SECURITIES
AND EXCHANGE COMMISSION

Washington,
D.C. 20549

FORM
10-Q



(Mark
One)



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



For
the quarterly period ended March 31, 2012



OR



| | £ | TRANSITION
                                                                                                         REPORT PURSUANT TO SECTION
                                                                                                         13 OR 15(d) OF THE SECURITIES
                                                                                                         EXCHANGE ACT OF 1934
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



For
the transition period from                     to



Commission
file number             000-54533



USG1,
INC.

(Exact
name of registrant as specified in its charter)



|Delaware                        |  | 27-2288541         
|------------------------------- |  | -------------------
|(State or other jurisdiction of |  | (I.R.S. Employer   
|incorporation or organization)  |  | Identification No.)



1126
Madison 9517, Fredericktown, Missouri 63645

(Address
of principal executive offices) (zip code)



573-561-4283

(Registrant's
telephone number, including area code)



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 S
    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 companyS
| | (do not check if a smaller reporting company)



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



YesSNo £



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



|Class                                | Outstanding at
|------------------------------------ | --------------
|                                     | May 14, 2012  
|                                     |               
|Common Stock, par value $0.0001      | 6,600,000     
|                                     |               
|Documents incorporated by reference: | None          











PART
I — FINANCIAL INFORMATION

ITEM
1. FINANCIAL STATEMENTS.



USG1, INC.

INDEX TO UNAUDITED FINANCIAL STATEMENTS

MARCH 31, 2012



|                                        | Page
|--------------------------------------- | ----
|                                        |     
|Unaudited Financial Statements:         |     
|                                        |     
|Balance Sheets                          | F-1 
|                                        |     
|Statements of Operations                | F-2 
|                                        |     
|Statements of Cash Flows                | F-3 
|                                        |     
|Notes to Unaudited Financial Statements | F-4 











USG1, INC.

(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEETS



|                                                                                                        |  | March 31,   |         |   | December 31, |  
|------------------------------------------------------------------------------------------------------- |  | ----------- | ------- | - | ------------ | -
|                                                                                                        |  | 2012        |         |   | 2011         |  
|                                                                                                        |  | (Unaudited) |         |   | (Audited)    |  
|Assets                                                                                                  |  |             |         |   |              |  
|                                                                                                        |  |             |         |   |              |  
|Current Assets                                                                                          |  |             |         |   |              |  
|Cash and cash equivalents                                                                               |  | $           | 621     |   |              | $
|Total Current Assets                                                                                    |  |             | 621     |   |              |  
|                                                                                                        |  |             |         |   |              |  
|Total Assets                                                                                            |  | $           | 621     |   |              | $
|                                                                                                        |  |             |         |   |              |  
|Liabilities and Stockholders' Deficit                                                                   |  |             |         |   |              |  
|                                                                                                        |  |             |         |   |              |  
|Current Liabilities                                                                                     |  |             |         |   |              |  
|Accrued interest - related party                                                                        |  | $           | 23      |   |              | $
|Accrued expenses                                                                                        |  |             | 1,500   |   |              |  
|Note payable - related party                                                                            |  |             | 2,500   |   |              |  
|Total Current Liabilities                                                                               |  |             | 4,023   |   |              |  
|                                                                                                        |  |             |         |   |              |  
|Stockholders' Deficit                                                                                   |  |             |         |   |              |  
|Preferred stock - $.0001 par value; 20,000,000 shares authorized, 0 shares issued and outstanding       |  |             | -       |   |              |  
|Common stock - $.0001 par value; 100,000,000 shares authorized, 6,600,000 shares issued and outstanding |  |             | 660     |   |              |  
|Additional paid-in capital                                                                              |  |             | 30,083  |   |              |  
|Accumulated deficit                                                                                     |  |             | (34,145 | ) |              |  
|Total Stockholders' Deficit                                                                             |  |             | (3,402  | ) |              |  
|                                                                                                        |  |             |         |   |              |  
|Total Liabilities and Stockholders' Deficit                                                             |  | $           | 621     |   |              | $



The accompanying notes are an integral part
of financial statements.



