<PAGE>
 
                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION

                           Washington, D. C.   20549
                                          
                           FORM 10-QSB/A - Number 2      


[X]  Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act
     of 1934
     For the period ended June 30, 1997

[_]  Transition Report Under to Section 13 or 15(d) of The Securities
     Exchange Act of 1934


                      Commission File Number:     0-16052
                                             ---------------


                              QUADRAX CORPORATION
--------------------------------------------------------------------------------
            (Exact name of registrant as specified in its charter)


        Delaware                                             05-0420158
-------------------------------                        ----------------------
(State or other jurisdiction of                        (I.R.S. Employer
incorporation or organization)                         Identification Number)

    300 High Point Avenue   Portsmouth, Rhode Island              02871
--------------------------------------------------------------------------------
      (Address of principal executive offices)                 (Zip Code)

 
                                (401) 683-6600
--------------------------------------------------------------------------------
             (Registrant's telephone number, including area code)

 
________________________________________________________________________________
    (Former name, former address and former fiscal year, if changed since 
                                 last report)


Check mark whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act 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__
                                                                        --      
 
State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date.

        Class                                     Outstanding at August 1, 1997
        -----------------------                   -----------------------------
        Common Stock, par value                               43,171,731 shares
        $.000009 per share

                                       1
<PAGE>
 
                              QUADRAX CORPORATION
    
                            INDEX TO FORM 10-QSB/A      

<TABLE> 
<CAPTION> 
PART I - FINANCIAL INFORMATION                                                   PAGE
<S>                                                                               <C> 
 Item 1  Condensed Consolidated Financial Statements           
                                                              
        Condensed Consolidated Balance Sheets at              
        June 30, 1997 and at December 31, 1996                                      3-4
                                                                                   
        Condensed Consolidated Statements of Operations                            
        for the three and six months ended June 30, 1997 and                       
        June 30, 1996                                                                 5
                                                                                   
        Condensed Consolidated Statements of Cash Flows                            
        for the six months ended June 30, 1997 and                                 
        June 30, 1996                                                               6-7
                                                                                   
        Notes to Condensed Consolidated Financial Statements                       8-11
                                                              
 Item 2  Management's Discussion and Analysis of Financial     
         Condition and Results of Operations                                      12-16



PART II - OTHER INFORMATION                                                          17

 Signatures                                                                          18
</TABLE> 

                                       2
<PAGE>
 
                              QUADRAX CORPORATION
                              -------------------

                          CONSOLIDATED BALANCE SHEETS
                          ---------------------------
                                  (UNAUDITED)
                                  -----------

                                    ASSETS


<TABLE>    
<CAPTION>
                                             June 30,   December 31,
                                              1997          1996
                                         -------------  ------------
<S>                                      <C>            <C>
Current assets:
Cash and cash equivalents                 $   474,140    $ 1,200,063
Accounts receivable, net of allowances
 for doubtful accounts of $399,000          
  and $219,000 respectively                 3,217,015        883,005
Inventories                                 2,041,209      1,266,074
Other current assets                          145,225        184,848
                                          -----------   ------------
                    TOTAL CURRENT ASSETS    5,877,589      3,533,990
                                          -----------   ------------
 
Property and equipment, at cost:
  Machinery and equipment                   6,981,350      4,618,313
  Office equipment                            919,722        910,895
  Leasehold improvements                    1,125,777      1,089,119
                                         ------------   ------------
                                            9,026,849      6,618,327
 
  Less accumulated depreciation and        
   amortization                            (3,844,930)    (3,467,661)
                                         ------------   ------------
              NET PROPERTY AND EQUIPMENT    5,181,919      3,150,666
                                         ------------   ------------
 
Goodwill, net of amortization of
 $7,903 at December 31, 1996                        0        110,651
Other assets                                  343,170        268,179
Deferred assets, net of amortization of
 $48,275 and $70,600, respectively            310,947        236,238
 
                                         ------------   ------------
                            TOTAL ASSETS  $11,713,625    $ 7,299,724
                                         ============   ============
</TABLE>     


                            See accompanying notes.

                                       3
<PAGE>
 
                              QUADRAX CORPORATION
                              -------------------

                          CONSOLIDATED BALANCE SHEETS
                          ---------------------------
                                  (UNAUDITED)
                                  -----------

                     LIABILITIES AND STOCKHOLDERS' EQUITY

<TABLE>    
<CAPTION>
                                            JUNE 30,     DECEMBER 31,
                                              1997           1996
                                        --------------   ------------
<S>                                     <C>              <C> 
Current liabilities:
  Accounts payable                       $  3,083,665    $    685,212
  Accrued expenses                          1,917,642       1,306,053
  Current portion of long-term debt           946,511         856,904
                                        -------------    ------------
            TOTAL CURRENT LIABILITIES       5,947,818       2,848,169

