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 AUGUST 31,
2009
 
 OR
 
 o
              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 333-148005
 
 XODTEC
GROUP USA, INC.
 
 (Exact
Name of Registrant as specified in its charter)
 
 Nevada
              
              20-8009362(State
      or Other Jurisdiction of Incorporation or Organization)
              
              (IRS
      EmployerIdentification
      No.)
 
 112
      North Curry Street, Carson City, Nevada
              
              89199(Address
      of Principal Executive Offices)
              
              (Zip
      Code)
 
 Issuer’s
Telephone Number, Including Area Code:  (775) 321-1013
  Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90
days.      Yes x    
No o
  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 o       
No x
  Indicate
by check mark whether the registrant is a larger accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one)
  Large
      accelerated filer  o
              Accelerated
      filer  oNon-accelerated
      filer   o
              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
o
  The
numbers of shares outstanding of each of the issuer's classes of common equity,
as of October 20, 2009, are as follows:
  Class
      of Securities
              
              Shares
      OutstandingCommon
      Stock, $0.00 par value
              
              21,230,004


XODTECGROUP USA, INC.


FOR
THE QUARTER ENDED AUGUST 31, 2009


TABLE
OF CONTENTS





INDEX
            PagePART
      I - FINANCIAL INFORMATIONITEM
      1 - FINANCIAL STATEMENTS
            2-12ConsolidatedBalance Sheet at
      August 31, 2009 (unaudited) and February 28, 2009
            2Consolidated Statements of Operations for the three months
      ended August 31, 2009 and six months ended AUGUST 31, 2009
      (unaudited)
            3-4Consolidated Statement of Stockholders’ Equity
      (unaudited)
            5ConsolidatedStatements of Cash
      Flows for six months ended August 31, 2009 and 2008
      (unaudited)
            6Notes to Consolidated Financial Statements
      (unaudited)
            7-12ITEM
      2- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
      CONDITION AND RESULTS OF OPERATIONS
            12-13ITEM
      3  - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
      MARKET RISK
            13ITEM
      4  - CONTROLS AND PROCEDURES
            14-15PART
      I I- OTHER INFORMATION
            16-21ITEM
      1 - LEGAL PROCEEDINGS
            16ITEM
      2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
      PROCEEDS
            16ITEM
      3 - DEFAULTS UPON SENIOR SECURITIES
            16ITEM
      4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY
      HOLDERS
            16ITEM
      5 - OTHER INFORMATION
            16ITEM
      6 – EXHIBITS
            16-21





Table of Contents





XODTECGROUP USA, INC.


(A
Development Stage Enterprise)


Consolidated
BALANCE SHEETS


(Unaudited)








AUGUST
      31, 2009
            
            
            February
      28, 2009ASSETSCURRENT
      ASSETSCash
      and Cash equivalents
            
            $
            119,996
            
            
            $
            107,340Notes
      receivable, net
            
            
            0
            
            
            
            1,014Accounts
      receivable, net
            
            
            1,774,541
            
            
            
            510,702Other
      receivables
            
            
            29,958
            
            
            
            0Other
      receivables-related parties, net
            
            
            1,151,276
            
            
            
            1,084,717Inventories
            
            
            124,209
            
            
            
            245,734Prepayments
            
            
            34,804
            
            
            
            145,705Other
      current assets
            
            
            179,288
            
            
            
            45,670Total
      current assets
            
            
            3,414,072
            
            
            
            2,140,882FIXED
      ASSETSCost
            
            
            151,864
            
            
            
            143,414Less
      : accumulated depreciation
            
            
            ( 90,323
            )
            
            
            (73,440
            )Total
      fixed assets
            
            
            61,541
            
            
            
            69,974OTHER
      ASSETSRefundable
      deposits
            
            
            64,326
            
            
            
            60,608Deferred
      Charge
            
            
            45,160
            
            
            
            27,282Total
      other assets
            
            
            109,486
            
            
            
            87,890Total
      assets
            
            $
            3,585,099
            
            
            $
            2,298,746LIABILITIES
      AND STOCKHOLDERS’ DEFICITCURRENT
      LIABILITIESShort-term
      debt
            
            $
            61,930
            
            
            $
            23,029Notes
      payable
            
            
            135,508
            
            
            
            239,870Other
      notes payable
            
            
            143,744
            
            
            
            0Accounts
      payable
            
            
            148,941
            
            
            
            144,580Accrued
      liabilities
            
            
            413,620
            
            
            
            100,880Income
      tax payable
            
            
            329,524
            
            
            
            174,509Due
      to related party
            
            
            17,633
            
            
            
            655,586Other
      current liabilities
            
            
            6,798
            
            
            
            11,013Total
      current liabilities
            
            
            1,257,698
            
            
            
            1,349,467STOCKHOLDERS’  EQUITYCapital
      stockAuthorized
      common stock (225,000,000 authorized shares; 18,050,000 outstanding
      shares)
            
            
            2,318,364
            
            
            
            2,318,364Retained
      earnings (Deficit accumulated)
            
            
            375,729
            
            
            
            (939,351
            )Cumulative
      translation adjustments
            
            
            (366,692
            )
            
            
            (429,734
            )Total
      stockholders’ equity
            
            
            2,327,401
            
            
            
            949,279Total
      liabilities and stockholders’ equity
            
            $
            3,585,099
            
            
            $
            2,298,746








The
accompanying notes are an integral part of these financial
statements





2
 Table of Contents





XODTECGROUP USA, INC.


