three and nine months ended September 30, 2009 and 2008, and the period from October 31, 2006 (Inception) through September 30, 2009	4

Unaudited Statements of Changes in Stockholders’ Equity (Deficit) for the period October 31, 2006 (Inception) through September 30, 2009	5

Unaudited Statements of Cash Flows for the nine months ended September 30, 2009 and 2008, and the period from October 31, 2006 (Inception) through September 30, 2009	6

Notes to Unaudited Financial Statements	7

LODESTAR MINING, INCORPORATED

(AN EXPLORATION STAGE COMPANY)

BALANCE SHEETS

AS OF SEPTEMBER 30, 2009 AND DECEMBER 31, 2008

(UNAUDITED)

	September 30, 2009			December 31, 2008
	(Unaudited)

ASSETS

CURRENT ASSETS
Cash	$	73		$	9,806
Total current assets		73			9,806

TOTAL ASSETS	$	73		$	9,806

LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
Mining expense payable	$	163,125		$	142,974
Accrued expense		453			4,434
Total current liabilities		163,578			147,408

TOTAL LIABILITIES		163,578			147,408

STOCKHOLDERS' DEFICIT
Preferred stock, $0.000001 par value, 20,000,000 shares authorized, none issued and outstanding		-			-
Common stock, $0.000001 par value, 1,000,000,000 shares authorized, 4,010,000 shares issued and outstanding at September 30, 2009 and and December 31, 2008, respectively		5			5
Additional paid in capital		96,594			90,105
Deficit accumulated during the exploration stage		(259,001	)		(246,569	)
Accumulated Other Comprehensive Income		(1,103	)		18,857
Total stockholders’ deficit		(163,505	)		(137,602	)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	73		$	9,806

The accompanying notes are an integral part of these unaudited financial statements.

LODESTAR MINING, INCORPORATED

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBEER 30, 2009 AND 2008, AND THE PERIOD

FROM OCTOBER 31, 2006 (INCEPTION) THROUGH SEPTEMBER 30, 2009 (UNAUDITED)

	THREE MONTHS ENDED SEPTEMBER 30,			THREE MONTHS ENDED SEPTEMBER 30,			NINE MONTHS ENDED SEPTEMBER 30,			NINE MONTHS ENDED SEPTEMBER 30,			OCTOBER 31, 2006 (INCEPTION) THROUGH SEPTEMBER 30,
	2009			2008			2009			2008			2009
REVENUE	$	-		$	-		$	-		$	-		$	-

COST OF REVENUES		-			-			-			-			-

GROSS PROFIT		-			-			-			-			-

OPERATING EXPENSES
Mining property costs		-			216,084			-			216,084			214,360
Professional fees		3,587			-			9,987			5,000			38,100
General and administrative		976			1,566			2,445			1,566			6,541
Total operating expenses		4,563			217,650			12,432			222,650			259,001

NET INCOME (LOSS)		(4,563	)		(217,650	)		(12,432	)		(222,650	)		(259,001	)

GAIN (LOSS) ON FOREIGN CURRENCY TRANSLATION		(11,774	)		6,539			(19,960	)		6,539			(1,103	)

TOTAL COMPREHENSIVE (LOSS)	$	(16,337	)	$	211,111			(32,392	)		(216,111	)	$	(260,104	)

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING		4,010,000			3,000,000			4,010,000			3,000,000			-

NET (LOSS) PER SHARE	$	( 0.00	)	$	(0.07	)	$	( 0.01	)	$	(0.07	)

The accompanying notes are an integral part of these unaudited financial statements.

LODESTAR MINING, INCORPORATED

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

FOR THE PERIOD OCTOBER 31, 2006 (INCEPTION) THROUGH SEPTEMBER 30, 2009

(UNAUDITED)

										Deficits
										Accumulated			Accumulated
					Additional					During the			Other
	Common Stock				Paid-In		Subscriptions			Exploration			Comprehensive
	Shares		Amount		Capital		Receivable			Stage			Income			Total