Bank and other debt, less current           
 portion                                    2,805,785         360,739
Convertible debentures payable              1,207,200       1,400,000
                                        -------------    ------------ 
                    TOTAL LIABILITIES       9,960,803       4,608,908
                                        -------------    ------------
Stockholders' equity:
  Common stock                                    382             298
  Additional paid-in capital               72,726,831      68,701,531
  Retained earnings (deficit)             (69,017,477)    (63,757,759)
                                        -------------    ------------
                                            3,709,736       4,944,070
Less:
  Treasury stock, at cost                  (1,125,969)     (1,125,969)
  Unearned compensation and deferred         
   expenses                                  (181,405)       (504,193)
  Notes receivable for options               (649,540)       (623,092)
                                         -------------    ------------
           TOTAL STOCKHOLDERS' EQUITY       1,752,822       2,690,816
                                        -------------    ------------
TOTAL LIABILITIES AND STOCKHOLDERS'      
     EQUITY                              $ 11,713,625    $  7,299,724
                                        =============    ============
</TABLE>     


                            See accompanying notes.

                                       4
<PAGE>
 
                              QUADRAX CORPORATION
                                        
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)

<TABLE>    
<CAPTION>
                                            Three Months Ended June 30,       Six Months Ended June 30,
                                          -------------------------------   -------------------------------
                                              1997             1996             1997             1996
                                          --------------   --------------   --------------   --------------
<S>                                       <C>              <C>              <C>              <C> 
NET SALES                                 $    4,249,702   $      840,327   $    4,874,956   $    1,927,344

COST OF GOODS SOLD                             4,163,840          908,451        4,890,279        1,907,701
                                          --------------   --------------   --------------   --------------
   Gross Profit                                   85,862          (68,124)         (15,323)          19,643

OPERATING EXPENSES:
   Research and development                      288,473           99,044          546,529          393,611
   Selling, general and administrative         1,561,458        1,269,438        2,735,520        2,757,823
   Litigation and restructuring costs          1,270,000                0        1,270,000                0
                                          --------------   --------------   --------------   --------------
      Income from operations                  (3,034,069)      (1,436,606)      (4,567,372)      (3,131,791)

OTHER INCOME (EXPENSE):
   Interest expense                             (713,850)        (775,986)        (735,780)        (839,832)
   Interest income                                19,187           15,389           43,434           30,961
   Other, net                                          0           43,549                0           43,945
                                          --------------   --------------   --------------   --------------

NET LOSS                                     ($3,728,732)     ($2,153,654)     ($5,259,718)     ($3,896,717)
                                          ==============   ==============   ==============   ==============

NET LOSS PER COMMON SHARE                         ($0.10)          ($0.10)          ($0.15)          ($0.19)
                                          ==============   ==============   ==============    ============= 
WEIGHTED AVERAGE COMMON SHARES 
  OUTSTANDING                                 37,270,285       22,470,365       35,154,199       20,876,573
                                          ==============   ==============   ==============    ============= 
 </TABLE>     

                            See accompanying notes.

                                       5
<PAGE>
 
                              QUADRAX CORPORATION
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
               INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                                  (UNAUDITED)

<TABLE>    
<CAPTION>
                                                                                    Six Months              Six Months
                                                                                      Ended                   Ended
                                                                                   June 30, 1997           June 30, 1996
                                                                                 ---------------          --------------- 
<S>                                                                              <C>                      <C>
Cash flows from operating activities:
Net loss                                                                           ($5,259,718)              ($3,896,717)
  Adjustments to reconcile net income to net cash used 
   in operating activities:
    Depreciation & amortization of fixed assets                                        444,821                   302,158
    Amortization of intangibles                                                        118,576                    67,881   
    Amortization of unearned compensation                                              322,788                    52,788
    Common stock issued for expenses                                                   143,750                   160,854
    Common stock issued for interest                                                   602,500                   714,285
    Write-down of machinery and equipment                                              405,479                         0
    Effect on cash flows of changes in assets and liabilities:                                                          
       Accounts receivable and other                                                (2,334,010)                  181,263
       Inventories                                                                    (775,135)                 (423,862)
       Prepaid expenses and other assets                                                39,623                   (59,383)
       Accounts payable                                                              2,398,453                  (122,112)
       Accrued expenses                                                                611,589                  (507,129)
                                                                                   -----------              ------------     
            Net cash used in operating activities                                   (3,281,284)               (3,529,974)
                                                                                   -----------              ------------     
 
Cash flows from investing activities:
  Capital expenditures                                                                (165,563)               (1,023,500)
  Other intangible assets purchased                                                   (105,575)                  (33,350)
  Payments for businesses acquired
   net of cash acquired                                                               (710,175)                        0
                                                                                   -----------              ------------      
            Net cash provided by (used in) investing activities                       (981,313)               (1,056,850)
                                                                                   -----------              ------------     
 
