UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

(Mark One)

[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

OR

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

For the transition period from ____________ to ____________

Commission File No. 000-50274

FUSA Capital Corporation

(Exact name of Registrant as specified in its charter)

Nevada	510520296
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)
1420 Fifth Avenue, 22nd Floor, Seattle, WA	98101
(Address of principal executive offices)	(Zip/Postal Code)

(206) 274-5107

(Telephone Number)

Check 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 period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

[X] YES    [  ] NO

State the number of shares outstanding of each of the Issuer's classes of common equity, as of the latest practicable date. There were 59,419,405 common stock shares, par value $0.0001, as of June 30, 2006.

TABLE OF CONTENTS

PART I.	FINANCIAL INFORMATION	4
Item 1.	Financial Statements:	4
	Condensed Consolidated Balance Sheet June 30, 2006 (unaudited)	4
	Unaudited Condensed Consolidated Statements of Operations for the three months ended June 30, 2006 and cumulative from inception on February 9, 2005 through June 30, 2006..	5
	Unaudited Condensed Consolidated Statement of Cashflows for the three months ended June 30, 2006 and cumulative from inception on February 9, 2005 through June 30, 2006..	6
	Consolidated Statement of Stockholders’ equity from inception on February 9, 2005 through June 30, 2006	7
	Notes to Financial Statements (unaudited)	8
Item 2.	Plan of operation	13
Item 3	Controls and Procedures	15
PART II	OTHER INFORMATION	15
Item 1	Legal Proceedings	15
Item 2	Changes in Securities and Small Business Issuer Purchases of Equity Security	15
Item 3	Defaults Upon Senior Securities	15
Item 4	Submission of Matters to a Vote of Security Holders..	15
Item 5	Other Information	15
Item 6	Exhibits and Reports on Form 8-K	16
Signature		17

2

FORWARD-LOOKING STATEMENTS

In addition to historical information, this Report contains forward-looking statements. Such forward-looking statements are generally accompanied by words such as "intends," "projects," "strategies," "believes," "anticipates," "plans," and similar terms that convey the uncertainty of future events or outcomes. The forward-looking statements contained herein are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, those discussed in ITEM 2 of this Report, the section entitled "MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION." Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis only as of the date hereof and are in all cases subject to the Company's ability to cure its current liquidity problems. There is no assurance that the Company will be able to generate sufficient revenues from its current business activities to meet day-to-day operation liabilities or to pursue the business objectives discussed herein.

The forward-looking statements contained in this Report also may be impacted by future economic conditions. Any adverse effect on general economic conditions and consumer confidence may adversely affect the business of the Company.

FUSA Capital Corporation undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof. Readers should carefully review the risk factors described in other documents the Company files from time to time with the Securities and Exchange Commission.

3

Part I - Financial Information

FUSA CAPITAL CORPORATION

(A DEVELOPMENT STAGE COMPANY)

INTERIM CONSOLIDATED BALANCE SHEET

JUNE 30, 2006 AND DECEMBER 31, 2005

	June 30			December 31
	2006			2005
ASSETS
CURRENT ASSETS
Cash	$	119,128		$	342,094
Restricted cash-Note 2		28,750			28,750
Prepaid expenses		590			11,120
Total Current Assets		148,468			381,964
Property and equipment-Note 5		33,271			30,252
Lease deposits		7,603			7,603
Total Assets	$	189,342		$	419,819
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	43,075		$	173,708
Advances payable		-			985,133
Total Current Liabilities		43,075			1,158,841
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY (DEFICIT)
Preferred stock, $.0001 par value, 5,000,000
Shares authorized, none issued		-			-
Common stock, par value $.0001, 500,000,000
Shares authorized, 59,419,405 issued and outstanding (2005-58,202,564 issued and outstanding)		5,401			5,820
Paid in capital		4,275,591			3,346,315
Deficit accumulated during the development stage		(4,134,725	)		11,194
Total Stockholders’ Equity (Deficit)		146,267			(739,022	)
	$	189,342		$	419,819

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

4

FUSA CAPITAL CORPORATION

(A DEVELOPMENT STAGE COMPANY)

