<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 1997
Commission File Number: 33-22142
REDOX TECHNOLOGY CORPORATION
Delaware Corporation 55-0681106
(State of Incorporation) (I.R.S. Employer Identification No.)
340 North Sam Houston Parkway East, Suite 250
Houston, Texas 77060
(713) 445-0020
DCUSA CORPORATION
(Former Name and former fiscal year, changed since last report)
-----------------------
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES X NO
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
<TABLE>
<CAPTION>
CLASS NUMBER OF SHARES OUTSTANDING
ON: MARCH 31, 1997
<S> <C>
Common Stock
par value $0.00005 per share 45,400,000
</TABLE>
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PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS OF ReDOX TECHNOLOGY CORPORATION
(Hereinafter referred to as Registrant or Company)
Registrant prepared the accompanying financial statements from its own
books and records. In management's opinion, these financial statements present
fairly in all material respects Registrant's financial condition and changes
therein as of December 31, 1996, and the results of operations and cash flows
for the period, in conformity with generally accepted accounting principles.
As discussed in the Notes to these financial statements, these
statements have been prepared on the presumption that the Company is and will
remain a going concern. The Registrant's long-term survival, and its ability to
generate revenues from operations is contingent upon raising capital in
sufficient amounts to commence operations for production and sale of its
products. The likelihood of this acquisition of capital is uncertain, and the
Registrant cannot assure success in so doing. If Registrant does not receive
suitable funding, the Company will continue to incur losses, and could be
unable to continue as a going concern. The accompanying financial statements do
not include any provisions for the outcome of this uncertainty.
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REDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Balance Sheet
as of March 31, 1997
<TABLE>
<S> <C>
ASSETS
Current Assets:
Cash - Checking $ 651
--------------
TOTAL CURRENT ASSETS 651
FIXED ASSETS: (See Note 3)
Office Equipment $ 8,395
Furniture & Fixtures 18,000
Accumulated Depreciation (15,838)
--------------
TOTAL FIXED ASSETS $ 10,557
--------------
OTHER ASSETS:
Patent (See note 4 and 8) $ 1,500
Security Deposits 1,159
Organization Costs 400
Goodwill $ 50,000
--------------
TOTAL OTHER ASSETS 53,059
--------------
TOTAL ASSETS $ 64,267
==============
</TABLE>
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REDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Balance Sheet
as of March 31, 1997
<TABLE>
<S> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts Payable $ 686
----------------
STOCKHOLDERS' EQUITY:
Common Stock, par value $.00005 per share
100,000,000 authorized. 45,400,000 issued and
outstanding. (See note 5 and 10) $ 2,320
Convertible Preferred Stock, par value $.001
10,000,000 shares authorized. 6,000,000 shares
issued and outstanding. 6,000
Additional Paid-in Capitol (See note 6 and 10) 403,256
Accumulated Deficit - December 31, 1996 (347,995)
----------------
TOTAL SHARHOLDERS EQUITY 63,581
TOTAL LIABILITIES AND EQUITY $ 64,267
================
</TABLE>
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REDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Statement of Income and Retained Earning
for the Quarter ending March 31, 1997
<TABLE>
<S> <C>
INCOME:
Total Revenues $ 0
----------------
EXPENSES:
Professional Fees $ 1,505
Rent 3,400
Telephone Expense 607
Office Supplies 399
Dues and Subscriptions 925
Advertising 257
Depreciation 1,320
Travel Expense 921
----------------
TOTAL EXPENSES $ 9,334
----------------
NET INCOME (Loss) FOR THE PERIOD (9,334)
ACCUMULATED DEFICIT - December 31, 1996 (338,661)
----------------
ACCUMULATED DEFICIT - MARCH 31, 1996 (347,995)
================
</TABLE>
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REDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Statement of Stockholders' Equity
As of March 31, 1997
<TABLE>
<S> <C>
COMMON STOCK - $.0005 par value
Authorized - 100,000,000 shares
Issued - 45,400,000 shares $ 2,320
CONVERTIBLE PREFERRED STOCK - $.001 par value
Authorized - 10,000,000 shares
Issued - 6,000,000 shares $ 6,000
ADDITIONAL PAID-IN CAPITAL 393,922
ACCUMULATED DEFICIT (403,256)
---------------
STOCKHOLDERS' EQUITY - MARCH 31, 1996 $ 63,581
===============
</TABLE>
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REDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Statement of Cash Flow
For Quarter Ended March 31, 1997
<TABLE>
<S> <C>
CASH FLOW FROM OPERATING ACTIVITIES
Net Income (9,334)
ADJUSTMENT TO RECONCILE NET INCOME TO
NET DEPRECIATION AND AMORTIZATION 1,320
-----------------
NET CASH PROVIDED (Used) BY OPERATION ACTIVITIES (8,014)
-----------------
CASH FLOW FROM FINANCING ACTIVITIES 9,334
NET INCOME (Decrease) IN CASH $ 486
CASH AT BEGINNING OF PERIOD 165
-----------------
CASH AT END OF PERIOD $ 651
-----------------
</TABLE>
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REDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Notes to Financial Statements
March 31, 1997
NOTE 1. NATURE OF BUSINESS
REDOX TECHNOLOGY CORPORATION, was incorporated on April 25, 1988, under the
laws of the State of Delaware. The original name of the corporation was DCUSA
CORPORATION. DCUSA Management referred to the company as a "blind pool" or
"blank check" company. Its primary business was to obtain an acquisition and/or
merger transaction whereby its stockholders would benefit. On June 1, 1993, the
name of the corporation was changed to REDOX TECHNOLOGY CORPORATION. During
1993, the Company acquired a pending patent and all rights thereto which REDOX
Management intends to develop for commercial purposes.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
INCOME TAXES:
The Company is currently operating at a loss. It has therefore not provided for
income taxes.
