SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   Form 10-QSB

|X|   Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

                  For the quarterly period ended June 30, 2006

|_|   Transition Report Pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934

       For the transition period from _______________ to ________________

                        Commission file number 000-31143

                                  DCI USA, INC.
           (Exact name of small business as specified in its charter)

            Delaware                                     22-3742159
(State or other jurisdiction of             (IRS Employer Identification Number)
 incorporation or organization)

                    8 Bond Street, Great Neck, New York 11021
                    (Address of principal executive offices)

                                 (718) 383-5255
                (Issuer's telephone number, including area code)

Indicate by check mark whether the issuer (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes |X| No |_|

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act. Yes |_| No |X|

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: Approximately 37,975,684 shares
of Common Stock, $.001 per share, as of August 1, 2006.

Transitional Small Business Disclosure Format (check one): Yes |_| No |X|

<PAGE>

                                  DCI USA, INC.

                                      INDEX

                                                                        Page No.
                                                                        --------
         PART I. FINANCIAL INFORMATION

Item 1.  Financial Statements .......................................          2

         Balance Sheets as of June 30, 2006 (unaudited) and
         December 31, 2005 (audited) ................................          2

         Statements of Operations for the three month and six
         month periods ended June 30, 2006 (unaudited) and June 30,
         2005 (unaudited) ...........................................          3

         Statements of Cash Flows for the six
         month periods ended June 30, 2006 (unaudited) and June 30,
         2005 (unaudited) ...........................................          4

         Notes to Financial Statements ..............................          5

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations ..................................          9

Item 3.  Controls and Procedures ....................................         15

         PART II. OTHER INFORMATION

Item 6.  Exhibits ...................................................         16

SIGNATURES ..........................................................         17

<PAGE>

                          PART I. FINANCIAL INFORMATION
                                  DCI USA, INC.
                                 BALANCE SHEETS

<TABLE>
<CAPTION>
                                                          June 30, 2006   December 31, 2005
                                                          -------------   -----------------
                                                           (Unaudited)
<S>                                                        <C>               <C>
ASSETS
Current Assets:
Cash                                                       $    46,410       $     5,877
Prepaid expense                                                  7,155            12,502
Interest receivable- related party                               6,775             5,857
Notes receivable- related party                              1,370,000         1,370,000
Deferred loan costs                                             20,298            41,548
                                                           -----------       -----------
    Total current assets                                     1,450,638         1,435,784
Noncurrent notes receivable, net of discount                   207,074           201,750
                                                           -----------       -----------
    Total assets                                           $ 1,657,712       $ 1,637,534
                                                           ===========       ===========
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities:
Loan payable - Hypothicators                               $   400,000       $   400,000
Loan Payable - TSSS                                            100,000           100,000
Loan payable - Ichaki                                          100,000                --
Accounts payable                                                60,618           109,644
Accrued interest                                               113,125            62,548
Dividends payable                                                9,167             9,167
Current portion of convertible debentures net of
  discount of $32,344 and $27,552                              454,156           222,448
                                                           -----------       -----------
    Total  current liabilities                               1,137,066           903,807
Convertible note payable - officer                              60,000                --
Noncurrent portion of convertible debentures net of
  discount of $33,544                                               --           216,456
                                                           -----------       -----------
    Total liabilities                                        1,297,066         1,120,263
                                                           -----------       -----------
STOCKHOLDERS' EQUITY
Preferred Stock, par value $.001,
  Authorized 1,000,000 shares
  Series A Preferred, 200,000 shares authorized
  none and 200,000 issued and outstanding, respectively             --               200
Common stock, par value $.001,
  100,000,000 shares authorized, 37,975,684
  and 36,125,035 shares outstanding, respectively               37,639            36,125
Additional paid-in-capital                                   1,834,719         1,822,532
Retained deficit                                            (1,511,712)       (1,341,586)
                                                           -----------       -----------
    Total stockholders' equity                                 360,646           517,271
                                                           -----------       -----------
    Total liabilities and stockholders'
      equity                                               $ 1,657,712       $ 1,637,534
                                                           ===========       ===========
</TABLE>