INTERIM CONSOLIDATED STATEMENT OF OPERATIONS

for the three months ended June 30, 2006 and 2005 and for the six months ended June 30, 2006

for the period from February 9, 2005 (Inception) to June 30, 2005

for the period February 9, 2005 (Inception) to June 30, 2006

	Three months			Three months			Six months			February 9, 2005			February 9, 2005
	ended			ended			ended			(Inception) to			(Inception) to
	June 30, 2006			June 30, 2005			June 30, 2006			June 30, 2005			June 30, 2006
REVENUE
Sales	$	5,750		$	-		$	6,769		$	-		$	6,769
Interest		428						428			-			610
		6,178			-			7,197			-			7,379
EXPENSES
Selling, general and administrative		294,971			136,768			595,045			136,768			2,196,843
Research and development-Note 4		(572,935	)		1,073,725			(548,495	)		1,073,725			1,705,657
Beneficial conversion expense		-			-			-			-			230,900
Interest		-			813			-			813			1,631
Depreciation and amortization		2,629			1,310			4,215			1,310			7,073
Total Expenses		(275,345	)		1,212,616			50,765			1,212,616			1,142,104
NET INCOME (LOSS)	$	281,523		$	(1,212,616	)	$	(43,568	)	$	(1,212,616	)	$	(4,134,725	)
NET LOSS PER COMMON SHARE, BASIC	$	0.00		$	(0.02	)	$	(0,00	)	$	(0.02	)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING		59,260,516			55,927,564			59,522,709			49,984,052

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

5

FUSA CAPITAL CORPORATION

(A DEVELOPMENT STAGE COMPANY)

INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS

for the six months ended June 30, 2006

for the period from February 9, 2005 (Inception) to June 30, 2005

for the period from February 9, 2005 (Inception) to June 30, 2006

	Six months			February 9, 2005			February 9, 2005
	Ended			(Inception) to			(Inception) to
	June 30, 2006			June 30, 2005			June 30, 2006
OPERATING ACTIVITIES
Net loss from operations	$	(43,568	)	$	(1,212,616	)	$	(4,134,725	)
Adjustments to reconcile net loss to net Cash (used) by operating activities:
Common stock issued (cancelled) for compensation		(732,000	)		1,066,500			2,129,250
Common stock issued for services		14,000			-			23,000
Stock options issued for services		8,728			-			55,669
Beneficial conversion feature on warrant issuance		-			-			230,900
Depreciation and amortization		4,215			1,310			7,073
Loss on disposal of property and equipment		-			-			4,486
Changes in operating assets and liabilities:
Decrease (increase) in prepaid expenses		10,530			139			(590	)
Decrease (increase) in accounts payable and accrued liabilities		(127,647	)		(9,128	)		32,395
Increase in lease deposits		-			-			(7,603	)
Total adjustments		(822,164	)		1,058,821			2,474,580
Net cash (used by) operating activities		(865,732	)		(153,795	)		(1,660,146	)
INVESTING ACTIVITIES
(Increase) in property and equipment		(7,234	)		(17,471	)		(44,827	)
Net cash (used by) investing activities		(7,234	)		(17,471	)		(44,827	)
FINANCING ACTIVITIES
Cash received in recapitalization of the company		-			-			184
Proceeds from issuance of common stock		650,000			80,000			960,000
Offering costs from issuance of stock		-			-			(4,000	)
Increase (decrease) in advances payable		-			(55,820	)		896,667
Net cash provided by financing activities		650,000			24,180			1,852,851
Net increase (decrease) in cash		(222,966	)		(147,086	)		147,878
Cash, beginning of period		370,844			195,280			-
Cash, end of period	$	147,878		$	48,194		$	147,878
Cash Summary, June 30
Cash	$	119,128		$	195,280		$	119,128
Restricted Cash		28,750			-			28,750
Total	$	147,878		$	195,280		$	147,878
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES
Non-monetary net liabilities assumed in a recapitalization of the Company on March 7, 2005:
Liabilities assumed	$	-		$	102,140		$	102,140
Less cash received		-			184			184
Total non-monetary net liabilities assumed	$	-		$	101,956		$	101,956
Interest paid	$	-		$	-		$	1,631