(A
Development Stage Enterprise)


Consolidated
STATEMENTS OF OPERATIONS


(Unaudited)





Three
      months ended August 31,2009
            
            
            2008REVENUES
            
            $
            3,006,055
            
            
            $
            587,172COST
      OF GOODS SOLD
            
            
            (1,757,528
            )
            
            
            (233,603
            )GROSS
      PROFIT
            
            
            1,248,527
            
            
            
            353,569OPERATING
      EXPENSES
            
            
            (490,106
            )
            
            
            (194,403
            )RESEARCH
      AND DEVELOPMENT EXPENSES
            
            
            0
            
            
            
            (638
            )OPERATING
      INCOME
            
            
            758,421
            
            
            
            158,528NON-OPRATING
      INCOME AND GAINS
            
            
            74
            
            
            
            63NON-OPRATING
      EXPENSES AND LOSSES
            
            
            (1,330
            )
            
            
            (1,572
            )INCOME
      BEFORE TAX
            
            
            757,165
            
            
            
            157,019INCOME
      TAX
            
            
            0
            
            
            
            0NET
      INCOME FOR THE PERIOD
            
            $
            757,165
            
            
            $
            157,019BASIC
      LOSS PER COMMON SHARE
            
            $
            0.05
            
            
            $
            0.02WEIGHTED
      AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
            
            
            15,715,760
            
            
            
            9,422,440








The
accompanying notes are an integral part of these financial
statements





3
 Table of Contents





XODTEC
GROUP USA, INC.


(A
Development Stage Enterprise)


Consolidated
STATEMENTS OF OPERATIONS


(Unaudited)





Six
      months ended August 31,2009
            
            
            2008REVENUES
            
            $
            4,174,586
            
            
            $
            767,504COST
      OF GOODS SOLD
            
            
            (1,938,367
            )
            
            
            (374,665
            )GROSS
      PROFIT
            
            
            2,236,219
            
            
            
            392,839OPERATING
      EXPENSES
            
            
            (766,663
            )
            
            
            (384,142
            )RESEARCH
      AND DEVELOPMENT EXPENSES
            
            
            (194
            )
            
            
            (642
            )OPERATING
      INCOME
            
            
            1,469,362
            
            
            
            8,055NON-OPRATING
      INCOME AND GAINS
            
            
            98
            
            
            
            1,686NON-OPRATING
      EXPENSES AND LOSSES
            
            
            (10,228
            )
            
            
            (3,572
            )INCOME
      BEFORT TAX
            
            
            1,459,232
            
            
            
            6,169INCOME
      TAX
            
            
            (144,152
            )
            
            
            0NET
      INCOME FOR THE PERIOD
            
            $
            1,315,080
            
            
            $
            6,169BASIC
      LOSS PER COMMON SHARE
            
            $
            0.07
            
            
            $
            0.00WEIGHTED
      AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
            
            
            18,050,000
            
            
            
            9,422,440








The
accompanying notes are an integral part of these financial
statements





4
 Table of Contents





XODTECGROUP USA, INC.


(A
Development Stage Enterprise)


STATEMENT
OF STOCKHOLDERS’ DEFICIT


FOR
THE PERIOD ENDED AUGUST 31, 2009


(Unaudited)





Common
      Stock
            
            
            Additional
      Paid in Capital
            
            
            Deficit
      Accumulated
            
            
            Cumulative
      Translation Adjustments
            
            
            TotalNumber
      of shares
            
            
            AmountBalance,
      March 1, 2009
            
            
            9,460,000
            
            
            $
            2,318,364
            
            
            
            -
            
            
            $
            ( 939,351
            )
            
            $
            (429,734
            )
            
            $
            949,279Change
      in translation adjustments
            
            
            
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            63,042
            
            
            
            63,042Net
      income , August 31, 2009
            
            
            
            
            
            
            -
            
            
            
            -
            
            
            
            1,
      315,080
            
            
            
            -
            
            
            
            1,315,080Balance
      August 31, 2009
            
            
            9,460,000
            
            
            $
            2,318,364
            
            
            $
            -
            
            
            $
            375,729
            
            
            $
            (366,692
            )
            
            $
            2,327,401








The
accompanying notes are an integral part of these financial
statements





5
 Table of Contents





XODTECGROUP USA, INC.


(A
Development Stage Enterprise)


STATEMENTS
OF CASH FLOWS


(Unaudited)





Six
      months ended August 31,2009
            
            
            2008CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      income
            
            $
            1,315,080
            
            
            $
            6,169Adjustment
      to reconcile net income to net cash  provided by operating
      activitiesDepreciation
            
            
            12,331
            
            
            
            11,465Various
      amortization
            
            
            8,670
            
            
            
            3,038Decrease
      (increase) in notes receivable
            
            
            1,014
            
            
            
            (106
            )Increase
      in accounts receivable
            
            
            (1,263,839
            )
            
            
            (206,984
            )Decrease
      (increase) in inventories
            
            
            121,525
            
            
            
            (8,969
            )Decrease
      in prepayments
            
            
            110,901
            
            
            
