UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-K

 

(Mark One)
x	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended June 30, 2012
	OR
£	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from              to

 

AMASYS CORPORATION

(Exact name of registrant as specified in its charter)

 

Delaware	54-1812385
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
6462 Little River Turnpike, Suite E, Alexandria, Virginia	22312
(Address of principal executive offices)	(Zip Code)

 

Registrant’s telephone number, including area code:

(703) 797-8111

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
None	None

 

Securities registered pursuant to Section 12(g) of the Act:

 

Common Stock, par value $0.01 per share

 

 

Indicate by check mark if the registrant is a well-known seasoned issuer as defined in Rule 405 of the Securities Act.  Yes £     No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes £  No x

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Date File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes£ No x

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.  (Check one): 

	Large accelerated filer £	Accelerated filer £
	Non-accelerated filer £ (Do not check if a smaller reporting company)	Smaller reporting company x

 

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Act).  

Yes x      No   £

 

The aggregate market value of the registrant's common stock held by non-affiliates of the registrant on December 31, 2011, the last business day of the registrant's most recently completed second fiscal quarter was $86,595 (based on the closing sales price of the registrant's common stock on that date). 

 

As of September 7, 2012, 14,669,210 shares of the common stock of the registrant were outstanding.

 

DOCUMENTS INCORPORATED BY REFERENCE

 

None.

 

  FORWARD-LOOKING STATEMENTS

 

This report includes forward-looking statements with-in the meaning of Section 27A of the Securities Act (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). We have based these statements on our beliefs and assumptions, based on information currently available to us. These forward-looking statements are subject to risks and uncertainties. Forward-looking statements include the information concerning our possible or assumed future results of operations, our total market opportunity and our business plans and objectives set forth under the sections entitled "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations."

 

Forward-looking statements are not guarantees of performance. Our future results and requirements may differ materially from those described in the forward-looking statements. Many of the factors that will determine these results and requirements are beyond our control. In addition to the risks and uncertainties discussed in "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations," investors should consider those discussed under "Risk Factors" and, among others, the following:

 

We are a non-operating company and are seeking a suitable transaction with a private company; however we may not find a suitable candidate or transaction.  If we are unable to consummate a suitable transaction we will be forced to liquidate and dissolve, which may take three years to complete and may result in our distributing less cash, if any, to our shareholders.  Additionally, we will be spending cash during the winding down of the Company and may not have enough cash to distribute to our shareholders.

 

These forward-looking statements speak only as of the date of this report. We do not intend to update or revise any forward-looking statements to reflect changes in our business, anticipated results of our operations, strategy or planned capital expenditures, or to reflect the occurrence of unanticipated events.

 

  PART I

 

Item 1.  Business.

 

Company History

 

AMASYS Corporation (“AMASYS” or the “Company”) was incorporated in Delaware in 1992, and in 1996 received all remaining assets of Infotechnology, Inc. (“Infotech”), a Delaware company, following the completion of Infotech’s Chapter 11 Bankruptcy reorganization, in accordance with an Assignment and Assumption Agreement, dated October 11, 1996, and effective as of June 21, 1996.  As a result of a series of transactions during the 1980’s, Infotech, then principally engaged in the information and communications business, acquired equity interests in Comtex News Network, Inc. (“Comtex”) and Analex Corporation (“Analex”), formerly known as Hadron, Inc.  Our business was the maintenance of our equity interest in and note receivable from Comtex and equity interest in Analex.  

 

On September 25, 2006, we exchanged the equity investment in Comtex common stock and the Note Receivable from Comtex of $856,954, for 55,209 shares of the AMASYS Series A Preferred stock.  We no longer have an equity interest in either the common stock of Comtex or the Note from Comtex.

 

During October 2006, we sold the remaining 21,000 shares of common stock of publicly-held Analex, a defense contractor specializing in systems engineering and developing innovative technical intelligence solutions in support of U.S. national security.  We no longer have an equity interest in Analex.

 

Since we redeemed and converted all of our outstanding Series A Preferred Stock at the end of September 2006, starting October 1, 2006 we have not conducted any business operations.  All of our operating results and cash flows reported in the accompanying financial statements from October 1, 2006 are considered to be those related to development stage activities and represent the 'cumulative from entering developmental stage' amounts from its development stage activities required to be reported pursuant to Financial Accounting Standards Board Accounting Standards Codification (“ASC”) Topic 915 “Development Stage Entities”.

Business of Issuer

 

Currently, the Company seeks suitable candidates for a business combination with a private company.  The Company has made no efforts to identify a possible business combination. As a result, the Company has not conducted negotiations or entered into a letter of intent concerning any target business. The business purpose of the Company is to seek the acquisition of, or merger with, an existing company. We intend to provide shareholders with complete disclosure concerning a target company and its business, including audited financial statements prior to any merger or acquisition where such disclosure is required by law.

 

The Company is currently considered to be a "blank check" company. The U.S. Securities and Exchange Commission (the “SEC”) defines those companies as "any development stage company that is issuing a penny stock, within the meaning of Section 3 (a)(51) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and that has no specific business plan or purpose, or has indicated that its business plan is to merge with an unidentified company or companies." Under SEC Rule 12b-2 under the Exchange Act, the Company also qualifies as a “shell company,” because it has no or nominal assets (other than cash) and no or nominal operations.  Many states have enacted statutes, rules and regulations limiting the sale of securities of "blank check" companies in their respective jurisdictions. Management does not intend to undertake any efforts to cause a market to develop in our securities, either debt or equity, until we have successfully concluded a business combination. The Company intends to comply with the periodic reporting requirements of the Exchange Act for so long as it is subject to those requirements.

 

The Company’s principal business objective for the next 12 months and beyond such time will be to achieve long-term growth potential through a combination with a business rather than immediate, short-term earnings. The Company will not restrict its potential candidate target companies to any specific business, industry or geographical location and, thus, may acquire any type of business.

 

The analysis of new business opportunities will be undertaken by or under the supervision of the officer and director of the Company.  As of this date, the Company has not entered into any definitive agreement with any party, nor have there been any specific discussions with any potential business combination candidate regarding business opportunities for the Company.  The Company has unrestricted flexibility in seeking, analyzing and participating in potential business opportunities. In its efforts to analyze potential acquisition targets, the Company will consider the following kinds of factors:

 

a)	Potential for growth, indicated by new technology, anticipated market expansion or new products;

 

b)	Competitive position as compared to other firms of similar size and experience within the industry segment as well as within the industry as a whole;

 

c)	Strength and diversity of management, either in place or scheduled for recruitment;

 

d)	Capital requirements and anticipated availability of required funds, to be provided by the Company or from operations, through the sale of additional securities, through joint ventures or similar arrangements or from other sources;

 

e)	The cost of participation by the Company as compared to the perceived tangible and intangible values and potentials;

 

f)	The extent to which the business opportunity can be advanced;

 

g)	The accessibility of required management expertise, personnel, raw materials, services, professional assistance and other required items; and

 

h)	Other relevant factors.

 

In applying the foregoing criteria, no one of which will be controlling, management will attempt to analyze all factors and circumstances and make a determination based upon reasonable investigative measures and available data. Potentially available business opportunities may occur in many different industries, and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex. Due to the Company's limited capital available for investigation, the Company may not discover or adequately evaluate adverse facts about the opportunity to be acquired.

 

Form of Acquisition

 

The manner in which the Company participates in an opportunity will depend upon the nature of the opportunity, the respective needs and desires of the Company and the promoters of the opportunity, and the relative negotiating strength of the Company and such promoters.

 

It is likely that the Company will acquire its participation in a business opportunity through the issuance of common stock or other securities of the Company. Although the terms of any such transaction cannot be predicted, it should be noted that in certain circumstances the criteria for determining whether or not an acquisition is a so-called "tax free" reorganization under Section 368(a)(1) of the Internal Revenue Code of 1986, as amended (the "Code") depends upon whether the owners of the acquired business own 80% or more of the voting stock of the surviving entity. If a transaction were structured to take advantage of these provisions rather than other "tax free" provisions provided under the Code, all prior stockholders would in such circumstances retain 20% or less of the total issued and outstanding shares of the surviving entity. Under other circumstances, depending upon the relative negotiating strength of the parties, prior stockholders may retain substantially less than 20% of the total issued and outstanding shares of the surviving entity. This could result in substantial additional dilution to the equity of those who were stockholders of the Company prior to such reorganization.