F-1







USG1, INC.

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF OPERATIONS

(UNAUDITED)



|                                                       |  |                            |           |   |                     |   |           | For The Period From | 
|------------------------------------------------------ |  | -------------------------- | --------- | - | ------------------- | - | --------- | ------------------- | 
|                                                       |  | For The Three Months Ended |           |   | February 27, 2010   |  
|                                                       |  | March 31,                  |           |   | (Inception) through |  
|                                                       |  | 2012                       |           |   | 2011                |   |           | March 31, 2012      | 
|                                                       |  |                            |           |   |                     |   |           |                     | 
|Net Revenue                                            |  | $                          | -         |   |                     | $ | -         |                     | 
|                                                       |  |                            |           |   |                     |   |           |                     | 
|General and Administrative Expenses                    |  |                            |           |   |                     |   |           |                     | 
|Legal and professional expenses                        |  |                            | 1,500     |   |                     |   | -         |                     | 
|Office supplies                                        |  |                            | -         |   |                     |   | -         |                     | 
|Bank service fees                                      |  |                            | -         |   |                     |   | -         |                     | 
|Total general and administrative expenses              |  |                            | 1,500     |   |                     |   | -         |                     | 
|                                                       |  |                            |           |   |                     |   |           |                     | 
|Operating loss                                         |  |                            | (1,500    | ) |                     |   | -         |                     | 
|                                                       |  |                            |           |   |                     |   |           |                     | 
|Interest expense                                       |  |                            | (2        | ) |                     |   | (3        | )                   | 
|                                                       |  |                            |           |   |                     |   |           |                     | 
|Net Loss before Income Taxes                           |  |                            | (1,502    | ) |                     |   | (3        | )                   | 
|                                                       |  |                            |           |   |                     |   |           |                     | 
|Income Tax Expense                                     |  |                            | -         |   |                     |   | -         |                     | 
|                                                       |  |                            |           |   |                     |   |           |                     | 
|Net Loss                                               |  | $                          | (1,502    | ) |                     | $ | (3        | )                   | 
|                                                       |  |                            |           |   |                     |   |           |                     | 
|Loss per common share - basic and diluted              |  | $                          | -         |   |                     | $ | -         |                     | 
|Weighted average shares outstanding, basic and diluted |  |                            | 6,600,000 |   |                     |   | 6,600,000 |                     | 



The accompanying notes are an integral part
of financial statements.



F-2





USG1, INC.

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CASH FLOWS

(UNAUDITED)