Balance – October 31, 2006		-	$	-	$	-	$	-		$	-		$	-		$	-

Common shares issued to founder		3,000,000		3		29,997		(30,000	)		-			-			-

Net loss for the period		-		-		-		-			-			-			-

Balance – December 31, 2006		3,000,000		3		29,997		(30,000	)		-			-			-

Cash received for subscriptions receivable		-		-		-		30,000			-			-			30,000

Contributed capital by shareholders		-		-		10,000		-			-			-			10,000

Net loss for the period		-		-		-		-			(26,289	)		-			(26,289	)

Balance – December 31, 2007		3,000,000	$	3	$	39,997		-		$	(26,289	)		-		$	13,711

Subscription Shares Issued		1,010,000		2		50,108		-			-			-			50,110

Net loss for the period		-		-		-		-			(220,280	)		-			(220,280	)

Foreign currency translation gain		-		-		-		-			-			18,857			18,857

Balance – December 31, 2008		4,010,000	$	5	$	90,105	$	-		$	(246,569	)	$	18,857		$	(137,602	)

Contributed capital by shareholders		-		-		6,489		-			-			-			6,489

Net loss for the period		-		-		-		-			(12,432	)		-			(12,432	)

Foreign currency translation gain		-		-		-		-			-			(19,960	)		(19,960	)

Balance – June 30, 2009		4,010,000	$	5	$	96,594	$	-		$	(259,001	)	$	(1,103	)	$	(163,505	)

The accompanying notes are an integral part of these unaudited financial statements.

LODESTAR MINING, INCORPORATED

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF CASH FLOW

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008, AND

THE PERIOD FROM OCTOBER 31, 2006 (INCEPTION) THROUGH SEPTEMBER 30, 2009

(UNAUDITED)

	NINE MONTHS ENDED SEPTEMBER 30,			NINE MONTHS ENDED SEPTEMBER 30,			OCTOBER 31, 2006 (INCEPTION) THROUGH SEPTEMBER 30,
	2009			2008			2009
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss)	$	(12,432	)	$	(222,650	)	$	(259,001	)
Increase (decrease) of mining payable		20,151			165,141			163,125
Increase (decrease) of stock payable		-			992			-
Increase (decrease) of accrued expenses		(3,982	)		-			452
Net cash provided by (used in ) operating activities		3,737			(56,517	)		(95,424	)

CASH FLOWS FROM FINANCING ACTIVITIES
Issuance of stock for cash and subscriptionsreceivable		-			-			80,110
Contribution of capital		6,490			49,118			16,490
Net cash provided by financing activities		6,490			49,118			96,600

EFFECTS OF FOREIGN EXCHANGE RATE		(19,960	)		6,539			(1,103	)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(9,733	)		(860	)		73

CASH AND CASH EQUIVALENTS – BEGINNING OF PERIOD		9,806			13,711			-

CASH AND CASH EQUIVALENTS – END OF PERIOD	$	73		$	12,851		$	73

The accompanying notes are an integral part of these unaudited financial statements.

NOTES TO UNAUDITED FINANCIAL STATEMENTS OF LODESTAR MINING, INCORPORATED

(An Exploration Stage Company)

NOTE 1 – ORGANIZATION AND BASIS OF PRESENTATION

The accompanying unaudited financial statements of Lodestar Mining, Incorporated. 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 Lodestar’s audited 2008 annual financial statements and notes thereto filed with the SEC on form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the result 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 required in Lodestar’s 2008 annual financial statements have been omitted.

On October 31, 2006, Lodestar Mining, Incorporated (the “Company”) was incorporated in the State of Delaware.

The Company’s principal business is the acquisition and exploration of mineral resources. The Company has not presently determined whether its mineral property under option contains mineral reserves that are economically recoverable.

Recently Adopted Accounting Pronouncements

Effective June 30, 2009, the Company adopted a new accounting standard issued by the FASB related to the disclosure requirements of the fair value of the financial instruments. This standard expands the disclosure requirements of fair value (including the methods and significant assumptions used to estimate fair value) of certain financial instruments to interim period financial statements that were previously only required to be disclosed in financial statements for annual periods. In accordance with this standard, the disclosure requirements have been applied on a prospective basis and did not have a material impact on the Company’s financial statements.