            30,276Increase
      in other current assets
            
            
            (133,618
            )
            
            
            (3,274
            )Decrease
      in other assets
            
            
            0
            
            
            
            3,856Decrease
      in notes payable
            
            
            (104,362
            )
            
            
            (9,860
            )Increase
      in accounts payable
            
            
            4,361
            
            
            
            20,079Increase
      in accrued liability
            
            
            312,740
            
            
            
            27,198(Decrease)
      increase in other current liabilities
            
            
            (4,215
            )
            
            
            245,476Increase
      (decrease)  in income tax payable
            
            
            155,015
            
            
            
            (225
            )NET
      CASH PROVIDED BY OPERATING ACTIVITIES
            
            
            535,603
            
            
            
            118,139CASH
      FLOWS FROM INVESTING ACTIVITIES
            
            
            
            
            
            
            -Acquisition
      of fixed assets
            
            
            (890
            )
            
            
            (391
            )Disposal
      of fixed assets
            
            
            1,239
            
            
            
            0Increase
      in deferred charges
            
            
            (24,905
            )
            
            
            (10,171
            )(Increase)
      decrease in refundable deposit
            
            
            (3,718
            )
            
            
            1,655(Increase)
      decrease in other receivable
            
            
            (96,517
            )
            
            
            30,334Increase
      in other notes payable
            
            
            143,744
            
            
            
            0NET
      CASH PROVIDED BY OPERATING ACTIVITIES
            
            
            18,953
            
            
            
            21,427CASH
      FLOWS FROM FINANCING ACTIVITIESIncrease
      (repayment ) in short-term debt
            
            
            38,901
            
            
            
            (51,876
            )Repayment
      of shareholder loan
            
            
            (637,953
            )
            
            
            (63,973
            )NET
      CASH  USED IN FINANCING ACTIVITIES
            
            
            (599,052
            )
            
            
            (115,849
            )EFFECT
      OF EXCHANGE RATE CHANGES
            
            
            57,152
            
            
            
            1,639NET
      INCREASE IN CASH
            
            
            12,656
            
            
            
            25,356CASH,
      BEGINNING OF PERIOD
            
            
            107,340
            
            
            
            22,412CASH,
      END OF PERIOD
            
            $
            119,996
            
            
            $
            47,768Supplemental
      cash flow information and noncash financing activities:Cash
      paid for:Interest
            
            $
            1,085
            
            
            $
            3,555





The
accompanying notes are an integral part of these financial
statements





6
 Table of Contents





NOTE1 – NATURE OF OPERATIONS AND BASIS OF
PRESENTATION





Xodtec
Group USA, Inc.  (“Company”) is in the initial development stage and
has incurred losses since inception totaling $13,198.  The Company was
incorporated on November 29, 2006 in the State of Nevada and established a
fiscal year end of February.  The Company is a development stage
enterprise organized to enter into the special event and concert production
industry.





As
described in Note 9 to the financial statements, the Company had share exchange
transaction with Aplus International, Ltd. and this transaction represents a
change in control.








NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





Basis
of Presentation


The
financial statements present the balance sheet, statements of operations,
stockholders' deficit and cash flows of the Company. These financial statements
are presented in United States dollars and have been prepared in accordance with
accounting principles generally accepted in the United States.





RevenueRecognition,
Receivables and Allowance for Doubtful Accounts


Operatingrevenues
are recognized when titles to products and the risks of ownership are
transferred to customers, primarily upon shipment. Because the earnings process
has been completed and the economic benefits associated with the transaction
have been realized or are realizable.





Operating
revenues are measured at fair value of the transaction price negotiated between
the Corporation and its buyers (taking into account commercial and quantity
discounts). Receivables from operating activities are not discounted at the
imputed interest rate since operating receivables are collectible within one
year, fair value approximates the value of receivables on maturity and sales
transactions are frequent.





Allowance
for doubtful accounts is provided on the basis of a review of the collectibility
of receivables. This review includes aging analysis and a review of
customers’
creditworthiness and the economic environment.





Inventories


Inventories
are stated at the lower of monthly-weighted-average cost or market value (net
realizable value).





Inventories
are recorded at standard cost and adjusted to approximate weighted-average cost
on the balance


sheet
date.





Estimated
losses on scrap and slow moving items are recognized as an allowance for
inventory obsolescence.





Fixed
assets


Fixed
assets are stated at cost. The major improvement, renewal and addition, which
can prolong the service life of fixed assets, are counted as capital
expenditures and recorded as fixed assets. Expenditures on regular repairs and
maintenance are recorded as expenses.





Fixed
assets are depreciated according to the service life and using the average
method, with one-year residual value. Renewal and addition are depreciated
according to the fixed assets the fixed assets’ service life. Major improvement
is depreciated based on the remaining service lives of fixed assets. While
assets are continually in use after the expiration of its service life, the
residual values and service lives are estimated and depreciated accordingly and
continually. The gain (loss) on disposal of assets is recognized as
non-operating revenue (expenditure) in the period of sale or
disposal.





Use
of Estimates and Assumptions





Preparation
of the financial statements in conformity with accounting principles generally
accepted in the United States requires management to make estimates and
assumptions that affect certain reported amounts and
disclosures.  Accordingly, actual results could differ from those
estimates.