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


                                       2
<PAGE>

                                  DCI USA, INC.
                             STATEMENT OF OPERATIONS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                    Three Months    Three Months     Six Months      Six Months
                                       Ended           Ended           Ended           Ended
                                   June 30, 2006   June 30, 2005   June 30, 2006   June 30, 2005
                                   -------------   -------------   -------------   -------------
<S>                                 <C>             <C>             <C>             <C>
Income                              $         --    $      9,500    $         --    $      9,500
Interest Income                           45,060          43,436          89,625          88,436
                                    ------------    ------------    ------------    ------------
    Total income                          45,060          52,936          89,625          97,936
                                    ------------    ------------    ------------    ------------
Expenses:
General & administrative expense          66,379          85,219         106,080         155,730
Interest expense                          73,039          42,670         114,327          80,111
Professional fees                         18,134          49,163          36,859         120,083
Management fees                               --              --              --          60,156
Income taxes                               2,485              --           2,485              --
                                    ------------    ------------    ------------    ------------
    Total expenses                       160,037         177,052         259,751         416,080
                                    ------------    ------------    ------------    ------------
Loss from operations                    (114,977)       (124,116)       (170,126)       (318,144)
                                    ------------    ------------    ------------    ------------
Other Income and expense:
Net (gain)/loss on investment                 --          38,923              --          50,253
                                    ------------    ------------    ------------    ------------
  Total Other Income and expense              --          38,923              --          50,253
                                    ------------    ------------    ------------    ------------
    Net loss                        $   (114,977)       (163,039)       (170,126)       (368,397)
                                    ============    ============    ============    ============
Basic and Diluted
  Loss per share                          ($0.00)         ($0.00)         ($0.00)         ($0.01)
                                    ============    ============    ============    ============
Weighted average number of
  Common Stock outstanding            36,860,156      38,203,125      36,494,626      36,936,119
                                    ============    ============    ============    ============
</TABLE>

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


                                       3
<PAGE>

                                  DCI USA, INC.
                            STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

                                                       SIX MONTHS ENDED
                                                           JUNE 30
                                                    ---------------------
                                                       2006       2005
                                                    ---------   ---------
Operating activities:
Net loss
  Adjustments to reconcile net loss to net
    cash flows from operating activities            $(170,126)  $(368,397)
    Amortization of loan costs                         21,250      18,750
    Stock issuance for services                            --      60,156
    (Gain)/Loss on investments                             --      50,253
      Amortization of discounts                        28,750      23,959
    Changes in operating assets and liabilities
        Prepaid expenses                                5,346      (5,615)
        Interest receivable                              (918)    (14,357)
        Accounts payable & accrued expense             (3,769)     92,347
                                                    ---------   ---------
    Net cash flows from operating activities         (119,467)   (142,904)
                                                    ---------   ---------
Investing activities:
Proceeds from sale of investments                          --      30,000
Loans to third parties                                     --       1,000
                                                    ---------   ---------
    Net cash flows from Investing activities               --      31,000
                                                    ---------   ---------
Financing activities:
Proceeds from Convertible debentures                       --     250,000
Proceeds from Loans                                   160,000     150,000
Payment of loan to related party                           --     (84,750)
Payment of loan                                            --    (200,000)
Deferred loan costs                                        --     (30,000)
                                                    ---------   ---------
    Net cash flows from financing activities          160,000      85,250
                                                    ---------   ---------
Decrease in cash and cash equivalents                  40,533     (26,654)
Cash, beginning                                         5,877      38,190
                                                    ---------   ---------
Cash, ending                                        $  46,410   $  11,536
                                                    =========   =========
Supplemental disclosure of cash flow Information:
        Interest Paid                               $  35,000   $  28,540
                                                    =========   =========
        Income Taxes Paid                           $   2,485   $     455
                                                    =========   =========
Noncash Financing Activities:
Repayment of loan through reissuance of shares      $      --   $ 100,000
                                                    =========   =========
Conversion of debt to equity                        $  13,500   $      --
                                                    =========   =========

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


                                       4
<PAGE>

                                  DCI USA, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                  June 30, 2006

NOTE 1 NATURE OF OPERATIONS AND BASIS OF PRESENTATION

      DCI USA, Inc. (referred to herein as "we" or the "Company"), formerly
known as Gavella Corp. ("Gavella"), was incorporated on June 21, 2000 in the
State of Delaware. Until November 9, 2004, the Company was engaged in owning and
operating income producing real estate and investing in and providing consulting
services to small, established companies with defined growth plans. On November
9, 2004, the Company executed a Subscription Agreement with Direct Capital
Investments, Ltd. ("Direct Capital") pursuant to which, among other things,
Direct Capital purchased 31,500,000 post-reverse split shares of common stock
(the "Purchased Shares") of the Company. The Purchased Shares represented 90% of
the then outstanding common stock ("Common Stock") of the Company on a
fully-diluted basis. Direct Capital is an Israeli company which is traded on the
Tel Aviv Stock Exchange. Commencing November 9, 2004, the Company changed its
focus and engaged in lending to and investing in real estate related and other
opportunities. On November 19, 2004, the Company changed its name to DCI USA,
Inc. from Gavella Corp.