Cash flows from financing activities:
  Proceeds from exercise of common stock options                                         9,826                     4,187
  Net proceeds from sale of preferred stock and warrants                              246,250                 3,150,000
  Issuance of convertible debt, net of costs                                         2,859,752                 1,536,666
  Payment of note to related party                                                           0                  (300,000)
  Issuance of debt                                                                   3,516,938                         0
  Repayment of debt                                                                 (3,096,092)                  (84,854)
                                                                                   -----------              -------------    
            Net cash provided by financing activities                                3,536,674                 4,305,999
                                                                                   -----------              ------------     
 
Net increase (decrease) in cash and cash equivalents                                  (725,923)                 (280,825)
                                                                                                                       
Cash and cash equivalents at beginning of period                                     1,200,063                 2,613,555 
                                                                                   -----------              ------------     
Cash and cash equivalents at end of period                                         $   474,140              $  2,332,730
                                                                                   ===========              ============     
</TABLE>     

                            See accompanying notes.

                                       6
<PAGE>
 
                              QUADRAX CORPORATION



               CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
                           FOR THE SIX MONTHS ENDED
                        JUNE 30, 1997 AND JUNE 30, 1996



Supplemental schedule of significant noncash transactions:


1997:

     The Company issued 9,089,928 shares of its common stock in exchange for the
     cancellation of $3,402,800 of its convertible debentures.

     The Company issued 200,000 shares of its common stock for payment of
     $143,750 of accrued liabilities and expenses.

     The Company disposed of its wholly-owned subsidiaries Lion Golf of Oregon,
     Inc., ("Lion Golf"), and McManis Sports Associates, ("McManis") by Lion
     Golf's former principal shareholder assuming the responsibility for all
     Lion Golf's indebtedness, including $725,376 in notes payable.

 
1996:

     The Company issued 4,450,285 shares of its common stock in exchange for the
     cancellation of $2,866,666 of its convertible debentures.

     The Company issued 67,026 shares of its common stock for payment of $61,870
     of accrued liabilities and expenses.

                                       7
<PAGE>
 
                              QUADRAX CORPORATION

             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


1. The unaudited condensed consolidated financial statements presented herein
   have been prepared in accordance with the instructions to Form 10-QSB and do
   not include all of the information and note disclosures required by generally
   accepted accounting principles.  In the opinion of management, such condensed
   consolidated financial statements include all adjustments, consisting only of
   normal recurring adjustments, necessary to present fairly the Company's
   financial position as of June 30, 1997 and the results of operations for the
   six months ended June 30, 1997 and June 30, 1996.  The results of operations
   for the six month period ended June 30, 1997 may not be indicative of the
   results that may be expected for the year ending December 31, 1997.  It is
   suggested that these Condensed Consolidated Financial Statements be read in
   conjunction with the Consolidated Financial Statements and the notes thereto
   included in the Company's latest annual report to the Securities and Exchange
   Commission on Form 10-KSB for the year ended December 31, 1996.

2. Debt
   ----

   Long-term debt consists of the following:

<TABLE>
<CAPTION>
                                               June 30,       December 31, 
                                                1997              1996     
                                            ------------      -------------
  <S>                                       <C>               <C>          
   Notes payable - bank                     $ 3,430,929           $ 654,464
   Notes payable - to former Lion                                           
     shareholders and others                          0             290,563
   Equipment notes payable                      116,367              97,616
   Other non-interest bearing notes             205,000             175,000
                                            -----------           ---------
                                              3,752,296           1,217,643
  Less current maturities                      (946,511)           (856,904)
                                            -----------           ---------
                                            $ 2,805,785           $ 360,739
                                            ===========           ========= 
</TABLE>

  Note Payable - Bank

     The Company's wholly-owned subsidiary, Victor Electric Wire & Cable
     Corporation ("Victor"), a New York corporation, has a $5,000,000 loan
     agreement with Congress Financial Corporation, "Congress". The loan
     arrangement with Congress provides for a three-year revolving credit
     facility of up to $3,550,000, a $950,000 fully amortizing five year term
     loan and an equipment financing facility of up to $500,000, also based upon
     a five year fully-amortizing repayment schedule. All of such loans bear
     interest at a rate of prime plus 1.5%. The Company has guaranteed all of
     the obligations of Victor to Congress. As of June 30, 1997, the total
     amount due Congress pursuant to this loan agreement was $3,430,929.

     This Agreement is secured by substantially all of Victor's assets
     including, but not limited to, inventory, receivables, and fixed assets.
     The amount available under the revolving loan is limited by a formula based
     on accounts receivable and inventory. The Company intends that
     approximately $2,000,000 would remain outstanding under this agreement for
     an uninterrupted period extending beyond one year from June 30, 1997. As a
     result, this amount under the revolving loan agreement has been classified
     as long-term debt.

