U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                   FORM 10-KSB


[X]      ANNUAL REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
         ACT OF 1934

         For the FISCAL YEAR ended, March 31, 1997

                                       OR

[  ]     TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
                                  ACT OF 1934

                          Commission File Number 0-9459

                               NUMEX CORPORATION 
             (Exact name of Registrant as specified in its charter)

           Delaware                                       06-1034587  
(State or Other  Jurisdiction  of      I.R.S.  Employer Identification  Number)
Incorporation or Organization)  

14115 S. Pontlavoy Ave. Santa Fe Springs,  CA                            90670
(Address of Principal  Executive Offices)                             (Zip Code)
                                 (562) 404-7176
                (Issuer's Telephone Number, Including Area Code)

     Check whether the registrant: (1) filed all reports required to be filed by
Section 13 or 15 (d) of the Securities Act of 1934 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 

Check if disclosure of delinquent filers in response to item 405 of Regulation 
S-B is not contained in this form, and no disclosure will be contained, to the
best of the registrant's knoledge, in definitive proxy or information statements
incorporated by refernece in Part III of this

Form 10-KSB or any amendment to this Form 10-KSB X

Revenues for the fiscal year ended March 31, 1997 were $296,357.

The aggregate market value of the voting stock held by non-affiliates of the 
registrant as of March 31, 1997, amounted to approximately $2,175,591.

Registrant  had 5,967,750  shares of its common  stock,  $.10 par value,and
170,000 of Preferred Stock, $1.00 par value outstanding at March 31, 1997.

Traditional Small Business Disclosure Format (check one): Yes X No
<PAGE>
PART I.  ITEM  1.  DESCRIPTION  OF  BUSINESS

General   Development

     Numex  Corporation,   ("Registrant")  was  organized  and  incorporated  in
Delaware on August 1, 1980.  Registrant,  through a wholly owned  subsidiary was
engaged in the  remanufacturing and servicing of metal cutting machine tools and
the  retrofitting  of such  tools  with new  electronic  controls.  Registrant's
operations were substantially  eliminated during fiscal year 1988, and from that
time until January 1991, Registrant was not an operating company.

     In January 1991,  Registrant acquired certain assets of Delux Distributions
International,  Inc.  ("DDI").  Since  that  acquisition,  Registrant  has  been
operating as the manufacturer,  through  subcontractors,  and the distributor of
its primary  product known as Therapy Plus, a hand-held  massage device used for
the relief of muscular pain.

     In June  1994,  Registrant  acquired  ViaStar  Marketing,  Inc.,  a Florida
corporation organized in December 1993 ("ViaStar Florida"), by means of a merger
of ViaStar Florida into Airmotive  Acquisitions,  Inc., a Delaware  corporation,
and a wholly owned  subsidiary of Registrant  since April 1994. Upon the merger,
Airmotive  Acquisitions,  Inc.,  which  had  previously  not  been an  operating
company,  changed its name to ViaStar  Marketing,  Inc., a Delaware  corporation
("ViaStar").  ViaStar is a wholly owned subsidiary of Registrant. ViaStar was in
the business of outbound  telemarketing of celebrity owned or endorsed products.
ViaStar was not  profitable,  and an assignment for the benefit of creditors was
made of its assets (subject to liabilities) on July 31, 1995.

     Subsequently, on March 26, 1997, in the Circuit Court of the Sixth Judicial
Circuit in and for Pineallas County, Florida, Case No. 95-00493-CI-19  regarding
ViaStar Marketing,  Inc. (the "Assignor") v. Michael E. Moecker (the "Assignee")
the court issued an order on Assignee's  Final Report and Petition for Discharge
of Assignee and Release of Bond,  and  discharged  the Assignee from any further
obligations and released the Assignee's bond.

Acquisition of Therapy Plus

     On January 2, 1991,  Registrant  acquired certain assets of DDI pursuant to
an Asset Purchase Agreement dated December 3, 1990 (the  "Agreement").  DDI also
assigned to  Registrant  all of its rights under  certain  agreements  which DDI
entered  into  with  third  parties  relating  to  the  advertising,   sale  and
distribution  of a product known as Dermapoints,  and Registrant  assumed all of
DDI's obligations under such agreements.

     The assets  purchased  included the inventory of two models of a hand-held,
non-electric,  mechanical,  patterned  cutaneous nerve stimulator sold under the
trade name of Dermapoints Model 100 and Dermapoints Model 200 (collectively, the
"Product"). Since acquiring the Product, Registrant has changed the Product name
to "Therapy  Plus."  Registrant  also  acquired  all of DDI's  right,  title and
interest in all assets and  property  used by DDI in the  manufacture,  sale and
distribution of the Product.

Therapy Plus

     The  Product is a patented  non-electric,  cylinder-shaped  pain  relieving
device comprised of a series of starwheels, mounted on a shaft, with hundreds of
points  which do not  puncture  the  surface of the skin.  The Product is rolled

<PAGE>
briskly over the painful areas of the body for three to eight minutes.  The sale
of the Product is permitted under a 510(k)  registration  with the Food and Drug
Administration  (the "FDA") which  authorizes the following claims to be made in
connection with the Product:  Provides  temporary  relief of minor muscular pain
associated  with arthritis;  "Temporarily  relieves pain from  overexertion  and
fatigue.  Increases  blood  circulation.  Relaxes  tense  muscles."  The Product
produces the therapeutic effect of a massage.

     Following  the  acquisition  of  the  Product,  and  through  August  1992,
Registrant engaged in a major marketing campaign,  selling the Product primarily
through  "infomercials"  on  television.  An  "infomercial"  is a half-hour paid
television  program  whose  primary  purpose  is to sell  one or more  products.
Television  advertising  time was purchased by  Registrant  through both its own
employees  and  independent   buyers  of  airtime.   Registrant   broadcast  its
infomercial entitled "Freedom From Pain" (the "Infomercial") daily on television
stations  throughout the United States.  Viewers could either call the toll-free
800 phone number given in the Infomercial to order the Product or could purchase
the Product by mail from  Registrant.  Orders  generated by the Infomercial were
filled by  Registrant  within  one to five  working  days from its  facility  in
Cerritos, California.

     Subsequent  to  August  1992,  Registrant  discontinued  the  airing of the
Infomercial as a result of an investigation by the Federal Trade Commission (the
"FTC").  The FTC  claimed  among  other  things  that  Registrant's  Infomercial
contained certain advertising claims which Registrant had not substantiated with
sufficient  scientific evidence.  In response during 1993 Registrant sponsored a
well controlled clinical study at an independent  hospital and in November 1993,
the Company  submitted a 510 (k)  notification to the FDA advisory agency of the
Company's  intention  to add the  word  arthritis  to its  labeling  claims.  In
February 1996, the Company received an FDA  notification  that the Product could
be  marketed as a  "Temporary  relief of minor  muscular  pain  associated  with
arthritis".

     During  late  July  through  November  1996,   Registrant  produced  a  new
infomercial and commenced media tests and resumed  marketing Therapy Plus in the
United  States,  using the newly accepted  claims by the  government  regulatory
agency,  regarding arthritis pain. The efforts were not successful.  The primary
reason for the  unsuccessful  media  attempt was the  substantial  higher  media
costs.

Manufacturing

     The Product has been manufactured for Registrant by unaffiliated  companies
in conformity with Registrant's instructions and specifications. These companies
have no  right,  title  or  interest  in or to the  Product  and  serve  only as
Registrant's  subcontractors  to manufacture the Product.  To Registrant's  best
knowledge,  all  of the  materials  used  in  making  the  Product  are  readily
available. Registrant is not dependent on its current manufacturers with respect
to tools, plans and specifications  since they are owned by Registrant.  If, for
some reason,  Registrant's current  manufacturers were unable to continue making
the Product,  Registrant would take the tools, plans and specifications to other
manufacturing subcontractors.

Product Distribution and Customer Service

     All orders of the  Product  are  shipped  to  customers  from  Registrant's
facilities in Santa Fe Springs, California. Registrant's employees are available
to  respond to  customer  questions  and  complaints,  and  offers a  thirty-day
unconditional  money back  guarantee  on retail  sales in addition to a one-year
guarantee against defects in the Product.