ORGANIZATION COSTS:
The Company has capitalized the costs of organization and registration of its
securities. Amortization is computed on a straight-line basis over sixty months
commencing April 25, 1988. The Company is no longer amortizing its
organizational cost. These costs will be written off at such time that it may
be determined that the company has been unsuccessful in its efforts to attract
a suitable partner.
NOTE 3. FIXED ASSETS
In January 1994, the Company received furniture and office equipment from Mr.
Richard Szymanski as part of a Sale Contract and Bulk Transfer Agreement
between Mr. Szymanski and the Company. The assets have been recorded in the
books at their fair market value of $25,000.
NOTE 4. PATENT ACQUISITION
On April 9, 1993 the Company acquired all interest in a U.S. Patent Pending
application titled "EMERGENCY RESERVE BATTERY". It involves high density energy
technology to enhance battery cells. The rights to the patent pending were
acquired in exchange for fifteen million (15,000,000) shares of par value .0001
per share, with actual value of the intellectual property so acquired to be
determined by an independent agency. For purpose of financial statements, the
value is shown as $1,500. Management decided to record the property on the
books at the aggregate par value $1,500. The value of this property is computed
at $5,200,000. This value has been determined by Battelle Memorial Institute
which is an independent valuation agency.
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REDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Notes to Financial Statements (Continued)
March 31, 1997
NOTE 5. GOODWILL
This represents amounts paid for the acquisition of Dcusa Corporation by
Richard Szymanski. This is reflected on the books as contribution to Capital
Paid-In.
NOTE 6. COMMON STOCK
On April 9, 1993, the number of outstanding shares of the Company's Common
Stock was increased by fifteen million (15,000,000) shares. These fifteen
million (15,000,000) shares were issued to Richard A. Szymanski in exchange for
assignment of all rights to the pending patent application (See note 4 above).
On June 16, 1993 and July 20, 1993, the Board of Directors of the Company
resolved that a three year common stock purchase stock option be granted to
each of the following individuals:
<TABLE>
<S> <C>
Clifford Jones 50,000 shares
Thomas Poung Au 50,000 shares
Benjamin Botello 100,000 shares
Paul Parshall 50,000 shares
Robert Vickers 50,000 shares
</TABLE>
These options could be exercised by the individuals at their discretion, at any
time within a period of three years by paying the corporation an amount equal
to the par value of $.0001 per share for each share purchased under the option.
Each director listed above has exercised his option.
On June 25, 1993, the Board of Directors approved a one for ten (1:10) reverse
stock split of its common stock. Additionally, on June 13, 1994, the Board of
Directors approved a twenty for one (20:1) forward split of the company's
Common stock, for stockholders of record at June 9, 1994.
On July 1, 1996, the Board of Directors issued a stock option to purchase
1,000,000 shares to C. D. Douglas, said option to be exercised by July 1, 1998.
Said option was exercised by Mr. Douglas.
NOTE 7. ADDITIONAL PAID-IN CAPITAL
The cost of furniture and equipment acquired during the year was $0 (See note
3). The fair market value has been determined at $25,000. The corporation has
decided to record the asset in the books at the fair market value. The
difference between the acquisition cost and the fair market value has therefore
been transferred to additional paid-in capital.
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REDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Notes to Financial Statements (Continued)
March 31, 1997
NOTE 7. ADDITIONAL PAID-IN CAPITAL (Continued)
As of March 31, 1994, the corporation was utilizing capital borrowed from its
principal share holder, Richard A. Szymanski. The principal and interest due on
the note as of December 31, 1993 was $88,358, and the principal and interest
dues as of March 31, 1994 was $120,539 there having been an additional $32,181
accrued during the first quarter 1994. As per an agreement with Mr. Szymanski,
the entire balance due to him was converted to Additional Paid-In Capital. For
all of 1994, that amount was $186,023, there has been $153,842 directly posted
to Additional Paid-In Capital during the second, third, and fourth quarters of
1994, in addition to the $32,181 transferred thereto from the first quarter of
1994. During 1995 an additional $33,212 has been contributed to Additional
Paid-In Capital by Richard A. Szymanski. During 1996 an additional amount of
$85,683 was contributed to Additional Paid-In Capital by Richard Szymanski. For
the three months ending March 31, 1997 an additional amount of $9334 has been
contributed by Richard Szymanski.