 

The present stockholders of the Company will likely not have control of a majority of the voting securities of the Company following a reorganization transaction. As part of such a transaction, all or a majority of the Company's directors may resign and one or more new directors may be appointed without any vote by stockholders.

 

In the case of an acquisition, the transaction may be accomplished upon the sole determination of management without any vote or approval by stockholders. In the case of a statutory merger or consolidation directly involving the Company, it will likely be necessary to call a stockholders' meeting and obtain the approval of the holders of a majority of the outstanding securities. The necessity to obtain such stockholder approval may result in delay and additional expense in the consummation of any proposed transaction and will also give rise to certain appraisal rights to dissenting stockholders. Most likely, management will seek to structure any such transaction so as not to require stockholder approval.

 

It is anticipated that the investigation of specific business opportunities and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require substantial management time and attention and substantial cost for accountants, attorneys and others. If a decision is made not to participate in a specific business opportunity, the costs theretofore incurred in the related investigation might not be recoverable. Furthermore, even if an agreement is reached for the participation in a specific business opportunity, the failure to consummate that transaction may result in the loss to the Registrant of the related costs incurred.

 

Employees

 

We presently have no employees apart from our management. Our officers and directors are engaged in outside business activities and anticipate that they will devote to our business very limited time until the acquisition of a successful business opportunity has been identified. We expect no significant changes in the number of our employees other than such changes, if any, incident to a business combination.

Item 1A.  Risk Factors

The following important factors, and the important factors described elsewhere in this report or in our other filings with the SEC, could affect (and in some cases have affected) our results and could cause our results to be materially different from estimates or expectations.  Other risks and uncertainties may also affect our results or operations adversely.  The following and these other risks could materially and adversely affect our business, operations, results or financial condition.

 

We have a history of net losses and may never achieve or maintain profitability.

 

We have a history of incurring losses from operations. As of June 30, 2012, we had an accumulated deficit of $752,543.   We are currently funding our operations through loans. Our ability to continue may prove more expensive than we currently anticipate and we may incur significant additional costs and expenses.

 

We are a non-operating company seeking a suitable transaction and may not find a suitable candidate or transaction

 

We are a non-operating company.  If we are unable to consummate a transaction or become profitable we will be forced to liquidate and dissolve and may result in our distributing less cash to our shareholders.  Additionally, we will be spending cash during the winding down and may not have enough cash to distribute to our shareholders.

 

We are currently funding our operations through loans

 

There is no assurance we will or can continue to obtain such financing.  We may have to seek alternate financing which will likely dilute the existing shareholders’ value.

 

We will continue to incur claims, liabilities and expenses that will reduce the amount available for distribution to stockholders.

 

Claims, liabilities and expenses incurred while seeking a private company transaction or any subsequent dissolution, such as legal, accounting and consulting fees and miscellaneous office expenses, will reduce the amount of assets available for future distribution to stockholders. If available cash and amounts received on the sale of non-cash assets are not adequate to provide for our obligations, liabilities, expenses and claims, we may not be able to distribute meaningful cash, or any cash at all, to our stockholders.

 

We will continue to incur the expenses of complying with public company reporting requirements.

 

We have an obligation to continue to comply with the applicable reporting requirements of the Securities Exchange Act of 1934, as amended, even though compliance with such reporting requirements is economically burdensome.

 

Our auditors have expressed a going concern opinion.

 

Primarily as a result of our recurring losses and our lack of liquidity, our independent auditor’s report includes an explanatory paragraph describing the substantial doubt as to our ability to continue as a going concern.

 

  Any future sale of a substantial number of shares of our common stock could depress the trading price of our common stock.

 

Any sale of a substantial number of shares of our common stock (or the prospect of sales) may have the effect of depressing the trading price of our common stock. In addition, these sales could lower our value.

 

Our stock price is likely to be highly volatile because of several factors, including a limited public float.

 

The market price of our stock is likely to be highly volatile because there has been no trading in the past and there may be relatively thin trading market for our stock, which causes trades of small blocks of stock to have a significant impact on our stock price. You may not be able to resell our common stock following periods of volatility because of the market's adverse reaction to volatility.

 

 Other factors that could cause such volatility may include, among other things:

 

announcements concerning our strategy;

 

litigation; and

 

general market conditions.

 

Because our common stock is considered a "penny stock" any investment in our common stock is considered to be a high-risk investment and is subject to restrictions on marketability.

 

Our common stock is currently listed on the OTC Bulletin Board and Pink Sheets and is considered a "penny stock." The OTC Bulletin Board and Pink Sheets are generally regarded as a less efficient trading market than the NASDAQ Capital Market.

 

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in "penny stocks." Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. The broker-dealer also must provide the customer with bid and offer quotations for the penny stock, the compensation of the broker-dealer and any salesperson in the transaction, and monthly account statements indicating the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that, prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our common stock.

 

Since our common stock is subject to the regulations applicable to penny stocks, the market liquidity for our common stock could be adversely affected because the regulations on penny stocks could limit the ability of broker-dealers to sell our common stock and thus your ability to sell our common stock in the secondary market.  There is no assurance our common stock will be quoted on NASDAQ or the NYSE or listed on any exchange, even if eligible.

 

Item 1B.  Unresolved Staff Comments

 

 None.

 

Item 2.  Properties.

 

We own no real estate.   Our corporate offices are located at 6462 Little River Turnpike, Suite E, Alexandria, Virginia.

 

Item 3.  Legal Proceedings.

 

We have no outstanding, material legal proceedings.

 

Item 4.  (Removed and Reserved)

PART II

 

Item 5.  Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

 

Public Market for Common Stock

 

Our common stock is quoted on the OTC Bulletin Board under “AMAS.OB” and on the OTC Markets under the symbol "AMAS.QB."  Our Common Stock, par value $.01 per share (“Common Stock”), has minimal trading volume.  

 

The following table sets forth, for the fiscal quarters indicated, the high and low bid information for our common stock, as reported on the OTC Bulletin Board and the OTC Markets.  The following quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions.

 

Quarterly period		High				Low
Fiscal year ended June 30, 2011:
First Quarter		$	.0001			$	.0001
Second Quarter		$	.0001			$	.0001
Third Quarter		$	.1500			$	.0001
Fourth Quarter		$	.2500			$	.0700
Fiscal year ended June 30, 2012:
First Quarter		$	.0800			$	.0500
Second Quarter		$	.0500			$	.0400
Third Quarter		$	.0500			$	.0300
Fourth Quarter		$	.0500			$	.0400

 

Holders

On September 7, 2012, the closing sales price of our common stock as reported on the Over-The-Counter Bulletin Board was $0.035 per share.  As of September 7, 2012, there were approximately 429 record holders of the Company's Common Stock.  Our transfer agent is American Stock Transfer and Trust Company LLC.

 Dividends

Holders of common stock are entitled to receive such dividends as the BOD may from time to time declare out of funds legally available for the payment of dividends.  No dividends have been paid on our common stock, and we do not anticipate paying any dividends on our common stock in the foreseeable future. 

Recent Sale of Unregistered Securities.

 

On August 31, 2011, the Corporation received an infusion of $10,000 in order to continue its operations in the near-term. The Company executed a $10,000 note with Mr. Chip Brian, pursuant to which Mr. Brian advanced the Company $10,000 at a rate of 12% per annum. Additionally, the Company granted 1,000,000 shares of restricted common stock and a warrant to purchase an additional 1,000,000 shares of restricted common stock at an exercise price of $0.01 per share as an inducement for Mr. Brian to make the loan.

 

On August 9, 2012, the Corporation received an infusion of $10,000 in order to continue its operations in the near-term. The Company executed a $10,000 note with Mr. Chip Brian, pursuant to which Mr. Brian advanced the Company $10,000 at a rate of 12% per annum. Additionally, the Company granted 1,000,000 shares of restricted common stock and a warrant to purchase an additional 1,000,000 shares of restricted common stock at an exercise price of $0.01 per share as an inducement for Mr. Brian to make the loan.

 

Item 6.  Selected Financial Data.