Trademarks, Licenses, and Patents and Royalty Agreements

     The name  "Therapy  Plus" is a  trademark  of  Registrant.  The Product was
formerly marketed,  briefly,  under the name  "Dermapoints."  After Registrant's

<PAGE>
acquisition  of the  Product,  it made a minimal  number of sales of the Product
under the name  "Dermapoints",  and  thereafter  changed the  Product's  name to
"Therapy Plus."

     The inventor of the Product obtained a United States patent for the Product
in  February  1991.  Registrant  and the  patent  owner  entered  into a license
agreement (the "License Agreement") as of January 1, 1992. The License Agreement
grants to Registrant an exclusive  license to market,  manufacture  and sell the
Product  in the  United  States  and its  possessions  and  territories  for the
remaining life of the patent, which is currently eleven years.  Thereafter,  the
design of the Product  will be in the public  domain and  Registrant  as well as
other companies will have the right to market, manufacture and sell the Product.

     As a condition  for obtaining the License  Agreement,  Registrant  paid the
patent owner a one-time  license fee of $120,000.  This payment was made in June
1992 and was capitalized as an intangible asset. On March 31, 1997 the remaining
value of the license fee and related  expenses  were  written  off.  The License
Agreement  also  provides for  royalties at a rate ranging from $.50 per unit to
$1.20 per unit depending on the method of distribution used.

     At March  31,  1997,  Registrant  owed the  patent  owner an  aggregate  of
$355,518 in accrued royalties,  consisting of $544 relating to fiscal year 1997,
$5,744 relating to fiscal year 1996 sales,  $18,073 relating to fiscal year 1995
sales,  $13,895  relating to fiscal year 1994 sales,  $76,962 relating to fiscal
year 1993 sales and minimum calendar year royalty requirements  relating to 1997
& 1994 for  $124,181  and  $116,119  respectively.  Per the terms of the License
Agreement,  however, Registrant's position is that per the Licensee Registrant's
obligation to pay the minimum and accrued royalties are stayed due to government
intervention  into the marketing of the product (see  Government  Regulation) as
provided for in the license agreement.

Customers

     The Product is currently  being sold primarily to the general public either
through  wholesalers  and  export  distributors.  The  target  purchaser  is any
individual who experiences muscular pain.

Backlog Orders

     There is no current backlog of sales orders.


Competition

     Significant  competition  exists in the pain relief market as a whole. Most
of  Registrant's  competition  in the general pain relief  market is from pills,
creams and ointments. Competition from companies selling medical devices is more
limited.  Registrant is aware of several hand-held devices that are designed for
purposes of massage,  but is unaware of any other such  devices  legally sold in
the United States for the relief of pain associated with arthritis.

Government Regulation

     On January 29, 1996 the FDA  approved  the 510 (k)  premarket  notification
filed by the  Company in  November  1993  based on a  clinical  study by a major
hospital.  The submission of this study and its  subsequent  approval by the FDA
allows the Company to make claims in relieving pain associated with arthritis.
<PAGE>
Employees

     As of March 31,  1997,  Registrant  employed 2  full-time  employees  and 1
part-time  employee.  These  employees  performed  services  in  administration,
marketing,  order  processing,   shipping,   customer  service  and  accounting.
Registrant  believes it is on good terms with its employees and does not foresee
any labor difficulties in the future.

Acquisition of ViaStar Marketing, Inc.

     In June  1994  Registrant  acquired  ViaStar  Marketing,  Inc.,  a  Florida
corporation  ("ViaStar  Florida"),  by means of a merger of ViaStar Florida with
and into Airmotive Acquisitions,  Inc., a Delaware corporation ("Airmotive") and
a wholly-owned subsidiary of Registrant. Concurrent therewith, Airmotive changed
its name to ViaStar Marketing,  Inc., a Delaware corporation ("ViaStar").  Prior
to the merger, Airmotive was not an operating company.

     ViaStar  Florida,  which was incorporated in November 1993, was acquired by
Registrant pursuant to the terms of an agreement dated June 3, 1994 by and among
Registrant,  ViaStar Florida,  Airmotive, Jack Salzberg,  William Lovell, George
Simone and Robert Circosta (the "Acquisition Agreement").

     Pursuant to the Acquisition  Agreement the shareholders of ViaStar Florida,
Messrs.  William Lovell,  Robert Circosta and George Simone, at the closing, and
in accordance with the plan of merger of ViaStar Florida into ViaStar,  received
an aggregate of 1,000,000  shares of the common stock of  Registrant in exchange
for all of the  issued  and  outstanding  shares  of  ViaStar  Florida.  ViaStar
Florida's  significant  assets  consisted of two licensing  agreements  with two
nationally  recognized  celebrities to market and distribute  these  celebrities
owned or endorsed products.

     Subject to ViaStar's  Marketing , Inc.  achieving  certain  earnings goals,
500,000 of the shares  issued to ViaStar  Florida  are being held in escrow (the
"Escrow Shares").  The Acquisition Agreement provided that if the cumulative net
income of ViaStar did not aggregate  $900,000  prior to March 31, 1997,  one and
eleven one hundredths  (1.11) Escrow Shares would be released for each dollar of
cumulative  net income  over  $450,000 at March 31,  1997.  The  acquisition  of
ViaStar was an arm's length  transaction and the consideration was arrived at by
good faith negotiation between the parties.

     Mr. Lovell entered into a three year  employment  agreement with ViaStar to
be its President;  Mr. Circosta  entered into a three year employment  agreement
with ViaStar to be its Executive Vice President,  and George Simone entered into
a three year  consulting  contract  with ViaStar to provide  certain  consulting
services.  Pursuant  to the  terms  of the  two  employment  agreements  and the
consulting contract,  Messrs.  Lovell,  Circosta and Simone would receive a base
salary of  $125,000  per year and  bonuses  out of a bonus pool  established  by
ViaStar.  Additionally,  these agreements entitled Messrs. Lovell,  Circosta and
Simone to earn options to acquire up to an aggregate of  1,000,000,  500,000 and
500,000  additional  shares of  Registrant's  common  stock,  respectively.  The
options  were to vest in  increments  based on  ViaStar's  achieving  particular
performance goals by specific dates as set forth in the Acquisition Agreement.
 
     During  fiscal year 1995 ViaStar was engaged in outbound  telemarketing  of
celebrity  owned or  endorsed  products  and the  initiation  of a direct  sales
representative program for such products. ViaStar was a party to a licensing and
distribution   agreement  with  a  nationally   recognized   celebrity  for  the
distribution of existing owned or endorsed  products that are already selling on
national television by means of live direct response television.

     In February 1995 Mr. George Simone  resigned as a director of ViaStar,  and
his  consulting  contract,  including  stock  options,  was terminated by mutual
consent.  Mr.  Simone  received no  consulting  fees for his services  under the
<PAGE>
contract.  ViaStar and Mr. Simone also signed mutual general  releases.  In June
1995, Messrs. Lovell and Circosta resigned as directors,  officers and employees
of ViaStar and the business essentially ceased operations shortly thereafter.

     By July 31, 1995 ViaStar had exhausted  the capital  provided by its parent
and an  assignment  for the benefit of ViaStar's  creditors was made on July 31,
1995 pursuant to Chapter 727 of the Florida State Statutes.

     Subsequently, on March 26, 1997, in the Circuit Court of the Sixth Judicial
Circuit in and for Pinellas County, Florida, Case No. 95-00493-CI-19  regarding
ViaStar Marketing,  Inc. (the "Assignor") v. Michael E. Moecker (the "Assignee")
the court issued an order on Assignee's  Final Report and Petition for Discharge
of Assignee and Release of Bond,  and  discharged  the Assignee from any further
obligations and released the Assignee's bond.

     On March 28, 1997 a Certificate of Dissolution was filed with the Secretary
of State of Delaware authorizing the dissolution of ViaStar Marketing, Inc.

ViaStar - Release of Escrow Shares

     Further to the "Acquisition of ViaStar Marketing,  Inc.". as written above,
on the June 6, 1994 there was an Escrow  Agreement  made between Numex and three
directors  of ViaStar  Marketing,  which  provided  for 500,000  shares of Numex
common stock to be issued to them. The Escrowed Shares were placed under certain
financial  conditions.  The  financial  goals  were  never  met by  the  ViaStar
directors.  Numex's Counsel, as Escrow Agent, held the Escrowed shares, and now,
in accordance with the terms of the agreement, has released the Escrow Shares to
Numex as of March 31,  1997.  Upon the  Company's  instruction  the shares  were
placed into the Company's treasury stock with the Company's Transfer Agent.