7
 Table of Contents





Income
Taxes


The
Company follows the liability method of accounting for income taxes in
accordance with Statements of Financial Accounting Standards (“SFAS”) No.109,
“Accounting for Income Taxes” and clarified by FIN 48 “Accounting for
Uncertainty in Income Taxes – an interpretation of FASB Statement No.
109.”  Under this method, deferred tax assets and liabilities are
recognized for the future tax consequences attributable to differences between
the financial statement carrying amounts of existing assets and liabilities and
their respective tax balances.  Deferred tax assets and liabilities
are measured using enacted or substantially enacted tax rates expected to apply
to the taxable income in the years in which those differences are expected to be
recovered or settled.  Deferred tax assets are reduced by a valuation
allowance when, in the opinion of management, it is more likely than not that
some portion or all of the deferred tax assets will not be
realized.  The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the date
of enactment or substantive enactment.





Net
Loss per Share


Basic
loss per share includes no dilution and is computed by dividing loss available
to common stockholders by the weighted average number of common shares
outstanding for the period.  Dilutive loss per share reflects the
potential dilution of securities that could share in the losses of the
Company.  Because the Company does not have any potentially dilutive
securities, the accompanying presentation is only of basic loss per
share.





Foreign
Currency Translation


The
financial statements are presented in United States dollars.  In
accordance with SFAS No. 52, "Foreign Currency Translation", foreign denominated
monetary assets and liabilities are translated to their United States dollar
equivalents using foreign exchange rates which prevailed at the balance sheet
date.  Non-monetary assets and liabilities are translated at exchange
rates prevailing at the transaction date. Revenue and expenses are translated at
average rates of exchange during the periods presented.  Related
translation adjustments are reported as a separate component of stockholder’s
equity (deficit), whereas gains or losses resulting from foreign currency
transactions are included in results of operations





Share
Based Expenses


In
December 2004, the Financial Accounting Standards Board (“FASB”) issued SFAS No.
123R, “Share Based Payment.” This statement is a revision to SFAS 123 and
supersedes Accounting Principles Board (APB) Opinion No. 25, “Accounting for
Stock Issued to Employees,” and amends FASB Statement No. 95, “Statement of Cash
Flows.” This statement requires a public entity to expense the cost of employee
services received in exchange for an award of equity instruments. This statement
also provides guidance on valuing and expensing these awards, as well as
disclosure requirements of these equity arrangements.  The Company
adopted SFAS No. 123R upon creation of the company and expenses share based
costs in the period incurred.








NOTE 3- 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 liquidation 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.





In order
to continue as a going concern, the Company will need, among other things,
additional capital resources. Management’s plan is to obtain such resources for
the Company by obtaining capital from management and significant shareholders
sufficient to meet its minimal operating expenses and seeking equity and/or debt
financing. However management cannot provide any assurances 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. The accompanying financial statements do not include any adjustments
that might be necessary if the Company is unable to continue as a going
concern.





8
 Table of Contents





NOTE 4. -RECENT
ACCOUNTING PRONOUNCEMENTS





SFAS No.
160


In
December 2007, the FASB issued SFAS 160, “Noncontrolling Interests in
Consolidated Financial Statements.” SFAS 160 amends Accounting Research Bulletin
51, “Consolidated Financial Statements,” to establish accounting and reporting
standards for the noncontrolling interest in a subsidiary and for the
deconsolidation of a subsidiary. It also clarifies that a noncontrolling
interest in a subsidiary is an ownership interest in the consolidated entity
that should be reported as equity in the consolidated financial statements. SFAS
160 also changes the way the consolidated income statement is presented by
requiring consolidated net income to be reported at amounts that include the
amounts attributable to both the parent and the noncontrolling interest. It also
requires disclosure, on the face of the consolidated statement of income, of the
amounts of consolidated net income attributable to the parent and to the
noncontrolling interest. SFAS 160 requires that a parent recognize a gain or
loss in net income when a subsidiary is deconsolidated and requires expanded
disclosures in the consolidated financial statements that clearly identify and
distinguish between the interests of the parent owners and the interests of the
noncontrolling owners of a subsidiary. SFAS 160 is effective for fiscal periods,
and interim periods within those fiscal years, beginning on or after December
15, 2008. We do not expect that the adoption of SFAS 160 will have a material
impact on our financial condition or results of operation




SFAS
No. 161


In March
2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments
and Hedging Activities,” (“SFAS No. 161”). SFAS No. 161 amends and expands the
disclosure requirements of SFAS No. 133, “Derivative Instruments and Hedging
Activities,” (“SFAS No. 133”). SFAS No. 161 requires enhanced disclosure about
(i) how and why an entity uses derivative instruments, (ii) how derivative
instruments and related hedged items are accounted for under SFAS No. 133 and
its related interpretations, and (iii) how derivative instruments and related
hedged items affect an entity’s financial position, financial performance and
cash flows. SFAS No. 161 is effective for us as of January 1, 2009. We do not
expect that the adoption of SFAS 161 will have a material impact on our
financial condition or results of operation.




