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USCORP - Draft Response to SEC Comments

August 12, 2005

Mark A. Wojciechowski, Staff Accountant

United States Securities and Exchange Commission

Division of Corporation Finance

Via Fax: 202-772-9220

Re: USCorp Form 10-KSB/A for Fiscal Year Ended September 30, 2004 filed May 12, 2005, USCorp Form 10-QSB for Period Ended March 31, 2005; and my conversations with you by telephone on August 8, and August 9, 2005.

Dear Mark,

In partial response to the comments you sent to us in your letter dated July 13, 2005, we have prepared the following drafts of answers to your questions and a draft revision of the above referenced Form 10-KSB/A, attached.

For you convenience we have quoted your first 8 comments and our responses below. We have marked the attached draft 10-KSB/A with numbers referencing your comments where appropriate.

Sincerely,

/s/ Robert Dultz

Robert Dultz, Chairman and CEO

Draft Response to SEC Comments

August 9, 2005

Page 1 of 42

“10-KSB/A for the Fiscal Year Ended December 2004

Independent Auditor’s Report page F-1

1. Your audit report does not cover the inception to date period presented in your financial statements. If your auditors are not extending audit coverage to the inception to date information, you must label it as unaudited.”

The “unaudited” title has been added to the Inception to Date columns of the statement of operations and the statement of cash flow. Please see pages 6 and 7 below. Please note that prior financial statements of the company, filed with the Commission, were audited by prior auditors of the Company.

“2. Please refer your auditors to the guidance in PCAOB Auditing Standard No. 1, requiring registered auditors to make reference in their audit reports to the standards of the Public Company Accounting Oversight Board (PCAOB).”

The report page has been modified for the correct wording as follows: “We conducted our audit in accordance with auditing standards generally accepted by the Public Company Accounting Oversight Board in the United States”.

“Consolidated Statement of Shareholders Equity. page F-5

3, Please revise your Statement to include the inception to date activity necessary to comply with the guidance in paragraph 11(d) of SFAS 7.”

The statement has been amended to comply with SFAS 7, paragraph 11(d) Please see below pages 7-10.

Note 1 — Organization of the Company and Significant Accounting Principles, page F-6

4.

You state that in April 2002 you acquired US Metals Inc. (US Metals) by issuing 24,000,000 shares of common stock. Please explain to us if at the time of acquisition you considered US Metals to be a business as defined in EITF 98-3, or whether the transaction was the acquisition of an asset. Include a discussion of the factors listed in EITF 98-3 in your response. Additionally, tell us the cost basis of the assets acquired from US Metals immediately prior to the acquisition.

The Company purchased an asset and not a subsidiary and the wording has been changed. Please see Pages 12-13 below.

5. Please disclose your accounting policy for stock issued to employees and non-employees, and the other information required under paragraphs 45 through 48 of SFAS 123.

See Note 12 added to the revised financials as follows:

“12.  Stock Warrants Outstanding

At September 30, 2003, the Company received a loan from two shareholders of $40,000.  The loans are unsecured and mature September 30, 2004 at no stated interest rate.  The loan agreement calls gives the

Draft Response to SEC Comments

August 9, 2005

Page 2 of 42

option to the shareholders to convert the proceeds of the loan into shares of common stock at $.40 per share.  As a result, the Company has imputed a beneficial conversion feature of $3,767 to the proceeds received.  The beneficial conversion feature was amortized to interest expense over fiscal 2004.

The following table summarizes the details of the number of warrants issued and outstanding and the weighted average exercise price and years remaining on the warrants.

                  Wgtd Avg

              Wgtd Avg

   Years to

          Amount

   Exercise Price

   Maturity

Outstanding at October 1, 2002

     0

Issued

         100,000

Expired

         0

Exercised

         0

Outstanding at September 30, 2003

   100,000

   $0.40

   1

Issued

         0

Expired

         0

Exercised

         (100,000)

Outstanding at September 30, 2004

   0

   $0.00

   0

The Company applied the Black-Scholes option pricing model to determine the fair value of the detachable stock warrants and common stock warrants issued in fiscal year 2004. The following assumptions were used in the model. The dividend yield is 0%, volatility is 20%, and a risk-free interest rate of 2%. The fair values generated by the Black-Scholes model may not be indicative of the future values, if any, that may be received by the warrant holder.

The Company has a formal stock option incentive plan for employees.”

Mineral Properties, page F-7

6.