NOTE 8. CHANGE OF FISCAL YEAR
On June 16, 1993, the Board of Directors approved the change of fiscal year of
the corporation from beginning on June 1 and ending on May 31, to beginning on
January 1 and ending December 31.
NOTE 9. ALTERATIONS TO PREVIOUS FINANCIAL STATEMENTS FOR THE SAME PERIOD.
The original audited balance sheet as of March 31, 1994 recognized the patent
at its fair market value of $5,200,000 (See note 4), with the corresponding
value assigned to Additional Paid-In Capital. Management decided to revise the
March 31, 1994 financial statement to recognize the patent's value at $1,500,
with corresponding value assigned to Additional Paid-In Capital.
NOTE 10. GOING CONCERN
The accompanying financial statements have been prepared on a going concern
basis, which contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business. Because the Company has not yet
commenced operations, it is entirely dependent upon the continued contributions
of capital and other resources provided by its principals until such time as
sufficient capital can be raised from other sources (e.g. from the sale of the
Company's authorized but unissued Common stock) to commence production for sale
of its products. Therefore, the assumption that the Company is a going concern,
is entirely determined upon the uncertain ability of the Company to raise
capital in such an amount as would be necessary to commence operations and
produce sufficient cash flow therefrom to survive.
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REDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Notes to Financial Statements (Continued)
March 31, 1997
NOTE 11. ADJUSTMENTS TO STOCKHOLDERS' EQUITY ENTRIES
The sum of Two Hundred and Fifty-Five Dollars ($255.00) has been transferred
from Additional Paid-In Capital to Common Stock at Par Value. This has been
done to reflect the par value of all of the Company's Common Stock outstanding.
The sum of Six Thousand Dollars ($6,000.00) has been transferred from
Additional Pain-In Capital to Preferred Stock value. This has been done to
reflect the par value of all of the Company's Preferred Stock outstanding.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
As previously reported, this corporation is in development stage and
has not yet conducted any business so as to become an income producing entity.
The Company continues to utilize capital borrowed from it principal
shareholder, said capital's recognition as or equity contribution is being
negotiated as required.
Management ordered financial statements audited at March 31, 1994 to
include results of a patent valuation report, as management felt that the "fair
market value" of its proprietary technology was appropriate to reflect as an
asset of the Company. The fair market value, as derived from that independent
valuation report was determined to be Five Million Two Hundred Thousand
Dollars, and this value was accordingly posted to Long-term Assets, and to
Additional Paid-in Capital on the Company's Balance Sheet at March 31, 1994.
These values were then carried to the compilations at June 30, 1994 and
September 30, 1994. Subsequently, in consultation with financial, legal and
securities counsels on the matter, management ordered its accountant to
re-audit the financial statements at March 31, 1994, removing the value of
$5,200,000 placed on the patent technology, and replacing it with $1,500 which
was the aggregate par value of the Common Stock which was transferred in
consideration for that technology having been transferred to the Company. This
patent value is now carried on the most recent audited financial statement of
December 31, 1995.
Registrant's financial condition has not changed materially from
December 31, 1996 to the date of the financial statements herewith provided. To
the extent that the Company has incurred continuing expenses without any
revenues having been generated, shareholder's equity would have suffered
proportionately had it not been for the continuing infusion of capital from the
Company director Richard Szymanski. The Notes to the Company's financial
statements, as well as the Independent Auditor's Report, indicate the doubt
about the Company's ability to continue as a going concern without the addition
of financial capital. Because of the absence of revenues and the inability thus
far to raise the capital necessary to commence operations, there are no
assurances that the Company will be able to fully carry out its plans, and
continue as a going concern. However, the principal continues to infuse capital
necessary to maintain the operations of the Company in a non-manufacturing
status while additional capital is being sought.
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PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
Pursuant to a shareholders' meeting, the Board of Directors on July
19, 1996 authorized to increase the Common Shares authorized by the
Corporation from 50,000,000 shares to 100,000,000 shares with a par
value of $.00005.
In addition the Board authorized to create a class of Cumulative
Convertible preferred stock of 10,000,000 shares at a par value of
$.001 per share, convertible at a One to Five (1:5) ratio.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (S 229.30 of this chapter)
None
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934 , the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
REDOX TECHNOLOGY CORPORATION
(Registrant)
DATE: 5/27/97 /s/ RICHARD A. SZYMANSKI
---------------------- -------------------------------------
Richard A. Szymanski
President/Director
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<S> <C>
27 FINANCIAL DATA SCHEDULE
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 651
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 651
<PP&E> 79,454
<DEPRECIATION> (15,838)
<TOTAL-ASSETS> 64,267
<CURRENT-LIABILITIES> 686
<BONDS> 0
0
0
<COMMON> 2,320
<OTHER-SE> 55,261
<TOTAL-LIABILITY-AND-EQUITY> 64,267
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 9,334
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 9,334
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (9,334)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