|                                                                                |  |                            |        |   |                     |   |    | For The Period From | 
|------------------------------------------------------------------------------- |  | -------------------------- | ------ | - | ------------------- | - | -- | ------------------- | 
|                                                                                |  | For The Three Months Ended |        |   | February 27, 2010   |  
|                                                                                |  | March 31,                  |        |   | (Inception) through |  
|                                                                                |  | 2012                       |        |   | 2011                |   |    | March 31, 2012      | 
|CASH FLOWS FROM OPERATING ACTIVITIES                                            |  |                            |        |   |                     |   |    |                     | 
|Net loss                                                                        |  | $                          | (1,502 | ) |                     | $ | (3 | )                   | 
|Shares issued for legal and consulting services                                 |  |                            | -      |   |                     |   | -  |                     | 
|Adjustments to reconcile net loss to net cash provided by operating activities: |  |                            |        |   |                     |   |    |                     | 
|Increase in accrued interest                                                    |  |                            | 2      |   |                     |   | 3  |                     | 
|(Decrease) Increase in accrued expenses                                         |  |                            | (1,000 | ) |                     |   | -  |                     | 
|Net cash used in operating activities                                           |  |                            | (2,500 | ) |                     |   | -  |                     | 
|                                                                                |  |                            |        |   |                     |   |    |                     | 
|CASH FLOWS FROM FINANCING ACTIVITIES                                            |  |                            |        |   |                     |   |    |                     | 
|Proceeds from issuance of common stocks                                         |  |                            | -      |   |                     |   | -  |                     | 
|Proceeds from loans from related party                                          |  |                            | -      |   |                     |   | -  |                     | 
|Proceeds from capital contributions                                             |  |                            | 3,100  |   |                     |   | -  |                     | 
|Net cash provided by financing activities                                       |  |                            | 3,100  |   |                     |   | -  |                     | 
|                                                                                |  |                            |        |   |                     |   |    |                     | 
|NET INCREASE IN CASH & CASH EQUIVALENTS                                         |  |                            | 600    |   |                     |   | -  |                     | 
|CASH & CASH EQUIVALENTS, BEGINNING BALANCE                                      |  |                            | 21     |   |                     |   | 67 |                     | 
|CASH & CASH EQUIVALENTS, ENDING BALANCE                                         |  | $                          | 621    |   |                     | $ | 67 |                     | 
|                                                                                |  |                            |        |   |                     |   |    |                     | 
|SUPPLEMENTAL DISCLOSURES:                                                       |  |                            |        |   |                     |   |    |                     | 
|Interest paid                                                                   |  | $                          | -      |   |                     | $ | -  |                     | 
|Income taxes paid                                                               |  | $                          | -      |   |                     | $ | -  |                     | 



The accompanying notes are an integral part
of financial statements.



F-3







USG1, INC.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

(UNAUDITED)



NOTE 1: ORGANIZATION



USG1, Inc. (“the Company”)
was incorporated under the laws of the State of Delaware, U.S. on February 27, 2010.  The Company intends to engage in any
lawful corporate undertaking, including, but not limited to, selected mergers and acquisitions. The Company will attempt to locate
and negotiate with a business entity for the combination of that target company with it. The combination will normally take the
form of a merger, stock-for-stock exchange or stock-for-assets exchange. In most instances the target company will wish to structure
the business combination to be within the definition of a tax-free reorganization under Section 351 or Section 368 of the Internal
Revenue Code of 1986, as amended.



No assurances can be given that USG1 will
be successful in locating or negotiating with any target company.



The proposed business activities described
herein classify USG1 as a “blank check” company. The Securities and Exchange Commission and certain states have enacted
statuettes, rules and regulations limiting the public sale of securities of blank check companies. USG1 will not make any efforts
to cause a market to develop in its securities until such time as it has successfully implemented its business plan and is no longer
classified as a blank check company.



Development Stage Risk



The Company has not earned revenues from
operations. Accordingly, the Company’s activities have been accounted for as those of a “Development Stage Enterprise”
as set forth in Accounting Standards Codification (“ASC”) 915 “Development Stage Entities”, which was previously
Statement of Financial Accounting Standards No. 7 (“SFAS 7”). Among the disclosures required by ASC 915 are that the
Company’s financial statements be identified as those of a development stage company, and that the statements of operations,
stockholders’ equity and cash flows disclose activity since the date of the Company’s inception. For the period from
February 27, 2010 (inception) through March 31, 2012, the Company has accumulated losses of $34,145.



Since its inception, the Company has been
dependent upon the receipt of capital investment to fund its continuing activities. In addition to the normal risks associated
with a new business venture, there can be no assurance that the Company’s business plan will be successfully executed. Our
ability to execute our business plan will depend on our ability to obtain additional financing and achieve a profitable level of
operations. There can be no assurance that sufficient financing will be obtained. Further, we cannot give any assurance that we
will generate substantial revenues or that our business operations will prove to be profitable.



NOTE 2: GOING CONCERN



The Company’s financial statements
are prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which
contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not
yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern.
The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating
losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.
The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue
as a going concern.