SFAS
No. 163


In March
2008, the FASB issued SFAS No. 163, “Accounting for Financial Guarantee
Insurance Contracts – an interpretation of FASB Statement No.
60.”  SFAS 163 requires that an insurance enterprise recognize a claim
liability prior to an event of default (insured event) when there is evidence
that credit deterioration has occurred in an insured financial
obligation.  This Statement also clarifies how Statement 60 applies to
financial guarantee insurance contracts, including the recognition and
measurement to be used to account for premium revenue and claim liabilities.
Those clarifications will increase comparability in financial reporting of
financial guarantee insurance contracts by insurance enterprises. This Statement
requires expanded disclosures about financial guarantee insurance contracts. The
accounting and disclosure requirements of the Statement will improve the quality
of information provided to users of financial statements.  SFAS 163
will be effective for financial statements issued for fiscal years beginning
after December 15, 2008.  The Company does not expect the adoption of
SFAS 163 will have a material impact on its financial condition or results of
operation.






NOTE
5 - FAIR VALUE OF FINANCIAL INSTRUMENTS





In
accordance with the requirements of SFAS No. 107and SFAS No. 157, the Company
has determined the estimated fair value of financial instruments using available
market information and appropriate valuation methodologies.  The fair
value of financial instruments classified as current assets or liabilities
approximate their carrying value due to the short-term maturity of the
instruments.






NOTE
6 – CAPITAL STOCK





The
Company’s capitalization consists of 235,000,000 shares of capital stock with a
par value of $0.001 per share, of which 225,000,000 shares are common stock and
10,000,000 shares are preferred stock.





On
December 11, 2006, the sole Director purchased 9,000,000 shares of the common
stock in the Company at $0.001 per share for $9,000.





9
 Table of Contents





During
March, April and August 2008 the Company sold 460,000 shares of the common stock
to investors at a price of $0.02 per share in a private placement, for a total
of $9,200.





As of
April 20, 2009, the Company has not granted any stock options and has not
recorded any stock-based compensation.





As
described in Note 9 to the financial statements, the Company had share exchange
transaction with Aplus International, Ltd. and as the result of such shares
exchange, outstanding amount to 18,050,000 shares as August 31,
2009.





NOTE
7 – RELATED PARTY TRANSACTIONS




The
Company neither owns nor leases any real or personal property.  An
officer or resident agent of the corporation provides office services without
charge.  Such costs are immaterial to the financial statements and
accordingly, have not been reflected therein.  The officers and
directors for the Company are involved in other business activities and may, in
the future, become involved in other business opportunities.  If a
specific business opportunity becomes available, such persons may face a
conflict in selecting between the Company and their other business
interest.  The Company has not formulated a policy for the resolution
of such conflicts.





As of
August 31, 2009 and February 29, 2008, the Company received advances from a
Director in the amount of $17,633 and $655,586, respectively. Also, as of August
31, 2009 and February 29, 2008, the Company loan to the shareholders amounted to
$1,151,276 and 1,084,717, respectively. The amounts due to and due from the
related party are unsecured and non-interest bearing with no set terms of
repayment.





NOTE
8 – INCOME TAXES




We did
not provide any current or deferred U.S. federal income tax provision or benefit
for any of the periods presented because we have experienced operating losses
since inception. Per Statement of Accounting Standard No. 109 – Accounting for
Income Tax and FASB Interpretation No. 48 - Accounting for Uncertainty in Income
Taxes an interpretation of FASB Statement No.109, when it is more likely than
not that a tax asset cannot be realized through future income the Company must
allow for this future tax benefit.  We provided a full valuation
allowance on the net deferred tax asset, consisting of net operating loss
carryforwards, because management has determined that it is more likely than not
that we will not earn income sufficient to realize the deferred tax assets
during the carryforward period.




The
Company has not taken a tax position that, if challenged, would have a material
effect on the financial statements for the twelve-months ended April 20, 2009,
or during the prior three years applicable under FIN 48.




As a
result of the adoption of FIN 48, we did not recognize any adjustment to the
liability for uncertain tax position and therefore did not record any adjustment
to the beginning balance of accumulated deficit on the consolidated balance
sheet.




The components
of the Company’s deferred tax asset as of August 31, 2009 and February 29, 2008
are as follows:




Aug. 31, 2009
            
            
            Feb. 29, 2008Allowance
      for loss on inventory
            
            $
            1,474
            
            
            $
            1,737Valuation
      allowance
            
            
            0
            
            
            
            0Net
      deferred tax asset
            
            $
            1,474
            
            
            $
            1,737




A
reconciliation of income taxes computed at the statutory rate to the income tax
amount recorded is as follows:




Aug. 31, 2009
            
            
            Feb. 29, 2008
            
            
            Since InceptionTax
      at statutory rate (25%)
            
            $
            1,474
            
            
            $
            1,737
            
            
            $
            1,474Increase
      in valuation allowance
            
            
            0
            
            
            
            0
            
            
            
            0Net
      deferred tax asset
            
            $
            1,474
            
            
            $
            1,737
            
            
            $
            1,474





10
 Table of Contents





NOTE
9. – ACQUISITION OF APLUS INTERNATIONAL, LTD.





On April
20, 2009, the Company acquired APlus International, Ltd. a privately owned
Nevada limited liability company (“APlus”), pursuant to an Agreement and Plan of
Share Exchange (the “Exchange”).  APlus is a holding company whose
principal operating companies design, manufacture, market and sell advanced
lighting solutions, including light emitting diode (LED) lighting and other
energy-saving lighting in Taiwan.  Upon consummation of the Exchange,
the Company adopted the business plan of APlus.