Not Applicable

Item 7.   Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

The following discussion should be read in conjunction with the Financial Statements and notes thereto included in Item 8 of Part II of this Annual Report on Form 10-K.

 

FORWARD-LOOKING STATEMENTS

 

All statements other than statements of historical fact included in "Management's Discussion and Analysis of Financial Condition and Results of Operations" are forward-looking statements. Forward-looking statements involve various important assumptions, risks, uncertainties and other factors which could cause our actual results to differ materially from those expressed in such forward-looking statements. Forward-looking statements in this discussion can be identified by words such as "anticipate," "believe," "could," "estimate," "expect," "plan," "intend," "may," "should" or the negative of these terms or similar expressions. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, performance or achievement. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors including but not limited to, competitive factors and pricing pressures, changes in legal and regulatory requirements, cancellation or deferral of customer orders, technological change or difficulties, difficulties in the timely development of new products, difficulties in manufacturing, commercialization and trade difficulties and general economic conditions as well as the factors set forth in our public filings with the Securities and Exchange Commission.

 

You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this Annual Report or the date of any document incorporated by reference, in this Annual Report.  We are under no obligation, and expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.

 

For these statements, we claim the protection of the safe harbor for forward-looking statements contained in Section 21E of the Securities Exchange Act of 1934.

 

Overview

 

AMASYS was incorporated in Delaware in 1992, and in 1996 received all remaining assets of Infotech following the completion of Infotech’s Chapter 11 Bankruptcy reorganization, in accordance with an Assignment and Assumption Agreement, dated October 11, 1996, and effective as of June 21, 1996.  As a result of a series of transactions during the 1980’s, Infotech, then principally engaged in the information and communications business, acquired equity interests in Comtex and Analex, formerly known as Hadron, Inc.  Our business was the maintenance of our equity interest in and note receivable from Comtex and equity interest in Analex.  

 

On September 25, 2006, we exchanged the equity investment in Comtex common stock and the Note Receivable from Comtex of $856,954, for 55,209 shares of the AMASYS Series A Preferred stock.  We no longer have an equity interest in either the common stock of Comtex or the Note from Comtex.

 

During October 2006, we sold the remaining 21,000 shares of common stock of publicly-held Analex, a defense contractor specializing in systems engineering and developing innovative technical intelligence solutions in support of U.S. national security.  We no longer have an equity interest in Analex.

 

Since we redeemed and converted all of our outstanding Series A Preferred Stock at the end of September 2006, starting October 1, 2006 we have not conducted any business operations.  All of our operating results and cash flows reported in the accompanying financial statements from October 1, 2006 are considered to be those related to development stage activities and represent the 'cumulative from entering developmental stage' amounts from its development stage activities required to be reported pursuant to Financial Accounting Standards Board Accounting Standards Codification (“ASC”) Topic 915 “Development Stage Entities”.

 

Recently Issued Accounting Pronouncements

 

Refer to the notes to the financial statements for a complete description of recent accounting standards which we have not yet been required to implement and may be applicable to our Company, as well as those significant accounting standards that have been adopted during the current year.

 

Critical Accounting Policies

 

The preparation of our financial statements in conformity with accounting principles generally accepted in the United States of America ("US GAAP") requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of expenses during the reporting period. On an ongoing basis, we evaluate our estimates which are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. The result of these evaluations forms the basis for making judgments about the carrying values of assets and liabilities and the reported amount of expenses that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions. The following accounting policies require significant management judgments and estimates:

 

We account for our business acquisitions under the purchase method of accounting in accordance with Financial Accounting Standards Board (“FASB”) Codification Topic 805, "Business Combinations." The total cost of acquisitions is allocated to the underlying net assets, based on their respective estimated fair values. The excess of the purchase price over the estimated fair value of the tangible net assets acquired is recorded as intangibles. Determining the fair value of assets acquired and liabilities assumed requires management's judgment and often involves the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates, asset lives, and market multiples, among other items.

 

We base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. There can be no assurance that actual results will not differ from these estimates.

 

Certain reclassifications have been made to the prior fiscal year amounts disclosed in the consolidated financial statements to conform to the presentation for the fiscal year ended June 30, 2012. These reclassifications had no effect on the reported net loss or stockholders’ equity.

 

Results of Operations

 

Comparison of the fiscal year ended June 30, 2012 to the fiscal year ended June 30, 2011

 

We had a net loss of $68,370 for the year ended June 30, 2012 compared to a net loss of $59,044 for the year ended June 30, 2011.  The change is explained below.

 

General and administrative costs:  G&A expenses decreased approximately $14,236 from $41,946 in the fiscal year 2011 to $27,710 in fiscal year 2012 primarily due to a decrease in professional fees.

 

Other income (expense):  Other expense increased $23,562 from other expense of $17,098 in fiscal year 2011 to other expense of $40,660 in fiscal year 2012, primarily due to the additional interest expense accrued on our additional notes payable from related party and interest expense recorded for shares issued as an inducement for loan financing.

 

Liquidity and Capital Resources

 

We have had minimal operating activity since commencing operations in 1996 and are now relying on loans from related parties as funding sources since we can no longer expect to meet our short-term obligations.

 

Net cash used in operating activities was $18,861 and $37,697 in the years ended June 30, 2012 and 2011, respectively.

 

Net cash provided by investing activities was $0 and $0 in the years ended June 30, 2012 and 2011, respectively.  

 

Net cash provided by financing activities was $17,000 and $40,000 in the years ended June 30, 2012 and 2011, respectively.

 

We suffered recurring losses from operations and have an accumulated deficit of $752,543 at June 30, 2012.  Currently, we are a non-operating public company. We seek suitable candidates for a business combination with a private company.  In the event we use all of our cash resources, C.W. Gilluly has indicated the willingness to loan us funds at the prevailing market rate, assuming we find a suitable candidate for a business combination, until such business combination is consummated.  Even though this is Mr. Gilluly's current intention, he has made no firm commitment and it is at his sole discretion whether or not to fund us.  In the event Mr. Gilluly does not fund us, we will not have the funds necessary to operate and will have to dissolve.

 

Going Concern Uncertainties

 

As of the date of this annual report, there is substantial doubt regarding our ability to continue as a going concern as we have not generated sufficient cash flow to fund our business operations and loan commitments.  Our future success and viability, therefore, are dependent upon our ability to generate capital financing.  The failure to generate sufficient revenues or raise additional capital may have a material and adverse effect upon the Company and our shareholders.

 

Commitments and Contractual Obligations

 

As of June 30, 2012, we have no contractual obligations.

 

Off-Balance Sheet Arrangements

 

As of June 30, 2012, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K. No unaudited quarterly operating data is included in this Form 10-K as we conducted no operations from entering development stage through June 30, 2012.

 

Item 7A.   Quantitative and Qualitative Disclosures about Market Risk.

 

Market risk represents the risk of loss arising from adverse changes in market rates and foreign exchange rates. At June 30, 2012, we had outstanding notes payable totaling $157,000 plus accrued interest of $70,770 to two related parties. The amount of our outstanding debt at any time may fluctuate and we may from time to time be subject to refinancing risk. A hypothetical 100 basis point increase in interest rates would have a material effect on our annual interest expense, our results of operations or financial condition as we rely on these notes to sustain our operations.  Since we do not have transactions in foreign currencies, we do not consider it necessary to hedge against currency risk. 

 

 

Item 8.

 

   Financial Statements and Supplementary Data. 

 

INDEX TO FINANCIAL STATEMENTS AND SCHEDULES

 

AMASYS CORPORATION

(a development stage company)

 

Report of Independent Registered Public Accounting Firm	13
Balance Sheets as of June 30, 2012 and 2011	14
Statements of Operations for the years ended June 30, 2012 and 2011 and for the period October 1, 2006 (date of entering development stage) through June 30, 2012	15
Statements of Stockholders’ Equity (Deficit) for the years ended June 30, 2012 and 2011 and for the period October 1, 2006 (date of entering development stage) through June 30, 2012	16
Statements of Cash Flows for the years ended June 30, 2012 and 2011 and for the period October 1, 2006 (date of entering development stage) through June 30, 2012	17
Notes to Financial Statements	18-25

 

 

 

Report of Independent Registered Public Accounting Firm

 

 

To the Board of Directors and Stockholders

Amasys Corporation

(A Development Stage Company)

 

 

We have audited the accompanying balance sheets of Amasys Corporation (A Development Stage "Company") as of June 30, 2012 and 2011 and the related statements of operations, changes in stockholders' deficit and cash flows for the years then ended and for the period from October 1, 2006 (Inception) through June 30, 2012. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

 

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company was not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

 

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Amasys Corporation as of June 30, 2012 and 2011, and the result of its operations and its cash flows for the year then ended and for the period from October 1, 2006 (Inception) through June 30, 2012 in conformity with U.S. generally accepted accounting principles.