F-4







USG1, INC.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

(UNAUDITED)



Management’s Plan to Continue
as a Going Concern



In order to continue as a going concern,
the Company will need, among other things, additional capital resources. Management’s plans to obtain such resources for
the Company include (1) obtaining capital from the sale of its securities, and (2) short-term borrowings from shareholders or related
party when needed. However, management cannot provide any assurance that the Company will be successful in accomplishing any of
its plans.



The ability of the Company to continue
as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and
eventually secure other sources of financing and attain profitable operations.



NOTE 3: SUMMARY OF ACCOUNTING POLICIES



Interim Financial Statements:

The unaudited
financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles for interim
financial information. Accordingly, they do not include all the information and footnotes
required by accounting principles generally accepted in the United States of America for annual audited financial statements. However,
the information included in these interim financial statements reflects all adjustments (consisting solely of normal recurring
adjustments) which are, in the opinion of management, necessary for the fair presentation of the financial position and the results
of operations of the Company. Results shown for interim periods are not necessarily indicative of the results to be obtained for
a full year. These interim financial statements should be read in conjunction with the Company’s audited financial statements
as of December 31, 2011 and related notes included therein.



Basis of Presentation:

The accompanying financial statements have
been prepared by the Company. The Company’s financial statements are prepared in accordance with generally accepted accounting
principles in the United States of America (“US GAAP”).



Fiscal Year:

The Company’s fiscal year end is
December 31.



Cash and Cash Equivalents:

Cash and cash equivalents include cash
and all highly liquid instruments with original maturities of three months or less.



Use of Estimates:

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



F-5







USG1, INC.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

(UNAUDITED)



Share Based Payments:

In December, 2004, the FASB issued SFAS
No. 123(R), “Share-Based Payment”, which replaces SFAS No. 123 and supersedes APB Opinion No. 25. SFAS No. 123(R) is
now included in ASC 718 “Compensation – Stock Compensation”. Under SFAS No. 123(R), companies are required to
measure the compensation costs of share-based compensation arrangements based on the grant-date fair value and recognize the costs
in the financial statements over the period during which employees or independent contractors are required to provide services.
Share-based compensation arrangements include stock options and warrants, restricted share plans, performance-based awards, share
appreciation rights and employee share purchase plans. In March, 2005, the SEC issued Staff Accounting Bulletin No. 107 (“SAB
107”) which expresses views of the staff regarding the interaction between SFAS No. 123(R) and certain SEC rules and regulations
and provides the staff’s views regarding the valuation of share-based payment arrangements for public companies. SFAS No.
123(R) permits public companies to adopt its requirements using one of two methods. On April 14, 2005, the SEC adopted a new rule
amending the compliance dates for SFAS No. 123(R). Companies may elect to apply this statement either prospectively, or on a modified
version of retrospective application under which financial statements for prior periods are adjusted on a basis consistent with
the pro forma disclosures required for those periods under SFAS No. 123. To date, the Company has not adopted a stock option plan
nor granted any stock options.



Advertising Costs:

The Company expenses all advertising costs
in the current period. The results of future benefits from advertising are minimal based upon the type of advertising involved.
To date, the Company has not incurred any advertising expenses.



Income Taxes:

Income taxes are accounted for under the
assets and liabilities method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable
to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases
and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect
for the year in which those temporary differences are expected to be recovered or settled.



Net Loss per Common Share:

Basic net loss per share is calculated
by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share
reflects the potential dilution of securities by including common stock equivalents, such as stock options, stock warrants and
convertible preferred stock, in the weighted average number of common shares outstanding for a period, if dilutive. For the three
months ended March 31, 2012 and 2011, there were no potentially dilutive securities.



Recently Issued Accounting Pronouncements:

The Company has adopted all recently issued
accounting pronouncements. The adoption of the accounting pronouncements, including those not yet effective, is not anticipated
to have a material effect on the financial position or results of operations of the Company.