Pursuant
to the terms of the Exchange, the Company acquired APlus in exchange for an
aggregate of 5,333,334 newly issued shares (the “Exchange Shares”) of the
Company’s common stock, par value $0.001 per share (the “Common Stock”). As a
result of the Exchange, APlus International, Ltd. became a wholly-owned
subsidiary of Xodtec Group USA, Inc.  Xodtec Group USA, Inc. shares
were issued to the APlus International, Ltd.  In addition, the
Company’s principal stockholder, Adam Borges Dos Santos agreed to retire his
9,000,000 shares of Common Stock.  Following the issuance of the
Exchange Shares and the retirement of Mr. Dos Santos’ shares, the former members
of APlus now beneficially own approximately 92% of the outstanding shares of our
Common Stock. Accordingly, the Exchange represented a change in
control.





The
Company also issued 116,667 shares of Common Stock and warrants to purchase
additional 83,334 shares of common stock at an exercise price of $1.00 per share
and expiring in 2 years, for services rendered by Dragonfly Capital Partners,
LLC (“Dragonfly”) in connection with the Exchange.





Also on
April 20, 2009, following the Exchange, the Board of Directors of the Company
approved an amendment to the Company’s Articles of Incorporation increasing the
number of authorized shares of common stock from 75,000,000 to 225,000,000 and
concurrently effectuating a three for one (3:1) forward-split of the Company’s
issued and outstanding shares of Common Stock.  Further, on April 22,
2009 a majority of shareholders of Xodtec Group USA, Inc. approved an amendment
to the Company’s articles of incorporation to change the name of the Company to
Xodtec Group USA, Inc. and the creation of 10,000,000 shares of blank check
preferred stock.





At the
effective time of the Exchange, our board of directors was reconstituted by the
resignation of Mr. Adam Borges Dos Santos from his role as sole principal
officer and director, and the appointment of Yao-Ting (Curtis) Su, Chao-Wu
(Mike) Chou and Hui-Yu (Rachel) Che as directors. Our executive management team
also was reconstituted following the resignation of Mr. Dos Santos as APlus’
president, and new officers were appointed in place of our former officers. See
“Directors and Executive
Officers, Promoters and Control Persons.”





On April
22, 2009 the Company entered into a Financial Advisory Agreement with Unise
Investment Corp. to provide financial consulting services in consideration for
116,667 shares of Common Stock.  Further, on April 23, 2009, the
Company sold warrants exercisable into 200,000 post-split shares of Common Stock
at the exercise price of $0.65 per share and expiring in 6 months, warrants
exercisable into 500,000 shares of Common Stock at the exercise price of $1.00
per share and expiring in 2 years and warrants exercisable into post-split
800,000 shares of





11
 Table of Contents





Common
Stock at the exercise price of $1.50 per share and expiring in 2
years.  Additionally, the Company agreed to register the shares of
Common Stock underlying these warrants and the warrants issued to Dragonfly, as
well as the shares of Common Stock issued to Dragonfly.






NOTE
10. –SHOR-TERM DEBTS





Short-term debts were loans from
banks both with 5% to 6% and 6.19% interest in Aug. 31, 2009 and Feb. 29, 2008,
respectively.





NOTE
11. –SIGNIFIVANT COMMITIMENTS AND CONTINGENCIES





The
company’s offices and transportation equipments are under operating lease, and
leasing period is from Dec. 31, 2009 to Aug. 31, 2012. The company minimum rent
for the future is as follows:





Period
      of payment
            
            AmountsSep.
      1, 2009 to Aug. 31, 2010
            
            184,295Sep.
      1, 2010 to Aug. 31, 2011
            
            134,142Sep.
      1, 2011 to Aug. 31, 2012
            
            60,330








ITEM2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS




The
Company is including the following cautionary statement in this Quarterly Report
on Form 10-Q to make applicable and utilize the safe harbor provision of the
Private Securities Litigation Reform Act of 1995 regarding any forward-looking
statements made by, or on behalf of, the Company.  Forward-looking
statements include statements concerning plans, objectives, goals, strategies,
future events or performance and underlying assumptions and other statements,
which are other than statements of historical facts.  Certain
statements contained herein are forward-looking statements and, accordingly,
involve risks and uncertainties, which could cause actual results or outcomes to
differ materially from those expressed in the forward-looking
statements.





The
Company’s expectations, beliefs and projections are expressed in good faith and
are believed by the Company to have a reasonable basis, including without
limitations, examination of historical operating trends, data contained in
records and other data available from third parties, but there can be no
assurance that the Company’s expectations, beliefs or projections will result,
or be achieved, or be accomplished.





The
Company’s expectations, beliefs and projections are expressed in good faith and
are believed by the Company to have a reasonable basis, including without
limitations, examination of historical operating trends, data contained in
records and other data available from third parties, but there can be no
assurance that the Company’s expectations, beliefs or projections will result,
or be achieved, or be accomplished.




The
company designs, manufactures, markets and sells advanced LED lighting products
and solutions. The company’s product line-up covers a broad range of technically
innovative outdoor lighting, indoor general and accent lighting, and
color-changing lighting lamps and fixtures that are used for applications in
commercial, architectural, residential, hospitality, entertainment and consumer
markets.