      On February 14, 2005, the Company filed with the Securities and Exchange
Commission (the "SEC") an election to operate as a regulated business
development company ("BDC") under the Investment Company Act of 1940 (the "1940
Act"). In February 2006, the Company withdrew its election in order to pursue
other interests.

      Certain information and footnote disclosures normally included in annual
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations. The Company believes that the disclosures are adequate to make the
financial information presented not misleading. These condensed financial
statements should be read in conjunction with the audited financial statements
and the notes thereto included in the Company's Annual Report on Form 10-KSB for
the year ended December 31, 2005, filed with the Securities and Exchange
Commission on March 31, 2006. All adjustments were of a normal recurring nature
unless otherwise disclosed. In the opinion of management, all adjustments
necessary for a fair statement of the results of operations for the interim
period have been included. The results of operations for such interim periods
are not necessarily indicative of the results for the full year.

NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

STOCK-BASED COMPENSATION

      In December 2004, the FASB issued SFAS No. 123 (revised 2004), Share-Based
Payment, which is an amendment to SFAS No. 123, Accounting for Stock-Based
Compensation and supersedes APB Opinion No. 25, Accounting for Stock Issued to
Employees. This new standard eliminates the ability to account for share-based
compensation transactions using Accounting Principles Board (APB) No. 25,
Accounting for Stock Issued to Employees (APB 25) and requires such transactions
to be accounted for using a fair-valued-based method, with the resulting cost
recognized in the Company's financial statements. This standard was effective
for periods beginning after December 15, 2005. The Company has not awarded or
granted any share-based compensation to date.


                                       5
<PAGE>

                                  DCI USA, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                  June 30, 2006

NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

TREATMENT OF HOLDINGS IN BARTRAM

      On November 9, 2004, the Company transferred 80 percent of its interest in
Bartram Holdings, Inc. ("Bartram") to one shareholder. As a result, the
Company's ownership in Bartram was reduced to 20%. As of June 30, 2005, the
Company sold its 20% ownership in Bartram back to Bartram in consideration for
being issued by Bartram a $70,000 principal amount promissory note and the
forgiveness by Bartram of the Company's obligation to pay Bartram $30,000 upon
receipt of such amount from Direct Capital.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

      In December 2004, the FASB issued SFAS No. 153, Exchange of Non-monetary
Assets. SFAS No. 153 amends APB Opinion No. 29, Accounting for Non-monetary
Transactions, to eliminate the exception for non-monetary exchanges of similar
productive assets. The Company is required to apply this statement to
non-monetary exchanges after December 31, 2005. The adoption of this standard is
not expected to have a material effect on the Company's financial position or
results of operations.

      In May 2005, the FASB issued SFAS No. 154, Accounting Changes and Errors
Corrections, which is a replacement of APB Opinion No. 20 and SFAS No. 3. This
new Standard applies to all voluntary changes in accounting principles and
certain other changes where transition rules are not prescribed. The Statement
requires retroactive restatement to prior periods for changes in accounting
principles, unless it is impracticable to determine either the period specific
effects or the cumulative effects of the change. The Statement is effective for
all fiscal years beginning after December 15, 2005. The adoption of SFAS No. 154
did not have a significant effect on the Company.


                                       6
<PAGE>

                                  DCI USA, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                  June 30, 2006

NOTE 3 CONVERTIBLE NOTE PAYABLE- OFFICER

      As of March 1, 2006, Jonathan Ilan Ofir, our Chairman and Chief Executive
Officer, agreed to lend us up to $300,000 on a revolving credit basis until
March 1, 2008 and we issued to Mr. Ofir as of March 1, 2006 a convertible
promissory note (the "Ofir Note") in the principal amount of up to $300,000. The
maximum amount which may be outstanding under the Ofir Note at any given time is
not permitted to exceed $300,000 and we may prepay all or part of the
outstanding balance under the Ofir Note upon five business days' notice to Mr.
Ofir. The principal and accrued interest outstanding under the Ofir Note are due
and payable on March 1, 2008 and are convertible at any time at the option of
Mr. Ofir into shares of our Common Stock at the conversion price of $0.05 per
share. Interest accrues on the principal balance outstanding under the Ofir Note
at the rate of 8% per annum. As of June 30, 2006, $60,000 was outstanding under
the Ofir Note.