F-6







USG1, INC.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

(UNAUDITED)



NOTE 4: STOCKHOLDERS’ EQUITY



The Company is authorized to issue a total
of 120,000,000 shares of stock consisting of 100,000,000 shares of Common Stock with par value of $.0001 per share and 20,000,000
shares of Preferred Stock, par value of $.0001.



On February 27, 2010 (inception), the Company
issued 6,350,000 shares of common stock to 43 individual shareholders at an average price of $.00317 per share for cash in the
amount of $20,100. On the same date, the Company issued 250,000 shares of common stock as payment for legal and consulting services
at $.00317 per share for a total value of $793.



NOTE 5: RELATED PARTY TRANSACTIONS



The parties primarily refer to the shareholders
and officers of the Company and corporate entities related to the Company through common ownership.



Note Payable



Note payable to officer amounted to $2,500
as of March 31, 2012 and December 31, 2011, respectively. The loan was borrowed from the President and Chairman of the Company
on July 6, 2010 for short-term with written agreement, unsecured, and bearing an interest of 0.43% per annum. Unpaid interests
accrued associated with the note amounted to $23 and $21 as of March 31, 2012 and December 31, 2011, respectively.



NOTE 6: SUBSEQUENT EVENTS



In accordance with FASB Accounting Standards
Codification Topic 855, “Subsequent Events”, the Company has evaluated subsequent events through the date of this filing.
All subsequent events requiring recognition as of March 31, 2012, have been incorporated into these financial statements and there
are no subsequent events that require disclosure.





F-7











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



FORWARD-LOOKING
STATEMENTS



This
Quarterly Report on Form 10-Q, including "Management's Discussion and Analysis of Financial Condition and Results of Operations"
in Item 2 of Part I of this report include forward-looking statements. These forward looking statements are based on our management’s
current expectations and beliefs and involve numerous risks and uncertainties that could cause actual results to differ materially
from expectations. In some cases, you can identify forward-looking statements by terminology such as "may," "should,"
"expects," "plans," "anticipates," "believes," "estimates," "predicts,"
"potential," "proposed," "intended," or "continue" or the negative of these terms or other
comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about
our future operating results or our future financial condition or state other "forward-looking" information. Many factors
could cause our actual results to differ materially from those projected in these forward-looking statements, including but not
limited to: variability of our revenues and financial performance; risks associated with product development and technological
changes; the acceptance our products in the marketplace by existing and potential future customers; general economic conditions.
You should be aware that the occurrence of any of the events described in this Quarterly Report could substantially harm our business,
results of operations and financial condition, and that upon the occurrence of any of these events, the trading price of our securities
could decline. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot
guarantee future results, growth rates, levels of activity, performance or achievements. We are under no duty to update any of
the forward-looking statements after the date of this Quarterly Report to conform these statements to actual results.











INTRODUCTION



The
following Management’s Discussion and Analysis (“MD&A”) is intended to help the reader understand the results
of operations and financial condition of USG1, Inc (“USG1”). MD&A is provided as a supplement to, and should be
read in conjunction with, our financial statements and the accompanying notes to the financial statements. As used in this Quarterly
Report, the terms "we", "us", "our", “Registrant”, and “the Company” mean
USG1.



The
Company was incorporated in the State of Delaware on February 27, 2010.



NATURE
OF BUSINESS



USG1,
Inc. ("USG1" or the "Company") was incorporated on February 27, 2010 under the laws of the State of Delaware
to engage in any lawful corporate undertaking, including, but not limited to, selected mergers and acquisitions. USG1 has been
in the developmental stage since inception and its operations to date have been limited to issuing shares to its original shareholders
and filing a registration statement. USG1 has been formed to provide a method for a foreign or domestic private company to become
a reporting company with a class of securities registered under the Securities Exchange Act of 1934.



The
Company registered its common stock on a Form 10 registration statement filed pursuant to the Securities Exchange Act of 1934
(the "Exchange Act") and Rule 12(g) thereof. The Company files with the Securities and Exchange Commission periodic
and current reports under Rule 13(a) of the Exchange Act, including quarterly reports on Form 10-Q and annual reports Form 10-K.



