<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 1999
Commission File Number: 33-22142
ReDOX TECHNOLOGY CORPORATION
Delaware 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.
CLASS NUMBER OF SHARES OUTSTANDING
ON: June 30, 1999
Common Stock
par value $0.00005 per share 51,680,179
<PAGE> 2
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 September 30, 1999, 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 September 30, 1999
ASSETS
<TABLE>
<S> <C>
Current Assets:
Cash - On Hand $ 723
--------
TOTAL CURRENT ASSETS 723
FIXED ASSETS: (See Note 3)
Net Fixed Assets $ 15,328
--------
TOTAL FIXED ASSETS $ 15,328
--------
OTHER ASSETS:
License Agreement (See Note 12) $ 50,000
Patents (See Note 4) 1,500
Security Deposits 1,159
Organization Costs - Net 250
Goodwill (See Note 5) $ 50,000
--------
TOTAL OTHER ASSETS $102,909
--------
TOTAL ASSETS $118,960
========
</TABLE>
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ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Balance Sheet
As of September 30, 1999
LIABILITIES AND SHAREHOLDERS' EQUITY
<TABLE>
<S> <C>
CURRENT LIABILITIES:
Accounts Payable $ 12,575
---------
STOCKHOLDERS' EQUITY:
Common Stock, par value $.00005 per share
100,000,000 authorized. 51,680,179 issued and
outstanding (See note 6 and 11) $ 3,285
Convertible Preferred Stock, par value $.001
10,000,000 shares authorized. 5,000,000 shares
issued and outstanding $ 5,000
Additional Paid-in Capitol (See note 6 and 11) $ 862,701
Accumulated Deficit - September 30, 1999 (764,601)
---------
TOTAL STOCKHOLDERS EQUITY $ 106,385
---------
TOTAL LIABILITIES AND EQUITY $ 118,960
=========
</TABLE>
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ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Statement of Income and Retained Earning
For the Nine Months Ending September 30, 1999
<TABLE>
<S> <C>
INCOME:
Total Revenues $ 0
---------
EXPENSES:
Professional Fees $ 35,050
Rent 33,492
Telephone Expense 13,494
Office Expense 5,894
Taxes 1,933
Public Relations 6,614
Depreciation 5,400
Auto Expense 2,955
Travel & Entertainment Expense 114,799
TOTAL EXPENSES $ 219,631
---------
NET INCOME (Loss) FOR THE PERIOD (219,631)
---------
ACCUMULATED DEFICIT - January 1, 1999 (544,970)
---------
ACCUMULATED DEFICIT - SEPTEMBER 30, 1999 (764,601)
=========
</TABLE>
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ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Statement of Stockholders' Equity
As of September 30, 1999
<TABLE>
<S> <C>
COMMON STOCK - $.0005 par value
Authorized - 100,000,000 shares
Issued - 51,680,179 shares $ 3,285
CONVERTIBLE PREFERRED STOCK - $.001 par value
Authorized - 10,000,000 shares
Issued - 5,000,000 shares $ 5,000
ADDITIONAL PAID-IN CAPITAL $ 652,009
ACCUMULATED DEFICIT- January 1, 1999 (544,970)
---------
STOCKHOLDERS' EQUITY - January 1, 1999 $ 115,324
ADDITIONAL PAID IN CAPITAL (See Note 7) $ 201,692
NET PROFIT & LOSS FOR THE PERIOD
JANUARY 1, 1999 - September 30, 1999 $(219,631)
---------
Total Stockholders Equity $ 106,385
=========
</TABLE>
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ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Statement of Cash Flow
For Period Ending September 30, 1999
<TABLE>
<S> <C>
CASH FLOW FROM OPERATING ACTIVITIES
Net Income $(219,631)
ADJUSTMENT TO RECONCILE NET INCOME TO
NET CASH PROVIDED BY OPERATING ACTIVITIES
DEPRECIATION & AMORTIZATION $ 5,400
INCREASE (DECREASE) IN ACCOUNTS PAYABLE $ 5,521
---------
TOTAL ADJUSTMENTS $ (10,921)
---------
NET CASH PROVIDED (USED BY OPERATING ACTIVITIES) $ (10,921)
CASH FLOW FROM FINANCING ACTIVITIES $ 208,710
NET INCOME (Decrease) IN CASH $ 210,893
CASH AT BEGINNING OF PERIOD 537
---------
CASH AT END OF PERIOD $ 723
=========
</TABLE>
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ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Notes to Financial Statements
September 30, 1999
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. On August 18, 1997, Redox executed and
exclusive agreement with Clark University, an option to elect a royalty bearing,
limited terms, license to the Patent Rights in the novel Aluminum-Sulfur Battery
developed by Stuart Licht at Clark University.
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ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Notes to Financial Statements (Continued)
September 30, 1999
NOTE 4. PATENT ACQUISITION - (CONTINUED)
Such exclusivity to apply to the electronics industry and for space
applications. The company paid fifty thousand dollars ($50,000) for the
exclusive use of these patents for the electronics and space application. The
company will pay a royalty to Clark University on products sold as a result of
using the technology.
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).
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.
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
$80,636 has been contributed to Additional Paid-in Capital b Richard Szymanski.
For the year ending December 31, 1997 and additional amount of $ 89,457 has been
contributed by Richard Szymanski.
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ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Notes to Financial Statements (Continued)
September 30, 1999
NOTE 7. ADDITIONAL PAID-IN CAPITAL - (CONTINUED)
For the year ending December 31, 1998 an additional amount of $ 173,662, has
been contributed by the same party. For the months ending September 30, 1999 an
additional amount of $ 210,693 has been contributed by the same party.
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 there from to survive.
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 ($5,000.00) has been transferred from Additional
Paid-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, 1998 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
Cause No. 1999-19,667; Larry Bell and Valery K. Aksamentov vs.
ReDOX Technology Corporation and Richard Szymanski in the District
Court of Harris County, Texas 133rd Judicial District.
This lawsuit, filed in 1999, involves a purported agreement
between the Plaintiff's and Defendants, which has never been ratified
or accepted by the Corporation. The corporation is of the opinion that
the litigation has no merit and will have to be litigated.
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (S 229.30 of this chapter)
None
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ITEMS REPORTED
ITEM 1. ACQUISITION/DISPOSITION OF ASSETS
None
ITEM 2. APPOINTMENT OF RECEIVER
None
ITEM 3. REGISTRANT/DISMISSAL OF CPA
None
ITEM 4. RESIGNATION OF DIRECTOR WITH DISAGREEMENT
None
ITEM 5. OTHER MATERIAL MATTERS
None
Page 13
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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: November 15, 1999 /s/ RICHARD A. SZYMANSKI
---------------------------- ----------------------------------------
Richard A. Szymanski
President/Director
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------ -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 723
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 723
<PP&E> 152,495
<DEPRECIATION> (34,258)
<TOTAL-ASSETS> 118,960
<CURRENT-LIABILITIES> 12,575
<BONDS> 0
0
5,000
<COMMON> 3,285
<OTHER-SE> 98,100
<TOTAL-LIABILITY-AND-EQUITY> 118,960
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 219,631
<LOSS-PROVISION> (219,631)
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (219,631)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (219,631)
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