ITEM 2.  PROPERTIES

Registrant operated from one facility during fiscal year 1997 as follows:

     14115 South Pontlavoy Avenue, Santa Fe Springs, California 90670

     Numex moved into its current  location on February 1, 1995.  The new office
space is used for  general  office  space,  customer  service  and  shipment  of
Product,  and until July  1995,  was used to provide  fulfillment  services  for
ViaStar.   The  facility  contains  12,460  square  feet,   including   shipping
facilities.  The  monthly  rental  is $5,732  plus  taxes,  insurance  and other
maintenance  costs.  Registrant  occupies this facility under a three-year lease
which expires in January 31, 1998. The Company also subleases a certain  section
of the space for $2,250 per month.

ITEM 3.  LEGAL PROCEEDINGS


Financial Advertising Services,  Inc., etc. v. Numex Corporation,  Etc., et
al LASC Case No. BC 162019

     As previously  reported in the  Registrant's  10-Q filed December 31, 1996,
the litigation known as Financial Advertising Services,  Inc. d.b.a. FMS Direct,
a California  Corporation  ("FMS") (the "Plaintiff").  v. Numex  Corporation,  a
Delaware Corporation (the "Company") (the "Defendants"), et al. was filed in the
Superior  Court of the State of  California  for the County of Los  Angeles,  on
December 5, 1996.  The action  alleged that the  supplier,  FMS, and the Company
entered into an agreement dated March 21, 1996, (the  "Agreement")  and pursuant
to the  Agreement,  FMS was seeking  $20,000 in  accordance  with  paragraph 5.5
Additional Payments.
<PAGE>
     Subsequently, the lawsuit filed against Registrant by Financial Advertising
Services,  Inc.  has  been  settled.   Pursuant  to  the  Settlement  Agreement,
Registrant is required to pay FMS $20,000,  payable $3,000 on April 15, 1997 and
$1,545.45 per month for eleven months thereafter.

Belin Rawlings & Badal LLP and Numex Corporation and Jack I. Salzberg American
 Arbitration Association RE:72 194 01200 96

     On December 6, 1997 Belin  Rawlings & Badal LLP (the  "Claimants")  filed a
Demand  for  Arbitration  before  the  American  Arbitration  Association  in  a
proceeding  entitled In the Matter of the  Arbitration  between Belin Rawlings &
Badal LLP, and Numex Corporation and Jack I. Salzberg (the "Respondents")  (Case
No.  72  194  01200  9)  (the  "Proceeding").  The  proceeding  arose  out of an
allegation  by the Claimants  that  pursuant to a Promissory  Note and Agreement
dated June 28, 1994 (the  "Agreement") by and between Belin Rawlings & Badal LLP
and  Numex  Corporation  and Mr.  Salzberg,  the  Respondents  failed to meet an
obligation to pay an unpaid principal in the amount of $151,000.

     Subsequently, on May 15, 1997, the American Arbitration Association awarded
to the  Claimants,Belin  Rawlings & Badall LLP a total amount of $208,778,  plus
interest, at the rate of 10% per annum from May 6, 1997.

     Discussions  are  currently  being held by the Company and the Plaintiff to
convert this amount into common stock of the Company.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     On April 1, 1996 by Written Consent of stockholders on owning a majority of
the issued and outstanding shares of Common Stock of the Company,  Article IV of
the Certificate of  Incorporation  was amended to authorize the Company to issue
ten million (10,000,000) shares of Preferred Stock with a par value of $1.00, in
lieu of the one hundred  thousand  (100,000)  shares with a par value of $100.00
previously authorized and as reported on Registrant's 10-Q June 30, 1996.

                              PART II.


ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     Registrant's  stock is traded in the over the counter market. The following
table  sets forth the range of high and low bid and ask  quotations  for each of
the fiscal  quarters for the years ending March 31, 1996 and March 31, 1997,  as
reported by the National Quotation Bureau, Inc.


Fiscal Year Ended                     Range of Bid/Ask Quotes
                                     High                 Low
March 31, 1996                   Bid     Ask          Bid    Ask
First Quarter                    1/2    1 1/8         1/8    5/8
Second Quarter                   7/16   15/16         1/4    9/16
Third Quarter                    7/16   15/16         1/4    9/16
Fourth Quarter                   1/2      1           1/4    5/8

March 31, 1997
First Quarter                    5/8    15/16         7/16   11/16
Second Quarter                   5/8    15/16         3/8    9/16
Third Quarter                    1/2    3/4           3/8    5/8
Fourth Quarter                   19/32  11/16         3/8    5/8

<PAGE>
     The above  quotations  represent  prices between dealers and do not include
retail markup, markdown or commission, and do not represent actual transactions.

     As of March 31, 1997 there were approximately 430 shareholders of record of
Registrant's Common Stock. This number does not reflect individual  participants
in security position listings held in "street name" accounts.

     Registrant  has not paid any cash or stock  dividends  on its common  stock
since its incorporation and anticipates  that, for the foreseeable  future,  any
earnings will be retained for use in Registrant's business.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS


Results of Operations

     Net sales during  fiscal year 1997 were  $296,000 as compared to $1,023,000
during fiscal year 1996. Of the last year's net sales, $601,000 is the result of
ViaStar's four months  operation.  The 30% net decrease in Numex sales from last
year's $422,000 represents the combination of $24,000 increase in consumer sales
as a result  of the  Therapy  Plus new  infomercial  and  $150,000  decrease  in
wholesale sales.

     Numex cost of sales as a percentage of net sales  increased from 45% during
the fiscal year 1996 to 52% during the fiscal year 1997.  The net  increase  was
primarily due to write offs of slow moving  inventories.  ViaStar's  portion for
the year 1996 was $365,000.

     Selling,  general and administrative  expenses during fiscal year 1997 were
$653,000,  as compared to  $864,000  during the prior year of which  $422,000 is
ViaStar's.  Current year's expenses  consists of 20% video production costs, 19%
royalty  requirement and 61% normal operating  expenses The 52% overall increase
was  primarily  due to the new video  production  cost and royalty  requirement.
Otherwise,  10% decrease  compared to prior year's $442,000 in normal  operating
costs was due to effective cost cutting measures.

     The Licensing  Agreement the Company entered into with the German inventor,
had a  provision  in it  that if the  operations  of  Numex  are  halted  by any
government agency or action,  that the minimum license fee of $125,000 per annum
would be stayed.

     In February 1992 the Company  signed a consent order from the Federal Trade
Commission  "FTC",  which  prohibited  the Company from making or using  certain
claims or  endorsements,  which had  previously  proven  extremely  effective in
marketing  the  Product.  After a 3 year  clinical  study,  the  Food  and  Drug
Administration  ("FDA") gave the Company  permission  to market the Therapy Plus
Product using only a limited number of the original claims and endorsements.

     Consequently the new and revised infomercials, using the limited claims and
endorsements, allowed by the FDA tested below expectations and the media testing
was  discontinued.  The  discontinuance of the airing of the infomercial for all
practical purposes, took away the momentum of the sales equal to 98%.
<PAGE>
     In February  1996,  the FDA approval  became totally moot for the following
two reasons:

     1.  Momentum  had been lost.
     2.  The cost of the media  airtime  during the interim had gone up several
         fold,  causing the company to abandon the testing of the new
         infomercial in November and December 1996.

     Accordingly,  Management's  opinion of the $125,000  minimum license fee is
that it need not be paid because it is an outcome of the same government  agency
action causing the Company to abandon its marketing program.

     Therefore,  it is Management's  humble opinion that the liabilities related
to actual sales should be the only one recognized in the books for $115,000.

     Net loss from operations  during the fiscal year 1997 was $512,000 compared
to $399,000 in fiscal year 1996.  For fiscal 1996,  ViaStar's  loss was $186,000
and Numex loss was $213,000.

     Net interest  expense  during  fiscal year 1997 and 1996 were  $204,000 and
$183,000.  Of the 1996 interest  expense  $2,000 was ViaStar and  $181,000.  The
increase  in Numex  current  year's  interest  expense  which  was to  increased
borrowings to continue ongoing operations.

     Other income Numex for fiscal year 1997 and 1996 were $41,000 and $219,000.
For the fiscal year 1997,  $30,000 were from product liability  insurance refund
and cost recoveries and $11,000 reversal of accrued expenses.