  

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has had no revenues and income since inception. These conditions, among others, raise substantial doubt about the Company’s ability to continue as a going concern. Management's plans concerning these matters are also described in Note 1, which includes the raising of additional equity financing or merger with another entity. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

 /s/Anton & Chia

____________________

Anton & Chia, LLP

 

Newport Beach, CA

September 7, 2012

AMASYS Corporation

(a development stage company)

Balance Sheets

 

 

 

		June 30,				June 30,
		2012				2011
ASSETS
CURRENT ASSETS
Cash		$	564			$	2,425
TOTAL ASSETS		$	564			$	2,425

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT
CURRENT LIABILITIES:
Accounts payable and accrued expenses		$	37,100			$	28,250
Accounts payable, related parties			24,500				24,500
Notes payable and accrued interest, related parties			227,770				190,111
TOTAL CURRENT LIABILITIES			289,370				242,861
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ DEFICIT:
Preferred stock, $.01 par value, 1,000,000 shares authorized, no shares issued and outstanding at June 30, 2012 and 2011, respectively			—				—
Common stock, $.01 par value, 20,000,000 shares authorized, 13,669,210 and 12,669,210 shares issued and outstanding at June 30, 2012 and 2011, respectively			136,692				126,692
Additional paid in capital			327,045				317,045
Accumulated deficit			(752,543	)			(684,173	)
Total stockholders’ deficit			(288,806	)			(240,436	)
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT		$	564			$	2,425

 

 

 

 

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

 

 

AMASYS Corporation

(a development stage company)

Statements of Operations

 

 

		Year Ended June 30,								Period from October 1, 2006 (date of entering development stage) through June 30,
		2012				2011				2012
REVENUES		$	—			$	—			$	—
COST OF SALES			—				—				—
GROSS PROFIT			—				—				—
OPERATING EXPENSES
General and administrative expenses			27,710				41,946				290,602
Total operating expenses			27,710				41,946				290,602
LOSS FROM OPERATIONS			(27,710	)			(41,946	)			(290,602	)
OTHER INCOME (EXPENSE):
Interest expense			(40,660	)			(17,098	)			(90,912	)
Stock issued for loans			—				—				(20,000	)
Gain on sale of investment			—				—				12,734
Total other expense			(40,660	)			(17,098	)			(98,178	)
LOSS BEFORE PROVISION FOR INCOME TAXES			(68,370	)			(59,044	)			(388,780	)
Provision for income taxes			—				—				—
NET LOSS APPLICABLE TO COMMON STOCKHOLDERS		$	(68,370	)		$	(59,044	)		$	(388,780	)
NET LOSS PER SHARE OF COMMON STOCK
EPS – Basic and diluted		$	(0.01	)		$	(0.01	)
WEIGHTED AVERAGE SHARES OUTSTANDING—Basic and diluted			13,467,471				8,696,607

 

 

 

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

 

 

AMASYS Corporation

(a development stage company)

Statements of Stockholders' Equity (Deficit)

  

		Preferred Stock								Common Stock
		Issued Shares				Par Value				Issued Shares				Par Value				Additional Paid-In Capital				Accumulated Other Comprehensive Income				(Accumulated Deficit) Retained Earnings				Accumulated Deficit During Development Stage				Total Stockholders’ Equity (Deficit)
Balance – October 1, 2006			--			$	--				--			$	--			$	317,045			$	37,773			$	(363,762	)		$	--			$	57,748
Recognition of loss on sale of marketable equity securities			--				--				--				--				--				(37,773	)			--				--				(37,773	)
Net loss			--				--				--				--				--				--				--				(46,218	)			(46,218	)
Comprehensive loss																																			(83,991	)
Balance – June 30, 2007			--			$	--				6,669,210			$	66,692			$	317,045			$	--			$	(363,762	)		$	(46,218	)		$	(26,243	)
Net loss			--				--				--				--				--				--				--				(48,186	)			(48,186	)
Balance – June 30, 2008			--			$	--				6,669,210			$	66,692			$	317,045			$	--			$	(363,762	)		$	(94,404	)		$	(74,429	)
Net loss			--				--				--				--				--				--				--				(111,762	)			(111,762	)
Balance – June 30, 2009			--			$	--				6,669,210			$	66,692			$	317,045			$	--			$	(363,762	)		$	(206,166	)		$	(186,191	)
Net Loss																															(55,201	)			(55,201	)
Balance – June 30, 2010			--			$	--				6,669,210			$	66,692			$	317,045			$	--			$	(363,762	)		$	(261,367	)		$	(241,392	)
Exercise of warrants											2,000,000				20,000					-															20,000
Conversion of debt											4,000,000				40,000																				40,000
Net loss																															(59,044	)			(59,044	)
Balance – June 30, 2011											12,669,210				126,692				317,045								(363,762	)			(320,411	)			(240,436	)
Issuance of stock for note inducement											1,000,000				10,000				10,000																20,000
Net loss																															(68,370	)			(68,370	)
Balance – June 30, 2012											13,669,210				136,692				327,045								(363,762	)			(388,781	)			(288,806	)

 

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

 

 

AMASYS Corporation

(a development stage company)

Statements of Cash Flows

 

		Year Ended June 30,								Period from October 1, 2006 (date of entering development stage) through June 30,
		2012				2011				2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss		$	(68,370	)		$	(59,044	)		$	(388,781	)
Adjustments to reconcile net loss to net cash used in operating activities:
Inducement of note payable – stock issued			20,000				—				40,000
Gain on sale of short term investment			—				—				(12,734	)
Changes in operating assets and liabilities:
Accounts payable, related parties			—				—				16,972
Accounts payable and accrued expenses			29,509				21,347				80,788
Net cash used in operating activities			(18,861	)			(37,697	)			(263,755	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Net proceeds from sale of short term investment			—				—				40,570
Net cash provided by investing activities			—				—				40,570
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock			—				—				3,500
Proceeds from notes payable, related parties			17,000				40,000				217,000
Net cash provided by financing activities			17,000				40,000				220,500
NET INCREASE / (DECREASE) IN CASH			(1,861	)			2,303				(2,685	)
CASH Beginning of period			2,425				122				3,249
CASH End of period		$	564			$	2,425			$	564

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest expense		$	—			$	—			$	—
Notes payable, related party used to exercise warrants			20,000				—				20,000

 

 

 

 

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

 

 

 

AMASYS Corporation

(a development stage company)

Notes to Financial Statements

  

Note 1 – ORGANIZATION AND BASIS OF PRESENTATION

 

AMASYS Corporation (the “Company”, “We” or “Our”) was incorporated in Delaware in 1992, and in 1996 received all of the remaining assets of Infotechnology, Inc. (“Infotech”), a Delaware company, following the completion of Infotech’s Chapter 11 Bankruptcy reorganization, in accordance with an Assignment and Assumption Agreement, dated October 1, 1996 and effective as of June 21, 1996.

 

Basis of Presentation and Going Concern Uncertainty

 

Our financial statements have been prepared assuming that we will continue as a going concern.  However, we have sustained recurring losses and as of June 30, 2012, we have no business operations and have a net working capital deficiency.  These conditions, among others, give rise to substantial doubt about our ability to continue as a going concern.  Management is continuing to seek additional equity capital to fund a merger or acquisition or to purchase an ongoing business.  Until such time, we anticipate our working capital needs will be funded through notes from our major stockholders.  Management believes these steps will provide us with adequate funds to sustain our continued existence.  There is, however, no assurance that the steps taken by management will meet all of our needs or that we will continue as a going concern.  The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Development Stage Activities

 

Since we redeemed and converted all of our outstanding Series A Preferred Stock at the end of September 2006, starting October 1, 2006 we have not conducted any business operations. All of our operating results and cash flows reported in the accompanying financial statements from October 1, 2006 through June 30, 2012 are considered to be those related to development stage activities and represent the 'cumulative from inception' amounts from our development stage activities required to be reported pursuant to Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 915, Development Stage Entities.

