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, 2000
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.
CLASS NUMBER OF SHARES OUTSTANDING
ON: September 30, 2000
Common Stock
par value $0.00005 per share 49,600,478
<PAGE>
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, 2000, 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.
<PAGE>
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Balance Sheet
as of September 30,2000
ASSETS
<TABLE>
<CAPTION>
Current Assets:
<S> <C>
Cash - On Hand $ 542
--------
TOTAL CURRENT ASSETS $ 542
--------
FIXED ASSETS: (See Note 3)
Net Fixed Assests $ 18,978
---------
TOTAL FIXED ASSETS $ 18,978
---------
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 $122,429
========
</TABLE>
<PAGE>
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Balance Sheet
as of September 30, 2000
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts Payable $ 20,881
Notes Payable - Stockholder $ 1,080,712
--------------
TOTAL CURRENT LIABILITIES: $ 1,101,593
--------------
STOCKHOLDERS' EQUITY:
Common Stock, par value $.00005 per share
50,000,000 authorized. 49,600,478 issued and
outstanding. (See note 6, 11, and 12) $ 2,480
Convertible Preferred Stock, par value $.001
10,000,000 shares authorized. No shares
issued and outstanding. $ -0-
Additional Paid-in Capitol (See note 6 and 11) $ 107,944
Accumulated Deficit
September 30, 2000 $ ( 1,089,588)
--------------
TOTAL STOCKHOLDERS EQUITY OR DEFICIT $ ( 979,164)
--------------
TOTAL LIABILITIES AND EQUITY $ 122,429
==============
<PAGE>
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Statement of Income and Retained Earning
for The Nine Months Ending September 30, 2000
INCOME:
Total Revenues $ -0-
EXPENSES:
Insurance Expense $ 867
Professional Fees 52,320
Rent 25,656
Telephone Expense 13,863
Office Expense 7,561
Taxes 615
Public Relations 20,302
Depreciation 4,800
Auto Expense 923
Travel & Entertainment Expense 55,075
Dues and Subscriptions 699
Royalty Expense 35,000
----------
TOTAL EXPENSES $ 217,681
------------
NET INCOME (Loss) FOR THE PERIOD $ (217,681)
ACCUMULATED DEFICIT - January 1, 2000 $ (871,907)
------------
ACCUMULATED DEFICIT - September 30, 2000 $(1,089,588)
=============
<PAGE>
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Statement of Stockholders' Equity
As of September 30, 2000
COMMON STOCK - $.0005 par value
Authorized - 50,000,000 shares
Issued - 49,600,478 shares $ 2,480
CONVERTIBLE PREFERRED STOCK - $.001 par value
Authorized - 10,000,000 shares
Issued - 0 shares $ -0-
ADDITIONAL PAID-IN CAPITAL - See Note 7 $ 107,944
ACCUMULATED DEFICIT $ (1,089,588)
-------------
TOTAL STOCKHOLDERS EQUITY $ (979,164)
-------------
<PAGE>
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Statement of Cash Flow
For Period Ending September 30, 2000
CASH FLOW FROM OPERATING ACTIVITIES
Net Income $ (217,681)
ADJUSTMENT TO RECONCILE NET INCOME TO
NET CASH PROVIDED BY OPERATING ACTIVITIES
DEPRECIATION & AMORTIZATION $ 4,800
INCREASE (DECREASE IN ACCOUNTS PAYABLE $ 4,862
----------
TOTAL ADJUSTMENTS $ 9,662
----------
NET CASH PROVIDED (USED BY OPERATING ACTIVITIES) $ (208,019)
CASH FLOW FROM FINANCING ACTIVITIES $ 209,386
NET INCREASE (Decrease) IN CASH $ 1,367
CASH AT BEGINNING OF PERIOD $ 825
----------
CASH AT END OF PERIOD $ 542
==========
<PAGE>
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Notes to Financial Statements
September 30, 2000
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.
<PAGE>
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Notes to Financial Statements (Continued)
September 30, 2000
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. The company has paid a minimum annual royalty to Clark
University of $35,000.
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 following is a recap of capital borrowed from its principal shareholder,
Richard Szymanski.
Period Ending Amount
12-31-93 $ 88,358
12-31-94 186,023
12-31-95 67,633
12-31-96 130,636
12-31-97 89,457
12-31-98 173,662
12-31-99 238,581
06-30-0 106,362
09-30-0 107,944
----------
TOTAL $1,188,656
Less: Amount converted to Note Payable - Richard Szymanski
As of June 30, 2000 $(1,080,712)
--------------
BALANCE - September 30, 2000 $ 107,944
-------------
<PAGE>
ReDOX TECHNOLOGY CORPORATION
(Formerly DCUSA Corporation)
Notes to Financial Statements (Continued)
September 30, 2000
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.
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. As of
June 30,2000 an adjustment of $805.00 was made to common stock to reflect the
shares outstanding per audit by Transfer Agent. This was transferred to paid-in
capital.
The sum of Five 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.
Pursuant to a Board of Directors resolution on July 14, 2000, the 5,000,000
shares of converted preferred stock was cancelled and returned to the treasury.
The sum of $5,000.00 has been transferred to paid-in-surplus.
Note 12.
The outstanding shares of common stock have been adjusted to agree with stock
transfer agent's records.
<PAGE>
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, 1999.
Registrant's financial condition has changed materially from December
31, 1999 to the date of the financial statements herewith provided. On August
14,2000 the company executed a promissory note to Richard Szymanski in the
amount of $1,080,712 which covers amount of funds that have been advanced to the
company by Richard Szymanski from 1993 thru June 30,2000. Upon the stockholders
approval of the purposed amendment to increase the authorized common stock, the
note will be exchanged for 11,937,311 shares of common stock until the debt is
converted to common stock the company will have a negative net worth. 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.
<PAGE>
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
The 5,000,000 shares of convertible preferred stock was cancelled and
returned to the treasury per Board of Directors resolution dated July
14,2000.
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
<PAGE>
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>
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 13, 2000 /s/ Richard A. Szymanski
----------------- ------------------------
Richard A. Szymanski
President/Director