Financial Condition, Liquidity and Capital Resources

     Net  cash  used  in  operations  during  fiscal  year  1997  was  $204,000.
Registrant  funded this usage from notes payable  proceeds and sale of preferred
stock which  resulted in net cash flows from  financing  activities of $225,000.
Cash used for operating activities exceeded cash generated by operating revenues
as a result  of low sales  volumes  which  were not  adequate  to cover  minimum
overhead costs.

     Registrant's  liquidity is negatively affected by Registrant's  current low
sales volumes and its debt  maturities.  However,  Registrant  believes that, if
necessary,  it would be  successful in either  extending  the maturity  dates on
certain debt  obligations,  in aggregate of $631,000 as they mature or obtaining
new debt  financing to retire  existing  debt as it matures.  At March 31, 1997,
Registrant's  Chairman of the Board converted  $300,000 of notes payable due him
into common stock at the rate of $1.00 per share.

     Because Registrant's liquid assets are currently  insufficient to meet cash
requirements  of its ongoing  operations,  Registrant  plans to continue to rely
upon external financing sources in the near future.

     Accrued  expenses of $694,000  are mainly  royalties  of  $356,000.  Of the
$356,000,  $240,000  is due  for  the  minimum  royalties  under  the  licensing
agreement. Given the FTC's order for the company to cease sale of the product in
1992, the company is in discussion  with the license holder to waive the minimum
royalties.  The  remaining  accrued  expenses  consist  of accrued  interest  of
$195,000,  customer  deposits  $116,000,  audit fees  $21,000 and  miscellaneous
expenses for $6,000.

     In the past,  Registrant's  Chairman of the Board and principal stockholder
has provided Registrant,  either directly or indirectly through guarantees, with
the necessary working capital needed to continue operating.  However, Registrant
has  received no  assurances  that its  Chairman  of the Board will  continue to
provide such funding.
<PAGE>
Private Placement

     In April 1996 the Company  commenced a private  placement of 350,000 shares
of $1.00 par convertible preferred stock and warrants of the Company pursuant to
a private  placement  memorandum  dated  April 8, 1996 and would  have  provided
proceeds of $350,000 if all units were sold.  The  offering  closed on our about
September 30, 1996 with a total of 170,000 shares of the Registrant's  preferred
stock issued. The Company sold 170 units for gross proceeds of $171,000. The net
proceeds, $140,000, of this placement were used to finance the reintroduction of
the Product.

Current Plans of Registrant

Numex

     On February 6, 1996 the U.S. Food and Drug Administration (FDA) in response
to a Premarket  Notification  (510-k) advised  Registrant that it may market its
Therapy Plus manual massage  roller for temporary  relief of minor muscular pain
associated  with arthritis.  Registrant  also previously  sponsored a controlled
clinical  study to comply  with an FTC order  with  respect  to  Therapy  Plus's
effectiveness in relief of pain associated with arthritis.

     Accordingly,  the Company plans to continue  marketing Therapy Plus through
wholesale  and  export  distributors,  using  the newly  accepted  claims by the
government regulatory agency, regarding arthritis pain. The Company is currently
negotiating with several major companies to distribute the Therapy Plus Product.

     Since late fall 1996, Management has been intensively pursuing acquisitions
of a profitable  business.  Management  has been reviewing  several  acquisition
candidates. In anticipation of possible acquisitions the Company has established
a relationship with a medium size investment  banking house which specializes in
private placements of securities and notes with institutional investors.

     Management  is  now in  the  process  of due  diligence  phase  of  several
acquisition candidates, whose revenues range from $4 - $30 million annual sales.

     Although,  there is no guarantee that any of the proposed acquisitions will
materialize,  there is  reasonable  anticipation,  once the  target  company  is
definitely   established   and  meets  all  the  criteria  of  the  Company  and
institutional  investors  that  funds  can  be  obtained  to  finalize  such  an
acquisition.

     It is to be noted that the Company  has  approximately  a $6.5  million tax
loss  carryforward  which can be  available  to be  utilized  by any  profitable
acquisition.

     Registrant  continues  to conduct  negotiations  with a number of companies
with  the  intent  of  acquiring  either  them or their  products.  Registrant's
intention is to raise the requisite funding either through the issuance and sale
of Registrant's  stock, by issuing  Registrant's  stock as consideration for the
acquisition,  or by any other means that is agreeable to all parties involved in
the transaction.


Inflation and Changing Prices

     Registrant does not foresee any adverse effects on its earnings as a result
of inflation or changing prices.

<PAGE>
ITEM 7.  FINANCIAL STATEMENTS
         Index to Financial  Statements
                                                                           Page
Report of Independent Certified Public Accountants                           13

Consolidated Balance Sheet As of March 31, 1996                              14

Consolidated Statements of Operations for the Years Ended March 31, 1996
and 1995                                                                     15

Consolidated Statements of Stockholders' Deficiency for the Years
Ended March 31, 1996 & 1995                                                  16

Consolidated Statements of Cash Flows for the Years Ended March 31, 1996   
and 1996                                                                     17

Notes to Consolidated Financial Statements                                18-26

<PAGE>







            REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


Board of Directors and Stockholders
Numex Corporation

     We have  audited  the  accompanying  consolidated  balance  sheet  of Numex
Corporation  and  subsidiary  as of March 31, 1997 and the related  consolidated
statements of operations,  stockholders' deficiency,  and cash flows for each of
the two years in the period ended March 31, 1997. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.

     We conducted  our audits in accordance  with  generally  accepted  auditing
standards.  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 audits provide a reasonable basis for our opinion.

     In our opinion,  the financial statements referred to above present fairly,
in  all  material  respects,   the  consolidated  financial  position  of  Numex
Corporation and subsidiary as of March 31, 1997, and the consolidated results of
their operations and their  consolidated cash flows for each of the two years in
the  period  ended  March  31,  1997,  in  conformity  with  generally  accepted
accounting principles.

     The  accompanying  consolidated  financial  statements  have been  prepared
assuming  that the Company  will  continue as a going  concern.  As shown in the
financial statements,  the Company has incurred net losses from operations,  has
negative cash flows from  operations,  and has a net capital  deficiency.  These
factors, among others as discussed in Note 1 to the financial statements,  raise
substantial  doubt about the Company's  ability to continue as a going  concern.
Management's  plans in regard to these matters are also described in Note 1. The
financial  statements do not include any adjustments  that might result from the
outcome of this uncertainty.



SINGER LEWAK GREENBAUM & GOLDSTEIN LLP

Los Angeles, California
June 3, 1997

<PAGE>


                        Numex Corporation and Subsidiary
                           CONSOLIDATED BALANCE SHEET
                                 March 31, 1997


                                     ASSETS

Current assets
Cash and cash equivalents                                       $   14,981
Restricted cash (Note 3)                                             5,775
Accounts receivable                                                  9,058
Inventories (Note 4)                                                 8,824

Total current assets                                                38,638

Fixed assets, net (Note 5)                                          18,910
Deposits                                                            12,391

Total assets                                                    $   69,939


LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current liabilities
Notes payable, current portion (Note 6)                         $1,122,778
Notes payable - related parties (Note 12)                           76,834
Accounts payable                                                    78,699
Accrued expenses (Note 7)                                          693,790

Total current liabilities                                        1,972,101

Notes payable, less current portion (Note 6)                       600,000

Total liabilities                                                2,572,101

Commitments and contingencies (Note 13)

Stockholders' deficiency
Preferred stock, $1.00 par value, 10,000,000 shares authorized;
 170,000 shares issued and outstanding                             170,000
Common stock, $.10 par value, 20,000,000 shares authorized;
 6,592,750 shares issued and 5,967,750 shares outstanding          659,275
Treasury stock, at cost, 625,000 shares                           (705,824)
Additional paid-in capital                                       8,132,280
Accumulated deficit                                            (10,757,893)

Total stockholders' deficiency                                  (2,502,162)
                                                   
Total liabilities and stockholders' deficiency                  $   69,939

     The accompanying notes are integral part of the financial statements.
<PAGE>
                        Numex Corporation and Subsidiary
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                   For the years ended March 31, 1997 and 1996


                                                            1997        1996 

Net sales (Note 8)                                    $  296,357  $1,022,878

Cost of sales                                            155,203     557,409

Gross profit                                             141,154     465,469

Selling, general and administrative expenses             653,447     864,139

Loss from operations                                    (512,293)   (398,670)

Other (Expense) income
Interest expense, net                                   (203,766)   (183,224)
Other income                                              40,618     218,796
Write-off of intangible assets in excess of net
 present value                                          (392,398)
Write-off of cost in excess of fair value of net 
 assets acquired                                                    (533,474)
Loss on assignment of assets for benefit
 of creditors of subsidiary                                         (399,572)

Total other (expense) income                            (555,546)   (897,474)

Loss before provision for income taxes and            
 extraordinary item                                   (1,067,839) (1,296,144)   

Provision for income taxes(Note 9)                           800         800

Loss before extraordinary item                       (1,068,639)  (1,296,944)

Extraordinary item - gain on extinguishment of
 debt (Note10)                                          603,565

Net Loss                                              $(465,074) $(1,296,944)

Loss per share before extraordinary item              $   (0.18)   

Gain per share attributable to extraordinary item     $    0.10

Net loss per share                                    $   (0.08) $     (.21)

Weighted average common shares outstanding            6,166,031   6,145,600

      The accompanying notes are integral part of the financil statements.