                                       8
<PAGE>
 
                              QUADRAX CORPORATION


       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

   Convertible Debentures

   In February 1997, the Company issued $3,210,000 of its Convertible Debentures
   for net proceeds to the Company of $2,889,000. Interest is payable at the
   rate of 8% per annum commencing August, 1997 on the unconverted debentures as
   of August, 1997. The debentures are convertible at various times ranging from
   sixty days to one hundred and fifty days after the date of issuance into a
   number of shares of common stock that can be purchased for a price equal to
   eighty percent of the average closing bid price of the common stock on the
   five trading days immediately prior to the conversion date. At June 30, 1997,
   the holders of these convertible debentures had converted $2,002,800 of the
   debentures into 5,174,020 shares of common stock of the Company.


3. Shareholders Equity
   -------------------

   The Company's capital shares are as follows:

   Class A Convertible Preferred Stock, $10.00 par value, 300,000 shares
   authorized at June 30, 1997 and December 31, 1996, and -0- shares issued and
   outstanding at June 30, 1997 and December 31, 1996.

   Common Stock, $.000009 par value, 90,000,000 shares authorized at June 30,
   1997 and December 31, 1996, and 42,692,195 and 32,680,817 shares outstanding
   at June 30, 1997 and December 31, 1996, respectively.


4. Earnings Per Share
   ------------------

   For the fiscal quarters ending June 30, 1997 and June 30, 1996, the net loss
   per share was computed using the weighted number of average shares
   outstanding during the respective periods. Common Stock equivalents did not
   enter into the computation because the impact would have been anti-dilutive.


5. Acquisition of Victor Electric Wire & Cable Corp.
   ------------------------------------------------

   On May 7, 1997, the Company acquired all of the outstanding stock of Victel,
   Inc., a Delaware corporation ("Victel"), whose sole asset was all of the
   outstanding stock of Victor Electric Wire & Cable Corp. ("Victor") , a
   manufacturer of electric power cords and interconnect cables, for $720,000
   cash and the assumption of approximately $2,840,000 of existing bank debt.
   The existing bank debt was refinanced at the closing by means of Victor
   entering into a new working capital and term credit agreement with Congress
   Financial Corporation.

                                       9
<PAGE>
 
              Notes to Condensed Financial Statements (continued) 

6. Disposition of Lion Golf of Oregon, Inc.
   ----------------------------------------

   On June 4, 1997, the Company completed its disposition of Lion Golf of
   Oregon, Inc., an Oregon corporation ("Lion Golf"), pursuant to the terms of
   an Agreement for the sale of common stock dated as of May 31, 1997.

   Pursuant to the Lion Golf Stock Disposition Agreement, the Company sold all
   of the outstanding stock of Lion Golf of Oregon, Inc. and McManis Sports
   Associates, Inc. to Lion Golf's former principal stockholder, Robert K. Cole.
   In connection therewith Mr. Robert Cole and Lion Golf assumed the
   responsibility for approximately $1,200,000 of Lion Golf's indebtedness,
   including the Bank of Cascades accounts receivable/inventory working capital
   line with Lion Golf which had an outstanding balance due of $449,838 at May
   31, 1997. As additional consideration, the Company's unrecorded unsecured
   promissory note payable to Mr. Cole was canceled along with the Company's
   five year employment agreements with Mr. Robert K. Cole as Chief Executive
   Officer of Lion Golf and Mr. James Cole as President of Lion Golf.

7. Pro-Forma Financial Statements
   ------------------------------

   As discussed in Note 5 to these unaudited condensed consolidated financial 
   statements, the Company on May 7, 1997, acquired Victor Electric Wire and 
   Cable Co., Inc., "Victor". Subsequently, as of May 31, 1997, the Company 
   completed its disposition of Lion Golf of Oregon, Inc., "Lion Golf", which 
   transaction is discussed more fully in Note 6 to these unaudited condensed 
   consolidated financial statements.

   The following unaudited pro forma financial information assumes the 
   acquisition and disposition of these entities occurred at the beginning of 
   each of the fiscal periods presented. This information is not necessarily 
   indicative either of results of operations that would have occurred had the
   purchase and sale been made during the periods presented, or of future 
   results.