The
company generates revenue from selling her lighting products and solutions into
commercial, architectural, residential, and other markets. Commercial sales
include the lighting solution design and applications of advanced LED lamps,
fixtures, and associated control systems. Architectural sales mainly focus on
the installation of wall wash lighting, light strips, and display panel.
Residential sales are addressed on the replacement market which currently
installed with traditional energy-consuming lighting products such as
incandescent lamps, compact fluorescent lamps, and fluorescent
tubes.




Revenue




Revenue
is derived from sales of our advanced lighting products and solutions. These
products consist of solid-state LED lighting lamps, fixtures, and control
systems. Besides the LED lighting related businesses, some of our revenue comes
from our professional project management service such as energy-saving system
design, landscape lighting design, and language globalization
services..




Cost of Goods
Sold




The
company’s cost of goods sold consists primarily of labor-related overhead, such
as R&D professionals, designers, and administrative personnel. We project
management services based on customer orders. Besides our in-house resources, we
also out-source part of projects to support such demand.





12
 Table of Contents




Gross
Profit




Our gross
profit has been and will continue to be affected by a variety of factors,
including changing of the foreign exchange rates for exporting, out-sourcing
cost to support project demands, and average sales prices of our products,
including fluctuations in the cost of our purchased components, sales price and
the product life cycle.




Operating
Expenses




Operating
expenses consist primarily of salaries and associated costs for employees in
finance, human resources, sales, information technology and administrative
activities. In addition, operating expenses include charges relating to
accounting, legal, insurance and stock-based compensation under Statement of
Financial Accounting Standards No. 123(R), “Share-Based Payment.”





Difference in sales and
gross profit between 2009 Q1 and 2008 Q1 was due to the group acquiring
the patent for it self-invented wafers and the improvement of related
technology. The Company started to get the sales order of lighting and design
service from the latter half of FY 2008 and service revenue increased for USD
853,000 in 2009 Q1 comparing with that in 2008 Q1. The Company introduced new
products and new sales channel and thus sales revenue in 2009 Q1 increased for
about US 150,000 comparing with that in 2008Q1. Since the cost of service
revenue primarily consists of staff costs and such costs didn’t rise in
proportion to the percentage of service revenue increase, gross profit and gross
profit ratio obviously increased.





Difference in operating
expense between 2009 Q1 and 2008 Q1 was because that the Company had
higher operating expense due to higher sales revenue. The other reason for the
increase of USD $76,125 operating expense was due to the Companying moving its
office to a larger office in early 2009. On the other hand, the Company didn’t
initiate the new R&D project and hence R&D cost in 2009Q1 decreased for
US $745 comparing with that in 2008 Q1.





Difference in non-operating
income and gain was due to the Company subleased its idle office space in
2008 Q1 but it didn’t have such sublease in 2009Q1. Thus, it resulted in the
decrease of non-operating income and gain for USD 1,600 .





Difference in non-operating
expense and losswas because the Company paid off the entire bank loan
and resulted in the decrease of USD $1,560 interest expense








ITEM3–QUANTITATIVE AND
QUALITATIVE DISCLOSURES ABOUT MARKET RISK




As a
result of its operations in Taiwan, the Company is exposed to various market
risks, including changes in interest rates. Market risk is the potential loss
arising from adverse changes in market rates and prices, such as interest rates
and foreign currency exchange rates. The Company does not anticipate that these
risks will adversely affect the Company’s operations.  Accordingly,
the Company does not enter into derivatives or other financial instruments for
trading or speculative purposes. The Company also has not entered into financial
instruments to manage and reduce the impact of changes in interest rates and
foreign currency exchange rates, although we may enter into such transactions in
the future.




13





ITEM4 – CONTROLS AND PROCEDURES





Evaluation
of Disclosure Controls and Procedures





The
management of the Company is responsible for establishing and maintaining
adequate internal control over financial reporting. Internal control over
financial reporting is defined in Rule 13a-15(f) or 15d(f) promulgated under the
Securities Exchange Act of 1934 as a process designed by, or under the
supervision of, the Company’s Chief Executive Officer and Chief Financial
Officer and effected by the Company’s board of directors, management and other
principal officers to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of the Company’s financial statements
for external purposes in accordance with accounting principles generally
accepted in the United States of America and includes those policies and
procedures that:





- pertain
to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of the assets of the
Company;





- provide
reasonable assurance that the transactions are recorded as necessary to permit
preparation of financial statements in accordance with the accounting principles
generally accepted in the United States of America and that receipts and
expenditures of the Company are being made only in accordance with the
authorizations of management and directors of the Company; and





- provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the Company’s assets that could have a
material effect on the financial statements.





Because
of its inherent limitations, internal control over financial reporting AUGUST
not prevent or detect misstatements. Projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.  All internal control
systems, no matter how well designed, have inherent
limitations.  Therefore, even those systems determined to be effective
can provide only reasonable assurance with respect to financial statement
preparation and presentation.  Because of the inherent limitations of
internal control, there is a risk that material misstatements may not be
prevented or detected on a timely basis by internal control over financial
reporting. However, these inherent limitations are known features of the
financial reporting process.  Therefore, it is possible to design into
the process safeguards to reduce, though not eliminate, this risk.