<PAGE>
                        Numex Corporation and Subsidiary
              CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIENCY
                  For the years ended March 31, 1997 and 1996
 <TABLE>
<S>                      <C>      <C>       <C>       <C>       <C>      <C>       <C>       <C>        <C>          <C>          
                                                                                    Unearned 
                                                                                    Portion of  Additional 
                          Preferred Stock     Common Stock       Treasury Stock     Restricted  Paid-In  Accumulated  
                          Shares  Amount    Shares    Amount    Shares    At Cost  Stock Issued Capital    Deficit        Total 

Balance,  March 31, 1995                    6,270,600 $627,060  125,000   (143,324) (562,500)$7,882,903  $(8,995,875)  (1,191,736)  

Net loss                                                                                                  (1,296,944)  (1,296,944)

Balance, March 31, 1996                     6,270,600 $627,060  125,000  $(143,324)$(562,500)$7,882,903 $(10,292,819) $(2,488,680) 

Preferred stock issued   170,000  $170,000
 for cash                                                                                           850                   170,850  

Offering costs                                                                                  (30,602)                  (30,602)  

Common stock issued 
 for conversion of debt                       322,150   32,215                                  279,129                   311,344  

Conversion or restricted 
 stock to Treasury stock                                        500,000   (562,500)  562,500   

Net Loss                                                                                                    (465,074)   (465,074) 

Balance, March 31, 1997   170,000 $170,000  6,592,750 $659,275  625,000  $(705,824)    $0    $8,132,280 $(10,757,893)$(2,502,162)  


</TABLE>
         The accompanying notes are an integral part of these financial
                                  statements.
<PAGE>
                        Numex Corporation and Subsidiary
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                   For the years ended March 31, 1997 and 1996



                                                            1997        1996 
Cash flows from operating activities
Net loss                                              $( 465,074) $(1,296,944)
Adjustments required to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization                              3,249      81,895
Write-off of cost in excess of fair value of
net assets acquired of subsidiary                                    533,474
Loss on assignment of assets of subsidiary                           399,352
Write-off of intangible asset                            392,398
Gain on extinguishment of debt                          (603,565)
Legal fees and interest expense accrued as
 loan payable                                             57,778
(Increase) Decrease in:
Accounts receivable                                      ( 8,384)      ( 579)
Inventory                                                 41,106      82,419 
Prepaid expenses and other current assets                 36,600     (43,465)
Deposits                                                      40       7,483
(Decrease) Increase in:
Accounts payable                                          23,715    (210,628)
Accrued expenses                                         318,261     (17,850) 

Net cash used in operating activities                   (203,876)   (464,843)

Cash flows from investing activities
Purchase of fixed assets                                 (17,866)     (1,364)

Net cash used in investing activities                    (17,866)     (1,364)

Cash flows from financing activities
Restricted cash                                           (1,454)      5,851
Repayment of notes payable                               (59,000)   (100,730)
Proceeds from notes payable                              145,000     472,000
Repayment of notes payable - related parties             (12,000)    (17,500)
Proceeds from notes payable - related parties             12,000       5,000
Sale of preferred stock                                  170,850
Offering costs                                           (30,602)

Net cash provided by financing activities                224,794     364,621

Net (decrease) increase in cash and cash equivalents       3,052    (101,586)

Cash and cash equivalents, beginning of year              11,929     113,515

Cash and cash equivalents, end of year                   $14,981     $11,929  

See Note 14 for supplemental disclosure of cash flow information.




   The accompanying notes are an integral part of these financial statements.

<PAGE>
                               Numex Corporation
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  For the years ended March 31, 1997 and 1996

NOTE 1 - ORGANIZATION  AND  MANAGEMENT'S  PLANS

     On August 2, 1995, ViaStar filed, and was granted, a petition commencing an
assignment for the benefit of creditors,  pursuant to Chapter 727 of the Florida
State  Statutes.  The book  value of the assets in the  amount of  $399,352  was
assigned to the trustee for the benefit of the creditors and has been charged to
earnings.  As a result of the petition,  the Company  determined  that there had
been a permanent impairment in the carrying value of goodwill, and the remaining
unamortized  balance of $533,474 has been charged to earnings for the year ended
March 31, 1996. ViaStar sales were $601,000 in 1996.

     On March 28, 1997, the  shareholders  of ViaStar  dissolved the corporation
under Delaware state law (see Note 10).

     The Company's  consolidated financial statements have been presented on the
basis that the Company will continue as a going concern,  which contemplates the
realization of assets and the  satisfaction  of liabilities in the normal course
of  business.  In the  absence of the  airing of the  Infomercial,  the  Company
incurred net losses during 1996 and incurred net losses during 1997 after airing
a new  infomercial,  and has a net  capital  deficiency.  Also during the fiscal
years  1997 and 1996,  the  Company  experienced  insufficient  cash  flows from
operations,  and funds for  operations  were  obtained  through the issuances of
notes payable and preferred stock.  These factors raise  substantial doubt about
the Company's ability to continue as a going concern.

     The Company's  continued existence is dependent upon its ability to achieve
a new  operating  plan,  its success of selling  Therapy Plus through  wholesale
distributors.  Management's  plans in  connection  with this  uncertainty  is as
follows:

     The Company  plans to continue  marketing  Therapy Plus  through  wholesale
distributors and exporters.

     Since  late  fall  of  1996,   management  has  been  intensively  pursuing
acquisitions  of a profitable  business.  Management has been reviewing  several
acquisition  candidates.  In anticipation of possible acquisitions,  the Company
has established a relationship with a medium-size investment banking house which
specializes  in private  placements of securities  and notes with  institutional
investors.

     The Company has approximately a $6,500,000 tax loss  carryforward  which is
or could be  available  to be utilized  by a  profitable  acquisition.  The loss
carryforward  would be  limited  on an annual  basis if change in  ownership  is
significant.



<PAGE>

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

     The consolidated  financial  statements include the accounts of the Company
and its  subsidiary.  All  intercompany  accounts  and  transactions  have  been
eliminated.

Cash and Cash Equivalents

     The  Company  considers  cash on hand,  deposits  in banks,  and all highly
liquid  investments  purchased with an original maturity of three months or less
to be cash  equivalents.  The carrying amounts of these assets  approximate fair
value due to the short maturity of the instruments.

Inventories

     Inventories  are  stated  at the  lower of cost or  market  value.  Cost is
determined using the first-in, first-out ("FIFO") method.

Fixed Assets

     Fixed assets are stated at cost.  Expenditures  for maintenance and repairs
are charged to earnings as incurred;  additions,  renewals,  and betterments are
capitalized. When fixed assets are retired or otherwise disposed of, the related
cost and accumulated  depreciation are removed from the respective accounts, and
any gain or loss is included in operations.

     Depreciation is computed using the straight-line  method over the estimated
useful lives of the related  assets.  The  following  are the  estimated  useful
lives:

     Furniture and fixtures                                         3 years
     Tools and dies                                            3 to 5 years

     Depreciation  expense was $3,305 and  $40,493 for fiscal  years ended March
31, 1997 and 1996, respectively.

Impairment of Long-Lived Assets

     In 1997, the Company adopted  Statement of Financial  Accounting  Standards
("SFAS") No. 121,  "Accounting  for the Impairment of Long-Lived  Assets and for
Long-Lived Assets to Be Disposed Of."