 

Note 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Use of Estimates

 

The preparation of 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 financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

 

Cash and Cash Equivalents

  

The Company maintains deposits in a financial institution.  The Federal Deposit Insurance Corporation provides coverage for interest bearing and noninterest bearing transaction accounts of up to $250,000 through December 31, 2013.  At June 30, 2012, none of the Company’s cash was in excess of federally insured limits.

 

  Concentrations of Credit Risk

 

Financial instruments that potentially subject us to a concentration of credit risk consist of cash. We maintain our cash with high credit quality financial institutions; at times, such balances with any one financial institution may exceed FDIC insured limits.

Income Taxes

 

We account for income taxes in accordance with ASC Topic 740, Income Taxes.  Under this standard, deferred tax liabilities and assets are determined based on the difference between the financial statement and tax bases of assets and liabilities using the enacted tax rates in effect for the year in which the differences are expected to reverse.  Deferred tax assets are reduced by a valuation allowance when we cannot make the determination that it is more likely than not that some portion or all of the related tax asset will be realized.

 

Stock-Based Compensation

 

Stock based compensation is accounted for in accordance with ASC Topic 718, Stock Compensation.  The Company records as expense the fair value of equity-based compensation, including stock options, over the applicable vesting period.

 

Comprehensive Income (Loss)

 

Comprehensive income (loss) is defined as the change in equity of a business enterprise during a period from non-owner sources. Our comprehensive income (loss) included unrealized gains (losses) on its short-term investment, as well as reclassification adjustments resulting from gains on sales of short-term investments that were realized and included in net income in the related period.  In accordance with ASC Topic 220, Comprehensive Income, these gains had also been included in Other Comprehensive Income as unrealized holding gains in the period in which they arose.  These gains were, therefore, deducted from Other Comprehensive Income to avoid including them twice.

 

Net Loss Per Share

 

Basic net loss and diluted loss per share (“EPS”) is computed by dividing net loss available to common stockholders by weighted average common shares outstanding.  Diluted EPS is computed similarly, except that it includes the assumed exercise of stock options as long as the effect is not anti-dilutive.  For the years ended June 30, 2012 and 2011, the effect of the assumed exercise of the stock options were not included in the net loss per share calculations because the inclusion would have been anti-dilutive.

 

 

Fair value of financial instruments

 

Our financial instruments consist of cash, accounts payable, accrued expenses and notes payable.  The carrying values of cash, accounts payable, accrued expenses and notes payable are representative of their fair values due to their short-term maturities.

 

Fair value measurements

 

ASC Topic 820 defines fair value, establishes a framework for measuring fair value, establishes a three-level valuation hierarchy for disclosure of fair value measurement and enhances disclosure requirements for fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows:

 

Level 1 - Inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

 

Level 2 - Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

 

Level 3 - Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

Management believes it is not practical to estimate the fair value of notes payable to related parties because the transactions cannot be assumed to have been consummated at arm's length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practical due to the lack of data regarding similar instruments, if any, and the associated potential costs. 

 

Recent Accounting Guidance Adopted

 

In May 2011, the FASB issued guidance to amend the accounting and disclosure requirements on fair value measurements. The new guidance limits the highest-and-best-use measure to nonfinancial assets, permits certain financial assets and liabilities with offsetting positions in market or counterparty credit risks to be measured at a net basis, and provides guidance on the applicability of premiums and discounts. Additionally, the new guidance expands the disclosures on Level 3 inputs by requiring quantitative disclosure of the unobservable inputs and assumptions, as well as description of the valuation processes and the sensitivity of the fair value to changes in unobservable inputs. The new guidance will be effective for us beginning January 1, 2012. The Company's adoption of this accounting guidance did not have a material impact on its financial statements and related disclosures. 

 

Recent Accounting Guidance Not Yet Adopted

 

In September 2011, the FASB issued guidance on testing goodwill for impairment. The new guidance provides an entity the option to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If an entity determines that this is the case, it is required to perform the currently prescribed two-step goodwill impairment test to identify potential goodwill impairment and measure the amount of goodwill impairment loss to be recognized for that reporting unit (if any). If an entity determines that the fair value of a reporting unit is less than its carrying amount, the two-step goodwill impairment test is not required. The new guidance will be effective for us beginning July 1, 2012 and we do not anticipate adoption of this accounting standard will have a material effect on our financial statements and related disclosures.

 

In June 2011, the FASB issued guidance on presentation of comprehensive income. The new guidance eliminates the current option to report other comprehensive income and its components in the statement of changes in equity. Instead, an entity will be required to present either a continuous statement of net income and other comprehensive income or in two separate but consecutive statements. The new guidance will be effective for us beginning July 1, 2012 and we do not anticipate adoption of this accounting standard will have a material effect on our financial statements and related disclosures.

 

The FASB issued Accounting Standards Update (ASU) No. 2012-02—Intangibles—Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment, on July 27, 2012, to simplify the testing for a drop in value of intangible assets such as trademarks, patents, and distribution rights. The amended standard reduces the cost of accounting for indefinite-lived intangible assets, especially in cases where the likelihood of impairment is low. The changes permit businesses and other organizations to first use subjective criteria to determine if an intangible asset has lost value. The amendments to U.S. GAAP will be effective for fiscal years starting after September 15, 2012. Early adoption is permitted. We are currently evaluating the impact of adopting ASU 2012-02 on the financial statements.

 

NOTE 3 – NOTE PAYABLE RELATED PARTIES AND ACCRUED INTEREST

 

Notes payable:

 

A summary of the notes payable activity is as follows:

Balance, June 30, 2011		$	140,000
Additional notes payable issued			17,000
Balance, June 30, 2012		$	157,000

 

Accrued interest:

 

A summary of the accrued interest activity is as follows:

 

Balance, June 30, 2011		$	50,112
Accrued interest for the year ended June 30, 2012			20,658
Balance, June 30, 02012		$	70,770

 

Historically, all interest payable incurred is from interest incurred at the stated rate of promissory notes issued by the Company. The payment terms, security and any interest payable are based on the underlying promissory notes payable that the Company has outstanding.

 

During the year ended June 30, 2007, we received $10,000 from Private Capital Group, L.L.C., a shareholder of the Company. This note had an interest rate of 10% per annum, was unsecured and had an original due date of December 31, 2007. The note was extended with the same terms and a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $3,252 and is due at maturity. Accrued interest is included in the notes payable, related parties balance. As an inducement to make the loan, we issued 1,000,000 shares of restricted common stock with a fair market value of $10,000 (par value) and issued a warrant for an additional 1,000,000 shares of restricted common stock with an exercise price of $0.01 per share. The warrants were estimated to have no significant fair market value.

 

During the year ended June 30, 2007, we received $10,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 10% per annum, is unsecured and had an original due date of December 31, 2007. The note was extended with the same terms and a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $3,252 and is due at maturity. Accrued interest is included in the notes payable, related parties balance. As an inducement to make the loan, we issued 1,000,000 shares of restricted common stock with a fair market value of $10,000 (par value) and issued a warrant for an additional 1,000,000 shares of restricted common stock with an exercise price of $.01 per share. The warrants were estimated to have no significant fair market value.

 

On August 24, 2010, these warrants were exercised by using the $10,000 note payable, related party loan balances issued on May 24, 2007 to C.W. Gilluly and Private Capital Group, in lieu of cash. In this transaction, 2,000,000 shares of common stock were issued for a par value of $0.01.