  Pro Forma (unaudited)
  ---------------------

<TABLE> 
<CAPTION> 
                                        Three Months Ended June 30,                    Six Months Ended June 30,
                                        --------------------------                     ------------------------
                                          1997              1996                        1997              1996
                                          ----              ----                        ----              ----
<S>                                    <C>            <C>                             <C>           <C>  
Net Sales                                $4,790,530     $4,957,955                      $8,319,229    $8,710,753

Income (Loss) From Operations           ($3,229,428)   ($1,000,838)                    ($4,799,547)  ($2,699,337)

Net Loss                                ($3,957,866)   ($2,185,396)                    ($5,626,380)  ($3,934,634)

Net Loss per Common Share                    ($0.11)        ($0.10)                         ($0.16)       ($0.19)   

    
</TABLE> 
8. Litigation and Restructuring Costs      
   ----------------------------------

   During the six months ending June 30, 1997, the validity of the Company's
   ownership of a pultrusion machine used to manufacture hockey sticks which had
   been acquired from Vega, U.S.A., Inc. ("Vega") was challenged by Powerstick,
   Ltd. ("Powerstick"), in the United States Federal District Court in
   Providence, Rhode Island. After a jury trial in this court, it was determined
   that the owner of the pultrusion machine was Powerstick and Quadrax was
   ordered to return the subject machine to Powerstick, which occurred on July
   7, 1997. In light of this court decision, the Company determined that all
   costs relating to the pultrusion machine including the unamortized portion of
   Vega, U.S.A.'s principal executive's deferred compensation should be expensed
   in the six months ending June 30, 1997. Accordingly, the total amount
   expensed for Vega in this period approximates $645,000.

   Additionally, the Company expensed in the six months ending June 30, 1997,
   approximately $425,000 relating to terminating the Wimbledon license for
   tennis racquets in North America.

   The third component of restructuring costs incurred in the six months ending
   June 30, 1997, relates to the disposition of Lion Golf of Oregon, Inc. as
   described in Note 6 above. The costs relating to this divestiture were
   approximately $200,000 in the six months ending June 30, 1997, and are
   primarily comprised of the write-off of unamortized goodwill relating to the
   acquisition of Lion Golf in 1995.
       
   The Company contracted for the fabrication of a new pultrusion machine which
   it expects to be delivered at the end of the third quarter of 1997. At this
   time, the Company anticipates financing the machine acquisition. Quadrax
   plans to continue to fabricate pultrusion hockey sticks. We anticipate our
   backlog will remain intact until we have the new machine in place and
   operating.

    
9. Accounting Changes
   ------------------

   Previously the Company accounted for the acquisition of Victor by valuing the
   acquired assets at their independently appraised fair market value, which was
   $1,018,020 in excess of their actual purchase price. This fair market
   valuation would have had the effect of increasing depreciation charges over
   the remaining book lives of such equipment (eight years), which would have
   had the effect of lowering reported income for that same amount during the
   eight year period. The fair market valuation also had the effect of
   increasing the Company's reported additional paid-in capital by $1,018,020.

   The Company is revising its accounting treatment of this transaction in order
   to reflect the acquisition of Victor's assets at their actual purchase price.
   This revision has the effect of increasing previously reported losses for the
   quarter ended June 30, 1997 by $80,650. Net worth and fixed assets previously
   reported at June 30, 1997 were reduced by approximately $1 million as a 
   result of the revision.       


                                      10
<PAGE>
 
                              Quadrax Corporation
                              -------------------

                              Segment Information
                              -------------------
                                  (Unaudited)
                                  -----------

<TABLE>    
<CAPTION>
                                                  Six months ended June 30,
                                                   1997*            1996
                                               ----------------------------
<S>                                            <C>               <C>
Net sales
 Quadrax Corporation.........................  $ 1,468,369       $1,927,344
 Victor Electric Wire & Cable Corporation....    3,406,587                0
                                               -----------       ----------
 
                                               $ 4,874,956       $1,927,344
                                               ===========       ==========
 
 
Gross profit
 Quadrax Corporation.........................  $  (617,186)      $   19,643
 Victor Electric Wire & Cable Corporation....      601,863                0
                                               -----------       ----------
 
                                               $   (15,323)      $   19,643
                                               ===========       ==========
      
  
Total assets
 Quadrax Corporation.........................  $ 5,177,422       $9,511,921
 Victor Electric Wire & Cable Corporation....    6,536,203                0
                                               -----------       ----------
     
                                               $11,713,625       $9,511,921
                                               ===========       ==========
 
 
 
Depreciation and amortization expense
 Quadrax Corporation.........................  $   829,273       $  370,039
 Victor Electric Wire & Cable Corp...........              
  -Depreciation and amortization.............       56,912                0
                                               -----------       ----------
 
                                               $   886,185       $  370,039
                                               ===========       ==========
</TABLE>     


--------------------------------------------------------------------------------
*    Information for Victor Electric Wire & Cable Corporation is from
     the date of acquisition, May 7, 1997 to June 30, 1997.

                                       11
<PAGE>
 
  ITEM II

                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS


  The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for forward-looking statements.  Certain matters discussed in this section and
elsewhere in this Form 10-QSB are forward-looking statements.  These forward-
looking statements involve risks and uncertainties including, but not limited
to, economic conditions, product demand and industry capacity, competition, and
other risks.