     SFAS No. 121 requires  that  long-lived  assets be reviewed for  impairment
whenever events or changes in  circumstances  indicate that the carrying amounts
of such assets may not be recoverable.  Impairment losses would be recognized if
the  carrying  amounts  of the assets  exceed  the fair value of the asset.  The
impact of such adoption  resulted in the write-off of $392,398 for the purchased
intangibles  and the costs of  obtaining a licensing  agreement  from the patent
holder of the Product.

<PAGE>

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Advertising

     The Company expenses the cost of advertising the first time the advertising
takes place, except for direct-response advertising. Direct-response advertising
consists  primarily  of cost to produce a  television  infomercial.  The cost of
direct-response  advertising is deferred and amortized over the expected revenue
stream of approximately six to twelve months.

     For the year ended March 31,  1997,  direct-response  advertising  costs of
approximately  $113,000  were  expensed  due to the  unsuccessful  attempt  of a
direct-response advertising campaign during 1997.

Revenue Recognition

     Sales and related cost of sales are recorded  upon shipment of the Product.
The Company has an  unconditional  money-back  guarantee  policy under which the
full sale price is  returned  to retail  customers  if the  Product is  returned
within 30 days from the date of sale.  The Company has  estimated  provision for
future returns for sales to retail customers.

Income Taxes

     The  Company  uses the  liability  method of  accounting  for income  taxes
pursuant to SFAS No. 109, "Accounting for Income Taxes."

     Deferred income tax assets result from temporary  differences  when certain
amounts  are  deducted  for  financial  statements  purposes  and when  they are
deducted for income tax purposes.

Net Loss Per Share

     Net loss per common share is computed based on the weighted  average number
of  common  shares  outstanding.  The  shares  to be  issued  upon  exercise  of
outstanding  stock options are not included as common stock  equivalents as they
are anti-dilutive.

Fair Value of Financial Instruments

     The Company  measures its financial  assets and  liabilities  in accordance
with  generally  accepted  accounting  principles.  For certain of the Company's
financial  instruments,  including cash, accounts receivable,  accounts payable,
and accrued expenses,  the carrying amounts  approximate fair value due to their
short maturities. The amounts shown for debt also approximate fair value because
current interest rates offered to the Company for debt of similar maturities are
substantially the same.

<PAGE>

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Estimates

     In preparing  financial  statements in conformity  with generally  accepted
accounting  principles,  management  makes estimates and assumptions that affect
the reported  amounts of assets and  liabilities  and  disclosures of contingent
assets and liabilities at the date of the financial  statements,  as well as the
reported  amounts of revenues and expenses during the reporting  period.  Actual
results could differ from those estimates.


NOTE 3 - RESTRICTED CASH

     As of March 31, 1997, the Company had $5,775 of restricted cash to serve as
collateral for a credit card reserve.


NOTE 4 - INVENTORIES

Inventory consists of the following:

    Finished goods                                      $          2,647
    Supplies and packaging                                         6,177

                      Total                             $          8,824


NOTE 5 - FIXED ASSETS

Fixed assets consist of the following:

    Furniture and fixtures                              $        178,507
    Tools and dies                                                38,259

                                                                 216,766
             Less accumulated depreciation                       197,856

                      Total                             $         18,910



<PAGE>

NOTE 6 - NOTES PAYABLE

Notes payable consist of the following:

Unsecured promissory note, bearing interest at 10%, due
  on demand.  The note is personally guaranteed by the
  Company's Chairman of the Board.                      $          6,000

Promissory note, bearing interest at 10%, due on November
  24, 1997.  This note is collateralized by cash, accounts
  receivable, inventories, and fixed assets, and is also
  personally guaranteed by the Company's Chairman of
  the Board.                                                      50,000

Promissory note, at prime (8.5% at March 31, 1997) plus 2%,
  payable in monthly principal payments of $2,000 plus
  interest, due on December 17, 1995.  This note is
  collateralized by cash, accounts receivable, inventories,
  and fixed assets.  The note is delinquent.                      27,000

Promissory note, bearing interest at 10%, payable due on
  August 31, 1996.  This note is convertible into common
  stock at a conversion price of $1.00 per share.  The
  note is personally guaranteed by the Company's
  Chairman of the Board.  The note is delinquent.                200,000

Unsecured promissory notes, bearing interest at 10%,
  due on demand.                                                 789,778

Promissory notes, bearing interest at 10%, due on September
  30, 1998.  These notes are convertible into shares of
  common stock at a conversion price of $1.00 per share.         600,000

Unsecured promissory note, bearing interest at 9.5%, due
  on July 15, 1997.                                               50,000

                  Total notes payable                          1,722,778

                  Less current portion                         1,122,778

              Long-term portion, due in fiscal 1999     $        600,000



<PAGE>

NOTE 7 - ACCRUED EXPENSES

Accrued expenses consist of the following:

   Accrued royalties                                     $        115,218
   Accrued minimum royalties                                      240,300
   Accrued interest                                               194,575
   Customer deposits                                              116,424
   Other                                                           27,273

           Total                                         $        693,790


NOTE 8 - SALES

Major Customers

     During the year ended March 31,  1997,  the Company did  business  with two
customers whose sales comprised approximately 56% and 28%, respectively,  of net
sales.  During the year ended March 31, 1996,  the Company did business with one
customer whose sales comprised approximately 38% of net sales.

NOTE 9 - INCOME TAXES

     The current  provision  for income taxes in both fiscal years 1997 and 1996
is related to state  income  taxes.  As of March 31,  1997,  the Company had net
federal operating loss carryforwards totaling approximately $6,500,000.  The net
operating loss carryforwards expire in various years through 2012.

     The primary  components  of  temporary  differences  which give rise to the
Company's net deferred tax asset (liability) at March 31, 1997 are as follows:

     Deferred tax asset (liability)
     Net operating losses                                    $      2,300,000
     Valuation allowance                                           (2,300,000)

             Net deferred tax asset (liability)              $              -

     The  valuation  allowance  decreased  by  $1,096,000  in  1997  due  to the
expiration of net operating loss carryforwards.



<PAGE>

NOTE 10 - GAIN ON EXTINGUISHMENT OF DEBT

     On  March  28,  1997,  the   shareholders  of  ViaStar  filed  a  corporate
dissolution  under  Delaware law.  Since the  corporation  was dissolved and the
shareholders  are not responsible for the debt of the Company,  the unpaid debts
of $603,565 were  extinguished,  and the Company  recognized a gain. There is no
tax effect of the gain since the Company  has no current  tax expense  given its
utilization of net operating loss carryforwards.


NOTE 11 - STOCK OPTION PLANS

     On September 30, 1992,  the  stockholders  approved a  non-qualified  stock
option plan and an  incentive  stock  option  plan,  pursuant to which a maximum
aggregate  of 1,000,000  shares of common stock have been  reserved for grant to
officers and key employees.  Under both plans,  the option price may not be less
than the fair market value of the common stock on the date of grant. Options are
exercisable  over a five-year period beginning one year after the date of grant,
and the option  exercise  period is not to exceed  ten years from that date.  On
June 30, 1993, 150,000 options were granted under the non-qualified  option plan
to an officer of the  Company at an  exercise  price of $1.625 per share.  As of
March 31, 1997, 90,000 of these options were vested and unexercised.


NOTE 12 - RELATED PARTY TRANSACTIONS

     As of March 31,  1997, a note payable in the amount of $76,834 is unsecured
and due to the Company's  Chairman of the Board.  The note bears interest at 10%
and is due on demand.

     Interest expense to related parties was  approximately  $38,345 and $38,880
for the years ended March 31, 1997 and 1996, respectively.


NOTE 13 - COMMITMENTS AND CONTINGENCIES

Licensing Agreements

     The inventor of the Product obtained a United States patent for the Product
in  February  1991.  The  Company and the patent  owner  entered  into a license
agreement (the "License Agreement") as of January 1, 1992. The License Agreement
grants the Company to an exclusive license to market, manufacture,  and sell the
Product  in the  United  States  and its  possessions  and  territories  for the
remaining life of the patent which is currently  twelve years.  Thereafter,  the
design of the Product will be in the public domain, and the Company,  as well as
other  companies,  will  have the  right to  market,  manufacture,  and sell the
Product.

<PAGE>

NOTE 13 - COMMITMENTS AND CONTINGENCIES (Continued)

Licensing Agreements (Continued)

     The License  Agreement  also  provides for  royalties at rates ranging from
$.50 per unit to $1.20 per unit  depending on the method of  distribution  used.
However,  a minimum  royalty of  $125,000  is  required  to be paid  during each
calendar  year of the term of the License  Agreement  whether or not the Company
sells any units of the Product.