 

During the year ended June 30, 2008, we received an additional $15,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and had an original due date of December 31, 2009. The note was extended with the same terms and a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $8,328 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

During the year ended June 30, 2008, we received an additional $5,000 from Private Capital Group, L.L.C., a shareholder of the Company. This note has an interest rate of 12% per annum, is unsecured and had an original due date of December 31, 2009. The note was extended with the same terms and a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $2,661 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

During the year ended June 30, 2008, we received an additional $15,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and had an original due date of December 31, 2009. The note was extended with the same terms and a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $7,244 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

During the year ended June 30, 2009, we received an additional $25,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and had an original due date of December 31, 2009. The note was extended with the same terms and a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $11,373 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

During the year ended June 30, 2009, we received an additional $40,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and had an original due date of December 31, 2009. The note was extended with the same terms and a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $17,438 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

During the year ended June 30, 2009, we received an additional $10,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and had an original due date of December 31, 2009. The note was extended with the same terms and a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $3,929 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

During the year ended June 30, 2010, we received an additional $15,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and has a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $5,079 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

During the year ended June 30, 2010, we received an additional $5,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and has a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $1,604 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

During the year ended June 30, 2010, we received an additional $5,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and has a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $1,461 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

During the year ended June 30, 2010, we received an additional $5,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and has a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $1,332 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

During the year ended June 30, 2011, we received an additional $10,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and has a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $1,012 and is due at maturity. Accrued interest is included in the notes payable and accrued interest, related parties balance.

 

During the year ended June 30, 2011, we received an additional $10,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and has a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $717 and is due at maturity. Accrued interest is included in the notes payable and accrued interest, related parties balance.

 

During the year ended June 30, 2011, we received an additional $15,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and has a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $621 and is due at maturity. Accrued interest is included in the notes payable and accrued interest, related parties balance.

 

During the year ended June 30, 2011, we received an additional $5,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and has a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $59 and is due at maturity. Accrued interest is included in the notes payable and accrued interest, related parties balance.

 

On May 31, 2011, Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer, converted $40,000 of the most recent notes into 4,000,000 shares of the Company’s restricted stock common stock.

On August 31, 2011, the Corporation received an infusion of $10,000 in order to continue its operations in the near-term. The Company executed a $10,000 due on demand note with Mr. Chip Brian, pursuant to which Mr. Brian advanced the Company $10,000 at a rate of 12% per annum. Both the principal and interest are payable to Mr. Brian on or before December 31, 2012. Additionally, the Company granted 1,000,000 shares of restricted common stock and a warrant to purchase an additional 1,000,000 shares of restricted common stock at an exercise price of $0.01 per share as an inducement for Mr. Brian to make the loan. The Company recorded $20,000 of interest expense related to the shares issued. As of June 30, 2012, accrued interest payable totaled $999 and is due at maturity. Accrued interest is included in the notes payable and accrued interest, related parties balance.

 

On January 23, 2012, we received an additional $5,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and has a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $261 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

On April 25, 2012, we received an additional $2,000 from Dr. C.W. Gilluly, our Chairman of the Board, President and Chief Executive Officer. This note has an interest rate of 12% per annum, is unsecured and has a due date of December 31, 2013. As of June 30, 2012, accrued interest payable totaled $43 and is due at maturity. Accrued interest is included in the notes payable, related parties balance.

 

 

NOTE 4 – INCOME TAXES

 

The following table reconciles the Company’s statutory tax rate to the effective tax rate:

 

	2012									2011
Tax benefit (expense) at statutory rate		$	23,000				34	%		$	20,000				34	%
Reconciling items:
State income taxes			2,700				4	%			2,300				4	%
Valuation allowance			(25,700	)			(38	)%			(22,300	)			(38	)%
Effective tax rate		$	—				0	%		$	—				0	%

 

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.  Significant components of deferred tax assets as of June 30, 2012 and 2011 are as follows:

 

		June 30, 2012				June 30, 2011
Deferred tax assets:
Net operating losses carryforwards		$	516,179			$	491,129
Total deferred tax assets			516,179				491,129
Deferred tax liabilities:			-0-				-0-
Total deferred tax liabilities			-0-				-0-
Net deferred tax asset			516,179				491,129
Valuation allowance			(516,179	)			(491,129	)
Deferred tax asset, net		$	—			$	—

 

A reconciliation of net loss per books with net loss per return is as follows

		June 30,
		2012				2011
Net loss, per books		$	(68,370	)		$	(59,044	)
Income subject to tax not recorded on the books:
(Income) expense recorded on the books not included on the return:
Net loss, per return		$	(68,370	)		$	(59,044	)

 

Income tax expense, per return		$	-0-			$	-0-
Available net operating loss (NOL) carryover from prior tax years			1,340,417				1,281,373
NOL generated			68,370				59,044
Total NOL carryover to future years			1,408,787				1,340,417
NOL expiring			-0-				-0-
NOL available to future years		$	1,408,787			$	1,340,417

 

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some, or all, of the deferred tax asset will not be realized.  The ultimate realization of the deferred tax asset is dependent upon the generation of future taxable income during the periods in which the net operating loss carryforwards are available.  Management considers projected future taxable income, the scheduled reversal of deferred tax liabilities and available tax planning strategies that can be implemented by the Company in making this assessment.  Based upon the level of historical taxable income and projections for future taxable income over the periods in which the net operating loss carryforwards are available to reduce income taxes payable, management has established a valuation allowance such that the net deferred tax asset is $0 as of June 30, 2012.  The net change in the valuation allowance during the year ended June 30, 2012 was an increase of approximately $25,000.

 

As of June 30, 2012 we had net operating loss carryforwards for federal income tax purposes of $1,408,787, which will expire through 2031.  Utilization of these net operating losses may be subject to limitations under IRC Section 382, in the event of significant changes in our stock ownership.  To the extent that we are able to utilize available tax loss carryforwards that arose from operations in tax years prior to June 30, 1996, any benefit realized will be credited to additional paid in capital.  

 

In June 2006, FASB issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes-an Interpretation of FASB Statement No. 109" ("FIN 48") which was codified as ASC Topic 740. ASC Topic 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. The Company determined the adoption to have no effect on results of operations or financial position at or for the year ended June 30, 2012 or 2011. The Company will record any future penalties and tax related interest expense as a component of provision for income taxes.

 

Note 5 – STOCKHOLDERS’ EQUITY

 

During the year ended June 30, 2007, we issued two warrants as part of an incentive for two notes payable from related parties.  The warrants were for the purchase of 2,000,000 shares of restricted common stock at an exercise price of $.01.  On August 24, 2010, these warrants were exercised by using the $10,000 note payable, related party loan balances issued on May 24, 2007 to C.W Gilluly and Private Capital Group, in lieu of cash.  In this transaction, 2,000,000 shares of common stock were issued for a par value of $0.01.

 

On May 31, 2011, C.W. Gilluly converted $40,000 in loans into 4,000,000 shares of restricted common stock.

On August 31, 2011, the Corporation received an infusion of $10,000 in order to continue its operations in the near-term. The Company executed a $10,000 note with Mr. Chip Brian, pursuant to which Mr. Brian advanced the Company $10,000 at a rate of 12% per annum. Both the principal and interest are payable to Mr. Brian on or before December 31, 2012. Additionally, the Company granted 1,000,000 shares of restricted common stock and a warrant to purchase an additional 1,000,000 shares of restricted common stock at an exercise price of $0.01 per share as an inducement for Mr. Brian to make the loan.

  

Note 6 – STOCK WARRANTS

 

During the year ended June 30, 2007, we issued two (2) warrants as part of an incentive for two notes payable, related parties.  The warrants were for the purchase of 2,000,000 shares of restricted common stock at an exercise price of $.01.   On August 24, 2010, these warrants were exercised by using the $10,000 note payable, related party loan balances issued on May 24, 2007 to C.W Gilluly and Private Capital Group, in lieu of cash.  In this transaction, 2,000,000 shares of common stock were issued for a par value of $0.01.

 

Accept as set forth in Note 5, we did not issue any warrants for the years ended June 30, 2012 and 2011.

 

Note 7 – COMMITMENTS AND CONTINGENCIES

 

The Company has issued notes payable to related parties which are due December 31, 2013.  Notes payable, related parties and the related accrued interest due at June 30, 2012 is $227,770.

 

Note 8 – SUBSEQUENT EVENTS

 

On August 9, 2012, the Corporation received an infusion of $10,000 in order to continue its operations in the near-term. The Company executed a $10,000 note with Mr. Chip Brian, pursuant to which Mr. Brian advanced the Company $10,000 at a rate of 12% per annum. Both the principal and interest are payable to Mr. Brian on or before December 31, 2013. Additionally, the Company granted 1,000,000 shares of restricted common stock and a warrant to purchase an additional 1,000,000 shares of restricted common stock at an exercise price of $0.01 per share as an inducement for Mr. Brian to make the loan.