The
Company has no employees and one officer, who is also the sole director.



USG1
intends to help a company become a public reporting company. In the event USG1 is successful in a business combination, our advisors
may recommend that the company file a registration statement; most likely on Form S-1, or alternatively that a company first effect
a business combination with USG1 and then subsequently file a registration statement. A company may choose to effect a business
combination with USG1 before filing a registration statement as such method may be an effective way to obtain exposure to the
brokerage community.



A
combination will normally take the form of a merger, stock-for-stock exchange or stock-for-assets exchange. In most instances
the target company will wish to structure the business combination to be within the definition of a tax-free reorganization under
Section 351 or Section 368 of the Internal Revenue Code of 1986, as amended.



As
of March 31, 2012, USG1 had not generated revenues and had no income or cash flows from operations since inception. The continuation
of USG1 as a going concern is dependent upon financial support from its stockholders, its ability to obtain necessary equity financing
to continue operations, to successfully locate and negotiate with a business entity for the combination of that target company
with USG1. There is no assurance that USG1 will ever be profitable.











RESULTS
OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2012 AND 2011



The
Company has received no income and has incurred operating expenses for general corporate upkeep and accounting fees. Operations
will likely remain similar until USG1 transacts a business combination. Since there is minimal cash on hand, the Company will
be reliant on the additional capital from existing shareholders or will need to issue more shares to continue as a going concern.



LIQUIDITY
AND CAPITAL RESOURCES



As
of March 31, 2012, we had working capital deficit of $3,402. Operating expenses during the three months ended March 31, 2012 totaled
$1,500 compared to $0 for the three months ended March 31, 2011. The increase resulted primarily from professional fees incurred
related to our public company filing obligations.



Net
cash provided by financing activities during the three months ended March 31, 2012 was $3,100, mainly due to additional paid-in
capital contributed by our major shareholder, Ms. Kimi Royer, who is also the Chairman and Chief Executive Officer of the Company.



No
shares were sold during the three months ended March 31, 2012.



We
have not yet recognized revenues from our operations. As a result, our current cash position is not sufficient to fund our cash
requirements during the next twelve months, including operations and capital expenditures.



Current
assets were mainly cash of $621 as of March 31, 2012. We will be reliant upon additional paid-in capital from shareholder, shareholder
loans, private placements or public offerings of equity to fund our operations. We have secured no sources of loans. We had negative
cash flow from operations and no revenues during the three months ended March 31, 2012.



OFF-BALANCE
SHEET ARRANGEMENTS



There
are no 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.



INFLATION



We
do not believe our business and operations have been materially affected by inflation.



CRITICAL
ACCOUNTING POLICIES AND ESTIMATES



Our
critical accounting policies are as follows:











Use
of Estimates



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



Share
Based Payments



In
December, 2004, the FASB issued SFAS No. 123(R), “Share-Based Payment”, which replaces SFAS No. 123 and supersedes
APB Opinion No. 25. SFAS No. 123(R) is now included in ASC 718 “Compensation – Stock Compensation”. Under SFAS
No. 123(R), companies are required to measure the compensation costs of share-based compensation arrangements based on the grant-date
fair value and recognize the costs in the financial statements over the period during which employees or independent contractors
are required to provide services. Share-based compensation arrangements include stock options and warrants, restricted share plans,
performance-based awards, share appreciation rights and employee share purchase plans. In March, 2005, the SEC issued Staff Accounting
Bulletin No. 107 (“SAB 107”) which expresses views of the staff regarding the interaction between SFAS No. 123(R)
and certain SEC rules and regulations and provides the staff’s views regarding the valuation of share-based payment arrangements
for public companies. SFAS No. 123(R) permits public companies to adopt its requirements using one of two methods. On April 14,
2005, the SEC adopted a new rule amending the compliance dates for SFAS No. 123(R). Companies may elect to apply this statement
either prospectively, or on a modified version of retrospective application under which financial statements for prior periods
are adjusted on a basis consistent with the pro forma disclosures required for those periods under SFAS No. 123. To date, the
Company has not adopted a stock option plan nor granted any stock options.