     At March 31,  1997,  the  Company  owed the patent  owner an  aggregate  of
$355,518 in accrued royalties.

Litigation

     As of March 31,  1996,  the  Company  and an  officer of the  Company  (the
"Defendants")  had been named  Defendants in a lawsuit.  The action alleges that
the Defendants  made certain  representations  in connection  with the offer and
sale by the Company to plaintiffs  pursuant to a private  placement  offering by
the Company in May 1994.  On July 17,  1996,  this matter was  dismissed  by the
courts.

     In addition to the above, the Company is subject to other legal proceedings
which  arise  in  the  ordinary  course  of its  business.  In  the  opinion  of
management,  the amounts of ultimate  liabilities  with respect to these actions
will  not  materially  affect  the  Company's  financial  position,  results  of
operations, or cash flows.


NOTE 14 - SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Supplemental cash flow information for the years ended March 31 is as follows:

                                                  1997               1996      

  Cash paid for interest                    $        73,958    $         96,302
  Cash paid for income taxes                $           800    $            800

Non-cash financing activities for the years ended March 31 were as follows:
                                                  1997               1996      

Conversion of note payable - related party to
  300,000 shares of common stock             $       300,000    $              -
Conversion of accounts payable to 22,150 shares
  of common stock                            $        11,344    $              -






<PAGE>

ITEM 8.   CHANGES IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON ACCOUNTING  AND
         FINANCIAL DISCLOSURE
      
 None
                                    PART III.


ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS


     The following  table sets forth the  directors  and  executive  officers of
Registrant as of March 31, 1997.


Name                              Age     Current Position With Company

Jack I. Salzberg                   74     Chairman of the Board and President
Valerio L. Giannini                59     Secretary and Director
William R. Fryrear                 59     Chief Financial Officer
Gerald A. Bagg                     45     Director
Martin Lautman                     50     Director
Isaac S. Salzberg                  45     Director

     Listed below are  descriptions of the business  experience for at least the
past five years for each director and executive  officer listed in the preceding
table. Unless otherwise described below, none of these individuals is related in
any way, or has been  involved  in certain  legal  proceedings  in the past five
years, except as described in the legal proceedings section of this report.

     GERALD A. BAGG served as President, Chief Operating Officer, and a director
of Registrant since March 20, 1992 and as Chief Executive Officer since December
30,  1992.  As of February  1996,  Mr. Bagg  resigned as  President  and CEO but
remains  a  director  and  employee.  From at least  1988,  Mr.  Bagg  served as
President  of Brentwood  Marketing,  a marketing  and  strategic  planning  firm
located in Los Angeles, California.

     WILLIAM R.  FRYREAR  has served as Chief  Financial  Officer of  Registrant
since  January,  1994.  He previously  served in this capacity from March,  1989
until December,  1991. Mr. Fryrear has been Owner of Bar Professional  Services,
an accounting firm located in Beverly Hills, California since 1976.

     VALERIO L. GIANNINI served as President of Registrant from January, 1985 to
February,  1987 has served as a director since 1985 and was elected Secretary in
February  1995.  Since 1990,  Mr.  Giannini has been a self employed  investment
banker and  financial  consultant.  He served as  President  of Geneva  Business
Network, Inc., located in Irvine, California from 1987 to 1990.

     MARTIN R. LAUTMAN has been a director of Registrant  since January 1985. He
formerly served as President from February, 1987 to March, 1989 and as Secretary
from 1985 to February,  1987.  Mr.  Lautman has been Executive Vice President of
Arbor, Inc., located in Media, Pennsylvania, since 1977 and President of Arbor's
Market Research and Consulting Division since 1986.

     ISAAC S. SALZBERG has served as a director of Registrant since March, 1989.
He was formerly  President and Chief Executive Officer of Registrant from March,
1989 to March, 1992. He has been a director of First Charter Bank since 1988 and
an officer  since 1989.  Mr Salzberg  left the bank and all positions in October
1996. Mr.  Salzberg is the son of the Chairman of the Board of Registrant,  Jack
I. Salzberg.

     JACK I. SALZBERG has been Chairman of the Board since January, 1985 and has
served as Chief Executive Officer of Registrant from March, 1992 until December,
1992.  He assumed the  additional  office of President in February  1996. He had
been  Chairman of the Board since 1983 and Chief  Executive  Officer since June,
1989 of First  Charter  Bank,  N.A., a national  bank which  operates two branch
offices in the Los Angeles area,  and of which he was also a major  stockholder.
Mr.  Salzberg  retired from all  positions  with First Charter Bank and divested
himself all stock ownership on September 30, 1995. Mr. Salzberg is the father of
Isaac S. Salzberg, a director of Registrant.

____________________
footnote (1)

     It is with regret that we report that William  Fryrear,  Registrant's  CFO,
passed away on October 18, 1996.


ITEM 10. EXECUTIVE COMPENSATION

     Pursuant to Regulation S-K Item 402 (6) Omission of Table or Column,  there
has been no  compensation  awarded  to,  earned  by or paid to any of the  named
executives required to be in the table or column for fiscal year March 31, 1997.

Arrangements with Directors

     During the fiscal year 1997, Valerio L. Giannini,  a director and Secretary
of  Registrant,  received a total of $12,500 as  compensation  for  professional
services  rendered  to  Registrant  unrelated  to his  services  and duties as a
director.


ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The  following  table sets forth  information  concerning  ownership of the
Registrant's  Common  Stock as of March  31,  1997 by (a) each  director  of the
Registrant;  (b) each person known to Registrant to be the  beneficial  owner of
more than five  percent  (5%) of its Common  Stock;  and (c) all  directors  and
officers of Registrant as a group.


<PAGE>
                                Amount and Nature
                                       of
                              Beneficial Ownership


 
Name of Beneficial                                                   Percent of 
    Owner            Title                          Number of Shares      Class
Gerald A. Bagg       Director                            90,000 (1)       1.48%
Valerio L. Giannini  Corporate Secretary and Director   193,590           3.20%
Martin R. Lautman    Director                           140,430           2.32%
Isaac S. Salzberg    Director                           378,500 (2)       6.25%
Jack I. Salzberg     Chairman of the Board & President 1,160,000         19.15%

All Directors and Officers as a Group  (5  persons)    1,962,520         32.40%


(Footnotes)

     (1) Includes  90,000 shares which Mr. Bagg has the right to acquire through
common stock  options  which became  exercisable  as of June 1, 1996.

     (2)  Includes  85,000  shares  are held by Isaac S.  Salzberg  and Susan S.
Salzberg as trustees  for the Isaac S.  Salzberg  and Susan S.  Salzberg  Living
Trust.  The balance of these shares is held by Mr. Salzberg as custodian for his
minor  children.  Mr.  Salzberg  has the  power  to both  vote  and  direct  the
disposition of his children's shares.

ITEM 12.  CERTAIN  RELATIONSHIPS  AND RELATED  TRANSACTIONS

Loans from Related Parties

Jack I. Salzberg

     Registrant  renewed  $76,834 in demand notes  payable to Jack I.  Salzberg,
Registrant's  Chairman of the Board,  to fiscal year ended March 31, 1997. As of
fiscal  1996  total was  $376,834  of which he  exercised  his option to convert
$300,000  into common stock at $1.00 per share during the fiscal year 1997.  Mr.
Salzberg's note is due on demand and carry interest at 10% at March 31, 1997.

Esther Kozienicki

     Registrant  renewed  $566,000 in notes  payable to Esther  Kozienicki,  the
sister of Jack I. Salzberg,  Registrant's  Chairman of the Board, to fiscal year
ended March 31, 1997 Notes  payable to Esther  Kozienicki at March 31, 1996 were
$566,000. Registrant's board of directors approved and Esther Kozienicki has the
option to convert  $300,000 of her notes  payable into common stock at $1.00 per
share. The notes bear interest at 10% and mature September 30, 1998.

Malka Livne

     Registrant  renewed $350,000 in notes payable to Malka Livne, the sister of
the wife of  Registrant's  Chairman  of the Board to fiscal year ended March 31,
1997.  Notes payable to Malka Livne at March 31, 1996 were  $350,000.  The notes
bear  interest  at 10% and mature  September  30,  1998.  Registrant's  board of
directors  approved  and Malka  Livne has the option to convert  $300,000 of his
notes payable into common stock at $1.00 per share.