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

6

FUSA CAPITAL CORPORATION

(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT)

	Common Stock						Paid-in			Deficit Accumulated During Development			Total Stockholders’
	Shares			Amount			Capital			Stage			Equity
Inception, Feb 9, 2005, Stock issued for services @ $.0001 per share		27,000,000		$	2,700		$	6,300		$	-		$	9,000
Net (Loss), for the period ended March 6, 2005											(11,605	)		(11,605	)
Balances, March 6, 2005		27,000,000			2,700			6,300			(11,604	)		(2,605	)
Restated Recapitalization March 7, 2005		27,447,564			2,744			(104,701	)					(101,957	)
Shares issued for cash in a private Placement
March 9, 2005 Stock issued for cash @ $.34 per share		300,000			30			99,970						100,000
March 31, 2005 Stock issued for cash @ $.34 per share		390,000			39			129,961						130,000
April 5, 2005 Stock issued for cash @ $.34 per share		60,000			6			19,994						20,000
April 15, 2005 Stock issued for cash $.34 per share		120,000			12			39,988						40,000
April 21, 2005 Stock issued for cash @ $.34 per share		60,000			6			19,994						20,000
Offering costs								(4,000	)					(4,000	)
Beneficial conversion feature- 930,000 warrants issued in above PPM								230,900						230,900
Shares issued as compensation
June 15, 2005 Stock issued @ FMV of $.89 per share		1,200,000			120			1,066,380						1,066,500
July 29, 2005 Stock issued @ FMV of $1.02 per share		900,000			90			917,910						918,000
September 21, 2005 Stock issued @ FMV of $1.22 per share		600,000			60			731,940						732,000
September 22, 2005 Stock issued @ FMV of $1.21 per share		50,000			5			60,495						60,500
October 26, 2005 Stock issued @ FMV of $1.19 per share		25,000			3			29,748						29,750
November 10, 2005 Stock issued @ FMV of $.89 per share		50,000			5			54,495						54,500
Stock options issued for Compensation to non-employees
April 18, 2005 120,000 options vested @ FMV of $.32 per share								38,298						38,298
April 18, 2005 21,819 options vested @ FMV of $.40 per share								8,643						8,643
Loss for the period from March 6, 2005 to December 31, 2005											(4,079,552	)		(4,079,552	)
Balances, December 21, 2005		58,202,564		$	5,820		$	3,346,315		$	(4,091,157		$	(739,022	)
Stock options issued for Compensation to non-employees
January 1, 2006 7,273 options vested @ FMV $.41 per share								2,996						2,996
April 7, 2006, 21,819 options vested @ FMV of $.40 per share								8,728						8,728
Shares issued for services to non- employees
May 24, 2006, stock issued for FMV of $1.40		10,000			1			13,999						14,000
Shares issued for cash in a private placement
February 16, 2006 Stock issued for cash @ $1.00 per share		400,000			40			399,960						400,000
May 24, 2006 Stock issued for cash @ $.75 per share		200,000			20			149,980						150,000
June 5, 2006 Stock issued for cash @ $.75 per share		133,334			13			99,987						100,000
Shares exchanged for debt
February 2, 2006 Stock issued for cash @ $.91 per share		1,073,507			107			985,026						985,133
Cancellation of share issued as compensation to employees		(600,000	)		(600	)		(731,400	)					(732,000	)
Loss for the period ended June 30, 2006											(43,568	)		(43,568	)
Balances, June 30, 2006		59,419,405			5,401			4,275,591			(4,134,725	)		146,267

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

7

FUSACAPITAL CORPORATION

(A Development StageCompany)

Notes to Interim ConsolidatedFinancial Statements

June 30,2006

(Unaudited)

Note 1- InterimReporting

The accompanying unaudited interim consolidated financial statements have been prepared by FUSA Capital Corporation (the “ Company”) pursuant to the rules and regulations of the United States Securities and Exchange Commission. Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these financial statements have been included. Such adjustments consist of normal recurring adjustments. These interim consolidated financial statements should be read in conjunction with the audited financial statements of the Company for the fiscal year ended December 31, 2005.