NOTE 4 ASSIGNMENT OF SHARES OF MAJOR SHAREHOLDER

As of March 24, 2006, Mr. Ofir acquired 28,350,000 shares of our Common Stock
from Uri Rosin and Gunter Frantz, Ltd. ("Gunter Frantz") pursuant to an
Assignment and Assumption of contract ("Assignment and Assumption of Contract")
whereby Mr. Ofir assumed the obligations of Mr. Rosin and Gunter Frantz under a
Share Sale Agreement dated February 1, 2006 ("the Share Sale Agreement"). The
purchase price of $1,170,004 (or $0.04127 per share) is required to be paid by
Mr. Ofir by December 31, 2007. The right to purchase such 28,350,000 shares from
Direct Capital Investments, Ltd. had been held by Mr. Rosin and Gunter Frantz,
the former controlling shareholders of Direct Capital Investments, Ltd.,
pursuant to the Share Sale Agreement. Mr. Rosin and Gunter Frantz, however,
assigned all of the rights and obligations under the Share Sale Agreement to Mr.
Ofir. Mr. Rosin is Mr. Ofir's father in-law. With respect to the 3,150,000
shares of our Common Stock still held by Direct Capital Investments, Ltd., (i)
the holder has the right, from December 31, 2007 to June 30, 2008, to require
Mr. Ofir to purchase such shares for the aggregate price of $130,000 (or
$0.04127 per share); and (ii) Mr. Ofir has the right, from February 1, 2006 to
June 30, 2008, to require the holder to sell such shares to him for the
aggregate price of $390,000 (or $0.1238 per share).


                                       7
<PAGE>

                                  DCI USA, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                  June 30, 2006

NOTE 5 CONVERTIBLE DEBENTURES WAIVER AGREEMENT

On July 28, 2006, the Company issued 1,350,000 restricted shares of its Common
Stock ("Common Stock") to Cornell Capital Partners LP ("Cornell") and 150,000
restricted shares of its Common Stock to an individual designee of Cornell. The
certificates representing such shares were dated as of June 20, 2006. The
Company believes such issuances were exempt from registration under Section 4(2)
of the Securities Act of 1933, as amended.

      The Company issued these shares pursuant to an agreement (the "Waiver
Agreement"), dated as of June 2, 2006, between the Company and Cornell, which
provided for the waiver by Cornell of certain defaults under the $250,000
principal amount Debenture (each a "Debenture") which the Company had issued to
Cornell in each of December 2004 and February 2005, and under the documents
related to such Debentures. Pursuant to the Waiver Agreement, Cornell became
obligated to cancel the 200,000 shares of the Company's Series A Preferred Stock
("Preferred Stock") which the Company had issued to Cornell in December 2004 as
a commitment fee under the Standby Equity Distribution Agreement, dated December
13, 2004, between the Company and Cornell. In return, the Company became
obligated to issue to Cornell 1,500,000 shares of its Common Stock and grant to
Cornell a put option to sell such 1,500,000 shares back to the Company at the
price of seven and one-half cents ($0.075) per share. The put option has a
duration of three (3) years and may be exercisable by Cornell at any time. Under
the Waiver Agreement, the Company also agreed that the interest rate under the
Debentures would be raised from 8% to 12% per annum, retroactive to the original
dates as of which the Debentures were issued. In addition, subject to the
Company's compliance with the terms of the Waiver Agreement, Cornell agreed
that, until November 2, 2006, it would (i) not convert any additional amount of
the Debentures into shares of our Common Stock, and (ii) forebear from
exercising its rights and remedies under the Debentures and the related
documents.

      As of June 2, 2006, the Company also agreed with Cornell to terminate the
Standby Equity Distribution Agreement.

      As of April 20, 2006, Cornell had elected to convert $13,500 principal
amount of the $250,000 Debenture which the Company issued to Cornell in December
2004. As a result, on or about June 2, 2006, the Company issued to Cornell
350,649 restricted shares of Common Stock. The Company believes such issuance
was exempt from registration under Section 4(2) of the Securities Act of 1933,
as amended.


                                       8
<PAGE>

Item 2. Management's Discussion and Analysis or Plan of Operation

Plan of Operations

      We intend to make investments in real estate and possibly other
businesses. In order to do so, we will need additional financing which we may
not be able to obtain.

Financial Condition and Results of Operations

      Our business and management completely changed as of November 9, 2004. In
addition, we were a business development company from February 2005 until we
withdrew as a BDC in February 2006. The reader should keep in mind such changes
in our business when considering our results of operations.