 

Item 9.  Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

 

On November 3, 2010, Amasys dismissed Turner, Stone & Company, L.L.P. (“Turner Stone”) as its independent registered public accounting firm.  The decision was approved by the Board of Directors.

 

The reports of Turner Stone on our financial statements for the fiscal years ended June 30, 2010 and 2009 did not contain an adverse opinion or disclaimer of opinion and were not modified as to uncertainty, audit scope, or accounting principles, except the report did contain an explanatory paragraph related to the Registrant’s ability to continue as a going concern.  During the fiscal years ended June 30, 2010 and 2009, and the subsequent period through the date of this report, there were (i) no disagreements with Turner Stone on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Turner Stone would have caused Turner Stone to make reference to the subject matter of the disagreements in connection with its report, and (ii) no “reportable events” as that term is defined in Item 304(a)(1)(v) of Regulation S-K.

 

On November 3, 2010, the Registrant engaged Anton & Chia, LLP (“Anton & Chia”) as the Registrant’s new independent registered public accounting firm.  The appointment of Anton & Chia was approved by the Registrant’s Board of Directors.

 

Item 9A.  Controls and Procedures.

 

Evaluation of Disclosure Controls and Procedures: We conducted an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. The term "disclosure controls and procedures", as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended ("Exchange Act"), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by the company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC`s rules and forms. Disclosure controls and procedures also include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

 

Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded as of June 30, 2012, that our disclosure controls and procedures are effective at a reasonable assurance level and are designed to provide reasonable assurance that the controls and procedures will meet their objectives. However, it should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

 

Management's Report on Internal Control Over Financial Reporting: Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.  The internal controls for the Company are provided by executive management's review and approval of all transactions.  Our internal control over financial reporting also includes those policies and procedures that:

 

 

(1)	pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
(2)	provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that our receipts and expenditures are being made only in accordance with the authorization of our management; and
(3)	provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

Management assessed the effectiveness of the Company's internal control over financial reporting as of June 30, 2012. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework. Management's assessment included an evaluation of the design of our internal control over financial reporting and testing of the operational effectiveness of these controls.

 

Based on this assessment, management has concluded that as of June 30, 2012, our internal control over financial reporting was effective to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles.

 

This annual report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide only management's report in this annual report.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in the Company’s internal control over financial reporting that occurred for the year ended June 30, 2012, that have materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

Item 9B.  Other Information.

 

None

 

 

PART III

 

Item 10.  Directors, Executive Officers and Corporate Governance.

 

 

Directors

 

 

 The following table contains information as of June 30, 2012 as to each Director of the Company:

 

 

Director  

Name	Since	Age	Office Held
C.W. Gilluly, Ed.D.	1992	66	Chairman of the Board, President, Chief Executive Officer and Chief Financial Officer
Robert J. Lynch, Jr. (1, 2)	1992	79	Director
Thomas E. McMahan (1, 2)	1992	69	Director

 

(1)	Member of the Audit Committee.
(2)	Member of the Compensation Committee

 

C.W. GILLULY, Ed.D. has served as Chairman of the Board, President and Chief Executive Officer of the Company since June 1992.  Dr. Gilluly served as President of Comtex from June 1992 until May 1993, as Chief Executive Officer from June 1992 until September 1997, as Chairman of the Board from June 1992 until December 2002, and as Vice-Chairman from December 2002 through June 2003.  He continues to serve as a Director of Comtex and has served as Chairman of the Board since February 2004.  Dr. Gilluly served on the Board of Directors of Analex until March 2003, where he was Chairman of the Board from October 1994 until January 2001, and also served as Chief Executive Officer from May 1993 through March 2000.

 

ROBERT J. LYNCH, JR. is the President of American & Foreign Enterprises, Inc., a private corporation managing U.S. and international investments in industrial and real estate opportunities, for whom he has worked for thirty-seven years. Mr. Lynch also serves as a Director of Comtex.  Mr. Lynch has been designated as the financial expert serving on the Audit Committee.

 

THOMAS E. MCMAHAN is the founder of McMahan Associates, a private corporation that provides strategic investment advice and counsel to the financial information industry.  From 1995 to 2000, Mr. McMahan served as senior vice president for corporate development for MERGENT, INC., a $60 million diversified financial information business.  Mr. McMahan served as General Manager of Shark Information Systems, a subsidiary of Infotechnology, Inc., in 1993 and served as Vice President for Business Development of Infotechnology, Inc. in 1990.  From 1972 through 1990, Mr. McMahan served in various capacities at McGraw-Hill/Standard & Poor’s, including Senior Vice President and Chief of Staff of Standard & Poor’s Trader Services from 1988 through 1990.

 

Executive Officer

 

As of June 30, 2012, the only executive officer of the Company who is not also a Director of the Company is S. Amber Gordon, the Corporate Secretary of the Company.

 

S. AMBER GORDON (55) was appointed corporate secretary and treasurer of the company in October 1996.  Ms. Gordon also serves as the Corporate Secretary of Comtex, a position she has held since May 1996.  Ms. Gordon has been the president of S.A. Gordon Enterprises, Inc., a financial relations and marketing communications firm, since 1985.  Ms. Gordon also served in senior management positions, the most recent of which was Executive Vice President of Analex, an information technology company serving the intelligence community, from June 1991 through August 2000.

 

Certain Legal Proceedings

 

No director, nominee for director, or executive officer of the Company has appeared as a party in any legal proceeding material to an evaluation of his ability or integrity during the past five years.

 

Board Experience

 

Our board of directors has diverse and extensive knowledge and expertise in a broad range of industries that is of particular importance to us. This knowledge and experience includes operating, acquiring, financing development stage companies. In addition, our board of directors has extensive and broad legal, auditing and accounting experience. Our board of directors has numerous years of hands-on and executive experience drawn from a wide range of disciplines. Our current director was nominated to the board of directors on the basis of the unique skills he brings to the board. We will select additional directors based upon the experience and unique skills they bring as well how these collectively enhance our board of directors. On an individual basis:

 

Section 16(a) Beneficial Ownership Reporting Compliance.

 

Section 16(a) of the Exchange Act requires the Company's directors and officers, and persons who beneficially own more than 10% of a registered class of the Company's equity securities, to file reports of beneficial ownership and changes in beneficial ownership of the Company's securities with the SEC on Forms 3, 4 and 5. Officers, directors and greater than 10% stockholders are required by SEC regulation to furnish the Company with copies of all Section 16(a) forms they file. Based solely on the Company's review of the copies of the forms received by it during the fiscal year ended June 30, 2012 and representations that no other reports were required, the Company believes that no persons who, at any time during such fiscal year, was a director, officer or beneficial owner of more than 10% of the Company's common stock failed to comply with all Section 16(a) filing requirements during such fiscal year.

 

Code of Ethics

 

We have not adopted a Code of Business Conduct and Ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions because we are not a member of any exchange that would require such a code.

 

Nominating Committee

 

We have not adopted any procedures by which security holders may recommend nominees to our Board of Directors.

 

Audit Committee

 

Our Board of Directors acts as our audit committee. Robert Lynch has been designated as our qualified financial expert.

 

Item 11.  Executive Compensation

 

Summary Compensation Table

 

The following table sets forth information concerning all compensation paid or accrued by us to our President and Chief Executive Officer, during the fiscal year ended June 30, 2012.  Neither Dr. Gilluly nor any other officer receives compensation in excess of $100,000 per year.

 

		Annual Compensation			Long-Term Compensation Awards
Name and Principal Position	Fiscal Year	Salary	Bonus		Stock Options Granted	All Other Compensation
C.W. Gilluly, Chairman, President and Chief Financial Officer	2012	—	—		—	—
	2011 2010	— —	— —		— —	— —

 

Options Exercised and Year-End Option Values

 

The following table sets forth certain information regarding the value of unexercised options held by the named executive officer as of June 30, 2012.