In June 2009, the Financial Accounting Standards Board ("FASB") established the FASB Accounting Standards Codification ( the "Codification") as the source of authoritative accounting principles recognized by the FASB to be applied by non-governmental entities in the preparation of financial statements in conformity with GAAP. Rules and interpretive releases of the Securities and Exchange Commission ("SEC") under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. The introduction of the Codification does not change GAAP and other than the manner in which new accounting guidance is referenced, the adoption of these changes had no impact on the our consolidated financial statements.

Recently Issued Accounting Standards

In August 2009, the FASB issued an amendment to the accounting standards related to the measurement of liabilities that are recognized or disclosed at fair value on a recurring basis. This standard clarifies how a company should measure the fair value of liabilities and that restrictions preventing the transfer of a liability should not be considered as a factor in the measurement of liabilities within the scope of this standard. This standard is effective for the Company on October 1, 2009. The Company does not expect the impact of its adoption to be material to its financial statements.

In October 2009, the FASB issued an amendment to the accounting standards related to the accounting for revenue in arrangements with multiple deliverables including how the arrangement consideration is allocated among delivered and undelivered items of the arrangement. Among the amendments, this standard eliminated the use of the residual method for allocating arrangement considerations and requires an entity to allocate the overall consideration to each deliverable based on an estimated selling price of each individual deliverable in the arrangement in the absence of having vendor-specific objective evidence or other third party evidence of fair value of the undelivered items. This standard also provides further guidance on how to determine a separate unit of accounting in a multiple-deliverable revenue arrangement and expands the disclosure requirements about the judgments made in applying the estimated selling price method and how those judgments affect the timing or amount of revenue recognition. This standard, for which the Company is currently assessing the impact, will become effective for the Company on January 1, 2011.

In October 2009, the FASB issued an amendment to the accounting standards related to certain revenue arrangements that include software elements. This standard clarifies the existing accounting guidance such that tangible products that contain both software and non-software components that function together to deliver the product’s essential functionality, shall be excluded from the scope of the software revenue recognition accounting standards. Accordingly, sales of these products may fall within the scope of other revenue recognition standards or may now be within the scope of this standard and may require an allocation of the arrangement consideration for each element of the arrangement. This standard, for which the Company is currently assessing the impact, will become effective for the Company on January 1, 2011.

NOTE 2 - GOING CONCERN

Lodestar’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities and commitments in the normal course of business for the foreseeable future. Since inception, the Company has accumulated losses aggregating to $259,001 and has insufficient working capital to meet operating needs for the next twelve months as of September 30, 2009, all of which raise substantial doubt about Lodestar’s ability to continue as a going concern.

NOTE 3 – STOCKHOLDERS EQUITY

Lodestar had 4,010,000 shares of common stock issued and outstanding as of September 30, 2009, and December 31, 2008. There were no changes, issuances, or repurchases during the period ended September 30, 2009.

NOTE 4 – MINERAL PROPERTIES

Lodestar has a Mineral Claim Option Agreement with Claim Lake Nickel, Inc. which entitles the Company to a 10% legal and beneficial interest in Claim Lake’s mineral dispositions where the company can exercise the option in accordance with the following schedule as stated in Canadian dollars (CD dollars ) in the aggregate: $5,000 as of March 27, 2007, $45,000 as of July 31, 2008, $75,000 as of September 30, 2009, and $100,000 as of September 30, 2010. As of September 30, 2009, Lodestar has paid $50,000 to Claim Lake Nickel, Inc. for mineral dispositions, and has the remaining $175,000 CD dollars recorded as a liability in its financial statements, which was translated to $163,125 US dollars as of September 30, 2009.

NOTE 5 – FOREIGN EXCHANGE

Lodestar’s financial statements have been prepared using U.S. Dollars. However, the transactions that took place in the third quarter required the use of Canadian currency. The Canadian dollars listed on the September 30, 2009 Balance Sheet were converted at the rate on September 30, 2009, which was .93 US dollar for 1 Canadian dollar. The Canadian dollars listed on the Statements of Operations for the nine months ended September 30, 2009 were converted at an average rate for the period which was .86 US dollar for 1 Canadian dollar. The net effect of the conversion resulted in a foreign currency translation loss of $19,960, which is recorded as other comprehensive loss in the statement of operations for the nine month period ended September 30, 2009.

NOTE 6 – SUBSEQUENT EVENTS

There were no subsequent events through November 9, 2009.