      Comparison of the results of operations: quarter ended June 30, 2006 to
      quarter ended June 30, 2005

      Our total income for the quarter ended June 30, 2006 was $45,060, compared
with our total income of $52,936 for the quarter ended June 30, 2005. Income for
the quarter ended June 30, 2006 consisted solely of interest income earned from
our notes receivable from related parties.

      Our general and administrative expenses decreased to $66,379 for the
quarter ended June 30, 2006 from $85,219 for the quarter ended June 30, 2005.
The decrease was primarily due to having less consulting fees. Interest expense
increased to $73,039 for the quarter ended June 30, 2006 from $42,670 for the
quarter ended June 30, 2005. The increase is due primarily from the Company's
agreement to raise the interest rate from 8% to 12% on the Debentures per annum,
retroactive to the original dates as of which the Debentures were issued.

      Professional fees decreased from $49,163 for the quarter ended June 30,
2005 to $18,134 for the quarter ended June 30, 2006. We incurred significant
legal and accounting fees during the quarter ended June 30, 2005 because we had
begun to operate as a Business Development Company in February 2005. During the
quarter ended March 31, 2006, we withdrew as a BDC, thereby no longer having to
incur legal and accounting expenses for complying with the rules and regulations
applicable to BDCs.

      Total other income and expense was $38,923 during the quarter ended June
30, 2005, consisting of a net loss on the value of the Bartram investment, and
was zero during the quarter ended June 30, 2006.

      As a result primarily of the reductions in professional fees and general
and administrative expenses and the increase in interest expense from the second
quarter of 2005 to the second quarter of 2006, our total expenses were reduced
and our net loss was reduced from $163,039 to $114,977 during such periods.


                                       9
<PAGE>

      Comparison of the results of operations: six months ended June 30, 2006 to
      six months ended June 30, 2005

      Our total income for the six months ended June 30, 2006 was $89,625,
compared with our total income of $97,936 for the six months ended June 30,
2005. The majority of total income consisted of interest income earned from our
notes receivable from related parties.

      Our general and administrative expenses decreased significantly to
$106,080 for the six months ended June 30, 2006 from $155,730 for the six months
ended June 30, 2005. The decrease was due to the Company paying less consulting
fees. Interest expense was $114,327 for the six months ended June 30, 2006
compared with $80,111 for the six months ended June 30, 2005. The increase is
due primarily from the Company's agreement to raise the interest rate from 8% to
12% on the Debentures per annum, retroactive to the original dates as of which
the Debentures were issued.

      Professional fees decreased from $120,083 for the six months ended June
30, 2005 to $36,859 for the six months ended June 30, 2006. We incurred
significant legal and accounting fees during the six months ended June 30, 2005
because we began to operate as a Business Development Company. During the
quarter ended March 31, 2006, we withdrew as a BDC, thereby no longer having to
incur legal and accounting expenses for complying with the rules and regulations
applicable to BDCs.

      Management fees were $60,156 for the six months ended June 30, 2005, paid
in shares of Common Stock valued at $0.05 per share, but we did not incur
management fees for the six months ended June 30, 2006.

      We had loss on investments of $50,253 for the six months ended June 30,
2005, due to the Company operating as a BDC. No such loss was incurred during
the six months ended June 30, 2006, since the Company no longer operates as a
BDC.

      As a result primarily of the reductions in general and administrative
expenses, professional fees and management fees and the increase in interest
expense from the first six months of 2005 to the first six months of 2006, our
total expenses were reduced and our net loss was reduced from $368,397 to
$170,126 during such periods.

Liquidity and Capital Resources

      Our cash as of June 30, 2006 was $46,410. We believe that we will be able
to meet our cash requirements during 2006 principally through loans from our
Chairman. We expect to incur legal, administrative and consulting and auditing
fees of approximately $300,000 during 2006.

      We will need additional financing to expand our business, to carry out our
business plan and to reduce our debt. There is no assurance that we will be able
to obtain additional financing in sufficient amounts or on acceptable terms when
needed, and our inability to obtain sufficient financing will adversely affect
our operating results and prospects.


                                       10
<PAGE>

      As of June 30, 2006, our notes payable consisted of the following:

<TABLE>
<CAPTION>
                                                                    June 30, 2006
                                                                    -------------
<S>                                                                   <C>
Note Payable to Hypothecators, interest accrues at 15%                $  400,000
per annum payable on the first of each month, due October
15, 2006

Loan payable - TSSS, Inc. - Interest accrues at 8% and is payable
quarterly commencing June 7, 2005, due on March
7, 2006                                                                  100,000

Convertible Debentures Issued to Cornell, net of discount
of $32,544; $236,500 due December 6, 2006 and $250,000
due March 1, 2007                                                        453,281

Note Payable - Ichaki - Interest accrues at 8%
and is payable on demand                                                 100,000
Convertible Note Payable - Officer- Interest
accrues at 8%, due March 1, 2008                                          60,000
                                                                      ----------
                                                                      $1,113,281
</TABLE>

      Included in the $1,113,281 figure, above, is $1,053,281 which is
considered current obligations as of June 30, 2006.