  Competition.  As the Company enters the sporting goods and recreational
equipment market, it faces competition from other materials used in the
manufacture of such goods and equipment, and from other suppliers of
thermoplastic composites.  The Company's success in entering this market will
depend largely upon its ability to displace other materials currently in use.
If the Company is unsuccessful in creating a niche within the sporting goods and
recreational equipment market by convincing the market of the strategic benefits
of thermoplastic composites, the Company would be adversely affected.  Many of
the companies whose product offerings compete with the Company's product
offerings have significantly greater financial, manufacturing and marketing
resources than the Company.  The Company also faces competition from suppliers
of similar products who do not use thermoplastic materials with the acquisition
of Victor Electric Wire and Cable Corporation ("Victor"), the Company has also
entered the electric cordset industry, which also faces a strong competition
environment.

  Development of Distribution Channels.  Success in the sporting goods and
recreational equipment market will also hinge on the Company's ability to
develop distribution channels, including both retailers and distributors, and
there can be no assurance that the Company will be able to effectively develop
such channels.

  Continued Investment.  Maintaining the Company's technological and strategic
advantages over its competitors will require continued investment by the Company
in design and development, sales and marketing, and customer service and
support.  There can be no assurance that the Company will have sufficient
resources to make such investments.

  Technological Advances.  The Company's ability to maintain a competitive edge
by making technological advances ahead of its competition will have a
significant impact on the success of the Company.

  Outside Financing.  The Company believes that it will need significant outside
financing over the next five years.  There can be no assurance that it will be
able to obtain such financing.


RESULTS OF OPERATIONS FOR QUARTER ENDED JUNE 30, 1997 AS COMPARED TO QUARTER
----------------------------------------------------------------------------
ENDED JUNE 30, 1996
-------------------
    
  The Company's net loss from operations for the quarter ended June 30, 1997
("1997 second quarter") of $3,728,732 was approximately $1,575,000 greater than
its net loss from operations of $2,153,654 for the quarter ended June 30, 1996
("1996 second quarter"). The      

                                       12
<PAGE>
 
primary reason for this increase in the loss is that the Company expensed
$1,270,000 relating to litigation losses and divestiture of assets and trademark
licenses in the 1997 second quarter.
    
  Total sales during the 1997 second quarter were $4,249,702 compared to
$840,327 in the 1996 second quarter, an increase of $3,409,375. This increase in
sales in the 1997 second quarter is attributable to Victor Electric Wire and
Cable Corp., ("Victor"), which was acquired by the Company on May 7, 1997.
Victor's sales from May 7, 1997 to June 30, 1997 were approximately $3,400,000.
    
  Costs of goods sold for the second quarter of 1997 of $4,163,840 increased
$3,255,389 in the three months ended June 30, 1997 vis-a-vis the three months
ended June 30, 1996. The reason for the increase in costs during the 1997 second
quarter as compared to the 1996 second quarter is primarily due to the
acquisition of Victor.      
    
  Research and development expenses were $288,473 in the 1997 second quarter,
which was $189,429 higher than in the 1996 second quarter. The reason for this
increase in the 1997 second quarter is that the Company was capitalizing product
development costs in the 1996 second quarter relating to the development of the
golf shaft manufacturing facility in Vista, California.      
    
  Selling, general and administrative expenses increased by $292,020 to
$1,561,458 in the three months ended June 30, 1997 over the comparable period a
year ago. The primary reason for this increase is the additional selling,
general and administrative expenses, $283,000, incurred by the Company's new
Victor subsidiary since its acquisition in May 1997.      

  Litigation and restructuring costs in the 1997 second quarter were $1,270,000
while in the 1996 second quarter such expenses were not present.  These 1997
restructuring reserves relate to the following: one, the cost of the pultrusion
machine and deferred compensation agreements relating to the 1996 Vega, U.S.A.
acquisition, $645,000; two, costs relating to the divestiture of Lion Golf in
May 1997, primarily goodwill, $200,000; and three, costs relating to the
finalization of the termination of the Wimbledon tennis racquet licensing
relationship, $425,000.

  Interest expense for the second quarter of 1997 decreased by $62,136 to
$713,850. This decrease reflects the Company's 1997 subordinated debt issuances
where the imputed interest expense discount was less in the 1997 second quarter
than in the 1996 second quarter.

  Interest income increased by $3,798 to $19,187 in the three months ended June
30, 1997, as compared to the same period one year ago because of the greater
amount of money the Company had on deposit in interest bearing paper in 1997.

  Other income decreased $43,549 to zero in the 1997 second quarter. The primary
reason for this decrease is that the Company's Lion Golf subsidiary settled a
product trademark dispute with a competitor and received a lump-sum settlement
of $40,000 from that entity in the 1996 second quarter.