The results of operations for the six months ended June 30, 2006 are not indicative of the results that may be expected for the full year.

Note 2- Significant accountingpolicies

Useof estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from these estimates.

Restrictedcash

At June 30, 2006 current assets include restricted cash of $28,750, which is held as short term, interest bearing collateral to support a bank credit facility for the Company.

CashEquivalents

The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents.

Financialinstruments

The fair value of cash, accounts payable and accrued liabilities are comparable to the carrying amounts thereof given their short-term maturity.

Concentrationsofcreditrisk

The Company is subject to concentrations of credit risk on their temporary cash investments due to the use of a limited number of banking institutions. The Company mitigates this risk by placing temporary cash investments with major financial institutions, which have all been accorded high ratings by primary rating agencies.

8

FUSACAPITAL CORPORATION

(A Development StageCompany)

Notes to Interim ConsolidatedFinancial Statements

June 30,2006

(Unaudited)

Advertising Costs

We expense all advertising, promotion and marketing costs as they so far have not included any direct- response advertising costs requiring capitalization. Non direct and related costs incurred during the six months and three months ended June 30, 2006 within this category, which are included in selling, general and administrative expense, amounted to approximately $91,000 ( 2005-nil) and $17,000 (2005-nil) respectively.

Stock-based compensation

As permitted by SFAS No. 123, Accounting for Stock-Based Compensation, the Company has elected to follow Accounting Principles Board Opinion (“APB”) No. 25, Accounting for Stock Issued to Employees, and related interpretations in accounting for its stock-based compensation to employees. Under APB No. 25, when the exercise price of the Company’s employee stock options is equal to or greater than the fair value of the underlying stock on the date of grant, no compensation expense is recognized.

In December 2004, the FASB issued SFAS 123R, Share Based Payments. SFAS 123R is applicable to transactions in which an entity exchanges its equity instruments for goods and services. It focuses primarily on transactions in which an entity obtains employee services in share-based payment transactions. SFAS No. 123R supersedes the intrinsic value method prescribed by APB No. 25, requiring that the fair value of such equity instruments be recorded as an expense as services are performed. Prior to SFAS 123R, only certain pro forma disclosures of accounting for these transactions at fair value were required. SFAS 123R will be effective for the first quarter 2006 consolidated financial statements, and permits varying transition methods including retroactive adjustment of prior periods or prospective application beginning in 2006. The Company will adopt SFAS 123R using the modified prospective method effective January 1, 2006. Under this transition method the Company began recording stock option expense prospectively, starting in first quarter 2006.

For stock based compensation to non-employees, the Company is required to follow SFAS No. 123, which requires that stock awards granted to directors, consultants and other non-employees be recorded at the fair value of the award granted.

Researchand developmentcosts

Pursuant to SFAS No. 2, "Accounting for Research and Development Costs," our research and development costs, which relate to the development of software to be used in our search engine technology, were expensed as technological feasibility of the software had not been reached as of June 30, 2006.

The cost of materials and equipment that are acquired for research and development activities and that have alternative future uses are capitalized when acquired, such as computer equipment.

9

FUSACAPITAL CORPORATION

(A Development StageCompany)

Notes to Interim ConsolidatedFinancial Statements

June 30,2006

(Unaudited)

Property and equipment

Property and equipment are recorded at cost. Depreciation is provided over the estimated useful lives of the related assets using the straight-line method and the half year convention. Estimated useful lives for property and equipment categories are as follows:

Furniture andfixtures	7 years
Computer systems	5 years
Leasehold improvements	Lease term

Long lived assets are tested for impairment whenever events or changes in circumstances indicate their carrying amount may not be recoverable. The determination of any impairment loss includes a comparison of estimated undiscounted future cash flows anticipated to be generated during the remaining life of the asset or group of assets to the net carrying value of the asset or group of assets. Where the net carrying amount of the asset or the group of assets is less than the undiscounted future cash flows, an impairment loss is recognized.