 

 Fiscal Year-End Option Values

Name	Shares Acquired upon Exercise of Options	Value Realized From Exercise Of Options	Number of Shares Underlying Unexercised Options at June 30, 2012 Exercisable            Unexercisable	Value of Unexercised In-the-Money Options at June 30, 2012   Exercisable             Unexercisable
C.W. Gilluly	—	—	—                      —	$—                           $—

 

 

Compensation of Directors

 

The Company pays non-employee members of the Board $500 per board meeting, and $250 per audit committee meeting, plus travel expenses incurred in connection with attendance at Board meetings.  During fiscal year 2012, each of the Company’s non-employee Directors received compensation as shown below for services rendered to the Company.

 

Director Compensation

 

Name	Fees earned or paid in cash ($) (1)	Stock awards ($)	Option awards ($)	Non-equity incentive plan compensation ($)	Nonqualified deferred compensation earnings ($)	All other compensation  ($)	Total ($)
Robert J. Lynch, Jr.	$    -	--	--	---	---	---	$ --
Thomas E. McMahan	$    -	--	--	---	---	---	$ --

 

( 1) Fees earned or paid in cash represents annual fees, annual retainer and committee fees paid to Directors.

 

Employment Agreements

 

We have no employment agreements.

 

Compensation Committee Report on Executive Compensation

 

Compensation for the President and Chief Executive Officer

 

The Committee reports that during the fiscal year ended June 30, 2012, Dr. Gilluly received payment of $-0- as compensation for his services as President and Chief Executive Officer and Chief Financial Officer of the Company.

 

Submitted by the Compensation Committee

  

Robert J. Lynch, Jr.

Thomas E. McMahan

 

Compensation Committee Interlocks and Insider Participation

 

None

 

Item 12.  Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 

The following table sets forth information as of September 7, 2012, regarding the beneficial ownership of the Company’s Common Stock of (i) each person known to the Company to be the beneficial owner, within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”), of more than 5% of the outstanding shares of Common Stock, (ii) each Director of the Company, (iii) each executive officer of the Company named in the Summary Compensation Table (see “Executive Compensation”) (iv) all executive officers and Directors of the Company as a group and (v) 14,669,210 shares of our common stock outstanding on September 7, 2012.  Unless otherwise indicated, the address of each named beneficial owner is c/o AMASYS Corp., 6462 Little River Turnpike, Suite E, Alexandria, Virginia.  Except to the extent indicated in the footnotes, each of the beneficial owners named below has sole voting and investment power with respect to the shares listed.

 

 

Name and Address of  Beneficial Owner		Amount and Nature of Beneficial Ownership				Percentage of Class (1)
Tepco Ltd. The Continental Building   25 Church Street, Hamilton HM 12, Bermuda			2,069,080				14.1	%
Private Capital Group, LLC Two Grand Central Tower 140 E. 45th Street, Suite 15C New York, NY 10017			2,000,000				13.63	%
Chip Brian			4,000,000				27.32	%
C.W. Gilluly, Chairman and CEO			6,427,048				43.81	%
Robert J. Lynch, Jr., Director			6,245 (2)				*
Thomas E. McMahan, Director			27,043	*
All Directors and Executive Officers as a group (4 persons)			6,460,991				47.27	%

* Less than 1%

(1)	Beneficial ownership is direct unless otherwise indicated and includes warrants that are exercisable within 60 days.  The percentage of beneficial ownership of all Directors and executive officers as a group is based on the sum of the total number of shares outstanding and all outstanding warrants held by Directors and executive officers that are exercisable within 60 days.
(2)	Includes 245 shares held by Mr. Lynch’s wife.

 

 

Item 13.   Certain Relationships and Related Transactions, and Director Independence.

  

Dr. Gilluly serves as our Chairman of the Board, Chief Executive Officer and Chief Financial Officer.  Dr. Gilluly also serves as Chairman of the Board of Directors of Comtex.  Mr. Lynch, a Director of the Company, also serves as a Director of Comtex.

 

Item 14.  Principal Accountant Fees and Services

 

Audit Fees

 

 During the fiscal year ended June 30, 2012 and 2011, we paid to our current principal accountant, Anton and Chia approximately $3,950 and $1,300, respectively for auditing services they performed throughout those years.

   

  Tax Fees

 

During 2012, our principal accountant did not render services to us for tax compliance, tax advice or tax planning.

 

All Other Fees

 

During 2012, there were no fees billed for products and services provided by the principal accountant other than those set forth above.

 

Policy on Audit Committee Pre-Approval of Audit and Permissible Non-audit Services of Independent Auditors

 

Consistent with SEC policies regarding auditor independence, the Audit Committee has responsibility for appointing, setting compensation and overseeing the work of the independent auditor.  In recognition of this responsibility, the Audit Committee has established a policy to pre-approve all audit and permissible non-audit services provided by the independent auditor.

 

1. Audit services include audit work performed of financial statements, as well as work that generally only the independent auditor can reasonably be expected to provide, including statutory audits, and attest services and consultation regarding financial accounting and/or reporting standards.

 

2. Audit-Related services are for assurance and related services that are reasonably related to the audit or review of our financial statements.

 

3. Tax services include all services performed by the independent auditor’s tax personnel except those services specifically related to the audit of the financial statements, and includes fees in the areas of tax compliance, tax planning, and tax advice.

 

4. Other Fees are those associated with products or services not captured in the other categories.

PART IV

 

Item 15.  Exhibits and Financial Statement Schedules.

 

(a)	The following documents are filed as a part of this Report:

 

1.	Financial Statements.   The following financial statements of AMASYS Corporation are included in Item 8:

 

Report of Independent Registered Public Accounting Firm.

 

Balance Sheets as of June 30, 2012 and 2011.

 

Statements of Operations for the year ended June 30, 2012, for the year ended June 30, 2011 and for the period October 1, 2006 (date of entering Development Stage) through June 30, 2012.

 

Statements of Stockholders’ Equity (Deficit) for the year ended June 30, 2012, for the year ended June 30, 2011 and for the period October 1, 2006 (date of entering Development Stage) through June 30, 2012.

 

Statements of Cash Flows for the year ended June 30, 2012, for the year ended June 30, 2011 and for the period October 1, 2006 (date of entering Development Stage) through June 30, 2012.

 

Notes to Financial Statements. 

 

2.	Financial Statement Schedule(s):

 

 All schedules are omitted for the reason that the information is included in the financial statements or the notes thereto or that they are not required or are not applicable.

 

3.

Exhibits:

 

 

Number				Description
	1.1			Specimen certificate for the Common Stock, $.01 par value, of the Registrant (incorporated by reference to the Company’s Form 8-A filed on October 15, 1996).
	2.1			Third Joint Chapter 11 Plan of Reorganization for Infotechnology, Inc. dated March 30, 1994, as confirmed by the Bankruptcy Court (incorporated by reference to the Company’s Form 8-A filed on October 15, 1996).
	2.2			Order Confirming Third Joint Plan of Reorganization dated as of June 23, 1994 of Infotechnology, Inc. and Questech Capital Corporation (incorporated by reference to the Company’s Form 8-A filed on October 15, 1996).
	2.3			Assignment and Assumption Agreement between the Company and Infotechnology, Inc. (incorporated by reference to the Company’s Form 8-A filed on October 15, 1996).
	3.1			Restated Certificate of Incorporation of AMASYS Corporation (incorporated by reference to the Company’s Form 8-A filed on October 15, 1996).
	3.2			Bylaws of AMASYS Corporation (incorporated by reference to the Company’s Form 8-A filed on October 15, 1996).
	10.1			AMASYS Corporation Warrant issued to Chip Brian (incorporated by reference to the Company’s Form 8-K filed on September 6, 2011).
	23			Consent of Independent Registered Public Accounting Firm for the period October 1, 2006 through June 30, 2011.
	31			Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	32			Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 

 

SIGNATURES

 

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

 

	AMASYS CORPORATION
Date: September 7, 2012
	By :  /s/ C.W. GILLULY
	C.W. Gilluly, Ed.D.
	President, Chief Executive Officer and Chief Financial Officer

 

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

 

 

DIRECTORS:

 

Signature                                             Title                               Date

 

 

/s/ C.W. Gilluly                               Chairman                    September 7, 2012

C.W. Gilluly, Ed.D.                           and Director

 

/s/ Robert J. Lynch, Jr.                    Director                        September 7, 2012

Robert J. Lynch, Jr.

 

/s/ Thomas E. McMahan                 Director                        September 7, 2012

Thomas E. McMahan