                                       13
<PAGE>
 
RESULTS OF OPERATIONS FOR SIX MONTHS ENDED JUNE 30, 1997 AS COMPARED TO SIX
---------------------------------------------------------------------------
MONTHS ENDED JUNE 30, 1996
--------------------------
    
  The Company's net loss from operations for the six months ended June 30, 1997
("1997 first half") of $5,259,718 was approximately $1,363,000 more than its net
loss from operations of $3,896,717 for the six months ended June 30, 1996 ("1996
first half"). The primary reason for this increase in the loss is that the
Company expensed $1,270,000 relating to litigation losses and divestiture of
assets and trademark licenses in the 1997 first half.      

  Total sales during the 1997 first half were $4,874,956 compared to $1,927,344
in the 1996 first half. This increase of approximately $2,947,612 from the 1996
first half resulted from the Company's Victor subsidiary shipping approximately
$3,406,000 of products in the 1997 first half along with approximately $220,000
of increased sales for the quarter of Quadrax's Sports Products. Offsetting
these increases in sales in the 1997 first half was a decline in sales of the
Company's subsidiary, Lion Golf of Oregon of approximately $679,000. During the 
second quarter of 1997, there was a shift in sporting goods sales from Lion Golf
products to Quadrax sporting goods products. The negative impact on the second
quarter sales as compared to the same quarter in 1996 resulted from the 
disposition of Lion Golf which was offset in part by increased sales during the 
quarter of hockey sticks, golf shafts and outside tape sales.
       
  Cost of goods sold increased $2,982,578 in the 1997 first half to $4,890,279.
The reason for the increase in costs during the 1997 first half as compared to
the 1996 first half is primarily due to the acquisition of Victor.      
    
  Research and development expenses were $546,529 in the 1997 first half, an
increase of $152,918 as compared to $393,611 in the 1996 first half. The reason
for this increase is that the Company was capitalizing product development costs
in the 1996 first half relating to the development of the golf shaft
manufacturing facility in Vista, California. In the 1997 first half, this
facility was being depreciated by the Company and product development costs were
being expensed as incurred.      
    
  Selling, general and administrative expenses decreased by $22,303 in the 1997
first half to $2,735,520, an insignificant fluctuation.      

  Litigation and restructuring costs in the 1997 first half were $1,270,000 
while in the 1996 first half such expenses were not present. These 1997 
restructuring reserves relate to the following: one,the cost of the pultrusion 
machine and deferred compensation agreements relating to the 1996 Vega, U.S.A. 
acquisition, $645,000;two, costs relating to the divestiture of Lion Golf in May
1997, primarily goodwill,$200,000;and three, costs relating to the finalization
of the termination of the Wimbledon tennis racquet licensing relationship, 
$425,000.

  Interest expense for the first half of 1997 was $735,780, while in 1996, it
was $839,832,a decrease of $104,052. This decrease reflects the Company's 1997
subordinated debt issuances where the imputed interest discount was less in the
1997 half than in the 1996 first half.

  Interest income in the 1997 first half was $42,434, an increase of $12,473
from the 1996 first half. The reason for this increase was the Company had a
greater amount of money invested in interest bearing paper in 1997.

  Other income decreased $43,945 to zero in the 1997 first half. The primary
reason for this decrease is that the Company's Lion Golf subsidiary settled a
product trademark dispute with a competitor and received a lump-sum settlement
of $40,000 from the entity in the 1996 first half.

                                      14 























<PAGE>
 
Financial Position, Liquidity and Capital Resources
--------------------------------------------------- 
    
  At June 30, 1997, the Company had total assets of $11,713,625 and
stockholders' equity of $1,752,822.  Current assets were $5,877,589 and current
liabilities were $5,947,818 resulting in a working capital deficit of
approximately $70,000 which is a decrease of approximately $755,000 from
December 31, 1996, when working capital was approximately $685,000.  This
decrease in working capital resulted from the Company's continued losses from
operations in the 1997 first half.      

  Cash and cash equivalents decreased by approximately $726,000 from December
31, 1996. This decrease is due primarily to the Company's use of approximately
$3,281,000 to fund its operations, capital expenditures of approximately
$166,000 and the expenditure of approximately $816,000 related to the purchase
of Victor in May 1997. These expenditures were offset by the Company's raising
of additional capital of approximately $3,116,000 along with net new debt
incurred of $420,000.

  Accounts receivable increased by approximately $2,334,000.  The primary reason
for this increase is due to the Company's acquisition of Victor in May 1997.

  Inventories increased by approximately $775,000.  This increase reflects the
additional inventory the Company gained when it purchased Victor.

  Other current assets decreased by approximately $40,000 between June 30, 1997
and December 31, 1996, an insignificant fluctuation.

  Current portion of long-term debt increased by approximately $90,000. This
increase reflects the Company's Victor subsidiary's new working capital line
with Congress Financial Corporation, net of the assumption of the Bank of
Cascades line of credit by the new owners of Lion Golf.

  Accounts payable and accrued expenses increased approximately $3,010,000 from
$1,991,265 at December 31, 1996.  This increase relates to the acquisition of
Victor in May 1997.