<PAGE>



Bank Accounts Held at First Charter Bank

     Registrant maintains several bank accounts with First Charter Bank, located
in Beverly  Hills,  California.  Registrant's  Chairman of the Board was a major
stockholder  and  Chairman  of the Board  through  September  30,  1995 of First
Charter Bank.

                                    PART IV.


ITEM 13. EXHIBITS, LIST AND REPORTS ON FORM 8-K

    (a)(1)   Exhibits

     See Index to Exhibits. The exhibits therein listed and attached hereto, and
the Exhibits  therein  incorporated  by  reference,  are filed as a part of this
report.

     (a)(2)   List

     See exhibits.

     (b) Reports on Form 8-K

     No  reports on Form 8-K were  filed  during the last  quarter of the period
covered by this report.



<PAGE>

                                   SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                           NUMEX CORPORATION


                                            By /s/  JACK I. SALZBERG     
                                                    Jack I. Salzberg
                                              Chairman of the Board & President







Dated:   June 27, 1997

     Pursuant to the  requirements of the Securities  Exchange Act of 1934, this
report  has  been  signed  below  by the  following  persons  on  behalf  of the
Registrant and in the capacities and on the dates indicated.


/s/   JACK I. SALZBERG               
Jack I. Salzberg
Chairman of the Board & President

/s/ GERALD A. BAGG                   
Gerald A. Bagg
Director

/s/ VALERIO L. GIANNINI              
Valerio  L. Giannini
Secretary and Director

/s/ MARTIN R. LAUTMAN             
Martin R. Lautman
Director

/s/ ISAAC S. SALZBERG               
Isaac S. Salzberg
Director

Dated:  June 27, 1997




<PAGE>

INDEX TO EXHIBITS

Exhibit No.

     2.1  Asset  Purchase  Agreement  by and  between  Registrant  and DDI dated
December 3, 1990.  Incorporated  by  reference to exhibit 2(a) to Form 8-K dated
December 9, 1990. 

     2.2 Amendment to Asset  Purchase  Agreement by and between  Registrant  and
DDI,  dated January 2, 1991.  Incorporated  by reference to exhibit 2(b) to Form
8-K dated December 9, 1990.

     3.1 Registrant's Certificate of Incorporation. Incorporated by reference to
exhibit 2.1 to Registrant's Registration Statement on Form S-18, filed on August
14, 1980.

     3.2   Registrant's   Certificate   of  Amendment  to  the   Certificate  of
Incorporation filed August 30, 1985. Incorporated by reference to exhibit 3.3 to
Registrant's  Form 10-K for fiscal year ending March 31, 1988.

     3.3   Registrant's   Certificate   of  Amendment  to  the   Certificate  of
Incorporation filed March 31, 1986. Incorporated by reference to exhibit 10.4 to
Registrant's  Form 10-K for fiscal year ending March 31, 1986.

     3.4   Registrant's   Certificate   of  Amendment  to  the   Certificate  of
Incorporation  filed October 14, 1992.  Incorporated by reference to exhibit 3.4
to Registrant's Form 10-KSB for fiscal year ending March 31, 1993.

     3.5 Bylaws of  Registrant.  Incorporated  by  reference  to exhibit  2.2 to
Registrant's  Registration Statement on Form S-18, filed on August 14, 1980.
     
     3.6 Amendment to Bylaws dated March 19, 1992.  Incorporated by reference to
exhibit 3.6 to  Registrant's  Form 10-KSB for fiscal year ending March 31, 1993.

     3.7 Amendment to Bylaws dated March 30, 1992.  Incorporated by reference to
exhibit 3.7 to  Registrant's  Form 10-KSB for fiscal year ending March 31, 1993.

     3.8 Amendment to Bylaws dated July 15, 1992.  Incorporated  by reference to
exhibit 3.8 to  Registrant's  Form 10-KSB for fiscal year ending March 31, 1993.

     3.9 Amendment to Bylaws dated December 30, 1992.  Incorporated by reference
to exhibit 3.9 to  Registrant's  Form  10-KSB for fiscal  year ending  March 31,
1993.

     4 Specimen Common Stock  Certificate.  Incorporated by reference to exhibit
3.0 to  Registrant's  Registration  Statement on Form S-18,  filed on August 14,
1980 (by amendment). 

     10.1 License  agreement dated as of January 1, 1992 between  Registrant and
Gunter Schweisfurth concerning the Product. Incorporated by reference to exhibit
10.1 to  Registrant's  Form 10-KSB for fiscal year ending March 31,  1993.

     10.2 Mutual  Release  and  Settlement  Agreement  dated  December  17, 1993
between Registrant and Delux Distributions  International,  Incorporated.  Filed
herewith.

     10.8  Registrant's  1992 Stock  Option Plan.  Incorporated  by reference to
exhibit 10.8 to Registrant's Form 10-KSB for fiscal year ending March 31, 1993.
<PAGE>
 INDEX TO EXHIBITS,  cont.

Exhibit No

     10.9 Stock Option Agreement with Gerald A. Bagg.  Incorporated by reference
to exhibit  10.9 to  Registrant's  Form 10-KSB for fiscal year ending  March 31,
1993. 

     10.10  Consent  Agreement  Containing  Order to Cease  and  Desist  between
Registrant and the United States Federal Trade Commission dated October 21, 1992
and  related   Complaint.   Incorporated   by  reference  to  exhibit  10.10  to
Registrant's  Form 10-KSB for fiscal year ending March 31, 1993.

     10.11 Exchange Agreement dated as of April 7, 1994 by and among Registrant,
Jack I. Salzberg,  William Lovell and ViaStar  Marketing,  Inc.  Incorporated by
reference to exhibit  10.11 to Form 8-K filed on April 22, 1994.

     10.12 Amended and Restated  Acquisition  Agreement dated as of June 3, 1994
by and among Registrant,  Airmotive Acquisitions, Inc., ViaStar Marketing, Inc.,
Jack  I.  Salzberg,   William   Lovell,   Robert  Circosta  and  George  Simone.
Incorporated  by reference to exhibit  10.12 to Form 8-K filed on June 17, 1994.

     10.13  Employment  Agreement  dated  June  6,  1994  by and  among  ViaStar
Marketing,  Inc. (f/k/a Airmotive  Acquisitions,  Inc.),  Registrant and William
Lovell. Incorporated by reference to exhibit 10.13 to Form 8-K filed on June 17,
1994.

     10.14  Employment  Agreement  dated  June  6,  1994  by and  among  ViaStar
Marketing,  Inc. (f/k/a  Airmotive  Acquisitions,  Inc.),  Registrant and Robert
Circosta.  Incorporated  by reference to exhibit 10.14 to Form 8-K filed on June
17, 1994.

     10.15  Employment  Agreement  dated  June  6,  1994  by and  among  ViaStar
Marketing,  Inc. (f/k/a  Airmotive  Acquisitions,  Inc.),  Registrant and George
Simone. Incorporated by reference to exhibit 10.15 to Form 8-K filed on June 17,
1994. 

     11 Statement  regarding  computation  of per share  earnings.  Set forth on
Consolidated Statements of Operations, above, as Registrant has a simple capital
structure. 

     21 Subsidiaries of Registrant.

INDEX TO ANNUAL REPORT ON FORM 10-K

10-K Contents

                                                                           PAGE

PART I

     Item 1.  Business                                                       2

     Item 2. Properties                                                      6

     Item 3. Legal Proceedings                                               6

     Item 4. Submission of Matters to Vote of Security Holders               6

PART II.

     Item 5. Market for the Registrant's Common Stock Equity and
             Related Security Holder Matters                                6-7

     Item 6. Management's Discussion and Analysis of Financial 
             Conditions and Results of Operations                           7-9

     Item 7. Financia1 Statements and Supplementary Data                  11-24 

     Item 8. Changes in and disagreements with Accountants 
             on Accounting and Financial Disclosure                         25

     Item 9. Directors and Executive Officers of the Registrant             25

     Item 10. Executive Compensation                                        26

     Item 11. Security Ownership of Certain Beneficial
              Owners and Management .                                      26-27

     Item 12. Certain relationships and Related Transactions               27-28
 
PART IV
     Item 13. Exhibits List and Reports on Form 8-K                       30-31 

SIGNATURES                                                                   32