Item 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with our financial statements and the notes thereto which appear elsewhere in this report. The results shown herein are not necessarily indicative of the results to be expected in any future periods. This discussion contains forward-looking statements based on current expectations, which involve uncertainties. Actual results and the timing of events could differ materially from the forward-looking statements as a result of a number of factors.

Forward-Looking Statements

The following discussion and analysis is provided to increase the understanding of, and should be read in conjunction with, the Financial Statements of the Company and Notes thereto included elsewhere in this Report. Historical results and percentage relationships among any amounts in these financial statements are not necessarily indicative of trends in operating results for any future period. The statements, which are not historical facts contained in this Report, including this Plan of Operations, and Notes to the Financial Statements, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based on currently available operating, financial and competitive information, and are subject to various risks and uncertainties. Future events and the Company's actual results may differ materially from the results reflected in these forward-looking statements. Factors that might cause such a difference include, but are not limited to, dependence on existing and future key strategic and strategic end-user customers, limited ability to establish new strategic relationships, ability to sustain and manage growth, variability of operating results, the Company's expansion and development of new service lines, marketing and other business development initiatives, the commencement of new engagements, competition in the industry, general economic conditions, dependence on key personnel, the ability to attract, hire and retain personnel who possess the technical skills and experience necessary to meet the service requirements of its clients, the potential liability with respect to actions taken by its existing and past employees, risks associated with international sales, and other risks described herein and in the Company's other SEC filings. Dollar amounts are in US dollars unless otherwise stated.

Plan of Operation

We are a start-up, exploration stage corporation and have not yet generated or realized any revenues from our business operations.

Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated any revenues and no revenues are anticipated until we begin removing and selling minerals. There is no assurance we will ever reach this point. Accordingly, we must raise cash from sources other than the sale of minerals found on the property. Our only other source for cash at this time is investments by others. We must raise cash to implement our project and stay in business. We raised $50,500 from our 2008 offering. Because of our low level of activity, we believe it, together with the $30,000 received from Ian McKinnon, Chief Executive Officer and Director, for the purchase of 3,000,000 shares, will last until March, 2010.

Management recommends the following work for the Zavitz Property: on the Voyager Showing and core claims, ground checking of TDIP anomalies and spotting of the five highest priority drill targets should be carried out. Drilling should be done along strike on 100 m centers and at depth below the Voyager Showing (Quantec Zones “'D2A”'D3, “'D2B”'D3, “'D2C”'D3 and “'D2D”'D3) outlined by 1998 and 1999 geophysical surveys. The budget recommended for Phase 1 to consist of geological mapping, prospecting, lithogeochemistry, and 2,500 m of diamond drilling is $208,000. Phase II, follow- up drilling would total $239,500.

Claim Lake intends to continue to develop its property through additional surface exploration comprising geological mapping, lithogeochemistry and soil geochemistry and diamond drilling. This activity is dependent on being able to raise additional funding.

We will be conducting research in the form of exploration of the property. We are not going to buy or sell any plant or significant equipment during the next twelve months.

Our exploration target is to find an ore body containing gold. Our success depends upon finding mineralized material. This includes a determination by our consultant if the property contains reserves. We have not selected a consultant as of the date of this quarterly report. Mineralized material is a mineralized body, which has been delineated by appropriate spaced drilling or underground sampling to support sufficient tonnage and average grade of metals to justify removal. If we don't find mineralized material or we cannot remove mineralized material, either because we do not have the money to do it or because it is not economically feasible to do it, we will cease operations and you will lose your investment.

In addition, we may not have enough money to complete our exploration of the property. If it turns out that we have not raised enough money to complete our exploration program, we will try to raise additional funds from a second public offering, a private placement, or loans. At the present time, we have not made any plans to raise additional money and there is no assurance that we would be able to raise additional money in the future. If we need additional money and can't raise it, we will have to suspend or cease operations. We must conduct exploration to determine what amount of minerals, if any, exist on our properties and if any minerals that are found can be economically extracted and profitably processed.

The property is undeveloped raw land. We received $50,500 CD dollars from our offering in July, 2008. We have used all of these funds to commence exploration and surveying operations.