As of
August 31, 2009 management assessed the effectiveness of the Company’s internal
control over financial reporting based on the criteria for effective internal
control over financial reporting established in Internal Control – Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission (“COSO”) and SEC guidance on conducting such
assessments.  Based on that evaluation, they concluded that, during
the period covered by this report, such internal controls and procedures were
not effective to detect the inappropriate application of US GAAP rules as more
fully described below. This was due to deficiencies that existed in the design
or operation of our internal control over financial reporting that adversely
affected our internal controls and that may be considered to be material
weaknesses.





14
 Table of Contents





The
matters involving internal controls and procedures that the Company’s management
considered to be material weaknesses under the standards of the Public Company
Accounting Oversight Board were: (1) lack of a functioning audit committee due
to a lack of a majority of independent members and a lack of a majority of
outside directors on the Company's board of directors, resulting in ineffective
oversight in the establishment and monitoring of required internal controls and
procedures; (2) inadequate segregation of duties consistent with control
objectives; and (3) ineffective controls over period end financial disclosure
and reporting processes. The aforementioned material weaknesses were identified
by the Company's Chief Financial Officer in connection with the review of our
financial statements as of November 30, 2008.





Management
believes that the material weaknesses set forth in items (2) and (3) above did
not have an affect on the Company's financial results. However, management
believes that the lack of a functioning audit committee and lack of a majority
of outside directors on the Company's board of directors, results in ineffective
oversight in the establishment and monitoring of required internal controls and
procedures which could result in material misstatement in our financial
statements for the future periods.





In an
effort to remediate the indentified material weaknesses and other deficiencies
and enhance our internal controls we have initiated, or plan to initiate, the
following series of measures:


We will
create a position to segregate duties consistent with control objectives and
will increase our personnel resources and technical accounting expertise within
the accounting function when funds are available to us.  We plan to
appoint one or more outside directors to our board of directors who shall be
appointed to an audit committee resulting in a fully functioning audit committee
who will undertake the oversight in the establishment and monitoring of required
internal controls and procedures such as reviewing and approving estimates and
assumptions made my management when funds are available to us.





Management
believes that the appointment of one or more outside directors, who shall be
appointed to a fully functioning audit committee, will remedy the lack of a
functioning audit committee and a lack of a majority of outside directors on the
Company's Board.





We will
continue to monitor and evaluate the effectiveness of our internal controls and
procedures and our internal controls over financial reporting on an ongoing
basis and are committed to taking further action and implementing additional
enhancements or improvements, as necessary and as funds allow.





There was
no change in our internal controls over financial reporting that occurred during
the quarter ended August 31, 2009 that have materially affected or are
reasonably likely to materially affect, our internal controls over financial
reporting.





15
 Table of Contents





PART
II OTHER INFORMATION





ITEM1 – LEGAL PROCEEDINGS





None





ITEM2 – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS





During
the three months ended AUGUST 31, 2009, the Company issued the following
securities:





On April
20, 2009, the Company acquired APlus International, Ltd., a privately owned
Nevada limited liability company (“APlus”), pursuant to an Agreement and Plan of
Share Exchange for an aggregate of 5,333,334 newly issued, pre-split shares of
the Company’s Common Stock.





On April
22, 2009 the Registrant entered into a Financial Advisory Agreement with Unise
Investment Corp. to provide financial consulting services in consideration for
111,667 shares of Common Stock.





On April
23, 2009, the Registrant sold warrants exercisable into 200,000 shares of Common
Stock at the exercise price of $0.65 per share and expiring in 6 months,
warrants exercisable into 500,000 shares of Common Stock at the exercise price
of $1.00 per share and expiring in 2 years and warrants exercisable into 800,000
shares of Common Stock at the exercise price of $1.50 per share and expiring in
2 years.





ITEM3 – DEFAULTS UPON SENIOR SECURITIES





None





ITEM4 – SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS





On April
22, 2009, a majority of our holders of common stock, par value $0.001 per share
(the “Common Stock”) voted in favor of amending the Company’s Articles of
Incorporation to change the name of the Company to “Xodtec Group USA, Inc.” and
to increase the Company’s authorized capital stock to 235,000,000, shares of
which 225,000,000 shares will be Common Stock, $0.001 par value, and 10,000,000
shares will be Preferred Stock, $0.001 par value.





ITEM5 – OTHER INFORMATION





None.





ITEM6 – EXHIBITS





a)
Exhibit index





Exhibit         
Description of the Exhibit




31.1               Chairman
of the Board Certification of Periodic Financial Report Pursuant to Section 302
of the Sarbanes-Oxley Act of 2002.




31.2               Chief
Financial Officer Certification of Periodic Financial Report Pursuant to Section
302 of the Sarbanes-Oxley Act of 2002.




32.1               Chairman
of the Board Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.




32.2               Chief
Financial Officer Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes Oxley Act of 2002.





16
 Table of Contents





SIGNATURES





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








XODTEC
      GROUP USA, INC.Date:     October
      20, 2009
            
            /s/Yao-Ting
    SuYao-Ting
      SuPresident,
      Chairman of the Board(principal
      executive officer)Date:     October
      20, 2009
            
            /s/ Hui-Yu CheHui-Yu
      CheChief
      Financial Officer(principal
      accounting officer)






17