  Long term debt increased approximately $2,445,000 to $2,805,785 at June 30,
1997. This increase results from the additional term debt relating to the Victor
acquisition net of the long term debt assumed by the new owners of Lion Golf
when this entity was divested by the Company as of May 31, 1997.

  Convertible debentures decreased to $1,207,200 at June 30, 1997 from
$1,400,000 at December 31, 1996.  This reflects the debenture holder's
conversion of its debentures to common stock during the six months ended June
30, 1997, along with the issuance of an additional $3,210,000 of convertible
debentures in February 1997.

  In the first six months of fiscal 1997, capital expenditures were 
approximately $840,000. These capital expenditures relate primarily to monies
expended for the acquisition of Victor in May 1997.

  The Company generated revenues of approximately $4,900,000 in the first six 
months of fiscal 1997, and as a result, operations were not a total source of 
funds or liquidity for the

                                       15
<PAGE>
 
  In the first six months of fiscal 1997, capital expenditures were
approximately $840,000.  These capital expenditures relate primarily to monies
expended for the acquisition of Victor in May 1997.

  The Company generated revenues of approximately $4,900,000 in the first six
months of fiscal 1997, and as a result, operations were not a total source of
funds or liquidity for the Company. The Company continues to depend on outside
financing for the cash required to fund its operations. Net funds provided by
financing activities in the first half of fiscal 1997, after giving effect to
the repayment of debt, totaled approximately $3,537,000 during the period ended
June 30, 1997.

  The Company believes that funds provided by operations, cash on hand
(approximately $475,000 at June 30, 1997), and monies, $1,000,000, raised from
the sale of convertible debentures in August 1997 will be sufficient to meet the
Company's near-term cash requirements.  In addition, the Company has a binding
commitment from the purchasers of the convertible debentures sold in August 1997
to purchase up to an additional $2,500,000 of convertible debentures prior to
the end of the first quarter of fiscal 1998.  (See Part II - Item 2(c).

  The Company received a going concern qualification from its outside
independent auditors on its fiscal 1996 audited financial statements.  While the
Company believes it has made and will continue to make substantial progress
towards achieving profitability, the results to date have not yet been
sufficient to negate the auditors' qualifications. During this transition,
management continues to redirect the Company's focus from the defense related
products to consumer oriented products.  Management believes that the Company
will be able to continue to raise money from outside third parties in sufficient
amounts to support its operations until the time in which the Company's consumer
product programs generate sufficient revenues.

  There is no assurance that the Company's efforts to achieve viability and
profitability or to raise money will be successful or that the forecasts will be
achieved.  It is difficult for the Company to predict with accuracy the point at
which the Company will be viable and profitable or whether it can achieve
viability or profitability at all, due to the difficulty of predicting
accurately the amount of revenues that the Company will generate, the amount of
expenses that will be required by its operations, and the Company's ability to
raise additional capital.

                                       16
<PAGE>
 
                              QUADRAX CORPORATION


PART II - OTHER INFORMATION


       Item 1  Legal Proceedings

       Item 2(c)  Sale of Unregistered Securities

       Item 5     Other Information

                  Description of Business - Victor Electric Wire & Cable Corp.

       Item 6 - Exhibits and Reports on Form 8-K

             (a)  Exhibits
                      
                  10.1  Employment Agreement between Victor Electric Wire &
                        Cable Corp. and John Palermo*

                  27    Financial Data Schedule*      
 
             (b)  Reports on Form 8-K
             
         *  Previously Filed.      

         .  On June 12, 1997, the Company filed a Form 8-K with respect to the
            its disposition of Lion Golf of Oregon, Inc., an Oregon corporation,
            pursuant to the terms of an Agreement for the sale of common stock
            dated as of May 31, 1997.

         . On July 18, 1997, the Company filed an amended Form 8-K with respect
            to the acquisition of Victor Electric Wire & Cable Corp. with the
            filing of the audited financials for Victor for the fiscal years
            ended June 30, 1996 and June 30, 1995. Also filed was the Company's
            unaudited pro-forma combing condensed consolidated balance sheets as
            of December 31, 1996 and March 31, 1997 and the related unaudited
            pro-forma combing condensed statements of operations for the year
            and three months then ended.

                                       17
<PAGE>
 
                              QUADRAX CORPORATION



                                   SIGNATURES



In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.



                                             QUADRAX CORPORATION
                                             -------------------
                                                (Registrant)



                  
          December 22, 1997                       /s/ James J. Palermo
-----------------------------------          -----------------------------------
          (Date)                             James J. Palermo, Chairman and
                                             Chief Executive Officer

              
          December 22, 1997                      /s/ Brooks R. Herrick
-----------------------------------          -----------------------------------
          (Date)                             Brooks R. Herrick, Executive Vice
                                             President, Chief Financial Officer
                                             (Principal Accounting Officer)


                                      18