Before mineral retrieval can begin, we must explore for and find mineralized material. After that has occurred we have to determine if it is economically feasible to remove the mineralized material. Economically feasible means that the costs associated with the removal of the mineralized material will not exceed the price at which we can sell the mineralized material. We can't predict what that will be until we find mineralized material.

We do not know if we will find mineralized material. We believe that activities occurring on adjoining properties are not material to our activities. The reason is that whatever is located under adjoining property may or may not be located under our property.

During November 2008, work on the Zavitz property consisted of reconnaissance geological mapping, prospecting, collecting of samples for whole rock chemical analysis and a preliminary evaluation of the Fiset Gold showing. The work at the Fiset Gold showing consisted of rehabilitating and recutting of old lines, cutting of a trail to the showing, hand stripping of outcrop, drilling and blasting of a trench, sampling and assaying of grab samples from the trench. A report on the work and results is available from Claim Lake Nickel Inc.

A portion of the proceeds from the offering that closed in 2008 were used to fund the costs of the initial exploration program recommended by Ulrich Kretschmar. The cost of the work program was approximately $15,000, which was comprised of $1,000 for mobilization and demobilization, $4,760 for trenching, $2,700 for supervision, $1,000 for meals and lodging, $990 for truck & ATV expense, $2,700 for shipping and assays, and $1,850 for taxes.

If we are unable to complete any phase of exploration because we don't have enough money, we will cease operations until we raise more money. If we can't or don't raise more money, we will cease operations. We do not intend to hire additional employees at this time. All of the work on the property will be conducted by unaffiliated independent contractors that we will hire. The independent contractors will be responsible for surveying, geology, engineering, exploration, and excavation. The geologists will evaluate the information derived from the exploration and excavation and the engineers will advise us on the economic feasibility of removing the mineralized material.

As part of Lodestar’s plan to augment its financial resources and consider attractive business opportunities, Lodestar’s principal stockholders have entered into discussions with an unnamed, unaffiliated third party with respect to a potential merger transaction which could result in the discontinuance of our current operations, change of control/ownership and new management. There can be no assurance that a merger or other significant transaction will be consummated with the third party, or if consummated, that Lodestar or its stockholders would realize any benefits from it.

Limited Operating History; Need for Additional Capital

There is no historical financial information about us upon which to base an evaluation of our performance. We are an exploration stage corporation and have not generated any revenues from operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, possible delays in the exploration of our properties, and possible cost overruns due to price and cost increases in services.

To become profitable and competitive, we must conduct the research and exploration of our properties before we start production of any minerals we may find. We are seeking equity financing to provide for the capital required to implement our research and exploration phases. Because of our limited operations, we believe that the funds raised from the offering that closed in July, 2008 will allow us to operate until March, 2010.

We have no assurance that future financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. Equity financing could result in additional dilution to existing shareholders.

Results of Operations

For the nine month period ending September 30, 2009, as compared to the nine month period ending September 30, 2008, there were no revenues as this company is in the exploration stage.

For the nine month period ending September 30, 2009, there were professional fees of $9,987 and general and administrative expenses of $2,445. For the nine month period ending September 30, 2008, we had professional fees of $5,000, and general and administrative expenses of $1,566. Professional fees for the nine month period ending September 30, 2009 increased by 99% from the same period during 2008. The professional fees are incurred as costs of the company to file periodic reports with the SEC and will be consistent over the next twelve months. The general and administrative expenses are corporate records expenses and will also be consistent over the next twelve months.

Liquidity and Capital Resources

To meet our need for cash we closed an equity offering and raised $50,500 CD dollars. We cannot guarantee that these funds will be sufficient to stay in business. If we find mineralized material and it is economically feasible to remove the mineralized material, we will attempt to raise additional money through a subsequent private placement, public offering or through loans. If the funds we raised are insufficient to complete our exploration of the property, we will have to find alternative sources, like a second public offering, a private placement of securities, or loans from our officers or others.

Since inception, we have accumulated losses aggregating $259,001. Accordingly, we have insufficient funds for us to implement our business plan.