      The $100,000 TSSS, Inc. note referenced above was originally issued by the
Company to NY2K, Inc. as of March 7, 2005. The note was assigned by NY2K, Inc.
to TSSS, Inc. Such note was cancelled as of June 8, 2005 in consideration for
the Company's issuance of 2,000,000 shares of its Common Stock to TSSS, Inc.,
which issuance was made pursuant to the exemption from registration provided by
Regulation E under the Securities Act of 1933, as amended. Subsequent to the
receipt by the Company of a letter from the Staff of the Securities and Exchange
Commission ("SEC") in which the Staff raised questions with respect to the
Company's compliance with the provisions of the Investment Company Act of 1940
applicable to business development companies, the Company and TSSS, Inc.
rescinded the cancellation of the Company's $100,000 note and issuance of
2,000,000 shares of Common Stock. As of June 30, 2006, the due date of the note
of March 7, 2006 had been extended by TSSS, Inc. pending discussions between
TSSS, Inc. and the Company to cancel the note in exchange for the issuance of
shares of Common Stock to TSSS, Inc.

      In exchange for the cancellation of $1,370,000 aggregate principal amount
of note obligations owed to us, we have the rights to acquire an aggregate of
30% of the outstanding membership interests in 231 Norman Avenue Property
Development, LLC ("Norman Property LLC"). We previously reported that Norman
Property LLC had received the necessary approval to convert the commercial use
building at 231 Norman Avenue, Brooklyn, New York, into 68 loft units to be sold
as condominiums. We anticipate that the conversion will be completed this fall
at which time Norman Property LLC will begin to close on the sale of units,
approximately 11 of which are under contract as of the date hereof.


                                       11
<PAGE>

      To enable us to satisfy certain of our obligations pending the receipt of
the proceeds of our current assets, our Chairman has agreed to lend us up to
$300,000 on a revolving basis at the interest rate of 8% per year. We believe
that such amount will enable us to meet our cash needs for 2006.

      On July 28, 2006, the Company issued 1,350,000 restricted shares of its
Common Stock ("Common Stock") to Cornell Capital Partners LP ("Cornell") and
150,000 restricted shares of its Common Stock to an individual designee of
Cornell. The certificates representing such shares were dated as of June 20,
2006. The Company believes such issuances were exempt from registration under
Section 4(2) of the Securities Act of 1933, as amended.

      The Company issued these shares pursuant to an agreement (the "Waiver
Agreement"), dated as of June 2, 2006, between the Company and Cornell, which
provided for the waiver by Cornell of certain defaults under the $250,000
principal amount Debenture (each a "Debenture") which the Company had issued to
Cornell in each of December 2004 and February 2005, and under the documents
related to such Debentures. Pursuant to the Waiver Agreement, Cornell became
obligated to cancel the 200,000 shares of the Company's Series A Preferred Stock
("Preferred Stock") which he Company had issued to Cornell in December 2004 as a
commitment fee under the Standby Equity Distribution Agreement, dated December
13, 2004, between the Company and Cornell. In return, the Company became
obligated to issue to Cornell 1,500,000 shares of its Common Stock and grant to
Cornell a put option to sell such 1,500,000 shares back to the Company at the
price of seven and one-half cents ($0.075) per share. The put option has a
duration of three (3) years and may be exercisable by Cornell at any time. Under
the Waiver Agreement, the Company also agreed that the interest rate under the
Debentures would be raised from 8% to 12% per annum, retroactive to the original
dates as of which the Debentures were issued. In addition, subject to the
Company's compliance with the terms of the Waiver Agreement, Cornell agreed
that, until November 2, 2006, it would (i) not convert any additional amount of
the Debentures into shares of our Common Stock, and (ii) forebear from
exercising its rights and remedies under the Debentures and the related
documents.

      As of June 2, 2006, the Company also agreed with Cornell to terminate the
Standby Equity Distribution Agreement.

      As of April 20, 2006, Cornell had elected to convert $13,500 principal
amount of the $250,000 Debenture which the Company issued to Cornell in December
2004. As a result, on or about June 2, 2006, the Company issued to Cornell
350,649 restricted shares of Common Stock. The Company believes such issuance
was exempt from registration under Section 4(2) of the Securities Act of 1933,
as amended.