We note your disclosure indicating that you use the successful efforts method of a accounting for activities related to your mineral properties. Please note that the guidance in paragraph 6 of SFAS 19 limits application of the successful efforts method of accounting to oil and gas producing activities. Since your business is mining, until you are able to report reserves, as defined in Industry Guide 7, the appropriate characterization of your enterprise would be that of an exploration stage company, rather than a development stage company. During this period, all costs incurred in the exploration for proved reserves should be expensed as incurred, rather than deferred pending the results of exploration. Please revise your accounting and disclosures as necessary.

The note disclosure regarding accounting for mineral properties has been amended as follows: “Mineral Properties- The Company is an exploration stage company.  All costs incurred in the exploration of proved reserves are expensed to the statement of operations.”

7 The allocation of the net assets acquired from US Metals included on page 13 of your Form 10-QSB for the quarterly period ended March 31, 2005 indicates the value of the mining rights acquired in 2002

Draft Response to SEC Comments

August 9, 2005

Page 3 of 42

Was $2,449,466. We note the amount recorded has not changed since that time. Please submit the analysis that you performed, testing your mining rights and any capitalized development costs for recoverability, to comply with the guidance in paragraph 8(e) of SFAS 144.

The Company purchased the mining asset in April 2002 for 24,200,000 shares of stock.  The bid price of the stock at the time was $1.01 for a total value of $24,200,000. However, at the time there was very little trading of the Company’s stock, so the Company assigned an arbitrary value of about $.10 per share for a total of $2,449,446. The Company compared the purchase valued at $2,449,446, to the appraised value of $100,000 per claim for the 134 claims held at the time of the appraisal, a total value of $13,400,000.  For the sake of conservatism, the Company recorded the lower value.  Management has reviewed this asset each year for impairment and has determined that if present negotiations to realize this asset do not come to fruition, the Company intends to impair this asset at the end of fiscal 2005 (9-30-05), three years after the asset purchased.

Exhibit 31.1 — Certification Pursuant to Section 302 of the Sarbanes Oxley Act of 2002

8. Please refer to the guidance contained in item 601 of Regulation S-B regarding the appropriate timing for conducting your evaluation of internal control as well as other applicable changes within the Section 302 certification.

Noted.

Form 10-QSB for the Ouarterly Period Ended March 31, 2005

Management’s Discussion and Analysis page 12

Chocolate Mountain Region Claims Acquisition page 14

9. You indicate that you granted former Owners of two gold mining claims near Kingman, Arizona an option to acquire 250,000 shares of your common stock at the then current market price within a two year period. Please revise your disclosure to clarify whether the phrase “at the then current market price” is the price on the date you grant the options or the market price on the date the owners decide to exercise the options. If the price represents the market price on the date the owners elect to exercise, please explain to us what, if any, value is associated with the options since the owners could presumably purchase the shares in the over-the-counter market.

Please see response to Comment 10 below.

10. You explain that the options referred to in comment 9 above were exercised on March 23, 2005. It appears the exercise of the options did not have an impact on your financial statements. Please explain to us how you accounted for the exercise, and cite the specific accounting literature you utilized to determine the appropriate treatment.

The wording has been changed as follows: “Under the terms of the acquisition, the Company granted the former owners of the claims an option to acquire 250,000 shares of the Company’s common stock at the then current market price at any time within a two year period. The option was converted into a payment for consulting services and expensed as such.”

Draft Response to SEC Comments

August 9, 2005

Page 4 of 42

DONAHUE ASSOCIATES, L.L.C.

 27 BEACH ROAD, SUITE CO5-A

    MONMOUTH BEACH, NJ.    07750

              Phone: (732) 229-7723

                 Independent Auditor’s Report

The Shareholders

USCorp.

(an Exploration Stage Company)

We have audited the accompanying consolidated balance sheets of USCorp. as of September 30, 2004 and September 30, 2003 and the related consolidated statements of operations and consolidated statements of changes in shareholders’ equity and cash flows for the years then ended. These financial statements are the responsibility of management.  Our responsibility is to express an opinion on these financial statements based on our audit.

Answer to Comment 2

We conducted our audit in accordance with auditing standards generally accepted by the Public Company Accounting Oversight Board in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of USCorp. as of September 30, 2004 and September 30, 2003 and the related consolidated statements of operations and consolidated statement of changes in shareholders’ equity and cash flows for the years then ended then ended in conformity with generally accepted accounting principles generally accepted in the United States of America.