At the present time, we have not made any arrangements to raise additional cash other than through the offering that was registered with the SEC in March, 2008 and funded in July, 2008. If we need additional cash and can't raise it we will either have to suspend operations until we do raise the cash, or cease operations entirely. The funds raised in the March, 2008 registration offering will allow the company to operate until March, 2010. Other than as described in this paragraph, we have no other financing plans.

Lodestar executed an extension agreement dated March 12, 2009 with Claim Lake Nickel wherein Claim Lake agreed to extend the term for the second payment to March 13, 2010.

Since inception we have issued 3,000,000 shares of common stock pursuant to the exemption from registration set forth in section 4(2) of the Securities Act of 1933. On November 15, 2006, the corporation issued 3,000,000 shares of restricted common stock to Ian McKinnon, Chief Executive Officer of Lodestar Mining, Incorporated, that Rule 144 of the Securities Act of 1933 defines as restricted securities. The shares were issued in consideration for payment of $30,000 from Ian McKinnon. These shares will be restricted by the resale limitations of Rule 144 under the Securities Act of 1933.

As of September 30, 2009, our total assets were $73 and our total liabilities were $163,578.

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 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

Item 4.

CONTROLS AND PROCEDURES

We carried out an evaluation under the supervision and with the participation of our management, including the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), of the effectiveness of our disclosure controls and procedures as of September 30, 2009. Based on that evaluation, the CEO and CFO have concluded that our disclosure controls and procedures are not effective to provide reasonable assurance that: (i) information required to be disclosed by us in reports that we file or submit under the Securities Exchange Act of 1934 is accumulated and communicated to our management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure by us; and (ii) information required to be disclosed by us in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.

As of September 30, 2009, we did not maintain effective controls over our financial statement disclosure. Specifically, controls were not designed and in place to ensure that all disclosures required are addressed in our financial statements. In addition, we lack sufficient accounting staff and the performance of the principal accounting functions are by one officer. Our chief executive officer also serves as our chief financial officer. All of our financial reporting is carried out by one individual, and we do not have an audit committee. This lack of accounting staff results in a lack of segregation of duties and accounting technical expertise necessary for an effective system of internal control. Accordingly, management has determined that this control deficiency constitutes a material weakness.

During the quarter ended September 30, 2009, there were no changes in the Company's internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1.

LEGAL PROCEEDINGS

None

Item 1A.

RISK FACTORS

Not applicable.

Item 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None

Item 3.

DEFAULTS UPON SENIOR SECURITIES

None

Item 4.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

Item 5.

OTHER INFORMATION

None

Item 6.

EXHIBITS

Exhibits required by Item 601 of Regulation S-K

	Exhibit 3.1		Articles of Incorporation (incorporated by reference to Exhibit 3.1 of the Form SB-2 of Lodestar Mining, Incorporated, filed on May 30, 2007, File No. 333-143352)

	Exhibit 3.2		Bylaws (incorporated by reference to Exhibit 3.2 in the Form SB-2 of Lodestar Mining, Incorporated, filed on May 30, 2007, File No. 333-143352)

	Exhibit 10.1		Mineral Claim Option Agreement with Claim Lake Nickel, Inc. (incorporated by reference to Exhibit 10.1 in the Form SB-2 of Lodestar Mining, Incorporated, filed on May 30, 2007, File No. 333-143352)

	Exhibit 10.2		Amendment No. 1 to the Mineral Claim Option Agreement (incorporated by reference to Exhibit 10.2 in the Form 10-K of Lodestar Mining, Incorporated, filed on April 15, 2009, File No. 333-143352).

	Exhibit 10.3		Amendment No. 2 to the Mineral Claim Option Agreement (incorporated by reference to Exhibit 10.3 in the Form 10-K of Lodestar Mining, Incorporated, filed on April 15, 2009, File No. 333-143352).

	Exhibit 31		Certification as Adopted Pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002 by Chief Executive Officer and Chief Financial Officer

	Exhibit 32		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 by Chief Executive Officer and Chief Financial Officer

SIGNATURES

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

	LODESTAR MINING, INCORPORATED
	(Registrant)

Date: November 10, 2009	/s/ Ian McKinnon
	Ian McKinnon, Chief Executive Officer, Director, Principal Executive Officer, Principal Financial Officer, Principal Accounting Officer, Treasurer

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SOUTHERN USA RESOURCES INC. Reports