Impact of Inflation

      Inflation has not had a material effect on our results of operations.


                                       12
<PAGE>

Forward Looking Statements

      This report contains a number of forward-looking statements that reflect
management's current views and expectations with respect to our business,
strategies, future results and events and financial performance. All statements
made in this Report other than statements of historical fact, including
statements that address operating performance, events or developments that
management expects or anticipates will or may occur in the future, including
statements related to distributor channels, volume growth, revenues,
profitability, adequacy of funds from operations, statements expressing general
optimism about future operating results and non-historical information, are
forward looking statements. In particular, the words "believe," "expect,"
"intend," " anticipate," "estimate," "may," "will," variations of such words,
and similar expressions identify forward-looking statements, but are not the
exclusive means of identifying such statements and their absence does not mean
that the statement is not forward-looking. These forward-looking statements are
subject to certain risks and uncertainties, including those discussed below. Our
actual results, performance or achievements could differ materially from
historical results as well as those expressed in, anticipated or implied by
these forward-looking statements. We do not undertake any obligation to revise
these forward-looking statements to reflect any future events or circumstances.

      Readers should not place undue reliance on these forward-looking
statements, which are based on management's current expectations and projections
about future events, are not guarantees of future performance, are subject to
risks, uncertainties and assumptions (including those described below) and apply
only as of the date of this report. Our actual results, performance or
achievements could differ materially from the results expressed in, or implied
by, these forward-looking statements. Factors that could cause or contribute to
such differences include, but are not limited to, those discussed below in "Risk
Factors" as well as those discussed elsewhere in this report, and the risks
discussed in our press releases and other communications to shareholders issued
by us from time to time which attempt to advise interested parties of the risks
and factors that may affect our business. We undertake no obligation to publicly
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.

Risk Factors

      The reader should carefully consider each of the risks described below. If
any of the following risks develop into actual events, our business, financial
condition or results of operations could be materially adversely affected and
the trading price of the Common Stock could decline significantly.

We Are No Longer A BDC

      We are no longer a business development company and our plan of operations
is not clearly defined. We intend to invest in real estate opportunities but
whether we actually do so will depend upon opportunities that become available
to us and the availability of adequate financing. We cannot be sure that
attractive investment opportunities will become available to us or that we will
have the funds to make such investments if they do become available.


                                       13
<PAGE>

Our Common Stock May Be Affected By Limited Trading Volume and May Fluctuate
Significantly

      There has been a limited public market for our Common Stock and there can
be no assurance that an active trading market for our Common Stock will develop.
As a result, this could adversely affect our stockholders' ability to sell our
Common Stock in short time periods, or possibly at all. Our Common Stock has
experienced, and is likely to experience in the future, significant price and
volume fluctuations that could adversely affect the market price of our Common
Stock without regard to our operating performance. In addition, we believe that
factors such as quarterly fluctuations in our financial results and changes in
the overall economy or the condition of the financial markets could cause the
price of our Common Stock to fluctuate substantially. Substantial fluctuations
in our stock price could significantly reduce the price of our stock.

Our Common Stock is Quoted on the Over-the-Counter Bulletin Board, Which May
Make it More Difficult For Investors to Resell Their Shares Due to Suitability
Requirements

      Our Common Stock is currently quoted on the OTC Bulletin Board where we
expect it to remain for the foreseeable future. Broker-dealers often decline to
trade in OTCBB stocks given that the market for such securities is often
limited, the stocks are more volatile and the risks to investors are greater.
These factors may reduce the potential market for our Common Stock by reducing
the number of potential investors. This may make it more difficult for investors
to sell their shares of Common Stock to third parties or to otherwise dispose of
them. This could cause our stock price to decline.

Delaware Law and Certain Provisions of Our Charter May Inhibit a Takeover of Our
Company That Stockholders May Consider Favorable

      Provisions of Delaware law, such as its business combination statute, may
have the effect of delaying, deferring or preventing a change in control of our
Company. As a result, these provisions could limit the price some investors
might be willing to pay in the future for shares of our Common Stock.