As more fully discussed in Note 2 to the consolidated financial statements, there are significant matters concerning the Company that raise substantial doubt as to the ability of the Company to continue as a going concern.  Management’s plans with regard to these matters are also described in Note 2 to the consolidated financial statements.  The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets or the amounts and classifications of recorded liabilities that might be necessary in the event that the Company cannot continue in existence.

Monmouth Beach, New Jersey

November 10, 2004

Draft Response to SEC Comments

August 9, 2005

Page 5 of 42

USCorp.

(an Exploration Stage Company)

Consolidated Balance Sheets

As of September 30, 2004 and September 30, 2003

Answer to Comment 1 on pages 6 and 7

ASSETS

         2004

   2003

Current assets:

   Cash

         $16,781

   $59,555

   Total current assets

       16,781

   59,555

Other assets:

   Mining rights

         2,449,466

   2,449,466

   Equipment- net

       2,417

   0

  Total assets

       $2,468,664

   $2,509,021

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

   Accounts payable & accrued expenses

     $38,797

   $529,311

   Subscriptions payable-net

     49,657

   0

   Advance payable to shareholder

     44,167

   36,233

  Total current liabilities

     132,621

   565,544

Shareholders' equity:

    Series A preferred stock, one share convertible to eight shares of common;

       no stated dividend, stated value $0.01, 10,000,000 shares authorized,

       no shares outstanding at September 30, 2004 and September 30, 2003

 $0

   $0

    Series B preferred stock, one share convertible to two shares of common;

       10% cumulative stated dividend, stated value $0.50, 50,000,000 shares authorized,

       no shares outstanding at September 30, 2004 and September 30, 2003

 0

   0

   Common stock- $.01 par value, authorized 100,000,000 shares,

  issued and outstanding, 29,531,459 shares at September 30, 2004

  and 25,793,073 shares at September 30, 2003

   295,314

   257,931

   Additional paid in capital

     6,685,716

   5,366,425

   Accumulated deficit during exploration stage

       (4,644,987)

   (3,680,879)

  Total shareholders' equity

     2,336,043

   1,943,477

  Total Liabilities & Shareholders' Equity

   $2,468,664

   $2,509,021

See the notes to the financial statements.

Draft Response to SEC Comments

August 9, 2005

Page 6 of 42

          USCorp.

    (an Exploration Stage Company)

         Consolidated Statements of Operations

                     For the Years Ended September 30, 2004 and September 30, 2003

                   and from Inception, May 1989 through September 30, 2004

Answer to Comment 3 on Pages 7 - 10

Unaudited

                  Inception

          2004

   2003

   to Date

General and administrative expenses:

  Consulting

     $730,657

   $762,522

   $2,752,789

  Administration

     149,048

   83,532

   840,113

  License expense

     26,289

   14,100

   109,532

  Professional fees

     50,180

   5,133

   334,619

   Total general & administrative expenses

 956,174

   865,287

   4,037,053

Net loss from operations

     (956,174)

   (865,287)

   (4,037,053)

Other income (expenses):

  Interest expense

     (7,934)

   0

   (7,934)

  Loss on mining claim

     0

   0

   (600,000)

Net loss before provision for income taxes

   (964,108)

   (865,287)

   (4,644,987)

Provision for income taxes

   0

   0

   0

Net loss

       ($964,108)

   ($865,287)

   ($4,644,987)

Basic & fully diluted net loss per common share

 ($0.04)

   ($0.03)

Weighted average of common shares outstanding:

 Basic & fully diluted

     27,352,907

   25,352,944

See the notes to the financial statements.

Draft Response to SEC Comments

August 9, 2005

Page 7 of 42

USCorp.

     (an Exploration Stage Company)

          Statements of Cash Flows

  For the Years Ended September 30, 2004 and September 30, 2003

                   and from Inception, May 1989 through September 30, 2004

                  Unaudited

                  Inception

          2004

   2003

   to Date

Operating Activities:

  Net loss

       ($964,108)

   ($865,287)

   ($4,644,987)

  Adjustments to reconcile net income items

    not requiring the use of cash:

  Loss on sale of mining claim

   0

   0

   600,000

  Consulting fees

     673,898

   272,784

   1,946,492

  Depreciation expense

   583

   0

   583

  Interest expense

     7,934

       7,934

Changes in other operating assets and liabilities :