Incometaxes

Deferred tax liabilities and assets are determined based on the differences between the book values and the tax bases of assets and liabilities, using tax rates in effect for the years in which the differences are expected to reverse. A valuation allowance is provided to offset any deferred tax asset if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Foreign currency transactions

The business of the Company from Canada involves incurring a substantial number of operational transactions in Canada for which it transacts payments in Canadian currency through a bank account maintained for that purpose. Included in such transactions are payments for salaries, rent, consulting and many other expenses. At the time of payment, each Canadian disbursement is translated into the U. S. dollar equivalent amount and an exchange gain or loss on currency is recorded at that time. During the three months and six months ended June 30, 2006, the currency exchange transactions resulted in a (loss) gain of ( $2,426) (2005 -nil)and $3,379 (2005- nil). As of June 30, 2006, the Canadian bank account balance, which was the only account balance maintained in foreign currency at that date was converted into a U. S. dollar equivalent amount.

Note 3 - Going concern

The Company's consolidated financial statements are prepared using the accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has not commenced its planned principal operations and has not generated revenues. It has incurred a significant operating loss as of June 30, 2006.

The Company is dependent upon its ability to secure equity and/or debt financing and there are no assurances that the Company will be successful. Without sufficient financing, completion of the technology and achievement of profitable operations thereby, it would be unlikely for the Company to continue as a going concern. Management’s plan is to complete the development of its video and audio search engine technology and to utilize it as an internet service for profit.

10

FUSACAPITAL CORPORATION

(A Development StageCompany)

Notes to Interim ConsolidatedFinancial Statements

June 30,2006

(Unaudited)

Note 4- Relatedparty transactions

During the period, in lieu of paying its technology officer’s his earned compensation directly of $81,273, it paid it to a consulting company owned by the Officer. This amount relates principally to his efforts through June 30, 2006, in furthering the development of the Company’s video and audio search engine technology, accordingly, the entire amount was included in research and development expense.

Note 5-Property and equipment

A summary of property and equipment as of June30, 2006 follows:

	Cost		Accumulated Depreciation and amortization		Net bookvalue
Furniture andfixtures	$	7,470	$	1,230	$	6,240
Computer systems		24,253		4,166		20,087
Leasehold improvements		8,621		1,677		6,944
	$	40,344	$	7,073	$	33,271

Note6 - Commitments andcontingencies

OperatingLeases

The Company conducts its operations from two separate office facilities in Vancouver, Canada and one office in Seattle, Washington. One of the facilities in Vancouver is leased under a three-year operating lease expiring in October 2008. The other lease is short term as of March 31, 2006.

The office in Seattle is leased under a month to month rental.

The following is a schedule of future minimum lease payments, exclusive of all executory costs, required under the long-term operating lease above as of March 31, 2006 for the fiscal years ended:

2006	$	21,233
2007		28,311
2008		23,593

11

FUSACAPITAL CORPORATION

(A Development StageCompany)

Notes to Interim ConsolidatedFinancial Statements

June 30,2006

(Unaudited)

Note 7-Issuanceof Common Stock

In February 2006, all of the advances included as debt on the December 31, 2005 consolidated balance totaling $985,133 were converted to equity through the issuance of a total of 1,073,507 shares of restricted common stock.

During the period, the company issued 733,334 shares of common stock for proceeds of $ 650,000.

During the period, the company issued 10,000 shares of common stock for services rendered. The resulting value of stock compensation of $ 14,000 has been included in selling, general and administrative expenses and also included as a component of shareholders’ equity as at June 30, 2006.

In addition, the company cancelled 600,000 shares of common stock which had previously been issued for services rendered. The previously recorded value of stock compensation of $ 722,000 has been credited to research and development expenses and and has included as component of shareholders’ equity as at June 30, 2006.

12

Item 2. Plan of Operation

The following discussion and analysis of our financial condition and results of our operations should be read in conjunction with our financial statements and related notes appearing elsewhere in this report. This discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements.

Plan of Operation

The following discussion regarding our plan of operations for the next 12 months contains forward-looking statements that involve risks, uncertainties and assumptions. The actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors and subsequent events.