Income
Taxes



Income
taxes are accounted for under the assets and liabilities method. Deferred tax assets and liabilities are recognized for the estimated
future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities
and their respective tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured
using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.



Recently
Issued Accounting Pronouncements



The
Company has adopted all recently issued accounting pronouncements. The adoption of the accounting pronouncements, including those
not yet effective, is not anticipated to have a material effect on the financial position or results of operations of the Company.











| | ITEM 3. | QUANTATIVIE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
| | ------- | ----------------------------------------------------------



Information
not required to be filed by Smaller reporting companies.



| | ITEM 4. | CONTROLS
AND PROCEDURES.
| | ------- | ------------------------



Disclosures
and Procedures



Pursuant
to Rules adopted by the Securities and Exchange Commission, the Company carried out an evaluation of the effectiveness of the
design and operation of its disclosure controls and procedures pursuant to Exchange Act Rules. This evaluation was done as of
the end of the period covered by this report under the supervision and with the participation of the Company's principal executive
officer (who is also the principal financial officer).



Based
upon that evaluation, she believes that the Company's disclosure controls and procedures are effective in gathering, analyzing
and disclosing information needed to ensure that the information required to be disclosed by the Company in its periodic reports
is recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms. Disclosure
controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be
disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer's management,
including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to
allow timely decisions regarding required disclosure.



This
Quarterly Report does not include an attestation report of the Company's registered public accounting firm regarding internal
control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting
firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management's
report in this Quarterly Report.



Changes
in Internal Controls



There
were no changes in the Company's internal control over financial reporting that was identified in connection with such evaluation
that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect,
the Company's internal control over financial reporting.



PART
II — OTHER INFORMATION



| | ITEM 1. | LEGAL
PROCEEDINGS.
| | ------- | ------------------



There
are no legal proceedings against the Company and the Company is unaware of such proceedings contemplated against it.



| | ITEM 1A. | RISK
FACTORS.
| | -------- | -------------



As
a “smaller reporting company”, we are not required to provide disclosure under this Item 1A.











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



On
February 27, 2010 (inception), the Company issued 6,350,000 shares of common stock to 43 individual shareholders at an average
price of $.00317 per share for cash in the amount of $20,100. On the same date, the Company issued 250,000 shares of common stock
as payment for legal and consulting services at $.00317 per share for a total value of $793.



The
proceeds of these sales have been used to cover operating, legal, and professional fees since inception.



| | ITEM 3. | DEFAULTS
UPON SENIOR SECURITIES.
| | ------- | --------------------------------



None.



| | ITEM 4. | SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS.
| | ------- | ----------------------------------------------------



None.



| | ITEM 5. | OTHER
INFORMATION.
| | ------- | ------------------



| | (a) | Not
                                                              applicable.
| | --- | -----------------------------------------------------------------------------

| | (b) | Item
                                                              407(c)(3) of Regulation S-K:
| | --- | -----------------------------------------------------------------------------------------------



During
the quarter covered by this Report, there have not been any material changes to the procedures by which security holders may recommend
nominees to the Board of Directors.



| | ITEM 6. | EXHIBITS
| | ------- | --------



| | (a) | Exhibits
| | --- | --------



| | 31 | Certification
                                                               of the Chief Executive Officer and Chief Financial Officer pursuant
                                                               to Section 302 of the Sarbanes-Oxley Act of 2002
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 32 | Certification
                                                               of the Chief Executive Officer and Chief Financial Officer pursuant
                                                               to Section 906 of the Sarbanes-Oxley Act of 2002
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------











SIGNATURES



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



| | USG1, INC
| | ---------
| |          
| | By:      
| |          



Dated:
      May 11, 2012