Our Largest Stockholder Has the Ability to Exercise Significant Influence Over
Matters Submitted for Stockholder Approval and His Interests May Differ From
Other Stockholders

      Jonathan Ilan Ofir, our Chairman and CEO, beneficially owns 28,350,000
shares of our Common Stock and has the option to purchase an additional
3,150,000 shares from Direct Capital. He has beneficial ownership of
approximately 75% of our outstanding Common Stock as of June 30, 2006. Mr. Ofir,
therefore, has the ability to appoint our Board of Directors. Accordingly, Mr.
Ofir has significant influence in determining the outcome of any corporate
transaction or other matter submitted to our Board for approval, including
issuing common and preferred stock and appointing officers, which influence
could have a material impact on mergers, acquisitions, consolidations and the
sale of all or substantially all of our assets, and also the power to prevent or
cause a change in control. The interests of Mr. Ofir may differ from the
interests of the other stockholders.


                                       14
<PAGE>

Our Investments May Not Generate Sufficient Income to Cover Our Operations

      Currently, our only assets are certain promissory notes owed to us with
the aggregate fair value as of June 30, 2006 of approximately $1,577,000. We
also have the right to acquire a 30% interest in 231 Norman Avenue Property
Development, LLC by surrendering our rights with respect to $1,370,000 principal
amount of notes owed to us. Although we anticipate receiving net proceeds from
these assets sufficient to satisfy our obligations, there is no assurance as to
when or whether these proceeds will be received. Even if we receive proceeds
sufficient to satisfy our obligations, upon the sale or the liquidation of
Norman Property LLC we will have no ongoing business operations. We intend to
use the net proceeds derived from our current holdings and such additional funds
as we may raise through the issuance of debt or equity securities to acquire
real estate or other businesses. There can be no assurance that we will be
successful in our efforts to acquire any real estate or operating business or,
if acquired, that any such business or project will prove to be profitable.

The Sale or Availability for Future Sale of Substantial Amounts of our Common
Stock could Adversely Affect our Stock Price

      As of June 30, 2006, we had 37,975,684 shares of Common Stock outstanding
and no preferred shares outstanding. We are authorized to issue up to a total of
100,000,000 shares of Common Stock and 1,000,000 shares of blank check preferred
stock. Additional issuances, including the rights and preferences of the
preferred shares, do not require stockholder approval. The sale or availability
for sale of substantial amounts of our Common Stock, in the public market could
adversely affect the market price of our Common Stock. Cornell also holds
approximately $486,500 principal amount of debentures which are convertible into
shares of Common Stock based upon conversion prices equal to averages of
prevailing market prices of the Common Stock. We cannot predict the actual
number of shares of Common Stock that will be issued to Cornell pursuant to
these convertible debentures.

Item 3. Controls and Procedures

      As of the end of the period covered by this report, our management,
including our principal executive officer and our principal financial officer,
have conducted an evaluation of the effectiveness of our disclosure controls and
procedures (as defined in Rule 13a-15 under the Securities Exchange Act of
1934). Based upon that evaluation, our principal executive officer and our chief
financial officer have concluded that our disclosure controls and procedures are
effective in timely alerting them of material information relating to us that is
required to be disclosed by us in the reports we file or submit under the
Exchange Act. There have been no changes in our internal control over financial
reporting that occurred during the period covered by this report that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.


                                       15
<PAGE>

                                     PART II

                                OTHER INFORMATION

Item 6. Exhibits

The following exhibits are filed as part of this report:

Exhibit No.    Description of Exhibit

31.1        -- Certification of Chief Executive Officer pursuant to Rule
               13a-14(a) under the Securities Exchange Act of 1934.

31.2        -- Certification of Chief Financial Officer pursuant to Rule
               13a-14(a) under the Securities Exchange Act of 1934.

32.1        -- Certification of Chief Executive Officer pursuant to Section 906
               of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).

32.2        -- Certification of Chief Financial Officer pursuant to Section 906
               of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).


                                       16
<PAGE>

                                   SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the
Registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

Dated: August 11, 2006

                                DCI USA, INC.


                                By: /s/ Jonathan Ilan Ofir
                                    -----------------------------
                                    Jonathan Ilan Ofir,
                                    Chief Executive Officer


                                    /s/ Michael Gibbs
                                    ---------------------------------
                                    Michael Gibbs,
                                    Chief Financial Officer
                                    (Principal Financial and Accounting Officer)


                                       17
<PAGE>

                                  EXHIBIT INDEX

Exhibit No.    Description of Exhibit

31.1        -- Certification of Chief Executive Officer pursuant to Rule
               13a-14(a) under the Securities Exchange Act of 1934.

31.2        -- Certification of Chief Financial Officer pursuant to Rule
               13a-14(a) under the Securities Exchange Act of 1934.

32.1        -- Certification of Chief Executive Officer pursuant to Section 906
               of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).

32.2        -- Certification of Chief Financial Officer pursuant to Section 906
               of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350).


                                       18