Overview

FUSA Capital Corporation (OTCBB:FSAC - News) is a leading innovator of video and audio search engine technologies for online and mobile consumers as well as digital content providers. FUSA operates SearchforVideo.com, a free web-based search engine and video portal that allows consumers to easily locate and view video clips as well as assist video iPod users to find content already formatted for use with their device. The company's proprietary technology has three patents pending and draws upon millions of video clips from more than 10,000 independent sources. For more information visit: www.fusamedia.com.

FUSA’s projected revenue streams will come from advertising revenue from www.searchforvideo.com and from technology and consulting licensing agreements to the enterprise market.

The original business of the Company, as Galaxy, was a development stage company that had a primary business to develop, produce, and market live entertainment in the forum of professional wrestling. Galaxy never developed a significant business in this field and ceased efforts toward establishing operations in the professional wrestling field on March 31, 2004.

On March 31, 2004, the controlling shareholders of Galaxy sold 5,750,000 shares of common stock of the Company to Camila Maz in a private transaction, thus effecting a change of control in the Company. On May 7, 2004, President and Director Jerome Jolly resigned as an Officer and Director, Secretary and Treasurer Grady Johnson also resigned as an Officer and Director. Concurrently, Ms. Maz was appointed as the Sole Director and Officer of the Company. On May 24, 2004, the Company dismissed its auditors and engaged the accounting firm of Braverman International P.C. as the Company’s auditors. During the period from March 31, 2004 until December 31, 2004, the Company engaged in no significant business activities and had no revenues. From March 31, 2004 until March 7, 2005 the Company was engaged in the search for a business combination.

On March 7, 2005, FUSA entered into a merger agreement with FUSA Technology Investments Corp., a Nevada corporation (“FTIC”). The purpose of the merger was to provide value to existing FUSA shareholders by providing the Company with the opportunity to enter the emerging growth field of video and audio search engine technology.  Specifically, as a result of the merger, FUSA has the opportunity to own, develop and market the incomplete video and audio search engine technology conceived by FTIC. This incomplete solution consisted primarily of the design requirements, specifications and know-how of Chief Executive Jenifer Osterwalder, together with an evaluation copy of a partially completed prototype of the search engine. This solution was soft launched in a beta format in September, 2005.

13

As a result of the merger, FUSA is now a technology company focused on the development and marketing of audio and video search engine technology. When completed, this technology will provide a complete video and audio search engine solution, consisting of multiple modules. The search engine solution modules will work together providing a comprehensive video and audio search engine system to discover, scrape, index and generate metadata in RSS (Really Simple Syndication) format for syndication to any Internet enabled device. The search engine solution can be deployed as a stand-alone server for corporate use or in a cluster of servers in a high volume public search engine environment. We intend to market our search solution to companies who operate Internet websites with news, video clip, music and sports content. We also intend to offer consumers search engine capabilities through the development of various internet sites based on the following URLs which we already own: www.searchforvideo.com; www.searchforaudio.com; www.searchfortv.com; www.searchforipod.com; www.searchfortivo.com; www.searchformedia.com; www.searchforpodcasts.com. Our search solution is not yet fully functional. Currently, we have launched a beta version of our websites www.searchforvideo.com and www.searchforipod.com. We have also developed the SearchForMedia Video Portal Server, which is a software suite and service that provides customers with a turnkey media search engine and portal solution. Customers can deploy and manage the software solution in-house or use any or all of SearchForMedia's design, content, advertising or hosted services. We just begun to seek customers for our technology and we do not have any relationships yet in place with any enterprise customers.

Some of the largest, best known and most technologically sophisticated companies in the world compete in the search engine space. Google, Yahoo, Microsoft and Lycos are well-financed, established competitors in this space. In addition, a number of start-ups have entered the audio and video search subspecialty within the search engine space. Many of these start-ups are better financed than we are and may have established customer relationships.

Although our position is one of vulnerable, new entrant, we believe that the possibility of commercial success for us exists in this field because:

1.No established or emerging company in this space has developed a market dominant audio/video search engine product.

2.Because of the size and diversity of the audio/video search engine market, we believe that the market will support a number of different solutions based on the preferences of individual corporate licensors.

3.We believe our technology is competitive with any publicly available audio/video search engine technology.

4.Our “agnostic” independent, non-affiliated status in this field is attractive to customers who may not wish to align themselves with search engine vendors who have competitive products to their own or whose corporate parents are direct or indirect competitors.

5.As has been established by the success of google.com, search engine technology is sufficiently powerful and disruptive that it can create enormous value in a short period of time, displacing large, well-financed and established market leaders.

We believe that our competitive position versus other new entrants to the space is strong because of the flexibility, simplicity and ease of deployment of our technology as well as our relatively low overhead, anticipated responsiveness to customer demands and our expertise in the area of Real Simple Syndication (an HTML programming language which is optimal for the deployment of this kind of search engine technology.

FUSA does not currently have any customers or revenues. Moreover, we have limited capital resources. In the period from February 9, 2005 (Date of Inception) to June 30, 2006, the Company generated no significant revenues and posted a net loss of $4,134,725 resulting from costs of general and administrative expenses, website development stock compensation and interest expenses. The Company is considered a development stage company.

The Company’s executive offices are located at 1420 Fifth Avenue, 22nd Floor, Seattle, Washington, 98101. The Company’s telephone number is 206-274-5107.

The Company’s fiscal year end is December 31.

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ITEM 3. Controls and Procedures

(a) Evaluation of disclosure controls and procedures.

Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934 as of the end of the period covered by this Quarterly Report on Form 10-Q. The evaluation included certain internal control areas in which we have made and are continuing to make changes to improve and enhance controls. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Based on that evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

(b) Changes in internal control over financial reporting.

There were no changes in our internal control over financial reporting that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Part II

OTHER INFORMATION

Item 1. Legal Proceedings

Not Applicable

Item 2. Changes in Securities and Small Business Issuer Purchases of Equity Securities

Recent Sales of Unregistered Securities

Between March and April 2005, we sold 930,000 shares of common stock in a private placement at $0.34 per share, which included an additional issuance of 930,000 warrants to purchase our common stock.

In February 2006, all of the advances included as debt on the December 31, 2005 consolidated balance totaling $985,133 were converted to equity through the issuance of a total of 1,073,507 shares of restricted common stock.

In February 2006, the company issued 400,000 shares of common stock for proceeds of $ 400,000.

Item 3. Defaults Upon Senior Securities

Not Applicable

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

Not Applicable

Item 5. Other Information

None.

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Item 6. Exhibits and Reports on Form 8-K

(a) LIST OF EXHIBITS

List of Exhibits
3.1	Articles of Incorporation of the Company filed September 13, 2000 and Amendments thereto, incorporated by reference to the Registration Statement on Form 10-SB, as amended, previously filed with the SEC.
3.2	By-Laws of the Company adopted September 13, 2000 , incorporated by reference to the Registration Statement on Form 10-SB, as amended, previously filed with the SEC.
4.1	Form of Subscription Agreement between the Registrant and subscribers to its offering of 60 units sold at $20,000 each and containing 20,000 shares of common stock and warrants to purchase 20,000 shares of common stock per unit.
31.1	Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002
32.1	Certification of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(b) REPORTS ON FORM 8-K

On May 12, 2006 and June 9, 2006, the registrant filed reports on form 8-K and 8-K/A respectively reporting the dismissal of Braverman International PC ("Braverman International") as the company’s independent auditor and engagement of Moore & Associates, Chartered to serve as its independent auditor for the fiscal year ending December 31, 2006. Braverman International’s reports on the Company's financial statements for each of the fiscal years ended December 31, 2004 and 2005 did not contain an adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, however, the audit reports contained going concern qualifications.

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SIGNATURE

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.

FUSA Captial Corporation

/s/ Jenifer Osterwalder                                 

Jenifer Osterwalder

Chief Executive Officer

(Duly Authorized Officer and Principal

Financial and Accounting Officer)

Dated: July 27, 2006

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